Role and Composition of the Board of Directors

（Evaluation of the Effectiveness of the Board of Directors）

Roles and Responsibilities of the Board of Directors, etc

The Company has adopted the organization form of a Company with Nomination Committee, etc., to clearly separate management supervision and business execution. In doing so, the Board of Directors acts as a monitoring board, and the Company realizes its mission of "continuous enhancement of corporate value," entrusted by shareholders by implementing efficient and effective corporate governance.

The Board of Directors recognizes three tasks as its principal roles and responsibilities: 1) indicating the general direction of the Company such as corporate strategies, etc.; 2) developing an environment that can support adequate risk-taking in business execution; and 3) carrying out highly effective supervision of business execution from an independent and objective standpoint. The Board of Directors shall consider the viewpoints of all stakeholders.

In addition, the Board of Directors establishes the Basic Management Policy for the long-term business environment so that the Group can enhance its corporate value. To achieve this goal, the Board of Directors strives to improve its social and environmental values through sophisticated ESG-focused management and continuous contribution to solving social issues, including SDGs, through its business. For the same reason, the Board of Directors also makes best efforts to improve its economic value by the ROIC-based management and portfolio-based management at the same time.

For more information about Roles and Responsibilities of Board of Directors, etc., please refer to EBARA's Corporate Governance Basic Policy.

Composition of Board of Directors

To ensure the Board of Directors effectively fulfills its roles and responsibilities, the Company shall make up the Board with directors of sufficient knowledge and experience inside and outside the Company in areas related to business management. To this end, the Company first clearly defines in its basic policy the roles and qualifications required of directors by attribute and position, and then defines the following areas as considered important to the Company from the perspective of corporate management, and requires individual directors to have sufficient knowledge and experience in these areas: “legal affairs and risk management,” “personnel and human resource development,” “finance, accounting, and capital policy,” “auditing,” “corporate management and management strategy,” “technology R&D and innovation,” “the environment,” “social,” and “internal control and governance”.

The Nomination Committee selects candidates for the Board of Directors after confirming that they have met the Company’s qualification requirements, and have knowledge and experience in several of the areas mentioned above. The composition of the Board of Directors elected for fiscal 2024, remains highly independent and diverse, with seven of the ten directors being Independent Directors, three of whom are women.

For more information about the roles and responsibilities of Directors, etc., please refer to EBARA's Corporate Governance Basic Policy.

Evaluation of the Effectiveness of the Board of Directors

The Company constantly seeks the best possible corporate governance and strives towards its further enhancement.

The Board of Directors has been conducting annual evaluations of its effectiveness (including that of the Nomination, Compensation, and Audit Committees) and disclosing the results. The purpose of these evaluations is to verify how the Board of Directors contributes to effective corporate governance as well as to identify issues and make improvements.

The improvement status of issues identified in the previous year is verified through the annual evaluation. Based on this verification, the next issues are identified, and the PDCA cycle is implemented to ensure continuous governance reform.