Compensation for Directors and Audit & Supervisory Board Members

The Company has established the following basic policy for determining the details of compensation, etc., as a means to strengthen the Company’s group governance and to enhance the Company’s corporate value over the medium to long term.

Directors (excluding External Directors)
-Establish a compensation plan that contributes to the sustainable growth of the Company and the improvement of its corporate value over the medium to long term.
-Set the competitive compensation level that can attract and retain excellent managerial talent.
-Establish a compensation plan commensurate with the role and extent of responsibility of Directors and their contribution to the performance of the Company.
-Establish a compensation composition ratio that fosters a sense of sharing value with shareholders.

External Directors
-Fixed compensation only, given their position of overseeing the management of the Company and the Company Group from an independent and objective standpoint

Audit & Supervisory Board Members
-Fixed compensation only, given the role of auditing the execution of duties by Directors from an objective standpoint 

The compensation for the Company’s Directors and Audit & Supervisory Board Members consists of three components, namely, fixed compensation as basic remuneration, performance-linked compensation as short-term performance-linked compensation, and stock-based compensation as incentives for medium- to long-term performance. The following table shows an outline of the compensation structure and the percentage used as a benchmark.

Note 1) Regarding the amount of compensation for the Company’s Directors, at the 104th General Meeting of Shareholders held on June 25, 2024, the Company resolved that the total amount of basic remuneration and performance-linked compensation shall be within 600 million yen per year (of which, the amount for External Directors shall be within 100 million yen per year).
Note 2) At the 104th General Meeting of Shareholders held on June 25, 2024, the Company resolved to limit the amount of compensation to the Company’s Audit & Supervisory Board Members to 120 million yen per year 

The compensation, etc., for Directors is determined by a resolution at the Board of Directors meeting within the total amount of compensation, etc., that was resolved in advance at the General Meeting of Shareholders. When deciding on compensation, etc., at the Board of Directors meeting, the Company ensures a fair process by enhancing transparency and objectivity, etc., through means such as having the Voluntary Nomination and Compensation Committee, which is composed of a majority of External Directors and serves as an advisory body to the Board of Directors, review the details and refer to external data on compensation as necessary. 

With regard to the amount of individual remuneration, the details are decided with a discussion between the Representative Directors, based on the results of a report by the Voluntary Nomination and Compensation Committee, in accordance with a resolution of the Board of Directors. 

The results of compensation, etc. for fiscal year 2024 for Directors and Audit & Supervisory Board Members are as below.