1. Basic Partnership Policy

In every industry, we exclude incapable or ill-qualified companies (without limiting ourselves to working with existing partners) and introduce new low-cost companies proactively. We respect partner specialist companies as equals, but also encourage them to remain aware that only the fittest can remain with us as business partners (eliminating structures of dependence). In this way, we work to discover and select vibrant and excellent partner companies.

2. Our Image (Vision) regarding Excellent Partner Companies

We seek partner companies that possess the capabilities to fulfill their responsibilities as independent entities without fail and have mutual trust with us. Partner companies must fulfill the following requirements:

1. a. Able to independently manage the safety, environment, quality, cost, and construction period of a subcontracted construction project as per the agreement.
2. Possesses unique technologies and makes active efforts to improve and develop technologies.
3. Boasts superb skills and skilled workers and offers extensive training programs.
4. Has a stable management base, strives to streamline operations, and fosters successors.
5. Able to conduct business in a deliberate and independent manner, and execute planned activities in reality.

Partner specialist companies that have unique technologies and skills as well as outstanding foremen that generate profit (key people on construction sites) are valuable for our production strategies. We select priority companies for management from among these using an evaluation system or by other means, and we then select and secure excellent partner companies with a focus on renewing this selection.

In order to promote the policies and measures above, we establish basic measures for the civil engineering and building business while taking into account the specificity of each business.

1. Basic Measures for the Civil engineering Business

While keeping our civil engineering business financially independent on a per-site basis, we promote the following measures:

(1) Selecting and using priority management companies (specialist companies) with a focus on renewing this selection

1. Stratify partner companies according to the scope of business activities (business areas) and business type and reduce the number of partner companies that branch offices require, in consideration of branch office demands (technological capabilities, drawing power, etc.) and evaluation results (parent companies and construction results). This is carried out by convening the selection board (tentative name) in which several site managers participate in principle, and selecting an appropriate number of priority management companies with a focus on actively reviewing this selection.
2. If a partner company operates across our branch offices over a wide area and has the will and capabilities to expand its business on a companywide basis, designate it as a priority management company and coordinate order placements and management at the Head Office on a nationwide level based on requests from branch offices.
3. Offer guidance to priority management companies on planned order placements (similar in meaning to leveled order placements) and provide site foremen with guidance in order to help boost their self-management capabilities and competitiveness.
4. Pay regular visits to priority management companies in order to understand their management policies and conditions accurately and provide guidance and advice on management by presenting evaluation results or other information as needed.
5. Seeing that excellent skilled workers, foremen in particular, are a source of profit, develop systems to evaluate construction results and reward outstanding foremen and other personnel in order to retain them.

(2) Applying the principle of competition and utilizing new companies based on proper evaluation of cost and capabilities

1. In principle, ask several companies for quotes and, after an adequate process of comparison, deliberations, and negotiations (consideration of total costs), make a contract with the company that offered the lowest price. For partner specialist companies, apply the principle of competition reciprocally after stratifying them in consideration of priority management companies.
2. Open the doors wide without restricting ourselves just to existing companies, and actively promote the entrance of new companies that possess a suitable degree of proficiency (companies that can serve as a positive boost in terms of cost and technology).
3. Reduce uncertainties by clarifying the terms of contracts (quotes), ensure the strict observance of contracts (eliminate structures of dependence), and cultivate an environment where it is possible to discuss changes in design.

(3) Preparing and utilizing of information on partner companies that serves as a basis for selection, guidance, and other managerial activities

1. Prepare information related to the evaluation of construction work results, the track record of construction, and management conditions (finances, credit, etc.).
2. Utilize objective information from the perspective of all branch offices or from a company-wide perspective when selecting companies, when providing guidance to companies, and when excluding incapable or ill-qualified companies.
3. Clarify the roles and positions of organizations for partner companies, such as Rokueikai and the Kajima Business Partners' Association, and promote activities in line with the objectives (cost reduction, productivity improvement, quality and safety assurance, contributions to receiving orders, etc.).

2. Basic Measures for the Building Business

For our building business, we strive to boost the procurement capabilities of our branch offices while promoting the following measures:

(1) Applying the principle of competition and utilizing of new companies based on proper evaluation of cost and capabilities

1. With respect to selection, strengthen the competitive environment centered around the procurement divisions of branch offices. Secure several partner specialist companies while taking into account the competitive environment and regional production systems.
2. Open the doors wide without restricting ourselves just to existing companies, and facilitate the entrance of new low-cost companies that possess a suitable degree of proficiency.
3. Clarify the responsibilities and rights of both parties and ensure the strict observation of contracts in accordance with the principle of "contract documents (basic construction subcontracting agreements, quote and order terms, etc.) come first."
4. Request a proposal for VE (Value Engineering) and productivity improvement (consideration of incentives) when a quote is presented and create an environment for driving forward, such as through the enhancement of VE training and through improvement activities for major partner companies.
5. Evaluate, select, and utilize partner specialist companies in an appropriate manner based on a multifaceted outlook that incorporates factors such as price competitiveness and self-management capabilities, while comparing them the image that we hold regarding excellent partner companies.

(2) Awareness program to help partner specialist companies promote efforts to operate independently and train successors

1. Place fewer orders with partner companies that seem to have no future growth potential (efforts to operate independently) based on the principle of the survival of the fittest, thereby leading to them being less dependent on us (natural selection).
2. Inform the CEOs of partner companies, priority management companies in particular, of the image we have regarding excellent partner companies and the business attitudes that we pursue through procurement activities in principle, and support a wide range of activities that contribute to improving productivity (certificate acquisition, VE training, etc.).
3. Evaluate partner companies based on their past contributions to us (such as track records in construction) as well as their current performance and future prospects. In addition, from the perspective of risk management, visit the offices of major partner companies involved in construction (on an irregular basis) in order to obtain accurate management information.

(3) Preparing and utilizing information on partner companies that serves as a basis for selection, risk management, etc.

1. Manage the evaluations of the construction results when construction is complete, the track records of construction, and the management conditions (finances, credit, etc.) in a comprehensive manner at each branch office.
2. For some partner companies that operate nationwide, promote information exchanges and activities by building a branch-office network.
3. Understand (for example, through the maintenance of work ledgers) the multistoried subcontract structure that is generally considered a factor for occupational accidents and higher costs, promote the utilization of information from the perspective of safety and procurement, clarify the roles and responsibilities of primary subcontractors, and implement thorough management over lower subcontractors.
4. Clarify the roles and positions of organizations for partner companies, such as Rokueikai and the Kajima Business Partners' Association, and promote activities in line with our objectives (cost reduction, productivity improvement, quality and safety assurance, and contributions to receiving orders).
5. Set incentives for effective sales information (rewards for contributions to receiving orders) in order to establish a system for collecting sales information from local region-oriented general contractors and partner facility companies.