Corporate Officer Compensation

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Compensation paid to the Company's corporate officers in the year ended March 31, 2016, was as per the following tables.

1. Total amount of compensation by corporate officer title, by type of compensation, and number of officers receiving

Corporate officer title Total
compensation
(Millions of yen)
Total compensation by type (Millions of yen) Number of corporate officers eligible for compensation
Basic compensation Performance-based
compensation
Stock option Other
Directors
(excluding Outside
Directors)
230 171 - 58 - 3
Executive Officers 1,485 721 582 144 37 11
Outside Directors 87 70 - 17 - 5

1. The total compensation of corporate officers shown above includes the compensation of the Company and the Company's subsidiaries.
2. The three Directors with concurrent Executive Officer positions at the end of the fiscal year are included in the total amount of compensation and the total number of corporate officers for Executive Officer positions.
3. Executive Officer compensation based on earnings includes performance-based compensation reflecting earnings booked in the fiscal year ended March 31, 2016, of ¥16 million (with respect to 2 corporate officers) and transfers to reserves for earnings-based compensation reflecting earnings booked over the medium-to-long term (April 2015 to March 2018) of ¥566 million (with respect to 11 corporate officers).
4. The total number of Directors and Executive Officers eligible to receive stock options is 17.
5. One officer is eligible for "Other."

2. Total compensation of officers receiving ¥100 million or more

Name Corporate
officer title
Company Total
compensation
(Millions of yen)
Total compensation by type (Millions of yen)
Basic compensation Performance-based compensation Stock option Other
Yoichiro Ushioda Director LIXIL Group Corporation 164 120 - 44 -
Director LIXIL INTERNATIONAL Pte. Ltd. 5 5 - - -
Yoshiaki Fujimori Executive
Officer
LIXIL Group Corporation 524 180 300 44 -
Kinya Seto Executive
Officer
LIXIL Group Corporation 125 50 75 - -
Takashi Tsutsui Executive
Officer
LIXIL Group Corporation 120 69 36 15 -
Yosuke Yagi Executive
Officer
LIXIL Group Corporation 118 69 35 14 -
Sachio Matsumoto Executive
Officer
LIXIL Group Corporation 106 63 35 8 -
Hwa Jin Song Montesano Executive
Officer
LIXIL Group Corporation 112 53 12 10 37

1. Regarding performance-based compensation reflecting earnings, transfers to reserves for earnings-based compensation reflecting earnings, booked over the medium-to-long term (April 2015 to March 2018) have not been made. In addition, no compensation reflecting short-term earnings in the fiscal year ended March 31, 2016, was paid.
2. Stock options are booked as expenses in the fiscal year with regard to the 2013 stock options granted on May 9, 2013, the 2014 stock options granted on May 23, 2014, and the 2014 stock options granted on December 12, 2014, and differ from the amounts obtained from the actual execution and sale.
3. "Other" consists of allowances made for disparities in compensation compared with previous positions and such factors as cost of living assistance and medical insurance associated with overseas postings.

3. Policy for determining the amount and method of calculation of corporate officers' compensation and decision-making method

Basic policy on compensation, etc.

The Company's policy on the compensation plan for corporate officers is to implement a fair compensation structure that will motivate each corporate officer to execute his or her duties in order to meet shareholders' expectations and fulfill the Company's business policy.

  • Performance accountability of individuals and companies shall be clearly established, and a system shall be devised that will reward corporate officers with appropriate compensation upon the achievement of a goal in order to motivate corporate officers to attain the goals set.
  • A stock option plan shall be provided to allow for the reflection of continual enhancement of corporate value, in addition to which a medium-to-long term cash plan shall be adopted to provide incentives to executive officers, who are responsible for the execution of business operations, to attain medium-term business plan targets.
  • The compensation system shall be performance-based compensation to allow for appropriate reflection of the Group's consolidated performance.
  • In order to ensure the objectivity and transparency of directors' compensation, the Compensation Committee shall assess the Company's compensation level by comparing it with objective external indicators and manage it to ensure that the level is commensurate with the relevant duties and performance.
  • Compensation levels shall be set to be sufficient to retain, for the long-term, competent, worldwide human resources who are indispensable to the Company's sustainable growth.

Compensation structure

Under the corporate officers' compensation structure, there shall be separate structures for directors, who are responsible for governance, and executive officers, who are responsible for the execution of business operations, in order to reflect the differences in their roles. In the case of a director who is concurrently serving as an executive officer, the compensation plan for executive officers shall be applied.

[Compensation structures for directors and executive officers]

  • A director's compensation shall consist of basic compensation and stock options.
  • An executive officer's compensation shall consist of basic compensation, performance-based compensation linked to single fiscal year-end and medium-to-long term earnings, and stock options. For personnel recruited to senior positions among overseas nationals, an expatriate package will be provided with tax equalization and other incidental conditions generally offered at global companies.

[Description of compensation by type]

  • Basic compensation, as a fixed compensation, shall be maintained at an appropriate level through comparison with objective external indicators. The basic compensation for executive officers shall be structured such that a certain percentage thereof fluctuates in accordance with the level of achievement of business targets set for the relevant department in order to reward Executive Team for achieving goals.
  • Performance-based compensation shall be determined on the basis of corporate performance for the current fiscal period and over the medium-to-long term reflecting the attainment of medium-term plan targets, to avoid compensation being based only on short-term performance.
  • Performance-based compensation linked to a single fiscal year shall be allocated as an annual bonus reflecting earnings in the current fiscal period. Performance-based compensation based on corporate performance over the medium-to-long term is to be allocated after the end of a specified period conditional on the attainment of medium-term business plan targets within previously specified limits.
  • Stock options, provided as a medium-to-long-term incentive in line with the interest of shareholders, shall be determined on the basis of corporate performance, the position of the relevant corporate officer, and other criteria.
  • With personnel recruited to senior positions from overseas, an allowance may be made to make up for disparities in compensation compared with previous positions and such factors as cost of living assistance and medical insurance associated with overseas postings.

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