The maximum total amount of monthly remuneration for Directors is set out by a resolution of the General Meeting of Shareholders, and Directors shall not receive bonuses, retirement benefits, or other such benefits. The Board of Directors shall set internal regulations on directors’ remuneration upon obtaining the opinions of the Nomination and Remuneration Advisory Committee, comprising all Independent Executive Directors, and determine the amount of remuneration of individual Directors within the above-mentioned limit of monthly remuneration according to the Company’s business performance and other criteria. Directors and Executive Officers shall also receive a part of their fixed remuneration in the form of the Company’s shares at a rate calculated according to their positions, to clarify the link between the Company’s medium- and long-term business performance and share value, boost their motivation for contributing to the enhancement of the Company’s corporate value over the medium to long term, and share the value with shareholders.
At the 1st Ordinary General Meeting of Shareholders held on June 24, 2009, a proposal for the remuneration for Directors of the Company was approved by resolution, setting the amount of monthly remuneration to up to 36 million yen (monthly remuneration for External Directors accounting for up to 4 million yen). Thereafter, at the 11th Ordinary General Meeting of Shareholders held on June 20, 2019, a proposal to revise the remuneration for External Directors was approved by resolution, setting the amount of monthly remuneration to up to 8 million yen, while the total amount of remuneration for Directors (monthly remuneration accounting for up to 36 million yen) remained unchanged. The number of Directors subject to the said resolution is nine (9) (of which outside director is three (3)) as of June 20, 2019.
With regard to remuneration for Directors, the Company has provided for a method of determining the amount of remuneration in internal rules within the total amount of remuneration approved by resolution at the General Meeting of Shareholders. To be more specific, the amount of base remuneration of individual Directors is determined and paid after the amount of remuneration of individual Directors is set according to the base remuneration, position (such as Chairman, President, Deputy President, Senior Management Executive Officer and Senior Vice President) as well as job title (such as authority of representation, Chief Executive Officer, Chairman of the Board and Nomination and Remuneration Advisory Committee Member).Internal rules only provide for the method of determining the amount of monetary remuneration, and the Company does not pay Directors and Executive Officers any remuneration other than money, such as stock or stock acquisition rights, as consideration for execution of their duties.
As for Directors serving concurrently as Executive Officers, apart from the remuneration for Directors, fixed remuneration reflecting factors linked to performance is paid as remuneration for Executive Officers by adjusting incentives by multiplying the individual base remuneration calculated in accordance with internal rules by a coefficient linked to profit and performance (the amount of change in core operating income and net income (loss)). The said method has been employed because the index is clear and it can promote incentives since the remuneration will be increased or decreased according to an increase or decrease in the company profit. The Board of Directors has made a decision on this method after the Nomination and Remuneration Advisory Committee has concluded in its deliberations that it is appropriate. No incentive adjustment is made for Non-executive Directors including External Directors.
While the incentives for remuneration for Executive Officers mentioned above are adjusted based on the change in actual results in the previous fiscal year, as to the results of the entire company in the consolidated fiscal year under review, the consolidated core operating income was approximately 8.5 billion yen, up from approximately 6.3 billion yen in the previous fiscal year, an increase of approximately 2.3 billion yen year on year, and the consolidated net income (loss) was approximately 3.8 billion yen, up from approximately 2.3 billion yen in the previous fiscal year, an increase of approximately 1.5 billion yen year on year, which led to the increase in incentives as provided for in internal rules. The result of calculating the incentive adjustment for the consolidated fiscal year under review was reported at the Board of Directors meeting held on May 31, 2019. The individual fixed remuneration will be determined after the adjusted incentives are added to the individual base remuneration for the next fiscal year (FY2019).
Further, Directors join the Executive Shareholding Association, and contribute a certain percentage of money from the determined monthly remuneration to the Executive Shareholding Association and acquire the stock of the Company corresponding to a certain amount of money on a monthly basis, whereby they manage the company from the perspective of shareholders, focusing on mid-to long-term performance.
As to the establishment, revision and abolition of the internal rules providing for the remuneration for Directors, the Nomination and Remuneration Advisory Committee comprised of a majority of Independent External Directors will review the appropriateness, etc. of proposals discussed by the Representative Director of the Board, etc. and submit a report to the Board of Directors, and the Board of Directors will determine the establishment, revision and abolition of the internal rules taking into consideration the details of the report. Details of individual remuneration for Directors, etc. will not be determined at the discretion of the Representative Director of the Board again.
During the consolidated fiscal year under review, in relation to the review of the internal rules in FY2019, the Representative Director of the Board has consulted with the Nomination and Remuneration Advisory Committee on a proposal for amendment of internal rules, and the said Committee has reviewed the appropriateness, etc. of such proposal and submitted a report to the Board of Directors. The Board of Directors approved a resolution to amend part of the internal rules at the Board of Directors meeting held on March 22, 2019.
(From April 1, 2018 to March 31, 2019)
|Corporate officer title||Total
(Millions of yen)
|Total remuneration by type (Millions of yen)||Number of corporate
(excluding External Directors)
Audit &Supervisory Board
&Supervisory Board Members)
|External Corporate Officer||66||66||-||-||-||5|
1. The amount paid to Directors does not include the portion of employee's salary for Directors who concurrently serve as employees, and the Company shall not pay to Directors and Auditors bonuses, retirement benefits and other monetary remunerations other than the above remuneration amount, either.
2. No Officers receive 100 million yen or more from the Company and its consolidated subsidiaries.