Sumitomo Bakelite Co., Ltd. (hereinafter "SB") have established the following systems to ensure that our business activities will be conducted appropriately, based on SB's "Business Philosophy" which states "Our philosophy is to value the trust and maintain the steadiness. Based on this, we strive through our business activities to make contributions to social progress and improvements to quality of life worldwide."

Article 1.
Systems for ensuring that the performance of duties by directors and employees complies with laws and regulations as well as the Articles of Incorporation of Sumitomo Bakelite Co., Ltd

1. Sumitomo Bakelite Co., Ltd has established a "Standard of Conduct" in line with SB's "Business Philosophy", as SB's "Rules and Regulations for Compliance" states. The directors, executive officers and employees of SB will comply with laws and regulations, the Articles of Incorporation of SB and other applicable rules and will not deviate from corporate ethics.
   
   
2. The "Compliance Committee" of Sumitomo Bakelite Co., Ltd shall investigate the status of company-wide compliance, improve the situation related to compliance, and provide educational programs on compliance. SB's President appoints one of the SB's directors to be the chairperson of the "Compliance Committee" of SB.
   
   
3. Two Information addressees (The Internal Audit Dept. manager of Sumitomo Bakelite Co., Ltd / A corporation lawyer of Sumitomo Bakelite Co., Ltd) shall be established in accordance with the "Compliance Reporting System (Ethic hotline)" of Sumitomo Bakelite Group. Information collected through the information addressees shall be reported to SB's President so that SB's President takes appropriate actions.
   
   
4. Sumitomo Bakelite Co., Ltd shall enhance a system for ensuring reliability of financial reporting of Sumitomo Bakelite Group, based on SB's "Basic Rules and Regulations for Internal Control Over Financial Reporting". SB shall implement internal control appropriately thorough assessment, reporting and remediation. In addition, SB shall disclose corporate information in a timely and appropriate manner.
   
   
5. "Internal audit divisions" of Sumitomo Bakelite Co., Ltd shall investigate and assess a system for managing and operating the overall business activities and the status of business operations in terms of legitimacy and compliance with relevant standards and shall provide appropriate advice and suggestions for improvement. The above "internal audit divisions" consist of the Internal Audit Dept of SB (under the direct control of SB's President) and particular departments (carry out an audit regarding particular supervisory activity, such as quality, environment and so on).
   
   
   

Article 2.
Systems relating to the retention and management of information on the performance of duties by directors

1. Sumitomo Bakelite adopt "Rules and Regulations for Requesting for Managerial Decision" as a collective decision-making process (=Japanese ringi system) in making a decision on the performance of duties by directors, executive officers and employees. In addition, the collective decision-making process mentioned above shall be recorded and maintained on either paper documents or electronic media.
   
   
2. Information on the performance of duties by directors, executive officers and employees shall be appropriately retained and managed in accordance with laws and regulations, and Sumitomo Bakelite's company regulations and relevant procedures including SB's "Rules and Regulations for Document", SB's "Rules and Regulations for Document Retention", SB's "Rules and Regulations for Confidential Information Control", SB's "Basic Rules and Regulations for Personal Information Protection" and SB's "Information System Security Basic Policy Regulations".
   
   
3. "Internal audit divisions" of Sumitomo Bakelite Co., Ltd shall audit the status of retention and management of information on the performance of duties in light of applicable laws and regulations, SB's company regulations and operational procedures. The internal audit divisions of SB shall provide advice and suggestions for retaining and managing such information appropriately.
   
   
   

Article 3.
Systems for rules and regulations concerning the management of the risk of loss

1. Sumitomo Bakelite Co., Ltd shall establish basic policies on risk management for Sumitomo Bakelite Co., Ltd and its group companies in SB's "Basic Rules and Regulations for Risk Management" to appropriately monitor and manage various risks entailed in doing business.
   
   
2. The "Risk Management Committee" of Sumitomo Bakelite Co., Ltd is set up for discussing the issues that is found in furthering　company-level risk　management and adopting their countermeasure.
   The "Risk Management Committee" shall assign a department in charge for taking specific measures for each individual risk. The assigned department in charge shall report to the "Risk Management Committee" on the progress of taking such measures.
   
   
3. Sumitomo Bakelite Co., Ltd shall adopt "Rules and Regulations for Crisis Management" as policies, structures and communication routes in crisis in order to quickly resolve such risks and mitigate the damages resulting from risks.
   
   
4. "Internal audit divisions" of Sumitomo Bakelite Co., Ltd shall investigate and assess a system for managing and operating the overall business activities and the status of business operations and provide advice and suggestions for safeguarding the company's assets.
   
   
   

Article 4.
Systems for ensuring the efficient performance of duties by directors

1. The Board of Directors of Sumitomo Bakelite Co., Ltd. shall determine the important business operations based on laws and regulations and SB's "Rules and Regulations for the Board of Directors", receive reports on significant issues regarding the performance of duties by directors and supervise the progress of the performance of duties.
   
   
2. The Board of Directors of Sumitomo Bakelite Co., Ltd shall elect SB's executive officers. SB's Executive officers shall perform their duties as persons responsible for the performance of duties under the direction and supervision of SB's President
   
   
3. The monthly meeting of executive officers consisting of directors, corporate auditors and executive officers shall be held regularly in accordance with SB's "Rules and Regulations for the Monthly Meeting of Executive Officers". Policies on business activities shall be announced and the status of the performance of business activities shall be reported at the monthly meeting of executive officers.
   
   
4. For the matters that require company-wide cross-divisional commitment, certain committees shall perform activities under the direction and supervision of the chairman appointed by the President of Sumitomo Bakelite Co., Ltd and significant matters shall be reported to the Board of Directors of SB.
   
   
5. "Internal audit divisions" of Sumitomo Bakelite Co., Ltd shall investigate and assess a system for managing and operating the overall business activities and the status of business operations, and shall provide advice and suggestions for improving the management efficiency.
   
   
   

Article 5.
Systems for ensuring the appropriate operations of Sumitomo Bakelite Co., Ltd and its subsidiaries

1. Sumitomo Bakelite Co., Ltd shall familiarize all companies of Sumitomo Bakelite Group with SB's "Business Philosophy" which states, "Our company strives to make a contribution to social progress and a higher standard of living through its business activities by placing prime importance on integrity and sound management." In addition, SB shall take advantage of group synergy and achieve the best results as a group to promote group management, by sharing their strategies with other companies in Sumitomo Bakelite Group or understanding the strategies of the other companies in Sumitomo Bakelite Group.
   
   
2. Sumitomo Bakelite Co., Ltd shall specify the criteria and extent of the our involvement in SB's subsidiaries' decision-making process in SB's "Administration Rules for Affiliated Companies" in order to respect the self-management of its subsidiaries and ensure the appropriateness of business activities of the Sumitomo Bakelite Group.
   
   
3. Sumitomo Bakelite Co., Ltd shall design and operate a system for information management, risk management and compliance related to the performance of duties by directors and employees of SB's subsidiaries.
   
   
4. Sumitomo Bakelite Co., Ltd shall specify the items on to-do list for SB's consolidated subsidiaries through "Comprehensive Guidelines for Internal Control to setout basics for Internal Control System and sustainable operation of Internal Control activities.
   
   
5. Persons responsible for the performance of business activities of the Sumitomo Bakelite Co., Ltd and its subsidiaries shall meet regularly to make management policies known to every company and facilitate communication within the Sumitomo Bakelite Group.
   
   
6. "Internal audit divisions" of the Sumitomo Bakelite Co., Ltd shall investigate and assess a system for managing and operating the overall activities of the Sumitomo Bakelite Group and the status of business operations in terms of legitimacy and reasonableness and provide the Sumitomo Bakelite Co., Ltd and its subsidiaries with advice and suggestions for improvement and rationalization.
   
   
   

Article 6.
Systems for ensuring the effective audit by corporate auditors

1. Matters relating to employees assisting duties of corporate auditors and matters relating to the independence of such employees from directors
   
   
   • Sumitomo Bakelite Co., Ltd shall establish a post of "corporate auditors' assistants" who assist the duties of SB's cooperate auditors. SB shall make an effort to review the number and competence of the corporate auditors' assistants upon the request of the Board of Corporate Auditors of SB.
     
     
   • Corporate auditor's assistants shall perform their duties under the direction and supervision of the corporate auditors. Sumitomo Bakelite Co., Ltd shall consult with the Board of Corporate Auditors in advance about the transfer of corporate auditors' assistants.
     
     
2. System for reporting to corporate auditors
   
   
   • Directors, executive officers and employees shall make a report required by the respective corporate auditors.
     
     
   • Important matters which require a final decision of the President shall be circulated to full-time auditors and the information on the matters to be resolved by the Board of Directors shall be notified to the respective cooperate auditors in advance.
     
     
   • If the directors, executive officers, and employees of Sumitomo Bakelite Co, Ltd find out the facts that may cause significant loss to Sumitomo Bakelite Co., Ltd and its affiliate and subsidiaries, that breaches or may breach its articles of incorporation, laws and regulations, or that is significantly unfair matters, they shall report to the corporate auditors .
     
     
     
3. Other systems for ensuring the effective audit by corporate auditors
   
   
   • Corporate auditors of Sumitomo Bakelite Co., Ltd may attend the important meetings on the financial condition and internal control of the SB to express their opinions.
     
     
   • Corporate auditors of Sumitomo Bakelite Co.,Ltd shall attend internal audit report sessions or meetings for reviewing internal control to the extent necessary to work together with the "internal audit divisions" and the accounting auditors.
     
     
   • The significant audit detail for the entire Sumitomo Bakelite Group in the annual audit plan prepared by the Board of Corporate Auditors shall be notified to directors and executive officers, and the directors and executive officers shall cooperate in such audit.
     
     
   • The Representative Director of Sumitomo Bakelite Co., Ltd shall regularly consult with the corporate auditors to exchange their opinions in order to secure the appropriateness of the performance of business activities.