Governance Corporate Governance

Evaluations of the Board of Directors’ Effectiveness

To further enhance corporate governance by ascertaining the characteristics, strengths, and challenges of the Board of Directors, we conduct effectiveness evaluations of the Board using an external organization.

Survey Themes and Results in FY2023

① A “questionnaire related to the Board of Directors evaluation” was submitted to all directors and auditors in February 2024.
② Responses were compiled from an objective standpoint by an external organization. Based on the results of this organization’s compilation and analysis, the Board of Directors analyzed and assessed the information in May 2024.

〈Survey Themes〉
① The role and function of the Board of Directors
② The composition and size of the Board of Directors
③ The operation of the Board of Directors
④ Liaison with audit functions
⑤ Provision of opportunities for outside directors
⑥ Relationship with shareholders and investors
⑦ Summary

〈Survey Results〉
The Board was determined to have two strengths. First, the composition, operation, and deliberations of the Board of Directors are generally appropriate, and necessary and sufficient discussions are conducted, including sharing the ideal form of the board of directors of a holding company and conducting appropriate monitoring. Second, the Board of Directors as a whole, including outside officers, has diverse skills, expertise, and diverse backgrounds, and the system is designed to ensure appropriate decision-making through active discussion.

Major Areas Requiring Improvements Identified in the FY2023 Survey and Planned Improvement Measures

Based on the results of the fiscal 2023 evaluation survey and analysis, three areas requiring improvement (indicated in the table below) were identified. The Company plans to implement improvement measures in these areas.

Major Areas Requiring Improvement Major Improvement Measures (Planned)
Enhancing further discussions on medium- to long-term issues at Board of Directors meetings Regarding medium- to long-term issues, we will thoroughly examine the need for deliberation and the key points to be deliberated. Based on this analysis, we will create an agenda plan for future meetings and report it to the Board of Directors. We will incorporate the opinions of directors and auditors and subsequently operate according to the agenda plan.
Creating opportunities for outside directors to learn more about the realities of the business We will consider and implement opportunities to help our outside directors to become more familiar with actual business operations through participation in the activities of operating companies.
Clarifying discussion points and appropriate explanations on resolution items To clarify discussion points, we will consider improving the structure and presentation of the materials presented by referring to good examples of how agenda items and reports are handled at Board meetings.

In addition, the Company recognizes that providing appropriate information to the Board of Directors regarding succession plans and ensuring a more diverse Board of Directors are issues that must be addressed over the medium term to further enhance the effectiveness of the Board of Directors. Based on the results of evaluation, the Company’s Board of Directors will continue its efforts to further improve its effectiveness.