Overview of Corporate Governance

Basic Views

Artner’s No.1 business challenge is steadily improving shareholder value over the long term. So in addition to expanding our business and ensuring profitability, we want to grow as a “technical partner” together with our client companies in various industries, as a collective of engineers focused on developing more and more advanced levels of technical expertise. At the same time, with a constant awareness of what society needs most, and a desire to create a demand for it, we strive for business efficiency and soundness to help in the sustainable development of the Company. At Artner, we are highly conscious of our social responsibility as a company, so in addition to strictly observing all applicable laws and regulations, we strive to sustain and develop favorable relationships with shareholders, with our local community, with all of our client companies, and with all employees. We are committed to further strengthening our internal control and risk management efforts through the application of business management systems (including internal control systems) to enable flexible adaptation to changes in the business environment. In this way, we will constantly improve our business management. Artner also will promptly disclose relevant information both inside and outside the company and enhance business transparency.

Overview of Artner’s Corporate Governance Framework and Why This Framework is Used

Artner is a company with an audit and supervisory committee, an organizational design defined by the Companies Act. The Company has in place the following bodies in the framework. (Board of Directors) The Board of Directors, chaired by President and CEO SEKIGUCHI Sozo, is composed of eight members including five directors (SEKIGUCHI Sozo, HARIGAE Tomonori, OKUSAKA Kazuya, SATO So, EGAMI Yoji) (Directors who are members of the Audit and Supervisory Committee are excluded) and three outside directors (NOMURA Ryuichiro, TERAMURA Yasuhiko, MORII Shinichiro) who are members of the Audit and Supervisory Committee. The Board meets twice a month. The Board meets twice a month: At a mid-month business report board meeting, the members deliberate on the Company’s monthly business performance; and at a regular month-end board meeting, they deliberate and decide on matters relating to the Company’s management plan, as well as significant matters relating to day-do-day business operations. The Board of Directors met 30 times in the fiscal year ended January 31, 2025. The attendance of each Director was as follows.

Position	Name	Attendance (FY2025)
President and CEO	SEKIGUCHI Sozo	30 out of 30 meetings (100% attendance rate)
Director	HARIGAE Tomonori	30 out of 30 meetings (100% attendance rate)
Director	OKUSAKA Kazuya	30 out of 30 meetings (100% attendance rate)
Director	SATO So	30 out of 30 meetings (100% attendance rate)
Director	EGAMI Yoji	30 out of 30 meetings (100% attendance rate)
Outside Director and standing member of the Audit and Supervisory Committee	NOMURA Ryuichiro	30 out of 30 meetings (100% attendance rate)
Outside Director and member of the Audit and Supervisory Committee	TERAMURA Yasuhiko	30 out of 30 meetings (100% attendance rate)
Outside Director and member of the Audit and Supervisory Committee	MORII Shinichiro	30 out of 30 meetings (100% attendance rate)

(Audit and Supervisory Committee) The Audit and Supervisory Committee, chaired by Standing Audit and Supervisory Committee member NOMURA Ryuichiro, is composed of three Audit and Supervisory Committee members who are outside directors. The committee meets twice a month. Directors who are members of the committee also attend board meetings and other important internal meetings. The committee provides impartial and independent oversight of the Company’s corporate management, based on the audit standards as well as the audit policy and plans established by the committee. The Audit and Supervisory Committee met 26 times in the fiscal year ended January 31, 2025. The attendance of each Director was as follows.

Position	Name	Attendance (FY2025)
Director and standing member of the Audit and Supervisory Committee	NOMURA Ryuichiro	26 out of 26 meetings (100% attendance rate)
Outside Director and member of the Audit and Supervisory Committee	TERAMURA Yasuhiko	26 out of 26 meetings (100% attendance rate)
Outside Director and member of the Audit and Supervisory Committee	MORII Shinichiro	26 out of 26 meetings (100% attendance rate)

(Nomination and Remuneration Committee) The Nomination and Remuneration Committee, chaired by Audit and Supervisory Committee member TERAMURA Yasuhiko, is composed of four members including the President and CEO and three members of the Audit and Supervisory Committee who are outside directors. The Nomination and Remuneration Committee will deliberate and report to the Board of Directors on the following matters in order to enhance the fairness and objectivity of the decision-making process of nominating and determining the remuneration of Directors as well as enhancing corporate governance. ・ Matters relating to the appointment and dismissal of Directors ・ Matters relating to the succession plan ・ Matters relating to the nomination policy and the evaluation criteria for “abilities, qualifications, experience, and values” based on the nomination policy ・ Matters relating to the appropriateness of the remuneration level of Directors ・ Matters relating to the basic policy on the remuneration of Directors and the policy for determining the remuneration for each individual The Nomination and Remuneration Committee met six times in the fiscal year ended January 31, 2025. The attendance of each Director was as follows.

Position	Name	Attendance (FY2025)
President and CEO	SEKIGUCHI Sozo	6 out of 6 meetings (100% attendance rate)
Director and standing member of the Audit and Supervisory Committee	NOMURA Ryuichiro	6 out of 6 meetings (100% attendance rate)
Outside Director and member of the Audit and Supervisory Committee	TERAMURA Yasuhiko	6 out of 6 meetings (100% attendance rate)
Outside Director and member of the Audit and Supervisory Committee	MORII Shinichiro	6 out of 6 meetings (100% attendance rate)

(Compliance and Risk Management Meeting) The Compliance and Risk Management Meeting, chaired by the President and CEO, is composed mainly of Heads of Divisions and Departments in addition to eight directors. The meeting is held monthly. In these meetings, members discuss policies and actions to ensure that all officers and employees of the Company abide by laws and the Company’s Articles of Incorporation, and draw up the Risk Management Guidelines. (Sustainability Committee) The Sustainability Committee, chaired by the President and CEO, is composed mainly of Heads of Divisions and Departments in addition to eight directors. The committee meets four times a year. At each meeting, the members hold discussions to promote and manage the progress of issues and initiatives related to sustainability. Artner currently uses this framework because the mutual supervision of business operations by directors works well, as does the audits and supervision of the Board of Directors by the Audit and Supervisory Committee.

Company Organization and Internal Control System

Activities of the Board of Directors and Committees

FY2025

	Status of Main Activities
Board of Directors	(Discussions and Resolutions) General Meeting of Shareholders / Policy for the Mid-Term Business Plan / Corporate planning and strategy / Department policies and business plan for the FY2026 /Financial results, finances, and dividends / Revisions to the forecast of financial results / Nomination of director candidates and remuneration of directors / Internal controls / Organizational changes and personnel transfers / Rule revisions / Reappointment of the Accounting Auditor(s) / Donations to support organizations / Updating and disclosing ESG data, etc.
Compliance and Risk Management Meeting	(Discussions) Performance trends in the manufacturing industry / Competition with other companies in the industry / Effectiveness of education and training / Securing suitable clients for our dispatching business / Regulations on total work person-hours / Securing science and engineering graduates / Securing career engineers / Information management / Laws, regulations, licenses, and permits / Disasters, accidents, etc. / Climate change / M&A / Medium-Term Business Plan, etc.
Sustainability Committee	(Discussions) Policies and goals related to sustainability, including social and environmental issues such as the SDGs and ESG; formulation of an action plan; management and evaluation of progress toward goals; individual measures, etc.
Audit and Supervisory Committee	(Discussions) Audit policy, audit plan, audit methods, assignment of audit duties, etc. / Appointment and dismissal of Accounting Auditor(s) / Appointment, dismissal, and remuneration of directors who are not members of the Audit and Supervisory Committee, etc.
Nomination and Remuneration Committee	(Discussions) Appointment and dismissal of directors / Selection and discharge of the President and CEO / Selection and discharge of representative directors / Remuneration, etc., of directors who are not members of the Audit and Supervisory Committee / Remuneration limits for directors and directors who are members of the Audit and Supervisory Committee / Succession planning (including successor development), etc.