Corporate Governance [PDF:1,526KB]

Directors, Audit and Supervisory Board Members, and Executive Officers

(Current as of June 22, 2022; number of shares held as of April 30, 2022)

Internal

Directors

Tadaaki Naito	Hitoshi Nagasawa
Chairman, Director	President, Representative Director,
Number of shares held: 46,014	President and Chief Executive Officer
Chairperson of the ESG Management Committee
Attendance at Board of Directors' meetings: 18/18
Number of shares held: 28,651
1978	Joined the Company	Attendance at Board of Directors' meetings: 18/18
2004	General Manager of Petroleum Group
1980	Joined the Company
2005	Corporate Officer
2004	General Manager of LNG Group
2007	Managing Corporate Officer
2007	Corporate Officer
2008	Director, Managing Corporate Officer
2009	Managing Corporate Officer
2009	Representative Director,
	Senior Managing Corporate Officer	2011	Director, Managing Corporate Officer
2013	Representative Director,	2013	Representative Director,
	Executive Vice-President Corporate Officer			Senior Managing Corporate Officer
2015	President, Representative Director,	2018	Representative Director,
	President Corporate Officer			Executive Vice-President Corporate Officer
2019	Chairman, Director, Chairman Corporate Officer	2019	President, Representative Director,
2020	Chairman, Director, Chairman and Executive Officer			President Corporate Officer
2020	President, Representative Director,
2022	Chairman, Director
		President and Chief Executive Officer

Hiroki Harada

Representative Director,

Senior Managing Executive Officer

Chief Executive of Liner & Logistics

Headquarters

Number of shares held: 7,649

Attendance at Board of Directors' meetings: 18/18

1983 Joined the Company

2011 General Manager of Tramp Co-ordination Group

2014 Corporate Officer

2018 Managing Corporate Officer

2019 Director, Senior Managing Corporate Officer

2020 Director, Senior Managing Executive Officer

2021 Representative Director, Senior Managing

Executive Officer

Executive Officers

Senior Managing Executive Officers

Tomoyuki Koyama

Akira Kono

Takaya Soga

Director, Senior Managing Executive Officer

Chief Financial Officer

Chief Executive of Management Planning

Headquarters

Number of shares held: 5,895

Attendance at Board of Directors' meetings: N/A

1984 Joined the Company

2010 General Manager of Automobile Logistics Group

2015 Corporate Officer

2018 Managing Corporate Officer

2020 Managing Executive Officer

2021 Senior Managing Executive Officer

2022 Director, Senior Managing Executive Officer

Audit and Supervisory Board Members

Noriko Miyamoto

Number of shares held: 13,405

Attendance at Board of Directors' meetings: 18/18 Attendance at Audit and Supervisory Board meetings: 18/18

1983 Joined the Company

2012 General Manager of IR Group

2014 Corporate Officer

2018 Managing Corporate Officer

2019 Audit and Supervisory Board Member

Yutaka Higurashi

Director, Senior Managing Executive Officer

Chief Compliance Officer

Chief Executive of General Affairs

Headquarters

Number of shares held: 7,114

Attendance at Board of Directors' meetings: 18/18

1985 Joined the Company

2014 General Manager of Legal Affairs Group

2016 Corporate Officer

2020 Managing Corporate Officer

2020 Director, Managing Executive Officer

2022 Director, Senior Managing Executive Officer

Eiichi Takahashi

Number of shares held: 40,580

Attendance at Board of Directors' meetings: 18/18 Attendance at Audit and Supervisory Board meetings: 11/11

1982 Joined the Company

2010 General Manager of Accounting Group

2012 Corporate Officer

2016 Director, Managing Corporate Officer

2018 Director, Senior Managing Corporate Officer

2019 Representative Director, Senior Managing Corporate Officer

2020 Representative Director, Senior Managing Executive Officer

2021 Audit and Supervisory Board Member

Note: Attendance by Eiichi Takahashi at meetings of the Audit and Supervisory Board is indicated from June 18, 2021, the date he assumed his current position.

Managing Executive Officers

Svein Steimler

Nobuhiro Kashima

Toru Kamiyama

Hiroshi Kubota

Yutaka Ikeda

Executive Officers

Hideki Suzuki

Yuko Tsutsui

Toru Maruyama

Hiroaki Nishiyama

Hisaya Higuchi

Hironobu Watanabe

Patrick Brennan Jr.

Kenichiro Sutoh

Yasunobu Suzuki

Yuji Nishijima

Takuji Banno

Toshi Nakamura

Keita Sataka

Masahiro Takahashi

Hiroaki Ohashi

Shinichi Yanagisawa

Shogo Terajima

Mie Sugano

Nippon Yusen Kabushiki Kaisha NYK Report 2022

58 - 59

Outside

Independent Outside Directors			Independent Outside Audit and
			Supervisory Board Members

Yoshihiro Katayama

Chief Independent Outside Director

Number of shares held: 19,080

Attendance at Board of Directors' meetings: 18/18

1974 Joined Japan's Ministry of Home Affairs

1998 Resigned from the ministry

1999 Governor of Tottori Prefecture

2007 Completed term as governor; Professor at Keio University

2010 Minister of Internal Affairs and Communications

2011 Resigned from the ministry

2016 Outside Director of NYK

2017 Retired from position as professor at Keio University

2017 Professor at Graduate School of Public Management, Waseda University

2019 Chief Independent Outside Director of NYK

2022 Retired as the Professor at Graduate School of Public Management, Waseda University

2022 Project Professor of Taisho University (current position)

Hiroshi Nakaso

Number of shares held: 308

Attendance at Board of Directors' meetings: 18/18 Attendance at Audit and Supervisory Board meetings: 18/18

1978 Joined the Bank of Japan

2003 Director-General of Financial Markets Department of the Bank of Japan

2008 Executive Director of the Bank of Japan

2013 Deputy Governor of the Bank of Japan

2018 Retired as Deputy Governor of the Bank of Japan

2018 Chairman of Daiwa Institute of Research Ltd. (current position)

2020 Independent Outside Audit and Supervisory Board Member of NYK

2021 Member of ABAC (Japan)

Hiroko Kuniya

Number of shares held: 7,307

Attendance at Board of Directors' meetings: 18/18

1981 Announcer and Writer for English-language

broadcasts of NHK General TV's "Seven O'clock News;" Researcher for "NHK Special" (NHK = Nippon Hoso Kyokai (Japan Broadcasting Corporation))

1987 Newscaster on NHK satellite broadcasting's "World News"

1993 Newscaster on NHK General TV's "Today's Close-Up"

2016 Trustee of Tokyo University of the Arts

(part-time; current position)

2017 Independent Outside Director of NYK

Eiichi Tanabe

Number of shares held: 2,388

Attendance at Board of Directors' meetings: 18/18

1978 Joined Mitsubishi Corporation

2008 Senior Vice President

2012 Executive Vice President

2016 Senior Executive Vice President, Corporate Functional Officer

2016 Representative Director, Senior Executive Vice President

2018 Retired from Mitsubishi Corporation, Advisor of Mitsubishi Corporation

2019 Independent Outside Director of NYK

2020 Retired as Advisor of Mitsubishi Corporation

Satoko Kuwabara

Number of shares held: 899

Attendance at Board of Directors' meetings: 18/18 Attendance at Audit and Supervisory Board meetings: 18/18

1990 Registered as Attorney-at-Law (Daini Tokyo Bar Association)

1990 Joined Mori Sogo

(currently Mori Hamada & Matsumoto)

1998 Partner of Mori Hamada & Matsumoto

2020 Resigned as Partner of Mori Hamada & Matsumoto

2020 Partner of Gaien Partners (current position)

2020 Independent Outside Audit and Supervisory Board Member of NYK

Message from an Outside Director

QInterview with an Outside Director:

What Are the Keys to Entrenching ESG Management in the NYK Group?

We asked Yoshihiro Katayama, who has been actively involved in changing the mindsets of organizations in his former capacities as Minister for Internal Affairs and Communications and the leader of a municipal authority, about his assessment of the NYK Group's ESG management and how he hopes it will develop going forward.

i n t e r v i e w

-What is your assessment of the effectiveness of ESG management in the NYK Group?

I have been very impressed by the real commitment with which the president and the senior management team are pursuing ESG management. In the period leading up to the formulation of the first iteration of the NYK Group ESG Story in 2021, I and all the outside directors occasionally made recommendations on ESG issues. They took it seriously and gave much thought to our recommendations. The period immediately after the issuance of the ESG Story saw the establishment of a system for driving ESG management forward, which includes the ESG Management Committee and ESG Navigators. These achievements are entirely attributable to the fact that, as a leader, President Hitoshi Nagasawa has a clearer vision than anyone of the form ESG management should take in the NYK Group.

Rather than simply summarizing initiatives that help address social issues, the

ESG Story reflects a series of rigorous in- house discussions on the nature of ESG yardsticks and the kind of value creation the Group should seek. The story is not a mere rallying cry for the integration of ESG principles into business management. It also places great emphasis on gaining the endorsement of each Group employee. In other words, the story is focused on creating a sense of ownership of ESG principles among employees.

The issuance of updated versions of the ESG Story in line with ESG manage- ment's progress in the Group shows the level of commitment to ESG management. In the latest version, the NYK Group ESG Story 2022, I am particularly interested in the NYK Group's unique approach to achieving net-zero emissions. I look forward to seeing how the Group progresses toward its goals of reducing GHG emissions by 30.0% by 2030, compared with fiscal 2015 levels, and achieving net-zero emissions from oceangoing shipping by 2050.

-The executive compensation system was revised in June 2022. What is the philosophy behind the revised system and what are its key features?

In 2016, the Company introduced a performance -based stock remuneration program with the aim of motivating management team members to contribute to sustained growth over the medium to long term by enabling them to share in profits with share- holders. With the Compensation Advisory Committee as the main forum for discus- sions, we have reformed the entire compensation system for directors, including the performance-based stock compensation program. In addition to conventional performance -linked indicators such as ROE and recurring profit, the new system incorporates "level of achievement of ESG indicators" as original components with a weighting of 20.0% among the portion related to stock remuneration. In today's world, corporate groups that generate large profits but

Nippon Yusen Kabushiki Kaisha NYK Report 2022		60 - 61

remain backward-looking on global issues such as climate change struggle to earn public trust. The introduction of ESG indicators in addition to short-term performance indicators has aligned the compensation system with the NYK Group's management strategies. Furthermore, we have incorporated the clawback provision into the compensation system to demonstrate both inside and outside the Group that misconduct will be dealt with severely and to further strengthen directors' sense of responsibility.

stakeholders involved in the Group's business activities, the need for further efforts to ensure rigorous compliance going forward must not be forgotten. For example, I believe that the NYK Group's in-house auditing functions is still need to be stronger. Although well developed, the Group's auditing system and structure are not very visi- ble. When working for a ministry and a municipal authority in the past, I shone spotlights on these types of behind-the- scenes organizations to generate wider interest in them. By doing so, motivation was greatly heightened. Making auditing activities and all other corporate divisional

activities more widely recognized, which should turn employees much more engaged. If the quality of management improves as a result, I believe that trust in the NYK Group will become even stronger.

As an outside director, I have long been cautious to view business management objectively. Though the discussion at the Board is always hot, it may turn inward- thinking easily. For precisely this reason,

I intend to be cool and objective to offer dispassionate recommendations and opinions.

-What changes do you hope
to see in the Group to
strengthen its management		I intend to be cool and
foundations?
To continue meeting the expectations of	objective to offer dispassionate
recommendations and opinions.
shareholders and investors and keeping
their trust, the NYK Group must hold the
reins in terms of rigorously ensuring com-
pliance and governance. The Group's viola-
tions of the Antimonopoly Act were one of
the reasons I was appointed as an outside
director. When approached about the posi-
tion, I was informed that an individual was
sought who would endeavor to prevent the
recurrence of such incidents and who	A
would conduct uncompromising checks
from an outside viewpoint to identify any
factors that could damage social credibility.
Since becoming an outside director, I have
repeatedly told employees through training
sessions about the various accidents and
violations that have occurred in the past.
Given the extremely wide range of Group
companies, business partners, and other
Profile
Yoshihiro Katayama
Independent Outside Director
Chief Outside Director

i n t e r v i e w

Business Overview

Liner & Logistics Headquarters

We will maximize corporate value by continuing to strengthen the advantages of our business companies so that they are fully prepared when conditions normalize.

Hiroki Harada

Representative Director,

Senior Managing Executive Officer

Chief Executive of Liner & Logistics

Headquarters

Business Model of the Liner & Logistics	Logistics Center Locations (as of March 31, 2022)
Business

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n i d l o H (

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r e t r a u q d a e H

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c i t s i g o L

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Liner Trade	Ocean Network Express Pte. Ltd.	Europe (20 countries)	East Asia (4 countries)	Americas (6 countries)
(Ownership ratio 38%)	Logistics centers: 124	Logistics centers: 86
		Warehouses: 76	Warehouses:40	Logistics centers:73
		744,000 m2	225,000m2	Warehouses:40
	Container terminals			433,000 m2
	business
	Harbor transport services			Japan
			Logistics centers: 87
				Warehouses : 26
				175,000 m2
	Tugboat operations

			South Asia/Oceania (16 countries)		Number of employees: 25,123
Air Cargo	Nippon Cargo Airlines
	Logistics centers: 269		Number of countries: 47
Co., Ltd. (NCA)
Transportation	(Ownership ratio 100%)		Warehouses: 178		Number of logistics centers: 639
			1,115,000 m2		Number of warehouses: 360
	Yusen Logistics Co., Ltd.
Logistics				Total floor area of warehouses: 2,693,000 m2
and others

(Ownership ratio 100%)

Liner Trade:

Business Summary, Risks

and Opportunities, and Challenges

NYK's founding business and now part of Ocean Network Express Pte. Ltd. (ONE), which was established by integrating the liner trade businesses of NYK and two other Japanese shipping companies

World's sixth-largest fleet, with a series of new ships scheduled to be delivered from mid-fiscal 2022 onward

Although not stable, the business model has good growth potential going forward

Air Cargo Transportation:

Business Summary, Risks

and Opportunities, and Challenges

Engaged in transportation of international air cargo conducted by wholly owned subsidiary NCA

In light of the business improvement order received in 2018, reshaped its systems and regenerated profits

Value reaffirmation of dedicated cargo aircraft recognized since the COVID-19 pandemic

Logistics Business:

Business Summary, Risks

and Opportunities, and Challenges

Wide range of forwarding services catered to customers' various value chains by wholly owned subsidiary YLK

New competitive environment due to the participation by major European container shipping companies

Pursuit of M&As with the aims of expanding scale of business and filling gaps for growth by region, business, or customer demand