Overview of the Corporate Governance Structure

GS Yuasa has adopted the form of a company with a Board of Corporate Auditors. In addition, the GS Yuasa Group has in place a corporate governance structure that utilizes internal auditing and other systems appropriate to the Group' s structure. Functions are divided between GS Yuasa Corporation, which is a pure holding company, and GS Yuasa International Ltd., our core operating company. To enhance maneuverability, GS Yuasa Corporation International Ltd. serves as the main decision-making organization for the execution of business by the Group. Meanwhile, GS Yuasa Corporation formulates management strategy for the overall Group. By focusing on oversight and supervision, GS Yuasa Corporation seeks to enhance and strengthen the management structure, as well as augmenting management transparency and efficiency. An overview is provided below.

The Board of Directors of GS Yuasa Corporation is composed of seven directors, including two outside directors who are independent from management. In principle, the board meets once each month. The board also meets additionally, as needed, or resolves matters in writing and reports on them. The Company employs multiple outside directors to enable outside directors to enhance their monitoring of the Board of Directors. The Board of Directors secretariat and the secretarial office are the center of support for outside directors. In addition, important matters are explained in advance by individual departments, as necessary. To further clarify the management responsibility of the directors and increase the trust of shareholders at general meetings of shareholders, the term of office for directors has been shortened from two years to one.

Decision-making related to medium- to long-term strategies of the GS Yuasa Group is centralized at the Board of Directors of GS Yuasa Corporation. Based on these decisions, individual companies and departments, centered on GS Yuasa International Ltd., set and enact priority implementation issues, thereby accelerating and increasing the efficiency of decision-making for the GS Yuasa Group. Furthermore, the Group Risk Management Committee meets twice each year to supervise various risks related to the GS Yuasa Group' s management, promote initiatives and share necessary information.

The Board of Corporate Auditors is composed of four auditors, three of whom are outside auditors who are independent from management. In principle, this board meets once each month. Auditors also attend meetings of the Board of Directors and Group Risk Management Committee, as well as other important meetings, where they voice their opinions and suggestions. Auditors share audit policy and duties, thereby learning about the state of business execution from directors and employees. They also browse important approval documents and resolution-related documentation and audit the status of assets. Auditors appropriately audit the Group by receiving reports on the status of business and risk management from directors and employees at important meetings, exercising their management monitoring function. The auditors interact closely with the accounting auditors and the internal audit department in an effort to augment their respective control functions.

As a result of these initiatives, GS Yuasa Corporation believes that its corporate governance is functioning satisfactorily, and therefore intends to maintain the current structure.

Overview of the Corporate Governance Structure

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