Corporate Governance

1. relationship with shareholders, etc.

(1) General Meeting of Shareholders

• We will position the General Meeting of Shareholders as the highest decision-making body, ensure a sufficient period for shareholders to exercise their rights, and create an environment in which shareholders can properly exercise their rights.
  • The Company shall endeavor to send out the convocation notice early enough to allow sufficient time for shareholders to consider the proposals of the General Meeting of Shareholders.
  • Prior to the dispatch of the convocation notice, the Company will post the notice on the Company's website. In addition, the Company will consider posting an English version of the Notice of Convocation in accordance with the ratio of overseas investors, etc.
  • We will introduce electronic voting via the Internet to ensure the convenience of shareholders in exercising their voting rights. We will also consider introducing an electronic voting platform in accordance with the ratio of institutional investors and overseas investors, etc.
  • If institutional investors, etc., who hold shares in the name of trust banks, etc., wish to exercise shareholder rights such as voting at the general meeting of shareholders in advance, we will consult with the trust banks, etc. In addition, if institutional investors, etc. wish to observe the General Meeting of Shareholders, they will be allowed to enter the venue of the General Meeting of Shareholders and observe the meeting after completing the prescribed procedures in advance.

(2) Ensuring shareholder rights

• In order to specifically grasp the will of shareholders at the General Meeting of Shareholders and reflect it in management and dialogue with shareholders, the Company will analyze the factors favoring or opposing all proposals after the General Meeting of Shareholders and consider whether or not a response is necessary.
• The Board of Directors makes decisions on important management matters to enable flexible decision-making and to enhance corporate value and return appropriate profits to shareholders.
• (2) With consideration for the rights of minority shareholders, the Company shall comply with laws and regulations and shall not prevent minority shareholders from exercising their rights against the Company or the Company's officers.

(3) Constructive Dialogue with Shareholders

• In order to contribute to sustainable growth and enhance corporate value, we have established a "Basic Policy on Dialogue with Shareholders" to promote constructive dialogue.

(4) Basic Policy on Capital Management

• We aim to optimize financial soundness, capital efficiency, and shareholder returns based on maintaining a sufficient level of shareholders' equity necessary to quickly and reliably seize expanding business opportunities with the aim of achieving sustainable growth in corporate value. As for shareholder return policy, the amount of dividends will be determined while taking into consideration the Company's future funding needs for capital investment, research and development expenses, etc.
• In the event of a capital procurement that would cause significant dilution, the Board of Directors will make a resolution after thorough deliberation, taking into consideration the details of the use of funds, recovery plans, and market conditions.

(5) Policy on Policy Stockholdings

• We will hold shares for the purpose of collaborating to further enhance the social value of the company and to ensure more stable corporate management in order to continuously improve corporate value.
• We will examine our policy shareholdings from a medium- to long-term perspective, taking into account their return, risk, and other factors, and will consider the purpose and rationale for holding major policy shareholdings that reflect this.
• With respect to the voting rights of policy shareholdings, we will make decisions on the exercise of such rights from the perspective of improving the medium- to long-term corporate value of the investee companies.

(6) Takeover Defense Measures

• The Company has not implemented any takeover defense measures.
• The Board of Directors will take the following actions in the event that shares are subjected to a takeover bid.
  • (i) The Board of Directors will request the tender offeror, etc. to explain the measures to enhance the corporate value of the Group.
  • The Board of Directors will consider measures to further enhance the corporate value of the Company's group, etc., and then express the Company's position on the matter to shareholders.

(7) Prevention of Related Party Transactions

• With regard to transactions with directors, corporate auditors and their close relatives, the Company shall prepare written confirmation of investigations into the existence of such transactions and report any material facts to the Board of Directors.
• Related party transactions are disclosed in accordance with the Companies Act, the Financial Instruments and Exchange Act, other applicable laws and regulations, and the rules established by the Tokyo Stock Exchange.

(8) Medium-Term Management Plan

• The Company will establish a medium-term management policy and management plan, which will be disclosed through the Company's website and other media. In addition, the Board of Directors reviews the plan as appropriate after checking and analyzing the progress.

2. relationship with customers

• Based on the corporate philosophy of "Bright Service - Bringing Brilliance to our Customers," we aim to improve customer satisfaction by achieving high quality of products and promptness of service.

3. relationship with business partners

• We shall comply with applicable laws and regulations, and strive to build mutual cooperation and trust through fair transactions based on corporate ethics.

4. relationship with society

• Based on our management philosophy, "Bright Technology: Innovative Technology for Human Society," we believe that our mission is to contribute to the sustainable development of society by solving social issues through technology, and we will pursue the realization of a better society.
• We recognize that addressing issues surrounding sustainability is an important management issue that not only reduces risk but also leads to profit opportunities, and we will respond appropriately.

5. relationship with employees

• We believe it is important to secure a diverse workforce, regardless of gender, age, nationality, etc., in order to fulfill our social responsibility as a company and achieve sustainable growth.
• With regard to the employment of women in particular, we have acquired the highest level of "Eruboshi" certification as a company with excellent efforts based on the Law for the Promotion of Women's Activities, and we will continue to improve the working environment and appoint female managers by enhancing systems such as maternity/childcare leave, shorter working hours, and teleworking.
• We have established "Bright Humanity" and "Bright Business" as our management principles, and aim to be a company that respects each and every employee, where employees with diverse values and perspectives can fully demonstrate their abilities and expertise and play an active role in the company. We aim to be a company where employees with diverse values and perspectives can fully demonstrate their abilities and expertise.
  • We believe that the growth of our employees leads directly to the growth of our company. We will strive to create an environment in which the growth of our employees and the improvement of our corporate profits grow in proportion to each other.
  • We will strive to enhance our personnel system and education/training programs so that employees can develop, improve, and demonstrate their abilities.
  • We will strive to provide opportunities for employees to demonstrate their abilities and motivation and to be active on a global scale.
  • We will comply with labor-related laws and regulations, and strive to ensure a safe and comfortable work environment that is health-conscious and free from activities that place excessive physical and mental burdens on employees, long working hours, and overtime work.
  • The Company has established a whistle-blowing office independent of management, which accepts reports of acts that violate or may violate employment regulations, laws, and ordinances, and will maintain the confidentiality of such reports and will not treat them disadvantageously, while striving to resolve issues as early as possible.

1. institutional design

Since immediately after listing on the Tokyo Stock Exchange, our Board of Directors has consisted of several outside directors (including independent outside directors, hereinafter the same) in addition to executive directors, in an effort to ensure fairness and transparency in management. Therefore, we have chosen to remain a company with a board of corporate auditors as our organizational design under the Companies Act, and will continue to ensure fairness and transparency by supervising management through both the board of directors and the board of corporate auditors. 2.

2. Board of Directors

(1) Roles and Responsibilities of the Board of Directors

• The Board of Directors of Minebea is responsible for formulating and revising the Company's philosophy, disseminating the Company's philosophy widely among Minebea Group employees in Japan and overseas, and verifying, as appropriate, that the Company's philosophy is always respected within the Minebea Group and is used as a standard of conduct for Minebea employees.
• Recognizing that Minebea is a global company with subsidiaries in Japan and overseas, the Board of Directors is responsible for establishing a system to ensure that the management of Minebea's subsidiaries is conducted legally and appropriately, and that management matters are shared with Minebea, and for continuously enhancing and strengthening this system.
• Recognizing that its primary role and responsibility is to provide strategic direction to the Company as the final decision-making body regarding the execution of important business operations of the Company, the Board of Directors of the Company shall engage in constructive and fair deliberations on specific management strategies, management plans, etc., in order to fully fulfill its accountability to stakeholders, We make decisions based on strategic direction.
• The Board of Directors considers it one of its major roles and responsibilities to create an environment that supports appropriate risk-taking by the Company's executive directors, and while welcoming proposals from executive directors based on sound entrepreneurial spirit, the Board of Directors will fully consider such proposals from an independent and objective standpoint from multiple perspectives in order to ensure accountability. We will also respect the prompt and decisive decision-making of the executive directors when implementing the approved proposals.
• The Board of Directors delegates to the President and Representative Director the execution of matters approved by the Board of Directors as important business operations of the Company, as well as other matters that arise in the course of daily business operations. Based on the delegation by the Board of Directors, the President and Representative Director of the Company executes the business by delegating it to the decision makers as defined in the Regulations on Decision-making Authority, depending on the size of the risk of the matter in question.
• The Company has adopted an executive officer system in order to enhance and improve the efficiency of the directors' business execution system. Executive officers, who directly direct and supervise domestic and overseas companies and divisions of the Group, are appointed by the Board of Directors and carry out their responsibilities as determined by the Board of Directors. The Board of Directors, upon recommendation from the President and Representative Director, selects Executive Officers and nominates candidates for Directors and Corporate Auditors by identifying the skills and other attributes that they should possess in light of the management strategy. The decision will be made in a manner that balances diversity, including gender, internationality, work experience, and age, with an appropriate size. In making the decision, the Company may request the Target Company's attendance at a meeting of the Board of Directors. In addition, a skills matrix listing the knowledge, experience, and abilities of each director (candidate) will be disclosed in the notice convening the general meeting of shareholders.
• The Company's Board of Directors will appropriately evaluate the Company's performance, etc., and reflect such evaluation in personnel matters, including the appointment and dismissal of executive directors and corporate officers, through fair and transparent procedures, such as deliberation by the Board of Directors.
• The Company's Board of Directors shall explain the reasons for the nomination of directors and corporate auditors in the business report.
• The Company has established a decision-making policy concerning individual remuneration, etc. of directors, and the Board of Directors is consulted on the method of determining remuneration, etc. for each individual director, which is prepared within the limit of remuneration resolved at the General Meeting of Shareholders and based on an appropriate level in consideration of each position, and the opinions of independent outside directors and outside corporate auditors on the proposed remuneration are fully respected in determining the details of the remuneration, etc. The Board of Directors makes decisions with due respect for the opinions of independent outside directors and outside corporate auditors on compensation proposals.
• The remuneration system shall be linked to shareholder interests so that it fully functions as an incentive to sustainably increase corporate value. In determining the remuneration of individual directors, the Company will set an appropriate level based on their respective responsibilities after comparing and examining the remuneration data for directors and executive officers from external research institutions, etc. The remuneration for executive directors will consist of fixed remuneration, performance-linked remuneration, etc., and non-monetary remuneration, etc. Outside directors, who are responsible for the supervisory function, shall receive only fixed remuneration in consideration of their duties.
• The Board of Directors of the Company entrusts the President and Representative Director to determine the remuneration of each Director, and does not introduce performance-linked remuneration or grant shares of the Company's stock. However, in order to prevent the remuneration from becoming a handout, if the outside Director, full-time Corporate Auditor, or the Board of Corporate Auditors points out or advises that the remuneration is inappropriate, the Board of Directors may, based on such advice or suggestion, change the remuneration system at any time. To prevent any such overburdening, the Company has established a system to review remuneration at any time based on such advice or suggestion.
• The Board of Directors of the Company shall establish a system to respond to any problems identified by the corporate auditors or the independent auditors.
• The Company's Board of Directors closely monitors and appropriately supervises the development of the Company's human resources and the training of future management executives.

(2) Composition of the Board of Directors

• The Board of Directors consists of one or more executive directors and several outside directors.

(3) Internal Control System

• In order to ensure that business is executed promptly under appropriate control, our Board of Directors shall establish a basic policy for the development of internal control systems, and while utilizing the Internal Audit Department for the operation of such systems, as a global company, shall supervise the status of development and operation of our company and our subsidiaries in Japan and overseas.

(4) Implementation and disclosure of analysis and evaluation of the effectiveness of the Board of Directors

• Our Board of Directors makes important management decisions through active discussions and deliberations, including those by outside directors and outside corporate auditors, and strives to demonstrate its effectiveness. The Company will consider disclosing the results of analysis and evaluation of the effectiveness of the Board of Directors as a whole as necessary in the future.

3) Board of Corporate Auditors

• In fulfilling its role in auditing the execution of duties by directors, selecting and dismissing external accounting auditors, and exercising authority over audit fees, the Board of Corporate Auditors is keenly aware that it has been entrusted by shareholders and other stakeholders to supervise overall management, and is responsible for making appropriate judgments from an independent and objective standpoint. The Board of Corporate Auditors is responsible for making appropriate judgments from an independent and objective standpoint.
• The Board of Corporate Auditors of the Company shall endeavor to establish a system to ensure the effectiveness of audits.
• The Board of Corporate Auditors shall work with the Internal Audit Department to exchange opinions and information as necessary to improve the effectiveness of audits.
• The Board of Corporate Auditors provides information obtained through its audit activities to the outside directors.
• The Board of Corporate Auditors shall take the following actions to ensure proper audits by the Accounting Auditor.
  • (i) The Board of Corporate Auditors of the Company shall ensure a system that enables the Accounting Auditor to conduct sufficient and appropriate audits in order to conduct high-quality audits.
  • The Board of Corporate Auditors of the Company shall formulate evaluation standards and appointment criteria to properly evaluate the accounting auditors and confirm their independence and professionalism.
  • The Board of Corporate Auditors shall request explanations from the Accounting Auditor as to whether the Accounting Auditor complies with the standards of quality control necessary for the proper performance of accounting audits.
  • The Board of Corporate Auditors of the Company shall establish a response system in the event that the accounting auditors discover any irregularities and request appropriate action or point out any deficiencies or problems.
  • The Board of Corporate Auditors of the Company shall, as appropriate, hold meetings with the accounting auditors, the President and CEO of the Company, and the director in charge of financial affairs of the Company.
  • The Board of Corporate Auditors of the Company shall hold meetings with the accounting auditors on a regular basis.

Directors and Corporate Auditors

(1) Executive Directors

• As members of the Company's Board of Directors, our executive directors understand the responsibilities of the Board of Directors and perform their duties as directors for the common interests of the Company and its shareholders, while ensuring appropriate collaboration with stakeholders.
• The executive directors of the Company shall always practice the Company's philosophy and motto, have a high sense of legal compliance, moral awareness, and ethics, and execute their duties without forgetting to maintain a fair and bird's-eye viewpoint.
• The executive directors of the Company shall not fail to collect information necessary for the execution of their duties.
• Our executive directors recognize that the performance forecast we announce is one of the commitments we make to our shareholders, and we will make our best efforts to achieve it. If we fail to meet our targets, we will fully analyze the causes of the failure and the actions we have taken, provide an explanation to shareholders, and reflect this analysis in our plans for subsequent periods.
• The Company's executive directors will constantly strive to improve themselves in order to properly fulfill their roles and responsibilities.

(2) Outside Directors

• As members of the Board of Directors, the outside directors of the Company shall supervise the execution of business by the executive directors in particular, and shall, while ensuring appropriate collaboration with stakeholders, promote the sustainable growth of the Company and the common interests of shareholders, based on their own knowledge of improving profitability and capital efficiency, etc., in order to enhance the medium- and long-term corporate value of the Company. They are responsible for providing advice to the executive directors and reflecting the opinions of the Board of Corporate Auditors and stakeholders in the proceedings of the Board of Directors, with a view to promoting the sustainable growth of the Company and enhancing its corporate value over the medium and long term, based on their knowledge of improving profitability and capital efficiency, etc. for the common interests of the Company and its shareholders.
• The Company's outside directors regularly meet with other outside directors and the Board of Corporate Auditors to exchange information on the Company's management.
• In order to fulfill their responsibilities, the Company's outside directors may request information from the Company at any time as necessary.
• The criteria for determining the independence of independent outside directors are in accordance with the standards set forth by the Tokyo Stock Exchange.
• The Company's outside directors constantly strive to improve themselves in order to properly fulfill their roles and responsibilities.

(3) Corporate Auditors

• As members of the Board of Corporate Auditors of the Company, our Corporate Auditors understand the responsibilities of the Board of Corporate Auditors of the Company and perform their duties as Corporate Auditors for the common interests of the Company and its shareholders, while ensuring appropriate collaboration with stakeholders.
• Our corporate auditors possess the necessary legal, financial, accounting and management expertise, as well as a high level of legal compliance, moral and ethical awareness, to ensure that they perform their duties from a fair and objective perspective.
• Our corporate auditors conduct operational and accounting audits in accordance with laws and regulations, and in order to fulfill their role, they actively and positively exercise their authority and express their opinions at meetings of the Board of Directors or to individual directors.
• The Company's corporate auditors shall audit the legality and appropriateness of the execution of duties by the directors and the performance of their supervisory duties by the Board of Directors.
• The Company's corporate auditors audit the performance of duties by the directors and exercise their authority in relation to the selection and dismissal of the accounting auditor and audit fees.
• Our corporate auditors monitor and verify the decision-making of the Board of Directors and the establishment and operation of the internal control system.
• The Company's Corporate Auditors will constantly strive to improve themselves in order to properly fulfill their roles and responsibilities.

(4) Full-time Corporate Auditors

• Among the Company's Corporate Auditors, the full-time Corporate Auditor, based on his/her characteristics as a full-time person, will actively strive to improve the audit environment, including exercising the authority to conduct investigations as required by law, and collect information within the Company by attending important internal meetings such as the Management Committee and by visiting domestic and overseas subsidiaries.
• The Company's full-time corporate auditor will share information obtained in the course of performing his/her duties with other corporate auditors.

(5) Outside Corporate Auditors

• Outside Corporate Auditors are in a position of relatively high independence, and therefore provide the Board of Directors with more fair and appropriate opinions.
• The Company's external auditors independently exercise their statutory authority to investigate and gather information from within the Company.

(6) Support System

• The Company has established a Board of Directors Secretariat and operates it as follows to enable directors and corporate auditors to engage in full discussion at meetings of the Board of Directors.
• (i) An annual schedule of Board of Directors meetings shall be prepared prior to the start of the fiscal year to ensure that the Board of Directors meetings are well attended.
• (2) Appropriate materials and facilities shall be prepared to enable sufficient discussion at Board of Directors meetings.
• When a resolution requires approval of a considerable amount of documents, materials related to the matters to be discussed will be distributed at least a reasonable number of days prior to the date of the Board of Directors' meeting.
• Not limited to the above, the Board of Directors Secretariat will provide information necessary for directors and corporate auditors to make decisions as appropriate.
• Each department of the Company shall proactively support Directors and Corporate Auditors by appointing a person in charge or otherwise, when they are requested to provide information necessary for deliberations at the Board of Directors meetings.
• The Company shall set up regular opportunities for the Internal Audit Department and Directors and Corporate Auditors to exchange information with each other.
• When requested by Directors and Corporate Auditors, the Company will bear the costs of obtaining advice from outside experts.

(7) Training Policy

• The Company will provide training and information as necessary for directors and corporate auditors to properly fulfill their roles and responsibilities.
• As necessary, the Company will provide lectures and training on the Company's business, management philosophy, management policies, laws, accounting, and corporate governance.
• The Board of Directors will provide monthly opportunities to explain the progress of the Company's business and business issues.