Design of Performance-Linked Compensation Using ROE, Market Capitalization, and ESG
First written in FY2025-H1. 1 of 3 entries say "Reframed", first in FY2026-H1. Latest entry: FY2026.
The whole theme swung hardest in 2025: 4 of 19 companies on the "Worse" side.
23 other companies' latest entry also says "Advanced".
- FY2026AdvancedAnnual report
「① [Consolidated] ROE 5.0% or higher 6.36% 50% Achieved ② PBR 0.4x or higher 0.62x Achieved ③-1 External training assignments 50 people or more 51 people 20% Achieved ③-2 Sustainable investment and financing (Cumulative) ¥170 billion or more ¥188.9 billion 20% Achieved」
It was disclosed that the targets for ROE, PBR, external training assignments and sustainable investment and financing under performance-linked compensation for fiscal 2025 were achieved based on actual results. - FY2026-H1ReframedAnnual report
「① [Consolidated] ROE 5.0% or higher 50% 4.5% or higher 40% Below 4.5% 0% ② PBR 0.4x or higher 20% Promotion of ESG and human capital initiatives ③-1 External training assignments 50 people or more 20% ③-2 Cumulative sustainable investment and financing ¥170 billion or more (¥60 billion or more in fiscal 2025) 20% ¥160 billion or more (¥50 billion or more in fiscal 2025) 10%」
For performance-linked compensation for fiscal 2025, the structure was changed from the previous combination of ROE, the rate of change in market capitalisation and ESG initiatives to one using ROE of 5% or higher, PBR of 0.4x or higher, external training assignments, sustainable investment and financing and human capital initiatives. The ROE threshold was changed from the previous 6% or higher to 5% or higher. - FY2025-H1First statedAnnual report
「The cap on total performance-linked compensation is ¥16.6 million. In addition, the Board of Directors decided at its meeting in July 2024 on performance-linked compensation for FY2024 as follows. Targets Performance evaluation metric Target Percentage of performance-linked compensation ① [Consolidated] ROE 6.0% or higher 30% 4.0% or higher but less than 6.0% 20% Less than 4.0% 0% ② Change in the Bank's market capitalization Not lower than the change in market capitalization for all listed regional banks 30% ③ ESG-related initiatives Qualitative assessment of progress in ESG-related initiatives 40%」
For performance-linked compensation for fiscal 2024, consolidated ROE, the rate of change in the Bank's market capitalisation and ESG-related initiatives were used as performance metrics, and the compensation allocation for each metric was set.