The third-party opinion presented here was prepared based on an exchange of opinions with my comments submitted during the report preparation process. In the opinion exchange, sincere responses were made to my comments, and I was assured that further improvements to the report would be made in the future. There were also examples of standard disclosures that do not accurately reflect reality, which provided me with significant insights and was very helpful. I would like to highlight the following three points that I highly evaluate in this report.

The first point is that the results of various reforms have been demonstrated along with our willingness to take on challenges. As Charles Darwin said, "It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change." In the midst of this fog, our past experiences of success are no longer applicable, and we are required to establish new management strategies and methods for their realization. With a sense of crisis that only companies truly needed by society will survive, the business structure reforms and management structure reforms indicated in our growth strategies respond to these demands and demonstrate that Denka is a company that can change. I believe many readers of this report will resonate with the message from Outside Director Fujiwara, who stated, "I feel a strong appeal in the Company as a developing growth enterprise."

2. Major Reforms in Environmental Matters The second point is that major reforms have been made in environmental matters. In the 2019 version, environmental matters were addressed as one aspect of ESG management, but in this report, they are positioned alongside growth strategies and business strategies, and are mentioned at the beginning of the strategies as environmental strategies. Although the specific meaning is not stated, this positioning brings to mind the SDGs wedding cake model. In other words, the economy is supported by society, and society is supported by the environment. We also responded to climate change by starting to work towards similar goals following Japan's carbon neutral declaration in October 2020. By combining forecasting and backcasting, I would like you to establish new goals for 2030 and 2040 and strengthen your efforts towards their achievement. Furthermore, you have expressed your support for the TCFD, and risks and opportunities have been verified through scenario analysis. From the next fiscal year onward, please accurately describe the four core elements (governance, strategy, risk management, and metrics and targets), and be aware that insufficient disclosure may involve risks.

3. The third point is that we have presented our Purpose (mission) with specific examples. In the section titled "Responsibility and Contribution," we have illustrated the Denka Group's issues and social responsibilities that we should fulfill based on the circular economy concept, focusing on SDGs Goal 12, "Responsible Consumption and Production." This allows readers to grasp our Purpose. The Purpose has become an important keyword in management. This is because it has been proven that employees who find meaning in their work perform better and grow exponentially. Placing greater importance on Purpose than on profit is essential for achieving sustainability. The IIRC (International Integrated Reporting Council) published a report titled "Purpose Beyond Profit," which indicates that companies with a Purpose are more profitable and have larger market capitalizations. I hope that all employees will read this report thoroughly and elevate their understanding to a level of conviction.

There is also an issue we would like you to consider in improving the quality of future reports. That is, "identifying materiality." The current materiality was identified in 2017 based on the GRI Guidelines and is generally considered to identify "critical CSR issues." Therefore, "to clarify the relationship with the Denka Value-Up management plan, starting in fiscal 2020, we have revised the definition of materiality from 'top priority CSR issues' to 'top priority management issues.'" We believe this definition will be well-received, and we encourage you to identify new materiality based on this definition. Incidentally, the IIRC framework also defines materiality as "an issue is significant if it has a substantial impact on the organization's ability to create value over the short, medium, and long term." Isn't this definition itself the definition of "top priority management issues"?

Furthermore, while the end of the pandemic is not in sight, I would like to ask that the 2021 report include a summary of your response to COVID-19. I believe that the ability to respond to pandemics is indicative of an organization's resilience and is essential information to include in an integrated report. The necessary items to include are, I believe, "Changes in the Management Environment and Responses," "Opportunities and Risks," "Infectious Disease Management Including Work Style Reform," and "Capital and Financial Strategies" in the context of the COVID-19 pandemic.