Board Composition

Nomination and Remuneration Advisory Committee — Involvement of Independent External Directors

We have established the Nomination and Remuneration Advisory Committee as a voluntary committee to ensure transparency and objectivity in matters relating to the nomination policy and the appointment and dismissal of Directors as well as in decisions on the remuneration system and the amount of remuneration received by Directors (excluding those who serve as member of the Audit and Supervisory Committee). The majority of the member of the Nomination and Remuneration Advisory Committee are Independent External Directors who are appropriately involved in the decision-making process of the Board of Directors, a process through which their opinions are reflected.

Policy and Procedures for Nominating Directors

Individuals with proven ability and experience in corporate management, as well as excellent character and insight, are appointed as candidates for Directorship. In addition to these qualities, each candidate for External Director must also meet EIZO’s Criteria for Independence of External Directors and be capable of auditing and supervising company management and operations from a variety of perspectives. In accordance with the above policy, the Board of Directors decides on the candidates after deliberating with and receiving the recommendations of the Nomination and Remuneration Advisory Committee. The approval of the Audit and Supervisory Committee is obtained for the nomination of Director candidates who are member of the Audit and Supervisory Committee. The composition of the Board of Directors reflects our consideration of the size and nature of the business to ensure that the Board of Directors is optimally suited to the company and that the Board of Directors as a whole reflects a balance and diversity of knowledge, experience, and skills. We appointed our first female Director in FY2022 and our first non-Japanese Director in FY2023. In addition, the Nomination and Remuneration Advisory Committee regularly discusses the CEO succession plan and future management structure.

[Reasons for the election of the candidate for Director

Criteria for Independence of External Directors

1. The Company’s Board of Directors shall deem an External Director or a candidate for External Director of the Company to have independence in the event that he/she does not fall under any of the items below in the current fiscal year and in the previous three (3) fiscal years.
   1. (1) A person executing business operations (*) of EIZO Group’s business partner, its parent company, or important subsidiary whose transaction amount exceeds two (2) % of the consolidated net sales of EIZO Group or the business partner.
   2. (2) A person executing business operations of a financial institution or other lenders, or its parent company or important subsidiary which is indispensable for EIZO Group’s financing and on which the Group depends to the extent that there is no substitute.
   3. (3) A consultant, accounting professional, or legal professional who has received from EIZO Group monetary consideration or other properties equivalent to ten (10) million yen or more during a year, excluding officers’ remuneration (in case a corporation, association, or other organization receives such properties, a person who belongs to such organization).
   4. (4) A person executing business operations of a major shareholder of the Company (who holds ten (10) % or more of the voting rights of the Company directly or indirectly) or its parent company or important subsidiary.
   5. (5) A representative partner, certified public accountant, partner, or employee of the audit firm that is the current Accounting Auditor of EIZO Group. Or, a person who has belonged to the audit firm that was the Accounting Auditor of EIZO Group during the previous three (3) fiscal years and was engaged in actual auditing work on EIZO Group.
   6. (6) A person executing business operations or a Corporate Auditor of a company, or its parent company or subsidiary that accepts Directors from EIZO Group.
   7. (7) A person who has received a donation of ten (10) million yen or more during a year from EIZO Group (in case a corporation, association, or other organization receives such donation, a Director of such an organization or a person directly involved in research, education, or other activities related to such a donation).
   8. (8) A spouse or relative within the second degree of kinship of a person executing business operations who falls under any of (1) to (7) above.
   9. (9) Notwithstanding the foregoing, any other person who has special grounds that could give rise to a conflict of interests with the Company or its general shareholders, preventing him/her from fulfilling duties as an Independent External Director.

   (*) A person executing business operations means a Director (excluding an External Director), corporate officer, operating officer or other similar person, or employee.

2. In case an External Director ceases to have the independence stipulated in the Criteria, he/she shall notify the Company immediately.
3. Amendments to the Criteria shall be resolved by the Board of Directors.