Message from Outside Directors: Yoshinobu Fujimoto

Since beginning my career as an attorney in 1991, I have focused primarily on corporate law, M&A, and international transactions. After studying abroad in the United States, I also obtained a New York State bar license, and have since been involved in numerous overseas cases. I have been associated with artience since around 2000, providing legal support for international cases, including the acquisition of local subsidiaries in Belgium and Turkey. In particular, in 2010, I worked closely with the current president, Mr. Takashima, on a very challenging case involving the US Department of Justice, which helped to build a strong trusting relationship between us. Since then, I have continued my involvement with the Company in various capacities, and in 2024 I was approached to join its Board of Directors. Having gained a deep understanding of artience through many years of work, and recognizing this as an opportunity to contribute by leveraging my legal expertise, I accepted the role of outside director.

My initial impression of the Board itself was that it was somewhat cautious and rigid, but now its membership has changed significantly, and the depth of our discussions has increased dramatically with the addition of new outside directors with expertise in management and finance. Recently, our Board meetings have been so lively that discussions cannot be concluded within two hours.

In order for us to exercise our voting rights as outside directors appropriately, it is essential for us to know the Company well. In FY2024, I made multiple factory visits. I found it highly beneficial to gain firsthand insights from the front lines. I also consider it meaningful that my proposal to create informal opportunities for open dialogue with the management team outside of formal board meetings was adopted and implemented.

It is also essential that outside directors have a proactive attitude and take the initiative in accessing information. Rather than demanding excessive documentation from the secretariat, I believe it is possible to enhance our supervisory function more efficiently by sharing existing management meeting materials and participating as observers in internal meetings.

In terms of business performance, ROE has been steadily improving, and it is our assessment that the Company has made a solid start from the first year (of the plan.) The decisions to change the company name, revise the philosophy framework, and undertake cultural reforms were all driven by a strong commitment by management to transform the Company. The key question going forward will be how to infuse real passion into the plan targets and execute them effectively. Particularly in non-financial areas such as human capital and sustainability, where targets and evaluations tend to be more qualitative than quantitative, there is a need to engage in practical efforts and translate them into tangible results.

In addition, artience is now a company where both sales and profits from overseas markets exceed 50% of total sales and profits. While the domestic (i.e., Japanese) market offers a relatively stable business environment, expanding overseas operations brings various risks. I believe that it will become increasingly important to respond quickly and accurately to changes in policies and regulations that vary between countries and regions.

artience is a serious and sincere company that is committed to ESG and sustainability. However, its PBR is currently below 1, and I feel that external recognition is yet to catch up with its efforts. The issue of how to communicate the value the Company offers is an IR/SR issue that must be addressed with an even greater level of care.

The role of outside directors goes beyond mere monitoring. The essence lies in how effectively we can contribute to sustainably enhancing corporate value by leveraging our expertise and experience. Personally, I hope to contribute to artience’s value creation by making full use of my legal expertise, as well as all available resources and networks. In particular, as artience strengthens its efforts toward global expansion, it will face increasing challenges in addressing complex legal systems and risks. In such situations, I will strive to provide sound advice that will lead to better management decisions.