Message from the Chair of the Board of Directors

Ever since the Corporate Governance Code was published, Joshin has continuously worked to bolster our governance structure for the sustainable enhancement of corporate value. At the Annual General Meeting of Shareholders in June 2025, the Company transitioned to being a company with an Audit and Supervisory Committee structure, and the Board of Directors was also reborn as a diverse and independent body in which outside directors account for 75.0% and female directors for 50.0%. These reforms are not limited to institutional changes, but are rather positioned as building the foundations for further enhancing strategic discussions and oversight at the Board of Directors as we steadily implement the JT-2028 Management Plan (our new medium-term management plan) to sustainably increase growth and corporate value as the new Joshin.

One year has passed since this transition, and we have started full-scale operation of the new structure that both speeds up executive actions and improves the supervisory function of the Board of Directors by largely delegating decision-making authority over business execution to the Board of Executive Officers. At the Board of Directors, a foundation is steadily being laid for deeper discussions on medium- to long-term strategies, capital policies, and management resource allocation, drawing on the diverse expertise of our outside directors. However, since this was the first year after our transition, it became obvious that issues remain for further improvement. These include the division of supervisory and executive roles; the presentation of strategic significance, investment effects, and risk assessments in proposals; the implementation of PDCA in alignment with our KPIs; and the provision of a mechanism that reflects feedback from the market back into management. We recognize that the transition to being a company with an Audit and Supervisory Committee is not the end point of our governance reforms, but rather the starting line for efforts to further raise the effectiveness of the Board of Directors.

In the future, instead of making decisions about individual business actions, the Board of Directors will concentrate on holding deeper discussions about the important themes that will contribute to increasing medium- to long-term corporate value. Specifically, we will focus on checking medium- to long-term strategies, capital efficiency, management resource allocation, and the appropriateness of risk-taking as we seek to create an environment that supports swift and decisive decision-making by executives. We are also making improvements to reference materials used in discussions, organizing strategic significance, investment effects, and risk assessments from both quantitative and qualitative perspectives. This helps the Board of Directors to make decisions from a big-picture viewpoint. Furthermore, input gained from discussions with shareholders and investors is fed back appropriately to the Board and leveraged to improve capital policies, growth investments, and information disclosures so that constructive dialogue with capital markets will lead to enhanced corporate value.

FY2026 is the year in which the JT-2028 Management Plan is launched in earnest. The key themes of the JT-2028 Management Plan are renewing growth in the home appliances business, enhancing points of contact with customers through stores, e-commerce, and the use of data, and expanding into growth areas from the starting point of home appliances. The Board of Directors will review whether these strategies are contributing to the realization of the new Joshin’s vision of becoming a “local electronics store that is also a mass retailer,” while continuously monitoring KPI progress, investment effectiveness, capital efficiency, and the appropriateness of management resource allocation. If any delays or issues occur in the plan, we will check the cause and urge the necessary course corrections to increase the likelihood of successfully implementing the JT-2028 Management Plan.

In my role as Chair of the Board of Directors, I am committed to achieving both fast business execution and effective oversight by the Board, as we seek to leverage the endeavors of the new Joshin into a sustainable increase in corporate value. To meet the expectations of all our stakeholders, we will steadily implement governance reforms that will help raise corporate value through the further advancement of the Board of Directors and the building of a highly transparent management structure.