Disclosure of Information Based on TCFD and TNFD Recommendations

DNP regards addressing environmental issues as one of its key management challenges. To enhance environmental, social and economic sustainability and further drive sustainable corporate growth, the Sustainability Committee manages medium- to long-term risks, identifies business opportunities and incorporates them into management strategies. By coordinating with the BCM Promotion Committee, which ensures business continuity in the event of a natural disaster or other emergency, and the Corporate Ethics Committee, which aims to raise employeesʼ compliance awareness and reduce risks, the Sustainability Committee has established a more flexible and robust governance system that covers company-wide risks.

The Sustainability Committee convenes at least four times annually, reporting and making recommendations to the Board of Directors. The Board of Directors reviews and supervises policies, action plans and other measures related to sustainability risks and opportunities, based on the Committeeʼs reports and resolutions. Strategies and policies on environmental issues determined by the Committee are implemented by the DNP Group as a whole, in coordination with the Business Unit & Group Company Environmental Committees.

In its business activities, DNP relies on a wide range of ecosystem services and impacts natural systems. We have organized these dependencies and impacts within the context of DNP and Nature, identifying where in the value chain they occur and how they affect the natural environment.

DNP depends on ecosystem provisioning services for the raw and auxiliary materials used in its businesses. For example, DNP is dependent on forest resources for paper for magazines and books, and lithium-ion battery pouches and optical films use mineral and fossil resources. We also rely on water resources, both directly in manufacturing processes and indirectly in papermaking. In addition, production sites located near rivers depend on ecosystem regulation and maintenance services. Four of DNPʼs manufacturing sites* near rivers are located in high water-risk areas and have been identified as priorities. Our manufacturing processes also emit gases into the atmosphere (GHGs, NOx, SOx, VOCs, etc.), discharge waste into bodies of water (wastewater, nitrogen, phosphorus, etc.) and unnecessary objects including plastics, all of which are regarded as causes that negatively impact the environment.

• *Four manufacturing sites in high water-risk areas
  Vietnam ([10]DNP Vietnam Co., Ltd.), Malaysia ([7]DNP Imagingcomm Asia Sdn. Bhd.), Indonesia ([8]PT DNP Indonesia- Jakarta), [9]PT DNP Indonesia- Karawang). For details on the business activities at each location, see the list of sites subject to disclosure in “Environmental Report 2025, p. 40.”

• Indicators independently verified by a third party are marked with a checkmark.

To identify environmental risks and formulate strategies and countermeasures, DNP conducted scenario analyses. These analyses enabled us to identify specific potential impacts on our business, which we categorized as environmental risks and opportunities. Considering our business plans, we evaluate the impact of these risks and opportunities on stakeholders and our business operations in terms of the level of effects (high: approximately 10 billion yen, medium: 1 billion yen or more, low: less than 1 billion yen), period of effects (short-term: 5 to 10 years, medium-term: 5 to 15 years, long-term: 15 years or longer), and likelihood of occurrence (high: high likelihood of occurrence, medium: moderate likelihood of occurrence, low: low likelihood of occurrence).

This section outlines the relationship between DNP’s environmental risks and opportunities and the results of scenario analysis, taking into account the ecosystem services^*1and impact factors^*2on which DNP’s business activities depend.

We recognize that the increasingly frequent and severe damage due to torrential rains, forest fires and other natural disasters and the degradation of ecosystem provisioning services may cause the suspension of operations or the realization of supply chain risks. We conduct region-level assessments of the water risks faced by our domestic and overseas manufacturing sites using published tools such as Aqueduct provided by the World Resources Institute (WRI) to identify priority regions.

To respond to these risks, we are investing in disaster preparedness infrastructure, such as emergency power systems and water control barriers. We have also been working to further enhance our supply chain management by building production systems at multiple plants and diversifying suppliers.

• [Time horizon] Short term: 0-5 years, medium term: 5-15 years, long term: 15 years or more [Level of effects]: High: approx. 10 billion yen, Medium: 1 to 10 billion yen, Low: less than 1 billion yen [Likelihood] Probability of impact: High > medium > low
  The scenarios used to identify risks and opportunities, as well as dependencies and impacts on natural capital that were considered are indicated with a ● mark.

As policies addressing environmental challenges become stricter, it is expected that new measures will become necessary, including mandatory environmental due diligence and the regulation of plastics, in addition to decarbonization-related regulations. This shift will increase stakeholdersʼ awareness of the environment, and companies that fail to respond adequately risk exiting the market or suffering reputational damage.

To address transition risks, DNP is transforming its business portfolio to reduce its negative environmental impacts and increase added value. In addition, DNP is focusing on managing environmental risks using self-imposed criteria that are stricter than laws and regulations, promoting the recycling of plastics with a low recycling rate and strengthening its supplier engagement based on the DNP Group Sustainable Procurement Guidelines.

• [Time horizon] Short term: 0-5 years, medium term: 5-15 years, long term: 15 years or more [Level of effects]: High: approx. 10 billion yen, Medium: 1 to 10 billion yen, Low: less than 1 billion yen [Likelihood] Probability of impact: High > medium > low
  The scenarios used to identify risks and opportunities, as well as dependencies and impacts on natural capital that were considered are indicated with a ● mark.

DNP believes that society and the economy are increasingly oriented toward integrated actions to realize nature positivity, and this will increase the demand for eco-friendly products and services. This is a significant business opportunity for the Company.

 Guided by its Medium-term Management Plan, DNP is planning to invest 260 billion yen over the five years through fiscal 2027, focusing on priority business areas including eco-friendly products and services, such as battery pouches for lithium-ion batteries. Our goal is to positively impact the natural environment while creating a virtuous cycle of new earnings growth and enhanced corporate value.

• [Time horizon] Short term: 0-5 years, medium term: 5-15 years, long term: 15 years or more [Level of effects]: High: approx. 10 billion yen, Medium: 1 to 10 billion yen, Low: less than 1 billion yen [Likelihood] Probability of impact: High > medium > low
  The scenarios used to identify risks and opportunities, as well as dependencies and impacts on natural capital that were considered are indicated with a ● mark.

To achieve the DNP Group Environmental Vision 2050, we have established medium-term targets and are actively implementing initiatives to meet them. These initiatives are making steady and good progress, and we will continue to accelerate efforts to protect the environment and reduce our environmental impact.