Directors' Remuneration

Disclosure of Individual Directors’ Remuneration

The aim of the remuneration of officers of the Company is to secure, retain, and motivate outstanding talent in management in order to achieve sustainable growth and the medium- to long-term enhancement of corporate value of the Company and the Company Group. To that end, the Company's basic policy is to determine remuneration through a transparent and objective process that maintains an appropriate link between remuneration and performance and in which remuneration functions as a sound incentive.

Remuneration system

The remuneration of the officers of the Company is composed of basic remuneration and performance-linked remuneration, which are deliberated and determined by the Board of Directors based on comparisons with peers or with other companies of comparable size, as well as the Company’s financial situation and the individual’s degree of contribution.
Furthermore, in order to increase the independence and objectivity of the functions of the Board of Directors, the Company has established a Nomination and Compensation Committee as a voluntary advisory body to the Board of Directors. Variable remuneration such as performance-linked remuneration is not suitable for Outside Directors and Directors and Audit & Supervisory Board Members, so only “basic remuneration” is paid to them.

Basic remuneration

A fixed amount of basic remuneration is paid to Directors based on their individual positions and responsibilities. The amount of remuneration for Directors serving as Audit & Supervisory Board Members is decided through discussion of each Audit & Supervisory Board Member.

Performance-linked remuneration

Performance-linked remuneration comprises monthly remuneration, which is incentive remuneration that varies depending on short-term performance, tax-qualified stock options (non-monetary remuneration, etc.), which are medium- to long-term incentive remuneration, and performance-linked stock remuneration (non-monetary remuneration).
Monthly remuneration is paid at an amount calculated according to the degree of achievement of the targets for net income attributable to owners of the parent for each fiscal year.

Policy on Determining Remuneration Amounts and Calculation Methods

In deciding the amount of remuneration for each Director (excluding Directors serving as Audit & Supervisory Board Members), the Board of Directors requests deliberation by the Nomination and Compensation Committee and decides the amount, taking the results of deliberation by the Nomination and Compensation Committee into due consideration.

Directors are paid the amount of basic remuneration determined by the Board of Directors based on the Director’s position and responsibilities.

The Board of Directors shall consult with the Nomination and Compensation Committee on deciding the specific details of monthly performance-linked remuneration.
The content of such authority is as follows:
With regard to performance-linked remuneration for each Executive Director, the Nomination and Compensation Committee confirms the reasonableness and appropriateness of the evaluations of the results and the degree of contribution for each Director’s individual performance indicators submitted by the Representative Director, and then enters these performance indicators into the calculation framework decided on by the Board of Directors to determine the amount of remuneration for each individual.
With regard to stock remuneration, points are granted to each Director based on the Stock Grant Rules decided on by the Board of Directors. When the designated conditions are met, Company shares are granted to the Director using the designated method for delivering Company shares to Directors.

The Nomination and Compensation Committee is composed of three Outside Directors and two Representative Directors and is chaired by an Outside Director.
The activities of the Nomination and Compensation Committee consist of deliberation regarding candidates for Directors, evaluation of each Director and deliberation regarding the amount of remuneration to be paid to each individual, the revision of regulations such as Director Regulations, and the reporting of these results to the Board of Directors.

[Total amount of remuneration, etc. for each category of officer, total amount by type of remuneration, etc., and number of recipients]
(Note) The total amount of remuneration, etc. by individual is omitted, as no officer received ¥100 million or more.

as of June 26, 2024