Approach to Cross-Shareholdings

The company acquires and holds shares in companies it deems necessary in order to build, maintain, and strengthen business and cooperative relationships. Each year, the Board of Directors reviews the appropriateness of each individual stock held based on a quantitative assessment of whether the earnings from transactions and dividends exceed cost of capital, as well as a qualitative assessment of the medium-to-long-term business relationship with the company in question. If the rationale behind the company’s holdings no longer applies, they are sold to reduce our holdings.
In exercising voting rights for cross-shareholdings, the company examines the details of the proposals carefully from the perspective of whether they will contribute to medium-to-long-term improvement in the corporate value of the company in question and whether they are likely to damage our corporate value, and then a decision for or against is made.