COMPANY

Outside Directors and Outside Auditors

Outside Directors and Outside Auditors

Mitsui Fudosan appoints its outside directors with the expectation that they will contribute their extensive experience and broad knowledge to the Company's management, and that they will play an appropriate role in strengthening the audit function of the Board of Directors and ensuring transparency. The Company also appoints its outside auditors with the expectation that they will bring an objective stance to auditing the directors in the performance of their duties, based on their expert knowledge and extensive experience. Note that, in line with Tokyo Stock Exchange requirements for judging the independence of independent officers, the Company uses the following standards for judging said independence: whether there is a risk of conflicts of interest with any of the Company's general shareholders; whether any special interests exist with the Company; and whether in working to enhance the soundness and transparency of the Company's management, the individual is capable of making objective, fair and impartial judgments.

Name Independent
Officer
Reasons for the Appointment Fiscal 2022 Attendance at Board of Directors Meetings and Board of Corporate Auditors Meetings
Managing Director Masafumi Nogimori Masafumi Nogimori has amassed a wealth of experience and broad insight having served for many years in top management positions. During meetings of the Board of Directors, he has provided many recommendations and findings regarding compliance, global business and other matters from an objective and professional viewpoint based on his broad insight concerning management. He has contributed greatly to invigorating discussions of the Board of Directors and improving its effectiveness. In addition, he plays an important role as the head of the Nomination Advisory Committee and Compensation Advisory Committee, contributing to transparency in the selection process for managing directors and corporate auditors and in the decision-making process for compensation of managing directors. As the Company's outside director, he has played an appropriate role aimed at reinforcing the supervision functions of the Board of Directors and ensuring transparency. He is expected to make further contributions going forward, and because there is no possibility of conflicts of interest with general shareholders, he has been appointed as an outside director and independent officer. 12/12
Managing Director Tsunehiro Nakayama Tsunehiro Nakayama has amassed a wealth of experience and broad insight having served for many years in top management positions. During meetings of the Board of Directors, he has provided many recommendations and findings regarding finance, risk management and other matters from an objective and specialist viewpoint based on his broad insight concerning management. He has contributed greatly to invigorating discussions of the Board of Directors and improving its effectiveness. In addition, as a member of the Nomination Advisory Committee and Compensation Advisory Committee, he has participated in discussions from an objective standpoint, contributing to ensuring transparency in the selection process for managing directors and corporate auditors and in the decision process for compensation of managing directors. As the Company's outside director, he has played an appropriate role aimed at reinforcing the supervision functions of the Board of Directors and ensuring transparency. He is expected to make further contributions going forward, and because there is no possibility of conflicts of interest with general shareholders, he has been appointed as an outside director and independent officer. 12/12
Managing Director Shinichiro Ito Shinichiro Ito has amassed a wealth of experience and broad insight having served for many years in top management positions. During meetings of the Board of Directors, he has provided many recommendations and findings regarding branding, innovation and other matters from an objective and specialist viewpoint based on his broad insight concerning management. He has contributed greatly to invigorating discussions of the Board of Directors and improving its effectiveness. In addition, as a member of the Nomination Advisory Committee and Compensation Advisory Committee, he has participated in discussions from an objective standpoint, contributing to ensuring transparency in the selection process for managing directors and corporate auditors and in the decision process for compensation of managing directors. As the Company's outside director, he has played an appropriate role aimed at reinforcing the supervision functions of the Board of Directors and ensuring transparency. He is expected to make further contributions going forward, and because there is no possibility of conflicts of interest with general shareholders, he has been appointed as an outside director and independent officer. 12/12
Managing Director Eriko Kawai Eriko Kawai has served for many years overseas where she amassed a wealth of experience and broad insight as a management consultant while working for international organizations and universities. During meetings of the Board of Directors, she has provided many recommendations and findings regarding the promotion of women's activities, ESGs, sustainability, and other matters from an objective and professional viewpoint based on her broad insight concerning management. She has contributed greatly to invigorating discussions by the Board of Directors and improving its effectiveness. In addition, as a member of the Nomination Advisory Committee and Compensation Advisory Committee, she has participated in discussions from an objective standpoint, contributing to ensuring transparency in the selection process for managing directors and in the decision process for compensation of managing directors. As the Company's outside director, she has played an appropriate role aimed at reinforcing the supervision functions of the Board of Directors and ensuring transparency. She is expected to make further contributions going forward, and because there is no possibility of conflicts of interest with general shareholders, she has been appointed as an outside director and independent officer. 12/12
Corporate Auditor Yoshitaka Kato Yoshitaka Kato is currently fulfilling appropriate roles as an outside auditor of the Company towards sufficiently realizing his function of monitoring the execution of duties by the managing directors through the use of his professional knowledge and broad experience concerning accounting and tax and expressing his opinions on the agendas as necessary. Going forward, Yoshitaka Kato is expected to make further contributions, and because there is no possibility of conflicts of interest with general shareholders, he has been appointed an outside auditor and independent officer. Board of Directors
Meetings
11/12

Board of Corporate
Auditors Meetings
12/12
Corporate Auditor Yasushi Manago Yasushi Manago is currently fulfilling appropriate roles as an outside auditor, sufficiently realizing his function of monitoring the execution of duties by the managing directors through the use of his professional knowledge and broad experience concerning finance and legislation and expressing his opinions on the agendas as necessary. Going forward, Yasushi Manago is expected to make further contributions, and because there is no possibility of conflicts of interest with general shareholders, he has been appointed an outside auditor and independent officer. Board of Directors
Meetings
12/12

Board of Corporate
Auditors Meetings
12/12
Corporate Auditor Yukimi Ozeki Yukimi Ozeki is currently fulfilling appropriate roles as an outside auditor, sufficiently realizing her function of monitoring the execution of duties by the managing directors through the use of her professional knowledge and broad experience concerning the Companies Act and expressing her opinions on the agendas as necessary. Going forward, Yukimi Ozeki is expected to make further contributions, and because there is no possibility of conflicts of interest with general shareholders, she has been appointed an outside auditor and independent officer. Board of Directors
Meetings
12/12

Board of Corporate
Auditors Meetings
12/12

Compensation for Officers and Corporate Auditors

Breakdown of Compensation

Managing directors' compensation consists of basic compensation in an amount within the scope set and approved by resolution of the 106th Ordinary General Shareholders' Meeting, bonuses paid as short-term incentives that comprehensively take into consideration such things as business results achieved in each fiscal year which must be approved by resolution at the Ordinary General Shareholders' Meeting, and restricted stock compensation paid as medium- to long-term incentives in an amount within the scope set and approved by resolution of the 108th Ordinary General Shareholders' Meeting for the purpose of sustainably increasing the corporate value of the Group and further sharing shareholder value with shareholders.
Compensation paid to managing directors (outside directors) is solely basic compensation. Compensation paid to corporate auditors will be within the scope of the total amount approved by a resolution at the 106th Ordinary General Shareholders' Meeting.
Mitsui Fudosan has established the Compensation Advisory Committee, comprised of the following 6 members: 4 independent outside directors who make up the majority and 2 internal directors, with one of these independent outside directors serving as chairman. The amount of compensation for directors is determined by the Board of Directors following consultation with the Compensation Advisory Committee. Corporate Auditor' compensation is determined based on discussions among corporate auditors.
The Board of Directors determines the details of compensation, etc. for individual managing directors for the fiscal 2020 under review pursuant to the above policy after consultations with the Compensation Advisory Committee. As a result, the details of compensation are deemed to follow the policy.

Executive Compensation Structures

Short-Term Incentives Medium- to Long-Term Incentives
Title Basic Compensation Bonus Restricted Stock Compensation
Internal directors
Internal corporate auditors - -
Outside directors and corporate auditors - -

Restricted Stock Compensation System

At the 108th Ordinary General Shareholders' Meeting held on June 26, 2020, the introduction of a restricted stock compensation system to managing directors of the Company, other than outside directors, in place of stock options was approved. Stock acquisition rights which have already been granted as stock options but have not yet been exercised will continue to exist. However, no new stock options will be granted.
Furthermore, we have also introduced a restricted stock compensation system to managing officers and Group officers who do not concurrently serve as managing directors.

Policies relating to the determination of payment ratios for performance-based compensation and other forms of compensation

Compensation for directors consists of a bonus and restricted stock compensation, which are performance-based compensation, and basic compensation, which is compensation other than performance-based compensation. The payment ratio for performance-based compensation is around 50% to 60% (around 60% to 70% for the President and Chief Executive Officer), and is around 40% to 50% (30% to 40% for the President and Chief Executive Officer) for other forms of compensation.

Indexes relating to performance-based compensation, reasons for selecting indexes for performance-based compensation, and method used to determine the amount of performance-based compensation

In regard to the bonus and restricted stock compensation – i.e. performance-based compensation –comprehensive consideration is given to factors such as performance for the current term, status of ESG-related initiatives, redistribution of profits among shareholders based on our returns policies, progress of “VISION 2025,” our Group's long-term management policies, the economic climate, and the business environment. In regard to the reasons for selecting these indexes, this is to increase the interrelationship between director compensation and performance and stockholder value. The amount of performance-based compensation is determined by the Board of Directors following consultations with the Compensation Advisory Committee, instead of leaving determination to the sole discretion of the President.

In regard to the bonus and restricted stock compensation – i.e. performance-based compensation –comprehensive consideration is given to factors such as performance for the current term, status of ESG-related initiatives, redistribution of profits among shareholders based on our returns policies, progress of “VISION 2025,” our Group's long-term management policies, the economic climate, and the business environment. In regard to the reasons for selecting these indexes, this is to increase the interrelationship between director compensation and performance and stockholder value. The amount of performance-based compensation is determined by the Board of Directors following consultations with the Compensation Advisory Committee, instead of leaving determination to the sole discretion of the President.
Executive compensation granted to managing directors and corporate auditors in fiscal 2022 was as follows.

Total Amount of Compensation for Each Executive Officer Category and Total Amount of Compensation by Type of Compensation and Number of Officers Eligible

Amount by Type of Compensation (Millions of Yen)
Executive Officer Category Total Amount of Compensation (Millions of Yen) Basic Compensation Bonus Restricted stock compensation Number of Officers Eligible (Persons)
Managing directors (excluding outside directors) 1,432 626 559 246 9
Corporate auditors (excluding outside auditors) 106 106 - - 2
Outside officers 131 131 - - 7

Notes: 1. The number of persons and the amount of compensation above include one managing director who retired at the conclusion of the 110th Ordinary General Shareholders' Meeting held on June 29, 2022.

Total Amount of Compensation of Persons with Total Compensation of 100 Million Yen or More

Amount of Compensation by Type
(Millions of Yen)
Name Executive Officer Category Company Basic Compen sation Bonus Restricted stock compen sation Total Compen sation (Millions of Yen)
Hiromichi Iwasa Chairman of the Board and Chief Executive Officer (Representative) Mitsui Fudosan Co., Ltd. 120 116 43 281
Masanobu Komoda President and Chief Executive Officer (Representative) Mitsui Fudosan Co., Ltd. 120 140 62 323
Kiyotaka Fujibayashi Managing Director Mitsui Fudosan Co., Ltd. 79 60 27 166
Yasuo Onozawa Managing Director Mitsui Fudosan Co., Ltd. 74 60 27 162
Takashi Yamamoto Managing Director Mitsui Fudosan Co., Ltd. 52 45 21 129
Managing Director Mitsui Fudosan Residential Co., Ltd. 10 - -
Takashi Ueda Managing Director Mitsui Fudosan Co., Ltd. 60 45 21 127
Takayuki Miki Managing Director Mitsui Fudosan Co., Ltd. 47 45 17 109
Wataru Hamamoto Managing Director Mitsui Fudosan Co., Ltd. 63 45 21 129

Notes: 1. Executive Officer Category is for fiscal year 2022.

Corporate Governance Report

Corporate Governance Report(768KB)