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Corporate Governance

The Compensation Policy and The Amount of Compensation

(Source: Reports for the 180th Fiscal Period)

(1) Compensation Policy

The Compensation Committee establishes compensation policy regarding compensation of each Director and/or Executive Officer as follows:
Since the main responsibility of Directors is to supervise the execution of the overall Group's business, "Compensation for Directors" is determined at an adequate level to secure highly competent personnel and ensure effective work of the supervisory function.
Since the responsibility of Executive Officers is to increase corporate value in their capacity as executives responsible for companies or divisions within the Group, “Compensation for Executive Officers” is divided into the fixed compensation and the performance-linked compensation, and determined at an adequate level to secure highly competent personnel and ensure the effectiveness of their compensation package as an incentive to improve business performance.

i. Compensation for Directors

Directors who do not serve concurrently as executive officers are paid the Base salary (fixed amount) in accordance with the scope of their responsibilities. An allowance is provided for non-residents of Japan (the country where the HQ is located).
Directors who concurrently hold office as an Executive Officer are paid the Base salary (fixed amount) in addition to Compensation for Executive Officers specified in (ii).

ii. Compensation for Executive Officers

Compensation for Executive Officers consists of Base salary (fixed amount), stock compensation (fixed amount), determined according to rank, and performance-linked compensation.

Performance-linked compensation is determined in accordance with the performance of the company overall and the divisions under the charge of the Executive Officer during the fiscal year, with cash and stock of the Company paid at a rate set according to rank.

With regard to the stock compensation and performance-linked compensation (shares) that is paid in the form of the Company's stock, mechanisms such as restricted stocks with transfer restrictions until retirement will be used, the effectiveness as an incentive for medium- to long-term improvement of business performance.

iii. Compensation standards

Compensation standards are determined at suitable levels as a global company, with the aim of securing highly competent management personnel. The compensation standards of other listed companies and payroll and benefits of employees are considered when determining the Company's compensation standards of management.

Compensation pertaining to the above is set as follows:

(non-executive officer)
Base salary + Allowance for non-residents of Japan
Executive Officer
(concurrently a director)
Base salary + Stock compensation + performance-linked compensation (shares and cash) + Directors' remuneration
Executive Officer
(not concurrently a director)
Base salary + Stock compensation + performance-linked compensation (shares and cash)

Amount of Compensation

Item Amount for total compensation (millions of yen) Fixed compensation (millions of yen) performance-linked compensation (millions of yen) Number of Directors/Executive Officers (persons)
Directors excluding Outside Directors 29 29 - 5
Outside Directors 116 116 - 8
Executive Officers 571 490 81 14

(Note) Amounts for total compensation, fixed compensation and performance-linked compensation include payments in stock.

It should be noted that in the consolidated amount of compensation, etc., no individual officer received ¥100 million or more.

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