Accountability to Stakeholders

ITOCHU emphasizes dialogue with its shareholders, investors, and other stakeholders from the perspective of achieving sustainable growth and enhancing corporate value over the medium to long term. We now strive to reflect input obtained in investor meetings, general meetings of shareholders, and one-on-one meetings into our management strategies and financial and capital policies. Through commitment-based management, we are striving to expand corporate value and sustain a positive cycle through effective engagement. Investor relations activities in FYE2023 include the followings.

Activity	Times	Content
Investor briefings on financial results for analysts and institutional investors	4	Held presentations for analysts and institutional investors every quarter, through investor briefings or web conferences.
Briefings on operating segments, projects and site tours and sustainability briefing for analysts and institutional investors	1	We hold meetings for analysts and institutional investors to explain specific themes, such as strategies of individual operating segments. (Topic of FYE 2024 : Collaborative Projects Briefing )
Overseas IR roadshow	5	Visited Europe, North America, Hong Kong and Singapore to have individual meetings with overseas institutional investors.
Conferences sponsored by securities companies	6	Attended conferences sponsored by securities companies and held individual meetings mainly with overseas institutional investors.
Meetings for individual investors	3	Held meetings for individual investors through web conference and at securities companies etc.
Disclosure of IR-related materials on website	－	Disclose Investor Relations-related materials on our website. Following materials are available: financial statements, presentation materials for investors’ meetings (including Q&As), materials used in segment-specific briefings, TSE filings, annual securities reports (yuka shoken hokokusho), quarterly securities reports (shihanki hokokusho), the status of corporate governance, convocation notices for General Meetings of Shareholders, reports (hokokusyo) and annual and notice of general meeting of shareholders.

Dialogue with Stakeholders

We are working to engage actively with all of our stakeholders to sustainably enhance our corporate value, and we have prepared contents that responds to the high expectations and frequently asked questions of our stakeholders in our Integrated Report.

Q1：What are the contents of the Management Policy?

Management Policy: The Brand-new Deal —Profit Opportunities Are Shifting Downstream—

Q2：What are the management's intentions, the shareholder return policy, and the financial logic behind the Management Policy?

CEO Message

COO Message

CFO Message

Q3：What is the past track record that ensures future growth indicated in the Management Policy, and what has made it possible?

Trajectory of Corporate Value Enhancement

Track Record of Profit Growth under “Brand-new Deal” Strategies

Q4：What are the current financial results, the analysis of macroeconomic factors, and the current state of China-related business?

CSO Interview

PEST Analysis (Macroenvironmental Factors)

Countermeasures for Business Risks

Q5：What initiatives are being undertaken to maintain highly efficient management and improve the success rates of investments?

Portfolio Management

Business Investment

Q6：What are the key points in accelerating growth investments, and examples of businesses developments?

CXO Interview

Our Business Model, as Seen through Business Development

Special Feature: Creating Businesses by Leveraging Our Strengths

Q7：What are the unique human resource strategies and sustainability initiatives?

Initiatives to Promote Sustainability

Human Resource Strategy to Enhance Corporate Value

Q8：What improvements are being made to the governance system?

Outside Directors & CAO Roundtable

Corporate Governance

Actions towards achieving management that is conscious of capital costs and stock prices

[Current understanding]
ITOCHU has verified and discussed the cost of capital, and currently understand it to be 8%, as disclosed in our Integrated Report (Annual Report). However, we recognize that the market demands a higher level of return. Therefore, while appropriately allocating management resources, we strive for highly efficient management with a focus on achieving a globally highly regarded level of ROE of 15% or higher, and aim to sustainably enhance corporate value.

Over the 14-year period from FYE2011 to FYE2024, the average ROE was 16%, and the stock price increased by approximately 8 times during the same period, showing a continued upward trend. Additionally, we have recently formulated the Management Policy that serves as a long-term compass for the purpose of sustainable enhancement in corporate value. This policy was announced on April 3, 2024.

[Policy and Target]
In the Management Policy, we have set forth the following three principles to achieve sustainable enhancement in corporate value.

Grow earnings: “No growth without investments” (Accelerating growth investment to expand business areas and further strengthen and expand the business foundation.)

Enhancement of corporate brand value: Reinforcement of human capital, strengthening dialogue with stakeholders, enhancing our contribution to and engagement with the SDGs through business activities.

Shareholder Returns: Total payout ratio of 40% or more, dividends of the higher of 30% dividend payout ratio or dividend ¥200 per share.

Furthermore, our longstanding financial policy (maintaining financial foundation based on balancing three factors: growth investments, shareholder returns, and control of interest-bearing debt) remains unchanged.

As mentioned above, ITOCHU has achieved high-efficiency management over the long term. To continuously achieve high capital profitability in the future, we will maintain and improve of high ROE based on the principles outlined in our Management Policy. This essentially involves growing earnings based on our track record of achieving a compound annual growth rate (CAGR) exceeding 10% (FYE2011-FYE2024: 13%) and ensuring total payout ratio of 40% or more. For FYE 2025 single-year Management Plan, we set the target of ROE as 16%.

Furthermore, in order to ensure understanding from shareholders and investors, etc., we provide detailed explanations during General Meetings of Shareholders, investor briefings, and various other explanatory briefings regarding the underlying concepts and strategies behind the Management Policy. We have also clearly demonstrated the connection between the management policy, strategies and the enhancement of corporate value using the "Corporate Value Calculation Formula," in our Integrated Report (Annual Report).

(Update Date: June 21, 2024)