Toyota Tsusho : Business Reports of FY2022

The following is an unofficial translation of the Japanese-language original version, and is provided for your convenience only, without any warranty as to its accuracy or as to the completeness of the information. The Japanese original version of the notice is the sole official version. If there are any discrepancies between the Japanese original version and the English translation, the Japanese original version prevails and the company disclaims all responsibility for and results of the discrepancies.

To Our Cherished Shareholders

Toyota Tsusho is deeply indebted to all of its shareholders for their continued kindness and encouragement.

Our company plans to convene its 102nd Ordinary General Meeting of Shareholders as described on the following page. Please accept this letter as a notice of convocation.

Although the outbreak in early 2020 of COVID-19 has changed our lifestyles and ways of working, economic activities are finally returning to pre-pandemic levels as we have become accustomed to coexistence with the coronavirus, with many countries around the world lifting entry restrictions and easing regulations. On the other hand, with rising geopolitical risks, including the situation in Russia and Ukraine, the continuing further acceleration of energy price hikes and commodity shortages, and the expansion of inflation worldwide, the global economic outlook is expected to remain uncertain.

The business environment surrounding us is changing with unprecedented scope and speed, as exemplified by the wave of the Fourth Industrial Revolution driven by digital transformation, the global movement toward a decarbonized society, and geopolitical risks affecting supply chains. Under these circumstances-and viewing change as not representing risk but opportunity, we feel that the time has come for us to envision the future, advance to our next stage, and take on new challenges.

To this end, the Toyota Tsusho Group will accelerate innovation to create new added value, establish business domains that are distinctly Toyota Tsusho, and make company-wide efforts to achieve carbon neutrality and realize a circular economy under the slogan: "Passing on a better global environment to the children of the future".

Through these activities, we aim to be an irreplaceable presence for our customers, suppliers, partners, shareholders, communities, and future society around the world. In other words, we aim to achieve our global vision of "Be the Right ONE".

I would like to express our company's sincere gratitude to all of our shareholders for their understanding and backing of the Toyota Tsusho Group, and I humbly request your continued support.

Sincerely yours,

Ichiro Kashitani

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We in the Toyota Tsusho Group deliver to nations around the world a diverse range of products and services essential for building prosperous and comfortable societies.

We are guided by a four-tier philosophy that enables us to successfully meet the challenges of each new age.

Unchanging ideals that should be passed on to the future

Goals and milestones we should reach as we continue pursuing and realizing our fundamental philosophy

The Toyota Tsusho Group Way (Toyotsu Group Way)

The bedrock principles that all Toyota Tsusho Group employees should share and the values that should be embodied in their actions to realize our fundamental philosophy and achieve our vision

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Global Vision −Established in 2016−

Our Global Vision sets the direction of the Toyota Tsusho Group's continued evolution as a true global company. It sets forth guidelines to which our entire global workforce should aspire.

	Global Vision	−	Ideal Image			The Right ONE for you
The Toyota Tsusho Group will evoke our ideal as
						The best assurance of safety, service, quality and reliability
						based on your needs (Genba)
						The Right ONE for us
						Maximization of individual capabilities, global networks and
						diversity to create synergistic strengths
						The Right ONE for future
						Unique insights and capabilities to explore new possibilities
						for future and sustainable society
	Global Vision - Toyotsu Core Values
						Under our Global Vision, we have made a more
						explicit commitment to emphasize the importance of
						an environmental consciousness, and our
						contributions to a convenient, comfortable, healthy
						and sustainable society.
						Mobility
						A focused field that contributes to future convenient
						society
						Life & Community
						A focused field that contributes to comfortable &
						healthy society
						Resources & Environment
						A focused field that contributes to sustainable society

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Toward Sustainable Growth

Key Sustainability Initiatives for the Toyota Tsusho Group

The Toyota Tsusho Group has identified six Key Sustainability Issues (Materiality) that it needs to be aware of as it pursues the realization of its corporate philosophy and Global Vision to clarify those social issues that it needs to focus on based on its management strategies.

Materiality is incorporated into the strategy of the divisions, and each division reports on their progress to the Sustainability Management Committee, and conducts a review as appropriate, taking into account changing trends in international society, environmental changes for the Toyota Tsusho Group, and so on.

To facilitate visualization of the impact of the Company's business activities on sustainable development themes, we have formulated medium-term KPIs for each materiality issue, and will apply the plan-do-check- act (PDCA) cycle.

Both the company and employees are achieving sustainable growth and contributing to solutions to social issues and the realization of the Sustainable Development Goals (SDGs) by each employee engaging in business activities with an awareness of these Materialities.

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Setting our Sights on Carbon Neutrality

The Toyota Tsusho Group's carbon neutral declaration

Decarbonization is one of the Toyota Tsusho Group's material sustainability issues, and the Group as a whole is currently working towards the goal of carbon neutrality. As a concrete policy geared towards contributing to the transition to a decarbonized society, in July 2021 we formulated a 2050 carbon neutrality target with an initial goal of achieving a 50% reduction in the volume of greenhouse gas emissions (Scopes 1* and 2*) generated through the business activities of the Group (Toyota Tsusho Corporation and its consolidated subsidiaries in Japan and overseas) by the year 2030 compared to 2019 levels.

The Group aims to achieve this goal by making an all-out effort to promote energy saving and the use of renewable energy by, for example, switching to LED lighting at offices and plants and installing solar power generation equipment on the rooftops of the buildings we own. In addition, the Group will work to reduce greenhouse gas emissions by changing the types of fuel used in production processes and logistics operations, consuming fuel more efficiently, and minimizing emissions through technological innovation.

A strength of Toyota Tsusho Group is that we are able to accelerate and drive forward, on a Group-wide basis, businesses that contribute to reducing greenhouse gas emissions throughout industrial life cycles. All Group employees will make a concerted and committed effort to help address societal issues.

*Scope 1: Greenhouse gases emitted directly through the Group's own fuel consumption (coal, gas, etc.).

*Scope 2: Greenhouse gases emitted indirectly through the use of purchased electricity and heat.

Reduction target

We aim to be carbon neutral by 2050

We aim for a 50% reduction in GHG by 2030 compared to 2019

Included: Parent company, domestic and overseas consolidated subsidiaries (Scopes 1 and 2)

*Scope 3 promotes specific initiatives with suppliers and customers to reduce GHG emissions throughout the value chain.

CO2 converted emission amount (thousand t-CO2)

Benchmark year		50% reduction		Carbon neutrality

-50%

Neutral

CCUS (Carbon dioxide, Capture, Utilization and Storage), etc.

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