Introducing Performance-Linked Compensation

「For the current fiscal year, the amount of compensation and other remuneration for the Company's directors was determined as follows: the compensation of directors who are not Audit and Supervisory Committee members was deliberated and determined at a meeting of the Board of Directors held on 29 June 2021, while the compensation of directors who are Audit and Supervisory Committee members was discussed and determined by the Audit and Supervisory Committee at its meeting held on 29 June 2021.」

「Based on a resolution of the Board of Directors, we revised the executive compensation system effective 29 June 2021. The main change from before the revision was to change the structure from entirely fixed compensation to one comprising fixed compensation and performance-linked compensation. Under the policy, a performance-linked base amount is established for each executive position, and the performance-linked amount for the following fiscal year is determined based on the rate of change in unconsolidated net income for the current fiscal year at each fiscal year-end. Regarding the proportion of fixed and performance-linked compensation, the policy is for performance-linked compensation to account for approximately 20% to 40% of total compensation, with the proportion increasing for higher-ranking positions.」