Composition, etc., of the Board of Directors (as of May 31, 2022)

Last update: June 9, 2022

Composition, etc., of the Board of Directors

1. Composition of the Board of Directors (balance among knowledge, experience, and skills, and diversity and size, of the Board of Directors) and reasons for selection as Director [CGC Principle 3.1 (v)][CGC Supplementary Principle 4.11.1, 2]Updated

The Company emphasizes the composition of Directors and Audit & Supervisory Board Members for the Board of Directors having a good overall balance of knowledge, experience, and skills to effectively perform the role and responsibilities of the Board and ensuring both diversity and an appropriate size.
  In particular, as a holding company, the Company needs to conduct comprehensive and multifaceted management for diverse business domains. Therefore, the Company examines the Board composition, considering diversity (including career and age) in terms of female and non-Japanese Directors and Audit & Supervisory Board Members as well as the balance among their knowledge, experience, and skills. For the Company's Audit & Supervisory Board Members, the Company takes care to appoint such persons with appropriate knowledge of finance and accounting.
  The Company stipulates the aforementioned policies in the "Guidelines for Directors and Audit & Supervisory Board Members" (See "Guidelines for Directors and Audit & Supervisory Board Members").

Composition, etc., of the Board of Directors for FY2023

The Company has decided the candidates to form its Board of Directors for FY2023 in order to achieve the objective of becoming a world-class global retailer group and to enhance the Company’s mid- to- long-term corporate value, a goal announced in the Medium-Term Management Plan 2021-2025 released in July 2021.
 The Company has also intensively engaged in constructive discussions with domestic and overseas institutional investors and shareholders in order to globalize its businesses and implement reforms in consideration of the voices from capital markets. Based on the input obtained in that process, the Company has been seriously reviewing its board structure and what additional experience and skills are required.
 As a result, the Company has made the following decisions.

  • (1) A majority of the Board of Directors will be Independent Outside Directors in order to ensure the effectiveness of its supervisory function.
  • (2) Six (6) candidates (three (3) female and four (4) non-Japanese nominees) will be nominated to newly assume the office of Independent Outside Directors by taking into account diversity in the form of females, non-Japanese individuals and the like (including work experience and age). This reflects a higher focus being placed on the experience and skills required of newly-appointed Outside Directors, such as: experience in corporate management, experience in retail business, experience in overseas businesses, and knowledge of capital markets. This will result in a total of nine (9) Independent Outside Directors, including re-appointees, help the Company secure diversity in knowledge, experience and capabilities, and make the Company’s system better suited to pursue its global growth strategy.
  • (3) Internal Directors will be reduced by two (2) to a total of six (6) in order to strike a balance between business management and supervisory function and to ensure agile decision-making.

   With the above lineup of diverse members, the Company’s Board of Directors will duly perform its roles and duties as the Board of Directors through important decision-making underpinning expeditious and adamant risk taking, as well as highly effective supervision.

Establishment of Lead Independent Outside Director

Because a majority of the members of the Board of Directors are Outside Directors with diverse experience and skills, the Company has established the position of Lead Independent Outside Director on May 26, 2022. To fulfill the following roles, the Company ensures a more effective oversight function of the Board of Directors.

Roles of the Lead Independent Outside Director

  • (1) Ensure mutual coordination and follow-up among Outside Directors.
  • (2) Further enhance and maintain dialogue and communication between Outside Directors and senior management.
  • (3) Strengthen coordination between Outside Directors and the Audit & Supervisory Board.
  • (4) Promote “constructive dialogue with shareholders and investors” in which Outside Directors participate.
Appointment of Audit & Supervisory Board Members with expertise with regard to finance and accounting

The Company has appointed the following three Audit & Supervisory Board Members who have expertise with regard to finance and accounting.

  • Standing Audit & Supervisory Board Member Nobutomo Teshima was engaged in operations relating to accounting in the accounting management division in the Company and SEVEN-ELEVEN JAPAN CO., LTD. for a total period of 20 years or more.
  • Audit & Supervisory Board Member Kazuhiro Hara is a certified public accountant and certified tax accountant.
  • Audit & Supervisory Board Member Kaori Matsuhashi is a certified public accountant.
Major management and industry experience, management skills, knowledge, etc. of Directors and Audit & Supervisory Board Members
Name Title Management and Industry Experience Management Skills, Knowledge, etc.
CEO Experience Retail Experience International Business Experience Financial Business Experience Organizational Management Marketing/Branding DX/IT/Security Finance and Accounting Risk Management/Crisis Response/Legal Sustainability
Ryuichi Isaka Representative Director and President
Katsuhiro Goto Representative Director and Vice President
Junro Ito Director
Yoshimichi Maruyama Director
Fumihiko Nagamatsu Director
Joseph M. DePinto Director
Kunio Ito Lead Independent Outside Director
Toshiro Yonemura Independent Outside Director
Tetsuro Higashi Independent Outside Director
Yoshiyuki Izawa Independent Outside Director
Meyumi Yamada Independent Outside Director
Jenifer Simms Rogers Independent Outside Director
Paul Yonamine Independent Outside Director
Stephen Hayes Dacus Independent Outside Director
Elizabeth Miin Meyerdirk Independent Outside Director
Noriyuki Habano Standing Audit & Supervisory Board Member
Nobutomo Teshima Standing Audit & Supervisory Board Member
Kazuhiro Hara Independent Outside Audit & Supervisory Board Member
Mitsuko Inamasu Independent Outside Audit & Supervisory Board Member
Kaori Matsuhashi Independent Outside Audit & Supervisory Board Member
*The above table is not an exhaustive list of the knowledge and experience each person can offer.
Director (Internal)
Name
(date of birth)
Area of Responsibility in the Company and Important Concurrent Positions Attendance at Meetings Reasons for Selection
(experience and knowledge)
Ryuichi Isaka
Ryuichi Isaka
(October 4, 1957)
Member of the Nomination Committee
Representative Director and President
Director of 7-Eleven, Inc.
Board of Directors*1
16/16

Nomination Committee*2
7/7
He has overseas business experience and broad knowledge of the retailing industry cultivated as a president of a Group company and a director of the Company as well as broad knowledge and experience in company management including the franchise business, marketing, and management administration, as well as sustainability (addressing environmental and social issues and so forth). The Company would like him to utilize this knowledge and experience to realize the management plans aimed for by the Company, and to maximize the Group's corporate value through the generation of new business and through activation of our existing business by means of using the collective capabilities of the retail group, which has various business categories.
Katsuhiro Goto
Katsuhiro Goto
(December 20, 1953)
Member of the Nomination Committee
Representative Director and Vice President
Information Management Supervisor
Director of SEVEN-ELEVEN JAPAN CO., LTD.
Director of Seven Bank, Ltd.
Board of Directors*1
16/16

Nomination Committee*2
7/7
He has broad knowledge of the retailing and financial industries cultivated as a director of the Company and its Group companies including a finance related subsidiary as well as broad knowledge and experience in areas including advertising and branding, management administration, risk management, and so forth. The Company would like him to utilize this knowledge and experience to realize the management plans aimed for by the Company, and to advance Group function (strengthening the provision of high value added services and the function of administrative divisions).
Junro Ito
Junro Ito
(June 14, 1958)
Member of the Compensation Committee
Director and Managing Executive Officer
General Manager of the Corporate Development Division
Outside Director of AIN HOLDINGS INC.
Representative Director of Ito-Kogyo Co., Ltd.
Board of Directors*1
16/16

Compensation Committee*3
3/3
He has overseas business experience and broad knowledge of the retailing industry cultivated as a director of the Company and its Group companies as well as broad knowledge and experience in ESG (Environment, Social, Governance), risk management, accounting and finance, social marketing, and so forth. The Company would like him to utilize this knowledge and experience to realize the management plans aimed for by the Company, to enhance its corporate value including non-financial aspects, and to smoothly execute group management.
Yoshimichi Maruyama
Yoshimichi Maruyama
(November 2, 1959)
Member of the Compensation Committee
Director and Managing Executive Officer
General Manager of the Corporate Finance & Accounting Division
Representative Director and President of Seven & i Financial Center Co., Ltd.
Director of 7-Eleven, Inc.
Board of Directors*1
16/16
He has business experience in a financial institution and broad knowledge relating to the Group's overall operations cultivated as a senior officer in the risk management division of the Company and the finance division of the Company as well as broad knowledge and experience relating to risk management, finance and accounting, and so forth. The Company would like him to utilize this knowledge and experience to realize the management plans aimed for by the Company, to stabilize the Group's financial base, and to strengthen financial discipline.
Fumihiko Nagamatsu
Fumihiko Nagamatsu
(January 3, 1957)
Director
Representative Director and President of SEVEN-ELEVEN JAPAN CO., LTD.
Director of 7-Eleven, Inc.
Board of Directors*1
16/16
He has broad knowledge of the retailing industry cultivated as a president of a Group company and a director of the Company as well as broad knowledge and experience relating to company management including the franchise business, management administration, personnel management, etc. The Company would like him to utilize this knowledge and experience to realize the management plans aimed for by the Company, to advance Group functions, and to pursue Group synergies.
Joseph M. DePinto
Joseph M. DePinto
(November 3, 1962)
Director
Director and President and Chief Executive Officer (CEO) of 7-Eleven, Inc.
Chairman of the Board of Brinker International, Inc. (Non-Executive)
Director of DHC Acquisition Corp. (Non-Executive)
Board of Directors*1
16/16
He has broad knowledge of the international retailing business cultivated as a president of our American Group company and as a director of the Company as well as broad knowledge and experience relating to company management, the franchise business, management administration, marketing and so forth. The Company would like him to utilize this knowledge and experience to realize the management plans aimed for by the Company, to provide advice to the Company's Board of Directors from an international perspective, and to promote global management of the Company.
*1 Attendance at meetings of the Board of Directors held in the 17th fiscal year (from March 1, 2021 to February 28, 2022) (The same applies to the following.)
*2 Attendance at meetings of the Nomination Committee held in the 17th fiscal year (from March 1, 2021 to February 28, 2022) (The same applies to the following.)
*3 Attendance at meetings of the Compensation Committee held in the 17th fiscal year (from March 1, 2021 to February 28, 2022) (The same applies to the following.)
Director (Outside)
Name
(date of birth)
Area of Responsibility in the Company and Important Concurrent Positions Attendance at Meetings Reasons for Selection
(experience and knowledge)
Kunio Ito
Kunio Ito
(December 13, 1951)
Chair of the Nomination Committee
Member of the Compensation Committee
Lead Independent Outside Director
Director of Hitotsubashi CFO Education and Research Center
Outside Director of KOBAYASHI PHARMACEUTICAL CO., LTD.
Outside Director of Toray Industries, Inc.
Board of Directors*1
16/16

Nomination Committee*2
7/7

Compensation Committee*3
3/3
He has broad high level knowledge and experience regarding finance and accounting, economics including marketing and branding, ESG (Environment, Society, Governance), risk management, etc. cultivated through his long term work experience as a university professor and his abundant experience as an outside executive of other companies. The Company would like him to utilize this knowledge and experience to realize the management plans aimed for by the Company, and to further improve the effectiveness of the Company's management and the Board of Directors.
Toshiro Yonemura
Toshiro Yonemura
(April 26, 1951)
Member of the Nomination Committee
Independent Outside Director
Outside Director of Kansaidengyosha Co., Ltd.
Board of Directors*1
16/16

Nomination Committee*2
7/7
He has held such important positions as Superintendent General of the Tokyo Metropolitan Police Department and Deputy Chief Cabinet Secretary for Crisis Management, has held positions such as Chief Security Officer (CSO) of the Tokyo Organising Committee of the Olympic and Paralympic Games, and has broad high level knowledge and experience regarding organizational management, risk management, etc. The Company would like him to utilize this knowledge and experience to realize the management plans aimed for by the Company, and to further improve risk management and the effectiveness of the Company's management and the Board of Directors.
Tetsuro Higashi
Tetsuro Higashi
(August 28, 1949)
Chair of the Compensation Committee
Independent Outside Director
Outside Director of UBE Corporation
External Director of Nomura Real Estate Holdings, Inc.
Board of Directors*1
15/16

Compensation Committee*3
3/3
He has business experience overseas, has held such important positions as Representative Director, Chairman and President, etc. of Tokyo Electron Limited, and has broad high level knowledge and experience regarding international corporate management, management administration, finance, accounting, etc. The Company would like him to utilize this knowledge and experience to realize the management plans aimed for by the Company, and to further improve the effectiveness of the Company's management and the Board of Directors.
Yoshiyuki Izawa
Yoshiyuki Izawa
(February 10, 1948)
Independent Outside Director
Outside Director, Member of the Audit and Supervisory Committee of Nitori Holdings Co., Ltd.
He has abundant overseas experience and a broad range of high level knowledge in international corporate management, business administration, finance and capital markets, as well as his experience as an investor, having served as a Representative Director of a trading company and a financial institution, and has served such important positions as Chairman & CEO, Representative Director of BlackRock Japan Co., Ltd. The Company would like him to utilize this knowledge and experience to realize our sustainable growth and to further improve the effectiveness of our management and the Board of Directors.
Meyumi Yamada
Meyumi Yamada
(August 30, 1972)
Member of the Nomination Committee
Independent Outside Director
Director of istyle Inc.
Outside Director of JAPAN POST INSURANCE Co., Ltd.
Outside Director of SEINO HOLDINGS CO., LTD.
Outside Director of Sompo Holdings, Inc.
She has a broad range of high level knowledge and experience in EC (e-commerce), DX (digital transformation), organizational management, marketing, sustainability, among others, which she has cultivated through the operation of “@cosme,” one of Japan’s largest cosmetics and beauty portal sites, and through starting up a women’s skill development and job hunting support business. The Company would like her to utilize this knowledge and experience to realize our management plans and to further improve the effectiveness of our management and the Board of Directors.
Jenifer Simms Rogers
Jenifer Simms Rogers
(June 22, 1963)
Member of the Compensation Committee
Independent Outside Director
Vice President & General Counsel Asia of Asurion LLC
External Director of Mitsui & Co., Ltd.
Outside Director of Kawasaki Heavy Industries, Ltd.
Outside Director of Nissan Motor Co., Ltd.
She has experience working for international financial institutions as an In-House Counsel, as well as extensive experience as President of the American Chamber of Commerce in Japan and as an Outside Director at other companies, and through said experience she has cultivated a high level of insight into global legal and risk management, finance and accounting, and sustainability, etc. The Company would like her to utilize this knowledge and experience to realize our management plans and to further improve the effectiveness of our management and the Board of Directors.
Paul Yonamine
Paul Yonamine
(August 20, 1957)
Independent Outside Director
Chairman & CEO of Central Pacific Financial Corp.
Executive Chairman of Central Pacific Bank
Outside Director of Sumitomo Mitsui Banking Corporation
Outside Director of circlace Inc.
He has a broad range of high level knowledge and experience in DX (digital transformation), organizational management, and finance and accounting, etc. cultivated through his extensive management experience at consulting firms, as President of IBM Japan, Ltd. and as CEO of overseas financial institutions, among others. The Company would like him to utilize this knowledge and experience to realize our management plans and to further improve the effectiveness of our management and the Board of Directors.
Stephen Hayes Dacus
Stephen Hayes Dacus
(November 7, 1960)
Independent Outside Director
Chairman of the Supervisory Board of Hana Group SAS
Chairman of Daiso California L.L.C.
He has served as a corporate executive officer in the retail industry and other industries both in the U.S. and Japan, and has a broad range of high level knowledge and experience in corporate management, marketing, finance and accounting, etc. cultivated through abundant global business experience. The Company would like him to utilize this knowledge and experience to realize our management plans and to further improve the effectiveness of our management and the Board of Directors.
Elizabeth Miin Meyerdirk
Elizabeth Miin Meyerdirk
(December 1, 1981)
Independent Outside Director
Chairwoman & CEO of Hey Favor, Inc.
She has a broad range of high level knowledge and experience in DX (digital transformation), marketing, finance and accounting, and other fields, cultivated through her experience as a founding member of Uber Eats, a division of Uber Technologies, Inc. in the United States and her management of e-commerce companies and other positions, in the United States. The Company would like her to utilize this knowledge and experience to realize our management plans and to further improve the effectiveness of our management and the Board of Directors.
Audit & Supervisory Board Member (Internal/Outside)
Name
(date of birth)
Area of Responsibility in the Company and Important Concurrent Positions Attendance at Board of Directors Meetings*1 Attendance at Audit & Supervisory Board Meetings*4 Reasons for Selection
(experience and knowledge)
Noriyuki Habano
Noriyuki Habano
(February 10, 1958)
Standing Audit & Supervisory Board Member
Audit & Supervisory Board Member of Sogo & Seibu Co., Ltd.
Audit & Supervisory Board Member of Ito-Yokado Co., Ltd.
16/16 27/27 He has broad knowledge related to the overall operations of the Group cultivated as a Senior Officer of the Auditing Office of the Company, as well as broad knowledge and experience in marketing, branding, risk management, etc. The Company would like him to contribute to the establishment of a good corporate governance structure that can realize the robust and sustainable growth of the Company, create medium- to long-term corporate value, and respond to social trust by utilizing his knowledge and experience.
Nobutomo Teshima
Nobutomo Teshima
(June 15, 1962)
Standing Audit & Supervisory Board Member
Audit & Supervisory Board Member of SEVEN-ELEVEN JAPAN CO., LTD.
Audit & Supervisory Board Member of York-Benimaru Co., Ltd.
He has extensive knowledge and experience in finance and accounting, risk management, and information technology, etc., as well as a broad range of knowledge of the Group’s overall operations, which he cultivated as a senior officer in the Accounting Management Department and Auditing Office. The Company would like him to contribute this knowledge and experience to the establishment of a good corporate governance structure that can realize robust and sustainable growth of the Company, create medium- to long- term corporate value, and respond to social trust.
Kazuhiro Hara
Kazuhiro Hara
(February 25, 1954)
Independent Outside Audit & Supervisory Board Member
Certified Public Accountant
Certified Tax Accountant
16/16 27/27 He has abundant experience and technical knowledge related to finance, accounting, tax, and risk management cultivated as a certified public accountant and tax accountant. The Company would like him to contribute to the establishment of a good corporate governance structure that can realize the robust and sustainable growth of the Company, create medium- to long-term corporate value, and respond to social trust by utilizing his knowledge and experience.
Mitsuko Inamasu
Mitsuko Inamasu
(March 15, 1976)
Independent Outside Audit & Supervisory Board Member
Attorney at Law
16/16 27/27 She has abundant experience and technical knowledge related to overall corporate legal affairs, including legal affairs pertaining to the digital field, and risk management cultivated as an attorney at law. The Company would like her to contribute to the establishment of a good corporate governance structure that can realize the robust and sustainable growth of the Company, create medium- to long-term corporate value, and respond to social trust by utilizing her knowledge and experience.
Kaori Matsuhashi
Kaori Matsuhashi
(June 7, 1969)
Independent Outside Audit & Supervisory Board Member
Certified Public Accountant
Representative Director of Luminous Consulting Co., Ltd.
Outside Director, Member of the Audit and Supervisory Committee of YASKAWA Electric Corporation
16/16 27/27 She has abundant experience and technical knowledge related to finance, accounting, business management, and risk management cultivated through her experience in a business company and as a consultant and certified public accountant. The Company would like her to contribute to the establishment of a good corporate governance structure that can realize the robust and sustainable growth of the Company, create medium- to long-term corporate value, and respond to social trust by utilizing her knowledge and experience.
*4 Attendance at meetings of the Audit & Supervisory Board held in the 17th fiscal year (from March 1, 2021 to February 28, 2022)

2. Numbers and composition ratios of Outside Directors and Outside Audit & Supervisory Board Members

As a holding company, the Company needs to conduct comprehensive and multifaceted management for diverse business domains. Accordingly, the composition of its Outside Directors and Outside Audit & Supervisory Board Members is to be examined considering not only ensuring diversity but also bearing in mind the overall balance of knowledge, experience, and skills. The Company therefore values having a diverse team of Outside Directors and Outside Audit & Supervisory Board Members to provide multifaceted management advice, including raising issues, and thereby ensures active discussion within the Board of Directors.
  While being extremely conscious of the diversity of its Outside Directors and Outside Audit & Supervisory Board Members, we believe that the most important aspect is "personnel selection." We have not yet reached the conclusion that setting formal numbers of Outside Directors and Outside Audit & Supervisory Board Members based on constant composition ratios would be optimal for the Company's Board of Directors. Therefore, we have not set a specific policy on the composition ratio of Outside Directors and Outside Audit & Supervisory Board Members, including Independent Outside Directors.
  We will continue to discuss this point, not only through dialogue with our stakeholders, but also based on social trends.

3. View on independence of Outside Directors and Outside Audit & Supervisory Board Members and independence standards [CGC Principle 4.9]

(1) Designation of Independent Directors and Independent Audit & Supervisory Board Members

The Company designates all Outside Directors and Outside Audit & Supervisory Board Members who satisfy the qualifications for independent officers as the Independent Outside Directors and Independent Outside Audit & Supervisory Board Members.

(2) Independence standards for Outside Directors and Outside Audit & Supervisory Board Members

As mentioned above, the Company emphasizes diversity in its Directors and Audit & Supervisory Board Members, including in Outside Directors and Outside Audit & Supervisory Board Members, and strives to secure high-quality external human resources who will support enhanced corporate governance. Accordingly, the Company has adopted the following standards for independence of Outside Directors and Outside Audit & Supervisory Board Members, considering that it is better to judge each candidate from the essential perspective of whether they have any potential conflict of interest with general shareholders.
  The opinions of the Outside Directors and Outside Audit & Supervisory Board Members were also considered in the adoption of the following standards; the Company will continue to discuss the standards going forward, noting that other companies and so forth have examined their independence standards from various perspectives.

1. Independence standards for Outside Directors and Outside Audit & Supervisory Board Members

i) Fundamental approach
Independent Directors and Independent Audit & Supervisory Board Members are defined as Outside Directors and Outside Audit & Supervisory Board Members who have no potential conflicts of interest with general shareholders of the Company.
  In the event that an Outside Director or an Outside Audit & Supervisory Board Member is likely to be significantly controlled by the management of the Company or is likely to significantly control the management of the Company, that Outside Director or Outside Audit & Supervisory Board Member is considered to have a potential conflict of interest with general shareholders of the Company and is considered to lack independence.
ii) Independence standards
In accordance with this fundamental approach, the Company uses the independence standards established by the financial instruments exchange as the independence standards for the Company's Outside Directors and Outside Audit & Supervisory Board Members.

2. De minimis thresholds for information disclosure regarding the attributes of Independent Directors and Independent Audit & Supervisory Board Members as negligible

(In the most-recent business year of the Company)

  • With regard to "transactions," "less than 1% of the non-consolidated revenues from operations of the Company in the most recent accounting period"
  • With regard to "donations," "less than ¥10 million"

4. Support system for Outside Directors and Outside Audit & Supervisory Board Members

The Company has assigned dedicated employees to assist the Outside Directors and Outside Audit & Supervisory Board Members in their duties, enabling close coordination and smooth exchange of information with the internal Directors and internal Audit & Supervisory Board Members. The Company has also concluded liability limitation agreements with Outside Directors and Outside Audit & Supervisory Board Members to ensure they can perform their roles as expected. These agreements limit the amount of their liability for compensation for damage to the minimum legally stipulated amounts.

5. Main activities of Outside Directors and Outside Audit & Supervisory Board MembersUpdated

(1) Remarks at meetings of the Board of Directors and the Audit & Supervisory Board during the 17th fiscal year (from March 1, 2021 to February 28, 2022)

Outside Director
Yoshio Tsukio
Yoshio Tsukio
Kunio Ito
Kunio Ito
Toshiro Yonemura
Toshiro Yonemura
Tetsuro Higashi
Tetsuro Higashi
Kazuko Rudy
Kazuko Rudy
Advice and proposals made by Outside Directors to ensure the validity and appropriateness of the Board's decision making Opinions based on his broad high level knowledge and experience including his experience being responsible for IT policy for the government, experience participating in city planning to be involved in constructing a sustainable society, and insights regarding measures to address natural environmental issues, etc. Opinions based on his broad high level knowledge and experience regarding finance, accounting, economics, ESG (Environment, Society, Governance), risk management, etc. Opinions based on his broad high level knowledge and experience regarding organizational management, risk management, etc. Opinions based on his broad high level knowledge and experience regarding international corporate management, management administration, finance, accounting, etc. Opinions based on her broad high level knowledge and experience regarding the retail industry, marketing, etc.
Outside Audit & Supervisory Board Member
Kazuhiro Hara
Kazuhiro Hara
Mitsuko Inamasu
Mitsuko Inamasu
Kaori Matsuhashi
Kaori Matsuhashi
Opinions expressed by Outside Audit & Supervisory Board Members Questions and opinions based on his abundant experience and technical knowledge related to finance, accounting, tax and risk management Questions and opinions based on her abundant experience and technical knowledge related to overall corporate legal affairs and risk management Questions and opinions based on her abundant experience and technical knowledge related to finance, accounting, management administration and risk management
*Outside Directors Yoshio Tsukio and Kazuko Rudy retired from their positions on May 26, 2022.

(2) Functions and roles of Outside Directors and Outside Audit & Supervisory Board Members

The Outside Directors and Outside Audit & Supervisory Board Members provide supervision or audits and advice and proposals from an external perspective based on their respective expertise and wide-ranging, high-level experience and insight into management from an objective and neutral standpoint with no risk of conflict of interest with general shareholders, and fulfill the function and role of ensuring valid and appropriate decision- making and business execution by the Board of Directors.

6. Exchange of opinions with Outside Directors and Outside Audit & Supervisory Board Members

In addition to meetings of the Board of Directors, Outside Directors and Outside Audit & Supervisory Board Members meet with the Representative Directors, Directors, Standing Audit & Supervisory Board Members, and others. These meetings including Management Opinion Exchange Meetings are held on a regular and as-needed basis. The themes are set for each of the meetings, centered on various management issues and matters of high social concern. Reports are provided by Directors, the internal control divisions, and so forth, regarding the status of business execution and internal control at the Company and its Group companies, and explanations are given in response to questions from the Outside Directors and Outside Audit & Supervisory Board Members, who also express their opinions regarding the Company's management, corporate governance, and other topics based on their respective expert knowledge and wide-ranging, high-level experience and insight into management. In these and other ways, the Outside Directors and Outside Audit & Supervisory Board Members coordinate with each other while exchanging frank and lively opinions.
  The Outside Directors and Outside Audit & Supervisory Board Members also exchange opinions with the Directors and Audit & Supervisory Board Members, etc. of operating companies.
  Through these activities, Outside Directors supervise operational execution, and Outside Audit & Supervisory Board Members perform audits of operational execution and accounting practices.

What is the Management Opinion Exchange Meeting?

Comprising all the Company's Directors and Audit & Supervisory Board Members, the Management Opinion Exchange Meeting is a meeting body aimed at explaining in advance the proposals at the Board of Directors meetings to the Directors and the Audit & Supervisory Board Members, as well as sharing information on the management and business strategies of the Company and operating companies.

7. Activities of the Board of DirectorsUpdated

(1) Setting the dates of the meetings of the Board of Directors and securing deliberation time

The meetings of the Board of Directors of the Company are basically held once per month, and are chaired by a Director selected by the Board of Directors.

Item Details
Setting the dates of the meetings of the Board of Directors Considering the increase in the number of Outside Directors and Outside Audit & Supervisory Board Members, as well as the fact that some Directors reside overseas, the Company begins preparations early and sets the dates of meetings six months prior to the commencement of the fiscal year.
Deliberation time
  • In light of the fact that meeting materials are shared in advance, the key points of the agenda are explained clearly and briefly, while sufficient time is allocated for question and answer sessions and discussion.
  • The Company is making efforts to secure sufficient time for deliberation, through means such as prolonging the meetings themselves, in order to accommodate the recent increase in active discussions from diverse standpoints.
Matter for resolution and reporting If further deliberation is required, the agenda, etc. after being redrafted and improved to reflect the observations of the Board of Directors, is again presented as follow-up deliberations at the next and subsequent meetings of the Board of Directors, and is accordingly confirmed and resolved, etc.
Deliberation time of the meeting of the Board of Directors*
Deliberation time of the meeting of the Board of Directors
Deliberation time of the Management Opinion Exchange Meetings*
Deliberation time of the Management Opinion Exchange Meetings

*The period of the calculations was from March of the year to February of the following year

(2) Matters for deliberation

Although the Board of Directors deliberates a wide range of topics, the major items and the points of each item are as follows. (The following presents examples. Accordingly, deliberations include, but are not limited to these items.)

Main matters for deliberation Examples of main themes discussed from March 2021 to April 2022
1. Matters determined by laws and regulations, including the Companies Act
  • Approval of quarterly financial statements
  • Approval of the agenda of the Shareholders' Meetings, etc.
2. Matters determined by the Corporate Governance Code (including deliberations on matters related to sustainability, such as environmental policy)
  • Assessment of cross-shareholdings
  • Evaluation of the Board of Directors' effectiveness
  • Confirmation of responses to TCFD recommendations
  • Revision of CO2 emission reduction target in the environmental declaration『GREEN CHALLENGE 2050』
  • Establishment of the Seven & i Group Human Rights Policy
  • Revision of material issues (Materiality), etc.
3. Items for deliberations, in cooperation with the Nomination Committee and the Compensation Committee (including the succession plan and revision of the compensation system for Directors and Audit & Supervisory Board Members)
  • Revision of the Guidelines for Directors and Audit & Supervisory Board Members (clarifying that the concept of diversity in the composition of the Board of Directors includes career and age)
  • Revision of the compensation system for Directors and Audit & Supervisory Board Members (addition of employee engagement as a KPI for the performance-based and stock-based compensation)
  • Addition of companies subject to deliberation by the Nomination Committee and the Compensation Committee, etc.
4. Progress of the Medium-Term Management Plan, and the strategies and policies of the Group and its operating companies
  • Overseas CVS business strategy, domestic CVS business strategy, Group food strategy, large-scale commercial base strategy, Last Mile initiatives, DX/financial strategies, and sustainability strategy
  • Formulating the Medium-Term Management Plan 2021−2025
  • Deliberation of the Group’s business portfolio, etc.
5. Management situation of the major operating companies (including PMI reports)
  • PMI report of major acquisition by 7-Eleven, Inc., etc.
6. Internal controls, the status of risk management, and the implementation status of compliance
  • Reports of the internal auditing division
  • Activity reports of the CSR Management Committee, Risk Management Committee, and Information Management Committee, etc.

8. Evaluation of the Board of Directors' effectiveness [CGC Supplementary Principle 4.11.3]Updated

(1) Fundamental approach to evaluation of the Board of Directors' effectiveness

The Company conducts the Board of Directors' effectiveness evaluation (referred to as "Board of Directors' evaluation") through objective analysis and thorough discussions by members of the Board of Directors regarding "whether the Board of Directors is effectively functioning to realize corporate value and improve corporate governance as the Company aims." The evaluation is positioned as an important factor in the PDCA cycle leading to specific actions for further improvements.
  In addition, the Company has established the Board of Directors' evaluation implementation policy, as follows.

Board of Directors' evaluation implementation policy
  • 1. The evaluation shall basically be a "self-evaluation," to be performed each year by all Directors and all Audit & Supervisory Board Members.
  • 2. Progress of the important topics set in the previous year's Board of Directors' evaluation shall be confirmed and evaluated.
  • 3. With regard to the Board of Directors' evaluation process (conducting surveys and interviews, utilizing third-party organizations, etc.), the Board of Directors' secretariat shall prepare a draft each time, and this draft shall be discussed by the Board of Directors.

(2) FY2022 Board of Directors' evaluation process

Overview

With regard to the FY2022 Board of Director' evaluation process, the evaluation was carried out by utilizing third-party organizations to conduct surveys and individual interviews with all Directors and Audit & Supervisory Board Members, followed by discussions with all members.

Pre-evaluation survey Individual interviews Discussion
FY2018 Conducted for all Directors and all Audit & Supervisory Board Members Conducted for all Directors and all Audit & Supervisory Board Members Conducted for all Directors and all Audit & Supervisory Board Members
FY2019 Conducted only for newly appointed Directors and newly appointed Audit & Supervisory Board Members
FY2020 Conducted for all Directors and all Audit & Supervisory Board Members
FY2021
FY2022

Scope of evaluation

In addition to the Board of Directors itself, the scope of evaluation also covered relevant meeting bodies such as the Nomination Committee and the Compensation Committee, advisory bodies, as well as the Management Opinion Exchange Meeting and the Audit & Supervisory Board.

Points of FY2022 Board of Directors’ evaluation

  • 1. Strengthening third-party involvement in the Board of Directors’ evaluation processs
  • 2. Reflecting the followings in the evaluation items
    • Corporate Governance Code revised on June 11, 2021
    • Progress on priority issues such as the Medium-Term Management Plan and large-scale acquisitions
  • 3. The following fixed-point evaluation items were continued in principle
    • Evaluation of the progress of the important topics determined by the previous year’s Board of Directors’ evaluation
    • Fixed-point evaluations of important corporate governance-related items, as topics for the Board of Directors
    • Evaluation of the Audit & Supervisory Board, in addition to advisory bodies of the Board of Directors, etc. (the Nomination Committee, the Compensation Committee and the Management Opinion Exchange Meeting)

(3) Evaluation schedule and evaluation process

Overviews of the Board of Directors' evaluation schedule and process are as below.

Overviews of evaluation schedule and process
Evaluation schedule and evaluation process
Overviews of evaluation schedule and process
Evaluation schedule and evaluation process

(4) Results of Board of Directors' evaluation

The overview of the aforementioned Board of Directors' evaluation (resolved on April 19, 2022) is as below.

Overview of results of the FY2022 Board of Directors' evaluation

  • 1. Survey and interview results were reported by the third party for the first time at a meeting of the Board of Directors to ensure objectivity
  • 2. Major issues that emerged from the results of the survey and interviews were carefully discussed by the Board of Directors.
  • 3. Based on this discussion, FY2023 important topics will be newly set from the overall list and will be followed up as the subjects of the Board of Directors’ meeting for this fiscal year.

FY2023 important topics [Evolution (deepening) of meetings of the Board of Directors following changes in the composition of the Board of Directors]

Important topics Measures
Evaluation of the progress and verification of the Group’s important strategies
  • Conduct appropriate monitoring, as the Board of Directors, regarding the progress and achievements of the Group’s important strategies in relation to the Medium-Term Management Plan 2021 - 2025 (Group food strategy, DX/financial strategy (Last Mile strategy, CRM strategy), etc.) together with a confirmation of the effects of investments
Evaluation of the progress and verification of businesses of core operating companies
  • In addition to confirming and verifying the degree of achievement of the business progress and performance of core operating companies in relation to the new Medium-Term Management Plan, conduct appropriate monitoring of the status of risk management
Ongoing review of business portfolio and development of a capital re-allocation plan
    The following items should be confirmed intensively at the meeting of the Board of Directors
  • Assess the progress of fundamental structural reforms in priority structural reform areas and examine the best owners of other businesses
  • Concentrate investment in CVS business, which is a growth area of free cash flow
  • Enhance shareholder returns by flexibly acquiring treasury stock according to the state of growth investment
Governance Strengthening the Group’s governance structure
  • Conduct appropriate monitoring with regard to the Group’s governance and risk management structures
Promoting sustainable management
  • Promote group-wide efforts to address climate change based on the Medium-Term Management Plan 2021-2025 for sustainable management
Engagement with investors
  • Report the status of dialogue with investors and feedback from investors at least twice a year
Employee engagement
  • Report on initiatives to improve employee engagement and the results of an engagement survey approximately twice a year

We will confirm and evaluate the progress on these important topics at upcoming and future evaluations of the Board of Directors.
  Based on the results of this evaluation of the Board of Directors' effectiveness, we will work to further improve the effectiveness of the Board of Directors in order to achieve sustainable growth and increase corporate value over the medium to long term.