Executive Compensation
Officer compensation system
Details of the policy and method of determining the amount of compensation, etc. of officers or the method of calculating the amount of compensation, etc.
The compensation of Directors (excluding Directors who are Audit & Supervisory Committee Members; The same shall apply hereinafter) and Executive Corporate Officers (Senior Corporate Officer level and above) shall be divided into supervisory and executive compensation. Supervisory pay is paid monthly to Directors in cash in a fixed amount commernsurate with the responsibilities of the position. Executive compensation consists of a base salary, bonuses, and stock-based compensation and is paid to the Chairman (limited to those who are business execution Directors; the same shall apply hereinafter) and Executive Corporate Officers (the Chairman and the Executive Corporate Officers are hereinafter collectively referred to as the “Executive Business Corporate Officers”). The ratio of compensation shall be 60% basic compensation, 25% bonus, and 15% stock-based compensation, taking into consideration the need to increase incentives to improve business performance and to promote management with an awareness of shareholder value and stock price. Details are shown in the diagram below.
The determination of compensation for individual Directors and Executive Corporate Officers is left entirely up to Teruhiko Achikita, the Representative Director and Chairman, CEO, by resolution of the Board of Directors. He has the authority to determine the amount of compensation for each position and to evaluate and determine the individual performances of Executive Corporate Officers. Such decisions, however, must be approved by the Compensation Committee. In the event of any revision to the policy regarding the determination of the amount of compensation, etc. of officers or the method of calculation thereof, the details of such revisions shall be deliberated by the Committee prior to the resolution of the Board of Directors.
Remuneration for Directors who are Audit & Supervisory Committee Members is determined through consultation among the Directors who are Audit & Supervisory Committee Members.
Stock compensation system
| Target group | Directors (excluding Directors who are Audit & Supervisory Committee Members and Outside Directors) and Executive Corporate Officers (excluding individuals concurrently serving as Directors and those residing outside Japan) |
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| Applicable term | Through March 31, 2028 |
| Maximum amount to be | Total amount 300 million yen (equivalent to 100 million yen per year) |
| Method of share acquisition | By way of disposal of treasury shares or acquisition from the stock exchange market (including off-floor trading) |
| Maximum total number of points to be awarded to eligible persons | Equivalent to 40,000 points per year |
| Criteria for granting points | Points are awarded based on factors such as position and achievement of performance targets (1 point is 1 share of our company’s stock) |
| Timing of delivery of our shares | In principle, when the eligible person resigns from any of the positions of Director or Executive Corporate Officer of the Company |
Composition ratio
| Basic compensation (60/100) |
A fixed amount based on role and responsibility is paid monthly in cash. |
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| Bonus(25/100) |
The amount calculated based on both company and individual performance for the relevant business fiscal year shall be paid in lump sum in cash after the end of the relevant business fiscal year. |
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Company performance portion The payment is calculated and paid according to the achievement of the target indicator when the conditional indicator meets the pre-determined level. However, the Compensation Committee may treat the contents, level, etc., of the conditional and target indicators differently when the Compensation Committee deems it particularly necessary, such as in the event of a significant change in the management environment.
＜Conditional indicators＞ We regard the attainment of a certain level of profit and the payment of consistent dividends for each business fiscal year as the condition for the payment of bonuses; and set profit or loss attributable to owners of the parent as a conditional indicator.
＜Target indicators＞ In order to increase incentives to achieve the Nankai Group Management Vision 2027, we have set consolidated operating income, the numerical target of the Vision, as our target indicator.
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Individual performance portion The President evaluates the overall level of achievement of the goals set for each individual in each business fiscal year on a four-point scale, and the payment rate is determined based on that evaluation. If the standard amount is set at 100%, the amount paid will be either 0% or between 70% and 130%. |
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| Stock compensation （15/100） |
The trust established by the Company with monetary contributions acquires the Company’s shares through the disposal of its treasury shares or through acquisition from the stock exchange (including off-floor trading). The number of Company shares equivalent to points granted by the Company to each Executive Business Corporate Officer, based on their position during the applicable period and the degree of achievement of performance targets predetermined by the Board of Directors, shall be delivered to each Executive Business Corporate Officer through the trust. |
