Standards and Procedures for Appointment and Dismissal of Directors
The Company, conscious of its fiduciary responsibility to its shareholders, has established the following "Standards and Procedures for Appointment and Dismissal of Directors" for the purpose of ensuring and enhancing the effectiveness of the Board of Directors in appropriately fulfilling its roles and responsibilities in selecting candidates for and dismissing directors.
1. Selection Standards for Directors
- (1)The Company shall select candidates for Directors from among those who satisfy the following requirements, in addition to fulfillment of the requirements under laws and regulations and the Articles of Incorporation, non-applicability of the disqualification grounds stipulated in the Directors Regulations, and current and past non-involvement with anti-social forces.
- (2)Each of the following requirements is set forth in a way mindful of the organic integration of the roles of the Board of Directors and the Audit & Supervisory Committee, the respective roles of Executive Directors, Non-Executive Directors including Independent Outside Directors, and Audit & Supervisory Committee Members (including, but not limited to, the matters described in 3-3. through 3-5. and 3-13. through 3-14. of the Corporate Governance Guidelines), and the skill matrix of the Board of Directors. These requirements may be reviewed in accordance with changes in the business environment and management strategies, the content of management plans, the progress and necessity of business structure transformation, and other circumstances.
"Prerequisites" for All Directors | |
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"Common Requirements" for Outside Director | |
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Requirements for Each Role in particular | |
Outside Director (excl. Audit & Supervisory Committee Member) | Outside Director (Audit & Supervisory Committee Member) |
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Executive Director | Audit & Supervisory Committee Member (excl. Outside Director) |
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2.Dismissal Standards for Directors
The Company shall take the prescribed procedures for the dismissal of the Director if he/she meets any of the following conditions.
- The Director commits a serious act against laws and regulations, the Articles of Incorporation, or public order and morals due to malicious intent or gross negligence.
- The Director has maliciously or grossly negligently failed to perform his/her duties, and has significantly damaged the corporate value of the Group.
- It becomes difficult for the Director to continue his/her duties due to health conditions.
- The Director falls under any of the disqualification grounds for Directors stipulated by laws and regulations.
- The Director does not possess the qualities required by the "Selection Standards for Directors".
3. Reappointment of Directors
The Company shall consider the following points when reappointing Directors.
- Contribution during term of office is considered sufficient in light of the Selection Standards for Directors and the requirements stipulated in the standards are fulfilled at the time of reappointment.
- Useful comments at board meetings during term of office that contribute to business growth, management improvement, legal compliance, risk management, etc.
- Attendance rate at Board of Directors meetings during term of office must be 75% or more.
- No inappropriate behavior as a director during term of office.
- Concurrent positions at other companies outside the Group at the time of reappointment are not expected to interfere with the performance of duties at the Company.
- For Outside Directors, the maximum total number of years in office (including the number of years served as an Outside Audit & Supervisory Board Member) shall be 10 years, as a guideline. However, if there are reasons or circumstances that require reappointment beyond 10 years, the Nomination and Compensation Committee and the Board of Directors may reappoint the Outside Director after due deliberation, in which case the reasons and circumstances shall be explained to shareholders and other stakeholders.
- If an Executive Director has been under-performing for three consecutive terms, his/her reappointment shall be subject to careful and thorough deliberation.
4. Procedures for Appointment and Dismissal of Directors
- (1)The Board of Directors shall select candidates for director to be proposed to the General Meeting of Shareholders and propose the dismissal of directors to the General Meeting of Shareholders. In doing this, it shall select candidates for director (excluding those who are Audit & Supervisory Committee Members) and candidates for Audit & Supervisory Committee Member through resolution after due deliberation based on the Selection Standards for Directors and views on the composition of the Board of Directors and the Audit & Supervisory Committee (please refer to 3-2. and 3-12. of the Corporate Governance Guidelines).
- (2)In making the above resolution, the Board of Directors shall go through deliberations at the Nomination and Compensation Committee and shall obtain the prior consent of the Audit & Supervisory Committee with respect to candidates for directors who are Audit & Supervisory Committee Members. If there are any opinions determined by the Audit & Supervisory Committee regarding the candidates for directors (excluding Audit & Supervisory Committee Members), such opinions shall be reflected to the maximum extent possible.
- (3)The General Meeting of Shareholders shall decide by its resolution on the Director candidates/the Directors subject to dismiss proposed by the Board of Directors. The Audit & Supervisory Committee shall express its opinion at the General Meeting of Shareholders when it deems necessary.
Reference) Reason for appointment / Skill matrix for the Board of Directors
Outside Directors
Name | Reason for appointment |
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Masahiko Ito | Mr. Masahiko Ito has extensive corporate management experience, having served as the Representative Director and President of a major listed manufacturing company. He has a proven track record of executing business structural reforms and revitalizing management structure to transform the corporation into a phase of sustainable growth. Further, he possesses advanced knowledge of corporate governance and experience as a Chairperson of the Board of Directors. Since his appointment as Outside Director of the Company in September 2024, he has provided opinions and advice at the Board of Directors meetings, particularly from a broad and high-level perspective concerning the overall management of the Group and he has provided proper oversight by objectively assessing business matters affecting the Company. In addition, as a member of the Nomination and Compensation Committee, he has contributed to the strengthening of management functions by providing necessary and appropriate advice in the deliberation of executive appointments and compensation proposals. Mr. Masahiko Ito has been again selected as a candidate for another term as Independent Outside Director because the Company expects that he will fulfill the above role with the aim of enhancing its shareholder value continuously. |
Kazuhiko Yamada | Mr. Kazuhiko Yamada, although he has no direct experience in corporate management, possesses extensive experience and knowledge as an attorney particularly in the fields of corporate acquisitions, corporate restructuring, equity practice, etc., the Companies Act, and the Financial Instruments and Exchange Act. Since his appointment as Outside Director of the Company in September 2015, he has provided opinions and advice particularly with respect to strengthening corporate governance practices at meetings of the Board of Directors and has provided proper oversight by objectively assessing business matters affecting the Company. In addition, as a member of the Nomination and Compensation Committee, he has contributed to the strengthening of management functions by providing necessary and appropriate advice in the deliberation of executive appointments and compensation proposals. Mr. Kazuhiko Yamada has been again selected as a candidate for another term as Independent Outside Director because the Company expects that he will fulfill the above role with the aim of enhancing its shareholder value continuously. |
Shoko Takase | Ms. Shoko Takase possesses experience as an executive at a global IT company, and has a proven track record in driving customers transformation through the use of IT technology, along with a broad knowledge of customer and technology trends. Since her appointment as Outside Director of the Company in September 2021, with the aim of expanding the solution business focusing on the digital domain, she has actively provided recommendations and advice at the Board of Directors meetings from a practical perspective and proper oversight by objectively assessing business matters affecting the Company. In addition, as a member of the Nomination and Compensation Committee, she has contributed to the strengthening of management functions by providing necessary and appropriate advice in the deliberation of executive appointments and compensation proposals. Ms. Shoko Takase has been again selected as a candidate for another term as Independent Outside Director because the Company expects that she will fulfill the above role with the aim of enhancing its shareholder value continuously. |
Audit & Supervisory Committee Members
Name | Reason for appointment |
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Rumiko Tanabe | Ms. Rumiko Tanabe possesses wide-ranging knowledge in finance, accounts, overall audit, corporate governance, etc., accumulated through her experience in financial accounting operations in listed enterprises and auditing subsidiaries in addition to her professional expertise as a certified public accountant. Since her appointment as Outside Audit & Supervisory Board Member in September 2020, she has exercised her duties as Outside Audit & Supervisory Board Member appropriately by stating effective opinions at the Board of Directors and the Audit & Supervisory Board, etc. She also has a high degree of expertise and professional knowledge gained through serving as Audit & Supervisory Board Member of another company. Based on these reasons, Ms. Rumiko Tanabe has been selected as Outside Director who is an Audit & Supervisory Committee Member. |
Masatoshi Deguchi | Mr. Masatoshi Deguchi has diverse experience in operations at a major general trading company, including finance, accounting, and tax practices, as well as in serving as a corporate manager at an overseas subsidiary and head of an internal auditing department. He also has experience as a corporate manager at other listed companies and extensive knowledge in risk management and internal controls. Since his appointment as Outside Director who is an Audit & Supervisory Committee Member since September 2023, he has been fulfilling his duties effectively by providing valuable insights during audits, and at the Board of Directors meetings and the Audit & Supervisory Committee meetings. Mr. Masatoshi Deguchi has been again selected as a candidate for another term as Independent Outside Director who is an Audit & Supervisory Committee Member because the Company expects that he will provide oversight, auditing and advice from a neutral and objective perspective. |