Officers Remuneration Relationship

The Compensation Committee held on March 26, 2025 resolved a Basic Policy on Officer Remuneration.

Basic Policy on Officer Remuneration

As a company with a Nominating Committee, etc., the Company has established a Compensation Committee as required under the Companies Act. The chairperson is selected from among the Outside Directors. Individual remuneration for officers (Directors and Executive Officers) is determined while ensuring objectivity and transparency.

(1) Roles of officers and remuneration

The roles expected of officers are to enhance corporate value over the short, medium, and long term, and remuneration is intended to function effectively as an incentive for fulfilling these roles.

(2) Level of remuneration

The level of remuneration should be appropriate to reflect the roles, responsibilities, and performance of officers, taking into account changes in the business environment and comparative levels at other companies based on surveys by external specialized organizations.

(3) Composition of annual remuneration

Annual remuneration comprises fixed remuneration (base compensation) and incentive remuneration (bonus and stock-based compensation).

Base compensation
A fixed amount, determined according to the officer's position, is paid as monthly remuneration.
Bonus
As a short-term incentive, a bonus is paid once a year based on a standard amount determined by position, reflecting the evaluation of period performance against financial and non-financial indicators. The indicators are reviewed and selected each year.
Stock-based compensation
For Directors, as a non-monetary, medium- to long-term incentive, points are granted based on a standard amount determined by position, and shares are delivered upon retirement according to the number of points.
For Corporate Executive Officers, as a non-monetary, medium- to long-term incentive, points are granted based on a standard amount determined by position, reflecting the evaluation of period performance against financial and non-financial indicators, and shares are delivered upon retirement according to the number of points.

Remuneration for Directors consists of base compensation and stock-based compensation, while remuneration for Executive Officers (including those concurrently serving as Directors) consists of base compensation, bonus, and stock-based compensation.
The composition ratio is as follows: for Directors, base compensation accounts for approximately 90% and stock-based compensation approximately 10%. For Corporate Executive Officers (including those concurrently serving as Directors), base compensation accounts for 50–60%, bonus 20–30%, and stock-based compensation 10–20%.