KAGA ELECTRONICS CO.,LTD.

Principle 2-4: Ensuring Diversity, Including Active Participation of Women

Supplementary Principle 2-4-1:

1. Appointment of Women to Managerial Positions

The Company aims to achieve a ratio of female managers of around 25% during the 2030s. Accordingly, based on a mid- to long-term perspective, the Company will promote the creation of an environment where women can actively participate as a matter of course and support the autonomous growth of our employees. At the same time, we will also continuously work to ensure that our female employees accumulate experience, develop a career mindset, etc., and thereby steadily increase the proportion of women among core human resources.

Principle 2-6: Function as asset owner of corporate pensions

In order to provide retirement benefits to its employees, the company uses both a defined benefit corporate pension plan and a defined contribution pension plan.

The management of the defined benefit corporate pension reserve is relegated to an asset management entity that has declared its acceptance of the Stewardship Code, and the company appropriately supervises said management, e.g. via regular reports to its relevant internal department.

Principle 3-1: Enhancement of Information Disclosures

1. The Company’s vision (corporate principles and so on), management strategies, and management plans are posted on the Company’s website as the Kaga Electronics Corporate Philosophy and Action Guidelines at https://www.taxan.co.jp/en/company/vision/, and information on our medium-term management strategy can be found at https://www.taxan.co.jp/en/ir/management/management_07.html.

2. With regard to the Company’s fundamental approach and policies on corporate governance, refer to this report, Section I: Basic approach to corporate governance, capital structure, corporate attributes, and other basic information, Part 1: Basic approach.

3. With regard to policies and procedures for the determination of the remuneration of management executives and directors by the Board of Directors, refer to this report, Director Remuneration under Section II: Management decision-making, management organizations

for execution and supervision, and other elements of the corporate governance system.

4. At Kaga Electronics, our policy when nominating director candidates is to “nominate persons with character and insight, who will contribute to the sustainable growth of the Group and corporate value over the mid to long term as director candidates.” When selecting corporate Audit and Supervisory Committee members, our policy is to select “persons of appropriate character for corporate Audit and Supervisory Committee members, with advanced specialist knowledge and abundant experience.” When nominating director candidates, first, the Nomination and Compensation Committee, an advisory body to the Board of Directors, deliberates the nominations and makes a report to the Board of Directors, then upon receiving this report, the Board of Directors deliberates and decides on the nominations. When nominating corporate candidates for director who are Audit and Supervisory Committee members, after the Nomination and Compensation Committee has deliberated the matter and the consent of Audit and Supervisory Committee members has been obtained, a report is made to the Board of Directors. Upon

receiving this report, the Board of Directors deliberates and decides on the nominations. The Nomination and Compensation Committee consists of 3 outside directors and 2 internal directors. In addition, the Board of Directors decides on the selection and dismissal of upper-level management based on the employment-based and delegation-based executive officer regulations and criteria of each type of qualification, and after evaluation by the Group Management Headquarters Meeting and the Nomination and Compensation Committee.

5. The company will provide explanations regarding the naming and selection and dismissal of board directors at appropriate times via means such as news releases and convocation notices for general shareholder meetings.

Supplementary Principle 3-1-3:

The Kaga Electronics Group recognizes the promotion of CSR and sustainability as important management issues. We have established a Sustainability Committee chaired by the Representative Director and President of Kaga Electronics Co., Ltd. Under the committee, we have set up specialized subcommittees for Environmental Management Promotion, Diversity Promotion, Governance, Risk Management, Compliance, and Information Disclosure. This management structure promotes CSR and sustainability across the Group. Under the commitment of top management and in collaboration with business divisions, we work as a united group to promote sustainability through each committee by formulating policies, measures, and targets for ESG issues and managing progress.

In fiscal 2024, the SDGs Committee (now the Sustainability Committee) met two times, with each subcommittee directly under the Sustainability Committee meeting once each month, in principle, actively engaging in a series of discussions and considerations on each theme.

Regarding the Medium- to Long-term Sustainability Management Plan formulated on November 25, 2021, each committee directly under the Sustainability Committee reports the progress on each KPI to the Sustainability Committee on a semi-annual basis. The Sustainability Committee verifies the appropriateness of the measures and checks the need for additional measures, thereby implementing the PDCA cycle to work toward realizing the ESG issues set forth in the plan.

Led by the Environmental Management Promotion Committee, and giving reference to the TCFD recommendations framework, the matters the Company consider to be the major physical risks as well as the transition risks and opportunities relating to climate change, and our response policies, can be found on the sustainability information page of our website. Sustainability page: https://www.taxan.co.jp/jp/csr/conservation/index.html

Led by the Diversity Promotion Committee, the Company is working to ensure diversity in the areas of “promoting women’s empowerment” and “appointing women, foreign nationals, and mid-career hires to managerial positions.” Additionally, under the theme of “balancing work–life management and enhancement of productivity,” the Company has reviewed work styles and developed an environment and systems focused on childcare and nursing care, revising its rules and regulations to make telework a permanent system. Moreover, in 2025, the Company has been recognized as a Certified Health & Productivity Management Outstanding Organization for the third consecutive year.

Supplementary Principle 4-1-1:

The Board of Directors has established the Board of Directors Rules as a decision-making body for important matters that include the formulation of basic management policies and management plans, and decisions on matters delegated by the General Meeting of Shareholders, in an effort to clearly define the matters to be resolved. In order to ensure timely management, the Board also has adopted an executive officer system and formulated the Rules on Work Authority to properly delegate authority. The Board assumes its roles of appointing the executive officers to be delegated and overseeing the execution of their duties.

Principle 4-9: Independence Standards and Qualifications for Independent Outside Directors

In accordance with the Tokyo Stock Exchange standards on independence, the Company requires that there be no special interests in the Company with regard to the election of outside directors and discloses the qualification criteria for outside directors through convocation notices. In addition, to reinforce the functions of the Board of Directors, outside directors are required to have extensive experience and broad powers of judgment as corporate managers and the like.

Principle 4-10-1:

The Company has adopted a Company with an Audit and Supervisory Committee, and while outside directors do not constitute a majority of the Board of Directors, we have established a voluntary Nomination and Compensation Committee. The Nomination and Compensation Committee has a majority of independent outside directors, and the chairperson is appointed from among the independent outside directors. The committee provides appropriate advice on and involves itself in such matters as the independence, objectivity, and accountability of the functions of the Board of Directors concerning the nomination and compensation of directors and delegation-based executive officers, as well as succession planning. By respecting the findings of the Nomination and Compensation Committee, the independence, objectivity, and accountability of the functions of the Board of Directors are also strengthened appropriately.

Principle 4-11-1:

The Company emphasizes ensuring diversity on the Board of Directors as a whole with different specialized knowledge, experience, and so on with regard to nominating candidate directors so that the Board can demonstrate maximum effectiveness and efficiency.

The Company discloses a skill matrix for each director along with the career summaries of independent outside directors and other information on our website and in the Notice of the 57rd Ordinary General Meeting of Shareholders.

Supplementary Principle 4-11-2:

The Company discloses the materials regarding the concurrent positions of directors in its notice of convocation of the regular ordinary General Shareholders Meeting and securities reports.

Directorsʼ concurrent positions as new officers at other Group Companies are appropriately reported to the Board of Directors, and the time and work necessary to appropriately fulfill their roles and responsibilities as directors of the Company are secured. The Company discloses the status of attendance at Board of Directors meetings in its notice of convocation of the regular ordinary General Shareholders Meeting, integrated reports, and securities reports.

Supplementary Principle 4-11-3:

Every year, the Company analyzes and evaluates the effectiveness of the Board of Directors as a whole.

In terms of the method of analysis and evaluation, the Company administers self-assessment questionnaires to all directors with questions related to the effectiveness of the Board of Directors (such as the composition, operation, and functions of the Board of Directors, the provision of information to outside directors, and governance systems). The results of the questionnaires are then analyzed and evaluated.

Based on the questionnaire conducted in April 2025, the Company has judged that a certain level of effectiveness of the Board of Directors as a whole has been ensured.

Principle 4-14-2:

The Company provides necessary opportunities and supports the cost of acquiring knowledge relating to the management, compliance, and so on necessary for directors to fulfill their roles and perform their responsibilities.

Principle 5-1: Policy on Constructive Dialogue with Shareholders

● Fundamental Approach

The Company undertakes active measures to engage in dialogue and other interactions with shareholders and investors in order to achieve sustainable growth and increase corporate value in the medium to long term.

(1) Investor relations structures

The Representative Director, President & COO oversees dialogues with shareholders and investors, along with the CFO and the specialized Investor Relations and Public Relations Department.

(2) Methods of dialogue

The Company holds financial briefings for mass media, analysts, and institutional investors twice annually (in May and November), as well as briefings on its business and strategy, and responds appropriately to requests for individual visits and for information. For our shareholders and individual investors, information on management policies, business details, results, videos of financial briefings for institutional investors, and other information are posted on the Company’s website and the Company strives to enhance information disclosures. In addition, the Company regularly participates in large-scale briefings for individual investors held in Tokyo, Osaka, and other major metropolitan areas and responds appropriately to individual inquiries.

(3) Internal feedback

Feedback regarding the details of dialogues with shareholders and investors is provided by the officers responsible for management divisions and Investor Relations and Public Relations Department to the Board of Directors and other relevant divisions as necessary.

(4) Insider trading and quiet periods

The Company does not divulge insider information during dialogues with shareholders and investors. The Company has established Rules on Internal Information Management and Restriction of Insider Trading and strives to manage insider information. The periods from the end of each quarterly financial period until the announcement of financial results for that period are designated quiet periods and dialogue and information disclosures are restricted during those periods.