To: IFRS Foundation

Keidanren welcomes the opportunity to comment on the Exposure Draft on Proposed Targeted Amendments to カジノシークレット キャッシュバック 上限FRS Foundation Constitution to Accommodate an International Sustainability Standards Board to Set IFRS Sustainability Standards (hereinafter "Proposed Amendments to カジノシークレット キャッシュバック 上限FRS Foundation Constitution").

(General Remarks)

Since the establishment of カジノシークレット キャッシュバック 上限FRS Foundation, we have always supported its activities. Through personnel and financial support, submission of our opinions to カジノシークレット キャッシュバック 上限nternational Accounting Standards Board (IASB), and other means, we have contributed to the development of カジノシークレット キャッシュバック 上限nternational Financial Reporting Standards (IFRS) toward the realization of a single set of high-quality global standards as well as to their dissemination in Japan.

As stated in our last year's Comments on the Consultation Paper on Sustainability Reporting by カジノシークレット キャッシュバック 上限FRS Foundation (2020-12-18), we respect and support カジノシークレット キャッシュバック 上限FRS Foundation's initiative to develop global sustainability reporting standards. Once an International Sustainability Standards Board (ISSB) is established under fair and transparent processes and sets off to develop global sustainability reporting standards, we are ready to contribute to the endeavor in various forms and ways.

We support the strategic direction presented by カジノシークレット キャッシュバック 上限FRS Foundation, which we find is consistent with what we stated in our comments on the consultation paper. Particularly, we find it reasonable that in its standard-setting efforts, カジノシークレット キャッシュバック 上限SSB should focus on information which is material to the decisions of investors (single materiality), prioritize the development of climate-related reporting standards, and build on the existing frameworks and work such as the work of the Financial Stability Board's Task Force on Climate-related Financial Disclosures (TCFD).

The "Proposed Amendments to カジノシークレット キャッシュバック 上限FRS Foundation Constitution" reflect the strategic direction and we find them generally reasonable. On the other hand, we believe that the development of sustainability reporting standards by カジノシークレット キャッシュバック 上限SSB should be carried out as a public interest activity, maintaining neutrality free from political and commercial pressure, as is the case for the activities of カジノシークレット キャッシュバック 上限ASB. To that end, it is essential that 1) selection of カジノシークレット キャッシュバック 上限SSB members, 2) development of standards, and 3) fundraising will be done using fair and transparent criteria and processes. It should be kept in mind that if カジノシークレット キャッシュバック 上限FRS Foundation ends up contradicting the existing rules of its Constitution or disregarding the fairness and transparency of its processes by rushing to establish カジノシークレット キャッシュバック 上限SSB and make it start working on the development of standards, not only the credibility of カジノシークレット キャッシュバック 上限SSB's standard-setting efforts in the future but also the credibility of カジノシークレット キャッシュバック 上限FRS Foundation and カジノシークレット キャッシュバック 上限ASB that has been built over the years would be undermined.

Based on (General Remarks), we make the following requests:

(Specific requests)

1. ISSB members

• To enable カジノシークレット キャッシュバック 上限SSB to develop standards in a way conducive to the public interest, it is essential to reflect views of various countries and regions in a well-balanced manner without bias in favor of カジノシークレット キャッシュバック 上限nterests of any specific country, region, or stakeholder.

• In this regard, the "Proposed Amendments to カジノシークレット キャッシュバック 上限FRS Foundation Constitution" call for creating a greater number of "at-large" seats for カジノシークレット キャッシュバック 上限SSB while reducing the number of seats representing each region by one, as compared to those for IASB. We believe that geographical balance among カジノシークレット キャッシュバック 上限SSB members, including those in the at-large seats, should be equivalent to that of カジノシークレット キャッシュバック 上限ASB to reflect views of various countries and regions in a well-balanced manner. Even in the case the seat allocation remains as proposed in the current "Proposed Amendments to カジノシークレット キャッシュバック 上限FRS Foundation Constitution", consideration should be given to ensure that those four members appointed to the at-large seats will not disproportionately represent any specific geographic region, and we request that a provision to this effect be included in the Constitution.

• Section 43 of the "Proposed Amendments to カジノシークレット キャッシュバック 上限FRS Foundation Constitution" states that the "work of カジノシークレット キャッシュバック 上限SSB shall not be invalidated by its failure at any time to have a full complement of members." However, given カジノシークレット キャッシュバック 上限mportance of the standard-setting process, we believe that カジノシークレット キャッシュバック 上限SSB should be required in principle to have a full complement of 14 members, or at least, to ensure that it has more than a certain number of members and a well-balanced geographical representation.

• The "Proposed Amendments to カジノシークレット キャッシュバック 上限FRS Foundation Constitution" limit the number of part-time members to a "minority of ISSB members." However, to enable カジノシークレット キャッシュバック 上限SSB to appoint highly competent individuals from diverse backgrounds as its members for the development of high-quality sustainability reporting standards, we believe that the number of part-time members should not be limited too strictly. For instance, while part-time members should be required to ensure a level of independence, consideration should be given in recruiting them to allow flexibility depending on the needs of applicants, rather than limiting their number to very few.

• On top of the foregoing, we call for ensuring the fairness and transparency of the process for selecting ISSB members to secure the credibility of カジノシークレット キャッシュバック 上限SSB.

2. Due process for standard-setting

• To enable カジノシークレット キャッシュバック 上限SSB to secure the trust of many stakeholders for its standard-setting activities, it is essential to build and operate a fair and transparent standard-setting process.

• According to the "Proposed Amendments to カジノシークレット キャッシュバック 上限FRS Foundation Constitution", the voting requirement for カジノシークレット キャッシュバック 上限SSB's approval is a simple majority, whereas stricter requirements are set for カジノシークレット キャッシュバック 上限ASB as follows: "The publication of an Exposure Draft, or an IFRS accounting standard ... shall require approval by eight members of カジノシークレット キャッシュバック 上限ASB, if there are 13 members or fewer, or by nine members if there are 14 members." We believe that カジノシークレット キャッシュバック 上限SSB's voting requirements should be equivalent to those of カジノシークレット キャッシュバック 上限ASB because having approval from a considerable number of ISSB members is indispensable to ensuring the credibility of standard-setting activities.

• Section 54 of the "Proposed Amendments to カジノシークレット キャッシュバック 上限FRS Foundation Constitution" says that in the process of establishing カジノシークレット キャッシュバック 上限SSB, a proposed work plan for カジノシークレット キャッシュバック 上限SSB may be published with approval of the Chair and the Vice-Chair of カジノシークレット キャッシュバック 上限SSB. Such publication should be treated as an exception and kept to the minimum, and the general rule should be for decisions to be made by a geographically balanced board.

3. Funding

• Ensuring the fairness and transparency of funding is indispensable to enabling カジノシークレット キャッシュバック 上限SSB to maintain neutrality, free from political and commercial pressure and to develop standards conducive to the public interest.

• In this regard, excessive reliance on specific countries or institutions for funding that could affect, or call into question, カジノシークレット キャッシュバック 上限ndependence of カジノシークレット キャッシュバック 上限SSB should be strictly avoided. Accordingly, we believe that objective criteria for funding, such as pro-rata shares based on GDP, should be established and contributions should be sought from each country based on the criteria as is the case with the current funding arrangement of カジノシークレット キャッシュバック 上限FRS Foundation.

• In addition, カジノシークレット キャッシュバック 上限FRS Foundation should ensure separate management of funding for カジノシークレット キャッシュバック 上限ASB and that for カジノシークレット キャッシュバック 上限SSB to enable them to pursue their respective activities without hindering each other. Particularly, in executing budgets, カジノシークレット キャッシュバック 上限ASB and カジノシークレット キャッシュバック 上限SSB should be treated as separate segments and uses of funds should be clearly accounted for on a segment-by-segment basis in financial reporting.

4. Other

• The Accounting Standards Advisory Forum (ASAF), a forum for hearing opinions of national standard setters to provide advice to カジノシークレット キャッシュバック 上限ASB, has been functioning effectively as a mechanism for ensuring that national circumstances are taken into consideration in the development of カジノシークレット キャッシュバック 上限FRS. Likewise, in developing sustainability reporting standards, we believe that consideration should be given to the circumstances of each country or jurisdiction. Thus, we request カジノシークレット キャッシュバック 上限FRS Foundation to consider establishing an advisory body akin to the ASAF comprising national and regional representatives.

We hope our comments are helpful to カジノシークレット キャッシュバック 上限FRS Foundation's deliberation. We strongly hope that カジノシークレット キャッシュバック 上限SSB will start working on the development of high-quality sustainability reporting standards after カジノシークレット キャッシュバック 上限FRS Foundation Constitution is duly amended, and rules for member selection and funding arrangements are determined, using fair and transparent criteria and processes.