TV Asahi Holdings Corporation Corporate Governance Guidelines

Article 1 (Basic Approach to Corporate Governance)

• 1. As a certified broadcasting holding company that has private affiliated broadcasting stations, TV Asahi Holdings Corporation (hereinafter “the Company”) is consistently aware of the public nature and public interest of broadcasting, including the requirements provided by the Broadcasting Act, the Radio Act, and the Civil Protection Law. It pursues profit through proper and just practices by managing operations by means of a holding company where business subsidiaries exert to progress culture by providing vital information for the life of citizens and sound entertainment, uphold an impartial and nonpartisan position, and endeavor to contribute to the development of democracy.
• 2. In order to carry out corporate activities while fulfilling its public duty as a broadcaster, the Company firmly believes that the source of its corporate value lays in the continual production and distribution of content that delivers to the needs of society, which is based on securing and developing a workforce that shares the same philosophy, maintaining trust with stakeholders, and fulfilling its duty as a broadcaster and member of the press.
• 3. The Company believes that the foundation of its corporate governance lies in the creation and execution of a mechanism that enables the Company to strive for sustainable growth and increase its medium- to long-term corporate value while maintaining appropriate relationships with various stakeholders.

Article 2 (General Meeting of Shareholders)

The Company believes that the exercise of rights, including the exercise of voting rights, of a large number of shareholders, shall be substantially ensured by warranting equality. Based on this belief, the Company determines the schedule and discloses information for the General Meeting of Shareholders in accordance with the Companies Act, the Broadcast Act, and other laws and regulations.

Article 3 (Composition of the Board of Directors)

The Company is a certified broadcasting holding company that incorporates private commercial broadcasters. Given the highly public nature and interest of broadcasting business, in addition to full-time directors in charge of business execution, the Company shall appoint diverse persons, including strategic capital and business partners, persons who have a certain extent of relationship with and wide experience and knowledge in the broadcasting business, and persons who are able to objectively monitor the just and appropriate relationships with stakeholders and are independent of senior management of the Company.

Article 4 (Criteria of Independence of Outside Officers)

The Company’s criteria of independence of independent officers as stipulated by the Tokyo Stock Exchange among outside directors of the Company are as follows. (Independent officers of the Company shall be appointed from persons who do not fall under any of the following items.)

• (1) A person who falls under the following at the time of appointment or in the past three years:
• ① Operating director, corporate executive officer or important employee of a company whose officers include an operating director or important employee of the Company or its subsidiaries (hereinafter “the Group”)
• ② Operating director, corporate executive officer or important employee of a major shareholder who holds 10% or more of the voting rights of the Company
• ③ Operating director, corporate executive officer or important employee of a company whose major business partners include the Group (Note 1) or a company that is a major business partner of the Group (Note 2)
• ④ Consultant, accounting professional or legal professional who has received money or other properties equivalent to 10 million yen or more per year in addition to officer’s compensation from the Group (in cases where the entity that receives such properties is a corporation, association or other organization, the person who belongs to such organization applies)
• ⑤ Board member or important executive of an organization that has received annual average donation or aid of 10 million yen or more from the Group for the past three fiscal years
• ⑥ Operating director, corporate executive officer or important employee of an affiliated broadcasting company
• (2) A person whose spouse or relative within the second degree of kinship currently falls under the following:
• ① Operating director or important employee of the Group
• ② A person who falls under ① through ⑥ in (1) above
• (3) A person under circumstances where it is reasonably deemed that the person is unable to perform their duties as an independent officer, other than (1) and (2) above
• Note 1: A company whose major business partners include the Group is defined as a company that has received payment from the Group equivalent to 2% or more of the company’s annual consolidated sales in the most recent fiscal year.
• Note 2: A company that is a major business partner of the Group is defined as a company that has made payment to the Group equivalent to 2% or more of the Group’s annual consolidated sales in the most recent fiscal year, and a company that has provided loans to the Group equivalent to 2% or more of the Group’s consolidated total assets in the most recent fiscal year.

Article 5 (Matters to Be Submitted to the Board of Directors)

• (1) Purpose
  To deliberate and decide on matters prescribed by laws and regulations, the Articles of Incorporation and the Board of Directors regulations as the decision-making body of the Company’s management.
• (2) Duties
  The duties include deliberating and adopting the decision on the basic policy, the monitoring of appropriateness and legality, and the confirmation of the framework regarding the Company’s management policy, management strategy, capital policy, corporate structure, important rules and particularly important business operations from a multifaceted point of view with a common understanding in order to achieve sustainable growth and increase corporate value of the Company over the medium to long term.
• (3) Matters to be resolved and reported
  The following matters shall be submitted to the Board of Directors, with quantitative and qualitative standards that are considered to be appropriate based on the type and size of the Company’s business.
• ・Matters concerning the General Meeting of Shareholders
  ・Important matters concerning management in general
  ・Matters concerning capital policy, etc.
  ・Matters concerning the Board of Directors
  ・Matters concerning the organization and personnel affairs
  ・Matters concerning important business operations
  ・Matters concerning important rules
  ・Matters concerning important lawsuits and contracts
  ・Other matters
• In addition, the departments in charge of assisting the officer in charge of corporate communications and the Audit and Supervisory Committee are responsible of attesting the importance, conflict of interest, competitive nature, etc.
• (4) Delegation to the Board of Directors
  In accordance with Article 24 of the Articles of Incorporation, the Company has established a system to delegate part of the decision on important business operations (e.g., acquisition and disposal of important assets) to directors for quicker decision-making.

Article 6 (Audit and Supervisory Committee)

• 1. The majority of the members of the Audit and Supervisory Committee shall consist of independent outside directors who satisfy the criteria of independence of outside officers provided in Article 4.
• 2. Pursuant to laws and regulations and the Articles of Incorporation, the Audit and Supervisory Committee shall audit the execution of duties by directors, prepare audit reports, determine the content of the propositions regarding appointment and dismissal of the accounting auditor, and resolve on the opinion of the Audit and Supervisory Committee on matters related to the nomination and remuneration of directors.

Article 7 (Appointment and Dismissal of Management and Nomination of Candidates for Directors)

• 1. Nomination policy
• (1) Common matters
  Article 3 (Composition of the Board of Directors) shall apply to the appointment of management and the nomination of candidates for directors.
  In light of the business environment, management targets and management issues, the Board of Directors shall endeavor to have an unbiased and shared understanding of the qualities, abilities, and character required of management and candidates for directors, through the Board of Directors meetings or opportunities for information exchange mainly with outside officers.
• (2) Management
  In appointing management, the officer in charge of personnel affairs shall select the final candidates together with Representative Directors by narrowing down candidates, taking their work experience, competence and performance into consideration.
• (3) Directors
  In light of the diverse composition of the Board of Directors, the Company’s basic policy on corporate governance and the “Basic Policy on Succession Planning for the Board of Directors,” the candidates for directors shall be submitted to the Board of Directors, comprehensively taking into consideration the candidates’ attributes, career history, performance, knowledge, etc. based on (1) Common matters above.
  For full-time directors (excluding those who also serve as Audit and Supervisory Committee members), the candidates to be deliberated on by the Board of Directors shall be narrowed down by checking their aptness, from the perspective of whether they have knowledge and experience for contributing to the development, execution and advancement of the business, whether they genuinely understand the corporate philosophy and strategy of the Company and will contribute to increasing corporate value also in a medium- to long-term, and whether they have qualities as a leader to gain cooperation from others from the point of ethics and integrity, in proposing, discussing and deciding on business execution.
• 2. Procedures for appointment, dismissal and nomination
• (1) Appointment and dismissal of management and nomination of candidates for directors (excluding those who also serve as Audit and Supervisory Committee members)
  The procedure for appointment and dismissal of management and nomination of candidates for directors (excluding those who also serve as Audit and Supervisory Committee members) shall be finalized by a resolution of the Board of Directors after receiving a report from the Nomination and Compensation Committee as stipulated in Article 9.
• (2) Directors who also serve as Audit and Supervisory Committee members
  In the case of nomination of directors who also serve as Audit and Supervisory Committee members, Representative Directors (the CEO in the case where a CEO has been appointed) shall obtain the consent of the Audit and Supervisory Committee for the proposals for candidates prepared in accordance with the nomination policy in the preceding paragraph. After obtaining such consent, the proposals for candidates shall be finalized by a resolution of the Board of Directors.

Article 8 (Compensation for Management and Directors)

• 1. Policy for deciding on compensation
• (1) Operating Directors
  Compensation shall be classified into three categories, “basic compensation,” “performance-based compensation,” which is based on the performance of the Company, and “incentive compensation,” which is based on the performance of the individual. Details are provided by the internal rules on compensation determined by the Board of Directors. In addition, in order to have a medium to long term perspective and having a management incentive with the stock price in mind, the Board of Directors has agreed that a certain percentage depending on the director’s position shall be allocated to the acquisition of treasury shares through the shareholding association. In principle, those shares shall not be sold during the term of office.
• (2) Outside directors and non-full-time directors (excluding those who also serve as Audit and Supervisory Committee members)
  Only the basic compensation shall be paid pursuant to the internal rules on compensation.
• (3) Directors who also serve as Audit and Supervisory Committee members
  The Audit and Supervisory Committee members shall discuss the allocation, taking into consideration the internal rules that serve as the basis for the allocation after the discussion of the Audit and Supervisory Committee members. Non-full-time Audit and Supervisory Committee members shall receive the basic compensation only pursuant to the internal rules on compensation.
• 2. Procedures for determining compensation
• (1) Directors (excluding directors who also serve as Audit and Supervisory Committee members)
  An amount within the maximum amount of compensation approved by the General Meeting of Shareholders shall be submitted to the Board of Directors after receiving a report from the Nomination and Compensation Committee as provided by Article 9.
• (2) Directors who also serve as Audit and Supervisory Committee members
  An amount within the maximum amount of compensation approved by the General Meeting of Shareholders shall be determined through discussion among directors who also serve as Audit and Supervisory Committee members in accordance with the internal rules of compensation.

Article 9 (Nomination and Compensation Committee)

• 1. The Company shall endeavor to strengthen and enhance its corporate governance by establishing the Nomination and Compensation Committee from the perspective of seeking appropriate advice and involvement of independent outside directors regarding policies and decision-making procedures for the appointment and dismissal of management and the nomination and compensation of directors (excluding directors who also serve as Audit and Supervisory Committee members).
• 2. The majority of the members of Nominating and Compensation Committee shall consist of independent outside directors.
• 3. The Board of Directors shall make a final decision on the appointment and dismissal of management and the nomination and compensation of directors (excluding directors who also serve as Audit and Supervisory Committee members) in light of a report from the Nomination and Compensation Committee.

Article 10 (Training of Directors)

• 1. Purpose
  To enhance the effectiveness of the Board of Directors through appropriate circulation of information and dialogue with the members of the Board of Directors in accordance with the Company’s basic approach on the composition and function of the Board of Directors.
• 2. Method
  Information shall be provided and opinions shall be exchanged among the parties concerned regarding necessary knowledge, management issues, management information, the management environment, etc. surrounding the Company, taking into consideration whether the person is a full-time or non-full-time director, their career experience, attributes, period in office, etc.
• 3. Implementation
  Lectures on the Company’s history, business affairs, governance system, management plan, management policy, etc. shall be provided to newly appointed non-full-time directors before/after the time of their assumption of office. In addition, knowledge on law amendments and other necessary matters shall be provided by utilizing opportunities of the Board of Directors meetings, etc.

Article 11 (Ensuring Rights and Equality of Shareholders)

As a publicly listed company, the Company shall appropriately provide necessary information through the Company’s website and various other tools to ensure equality of shareholders and the proper exercise of rights. In addition, as a certified broadcasting holding company that has private affiliated broadcasting companies, the Company shall heed to prevent concerns regarding the exercise of statutory rights for profit-sharing and rights to self-interest of shareholders that are stipulated by the law, including the Broadcasting Act, in order to maintain the public nature, public interest, and impartial and nonpartisan position of broadcasting.

Article 12 (Shareholding)

• 1. In principle, the Company shall not continue to hold any shares over the long term without any reasonable reasons that do not contribute to increasing corporate value of the Company regardless of reasons of business practice or long-standing relationships.
• 2. The Company has a policy to acquire and hold shares of companies with which it has important business relationships or cooperative relationships from the perspective of contributing to increasing the Company’s corporate value. In order to make the investments and also understand and manage the post-investments, the Company shall establish the Investment Review Committee that directly reports to the full-time directors’ meeting.
• 3. In accordance with the regulations on investment, the Investment Review Committee shall examine the necessity of investment and shareholding based on the purpose, scale, type, necessity, risk, profitability, and other factors of investment. For major cross-shareholdings, the Investment Review Committee shall request the Board of Directors to decide, once a year in principle, on the necessity of investment and continuation thereof, based on the regulations and the results of the examination by the Investment Review Committee.
• 4. For exercising the voting rights of shares in which the Company has invested, a uniform criteria for approval and rejection shall not be established. In the event matters that may negatively affect the Company’s corporate value or its shareholders’ interest are proposed, the approval or rejection shall be determined separately by close examination of their impact.

Article 13 (Related Party Transactions)

• 1. For transactions with officers, a review of each officer shall be undertaken where the existence of such transactions shall be reported.
• 2. For significant transactions that are submitted to the Board of Directors, the Board of Directors shall monitor conflicts of interest, competitive relationships, and the impact of such transactions from diverse perspectives.
• 3. For the maintenance of appropriate business relationships with group companies and affiliated broadcasting companies, the Company shall make efforts to ensure appropriate transaction by establishing sections in charge of the respective matter and management.
• 4. As for transactions with officers or major shareholders, since they fall under Article 356 of the Companies Act, any planned transactions of such type shall be submitted to the full-time directors’ meeting and the Board of Directors in advance depending on the category, scale, and type of the transaction. After a certain period of time, the actual status of the transaction shall be reported to the full-time directors’ meeting and the Board of Directors. In this process, the appropriateness, suitability and justness of the transactions and other necessary matters shall be monitored, and the protection of minority shareholders shall also be checked.

Article 14 (Constructive Dialogue with Shareholders)

• 1. In order to establish and practice systems and initiatives necessary to facilitate constructive dialogue with shareholders, etc., the officers in charge of corporate strategy and administration shall discuss and adopt procedures and actions necessary for reasonable execution of the practices and initiatives.
• 2. Relevant sections such as the finance, administration (governance) and corporate strategy sections shall meet regularly to examine the policy, content and timing of providing information to shareholders, etc.
• 3. As for reporting to investors and IR activities, the officer in charge of IR shall report the plans and results to the full-time directors’ meeting.
• 4. The section in charge of dialogue with shareholders, etc. shall regularly provide feedback of general trends regarding opinions and ideas of shareholders, etc. on the management environment, management activities, financial status, etc. to the officers in charge of each operation, senior management and management.
• 5. Rules on handling insider information shall be fully communicated to all the officers and employees. When reporting to investors, etc., the existence of information equivalent to insider information shall be checked as necessary on individual matters.

Article 15 (Appropriate Collaboration with Stakeholders Other Than Shareholders)

The “TV Asahi Group Philosophy” and such position the establishment of appropriate relationships with various stakeholders as an important aspect and it is fully communicated to parties related to the Group. Based on the view that cultivating corporate culture and morals contribute to increasing corporate value, the Company shall aim to expand the spirit of corporate cultural reform to the entire Group, strengthen solidarity, and establish the Group’s brand in the current medium- to long-term management plan.

Article 16 (Appropriate Information Disclosure)

• 1. In order to ensure appropriate disclosure in accordance with laws and regulations, the Company shall clarify the person who assumes the final responsibility for information to be disclosed and its content by appointing one of the full-time officers as the information officer. In addition, in order to ensure that non-financial information is accurate and highly significant, relevant persons from the departments in charge of finance, administration and IR shall meet regularly to closely examine the content, exchange constructive opinions and make preliminary assessments on policies.
• 2. A summary of the management philosophy “TV Asahi Group Philosophy,” management strategies and management plans shall be posted on the Company’s website.

• Note: This is a direct translation of the Corporate Governance Guidelines released in Japanese. If there are any discrepancies between this and the original Japanese version, the original Japanese version prevails.