P.8 Message from the President and CEO

8 Introduction

Message from President and CEO

Q2.

How will you transform the Groupʼs business portfolio and deliver sustainable growth?

I am sometimes asked what kind of portfolio we are aiming to build. We will concentrate our management resources on “core- strength” businesses in growth areas where we can leverage our strengths. At the same time, there is no guarantee that we can maintain our strengths indefinitely. We must carefully assess the changes taking place around the world and seize the growth opportunities they present. We must broaden the areas where we can leverage our strengths while developing new ones. By doing so, we will build a sustainable and resilient business portfolio. That is the answer I give when asked about the portfolio we are aiming to build. The acquisition of a U.S.-based aircraft leasing company and the full acquisition of SCSK are examples of how we have been allocating management resources to our “core-strength” businesses. SCSK, in particular, will play an extremely important role in executing our Digital & AI Strategy (DAIS). By combining SCSKʼs expertise with the Sumitomo Corporation Groupʼs business operations spanning approximately 900 companies and its global customer base of around 100,000 companies, we will accelerate growth across the entire Group. Itʼs also important to develop our next winning strategies. In addition to sharpening our current competitive advantages, we are working to develop businesses that will become future pillars of earnings. To this end, we are investing around 20% of our initial investment plan in new areas with growth potential. We will build on our current strengths while developing new avenues for success. This cumulative effort will lead to growth over the medium to long term. Underpinning this business portfolio transformation is the “self-direction and self-discipline” of each organization. The important thing is for those on the frontlines, who know their businesses best, to take ownership in assessing growth potential and risks, formulating strategies, and executing them. If a business has future potential, we persist with it. If it does not, we do not cling to it. Through these efforts, we will continue evolving our business portfolio and pursue our ambition̶growth beyond the ¥600.0 billion profit level.

Q3.

How do you assess the decision to withdraw from the Ambatovy nickel project?

We have been closely involved with the Ambatovy nickel project for many years, since we first began considering the project internally in 2005. I have been directly involved since 2019, first as General Manager of the Mineral Resources, Energy, Chemical & Electronics Business Unit, and since 2024 as President and CEO. As management, we take seriously the significant cumulative losses incurred and the concern this has caused our stakeholders. At the same time, the project has created around 9,000 jobs and played an important role in Madagascarʼs economy and local communities. For this reason, we have remained committed to pursuing both the long-term sustainability of the business and our responsibilities to society. Beginning in 2024, we explored every possible option̶including continued operations, a sale, mine closure, care and maintenance, and bankruptcy̶while keeping our social responsibilities foremost in our minds. Ultimately, we chose to transfer the business to a consortium led by Essenwood Partners, which possesses both the technological expertise and financial resources required. I believe this was the best option from both economic and social perspectives. The Ambatovy project was much more than a simple nickel mining operation. Madagascar lacks well-developed industries supplying equipment and materials, raw materials, energy, and other essential inputs, making it difficult to procure sufficient supplies domestically. As the project involved not only mining but also smelting, we had to build and operate the necessary infrastructure ourselves, including sulfuric acid and hydrogen plants, on-site power generation facilities, ports, and logistics infrastructure. This made it an extremely complex undertaking, where a problem in any one part of the operation could affect the entire project. While confronting these challenges, we worked persistently to stabilize operations and strengthen the projectʼs business foundations. We wanted to ensure that our efforts were carried forward by finding a way to keep the business operating, and I believe we were able to do so. That is why I do not view the divestment as simply a withdrawal from the project. I believe that transferring the business while fulfilling our responsibilities to local communities, rather than focusing solely on economic value, embodied Sumitomoʼs Business Philosophy. This approach to business has earned recognition from a number of global companies, some of which have approached us about working together. I believe it demonstrates the trust we have built with them.