CORPORATE GOVERNANCE
Corporate Governance Report
Last Update: December 19,2025
TAIYO YUDEN CO., LTD.Katsuya Sase Representative Director, President and CEO Contact: 03-6757-8310
Securities code: 6976 https://www.yuden.co.jp/en/
The corporate governance of TAIYO YUDEN CO., LTD. (the "Company") is described below.
-
Basic Views on Corporate Governance, Capital Structure, Corporate Attributes, and Other Key Information
Basic Views
The TAIYO YUDEN Group (the "Group") is committed to corporate social responsibilities and the mission of management to develop businesses on an ongoing basis while fulfilling sociality, public interest and public nature of the Group from a global viewpoint to put into practice and realize "Mission," "Management philosophy" and "Vision".
Based on the views, the Company has been established Basic Policy of Corporate Governance, and emphasizes transparency and fairness of corporate management, the Company is making efforts to enhance corporate governance under the supervision of the Board of Directors, including the development of structures and mechanisms that enable timely and appropriate information disclosure, thorough compliance, and speedy decision making and execution of duties.
【Mission】
Stronger and more socially aware through the wonders of science
【Management Philosophy】 Employee Well-being
Betterment of Local Communities
Responsibility to Provide Returns to Shareholders
【Vision】
To be an excellent company that enjoys the trust and highest regard from all stakeholders
Basic Policy for Corporate Governance https://www.yuden.co.jp/en/ir/governance/basic.html
Disclosure Based on each Principle of the Corporate Governance Code[Principle 1-4: Cross-Shareholdings]
The Company have sold all our cross-shareholdings (listed stocks).
Cross-shareholdings are disclosed in the Notice of Convocation of the General Meeting of Shareholders.
Notice of Convocation of the General Meeting of Shareholders https://www.yuden.co.jp/en/ir/library/shm_presentation.html
Policy of holding cross-shareholdings is as follows.
The Company shall hold cross-shareholdings only if the Board of Directors determines that such holdings facilitate medium- to long-term improvement in corporate value and sustainable growth. Moreover, the Board of Directors shall comprehensively assess the significance of holding all of its cross-shareholdings annually, and based on such findings shall furthermore prudently consider options that include the possibility of selling holdings with respect to which there is a lack of necessity and rationale for maintaining possession. Additionally, the Company shall appropriately exercise the voting rights associated with its cross-shareholdings in a manner that involves determining whether to approve or reject each proposal upon having comprehensively assessed factors that include whether or not a proposal is conducive to increasing medium- to long-term corporate value of the Company and the issuer.
When cross-shareholders indicate their intention to sell their shares, the Company shall not hinder the sale of the cross-held
shares by, for instance, implying a possible reduction of business transactions.
[Principle 1-7: Create appropriate procedures and frameworks for transactions between related parties]
The Company shall resolve competitive transactions and conflict-of-interest transactions by Directors through the Board of Directors based on the Board of Directors Regulations. Transactions between related parties shall be disclosed in accordance with relevant laws, such as the Companies Act and the Financial Instruments and Exchange Act, as well as the rules and regulations established by stock exchanges.
The Board of Directors shall monitor the facts and situations of related party transactions appropriately.
[Supplemental Principle 2-4-1: Ensuring diversity in the promotion to core human resources]
In order to realize one of our Management Philosophy, "Employee Well-being," we consider the promotion of diversity to be a key management issue, as we believe that "value of being different" and that we should connect and utilize diverse personalities so that each individual can work with enthusiasm and fulfillment. In this context, the Company is making the following efforts to promote women, foreign nationals, and mid-career hires to management and other positions.
Regarding the promotion of female to management positions, etc.
In our Medium-term Management Plan, we have set a goal of achieving a ratio of 10% or higher female managers by 2030, and are working to provide opportunities to gain experience, create an environment that enables diverse work styles, and promote awareness among female and male through workshops, roundtable discussions, and various types of training. As of April 1, 2025, the ratio of female employees and female managers of the Company was 25.8% and 6.5%, respectively.
Regarding the promotion of non-Japanese to management positions, etc.
While the Company strives to secure excellent human resources regardless of nationality, the ratio of non-Japanese employees (regular employees) in the Company as of March 31, 2025, was 0.9%. As for the ratio of non-Japanese managers, it is very small, and we intend to increase the ratio of non-Japanese managers by increasing the number of non-Japanese hires according to the skills needed by the Company in the future.
Regarding the promotion of mid-careers to management positions, etc.
In order to ensure sustainable growth, the Company is actively recruiting professionals and experienced personnel from outside the Company, and as of March 31, 2025, the ratio of mid-careers in management positions was 31.9%. No special targets have been set for mid-careers, as they do not differ from other employees in terms of advancement or promotion to management positions.
[Principle 2-6: Roles of Corporate Pension Fund as Asset Owner] The Company has no corporate pension system.
The Company shall implement a defined contribution corporate pension plan to build stable assets for employees, and shall provide education and training regarding asset management.
[Principle 3-1: Full disclosure]
Our mission, management philosophy and vision are described in "1. Basic Views" on this report.
Our management strategy and business plans are disclosed in the Integrated Report.
Our fundamental concepts of corporate governance as well as basic policies are described in "1. Basic Views" on this report.
Policies and procedures for the Board to determine director remuneration are disclosed in the Notice of Convocation of the General Meeting of Shareholders.
Policies and procedures for the nomination of candidates for Director are disclosed in the Integrated Report.
Individual reasons regarding the selection of candidates for Director are disclosed in the Notice of Convocation of the General Meeting of Shareholders.
Integrated Report https://www.yuden.co.jp/en/ir/library/annual_reports.html
Notice of Convocation of the General Meeting of Shareholders https://www.yuden.co.jp/en/ir/library/shm_presentation.html
[Supplemental Principle 3-1-3: Initiatives on sustainability]
Initiatives on sustainability
The Company has formulated the "Medium-term Management Plan 2025," which started in Fiscal 2021. The Company aim to increase corporate value by increasing both economic and social value, and set KPI (numerical targets) after clarifying the Materiality (important issues) related to economic and social value. The progress of initiatives to achieve the targets are disclosed in the Integrated Report and on the Company's website.
Integrated Report https://www.yuden.co.jp/en/ir/library/annual_reports.html
Sustainability https://www.yuden.co.jp/en/sustainability/
Initiatives on human capital
In keeping with the philosophy of the Group's founder, TAIYO YUDEN Group understands the importance of workforce diversity and endeavors to encourage individual employees to express their unique character and personality, hoping to help them lead an enriched life.
Bearing the above in mind, we build and implement ongoing human resources development strategies, focusing on two areas: globalization skills for implementing management strategies based on experience of different cultures; and innovation capabilities for creating new value to contribute to society by exercising strengthened professional expertise and creativity. Also, seeking to perform our HR mission to "shape the future of individuals and organizations," we are striving to create an environment that encourages both individuals and organizations to fulfill their potential and accelerate HR development efforts. Through these activities, we aim to facilitate the personal growth of each employee and increase our overall corporate value.
Details are disclosed on the Company's website.
Sustainability (Human Resources Strategy) https://www.yuden.co.jp/en/sustainability/society/training/
Initiatives on Intellectual Property Rights
At the Company, the Intellectual Property Department and the Development and Engineering Department work in close cooperation with each other from the early stages of developing new technologies and obtaining intellectual property rights. In addition, we manage the process of creating, protecting, and leveraging our intellectual properties through a unique management approach that is optimized for each business unit.
Details are disclosed in the Integrated Report
Integrated Report https://www.yuden.co.jp/en/ir/library/annual_reports.html
Initiatives on climate change
As the impact of climate change on society, including frequent wind and flood disasters, becomes more severe, the role that companies must play in realizing a decarbonized society is becoming more important. In the Company's Medium-term Management Plan, we aim to enhance corporate value by focusing on both economic value and social value, and we consider strengthening our response to climate change as an important management issue.
In response to climate change, a global issue, the Company is promoting manufacturing based on decarbonization philosophy in order to achieve carbon neutrality. We have set a mid-term target for reduction of GHG emissions by 42% compared to FY2020 levels by FY2030, in line with the 1.5°C Science Based Targets (SBT), and in FY2024, we received certification for the Near-Term Target from SBTi. We are thoroughly implementing efforts in the areas of energy saving, energy creation, and the utilization of renewable energy.
The Company aims to contribute to achieving the international goals set forth in the SDGs and the Paris Agreement, and we are working toward achieving these goals in collaboration with Group companies and through cooperation with a wide range of stakeholders. In addition, we recognize the importance of climate-related financial information disclosure, support the Task Force on Climate-related Financial Disclosures (TCFD), and are expanding our disclosure of information in line with the TCFD recommendations.
Details are disclosed in the Safety & Environmental Report and the Integrated Report.
Safety & Environmental Report https://www.yuden.co.jp/en/sustainability/document/report/
Integrated Report https://www.yuden.co.jp/en/ir/library/annual_reports.html
[Supplemental Principle 4-1-1: Scope of delegation to the management]
The Company delegates authority to Executive Directors in relation to decisions on important matters of business execution to expedite and streamline such decisions. To ensure the effective decision making by the Board of Directors, the Management Committee shall deliberate in advance policy matters regarding business operations for Group management, whereas the TM (Top Management) Meeting shall deliberate in advance matters concerning personnel, organization and remuneration systems for the entire Group. Both organs shall determine matters delegated by the Board of Directors.
Operating Officers are in place in order to further clarify roles and responsibilities of Directors who monitor and supervise the management of business and persons who execute business operations. The Operating Officers shall conduct business flexibly and quickly as an executor responsible for the section he or she is in charge, under the direction of the President and CEO, in accordance with management policies and strategies determined at meetings of the Board of Directors.
[Principle 4-9: Independence Criteria and Qualification for Outside Director]
In order to ensure the independence of Outside Directors, the Company has established its "Standards for the Independence of Outside Directors" in addition to the requirements of Outside Directors stipulated in the Companies Act and the independence standards stipulated by the Tokyo Stock Exchange. The outline is as follows.
"Standards for the Independence of Outside Directors (Summary)" shall be disclosed on the Company's website.
Standards for the Independence of Outside Directors (Summary) https://www.yuden.co.jp/en/ir/governance/nomination.html#anc-04
[Supplemental Principle 4-10-1: The mandates and roles of the Nomination Committee and the Remuneration Committee]
To strengthen the independence and objectivity of the functions of the Board of Directors concerning the nomination and remuneration for Directors and Operating Officers and to fulfill its accountability, the Company has established two voluntary advisory panels: Nomination Committee and Remuneration Committee.
Each committee, presided over by an Independent Outside Director, consists of all the Independent Outside Directors who are not Audit and Supervisory Committee Members, along with the Representative Director, President and Chief Executive Officer. For auditing purposes, one member appointed by the Audit and Supervisory Committee attends Each committee's meetings.
The composition, status of activities and main deliberation topics of each committee are described in "2. Matters Concerning Functions of Business Execution, Auditing and Supervision, Nomination, and Remuneration Decisions (Overview of Current Corporate Governance System)" of "II. Business Management Organization and Other Corporate Governance Systems regarding Decision-making, Execution of Business, and Oversight" on this report.
[Supplemental Principle 4-11-1: Views on the appropriate balance between knowledge, experience and skills of the board as a whole, and also on diversity and appropriate board size]
Please refer to "2. Matters Concerning Functions of Business Execution, Auditing and Supervision, Nomination, and Remuneration Decisions (Overview of Current Corporate Governance System)" of "II. Business Management Organization and Other Corporate Governance Systems regarding Decision-making, Execution of Business, and Oversight" on this report.
The composition and skills matrix of the Board of Directors of the Company is disclosed in the Notice of Convocation of the General Meeting of Shareholders and the Integrated Report.
Notice of Convocation of the General Meeting of Shareholders https://www.yuden.co.jp/en/ir/library/shm_presentation.html
Integrated Report https://www.yuden.co.jp/en/ir/library/annual_reports.html
[Supplemental Principle 4-11-2: Concurrent positions of Directors]
Directors shall not concurrently serve as Directors of other companies unless the Board of Directors deems this to be in the best interests of the Company.
If Outside Directors concurrently serve as corporate officers of other companies, the Board of Directors shall confirm the amount of time required for them to fulfill their duties as outside Directors of the Company, before approving their appointment.
Significant concurrent positions of Outside Directors are disclosed in the Notice of Convocation of the General Meeting of Shareholders.
Notice of Convocation of the General Meeting of Shareholders https://www.yuden.co.jp/en/ir/library/shm_presentation.html
[Supplemental Principle 4-11-3: Analysis and assessment regarding the effectiveness of the Board as a whole]
The Company conducts the evaluation of the effectiveness of the Board of Directors annually to improve the effectiveness of the Board of Directors and enhance its corporate value. In addition to revising the evaluation items and questionnaire content, based on the suggestions of an external evaluation agency, we had the external evaluation agency be in charge of the administration from the distribution of the questionnaire and the aggregation of answers to the analysis of results in order to increase the objectivity and transparency of the evaluation process. The evaluation process and results for the current fiscal year are as follows.
Evaluation process
Consider the evaluation methods and questionnaire content for the current fiscal year, based on the suggestions and advice of the external evaluation agency, and report to the Board of Directors.
The external evaluation agency conducts a (anonymous) questionnaire to evaluate the effectiveness of all Directors.
The external evaluation agency compiles and analyzes the results of the questionnaire described in ii) above, extracts issues and opinions that may require discussion, and reports them.
Evaluation meetings were conducted by all Directors based on the results of the questionnaire in iii) above.
Discussed opinions and issues that come up in the evaluation meetings by the Board of Directors, and determined any issues to be addressed.
Evaluation (Questionnaire) items
Composition and operation of the Board of Directors
Management strategy and management plan
Corporate ethics and risk management
Supervision of nomination and remuneration
Dialogue with shareholders, etc.
Evaluation by external organization
Based on their evaluation, the external evaluation agency found that the Company is working seriously on the evaluation of the effectiveness of the Board of Directors and is striving to improve its corporate value further. In particular, based on the results of the effectiveness evaluation questionnaire, all Directors held discussions to review the necessity of separating supervision and execution, as well as the composition of the Board of Directors as a supervisory body; this initiative was highly praised for fostering a shared understanding among all Directors on the significance of enhancing effectiveness, while engaging in the
"Evaluation of the Effectiveness of the Board of Directors" with a consciousness of the PDCA cycle.
Status of initiatives for issues in the previous fiscal year
Issue i) "Discussion on investments in human capital that are linked to the management strategy"
The Board of Directors receives regular reports on activities and investments related to human capital, and oversees the progress of these efforts; however, since improvements in evaluation take time, we recognize this as being an ongoing issue and will continue to address it.
Issue ii) "Review of matters to be deliberated and how deliberations should be conducted at the Board of Directors meetings" In conjunction with the transition to a company with Audit and Supervisory Committee, the delegation of authority to Executive Directors has been promoted, and a review of matters to be submitted to the Board of Directors and related regulations was conducted in order to allow the Board to spend more time deliberating on medium- to long-term management issues.
Issues for the current fiscal year
With the transition to a company with Audit and Supervisory Committee and an increased ratio of outside directors on the Board of Directors, we recognize the need to deepen discussions on "the composition of the Board of Directors as a monitoring body and the roles of individual directors," and have identified this as being a new issue to address. The Company will endeavor to maintain and enhance the effectiveness of the Board of Directors by continuously working on the issue i)"Discussion on investments in human capital that are linked to the management strategy" in (4) above, in addition to newly recognized issues.
Details are disclosed on the Company's website. https://www.yuden.co.jp/en/ir/governance/effectiveness_evaluation.html
[Supplementary Principle 4-14-2: Principles for Training of Directors]
The Company shall provide Directors with opportunities to attend in-house training courses such as external seminars and related laws and regulations to help them acquire knowledge and information outside their fields of expertise, and the Company shall bear the necessary expenses. Plans for provision and mediation of training opportunities shall be created and implemented at the beginning of each year.
To raise the effectiveness of audits, Audit & Supervisory Board Members discuss valuable skills at the Audit & Supervisory Board meeting and provide training.
[Principle 5-1: Policies for Constructive Dialogue with Shareholders]
The Company shall designate a Director in charge of IR and conduct IR activities to promote a constructive dialogue with shareholders and investors.
The Company shall also report to the Board of Directors any opinions and requests from shareholders and investors collected through IR activities.
Specifically, the following activities are to be included in the Company's organizational structure.
Strengthening collaboration between the management of the IR department and other departments through the Director responsible for IR.
Results briefings with securities analysts and institutional investors (quarterly).
Handling group meetings and individual meetings with major foreign and domestic individual investors.
Explanations to major investors regarding General Meeting of Shareholders proposals.
Publishing consolidated reports to enhance the understanding of the Company's mid- and long-term value creation.
Conducting investigations of shareholder findings through external survey organizations.
For fairness in the disclosure of information and to prevent leaks of inside information, the information disclosed in dialogues with major shareholders and investors shall be within the bounds previously determined for disclosure.
[Status of Dialogue with Shareholders and Investors]
The Company aspires to be trusted by shareholders and investors. We work on increasing our disclosures and transparency and harnessing shareholders and investors' opinions learned through dialog with them to inform our business activities, as a result increasing our corporate value.
Main activities are disclosed on the Integrated Report.
Integrated Report https://www.yuden.co.jp/en/ir/library/annual_reports.html