…Daikin Malaysia (“DAMA”) is still purchasing from Kawaguchi Manufacturing…As of today, DAMA has not decided yet whether to terminate its purchases from Kawaguchi. Also Daikin Industries … understands that by terminating purchases we may create another human rights violation because those workers may be laid off due to the decrease of Kawaguchi’s sales…

DAMA and Kawaguchi signed a “Master Agreement for Supply of Goods and/or Services” on 01/08/2022…as a result of subsequent CSR questionnaires, we determined that a corrective action plan and further in-depth audit is necessary, however, these actions have not been completed until today.

DIL received this allegation through Daikin Europe N.V. (DENV) on 02/08/2024…Accordingly, DAMA visited Kawaguchi’s premises on 04/09/2024 and 06/09/2024 to discuss the situation with Kawaguchi, and as a result of such discussions, DAMA received a written statement in which Kawaguchi committed to pay the salaries on a schedule. DIL and DAMA has been continuously monitoring whether such commitments are being kept.

The Ministry of Human Resources Malaysia invited DAMA HR to a formal meeting…DIL and DAMA are currently contemplating the remedies and measures to be taken for the workers…DIL will make best efforts to investigate the root cause of this issue, i.e., why this incident occurred…