Introduction of Outside Perspectives

To reflect diverse stakeholder viewpoints in business decisions, Chugai has taken measures to obtain outside perspectives, such as nominating outside directors.

Outside Directors

Chugai has appointed outside directors to reflect a broader range of stakeholder views in management decision-making. Outside directors point out issues and give advice concerning Chugai’s management from their abundant experience and knowledge as corporate executives, physicians or university professors. The average rate of attendance by outside directors at the nine board meetings in 2020 was 100 percent.

Reasons for Election of Outside Directors
Name Independent Officer Supplementary Explanation relating to These Items Reason for Election as Outside Director
Masayuki Oku
  • Outside Director of Rengo Co., Ltd.
  • Outside Director of The Royal Hotel, Ltd.
  • Non-Executive Director of The Bank of East Asia

Until June 2011, Masayuki Oku was President and Representative Director of Sumitomo Mitsui Banking Corporation, a member of the Sumitomo Mitsui Financial Group. He was chairman of the board of Sumitomo Mitsui Financial Group until June 2017, but he has retired from both roles and is no longer involved in business execution. The Company has ordinary banking transactions with Sumitomo Mitsui Banking Corporation, such as depositing funds, but it is not a business partner that will have a significant effect on the Company’s decision-making. In light of the scale and nature of these transactions, the Company believes that there is no risk of influence over judgments by investors and shareholders.

The Company judged that he will be able to continuously execute his duties as an Outside Director appropriately through giving advice and supervising the Company about its management from his extensive experience and knowledge as a corporate manager.
The Company designated him as an independent officer based on the Company’s judgment that he meets the conditions for independence stipulated by the Tokyo Stock Exchange and Chugai’s Independence Standards for an outside officer, and that there is no risk of conflict with the interests of general shareholders.
Yoichiro Ichimaru
  • Outside Director of Seino Holdings Co., Ltd.

<No applicable relationship exists>

The Company judged that he will be able to continuously execute his duties as an Outside Director appropriately through giving advice and supervising the Company about its management from his extensive experience and knowledge as a corporate manager.
The Company designated him as an independent officer based on the Company’s judgment that he meets the conditions for independence stipulated by the Tokyo Stock Exchange and Chugai’s Independence Standards for an outside officer, and that there is no risk of conflict with the interests of general shareholders.
Mariko Y Momoi
  • Professor Emerita of Jichi Medical University
  • Visiting Professor of School of Medicine, Shinshu University
  • Regent of Tokyo Medical University (part-time)

<No applicable relationship exists>

Dr. Mariko Y Momoi has no experience in corporate management in the past. However, the Company is of the judgement that she will be able to provide appropriate advice and supervision on the management of the Company, based on her experience in managing organizations such as universities and hospitals, in addition to her extensive knowledge and experience as a physician and university professor.
The Company designated her as an independent officer based on the Company’s judgment that she meets the conditions for independence stipulated by the Tokyo Stock Exchange and Chugai’s Independence Standards for an outside officer, and that there is no risk of conflict with the interests of general shareholders.

Audit & Supervisory Board Members

Chugai has appointed outside Audit & Supervisory Board Members with the knowledge and experience to appropriately audit managerial decision-making and the execution of business.
The outside Audit & Supervisory Board Members are selected from among experts with rich knowledge and experience in accounting, law and similar fields.

Reasons for Election of Outside Audit & Supervisory Board Members
Name Independent Officer Supplementary Explanation relating to These Items Reason for Election as Outside Audit & Supervisory Board Member
Takaaki Nimura
  • Representative of Nimura Certified Public Accounting Office

The Company has no special conflict of interests with him.

The Company judged that he will be able to execute his duties as an Outside Audit & Supervisory Board Member appropriately by leveraging his abundant experience and knowledge as a corporate accounting expert (certified public accountant).
The Company designated him as an independent officer based on the Company’s judgment that he meets the conditions for independence stipulated by the Tokyo Stock Exchange and that there is no risk of conflict with the interests of general shareholders.
Yuko Maeda
  • Director of CellBank Corp.
  • Auditor of Japan Agency for Marine-Earth Science and Technology (part-time)

The Company has no special conflict of interests with her.

The Company judged that she will be able to execute her duties as an Outside Audit & Supervisory Board Member appropriately by leveraging her extensive experiences and knowledge on the application of intellectual properties of companies and academia and on collaboration between industry and academia, as well as her management experiences and audit experiences as an auditor of independent administrative corporation.
The Company designated her as an independent officer based on the Company’s judgment that she meets the conditions for independence stipulated by the Tokyo Stock Exchange and that there is no risk of conflict with the interests of general shareholders.
Kenichi Masuda
  • Partner of Anderson Mōri & Tomotsune
  • Outside Director of Bridgestone Corporation
  • Outside Corporate Auditor of LIFENET INSURANCE COMPANY
  • Outside Audit & Supervisory Board Member of Mercuria Investment Co.,Ltd.
  • Visiting Professor of School of Law, The University of Tokyo

The Company has no special conflict of interests with him.

Mr. Kenichi Masuda has no experience in corporate management in the past. However, as he has abundant knowledge and experience as an expert in corporate legal affairs (attorney-at-law), the Company is of the judgment that he will be able to execute his duties as Outside Audit & Supervisory Board Member appropriately.
The Company designated him as an independent officer based on the Company’s judgment that he meets the conditions for independence stipulated by the Tokyo Stock Exchange and that there is no risk of conflict with the interests of general shareholders.

Independent Standards

Chugai will judge outside officers (outside directors and outside Audit & Supervisory Board Members) that do not fall under any of the following to be independent officers (independent outside directors and independent outside Audit & Supervisory Board Members) with no risk of a conflict of interests with Chugai’s general shareholders:

  1. a person who is currently or has been in the past ten years an executive (see note 1) of Chugai or any of its subsidiaries (collectively, the “Chugai Group”);
  2. a person who is currently or has been in the past five years an executive of the parent company or any sister company of Chugai;
  3. a person for whom the Chugai Group is a major business partner (see note 2) or an executive of that person;
  4. a major business partner (see note 2) of the Chugai Group or an executive of that business partner;
  5. a major lender (see note 3) of the Chugai Group or an executive of that lender;
  6. a consultant, accounting professional, or legal professional who receives a large amount of money or other such assets (see note 4) other than officer remuneration from the Chugai Group (including any person belonging to a corporation, partnership, or other such organization that receives such assets);
  7. a major shareholder (see note 5) of Chugai or an executive of that shareholder;
  8. an executive of a company for which the Chugai Group is a major shareholder
  9. an executive of a company that engages a director or Audit & Supervisory Board Member (regardless of whether full or part time) from the Chugai Group or an executive of the parent company or any subsidiary of such company;
  10. a director or other executive of a corporation, partnership, or other such organization that receives contributions or aid exceeding a certain amount (see note 6) from the Chugai Group;
  11. an accounting auditor of the Chugai Group or any person belonging to an auditing corporation that is an accounting auditor of the Chugai Group; and
  12. a close relative (see note 7) of any person (limited to those in material positions (see note 8)) who falls under any of 1. through 11. above.
  • Note 1 “Executive” means an executive director, executive officer, corporate officer, or other such employee or the like.
  • Note 2 “Major business partner” means a business partner whose transactions with the Chugai Group in any business year within the past five years total 2% or more of the consolidated sales of that business partner or the Chugai Group.
  • Note 3 “Major lender” means a lender from whom the Chugai Group’s borrowings at the end of the business year exceed 2% of the Chugai Group’s consolidated total assets at the end of that business year.
  • Note 4 “Large amount of money or other such assets” means, in any business year within the past five years, money or other such assets in excess of the greater of (a) ten million yen annually or (b) 2% of the total annual income of the person receiving the money or other such assets.
  • Note 5 “Major shareholder” means a shareholder directly or indirectly holding 10% or more of total voting rights in any business year within the past five years.
  • Note 6 “Contributions or aid exceeding a certain amount” means, in any business year within the past five years, contributions or aid exceeding the greater of (a) ten 13 million yen annually or (b) 2% of the total annual income of the person receiving the contributions or aid.
  • Note 7 “Close relative” means a spouse or a relative within the second degree of kinship.
  • Note 8 “Those in material positions” means directors (excluding outside directors), corporate officers, and executive officers, or any person with authority equivalent to any of these.
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Corporate Governance

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