Compensation System for Directors, Audit & Supervisory Board Members and Executive Officers
Method of Determining Compensation Amounts for Company Executives
The Company has established a compensation system for directors and corporate auditors based on the following policies,
- The compensation system should motivate the achievement of the management plan by "pursuing efficiency" based on the premise of "ensuring soundness and transparency".
- To promote efforts to realize medium- and long-term strategies with the aim of permanently enhancing corporate value.
- The remuneration level should be commensurate with the size of roles and responsibilities, reflecting the mission of each individual, and designed to differentiate remuneration according to the degree of achievement of management goals (results).
Compensation for directors
The Company sets fixed compensation amounts at appropriate levels by referring to third-party data. These
amounts differ according to executive rank and Group management responsibilities.
Variable compensation
is linked to single-year and medium- to long-term performance at an appropriate ratio. Annual payment amounts
are set to reflect performance with reference to the Company's performance in the preceding fiscal year and
achievement of planned targets, and to the business plan for the current fiscal year (amounts paid to
individual internal directors are based on evaluation of their individual performance). Restricted Stock
compensation (in principle, the amount will correspond to compensation for performance of duties in the first
year covered by Middle-Range Planning) is linked to medium- to long-term performance. Restricted Stock
compensation aims to further promote shared value with shareholders and provide an incentive to strive to
continually increase the Company's corporate value.
Compensation for external directors is composed
solely of fixed compensation.
Compensation for Audit & Supervisory Board members
Compensation for Audit & Supervisory Board members is set at an appropriate level that reflects their important role and responsibility for conducting rigorous legal audits that form the basis of compliance management for the Group and improve corporate value. As the role and responsibility of Audit & Supervisory Board members is to conduct rigorous legal audits unrelated to the Company's operating performance, their compensation is composed only of the fixed compensation portion, which is not affected by operating performance.
The amount of compensation for directors is determined by a resolution of the Board of Directors within the
limit of compensation approved at the General Meeting of Shareholders based on the deliberation and report of
the Compensation Committee, which is chaired by an independent external director and of which more than half
of the members are from outside the Company (external directors and external experts).
The Compensation
Committee also deliberates and makes recommendations on policies related to determining director compensation.
Based on these results, the Board of Directors resolves compensation amounts.
Summary of Compensation System for Directors, Audit & Supervisory Board Members and Executive Officers
Compensation Paid to Directors and Audit & Supervisory Board Members
Amount of Compensation, etc. for Directors and Audit & Supervisory Board Members for FY2023
| Category | Total amount of compensation (Millions of yen) |
Total amount by type of compensation (Millions of yen) |
Eligible number of executives |
||
|---|---|---|---|---|---|
| Fixed compensation | Variable compensation |
Non-monetary compensation included in the amounts shown at left |
|||
| Directors (Excluding External Directors) |
286 | 179 | 107 | 36 | 4 |
| Audit & Supervisory Board Members (Excluding External Audit & Supervisory Board Members) |
36 | 36 | - | - | 2 |
| External Directors | 24 | 24 | - | - | 4 |
| External Audit & Supervisory Board Members |
14 | 14 | - | - | 2 |
The amount of monetary compensation for directors was resolved at the 89th Ordinary General Meeting of
Shareholders held on June 23, 2006 to be no more than 450 million yen per year. As of the close of said
General Meeting of Shareholders, the number of directors was eight (including one external director).
Separately from the above compensation framework, a resolution was passed at the 101st Ordinary General
Meeting of Shareholders held on June 22, 2018 that the annual amount of compensation under the Restricted
Stock compensation plan shall not exceed 150 million yen and the maximum number of shares shall not exceed
39,000 shares per year (external directors are not eligible for the grant). The number of directors (excluding external directors) as of the close of said General Meeting of Shareholders was five.
The 107th Ordinary General Meeting of Shareholders held on June 21, 2024 resolved that the maximum number of shares of Restricted Stock compensation shall not exceed 150,000 shares (external directors are not eligible). As of the close of said General Meeting of Shareholders, the number of directors was four (excluding external director). In principle, the amount of this compensation is based on the assumption that an amount equivalent to the compensation for the execution of duties over the period covered by the Middle-Range Planning is paid as a lump sum in the first year of the period covered by the Middle-Range Planning.
The amount of monetary compensation for Audit & Supervisory Board members was resolved at the 88th Ordinary General Meeting of Shareholders held on June 24, 2005 to be no more than 70 million yen per year. As of the close of said General Meeting of Shareholders, the number of Audit & Supervisory Board members was four (including two external Audit & Supervisory Board members).
The breakdown of the total amount of non-monetary compensation to directors (excluding outside directors) is ¥36 million in restricted stock compensation.
Compensation Paid for Individual Directors in FY2023
(* Only Director remuneration amounts totaling over
100 million yen are listed.)
No one applies.