Corporate Governance

Tokio Marine Holdings (the "Company") is committed to the continuous enhancement of corporate value by fulfilling its responsibilities to shareholders, customers, society, employees and other stakeholders as set forth in the "Tokio Marine Group Corporate Philosophy".
For this purpose, the Company hereby establishes a sound and transparent corporate governance system and, as a holding company, recognizes the importance of appropriate control over its Group companies and has formulated the "Tokio Marine Holdings Fundamental Corporate Governance Policy". In this Policy, the Company defines the rights of shareholders and securing fairness, and the responsibilities of the Board of Directors, etc.

Corporate Governance System

The corporate governance system of the Company is designed as a hybrid structure whereby the Nomination Committee and Compensation Committee are discretionarily established in addition to the fundamental structure of a company with an Audit & Supervisory Board. The Company believes that the above structure is optimal at this point and in light of the following measures taken: the Company determines significant business execution by resolution of the Board of Directors and makes high-quality decisions reflecting the insight of Outside Directors and Outside Audit & Supervisory Board Members; Audit & Supervisory Board Members who hold no voting rights at the Board of Directors meeting conduct unbiased and objective audits; and the transparency of the decision-making process of nomination and compensation of and for Directors, Audit & Supervisory Board Members, and Executive Officers is ensured by those issues being deliberated at the Nomination Committee and Compensation Committee.

1 The Board of Directors

The Board of Directors is responsible for deciding on important matters relating to the execution of the Company's business such as determining the Group's business plan and various basic business policies, supervising the performance of individual Directors and establishing an effective internal control system.
Directors as a general rule, at least one-third shall be Outside Directors. In addition, Directors are appointed for a term of office of one year and may be re-appointed. In order to ensure the effectiveness of the Board of Directors, it shall be a configuration that balances diversity with an appropriate size. As of the end of June 2023, the Board of Directors consists of 15 Directors, including 7 Outside Directors.

2 Audit & Supervisory Board Members and the Audit & Supervisory Board

Audit & Supervisory Board Members, as an independent body entrusted by shareholders, audit the performance of Directors, with the aim of ensuring sound and fair management and accountability. Audit & Supervisory Board Members shall endeavor to conduct a high-quality audit in accordance with the regulations of the Audit & Supervisory Board, auditing standards, auditing policies and auditing plans determined by the Audit & Supervisory Board.
Audit & Supervisory Board Members as a general rule, a majority of the Audit & Supervisory Board Members shall be outside Members. As of the end of June 2023, the Audit & Supervisory Board consists of 5 Audit & Supervisory Board Members, of whom 3 are Outside Audit & Supervisory Board Members.

3 Nomination Committee and Compensation Committee

The Company has established the Nomination Committee and the Compensation Committee, which consist mainly of Outside Directors, to raise the transparency of the processes for selecting as well as determining compensation for Directors, Audit & Supervisory Board Members and Executive Officers of the Company and principal business subsidiaries.
The Nomination Committee shall deliberate on the following matters and otherwise, and report to the Board of Directors: the appointment and dismissal of the President & Chief Executive Officer, Directors, Audit & Supervisory Board Members and Executive Officers, the criteria for the appointment and policy for the dismissal of the President & Chief Executive Officer, Directors, Audit & Supervisory Board Members and Executive Officers.
The Compensation Committee shall deliberate on the following matters and otherwise and report to the Board of Directors: Evaluation of the performance of the President & Chief Executive Officer, Directors (full-time) and Executive Officers, the compensation system and the level of compensation for the President & Chief Executive Officer, Directors and Executive Officers, policy for determination of compensation for Directors, Audit & Supervisory Board Members and Executive Officers.
As a general rule, a majority of the members of each committee are selected from outside of the Company, and the chairman of each committee is one of the outside members. The status of the members is as follows.

Nomination Committee
Chairman Shinya Katanozaka (Outside Director)
Members Emi Osono (Outside Director)
Kosei Shindo (Outside Director)
Tsuyoshi Nagano (Chairman of the Board)
Satoru Komiya (President & Chief Executive Officer)
Compensation Committee
Chairman Nobuhiro Endo (Outside Director)
Members Takashi Mitachi (Outside Director)
Robert Alan Feldman (Outside Director)
Haruka Matsuyama (Outside Director)
Satoru Komiya (President & Chief Executive Officer)

Framework Supporting the Corporate Governance System

1 Conditions for Selection of Directors and Audit & Supervisory Board Members

Directors shall have a deep understanding of the Company's business type, possess a wide range of knowledge required for management, and as a member of the Board of Directors, have the ability to make decisions that are necessary to determine significant business execution matters. Audit & Supervisory Board Members shall have operational abilities and previous achievements and experience, etc., as Audit & Supervisory Board Members, and through implementation of high quality audits, secure sound and continuous growth of the Company, contributing to the establishment of a superior corporate control system that can respond to societal trust.

2 Outside Officers

The presence of Outside Directors ensures effective supervision of director performance by the Board of Directors. In addition, Outside Directors provide advice based on their insight in various fields, thus ensuring an organization that enables appropriate decisions on important matters relating to the execution of the Company's business. The presence of Outside Audit & Supervisory Board Members creates an auditing organization with an independent and objective perspective. Moreover, it enhances the effectiveness of the Audit & Supervisory Board and ensures an organization that maintains sound, transparent management.
The Company has established conditions for selection and Standards for determining independence (Tokio Marine Holdings Fundamental Corporate Governance Policy Exhibit) when selecting Outside Officers.
As of the end of June 2023, the Company currently has 7 Outside Directors and 3 Outside Audit & Supervisory Board Members, and has determined their independence from the Company with reference to the above criteria. All 10 of the Outside Directors and Outside Audit & Supervisory Board Members are independent of the Company, and thus the Company report them to the Tokyo Stock Exchange as independent directors/audit & supervisory board members.

Name Reasons for Election Attendance of board
meetings etc.
Takashi Mitachi
(Outside Director)
As an Outside Director, he is expected to make recommendations to our Board of Directors and to play a role in exercising an appropriate supervisory function. The reason for appointing him is that he has properly fulfilled this expected role based on his insight as a specialist in business management acquired through many years of experience in a consulting firm and a management role since he was appointed as a Director of the Company. Attended all of the 10 Board of Directors' meetings held in fiscal 2022.
Nobuhiro Endo
(Outside Director)
As an Outside Director, he is expected to make recommendations to our Board of Directors and to play a role in exercising an appropriate supervisory function. The reason for appointing him is that he has properly fulfilled this expected role based on his insight as a specialist in business management acquired through many years of experience in a management role since he was appointed as a Director of the Company. Attended all of the 10 Board of Directors' meetings held in fiscal 2022.
Shinya Katanozaka
(Outside Director)
As an Outside Director, he is expected to make recommendations to our Board of Directors and to play a role in exercising an appropriate supervisory function. The reason for appointing him is that he has properly fulfilled this expected role based on his insight as a specialist in business management acquired through many years of experience in a management role since he was appointed as a Director of the Company. Attended all of the 10 Board of Directors' meetings held in fiscal 2022.
Emi Osono
(Outside Director)
As an Outside Director, she is expected to make recommendations to our Board of Directors and to play a role in exercising an appropriate supervisory function. The reason for appointing her is that she has properly fulfilled this expected role based on her insight into corporate management, acquired through many years of research into corporate strategy, etc., since she was appointed as a Director of the Company. Attended all of the 10 Board of Directors' meetings held in fiscal 2022.
Kosei Shindo
(Outside Director)
As an Outside Director, he is expected to make recommendations to Board of Directors and to play a role in exercising an appropriate supervisory function. The reason for appointing him is that, based on his insight as a specialist in business management, acquired through many years of experience in a management, we determined that he would be able to properly fulfill this expected role. -
Robert Alan Feldman
(Outside Director)
As an Outside Director, he is expected to make recommendations to Board of Directors and to play a role in exercising an appropriate supervisory function. The reason for appointing him is that, based on his insight acquired through many years of experience as an economist at financial institutions, we determined the he would be able to properly fulfill this expected role. -
Haruka Matsuyama
(Outside Director)
As an Outside Director, she is expected to make recommendations to Board of Directors and to play a role in exercising an appropriate supervisory function. The reason for appointing her is that, based on her insight regarding corporate legal affairs acquired through many years of experience as an attorney-at-law, she would be able to properly fulfill this expected role. -
Akihiro Wani
(outside audit &
supervisory board
member)
As an Outside Audit & Supervisory Board Member, he is expected to play a role in exercising an appropriate audit function. The reason for appointing him is that since he was appointed as an Audit & Supervisory Board Member of the Company, he has properly fulfilled his audit functions and provides valuable advice as a specialist in corporate legal affairs based on his insight acquired through many years of experience as an attorney-at-law. Attended all of the 10 Board of Directors' meetings and all of the 10 Audit & Supervisory Board meetings held in fiscal 2022.
Nana Otsuki
(outside audit &
supervisory board
member)
As an Outside Audit & Supervisory Board Member, she is expected to play a role in exercising an appropriate audit function. The reason for appointing her is that since she was appointed as an Audit & Supervisory Board Member of the Company, she has properly fulfilled her audit functions and provides valuable advice based on her insight which was acquired through many years of experience as an analyst in financial institutions. Attended all of the 10 Board of Directors' meetings and all of the 10 Audit & Supervisory Board meetings held in fiscal 2022.
Junko Shimizu
(outside audit &
supervisory board
member)
As an Outside Audit & Supervisory Board Member, she is expected to play a role in exercising an appropriate audit function. The reason for appointing her is that she was judged to be able to appropriately fulfill this expected role based on her many years of practical experience at financial institutions and her insight gained through research on international finance, etc. -

3 Evaluations of the Effectiveness of the Board of Directors

The Company evaluates the effectiveness of the Board of Directors every year in order to further enhance the functionality of the Board of Directors. In fiscal 2022, we conducted an evaluation of the effectiveness of the Board of Directors using a third-party organization for the first time.

(1) Methods of evaluating of the effectiveness of the Board of Directors

Third-party questionnaires and interviews were conducted with all Directors and Audit & Supervisory Board Members, and the feedback (the content of the analyses and the evaluation results, etc.) was received in a manner that ensured anonymity. Based on the content of the analyses and the evaluation results, etc., the Board of Directors deliberated on the current status of the Board of Directors and future responses. The main items of the questionnaires and interviews were as follows.

  • Roles and functions of the Board of Directors
  • Size and composition of the Board of Directors
  • Management of the Board of Directors
  • Status and topics of board discussions
  • Assessment of the Chairman and Chairman’s Status
  • Changes in institutional design
  • Response to the results of the previous year’s effectiveness evaluation
  • Composition, roles and operating status of the Nomination Committee and Compensation Committee
  • Support system for Outside Directors
  • Our Company’s governance system and the overall effectiveness of the Board of Directors
  • Self-evaluation of the performance of the Directors and Audit & Supervisory Board Members

(2) Results of evaluations of the effectiveness of the Board of Directors

The Board of Directors has received a report from the third-party organization, according to which the Board of Directors engages in sufficient discussion of many important management issues based on appropriate agenda setting and operation, the Chairman, the Internal and Outside Directors, and the Audit & Supervisory Board Members appropriately fulfill their respective roles and functions, and the Board of Directors is ensuring a high level of effectiveness; and the Board of Directors has come to the same conclusions regarding the evaluation.
As described below, the Directors and Audit & Supervisory Board Members have also provided opinions on points for further improvement to effectiveness, and there are plans to take action to address these.

Opinion 1 It should be ensured that there is sufficient time for discussion and further consideration of the topics for discussion.
Action 1 Add additional timeslots for meetings of the Board of Directors and work to secure time for discussions.
Opinion 2 It would be better to share in some more detail the matters discussed by the Nomination Committee and the Compensation Committee with the Board of Directors.
Action 2 Work to enhance the content of the reports after clarifying the content to be reported to the Board of Directors.

4 Training of Directors, Audit & Supervisory Board Members and Executive Officers

The Company provides opportunities for training, as necessary, to Directors, Audit & Supervisory Board Members and Executive Officers to allow them to appropriately fulfill duties required in each respective area.

5 Compensation for Directors, Audit & Supervisory Board Members and Executive Officers

(1) Total amount of remuneration, etc. for Directors and Audit & Supervisory Board Members

Total amount of remuneration, etc. Total amount of remuneration, etc. by type Number of persons to receive remuneration, etc.
Fixed compensation Performance linked compensation Share compensation
Directors 836 million yen 373 million yen 292 million yen 171 million yen 16 persons
Directors (excluding Outside Directors) 736 million yen 291 million yen 292 million yen 152 million yen 10 persons
Outside Directors 100 million yen 81 million yen 0 19 million yen 6 persons
Audit & Supervisory Board Members 123 million yen 123 million yen 0 0 6 persons
Audit & Supervisory Board Members (excluding Outside Audit & Supervisory Board Members) 72 million yen 72 million yen 0 0 3 persons
Outside Audit & Supervisory Board Members 51 million yen 51 million yen 0 0 3 persons
Total 959 million yen 496 million yen 292 million yen 171 million yen 22 persons
Notes:
  • 1.“Number of persons to receive remuneration, etc.” includes 2 directors who are not outside directors and 1 audit & supervisory board member who is not an outside audit & supervisory board member, who resigned from these positions on the close of the 20th Ordinary General Meeting of shareholders held on June 27, 2022.
  • 2.“Total amount of remuneration, etc.” and “Total amount of remuneration, etc. by type” include an amount paid to the 2 directors and 1 audit & supervisory board member referred to in Note 1 above.
  • 3.Share compensation includes the amount to be posted as expenses relating to points relating to share delivery trusts granted to other directors as compensation.

(2) Policy on determination of remuneration for Directors and Audit & Supervisory Board Members

The Company shall ensure "transparency," "fairness," and "objectivity" when determining compensation for Directors, Audit & Supervisory Board Members, and Executive Officers.
The following structure shall apply to compensation for Directors, Audit & Supervisory Board Members, and Executive Officers.

Applicable personnel Fixed compensation Performance-linked compensation Stock compensation
Directors (Full-Time),
Executive Officers
yes yes yes
Outside Directors,
Directors (Part-Time)
yes no yes
Audit & Supervisory Board Members yes no no
  • * With respect to the component ratios of each type of compensations within the base amount of compensation for Directors and Executive Officers, in principle, the higher their positions, the greater the ratios of performance-linked compensation and stock compensation become.

The purpose of each type of compensation is as described below.

Compensation type Purpose
Performance-linked compensation Performance-linked compensation reflects the performance of an organization or an individual against the predetermined corporate and individual targets and is introduced to strengthen individuals’ incentives to raise the Company’s corporate value.
Stock compensation Stock compensation is linked to the Company’s share price and is introduced to encourage the recipients to fulfill their accountability to shareholders by sharing returns on the Company’s shares with them.

The Board of Directors shall set the level of compensation for each position held by Directors and Executive Officers according to their responsibilities, while taking into consideration factors such as the business performance of the Company and the level of compensation in other companies.
Of the different types of compensation for Directors and Executive Officers, fixed compensation and performance-linked compensation shall be paid monthly, while stock compensation shall be delivered upon resignation.
The Board of Directors shall determine the details of compensation to individual Directors and Executive Officers and other important matters concerning compensation to Directors, Audit & Supervisory Board Members, and Executive Officers. Decisions on any matter requiring consultations with the Compensation Committee shall be made after obtaining opinions of the said Committee.

Relations with Shareholders and Other Stakeholders

1 Rights of Shareholders and Securing Fairness

The Company shall maintain an environment in which voting rights at General Meetings of Shareholders can be appropriately executed. Specific initiatives include issuing the Notice of Convocation well in advance of the meeting, scheduling the meeting on days that are not crowded with the shareholder meetings of other companies, and using a website that allows shareholders to exercise their voting rights via the Internet. In addition, the Company shall handle the exercise of voting rights and dividend payments in a fair manner, based on the type and number of shares held.

2 Dialogue with Shareholders and Investors

The Company shall establish Executive Officers in charge of business execution to conduct overall management for dialogue with shareholders and investors, and establish a dedicated department to plan and implement these activities. Toward dialogue with shareholders and investors such as earnings announcements and presentation meetings for investors the dedicated department shall work with other relevant sections to provide accurate and balanced information to shareholders and investors.
The Company, pursuant to its "Insider Trading Prevention Regulations", shall exercise the utmost care with regard to unpublicized information, and shall communicate with shareholders and investors without utilizing any significant unpublicized information.

3 Policies regarding equities held for Business-relationship

The equities held in the purpose of Business-relationship will be reduced to review the Company's risk portfolio and allocate capital to resolving social issues and to growth fields and so on.
The Company, at the meetings of its Board of Directors, confirms the appropriateness of the purposes for holding the shares of domestic listed companies that domestic insurance subsidiaries of the Company hold as business-related equities, such as strengthening medium-to-long term transaction relationships, and reviews risks and returns associated with holding such shares on an individual basis as well as the portfolio as a whole. Through these initiatives, the Company confirms the economic rationality of holding the business-related equities. The economic rationality is determined by comparing ROR (Return On Risk)* calculated from risks and returns of both insurance transactions and equity investments with the Company’s cost of capital.
At the meeting of its Board of Directors held in October 2022, the Company reviewed the economic rationality as of the end of March 2022, and confirmed that ROR of the whole portfolio is above the cost of capital. As for respective company with ROR less than the cost of capital, the Company works to improve returns from these companies through discussion regarding their business policies, and improvement and new proposals of their insurance programs.

In addition, in accordance with the standards for exercising the voting rights of business-related equities, if it is considered that a certain agenda may damage corporate value, the Company shall decide on whether to approve it through a careful examination.

4 Appropriate Cooperation with Stakeholders Other Than Shareholders

The Company shall define the "Tokio Marine Group Corporate Philosophy", and respond to the trust of shareholders through global business expansion that incorporates profitability, growth and soundness, providing safety and security to customers, and establishing a corporate environment that encourages creativity from employees. Through contributing to the development of society on a wide scale, the Company shall work to perpetually enhance its corporate value.

Appropriate Information Disclosure and Securing of Transparency

The Company shall define the "Disclosure Policy of the Tokio Marine Group", and with the aim of securing transparency and fairness in management, shall conduct appropriate and timely disclosure regarding financial information such as business results, etc., and non-financial information such as corporate philosophy and business plans.

Corporate Governance Report

The Company complies with all principles of the Corporate Governance Code (including the principles for companies listed on the Prime Market).

Record of Measures to Strengthen Corporate Governance