P.55 Corporate Governance (Nomination and Remuneration Advisory Committee)

55 02. Foundations for Accelerating Transformation

Corporate Governance

Nomination and Remuneration Advisory Committee

Committee activities ▍Committee composition

The Nomination and Remuneration Advisory Committee is chaired by an Outside Director, and three of its five members are Independent Outside Directors, ensuring the Committeeʼs objectivity. The primary reason for including Internal Directors on the Committee is to enhance the quality of its deliberations. In addition to merely providing information, senior internal executives, who are thoroughly familiar with the Companyʼs business characteristics and corporate culture, offer their opinions on the design of the system in their capacity as Committee members. Their involvement helps reduce information asymmetry between internal and outside members while creating a highly effective framework that integrates external indicators with internal realities. When matters concerning an individual member are discussed, that member does not participate in the deliberations.

<Key matters reviewed by the Committee>

• FY2026 Director and Executive Officer appointments (including Management Council appointments and talent deployment based on the succession plan)
• FY2024 individual performance evaluations of Executive Officers
• President and CEO succession plan
• Restricted performance share unit–based remuneration for executives (review of non-financial indicators, performance levels, and remuneration structure)
• Systematization/implementation of the President and CEO evaluation system

Succession planning

▍President and CEO requirements and qualities

The Company defines the criteria for selecting its President and Chief Executive Officer as embodying Sumitomoʼs Business Philosophy and possessing the necessary qualities and capabilities. To systematically develop a pool of such talent, the Company actively provides a range of opportunities, including job rotations and assignments that offer global and diverse business and management experience, as well as training programs.

President and CEO selection criteria

▍Selection process

Taking into account the Presidentʼs term of office (which, in principle, does not exceed six years), Nomination and Remuneration Advisory Committee Members and other relevant parties share a schedule leading up to the anticipated transition period following the Presidentʼs appointment. The current President prepares the candidate list, and the Nomination and Remuneration Advisory Committee monitors succession planning by reviewing and updating the list each December. The Nomination and Remuneration Advisory Committee, chaired by an Outside Director, deliberates on the selection criteria and succession plan, with the Board of Directors making final decisions. This process ensures objectivity and transparency.

1 Develop succession planning roadmap 2 Define President and CEO profile and evaluation criteria 3 Identify successor candidates 4 Develop and implement a development plan 5 Evaluate, refine, and update the successor candidate pool (annual monitoring) 6 Evaluate final candidates and select the successor Following discussion and nomination by the Committee; approved by the Board of Directors

Executive remuneration

▍Remuneration structure

• Executive remuneration (within the maximum amount approved by the General Meeting of Shareholders) is reviewed by the Nomination and Remuneration Advisory Committee and submitted to the Board of Directors for resolution.
• Remuneration for Executive Directors and Executive Officers consists of (1) Monthly remuneration, (2)

Performance-linked bonus, and (3) Restricted performance share unit–based remuneration. Remuneration of the Director, Chairman, whose main role is management supervision and engaging in external relations activities as stipulated in the Sumitomo Corporation Corporate Governance Principles, consists of restricted performance share unit–based remuneration designed to enhance shareholder value, in addition to monthly remuneration. Remuneration of the Director, Vice Chairman is structured in the same manner. Remuneration of Outside Directors who are not Audit & Supervisory Committee Members consists solely of fixed monthly remuneration, reflecting their role in supervising management with a high degree of objectivity and independence.

• Remuneration of Directors who are Audit & Supervisory Committee Members also consists solely of fixed monthly remuneration, reflecting their role in supervising management with a high degree of objectivity and independence. The specific remuneration amount is determined through discussions among the Directors who are Audit & Supervisory Committee Members, within the maximum amount approved by the General Meeting of Shareholders.