Initiatives to Comply with the Code

Recognizing that people are assets, we consider human resources to be"human capital". We believe that expanding and utilizing thepossibilities of employees, including dispatched temporary staff technicians and engineers, will further enhance the competitiveness of the company and improve its corporate value. In addition to training programs and career advancement support, we are enhancing the system for employee benefits. In the medium-term business plan, at the same time that we are aiming for sustainable growth by providing unique value through the "Technician Support Platform", we are contributing to the realization of a sustainable society.

-Governance

　At our Company, sustainability issues, including dealing with climate change, will be deliberated and examined by the Risk Management Committee in the future. The Risk Management Committee is chaired by the president and representative director and is composed of full-time directors and full-time corporate auditors of the Company and its subsidiaries, as well as the general manager of the Company's legal affairs department. In principle, it meets once a year.

　In addition, when the Risk Management Committee deliberates on important matters related to sustainability issues, including dealing with climate change, the chairman of
the committee reports to the board of directors on such matters. Necessary reports, deliberations, instruction, and supervision are conducted by the board of directors, which ensures the appropriate implementation of important matters related to sustainability issues, including dealing with climate change.

-Risk Management

　The Group recognizes that the direct impact of climate change will be insignificant because it does not need to own land or production facilities for business operations. However, the government's introduction of a carbon tax, renewable energy policies, and advances and innovations in next-generation environmental technology may impact
the technology of customers. As a result, customer needs towards the Group will change, and if the Group is unable to respond to such changes in customer needs, the Group's business performance may be significantly affected.

　In addition, we will use the recommendations of the “Task Force on Climate- Financial Disclosures (TCFD)” as a benchmark to verify the appropriateness of the Group's response to climate change, and we will take advantage of growth opportunities and respond to risks in order to achieve sustainable growth.

At our company, the identification, evaluation, and management of sustainability issues, including our response to climate change, will be handled by the Risk Management Committee in the future. Our specific sustainability initiatives are disclosed in the "Sustainability" section of our website. (https://www.copro-h.co.jp/sustainability/)

- Our Group's View on Human Capital Management

　Since its founding, the Group has been striving to foster an organizational culture that places the utmost importance on human capabilities, and we have promoted management that focuses on people, from our management philosophy to our business strategy. In addition, in the Medium-Term Management Plan, “COPRO Group Build the Future 2027” announced in May 2022, our purpose is defined as - The Best “Work Style.” The Best “Workers.” We strive to continuously improve corporate value by respecting people and maximizing their potential. In the future, the Group will expand the disclosure items related to human capital and, at the same time, regard this as an opportunity to reaffirm the importance of human capital, and we aim to further improve our corporate value. In addition, we will continue to work on management that revitalizes people and our organization, such as monitoring human resource strategies and creating an environment where diverse individuality can be demonstrated.

-Overview of Initiatives for Human Capital Management

　In order to promote human capital management, we believe that both a policy of human resource development and a policy of creating an environment in which each individual can continue to be autonomous and take on challenges is indispensable as an unwavering focal point.

　In addition, as a policy for the future of the Group, we will once again focus on reforming our organization and human resources in order to further improve human capabilities and strengthen our organizational capabilities. We will also aim to achieve corporate growth through constructive dialogue with stakeholders by clarifying specific guidelines and measures for implementation.

(a) Regarding Our Human Resource Development Policy, Including the Ensuring of Diversity “Development of human resources who can think and act on their own, and

who can create diverse value.”

　The average age of our management staff is 30.3 years old, which is younger than the industry standard. Against this background, training (excluding for new graduate
employees), has mainly focused on management skills and problem-solving skills, which are the foundation of business execution. From May 2022, we have been cultivating a culture in which women can play an active role, such as incorporating new career advancement training for women.

　However, at present, two points have become obvious: the fact that there are few types of training, and it is not possible to promote diverse growth, and the fact that the training participants are only candidates for management positions, and we recognize that these are important issues in employee development. Therefore, in the future, we plan to expand the content of our training and scale-up the target audience accordingly. In addition, we have established a development policy that thoroughly implements skill development and its monitoring, and not only for the purpose of training. (Main Guidelines for the Human Resource Development Policy)

Item 1: Expanding the content of our training.

　Details: Expanding the types of training provided to employees.

　Current status: 75 types*1.

　Target: 100 types(FYE2026).

Item 2: Increasing the number of training participants.

　Details: Increasing the number of employees participating in training.

　Current status:Percentage attending is 42.2% *2.
　Target: Percentage attending 60% (FYE2026).

Item 3: Improving the level of understanding and satisfaction of training participants.

　Details: After training, do a survey about the level of understanding and satisfaction (planned).

　Current status: -

　Target: Level of understanding 80%, level of satisfaction 80% (FYE2026).

*1 - Including when joining the company and when returning to work.

*2 - Percentage of employees who participated in training among those who were employed in FYE2023.

(b) Regarding the Policy to Improve Our In-House Environment

“Developing an environment where each employee can have a sense of purpose, and where they can work energetically.”

　The Group believes that it is important for each and every employee to be physically and mentally healthy and to work with a feeling of motivation. For this reason, in addition to promoting the health of our employees, including health management, we are working to create an in-house environment where it is easy to work based on a human resource strategy that focuses on the “work environment” and “motivation.”

　In the future, while promoting further improvements in the working environment by doing such things as promoting DX and reducing overtime work hours, we will also focus on improving employee engagement and reforming internal systems as we strive to create an organization that pursues being a place where it is easy to work and motivating.

(Main Guidelines for Improving Our In-House Environment)

Item 1: Promoting work-life balance.

　Details: Reducing overtime work hours.

　Current status: Monthly average overtime work hours 20.5h *3.

　Target: Monthly average overtime work hours 17.5h (FYE2026).

Item 2: Improving engagement.

　Details: Establishing and improving engagement benchmarks (planned) *4.

　Current status: -

　Target: Positive response rate of 60% (FYE2026).

*3 - FYE2023 results

*4 - Planning to measure items related to job satisfaction.

In addition, the Group's efforts to invest in human capital are disclosed in the following Supplementary Principle 2-4  and in the above "Sustainability" section of the Company's website.

The Company does not formulate a successor plan for the chief executive officer (CEO) at present. Regarding the formulation of a successor plan for the president, considering the qualities such as experience, ability, and character that the chief executive officer should have, the nomination and compensation committee will deliberate and consider so that the most suitable successor can be selected according to the business situation and issues to be dealt with.

Of the Company’s directors, one outside director is a certified Labor and Social Security Attorney, and he is equipped with the well-balanced knowledge, experience, and capabilities to effectively fulfill that role and those responsibilities. The other outside director has extensive experience and insight as a manager, and provides advice on decisions concerning management matters, supervision of the execution of duties, and other matters, based on his experience. Currently, we have not appointed any female or foreign directors, but in the future, the nomination and compensation committee will deliberate and consider structuring things in a way that accommodates diversity and optimal capacity, including gender, internationality, work history and age.

The Company does not have any cross-shareholdings at present. If we do invest in cross-shareholdings in listed stocks in the future, we will disclose our policy on cross-shareholdings, including our policy and views on reducing cross-shareholdings.

The Company defines related parties in the transaction management regulations for related parties. When conducting transactions with such parties as officers and major shareholders, procedures are stipulated depending on the importance and nature of the transactions, such as conducting transactions by a resolution of the Board of Directors after deliberation and consideration by a special committee, and with regards to important transactions, disclosing them in accordance with the laws and ordinances.

- The Approach to Ensure Diversity -
The Group promotes diversity in human resources, working styles and employment.
With having the best ""working style"" and the best “workers” as our purpose, we are promoting diversity through the following three measures.
(i) Promoting the advancement of women.
(ii) Promoting and actively supporting the employment of global human resources.
(iii) Appointing managers with consideration for a balance between hiring mid-career professionals and hiring new graduates.

- Independent and Measurable Goals for Ensuring Diversity
(i) Promoting the advancement of women.
In addition to resolving the social problem of human resource shortages in the construction industry, and in order to improve our corporate value, the Group considers the advancement of women as an important issue, and we have been working on establishing a system to support and balance between work and family, and enhancing employee benefits. While the percentage of female employees working in the construction industry is 15% (*), about 30% of our technical employees are female, and they are active at the companies that we dispatch them to. (*From the 2015 “Labor Force Survey” by the Ministry of Internal Affairs and Communications.)
As of April 1st, 2022, the percentage of women in managerial positions in the Group is 7.3% (department heads or above, the same applies hereinafter), but based on laws to promote the advancement of women and to support the raising of the next generation of children, the following two numerical targets have been set in the general business owner action plan. We will work to create a working environment so that both men and women can work with job satisfaction and can easily balance their work and private lives.
[Numerical Target 1] By November 30, 2023, when the period of the action plan ends, the ratio of women in managerial positions shall be 20% or more.
[Numerical Target 2] By November 30, 2023, we will indirectly promote the advancement of women by getting 50% or more of male employees to take child-care leave, and by setting the average period for child-care leave to one month or more.

(ii) Promoting and actively supporting the employment of global human resources.
The Group is promoting the recruitment of foreigners residing in Japan. In addition, in April 2021, we established COPRO VIETNAM CO., Ltd., a local subsidiary in Vietnam, as a solution to the shortage of human resources in the construction industry, and we are preparing to accept in Japan human resources from overseas. As of March 31st, 2022, there are 38 foreign employees, or 1.7% of all employees, but we will wait for the novel coronavirus to subside before further promoting recruitment.
As of April 1st, 2022, the Group does not have any foreign managers, but in line with the promotion of hiring foreigners and the expansion of business via the Vietnamese subsidiary, our goal is to train one or more foreign managers by the end of March 2025.

(iii) Appointing managers with consideration for a balance between hiring mid-career professionals and hiring new graduates.
In the Group, about 80% of managers are mid-career hires. Since a sufficient number have already been secured, we have not set any specific numerical targets for the promotion of mid-career hires to managerial positions.
Since April 2012, we have been hiring new graduates. While considering the balance with mid-career hires in terms of diversity, we will promote the training and appointment of new graduate hires as managers.

- Human Resource Development Policy and Internal Environment Improvement Policy for Ensuring Diversity and the Status of Implementation -
At the human resources headquarters of COPRO-HOLDINGS and its subsidiaries, we have set up dedicated departments for personnel system reform, recruitment, education and career development support, and are working to create an environment in which diverse human resources can play an active role.
In terms of promoting the advancement of women, we have set up a life event support point-of-contact for employees who have taken maternity or child-care leave. Once a month, they send out information to share policies and changes in the internal environment to foster a sense of belonging, and provide counseling to support returning to work.
In addition, for mid-career hires, we hold career interviews at the end of their first year at the company, confirm the retention rate in the workplace, conduct interviews about future career development and work activities, and provide retention support.
In the future, we will gradually expand such efforts to foreign employees. For human resources who have various values, in addition to providing opportunities for employment and advancement, we also support balance with work when various life events occur.

The Company has not introduced a corporate pension system. If one is introduced, we will strive to promote and assign human resources with the expertise to manage and operate the corporate pension of the Company appropriately. We will also endeavor to properly manage conflicts of interests that arise between corporate pension beneficiaries and the Company.

The Company’s Board of Directors complies with the Articles of Incorporation and laws and regulations, and specified Rules on the Board of Directors for discussing matters in Board of Directors meetings. As a body responsible for making decisions that can respond rapidly to a changing business environment, the Board of Directors has established a system for supervising the execution of duties and strives to make decisions impartially.

The Rules on Meeting Types also specify the Medium-term-Management-Plan Monitoring Meeting that full-time directors and full-time auditors attend. In these meetings, matters referred to the Board of Directors are carefully examined,and matters related to the promotion and progress of the medium-term management plan, management strategies, and matters concerning the overall policy on execution of duties and risk management are discussed.

The scope of delegation to management (directors) is specified in the Rules on Division of Duties, the Rules on Responsibilities and Authority, and the Matrix on Administrative Authority in the addendum to the Rules on Responsibilities and Authority. Duties are performed according to the division of duties and administrative authority granted to the division in charge of each area.

The Company adheres to the standards of independence specified in the Companies Act and by Tokyo Stock Exchange, Inc. in appointing outside directors.

We are a company with a board of corporate auditors, and although the number of independent outside directors has not reached the majority of the board of directors, we have appointed two independent outside directors. In addition, the Company has established a nomination and compensation committee consisting of two independent outside directors and two independent outside corporate auditors. The nomination of candidates for directors and the remuneration of directors are decided by a resolution of the Board of Directors after deliberation and consideration by the nomination and compensation committee from an independent and objective standpoint. Specifically, the following matters are deliberated by the nomination and compensation committee in response to a consultation from the Board of Directors, and are reported to the Board of Directors.
▪ Matters concerning the appointment and dismissal of directors and corporate auditors.
▪ Matters concerning the selection and dismissal of representative directors and executive directors.
▪ Basic policy regarding remuneration for directors and matters related to the remuneration system, etc.
▪ Matters concerning the amount of individual remuneration for directors.
▪ Matters concerning successor planning (including training).
▪ Other matters deemed necessary by the Board of Directors regarding the nomination and remuneration of directors, etc.
While the majority of members of the nomination and compensation committee are not independent outside directors, since all the members are independent outside officers, we believe that the independence and objectivity from the management team are ensured.

In order to enhance the substance of discussions by the Board of Directors, the articles of incorporation limit the number of directors to 10 or less. We also appoint independent outside directors and independent outside corporate auditors, and work to maintain management transparency and soundness. Currently, there are six directors, two of whom are outside directors.
Directors from within the company are appointed from executives in each function such as sales, recruitment and education. As a policy of appointing outside directors and outside corporate auditors based on their expected expertise in major management issues and corporate management experience at other companies, we ensure a balance of knowledge, experience and abilities for the Board of Directors, as well as diversity and appropriate scale.
The policies and procedures regarding the appointment of directors are as described in Principle 3-1 (iv) above.
The so-called skill matrix, which details the knowledge, experience, and abilities of each director, is listed on page 12 of the notice of convocation for the 16th Ordinary General Meeting of Shareholders of the Company.
(NoticeofConvocationAnnualGeneralMeeting2022.pdf)

The main concurrent positions held at other companies in addition to the position of director in the Company are disclosed and explained in the reference materials provided for the General Meeting of Shareholders.

The effectiveness of the Board of Directors is evaluated once a year to ensure more effective Board of Directors meetings. All directors and auditors who participate in Board of Directors meetings complete a survey on the status of operation and functioning to evaluate the Board of Directors and reflect the opinions of all meeting participants. The Company discloses the summary results of such surveys.
The Company analyzes and evaluates the effectiveness of the Board of Directors from the FYE March, 2023. The Board of Directors discusses issues to further enhance the effectiveness of the Board of Directors.

The process, contents and results of the effectiveness evaluation of the meeting, and future tasks are as follows.
＜Process of the effectiveness evaluation>
- Conducting a questionnaire survey for all directors and corporate auditors on the meeting
- The Board of Directors evaluates the results of the questionnaire. The summary of the evaluation results is made public in the Corporate Governance Report.

＜Evaluation of the effectiveness of the Board of Directors, FYE March, 2023>
The Company conducted the questionnaire mainly in the following four areas: (1) Composition of the Board of Directors, (2) Operation of the Board of Directors, (3) Agenda of the Board of Directors, and (4) Supporting Structure of the Board of Directors
In principle, the questionnaire includes items for fixed-point observation. It is updated with items to be improved in the next and subsequent questionnaires based on the evaluation results as well as items in regards to social and in-house issues.

＜Evaluation results of FYE March, 2023 and future tasks>
- Evaluation Results
The Company confirmed that the effectiveness of the Board of Directors has been ensured.
- Future Tasks
Creation of a succession plan for CEO and increase in education and training opportunities for board members.

To facilitate smooth and appropriate performance of duties by directors, members of executive management provide explanations of the Company’s business, finances, and organization, as well as information on industry trends and other relevant information. The Company also plans to provide officer training twice or more a year on topics such as corporate governance, internal controls, risk management, compliance, and corporate accounting. The Board of Directors Secretariat also supports directors by providing information on various types of external seminars and other events to facilitate participation in external seminars and in external organizations.

The Company recognizes the importance of holding constructive dialogue with shareholders, and in order to promote this, makes efforts to address the following:

(i)For dialogue with shareholders, we have appointed the CEO and the manager of the Corporate Planning Office in charge of IR as the spokespersons for communication with investors, and we strive to realize constructive dialogue while ensuring accuracy of information and fairness of disclosure.

(ii)The Corporate Planning Office works to promote IR activities while facilitating positive cooperation between the Medium-term-Management-Plan Monitoring Meeting, general affairs, financing, accounting, legal affairs and other divisions to provide information.

(iii)The department works to enhance the IR-related information on the corporate website, such as presentation materials for the financial results, and enhance dialogue by holding financial results briefings for institutional investors and analysts, among other methods.

(iv)The department has a system in place to share the questions and opinions received through IR activities with management, and where necessary, provides a report to the Medium-term-Management-Plan Monitoring Meeting to share information with directors.

(v)In order to disclose information for such dialogue, the Company carefully manages insider information by confirming beforehand the contents and scope of the information to be disclosed.