Remuneration and Other Matters Concerning Directors and Executive Officers
Compensation decision-making policy for Officers
The Compensation Committee makes decisions about the level and composition of compensation for Directors and Executive Officers. This committee also oversees decisions about the compensation of senior partner company executives by receiving reports from the Co-Presidents. To determine levels and composition of compensation, the committee collects and analyzes objective data such as social trends, compensation of executives at other companies, and compensation in the market for senior executives. In accordance with the Compensation Philosophy and Design Policies for the Compensation of the Representative Executive Officers & Co-Presidents, committee members use this information to hold fair and transparent discussions and make decisions.
- In order to implement ”Maximization of Shareholder Value” (MSV), to build a remuneration system that is transparent and satisfactory and to continue to provide appropriate motivation, incentives, etc., to key executives by implementing individual treatment based on the system.
- To be able to attract and keep management talent that excels at practicing MSV.
- To be able to continuously provide motivation so that maximum potential can be encouraged even under changing environments.
- To function effectively and in harmony with the current state of business development, level of maturity of organizational systems, organizational values, and the community.
Design Policies for the Remuneration of the Representative Executive Officers & Co-Presidents
Remuneration that contributes to MSV
Total remuneration is commensurate with the performance of the Representative Executive Officers & Co-Presidents
A remuneration structure that promotes appropriate and decisive risk-taking
Composition of executive compensation
Composition of Directors’ compensation
Compensation for Directors (Independent Directors) who do not concurrently serve as Executive Officers consists of “Job-based Compensation,” “Allowances for Committee “Long-term Incentives.”
“Long-term Incentives” are restricted stock compensation.
This is intended to promote further value sharing with shareholders toward the realization of MSV, as Directors not only supervise the Group’s management as Asset Assemblers, but also assume the role and risk-taking of making important decisions regarding the allocation of management resources entrusted to them by shareholders.
Composition of Representative Executive Officers & Co-Presidents’ compensation
For the Co-Presidents’ compensation, the optimal mix of cash and stock compensation is settled each fiscal year after determining the total amount of compensation. Specifically, the total amount of compensations for the following fiscal year is redefined each fiscal year from the ground up after a comprehensive evaluation of the performance of the Co-Presidents from both financial and non-financial perspectives of the previous fiscal year through close communication with the Co-Presidents and GKP, in addition to continuity with past compensations, market and peer benchmarking surveys, and other factors. The composition of cash and stock compensation is also reviewed each time. In this way, the compensations maximize motivation to realize MSV and incentivize further leaps forward.
Composition of Executive Officers’ compensation
Compensation for Executive Officers, excluding Representative Executive Officer & Co-Presidents, consists of “Job-based Compensation,” “Performance-linked Compensation.” and “Long-term Incentives,”The Compensation Committee decides the amount of “Performance-linked Compensation” and “Long-term Incentives” according to the evaluation by the Co-Presidents.
“Performance-linked Compensation” is a comprehensive evaluation based on a non-financial assessment in addition to a financial evaluation, in order to provide appropriate incentives through flexible and proper evaluation in a rapidly changing business environment. Non-financial assessment items are based on contributions related to governance, such as group internal controls including risk management, and achievements in diversity, equity and inclusion (DE&I), such as the creation of a highly dynamic work environment and culture for diverse human resources and human resource development.
“Long-term Incentives” are cash compensation, determined based on a comprehensive evaluation of longer-term sustainability, contribution to the overall optimization of the Group, and expectations for contributions, and paid out in thirds per fiscal year, over a three-year period.
Please see the Annual Securities Report for more information about the remuneration design processes and composition for Directors and Executive Officers.
Securities report (only Japanese)
See "Executive Compensation" for the details of executive compensation and other matters.