From Stability to Challenge: A Human Resource Strategy to Pioneer the Future

Leveraging the solid business foundation we have built over many years, the Tokuyama Group is now taking on the major challenge of transforming its business portfolio. The key to achieving this lies in talent equipped with creativity and diversity, who embrace change and continue to take on challenges. We will shape the future through the power of people and organizations.

The Tokuyama Group regards human resources as its most important management capital essential for sustainable growth. Based on this belief, in 2019 we specifically defined universal expectations for the kind of employees who will help realize our Vision, as well as the direction of their growth, in our Human Resources Policy. Since then, to keep pace with the ever-changing business environment, we have formulated human resources strategies aligned with our management strategy and have steadily implemented various measures under the resolutions and oversight of the Executive Committee and the Board of Directors.

For many years, we have built a stable business foundation through our traditional businesses such as chemicals and cement. However, going forward, we must reliably achieve the major challenge of transforming our business portfolio. To accomplish this, it is essential to shift away from a mindset premised on past stable growth and to foster and secure talent capable of taking on more creative challenges. In addition, we will actively recruit individuals with diverse knowledge and experience and establish systems and a culture that value diversity across the Group, thereby building an organization resilient to change.

Furthermore, we place great importance on creating a working environment and corporate culture in which each employee can feel motivated, enthusiastic, and contribute autonomously to our efforts. Through these initiatives, we aim to enable employees to take actions that embody our strategy and to increase corporate value through their growth.

We will continue to steadily execute human resources strategies based on our management strategy and realize human capital management that earns the trust of all stakeholders while enhancing corporate value.

Human Resources Policy

Developing Talent to Lead the Future — Tokuyama's Education Framework

We regard the development of talent who embraces challenges as a driving force for corporate growth. In addition to a systematic education program that combines OJT (on-the-job training) and OFF-JT (off-the-job training), we are actively promoting strategic investments in human capital to foster next-generation leaders and cultivate diverse talent.

Tokuyama promotes a systematic approach to human resource development by combining the enhancement of skills and mindset through daily work via OJT with hierarchical and specialized training through OFF-JT. In OFF-JT, in addition to rank-based training under the role-qualification system, we provide compliance education aimed at fostering cultural reform and ensuring legal compliance, as well as specialized education for technology transfer, safety management, and business transformation. We also support employees' self-development and encourage autonomous growth by subsidizing the cost of obtaining public qualifications and correspondence courses.

Furthermore, as part of developing talent to support business portfolio transformation, we conduct the "Next Business Leader Training (NBL Training)" program for future management candidates. Since its launch in fiscal 2018, approximately 70 employees have completed the program by fiscal 2024, including diverse talent such as mid-career hires and women.

The program leverages external resources in a practical and proactive manner, emphasizing outward-looking content. Some graduates of the program are now subject to strategic rotations under the new personnel system introduced in fiscal 2025, with the aim of accelerating their development into management leaders. Going forward, we will continue to foster talent that can take on challenges and create an environment where they can thrive, thereby supporting the company’s sustainable growth.

Supporting Challenge and Contribution — Tokuyama's Human Resource System

As part of its talent strategy to support sustainable corporate growth, Tokuyama implemented a comprehensive revision of its human resource system in May 2025. The new system is designed to enable employees who embrace challenges to fully demonstrate their capabilities by shifting to a framework that rewards the value and results of their work.

In May 2025, Tokuyama implemented a comprehensive revision of its human resource system as part of a talent strategy aligned with its business strategy, designed to support the development and growth of employees who embrace challenges. Under the concept of "Pay for Job," the new system shifts from age- or attribute-based treatment to a framework that rewards the value and results of the work performed.

This reform eliminates age-based pay and personal allowances, establishing a system grounded in fair evaluation and treatment based on performance and behavior, with the aim of enhancing job satisfaction and maximizing corporate value. In addition, allowances such as family allowances—previously received primarily by male employees—have been abolished to ensure equitable treatment regardless of gender, while reinforcing a compensation structure based on individual results and promoting greater opportunities for women.

Furthermore, a dual-track career system has been introduced to reflect job type and responsibilities, along with mechanisms to encourage ambition, such as incentives for employees participating in strategically important projects. The required tenure for promotion to each qualification grade has also been shortened, enabling the early advancement of high-performing young employees and helping those who have taken maternity or childcare leave to recover career progression.

Through this system, which ensures fair evaluation of performance and behavior, we aim to boost employee motivation and engagement, enabling high-performing talent to drive business growth with greater productivity. By creating an environment where employees who embrace challenges can thrive autonomously, Tokuyama will continue to strengthen its foundation for sustainable growth and enhance corporate value as a driving force for the future of the Tokuyama Group.

Promoting Diversity

Tokuyama is committed to fostering a vibrant and inclusive workplace where all employees can work energetically and achieve success. We place a high value on diversity of knowledge and wisdom, and through ongoing organizational culture reform, we strive to create workplaces that are both pleasant and motivating, while also aiming to enhance productivity.
The Company actively pursues a target of at least 20% female representation among new hires (university graduates and above) each year. In line with this, we are also implementing continuous measures to achieve a future goal of 20% female representation across the entire workforce.

In 2025, we revised our compensation system to establish a fair framework based on job performance, regardless of gender. This initiative is helping to correct disparities in treatment between men and women, and we will continue to pursue further improvements going forward.

As Tokuyama Co., Ltd., we have formulated an Action Plan based on Japan's Act on the Promotion of Women's Active Engagement in Professional Life, and are working to achieve the following targets by the end of March 2028, including the percentage of women in managerial positions:

①Maintain a female hiring ratio of 20% or more for university graduates and above (three-year moving average)
②Aim for 6% or more women in managerial positions (section manager level and above)
③Maintain an annual paid leave utilization rate of 75% or more for all employees

To achieve these goals, we are striving to create a work environment that is supportive for women. Specific initiatives include implementing e-learning programs to raise awareness of unconscious bias, creating a "Guide to Maternity and Childcare Leave" to encourage male employees to take childcare leave, and providing training for female employees on health issues unique to women. In addition, through "Tokuchalle" activities, we promote themes that contribute to a gender-neutral work environment, such as "Working Parents! Everyone's Tokusapo."

Furthermore, to accelerate the promotion of women's participation across the Tokuyama Group, we have set a voluntary goal to increase the ratio of female managers to 15% or more by fiscal year 2030.

To foster an organizational culture where diverse talents can thrive, we conduct lectures on the importance of diversity as part of our new employee training program. With respect to the employment of persons with disabilities, the Company strives to achieve the statutory employment rate and is working to develop the workplace environment, including accessibility through barrier-free initiatives. We have also launched new initiatives, including opening You You Terrace as a facility for people with disabilities and establishing the agricultural corporation Tokuyama You You Farm Co., Ltd., which supports the independence of people with disabilities and contributes to the local community.

Work-Life Balance Support Programs

At Tokuyama, employees in workplaces eligible for flextime can choose their workday schedules with no core work-period requirement. The Company is also striving to optimize working hours by tracking and presenting aggregate data based on thecomputer log details of employees, enabling actual working conditions to be managed.

Under a program to help employees balance work and childcare responsibilities, eligible employees can use shortened working hours from 10 weeks before childbirth until the child starts elementary school, ^＊1 and can also use flextime from the time that pregnancy is determined until the child reaches sixth grade. Paid parental leave is available from birth until the infant reaches age one. Tokuyama provides eligible employees and their managers with paid parental leave information to facilitate the use of leave. Childcare leave is also available until the infant reaches age two.^＊2 As a result of these various efforts, we received "Platinum Kurumin Certification" from the Minister of Health, Labor and Welfare on July 19, 2022, as an excellent childcare support company.
The uptake of parental leave and childcare leave among male employees is also becoming more established, with over 100 employees taking such leave each year.

Employees can also take family care leave for up to two years (legal requirement: 93 days in total) for each family member requiring care. With family care time off (unpaid), regardless of the number of care recipients, it is possible to take off two days a week (legal requirement: five days a year).

To support those on childcare and family care leave and help them eventually make a smooth transition back to work, internal information is shared with them on the intranet. In addition, an employee reinstatement system has been established to allow employees who resigned for childcare or family care reasons to be rehired.
＊1. Legal requirement is the age of three.
＊2. Legal requirement is the age of one. In certain cases, leave can be taken until the child reaches age two.

* A cirtain number of accumulated annual paid leaves that have expired.

※ Examination leave, prenatal and postnatal leave, and childcare time are programs exclusively for women

Employees Data