Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 162 Education and promotion for our a source of vitality diversity In order to make of the meaning of are spreading awareness organization, we needed and information the knowledge D&I, and providing are significant differences in the to put it into practice. There issues and in the relevant current state of diversity being performed, etc., depending on the nature of the work or unit. and depending on the individual group company to properly it possible aim to make this in mind, we With identify the issues relating to D&I promotion and to as to enable formulate and implement related plans, as well in relation to realize improvements each individual employee need to take. to the action that they Policies personalities and values of diverse By including the individual passion and employees’ and by developing employees, invigorate our can we extent, capabilities to the maximum as a capabilities. Taking its overall organization and enhance of trust that has been formed through foundation the relationship and employees, management between smooth communication which employees to create an environment in are working we an culture and with enthusiasm, and can focus on their work use of effective to make strive environment in which employees and in which people in their work, experience diverse their own their utmost. for doing are properly rewarded feel that they organizational and personal growth. of aim to realize a virtuous circle these efforts, we Through 102-12, 102-15, 103-1, 103-2, 404-2 103-2, 103-1, 102-15, 102-12, Risks related to realization of our vision by 2030 of our vision by to realization Risks related to employ that a company that is unable believe We it difficult to find would human resources diverse in employee A decline continuous growth. achieve increase in the number of enthusiasm and an as difficulty as well the company, leaving employees the prevent in recruiting talented people, may overall company from fully demonstrating its capabilities. of our vision to realization Opportunities related 2030 by to the enthusiasm, contributing Increasing employee a global presence and expressing growth company’s inclusion (D&I) and within the promotion of diversity the company enhance the value that society perceives employee the pool of future and expand as providing for Kao. to work candidates who want Contributions to the SDGs

regardless of personal attributes can work employees where environment the work will improve We gender orientation, sexual gender, (such as nationality, age and disability), and promote support for identity, with childcare, nursing care, or family balancing work the comfort of all care with the aim of improving and maximizing the results of our operations. employees Kao’s creating value Kao’s creating the with different backgrounds By giving employees by pooling the opportunity to fulfil their potential, and can we capabilities of each individual employee, of our enhance the creativity and innovation products organization, and can continue to provide than higher satisfaction and services that realize even of urgency. in the past to customers with a sense Social issues we are aware of aware are Social issues we are undergoing significant Social values and lifestyles In addition, as business changes and are diversifying. economic and social uncertainty becomes globalized, has increased. the number of employees while dealing with problems in their In this changing society, who are working of employees and so is the number is growing, lives who need to adopt different workstyles. a business enterprise to realize sustainable of it is vitally important to be accepting For growth, a proactive and also to adopt employees, diverse social change. approach toward Kao’s creating value to address social issues to address value Kao’s creating Kao believes that the vitality derived from diversity can create new value for society. To this end, as a company, we strive to have all employees to maximize all employees to have strive we end, as a company, this To society. for value create new can diversity from vitality derived that the Kao believes to their abilities and to combine employees, of individual values and personalities the diverse culture that accepts an organizational and skills in their passion capabilities. our overall enhance diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 163 I Promotion Plans. & * As of December 2019. I awareness-raising activities. I awareness-raising & Human Capital Development and responsible for Human Capital Development Persons career coordinators in each division and group company Department Career Development Kao Corporation’s Making proposals on and discussing the recruitment, assignment, Making proposals on and discussing the recruitment, assignment, human capital. cultivation and appointment of diverse Confirming the PDCA cycle in relation to D cycle Confirming the PDCA Reporting D Implementation of human capital strategy through line through Implementation of human capital strategy Human Capital Development Meetings, once monthly Human Capital Development Details appropriate at topics are addressed when following The related matters meetings where human capital development information is shared. are discussed and relevant Hosting organization Members Secretariat ・ ・ ・ and from major group of Kao Corporation from nine and personnel Responsible managers worksites of the dissemination undertake companies and plan and regarding D&I promotion information events. implement related Activity held D&I Awareness 2018, we Up until participants reported on examples Meetings at which shared information about the of best practice and ways examining now are latest D&I-related topics. We can respond so that we to adjust this system issue in line with the appropriately to each organizations. In 2019, circumstances at individual at individual organizations the responsible managers topics. approached in relation to specific were sharing Information Employees I & I. & Conveying opinions Conveying opinions 102-43, 103-2 102-43, I Promotion Office & Responsible personnel in the Employee Welfare Welfare Responsible personnel in the Employee Committee at individual Kao Corporation or human resource managers worksites responsible for human resources or Personnel Welfare in the secretariat of the Employee Committee of group companies D KCMK’s Human Capital Development ・ ・ ・ of information of information Dissemination Dissemination I Awareness Activity Meetings, once annually I Awareness & Employee Welfare Committee, events, etc. Committee, events, Welfare Employee Sharing of implementation content based on the D Sharing of implementation content based on the Provision of information relating to D Provision D Awareness-raising Plan. Awareness-raising Details Hosting organization Members ・ ・ I promotion activities D&I promotion for Framework specialized organization in Kao Group Customer Group Customer organization in Kao specialized Group, and with the Co., Ltd. (KCMK) Marketing capital development for human persons responsible broadly division, we company and in each group opinions, and deliberate, share information and the Human Capital Development through meetings of individual meetings. Committee and other and implement D&I promotion formulate of our companies and divisions within At each Japan, we analysis of the current situation in plans based on an so as to promote the diversification each organization, build organizations that are of human capital and realize aim to we In this way, accepting diversity. continuous improvement.

We are working to promote the recruitment, are working We human capital cultivation and appointment of diverse building a in each of our organizations, while also the fostering of a corporate in which framework culture, that values D&I, can be promoted on multiple levels. among diversity Matters relating to promote for the group management candidates and strategies Capital as a whole are discussed by the Human of executive Committee, which consists Development officers. Kao Corporation has a special-purpose D&I organization to promote and firmly established throughout the group. Collaborating with a Given the rapid pace at which society is diversifying, at which society is diversifying, the rapid pace Given within of views exchange just relying on the internal constitute an adequate the company will not in mind, in regard to activities that this response. With are striving momentum, we are strengthening social in participation attitude toward a proactive to take agree with their where we such activities, in cases of the study participated as a member have goals. We various agencies and groups of government organizations, giving corporate case study and arranging presentations at lectures and seminars etc. when possible. tours of our special subsidiary, Framework Collaboration and engagement and engagement Collaboration with stakeholders diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 164 Reviews of performance Reviews engaged in more in-depth In 2019, we the discussions with top management regarding and the meaning of Kao’s definition of diversity the D&I promotion activities. Through will be summarizing of these discussions, we new formulating a more concrete picture of our have in 2020. In line with this, we D&I initiatives new amended the original plan for rolling out throughout the whole group, including initiatives take so that this will now worksites, overseas place from 2020 onwards. Performance in 2019 Performance Performance and divisions are Individual group companies that address their proceeding with measures issues. respective to address issues implementation of measures Japan, besides the steady Within also have we attributes, relating to employee attributes employee sorted out issues including which segments can determine etc., so that we on strengthening need to focus and content we measures for in the future. discussions with top management regarding the fundamental also implemented several We meaning of D&I promotion within the organization. 103-2, 103-3 103-2, continuity and the enhanced creativity, can be can creativity, and the enhanced continuity expected. Social impacts are value, and we create new It becomes easier to products and services that lead better able to provide and satisfaction. to customer happiness

hiring and employee retention, and higher revenues revenues retention, and higher hiring and employee resulting from the contribution to business implementing measures that include overseas group implementing measures that include overseas companies. competitiveness in the hiring market through in the hiring market competitiveness for. to work company becoming a more attractive employees and the organization as a whole, through and the employees work. in one’s a higher sense of fulfillment and pride • As a result of the above, reduced costs relating to As a result of the above, • • A greater sense of unity throughout the group by • • Improved employee retention and increased retention and increased employee Improved • Anticipated benefits from achieving mid- to achieving Anticipated benefits from long-term targets Business impacts of both individual at the level Enhanced vitality, • Mid- to long-term targets Mid- to long-term D&I is shared by all Responsibility for promoting need to get we where Our aim is to show employees. there in an to get must take to and the actions we that all and ensure manner, easy-to-understand of deriving fully understand the meaning employees able to put this into and are vitality from diversity, are implementing measures we practice. In addition, environment and corporate aimed at creating an to culture that encourage all employees company, role in the an active enthusiastically play disabilities, or whether they regardless of gender, childcare, nursing care or other family have responsibilities. Mid- to long-term targets and targets long-term Mid- to performance diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 165 themselves, but who express understanding and are supportive of understanding and are supportive but who express themselves, LGBT people. * ALLY participants are people who may not necessarily be LGBT participants are people who may ALLY * KCMK Group to promote In 2019, the KCMK Group used e-learning (for around a basic understanding of LGBT issues In 2020, there will be a focus on 8,000 employees). for practical application, with preparations underway practical training in dealing with LGBT providing customers for Kanebo and Sofina beauty advisors. LGBT training understanding of LGBT issues, promote employee To in Japan, for all employees conducted e-learning we sessions and lectures, and held periodic training on our multi-function toilets, signage installed relevant training for cosmetics brand provided etc. In 2019, we training with 32 people participating. Since 2015, staff, across Japan, sites of this kind has been held in seven In total of 425 people participating. with a cumulative issues is addition, basic information regarding LGBT so that on the company intranet, made available need to. they it whenever can check employees recruiting, and also continue to conduct ALLY* we In coordination with the measures outlined above, to made declarations 320 employees approximately an who make date (as of December 2019). Employees declaration are issued with special straps which ALLY to wear. are asked they 404-2 number of women employees, in 2019, as in 2018, we as in 2018, we in 2019, employees, number of women Care Vision AEON Group and HOYA cooperated with the for event networking and planned a cross-industry so that managerial level, below just employees women their outlook through dialog participants could broaden large number of other people. A with a and exchange of event, total of 30 people participated in the networking the KCMK Group. from which 5 were of non-Japanese the recruitment Promoting and Research at Kao Corporation’s employees Development Japan, Kao In relation to recruitment of researchers in actively is Research and Development Corporation’s has set a target recruiting non-Japanese researchers, and to be hired. for the number of non-Japanese researchers with diverse among employees collaboration By developing culture backgrounds, the aim is to both foster a corporate to value creation and help employees to new conducive this end, besides recruiting To personal growth. achieve Japanese from among foreign students studying at Germany GmbH with Kao are also working we universities, universities. to recruit directly from overseas and to foster in English that meeting materials are available are making an effort to ensure Some of our workplaces In addition, English communication in the workplace. English-language lunch meetings for colleagues from helping to different countries are organized by volunteers, relationship. the directly work-related build ties beyond

Our initiatives

KCMK Group At the KCMK Group, which has a particularly large female encourage more limited than for men, we is for women available As the number of role models study groups managers to participate in multiple outside action. In in other industries as a part of our positive and public addition to study groups conducted by NPOs within Kao officers service corporations, female executive in plan and implement study groups voluntarily collaboration with officers from other companies. Screening and development regardless of gender regardless and development Screening attributes and other personal adopted the principle of using thorough have We and recruitment that does implementation of evaluation on personal attributes, so as to not discriminate based participation by the of and active foster the appointment to rapidly need. In order kind of human capital that we for both the eliminate the disparities in gender ratios— managers— and the number of number of employees into the D&I issues regarding gender are incorporated those plans are promotion plans for each department, and for selecting set target values carried out. In addition, we of the core human capital according to the composition selecting are steadily implementing and we workforce, attributes. regardless of personal and development officers Human capital meetings conducted by executive women are that engage in discussions while confirming positions. included among the candidates for senior Promoting Participation by Diverse Human Talent Diverse by Participation Promoting diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 166 disabilities. including 48 with Kao Peony, at work 61 employees As of January 2020, a total of Office Support Department Kao Peony Measures implemented at special subsidiaries implemented at Measures employed has actively a special subsidiary, Kao Peony, disabilities, primarily persons with persons with severe since 2005,intellectual disabilities, and the production as volumes the same production division has achieved disabilities. The those on lines operated by persons without Peony established Office Support Department that Kao new the scope of its to expand in 2017 has been working Kao Peony In 2019, business activities and employment. the digitalization tasks, including took on a number of new and support for the internal newsletter of Kao’s & Lifestyle Checkups, etc. Fat implementation of Visceral held in October 2019, one of the employees working at working employees 2019, one of the held in October about how a presentation the logistics center gave motivation. the employees’ there had boosted working attending the Summit were Many of the leaders felt they comments, which impressed by the employee’s understanding of diversity. had deepened their 405-1 provides for disabled employees before they join the join the before they disabled employees for provides by confirming in advance what support and company, for help to reduce worry we will need, each employee join the company. they after these employees to all employees for other events and subsidiary, of disabilities. In 2019, diversity increase understanding and parasports the Paralympics seminars focused on and Ehime— —Kayabacho locations held at two were with a total of 116 participants. • We periodically hold seminars, tours of our special periodically hold seminars, We • KCMK Group employees training for new KCMK Group provided The employees training aimed to get new with disabilities. The others to communicate with thinking about how needed. It they regarding their disability and the support this through opportunities for practicing also provided also Trainees activities with senior employees. role-playing function needed to acquired the mindset that was by learning adult, for example properly as a working methods, sales techniques and communication effective etc. to build relationships with customers, how Kao (Australia) has formed a partnership with Wallara Kao (Australia) Ltd., a social enterprise which helps people with Australia In 2019, disabilities to participate more fully in society. of companies collaborated on the establishment the two employs logistics center in Melbourne, which a new people with disabilities. Around 30% of Wallara at this logistics center. working are now employees that was At the Leadership Summit of Kao (Australia)

information about the support that the company support communication with employees who have who have support communication with employees hearing impairments. and a Fact Sheet for Understanding Disabilities and and a Fact mutual distributed them on the intranet to promote and with disabilities understanding among employees their colleagues. with Disabilities to worksites nationwide to conduct nationwide with Disabilities to worksites hold We with disabilities. consultations for employees once with Disabilities Support Meeting an Employees their skills to help the consultants upgrade each year for persons support system and strengthen the overall with disabilities. with disabilities, asking about the current status of their with disabilities, asking experiencing be may disability and any problems they where necessary given, Based on the answers at work. and provide Kao personnel coordinate with relevant we problems. the employees’ support to help resolve • For prospective employees with disabilities, we provide provide with disabilities, we employees prospective For • • We introduced UD Talk voice-recognition software to software voice-recognition UD Talk introduced We • • We prepared a Disabled Person Employment Manual Employment a Disabled Person prepared We • • We also assign Vocational Life Consultants for Persons Life Consultants for Persons assign Vocational also We • • Every year, we administer a questionnaire to employees to employees administer a questionnaire we year, Every • Promoting normalization Promoting We position support for people with disabilities as an with disabilities as support for people position We a formulated D&I efforts, and have important part of our for a society where people with basic policy of “Striving create we together, and live work and without disabilities with disabilities for employees environments workplace a sense of pride life easier for them and foster that make work.” in one’s Promoting better understanding of disability and promoting the employment of persons with disabilities with persons of the employment and promoting of disability better understanding Promoting diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 167 Kao Corporation’s 50+ Career Seminar Kao Corporation’s perspectives. These seminars are implemented in implemented in seminars are These perspectives. at career consultation interview conjunction with a the support that older the age of 55, to provide their mindset and need in order to change employees for the future, and so that they to be ready behavior will need of the things they in advance will be aware Kao will need to make. they to learn and preparations and Kanebo Co., Ltd. Group Customer Marketing implement seminars and Cosmetics Inc. also are aiming to roll out these and we interviews, the group. activities throughout the range of will continue to expand In the future, we and we to older employees, styles available working the range of to expand will be working opportunities—both within and outside the to utilize the company—for senior employees have they that and specialist expertise experience make and accumulated at Kao to remain active contribution. positive 404-2, 405-1404-2, Expanding the scope for active participation by participation by active Expanding the scope for senior human capital open Since 2016, Kao Corporation has held are We recruitment for people aged 55 or over. talent with implementing careful matching of human for senior the opportunities positions, expanding expertise specialist citizens to use their experience, positions and other strengths to include not only at NPOs or within our company but also positions etc. NGOs and at intermediary support organizations, our intranet, set up a dedicated page on In 2018, we information and which is used to disseminate relevant individual career consultations. provide development career self-directed Support for (with Kao Corporation organizes three seminars aged 45, 50 participation) for employees voluntary of getting with the aim and 55 respectively, of lifestyle, and kind about “What to think employees in the to have style, do I want what kind of working future?” from both life planning and financial planning Fostering active participation by senior human capital senior human by participation active Fostering to people can expect which more and more In an era in to build an been working to 100, Japan has live that encourages people to environment employment laws through the amendment of relevant longer, work creating a society in which diverse etc., with the aim of As part of the for longer. active human talent can remain systems, the Kao Group in adjustment of our personnel the employment to expand Japan has been working implementing measures that system for senior citizens, areas. key two are focused on the following * (Year) 2.42 2.37 As of June 1, 2019. 2.29 2.27 Kao Group in Japan 2.28 2.08 2.21 2.10 ield Marketing Co., Ltd., Kao Professional Services ield Marketing 2.21 2.12 2015 2016 2017 2018 2019 Kao Corporation

(%) Co., Ltd., Kao Sanitary Products Ehime Co., Ltd., Kao Logistics Co., Co., Ltd., Kao Sanitary Products Ehime Co., Ltd., Inc., Ltd., Kao Business Associe Co., Ltd., Kanebo Cosmetics special Co., Ltd. and Odawara Kao Cosmetic Products e’quipe, LTD., Co., Ltd.). subsidiary Kao Peony Thirteen domestic affiliates that are required to employ people with domestic affiliates that are required to employ Thirteen Co., Marketing disabilities (Kao Corporation, Kao Group Customer Beauty Counseling Ltd., Sofina Beauty Counseling Co., Ltd., Kanebo Co., Ltd., Kao F 1.80 2.00 2.40 2.20 2.60 * Scope: Kao Group employment rate of persons with disabilities with of persons rate employment Kao Group Employment rate of persons with disabilities with disabilities of persons rate Employment (Japan) for 2.42% disabilities account persons with Currently, Kao Group in Japan, of the workforce of the total minimum rate of 2.2% (As of the statutory exceeding June 2019). diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 168 further strengthening our document server usage our document server further strengthening measures. environment and security time vacation to take employees Encouraging continued to implement have Since 2018, we targets: the following activities aimed at achieving rate for vacation time usage 80% or higher average minimum the Kao Group in Japan; 50% or higher individual Each usage rate for individual employees. the raise to efforts its continuing is office and worksite by designating vacation time usage rate, for example Usage Promotion Time as Vacation particular days systems. Leave and organizing Anniversary Days change in the law In addition, in April 2019 a annual made it obligatory for companies to arrange are paid vacation periods. In response, we of planned days five to take encouraging employees who annual basis, with employees on an paid leave receiving individual reminders leave such do not take to do so. 103-2 Proactive utilization of ICT tools, starting with utilization of ICT tools, starting Proactive Enterprise Information Kao Corporation’s Solutions Solutions, for meetings At our Enterprise Information needs to be shared with every where the content workplace member of the division, Microsoft Teams and recording the for relaying is used chat software part in the can take employees meetings. In this way, business trips, on meeting from home or while away are unable to participate at all who and employees date. This the recording content at a later can view of the topics system also facilitates thorough sharing reduces to be addressed at each meeting in advance, and allows the amount of time needed for meetings, part in only that part of the to take employees aim we way, to them. In this meeting that is relevant their time more to use to enable individual employees is being The scope of this initiative efficiently. content on our through sharing of meeting expanded also company intranet, etc., with other departments and use of video-conferencing being able to make chat functions. workplace our information to improve are also working We environment and communications technology (ICT) can connect to each other and so that employees are, by they utilize information systems wherever work styles (Kao Corporation) work p. 172 Main systems for supporting diversified supporting diversified p. 172 Main systems for ➡

Starting from this year, staff at several worksites, worksites, staff at several Starting from this year, will be head office, including our Kayabacho all year casual business clothing permitted to wear to create an atmosphere in which strive round, as we that feels natural to them. in a way people can work Systems to realize diversified work styles work diversified Systems to realize measures to Kao Group in Japan is implementing The options and time and location increase work-related systems that we styles. The work in facilitate diversity system (with no a flextime adopted include have required core hours) and a working-from-home system. With the aim of making it possible for diverse employees to maximize their potential in different workplaces, we are undertaking efforts to develop environments and environments efforts to develop are undertaking we different workplaces, their potential in to maximize employees for diverse of making it possible the aim With work styles. and facilitate more flexible workplaces that will improve personnel systems are disseminating we current personnel systems, and full use of the can make culture where employees that it is important to cultivate a corporate believe We to that end. training and various other programs information and conducting Realization of diversified work styles work of diversified Realization diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 169 Awarding of “Yamagata Child Care and Nursing and Nursing Child Care of “Yamagata Awarding Companies” certification from Lively Support Care Government Prefectural Yamagata Sakata Plant and the In 2019, both Kao Corporation’s Tohoku Branch of Kao Group Office of the Yamagata awarded Co., Ltd. (KCMK) were Customer Marketing Yamagata Child Care and certification as a Diamond level This Companies certification. Nursing Care Support Lively enterprises, to those business awarded certification is to foster implemented measures among firms that have advancement and support the maintenance of women’s child care and balance (particularly in relation to work-life by nursing care) that meet certain criteria specified there are three While Prefectural Government. Yamagata of certification, depending levels on the measures implemented, both of the recipient companies Diamond awarded were certification, the highest level, on this occasion. External evaluation of childcare support measures of childcare evaluation External and certification Kurumin of Platinum Awarding certification Kurumin Platinum Kurumin awarded was In 2016, Kao Corporation workplace for employees a supportive certification for creating of the Act for with the provisions with children, in accordance Generation. the Next of Development Measures to Support the and Kao Group Kanebo Cosmetics Inc. Ltd. (KCMK) Co., Customer Marketing certification in Kurumin awarded were In 2019, Kao 2009 and 2011 respectively. also & Logistics Co., Ltd. was Transport certification. Kurumin awarded 404-2 Kao Corporation Seminars for Employees Returning from Childcare Kao Corporation Seminars for Employees Seminars) in 2019 (Tatsuno-oshigoto Leave Meetings & Mothers) F&M (Fathers in Japan hold Kao Corporation and other group companies employees aimed at bringing together a variety of events in providing or plan to be, engaged who are currently, and can share information childcare, so that they to the best ways communicate with one another regarding & F&M (Fathers balance. With a proper work-life achieve can Mothers) Lunch Meetings at which employees Senior about various pre-set topics, views exchange direct Seminars at which employees’ Mentoring Employee balancing work of experience superiors discuss their own by given and childcare responsibilities, and seminars on an are holding these activities we experts, external different formats. ongoing basis with different targets and in steady increase in there has been a years, the past few Over taking part in these events, the number of male employees by participants has expressed of satisfaction and the level able to listen to were risen, with comments such as “We mothers and fathers.” by working frank opinions expressed to work. We also encouraged supervisors to participate encouraged supervisors also We to work. encouraging male in the seminars. In 2020, besides actively also intend to we and supervisors to participate, employees throughout all branches in Japan. roll out these seminars

In the KCMK Group, these seminars place particular emphasis In the KCMK Group, these seminars place particular from the include a message on raising motivation, and they who already as talks by female employees president as well childcare after taking of returning to work experience have who employees and by managers who are supervising leave In 2019, the after childcare leave. returned to work have with the aim of fostering held on weekdays, seminars were greater understanding among both supervisors and partners back into the mindset of returning and of getting employees partners. In accompanied by their these seminars were attending of the employees In 2019, more than 80% to participation an environment conducive order to provide facilities that arrange childcare partners, we by employees’ will continue with We can be used during the seminar. support so to provide in the future, working these initiatives work-life can realize an appropriate that more employees balance together with their family members. Employees of Kanebo Cosmetics Inc. and other group of Kanebo Cosmetics Inc. and Employees head the seminars held at our Kayabacho companies can attend Japan so throughout office, and these seminars are also relayed them. can benefit from at all worksites that employees cooperative participate in the training with the aim of building partners to Kao Corporation is also encouraging employee’s development. relationships with partners in home life and career Seminars for employees returning from childcare childcare from returning employees for Seminars Seminars) (Tatsuno-oshigoto leave who are for employees conduct seminars we Each year, (Tatsuno- from childcare leave about to return to work Kao group companies in Japan. The oshigoto Seminars) at image of life after returning to seminars present a concrete attitudes and raise prepare their and help employees work reinstatement. regarding their awareness Support for balancing work and childcare or family care responsibilities care family or childcare and work balancing for Support diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 170 next-generation through providing education in providing through next-generation and educational materials the classroom Corporate citizenship activities: Education for the Education for Corporate citizenship activities: ➡ www.kao.com/content/dam/sites/kao/www-kao- com/global/en/sustainability/pdf/sus-db-2020-e-all. pdf#page=77 Association of Technology Executives (JAOTEX) on (JAOTEX) Executives Association of Technology for promoting taken have the measures that we advancement in the workplace. women’s of Health, of the Ministry posted on the website (MHLW). Labour and Welfare family care Productivity Center and reported on our support measures. special needs schools. special needs collaborated have ESG Promotion” & Management, on our special subsidiary, Co., Ltd., Peony with Kao classes for children and holding hand washing disabilities, with Kao students with intellectual support for class providing employees Peony implementation. We have given corporate case study presentations for corporate case study given have We with agencies and other organizations, government of D&I the aim of contributing to the promotion throughout society. a case study presentation at the Japan Gave • Our case study for family care support measures is • Appeared at a lecture held by the Shikoku • • The division of Kao Corporation “Business Planning Kao Corporation “Business division of The • CEO Michitaka Sawada & CEO Michitaka Sawada & CEO Michitaka Sawada 102-12, 102-43, 404-2 102-43, 102-12, understanding of disability and promoting the the of disability and promoting understanding disabilities with of persons employment ➡ better Promoting p. 166 Our initiatives: ➡ design product p. 50 Universal been providing support to help people with support been providing including disabilities secure employment, visits and arranging workplace proactively training opportunities for students from workplace has signed a declaration confirming Kao’s support confirming Kao’s has signed a declaration campaign to raise the share of for the 30% Club, a companies to at officers at major female executive Action by a least 30%, and for the Declaration on a Society in Create Group of Male Leaders who Will organized by the an initiative Shine, Women Which Office. Gender Equality Bureau of the Cabinet declaration of support for the approach signed Kao’s 500, an international Valuable of The and initiatives a playing established to get companies initiative in which leading role in building an environment in actively people with disabilities can participate in general, etc. and the economy business, society, • Kao Peony Co., Ltd., our special subsidiary, has Co., Ltd., our special subsidiary, Kao Peony • Collaboration with stakeholders with Collaboration Empowerment signed the Women’s In 2010, we international guidelines for Principles, which are UN participation in society based on women’s and the UN Global Compact. Women in 2019 presentations Main case study • Kao Corporation President • Kao Corporation President

allowances and services allowances resources personnel support the life-work balance targeting male employees support the life-work reports supervisors using childcare leave and their workplace Seminars) (Tatsuno-oshigoto leave who are working meetings and seminars, etc. for employees mothers and fathers) Management”) General work-life balance measures work-life General systems Individual guidance before using leave • full use of relevant to make Encouraging employees • and Life Balance Guidebook of the Work Provision • Main support for balancing work and family and family balancing work Main support for responsibilities care Holding family care seminars • of family care handbooks Provision • consultation skills by human Reinforcement of family care • service family care consultation Establishment of an external • • Distributing a leaflet with information on systems that Distributing a leaflet with information • interviews leave Conducting pre- and post-childcare • on leave employees between Encouraging communication • returning from childcare Holding seminars for employees • care facility (Merries Garden) of an on-site day Provision • & Mother) Meetings (discussion Holding of F&M (Father • and Life Balance e-learning for managers (“Work • Main support for balancing work and childcare and childcare balancing work Main support for responsibilities

Family care support measures support care Family policies of enabling each with our fundamental In accordance on a assistance based act independently and providing individual to measures to educate are taking support, we spirit of mutual in the workplace and to promote mutual understanding employees the cause of work from leaving employees with the aim of preventing held on topics 2019, internal seminars were family care obligations. In care for persons suffering from dementia, of including the provision the also undertake participating. We etc., with a total of 225 people family care including introduction of of information— provision services where appropriate. consultation handbooks—and provided diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 171 Awards ceremony Awards female workers are motivated and how they are treated they how are motivated and female workers are compiled based on rankings and/or appointed. The to managerial positions, four indicators: promotion balance, and work-life ability, use of women’s active promotion. workstyle diverse for the Prime Minister’s Award Kao received from Shine Women Where Leading Companies of Japan the Cabinet Office Prime the 2019 received In December 2019, Kao Women Companies Where for Leading Award Minister’s a Shine, in recognition of our efforts in building to women’s environment conducive workplace of information advancement and in relation to disclosure regarding related measures and performance. to specific issues and implementation of measures for its analysis of organization- praised Kao was it encouraged employees’ address these issues, the way returning partners to attend seminars for employees approach to and its proactive from childcare leave, publicizing these measures outside the company. Kao was selected by the Ministry of Economy, Trade Trade Ministry of Economy, the selected by Kao was Brand as a Semi-Nadeshiko and Industry (METI) for the Semi- selected was In March 2019, Kao made Brand list as a company that has Nadeshiko women’s in advancing outstanding achievements Brands Semi-Nadeshiko participation in the workplace. almost up to performance was are companies whose Brand standard. A total of 22 companies, Nadeshiko for inclusion in the list. selected from all industries, were and evaluations recognized for undertaking Kao was regardless and ability, based on enthusiasm employment that facilitate systems and for developing of gender, styles. work diverse list of the 100 Woman’s in Nikkei first Kao ranked Part Take Actively Women Best Companies Where ranked announced that Kao was 2019, it was In May 100 (out of 538 companies) in the list of the overall first Take an Actively Play Women Best Companies Where magazine and the Woman compiled by Nikkei Part first in the Project. Kao also ranked Womenomics Nikkei rankings are Promotion section. The Workstyle Diversity participation of the state of women’s based on a survey of how perspectives in each company from the two External Evaluation External

Topic In January 2019, Kao was selected for inclusion in the was In January 2019, Kao GEI (GEI). The Index Bloomberg Gender-Equality that are committed to transparency identifies companies to advancing equality for in gender reporting and a total of 230 In 2019, in the workplace. women for inclusion in the GEI, of selected companies were Japanese companies. which 14 were Kao was selected for inclusion in the 2019 selected for Kao was Index Gender-Equality Bloomberg

diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 172 Content In common Special leave is available for employees who incurred a for employees is available Special leave 40 personal injury or sickness (up to a maximum of either for this is available In principle, a year). or 20 days a year days of at least 8 days. periods of leave who participate in for employees is available Special leave by the company (up to a activities approved volunteering a year). maximum of 5 days or in increments of either one day can be taken leave This half a day. completed 10, who have is granted to employees leave This of service with the company (up to a 20, 30 or 40 years a year). maximum of 5 days Where an employee’s spouse is be on an overseas spouse is be on an overseas an employee’s Where wishes to accompany the assignment and the employee and no more of at least one year spouse, a period of leave can be taken. years than two Annual paid leave can be taken in hourly increments up to a can be taken Annual paid leave period, within any one-year day-equivalents maximum of five regardless of the reason. With the exception of some shift workers, the working-from- of some shift workers, the exception With to all employees. home system is applicable the need to from home include Grounds for applying to work provide family care or nursing care, the need to provide to age of completion of the third childcare (for children up medical the need to receive grade in elementary school), or operational requirements. treatment for injury or illness, can be performed in the employee’s Working-from-home the residence, in the home of the person for whom own family care or nursing care, or in the is providing employee from their family. posted away residence of an employee can be utilized up to twice per week, Working-from-home at home for an can choose either to work and employees or for only part of the day. entire day With the exception of some shift workers, flextime is applied flextime shift workers, of some exception the With of grounds. regardless to all employees, times for the start core time period. The is no required There range of are set within a flextime and end of work of work 07:00–20:00. been set at one-month units. Settlement periods have Main systems Special leave for Special leave personal injury or sickness for Special leave volunteering activities Refreshment leave Family leave for leave Family overseas assignments Ability to take Ability to take annual paid leave in hourly increments Working-from- home system Flextime system Flextime 401-3 Nursing care and family care related care and family care Nursing Special leave is available for employees who need to fulfill for employees is available Special leave a nursing care or family care responsibilities (up to a year). or 20 days a year maximum of either 40 days in increments of either one day, can be taken leave This or one hour. half a day, Employees who have family members requiring nursing who have Employees weeks care or family care for a period of more than two to perform work can request either limits or exemption or work on holidays, hours, work outside normal working late at night either. Along with reduced working hours and staggered working hours and staggered working Along with reduced working to hours, this system can be utilized for a period of up in up this benefit can be taken Alternatively, three years. period. blocks of time within the three-year to two a or work a week, three days can either work Employees week. a days five half day Along with flexible working hours, this system can be working hours, this system Along with flexible this Alternatively, to three years. utilized for a period of up blocks of time within the in up to two benefit can be taken period. three-year by up to working hours can be reduced Either specified work time for starting or the specified hours per day, two work can be adjusted. or finishing Nursing care and family care leave can be taken for a can be taken and family care leave Nursing care year. maximum period of one nursing care and family care During the period in which in a maximum can be taken leave is permitted, such leave of three blocks of time. Content Childcare related Childcare Special leave is available for employees who need to fulfill for employees is available Special leave a nursing care or family care responsibilities (up to a year). or 20 days a year maximum of either 40 days Up until the first April 30 following the child’s enrollment the child’s Up until the first April 30 following can the employee in elementary school as a first grader, outside to perform work request either limits or exemption late at or work on holidays, hours, work normal working night. In principle, this can be implemented, on the request of In principle, this can be implemented, on the request the child’s until the first April 30 following the company, first birthday. a or work a week, three days can either work Employees week. a days five half day These are available until the child completes the third the third until the child completes are available These grade of elementary school. by up to working hours can be reduced Either specified time for starting or the specified hours per day, two work can be adjusted. or finishing work In principle, childcare leave can be taken until the first until can be taken In principle, childcare leave birthday. first the child’s April 30 following days after the first five for the is provided leave Paid leave. commencement of childcare

Main systems Special leave for Special leave nursing care and family care Restriction on working extra hours Flexible working working Flexible hours Reduced working Reduced working hours and staggered hours working Leave Main systems for supporting diversified work styles (Kao Corporation) work styles supporting diversified for Main systems diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 173 4 5 6 10 10 11 11 14 16 16 94 86 73 92 110 6.53.1 6.7 4.1 7.7 4.5 8.0 6.0 8.0 5.7 335 573 648 847 1,006 125 104 93 109 129 54.8 50.627.5 51.310.4 25.4 51.4 13.1 25.1 51.1 14.6 27.3 18.4 29.4 21.2 52.5 49.2 49.4 49.8 49.6 75.2 82.3 78.5 84.4 85.3 1,301 1,700 1,618 1,799 1,991 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 17,340 16,33212,120 16,590 11,130 16,748 11,399 16,657 11,464 11,292 No. of employees (persons) No. of employees (%) Percentage (persons) No. of employees (%) Percentage (persons) No. of employees (%) Percentage (persons) No. of employees (%) Percentage (persons) No. of employees (%) Percentage (persons) No. of employees Percentage (%) Percentage Japan Japan Global Japan Global Global Of which, Number of employees re-employed re-employed Of which, Number of employees after retirement Percentage reemployment after retirement reemployment Female managers Female Female executive officers executive Female Female employees Female Number of employees who reached retirement retirement who reached Number of employees age* * Company officers include executive officers. executive * Company officers include * Number of employees who reached retirement age = Number of retired employees + Number of who reached retirement age = Number of retired employees Number of employees * Number of persons re-employed after retirement (Kao Corporation) retirement after re-employed Number of persons Status of female employees in the Kao Group employees female Status of 102-8, 401-1, 405-1 401-1, 102-8, 3 2 3 3 3 69 69 73 90 88 90 336 381 432 479 0.7 0.5 0.6 0.7 0.9 8.78.8 14.0 15.5 8.8 16.8 8.6 18.2 5.7 8.3 264195 283 214 269 196 304 214 306 218 22.3 22.6 23.241.742.6 23.838.6 41.218.5 42.019.8 24.4 38.5 41.0 14.1 18.3 41.7 19.4 38.6 41.8 14.5 17.4 42.6 18.4 39.4 40.6 13.9 17.8 41.2 19.2 38.8 13.5 17.7 18.7 14.6 6,9705,414 7,1951,556 5,568 7,332 1,627 5,631 7,655 1,701 5,831 7,905 1,824 5,979 1,926 2015 2016 2017 2018 2019 45.6 48.4 49.6 51.1 7,170 3,900 3,270 4,332 2,237 2,095 33,603 16,946 16,657 22,101 10,809 11,292 2019 (excluding Japan) (excluding

Male (persons) (persons) Female Male (persons) (persons) Female Male (persons) (persons) Female Male (persons) (persons) Female Male Female Male Female Male Female Male Female Female employees as percentage of total (%) as percentage employees Female Female employees as percentage of total (%) as percentage employees Female Female employees as percentage of total (%) as percentage employees Female Female employees as percentage of total (%) as percentage employees Female Total (persons) Total Europe and the Americas Europe Japan Asia and Oceania Number of recent graduates hired (persons) hired graduates Number of recent (%) turnover Employee Average length of employment (years) length of employment Average Average age (years) Average Female manager ratio as percentage of total (%) as percentage manager ratio Female (persons) managers Female of total (%) ratio as percentage officers executive Female (persons) officers executive Female Female employee ratio as percentage of total (%) of total as percentage ratio employee Female Regular employees (persons) Regular employees * Company officers include executive officers. executive * Company officers include Status of regular employees (Kao Corporation) (Kao employees Status of regular Number of Kao Group employees in 2019 (regular employees) (regular in 2019 employees Kao Group Number of diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020 Making my everyday Making thoughtful Making the world Kirei Lifestyle Plan Walking the right path more beautiful choices for society healthier & cleaner

Contents Editorial Policy CEO Message Kirei Lifestyle Plan KPI definitions Independent assurance report 174 401-3 (%) (Days) (Days) Unit (Hours) (Hours) (Persons) (Persons) (Persons) (Persons) (Persons) (Persons) (Persons) (Persons) (Persons) (Persons) (Persons) (Persons) 308 584 6 87 8 9 30 22 21 2 0 0 1 2 0 0 0 0 0 0 ― 85 102 122 9011 113 12 84 1 0.9 1.9 1.0 101 124 115 19.513.7 18.772.8 15.11.73 17.7 78.8 14.4 3.30 74.6 2.98 2017 2018 2019 Employment system Employment

Total number of employees taking special leave taking special leave number of employees Total activities for volunteering utilizing the working-from- No. of employees home system No. of employees taking family leave for overseas for overseas taking family leave No. of employees assignments (female) for of special leave number of days Average activities taken volunteering No. of employees taking reduced working hours taking reduced working No. of employees hours to meet nursing care or staggered working or family care responsibilities (female) for overseas taking family leave No. of employees assignments (male) No. of employees taking nursing care or family No. of employees (female) care leave hours taking reduced working No. of employees hours to meet nursing care or staggered working or family care responsibilities (male) No. of employees taking nursing care or family taking No. of employees (male) care leave No. of employees taking reduced working hours hours reduced working taking No. of employees hours to meet childcare or staggered working responsibilities (male) hours reduced working taking No. of employees hours to meet childcare or staggered working responsibilities (female) Average hours of leave taken in hourly taken hours of leave Average increments (male) childcare leave taking No. of employees (female) childcare leave taking No. of employees Average days of paid leave taken leave of paid days Average utilization rate paid leave Average Average hours worked outside regular working regular working outside hours worked Average hours (per month) Employment system utilization status (Kao Corporation) system utilization Employment diverse workplaces workplaces & diverse Inclusive Kao Kirei Lifestyle Plan Progress Report 2020