Basic Concept
Fujikura has chosen to be a company the Audit and Supervisory Committee. This is to establish a more agile and efficient operational structure by significantly delegating authority from Board of Directors' Meeting to the executive directors. In addition, the multiple independent Outside Director possess diverse and advanced expertise, and by conducting thorough deliberations, the company aims to strengthen its oversight function.
Fujikura Group 's corporate governance structure, reflecting the above considerations, is as follows:
Governance system
(After the Ordinary shareholders' meeting for the fiscal year ending March 2025)
Board of Directors' Meeting
The total number of directors after the end of the regular shareholders' meeting for the fiscal year ending March 2025 is 10. Of these, the majority of six are Outside Director, all of whom are independent of Fujikura's management (independent outside directors) and each have management experience, financial and accounting expertise.
In addition, the Board of Directors' Meeting consists of six directors (including three Outside Director) who are not Audit and Supervisory Committee members and four directors (including Outside Director three directors), and the management of the Audit and Supervisory Committee is chaired by full-time Audit and Supervisory Committee members, who are directors who are not responsible for business execution, from the perspective of strengthening the supervisory function of the Board of Directors' Meeting.
In Board of Directors' Meeting, important matters related to management (such as the formulation of medium- to long-term strategy, review of the business portfolio, etc.) are decided through thorough discussions between Outside Director and internal directors with diverse knowledge and expertise.
During fiscal year 2024, Board of Directors' Meeting held 15 meetings, and through thorough discussions including those with independent outside directors, discussed, decided, and reported on matters such as the nomination of director candidates, matters concerning compensation, the formulation and progress confirmation of quarterly and annual management plans, the development of medium-term management plans, the review of business portfolio, decisions on important investment projects, matters related to the reorganization of group companies, and other important matters related to management.
Furthermore, in order to enable Outside Director to engage in thorough discussions at Board of Directors' Meeting, materials for Board of Directors' Meeting are distributed in advance, and depending on the content of the agenda items, meetings to explain the agenda items (Board of Directors' Meeting meetings) are held beforehand.
Business Execution System
By resolution of Board of Directors' Meeting, we have established a system in which we appoint a Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Chief Financial Officer (CFO). The CEO is the CEO for the entire Fujikura Group, the CTO is the chief executive officer in the field of technology development, and the CFO is the chief executive officer in the field of finance. With the CEO at the top, the CTO and CFO complement and support the CEO's functions in the fields of technology development and finance, which each require a high level of expertise. This "three-headed system" enables business operations based on more advanced and effective management decisions.
The Audit and Supervisory Committee
As of the end of the ordinary shareholders' meeting fiscal year ending March 31, 2025, the total number of directors of the Board of Directors is four, consisting of one full-time internal director and three independent outside directors. the Audit and Supervisory Committee From the viewpoint of improving the effectiveness of the execution of duties by the full-time Audit & Supervisory Board Members, the full-time Audit & Supervisory Board Members may attend Executive Management Council and other important meetings related to the execution of business their duties and express their opinions. In addition, the Audit Committee members are guaranteed the right to seek opportunities to exchange views and opinions with each business responsible person, with whom they meet on a regular and ad hoc basis. resolution In addition, an the Audit and Supervisory Committee office has been established under the direction of organization to assist the activities of the Audit and Supervisory Committee, and a full-time person has been assigned to this office. the Audit and Supervisory Committee met 17 times during fiscal 2024 to discuss matters based on the audit plan and other matters necessary for the supervision of the execution of operations by the executive directors.
Independent Outside Board of Directors' Meeting
Outside Director perform their duties as audit and supervisory committee members or directors from an objective standpoint independent of Fujikura management, according to their professional expertise. In order to ensure effective discussions at Board of Directors' Meeting, an independent outside Board of Directors' Meeting, composed solely of independent outside directors, will be established after the ordinary shareholders' meeting for the fiscal year ending March 2025. This meeting will facilitate information exchange and shared understanding among Outside Director and will make recommendations as needed.
Nomination and Remuneration of Directors
<Nomination Advisory committee >
When Board of Directors' Meeting makes decisions regarding the following matters concerning the nomination of directors, the Nomination Advisory committee (composed of a majority of Outside Director and the chairperson of the committee by an Outside Director), which serves as an advisory body to the Board, will verify the fairness and appropriateness of the decision-making process.
Main consultation matters
Proposal for the shareholders' meeting regarding the appointment and dismissal of directors
Criteria for selection and dismissal of directors
Succession planning
Independence Criteria for Outside Director
In fiscal 2024, the Nomination Advisory committee met a total of seven times.
<Remuneration Advisory committee >
When Board of Directors' Meeting makes decisions regarding the following matters concerning directors' compensation, the Compensation Advisory committee (composed of a majority of Outside Director and the chairperson of the committee by an Outside Director), which serves as an advisory body to the Board, will verify the fairness and appropriateness of the decision-making process.
Main consultation matters
Disciplines for determining directors' remuneration and the amount thereof
Remuneration for individual directors
In fiscal year 2024, the Remuneration Advisory committee met a total of eight times.
Group Governance
In order to increase the value of the entire Fujikura Group and achieve sustainable growth, we aim to establish frameworks and processes that enable Fujikura Group to come together and operate as if it were a single company, and to establish a system that allows the promotion and management of these processes to be effective and efficient.
Schematic Diagram of th group governance system
Skill Matrix for Directors and Executive Officer
(As of March 31, 2026)
- I = Information Infrastructure
- With optical wiring solutions based on innovative optical technology and future high-speed wireless communication technologies, we will contribute to building the information and communications infrastructure needed to realize a digital society.
- S = Information Storage
- Our unique electronic component technology and ultra-high density optical wiring technology contribute to the construction of high-capacity components and data center for storing massive amounts of data.
- T = Information Terminal
- With our high-precision electronic components and wiring/mounting technologies, we will contribute to the evolution of high-speed, large-capacity, and highly functional information terminals. We also consider automobiles to be information terminals, and will contribute to the realization and evolution of CASE.
- C = Carbon neutral
- Since carbon neutrality as an initiative to realize a sustainable society is also an opportunity to create businesses, we will promote the business of Fujikura's superconductivity technology and other technologies.
Policy for Determining Director Remuneration
The policy for determining the remuneration of directors who are not members of the Audit and Supervisory Committee and the determination of remuneration, etc., are composed of the Remuneration Advisory committee (Director in charge of Human Resources and three Outside Director, which is an advisory body to Board of Directors' Meeting, and the the chairperson of the committee is Outside Director. After the report, we will resolution it with Board of Directors' Meeting.
The contents of the Decision policy regarding the details of individual remuneration for directors are as follows.
Fujikura Group not only handles a wide variety of products, but also has a global business and a highly diverse board of directors. For this reason, based on the fact that the level of remuneration for directors is appropriate for an excellent human resource that can respond to these tasks, and based on the results of surveys conducted by multiple research agencies, mainly targeting listed companies, the remuneration of directors is composed of the following three categories. Based on objective indicators and evaluations, the remuneration system has been re-established to strengthen linkage to business performance.
In addition, it is expected that the maximum amount of compensation (short-term performance-linked compensation and stock-based compensation) that fluctuates depending on business performance and stock prices will be about 60% of the total compensation.
On the other hand, the remuneration of directors other than executive directors is limited to basic remuneration, which is a fixed amount in view of their roles, and short-term performance-linked remuneration and stock-based remuneration are not paid.
Determination of remuneration for Directors and Audit & Supervisory Committee Members policy and decisions on remuneration, etc. are fixed based on the market environment and in light of their duties, and the amount of remuneration, etc. for each Director Audit & Supervisory Committee Member is determined by consultation with the Directors and Audit & Supervisory Committee members within the limit of remuneration approval in the shareholders' meeting. The policy is determined by discussion among the Directors and Audit and Supervisory Committee members.
- Basic Remuneration
This portion corresponds to the monitoring and supervision function of directors and is set at a fixed amount according to position and grade.
- Short-term performance-linked Compensation
A basic amount will be set for each position and grade according to the company's overall performance or the performance unit in charge, and payment will be made within the range of 0% to 200% of the basic amount based on certain indicators (operating profit margin, return on equity (ROE), return on invested capital (ROIC)).
These indicators have been adopted because they are "indicators that easily reflect management policies," "indicators that have a strong correlation with the degree of profit return to shareholders," and "indicators that are highly compatible with Fujikura Group 's growth strategy."
The following two indicators are used as base values for the indicators related to "short-term performance-linked remuneration" for the business year under review.
① Consolidated fiscal year plan for the fiscal year ending March 2024, resolution by Board of Directors' Meeting at the end of the fiscal year ending March 2023
② Consolidated results for the fiscal year ending March 2023
The amount of short-term performance-linked remuneration to be paid for the current business year is determined by comparing the indicators calculated from these base values with the same indicators calculated from the consolidated fiscal year results for the fiscal year ending March 31, 2024, from the following two perspectives:
・Achievement rate against the consolidated fiscal year plan for the fiscal year ending March 2024 (corresponding base value: ① above)
・Degree of growth from the consolidated fiscal year results for the fiscal year ending March 2023 (corresponding base value: ② above) - Stock-Based Compensation
In addition to 1 and 2 above, Fujikura common stock will be issued as compensation to directors. The main purpose of this scheme is to increase directors' awareness of contributing to the improvement of corporate value by having them not only enjoy the benefits of rising stock prices but also bear the risk of falling stock prices, thereby sharing the benefits and risks of stock price fluctuations with shareholders.
In principle, the shares will be delivered when the directors who are not Audit and Supervisory Committee members retire.
Evaluation of the Effectiveness of Board of Directors' Meeting
- Improvements from fiscal 2023
Prior to fiscal year 2023, Fujikura evaluated the effectiveness of Board of Directors' Meeting through a questionnaire survey of all directors. However, in fiscal year 2023, with the aim of further improving effectiveness, Fujikura commissioned Board Advisors Co., Ltd., which has extensive knowledge and experience in evaluating the effectiveness Board of Directors' Meeting, to conduct an effectiveness evaluation through a questionnaire survey of all directors, interviews with all directors and Board of Directors' Meeting secretariat, review of minutes of Board of Directors' Meeting meetings, and attendance at Board of Directors' Meeting meetings.
Based on the issues identified in the effectiveness assessment, we have taken the following steps to improve the effectiveness of Board of Directors' Meeting.
① Sharing an understanding of the role of Board of Directors' Meeting
We discussed the roles that Board of Directors' Meeting should play and the scope of responsibilities of the Audit and Supervisory Committee which is responsible for oversight, in order to ensure that the directors shared a common understanding.
② Board of Directors' Meeting Agenda
We further revised the criteria for submitting matters to Board of Directors' Meeting and increased the emphasis on monitoring within Board of Directors' Meeting 's role.
③ Enhancement of Board of Directors' Meeting' Composition We have clarified the role of Board of Directors' Meeting appropriate for a sustainable growth phase, as well as the roles and expectations that should be placed on each director, and have proceeded with reviewing its composition.
④ Review of Board of Directors' Meeting operations: In particular, we expanded opportunities for prior explanations to Outside Director, aiming to improve the efficiency and effectiveness of deliberations at Board of Directors' Meeting.
- Implementation of the Fiscal 2024 Board of Directors' Meeting Effectiveness Evaluation and Results
In fiscal year 2024, Fujikura conducted a survey based on the results of the previous year, and commissioned Board Advisors Co., Ltd. to analyze and evaluate the results. The results are as follows:
① There was room for further expansion in discussions on important agenda items such as medium- to long-term strategy and non-financial themes.
② Several voices called for consideration of the ideal composition of Board of Directors' Meeting, the skills matrix, and the ratio of internal and external members.
③ Regarding "Contributions of Outside Director," it was evident that there is a need to clarify the roles expected of Outside Director in order to make the most of their qualifications.
④ Regarding committee, there was room for improvement in coordination with Board of Directors' Meeting and in agenda setting. - Future Initiatives
Based on the analysis and evaluation results, the challenges and future initiatives are as follows:
① Expanding discussions on important agenda items: Expanding discussions on medium- to long-term issues, non-financial matters, etc.
② Review of the composition Board of Directors' Meeting: Deepen discussions regarding the skills matrix for directors.
③ Demonstrating the Qualities of Outside Director: Clarifying the roles of Outside Director and ensuring their effectiveness.
Policy on Cross-Shareholdings
Fujikura says that it does not hold investment shares in principle policy. However, Fujikura will hold shares of the company as cross-shares only if it is necessary to enter into a cooperative relationship on a business strategy basis in the business conducted by Fujikura, and if such cooperation contributes to the enhancement of Fujikura's corporate value over the medium to long term. These cross-shareholdings will be positioned as part of the invested capital of each business units that conducts business, and will be verified as appropriate in accordance with the above policy holdings, and the Board of Directors' Meeting will decide whether to hold them. For shares that we decided not to hold, we report the progress of the sale to Board of Directors' Meeting. Based on the above policy, Fujikura has been actively selling its shares.
Changes in cross-shareholdings