Kao : Releases Progress Reports on its ESG Strategy —the Kirei Lifestyle Plan

TOKYO, May 24, 2024-Kao Corporation, a Japan-based Group whose brand portfolio includes Attack, Bioré, Goldwell, Jergens, John Frieda, Kanebo, Laurier, Merries, and Molton Brown, has released a progress report on its ESG (Environmental, Social, and Governance) strategy-the Kirei Lifestyle Plan in the Kao Sustainability Report 2024. In 2023, with biodiversity an urgent global-scale issue, Kao amended its policy on biodiversity and carried out information disclosure according to the TNFD^*1 framework. The company also continued activities relating to respect for human rights, which is the foundation of all corporate activity, including formulating its Diversity, Equity and Inclusion (DE&I) Policy. With regard to palm oil, one of the main raw materials used by Kao, the company is aiming to establish traceability throughout the supply chain, down to oil palm plantations, in order to ensure sustainable procurement of resources. The progress report also includes quantitative data on results of Kao's ESG activities, contributions to its financial results and envisioned future growth, describing the contributions of its ESG strategy to its Mid-term Plan 2027 (K27). The following outlines the results of new 2023 activities for Kao's key leadership action themes.

• *1 The Taskforce on Nature-related Financial Disclosures officially launched in 2021 in order to build a corporate risk management and disclosure framework related to the resources of nature.

• Kao Sustainability Report 2024

Kao's ESG Strategy Kirei Lifestyle Plan

For over 130 years, Kao has worked to help consumers lead fulfilling lifestyles. In April 2019, Kao established the Kirei Lifestyle Plan, which is an ESG strategy that includes 19 leadership action themes to achieve a sustainable and desirable way of living. The Japanese word 'kirei' describes something that is both clean and beautiful. For Kao, Kirei not only encapsulates appearance, but also attitude-to create beauty for oneself, other people, and for the world around us. Since 2021, Kao has been promoting the Kao Group Mid-term Plan with its vision of "protecting future lives" and "sustainability as the only path." The Kao Group will continue to integrate its ESG strategy into its management practices. It will also develop its business, provide better products and services for consumers and society, and work toward its purpose "to realize a Kirei world in which all life lives in harmony."

The Director, Managing Executive Officer in charge of Kao's ESG Division, Dave Muenz, delivered this message regarding the announcement of progress of the Kirei Lifestyle Plan: "At Kao, we strive to optimize our business operations across the value chain through ESG-focused Yoki-Monozukuri, and bring value to our communities through solutions to social issues. Our ESG strategy the Kirei Lifestyle Plan puts the consumer at its center, illustrating the direction of our action and setting ambition targets. Based on this, in 2023, we accelerated our initiatives looking towards our mid-term plan K27 with the visions of 'sustainability as the only path' and 'protecting future lives'. In the Kao Sustainability Report 2024, we share our progress in the three commitments of the Kirei Lifestyle Plan looking towards the year 2030, as well as new efforts to promote the Kirei Lifestyle. This includes the publication of the Action Policy on Biodiversity and disclosure based on the TNFD framework, driving forward in human rights and DE&I, and efforts towards further transparency. Aiming to clarify how our ESG strategies contribute to the mid-term plan K27, we have worked to demonstrate the impact of our ESG activities financially and otherwise, as well as expected future growth. As the transition to a more sustainable society accelerates, at Kao, we will strive to embed sustainability into business to succeed in both ESG and Economic Value Added <_evac2ae_>^*2 ."

• *2 Stern Stewart & Co.: Developed EVA in theory and applied it to corporate EVA management. Registered EVA as a trademark

These efforts have been recognized by the CDP, a leading international nonprofit organization, which included Kao in its prestigious 'A List' in all surveys across the three categories of climate change, forests and water security for four years in a row. Kao is one of only 10 companies included in the top-rated 'A List' across the three categories, out of more than 21,000 companies determined by a global survey of businesses and an evaluation of their activities. In addition, the Ethisphere Institute, a leading US think-tank, has named Kao one of the World's Most Ethical Companies® for 18 consecutive years.

• News Release from February 2024
  Kao Rated Triple-A for Climate Change, Water Security, and Forests for Fourth Consecutive Year by CDP

• News Release from March 2024
  Kao the Sole Japanese and Asian Company Included in the World's Most Ethical Companies® List for a Record 18th Consecutive Year