In order to contribute to sustainable growth and the increase of corporate value over the mid- to long-term, Chugai will hold the shares of other companies only where it is judged necessary to do so, as part of its business strategy to maintain and strengthen business relationships, including with respect to the sale of pharmaceuticals and the like and with respect to financial transactions, etc., and will endeavor to reduce these strategic shareholdings to an appropriate level based on factors such as capital efficiency and risk-return considerations. Since we have established the “Chugai Pharmaceutical Co., Ltd. Basic Corporate Governance Policy” in 2015, we have sold all the 12 strategic shareholdings and currently only hold one brand in accordance with the capital and business tie-up agreement associated with R&D activity.

The Board of Directors will periodically examine the suitability of each individual strategic shareholding by specifically assessing matters such as whether the shareholding purpose is appropriate, the capital efficiency in relation to the shareholding, and the rationale of the relevant transactions; and the Board will disclose the details of that examination. In accordance with the policy, the Board of Directors will examine whether the shareholding purpose is appropriate, the rationale of the relevant transactions and the suitability of each individual strategic shareholding, etc. at the January Board of Directors meeting every year.

Chugai will exercise its voting rights with respect to shareholdings after comprehensively judging whether doing so will contribute to sustainable growth and the increase of corporate value over the mid- to long-term and contribute to the common interests of the shareholders of the other company, taking into consideration the voting guidelines of external proxy advisory firms, asset managers, and the like.