Corporate Governance Policy

This Policy establishes the basic views, framework and operational policy regarding corporate governance of the Sompo Group (hereinafter “the Group”).

1. Basic Views on Corporate Governance

SOMPO Group aims to serve diverse stakeholders and work to address various social challenges through each business based on SOMPO’s Purpose (For a future of health, wellbeing and financial protection) to enhance enterprise value.
Sompo Holdings, as the holding company of all Group companies, considers continuous improvement of transparency and fairness of the Group’s corporate governance and fulfillment of corporate social responsibility through business as essential for maintaining strong relations of trust with stakeholders. The Board of Directors has accordingly established this Policy to clarify basic policies regarding the overall vision for the governance structure and the development of governance framework. We continue to make efforts to enhance corporate governance in pursuit of the best corporate governance.

2. Overall Governance Structure

Sompo Holdings, Inc. (hereinafter “the Company”) has changed its governance structure to "Company with committees", effective June 2019, as part of efforts to strengthen corporate governance structure by separating management supervision from business execution in order to reinforce the supervisory function of the Board of Directors and to accelerate business execution by delegating substantial authorities from the Board of Directors to executive functions. The Company also established three committees; Nomination Committee, Audit Committee, and Compensation Committee and established a governance structure that works to improve transparency and fairness. The Board of Directors sets the basic policies for Group management and for internal control which forms the foundation of Group management, appoints Executive Officers and Senior Vice Presidents, and supervises the performance of duties by Directors and Executive Officers. The Board of Directors also delegates executive decisions to Executive Officers in principle, as far as the laws permit, to further strengthen the supervisory function of the Board of Directors and accelerate business execution.
In addition, by appropriately executing the duties of the Nominating Committee, Audit Committee, and Compensation Committee, which have the Chairman and a majority of its members as Outside Directors, the Company ensures transparency in the appointment of Directors, Executive Officers, and Senior Vice Presidents, the audit of their duties, and the compensation of Directors, Executive Officers and Vice Presidents to develop and maintain the structure for enhanced functioning of corporate governance.
On the structure for business execution, the Executive Officer and Executive Vice President make executive decisions and perform duties on the matters delegated from the Board of Directors under the overall supervision of the Group CEO, while the Business CEO System by which the Business CEO is appointed and the Executive Vice President in charge of the business segment pursues sustainable enhancement of enterprise value and maximization of synergies within the Group under the oversight of the Business CEO, and Group CxO System by which the Group Chief Officer (hereinafter “Group CxO”) utilizes high level of expertise in respective functional area across businesses and pursues Group best, are in place to ensure agile and flexible decision-making and business execution, with clearly defined authorities and responsibilities.
Also, the Company established the Group Executive Committee which is an advisory body to the Group CEO to discuss important matters that significantly impact management, such as Group management strategy and business executive policy.

3. Board of Directors and Committees

(1) Directors and the Board of Directors

(i) Role of Directors and the Board of Directors
The Board of Directors performs its duties as stipulated by laws and regulations or the Articles of Incorporation, decides on important items for management as defined in the Rules of Board of Directors, and serves a supervisory function overseeing the status of business execution.
The Chairman of the Board of Directors is assumed by the Director appointed at the Board of Directors Meeting as stipulated in the Articles of Incorporation.
Prior to the Board of Directors Meeting, preliminary briefing sessions are held for Outside Directors before every meeting to explain about the agenda items. The opinions, questions, and other comments expressed by the Outside Directors at the preliminary briefing sessions are shared with all attending Directors before the Board of Directors Meeting, to operate the Board of Directors Meeting and preliminary briefing session in a unified manner. Additionally, executive functions and the secretariat of the Board of Directors Meeting provide information as necessary. Such procedures facilitate constructive and productive discussion at the Board of Directors Meeting and ensure the effectiveness of the operations of Board of Directors Meeting. In addition, Outside Directors and the Group CEO hold meeting to facilitate open exchange of opinions among Outside Directors and between the top Executive Officers.

(ii)Number, structure and tenure of Directors
The number of Directors shall not exceed 15 (fifteen) as stipulated in the Articles of Incorporation, considering the need for appropriate decision making and the scope of responsibilities and duties of the Board of Directors. Outside Directors shall be selected in accordance with the policies for appointment of Directors and Executive Officers from corporate executives, academic experts, and legal professionals or individuals who have expert knowledge of finance and accounting, etc., in order to incorporate wider perspectives from outside with respect to issues, such as corporate governance, consumer affairs and overseas business operation. The tenure of Directors ends upon the closing of the final General Shareholders Meeting held within a fiscal year that is within one year from the appointment in order to clarify the responsibilities of the management concerning the fiscal year

(2) Nomination Committee

(i)Role of the Committee
The Nomination Committee defines policy and standard for the appointment of Directors, Executive Officers, Senior Vice Presidents, and Special Advisors, determines the list of candidates, and involve in the appointment of Directors, Senior Vice Presidents and Special Advisors of subsidiaries when necessary according to the profile and size of the business.
In addition, the Nomination Committee deliberates appointment and dismissal of the Group CEO based on the personal performance evaluation to improve transparency and corporate governance.

(ii)Structure of the Committee
The Nomination Committee consists of at least 3 (three) members and the majority of the members are selected from Outside Directors to ensure independence and neutrality of the Committee. The Chairman of the Committee is selected from a member who is an Outside Director.

(3) Audit Committee

(i)Role of the Committee
The Audit Committee shall audit the legality and the appropriateness of the duty performance of Directors and Executive Officers, produce audit reports, and determine agenda to be presented to the General Shareholders Meeting regarding the appointment, dismissal and non-reappointment of the Independent Auditor.
In addition, the Audit Committee exercises its right to consent to the determination of compensation for the Independent Auditor.
The Audit Committee establishes the audit standards, basic audit policy, and audit plans to ensure effectiveness of the aforementioned audit practice and carries out audit in an organized manner.

(ii)Structure of the Committee
The Audit Committee consists of at least 3 (three) members selected from the Directors who do not assume any executive role, and the majority of the members shall be Outside Directors.
In addition, the Chairman of the Committee is selected from the members who are Outside Directors in principle with more than one full-time audit member who is familiar with the business of the Group and audit member who has expert knowledge of finance and accounting in principle.

(iii)Ensuring effectiveness of the Committee
An organization dedicated to supporting the duties of the Audit Committee is established.
In addition, the Audit Committee and the Internal Audit Department cooperate closely with each other and share information appropriately, and the Audit Committee provides consent to internal audit plan and personnel affairs related to the General Manager of the Internal Audit Department.

(4) Compensation Committee

(i)Role of the Committee
The Compensation Committee determines the evaluation of Directors, Executive Officers, and Senior Vice Presidents, and compensation scheme and compensations of Directors, Senior Officers, Senior Vice Presidents, and Special Advisors, and involve in the compensations of Directors, Senior Vice Presidents and Special Advisors of subsidiaries when necessary according to the profile and the size of the business.
In addition, the Compensation Committee performs personal performance evaluation of the Group CEO to enhance transparency and objectivity of the compensation determination process and improve corporate governance.

(ii)Structure of the Committee
The Committee consists of at least 3 (three) members selected from Directors and the majority of the members are selected from Outside Directors in order to ensure independence and neutrality of the Committee. The Chairman of the Committee is selected from a member who is an Outside Director.

4. Business Executive Structure and Executive Officers

At the Company, Executive Officers shall make executive decisions on matters delegated by the Board of Directors and execute business under the overall supervision of the Group CEO. Also, the Group introduced the Business CEO System and Group CxO System in order to perform agile and flexible decision-making and business execution in the Group's best interest with the objective of enhancing enterprise value of the Group.

(1)Executive Officers and Senior Vice Presidents

Executive Officers shall make executive decisions on matters delegated by the Board of Directors and execute business, and within the scope of duties in accordance with laws and regulations or the Articles of Incorporation, internal rules, etc., execute business based on management strategy of the Group. Senior Vice Presidents execute business following a partial delegation of business execution authority from Executive Officers.

(2)Group CEO

As the Chief Executive Officer of the Group, the Group CEO oversees the overall management of the Group by strategically assigning the Business CEOs who are the heads of each business unit, Executive Vice President in charge of business segments, and Group CxOs who are the heads of each function of the Group to realize agile and flexible Group management in response to discontinuous changes in business environment.

(3) Business CEO

The Sompo P&C CEO and Sompo Wellbeing CEO are appointed as heads of each business unit and are partially delegated authority from the Group CEO to formulate business strategy and oversee investment decision-making in each business unit to maximize enterprise value.

(4) Executive Vice President of business segment

The Executive Vice President in charge of the Domestic P&C Insurance Business, Overseas Insurance and Reinsurance Business, Domestic Life Insurance Business, and Nursing Care Business are appointed as heads of each business segment and execute strategies, make investment decisions, allocate headcount, etc. in an agile and timely manner while ensuring financial soundness of each business segment under the oversight of the Business CEO.

(5) Group CxO

The Group CxOs as heads of each function in the Group (Group CFO (finance), Group CHRO (human resource), Group CDO (digital), Group CRO (risk management), Group CSuO (sustainability), Group CDaO (data), Group CIO (IT), Group CAE (internal audit), etc.) oversee Group-wide operation of each function to enable agile and flexible decision-making and Group-wide business execution in the Group's best interest.

(6) Group ExCo

Group ExCo as an advisory body to the Group CEO and executive committee, discusses themes that significantly impact group-wide management strategy and business executive policy.
The Group ExCo is chaired by the Group CEO and is comprised of the Business CEOs, Executive Vice Presidents of business segments, Group CxOs, Executive Officers in charge of specific areas, etc.

5. Policies for Appointment of Directors and Executive Officers

The appointment of Directors and Executive Officers is conducted in accordance with the following policies for appointment of Directors and Executive Officers. The candidates for Directors selected by the Nomination Committee are approved at the General Shareholders Meeting, and the candidates for Executive Officers are selected by the Nomination Committee and approved by the Board of Directors.

(1) Policies for appointment of Directors

The Company supervises and guides its subsidiaries, formulates management strategy for the Group that encompasses management strategies for subsidiaries that are engaged in the P&C insurance business and other various businesses, and is responsible for ensuring the execution and realization of these strategies.
From this perspective, the Board of Directors selects Outside Directors to facilitate objective decision-making with respect to management issues from a diverse and independent viewpoint and perspective with consideration of diversity such as gender and nationalities, and the majority of the Board of Directors consists of Outside Directors.
Directors are appointed based on: I. Selection criteria that reflect the Comprehensive Guidelines for Supervision of Insurance Companies; and II. Their alignment with SOMPO's values (Integrity, Self-motivation, and Diversity), which serve as the foundation for decisions and actions to achieve SOMPO's Purpose. Outside Directors are selected based on I. "Ability Requirements", II. "Standards regarding Independence of Outside Directors", and III. "Requirements for Terms of Office".
For the purpose of carrying out substantive discussions, the number of Directors shall be limited to 15 (fifteen) in accordance with the Articles of Incorporation.
Note: In this policy, gender refers to all gender-related events, knowledge, and values, including the existence of the gender division of labor and LGBTQ+.

ⅠAbility RequirementsThe Company selects Outside Directors from corporate executives, academic experts, and legal professionals who have a wide range of knowledge and experiences in various fields or individuals who have expert knowledge of finance and accounting.
In addition, the appointment shall require him/her to be in a position where he/she is able to devote the time and effort necessary to fulfill the role and responsibilities of Director appropriately.

ⅡStandards regarding Independence of Outside Directors
The Company will determine the independence from the Company of Outside Directors based on the matters set forth below:

A．Personal Relationships: A kinship between the candidate and any officer or employee of the Group, status of mutual appointments of officers between the Company and the company which the candidate is originally from.

B．Capital Relationships: The holding of shares in the Company by the candidate and the status of shareholding by the Group.

C．Business Relationships: Business transactions or donations between the Group and the candidate.

D．Significant interests other than the above.

In the event that a candidate for Outside Director falls within any of the categories listed below, the Nomination Committee, a committee primarily constituted of Outside Directors, will examine his/her independence. Following the final determination by the Board of Directors, the proposal for appointment will be submitted to the General Meeting of Stockholders of the Company and the Company will submit notification of such Outside Director as an independent director as prescribed by each Financial Instruments Exchange.

A．Personal Relationships

(a)The candidate is or was Executive Director (Note 1), Executive Officer, Senior Vice President or an employee of the Company or its subsidiary at present or in the past 10 years (in 10 years prior to his/her appointment if the candidate was a Non-Executive Director or Audit & Supervisory Board Member).

(b)The candidate is a relative (Note 3) of a person who is or was Executive Director, Executive Officer, Senior Vice President or an important employee (Note 2) of the Company or its subsidiary at present or in the past 5 years.

(c)The candidate is Director, Audit & Supervisory Board Member, Accounting Advisor, Executive Officer or Senior Vice President of (i) a company that accepts Director(s) (full-time or independent) from the Company or its subsidiary, (ii) its parent company or (iii) its subsidiary.

B．Capital Relationships

(a) The candidate is Director, Audit & Supervisory Board Member, Accounting Advisor, Executive Officer, Senior Vice President or an employee of a company in which the Company owns 10% or more of the voting rights.

(b) The candidate is a relative of a person who is Director, Audit & Supervisory Board Member, Accounting Advisor, Executive Officer or Senior Vice President of a company in which the Company owns 10% or more of the voting rights.

(c) The candidate owns or owned 10% or more of the voting rights of the Company at present or in the past five years (if the shareholder is a corporation, the candidate is or was Director, Audit & Supervisory Board Member, Accounting Advisor, Executive Officer, Board Member, Senior Vice President or an employee of the subject company, its parent company or a significant subsidiary (Note 4) of the subject company).

(d) The candidate is a relative of a person who owns or owned 10% or more of the voting rights of the Company at present or in the past five years (if the shareholder is a corporation, the candidate is a relative of the person who is or was Director, Audit & Supervisory Board Member, Accounting Advisor, Executive Officer, Board Member, Senior Vice President of the subject company).

C．Business Relationships

(a) The candidate is a person who makes or made payments of 2% or more of the Company’s consolidated gross annual sales (based on the current fiscal year or the average of the past three fiscal years) to the Company or its subsidiary (if the payer is a corporation, the candidate is or was Executive Director, Executive Officer, Senior Vice President or an employee of the subject company, its parent company or a significant subsidiary) or a relative of the person.

(b) The candidate is a person who receives or received payments of 2% or more of the candidate’s consolidated gross annual sales (based on the current fiscal year or the average of the past three fiscal years) from the Company or its subsidiary (if the recipient is a corporation, the candidate is or was Executive Director, Executive Officer, Senior Vice President or an employee of the subject company, its parent company or a significant subsidiary) or a relative of the person.

(c) The candidate is a Board Member (should be limited to a person who executes business) or other member or his/her relative, who executes business of a public interest incorporated foundation, a public interest incorporated association, or a non-profit corporation, etc. who receives donations or grants exceeding 10 million yen per year based on the average of the past three fiscal years from the Company or its subsidiaries.

(d) The candidate is Director, Audit & Supervisory Board Member, Accounting Advisor, Executive Officer, Senior Vice President or an employee or his/her relative of (i) a financial institution, (ii) other large creditor, (iii) its parent company or (iv) a significant subsidiary, from which the Company obtains or has obtained financing (the financing is indispensable, which the Company depends on to the extent that such financing has little or no substitute) at present or in the past three years.

(e) The candidate is an employee, a partner or a staff member of a certified public accountant (or a tax accountant) or an audit corporation (or a tax accounting corporation), who serves as an accounting auditor of the Company or its subsidiary, or a person who was any of the above in the past three years, and who actually is or was engaged in auditing (excluding supplementary involvement) for the Company or its subsidiary (including those who are currently retired).

(f) The candidate is a relative of (i) a certified public accountant (or a tax accountant) or (ii) an employee or a partner of an audit corporation (or a tax accounting corporation), who serves as an accounting auditor of the Company or its subsidiary.

(g) The candidate is a relative of a staff member of a certified public accountant (or a tax accountant) or an audit corporation (or a tax accounting corporation), who serves as an accounting auditor of the Company or its subsidiary, and who actually is engaged in auditing (excluding supplementary involvement) for the Company or its subsidiary, or a person who was an employee, a partner or a staff member of a certified public accountant (or a tax accountant) or an audit corporation (or a tax accounting corporation), who served as an accounting auditor of the Company or its subsidiary, in the past three years, and who actually was engaged in auditing (excluding supplementary involvement) for the Company or its subsidiary during the subject period of time.

(h) The candidate is a consultant such as an attorney or a certified public accountant other than the above (e) who receives financial or other property benefits of 10 million yen or more per year (based on the average of the past three years) exclusive of officer’s compensation, and a person who is and was an employee, a partner, an associate or a staff member or his/her relative of a consulting firm or other specialized advisory firm such as a legal office or an audit corporation other than the above 5), who received payments of 2% or more of the firm’s consolidated gross annual sales (based on the average of the past three fiscal years) from the Company or its subsidiary.

D．Significant Interests

A person who can be recognized to have significant interests other than the above (a) through (c).

Notes:

1. “Executive Director” means the Director as set forth in each item of Article 363, Paragraph 1 of the Companies Act and other Directors who executed business of the subject company (the same applies to the following).

2. “Important employee” means a person who falls under the “important employee” as set forth in Article 362, Paragraph 4, Item 3 of the Companies Act (the same applies to the following).

3. “Relative” refers to a spouse, a relative within the second degree of kinship or a relative who lives together (the same applies to the following).

4. “Significant subsidiary” refers to a subsidiary that is described as a significant subsidiary in (i) the items of e.g., “Status of Significant Parent Company and Subsidiaries” in the business reports associated with the subject company’s most recent fiscal year (Article 120, Paragraph 1, Item 7 of the Ordinance for Enforcement of the Companies Act), or other materials that are generally published by the subject company (the same applies to the following).

5. The past tense as described in the above B. (c) and (d), and C. (a), (b) and (h) (e.g., a person who “was”) refers to within the past five years.

Ⅲ. Requirements for Terms of Office
If the total terms of office as Outside Director or Outside Audit & Supervisory Board Member of the Company exceeds eight years, the Company will carefully consider whether there are any positive reasons for reappointment, and if there are any reasons, the Company shall not preclude reappointment.

(2) Policies for the composition and criteria for appointment and removal of Executive Officers and Senior Vice Presidents

Ⅰ.Policies for the composition of Executive Officers and Senior Vice Presidents
The Company implements systematic development of managerial talent based on the succession plan. As for the composition of Executive Officers and Senior Vice Presidents as a whole, the Company places emphasis on diversity including gender, age, experience, and nationalities as well as the balance in the management team.

Ⅱ.Criteria for appointment and removal of Executive Officers and Senior Vice Presidents
The Company appoints Executive Vice Presidents and Executive Officers, and Executive Vice Presidents who meet the following criteria and who can promote these values throughout the organization through talent development and other initiatives.

Always think and do what is right for people and society.
Continuously create value for people and society by thinking and acting with a long-term perspective.
Think proactively based on your aspirations and actively embrace challenges.
Possess strong expertise in your assigned mission and roles, supported by proven experience and accomplishments.
Act simply and quickly; stay ahead of change to drive transformation.
Embrace diversity, respect others, and remain open to different opinions.
Strive to engage in constructive dialogues that foster candid exchanges of opinions to create value.
Actively collaborate across organizations and companies to maximize the value provided.

The Board shall consider the removal of any Executive Vice President and Executive Officer, and Executive Vice President who is determined to lack the requisite qualifications in connection with the foregoing.

6. Policies for Training of Directors and Executive Officers

To facilitate a deeper understanding of the business environment surrounding the Company, training is provided for newly appointed Outside Directors on the current state of the Company and the P&C insurance industry, risk management, overseas businesses, life insurance business, and nursing care business. Outside Directors also continue to deepen their understanding of business in a practical manner through various opportunities to communicate with executive functions.
Also, executive study sessions are held regularly for Executive Officers and Senior Vice Presidents to acquire knowledge outside the areas of their responsibilities and training is undertaken through participation in seminars and executive training provided by various associations and organizations.
In addition to the aforementioned training, education programs are offered to develop executive mindset and leadership skills in collaboration with outside specialized companies to educate the next generation executives.

7. Policies for Determining Compensation for Directors and Executive Officers

The Company regards compensation for Directors and Executive Officers as important matter from the viewpoints of improving business performance and corporate value, and sets policies for determining compensation for Directors and Executive Officers as follows:

(1) Basic concept of Compensation for Directors and Executive Officers (Group-wide policy)

The Company’s Purpose is “For a future of health, wellbeing, and financial protection.” To embody this purpose, it defines the expected behaviors based on SOMPO’s Values (Integrity, Self-motivation, and Diversity) as the foundation for the decisions and actions of executives and employees.
Executives are expected to lead by example. Therefore, their compensation is determined based on the following principles:

(i)The compensation system should create sustainable value for stakeholders over the medium to long term.

(ii)The level and system of compensation ensures acquisition and retention of top talent as management of the Group.

(iii)Compensation shall be determined in accordance with the magnitude of the mission with a forward-looking mindset and accomplishments. Additionally, fixed factors associated with specific job title or position may be taken into consideration.

(ⅳ)The compensation system for Directors, Executive Officers and Vice Presidents shall be consistent with business strategy and heightens the Directors’, Executive Officers’ and Vice Presidents’ awareness of performance improvement for the Group's growth.

(v)Compensation shall reflect medium to long-term results and initiatives of Directors, Executive Officers and Vice Presidents, not just performance in a single fiscal year.

(ⅵ)The compensation system of the Company and major subsidiaries shall have objectivity, transparency and fairness to fulfill accountability to stakeholders through the deliberation process at the Compensation Committee of the Company.

(2) Compensation system for Directors and Executive Officers

The following is applied to the Company’s compensation system for Directors and Executive Officers. However, in case there is a justifiable reason for not applying the following, the amount and composition of compensation are determined individually by the Compensation Committee.

(i)Composition and determination method of Directors’ compensation

Compensation for Directors shall consist of monthly compensation, performance-linked compensation and stock price-linked compensation. With regard to monthly compensation, performance-linked compensation and stock price-linked compensation, fixed amount shall be determined for monthly compensation, while a base amount and the number of base point (one unit = cash equivalent to one common share of the Company) shall be determined for performance-linked compensation and stock price-linked compensation, depending on whether the Director is an Outside Director or not, and whether the Director is a full-time or a part-time Director.
However, performance-linked compensation and stock price-linked compensation are not paid to non-executive Directors.
Any Director who also serves as an Executive Officer shall be paid with the sum of the compensation for Director and the compensation for Executive Officer.
The overview of the performance-linked compensation and stock price-linked compensation is described below in (iii) and (iv).

(ii)Composition and determination method of Executive Officers’ and Senior Vice Presidents’ compensation

Compensation of Executive Officers and Senior Vice Presidents shall consist of monthly compensation, performance-linked compensation and stock price-linked compensation. The amount and composition of compensation of Executive Officers and Senior Vice Presidents are determined based on the business environment and market average executive compensation, reflecting the magnitude of the mission.
Additionally, fixed amount shall be determined for monthly compensation, while base amount and the number of base point (one unit = cash equivalent to one common share of the Company) shall be determined for performance-linked compensation and stock price-linked compensation.
The overview of the performance-linked compensation and stock price-linked compensation is described below in (iii) and (iv).

(iii)Performance-linked compensation

The Company has introduced performance-linked compensation system to align compensation for Directors and Executive Officers and business strategy and heighten the Directors’ and Executive Officers’ awareness of performance improvement for the Group’s growth. The overview of the system is described below.

Performance-linked compensation shall be determined by reflecting the degree of achievement of financial target and strategic target for a single fiscal year in the base amount of performance-linked compensation.
The base amount of performance-linked compensation is defined as the amount to be paid when financial target and strategic target are achieved. This base amount is determined individually for each Director and Executive Officer.
Performance-linked compensation consists of financial performance-linked compensation and strategic performance-linked compensation, and the allocation ratio of each base amount is determined by the Compensation Committee in accordance with the nature of the mission of each Director and Executive Officer.
Performance indicators that are applied to financial target are adjusted consolidated ROE and others for the fiscal year and the coefficient is determined according to the actual figures vs. target figures (numerical target in business plan).
Performance indicators that are applied to strategic target are the indicators agreed by the Group CEO, Business CEO or other Director, Executive Officer or Vice President responsible for evaluation in accordance with the mission of each Director, Executive Officer and Vice President, and the coefficient is determined according to the degree of the achievement.

(iv)Stock price-linked compensation system

The Company has introduced a stock price-linked compensation system that provides the same economic value as actual shares in order to motivate directors to continuously improve the Company's corporate value and to promote value sharing between directors and shareholders. The outline of this system is as follows:

Stock price-linked compensation reflects an amount equal to the Company's stock price and dividends in the number of units granted. The number of units will be determined by reflecting the level of achievement of strategic goals in the base amount of stock-linked compensation, which is determined based on the size of the mission, etc.
The units granted will vest at the end of the fiscal year three years after the date of grant, and the vested units will be classified as PS (i) and PS (ii).
Directors may exercise their rights at any time with respect to PS (i) and only upon retirement with respect to PS (ii), and the amount to be paid will be calculated by multiplying the number of units exercised by the Company's share price at the time of exercise and adding an amount equivalent to the dividends accumulated up to the time of exercise.

8. Information Disclosure

The Company fulfills accountability to stakeholders through timely, appropriate, fair and accurate disclosure of financial as well as non-financial information, including management strategies and issues, risks, and governance. Disclosure systems, including internal rules, shall be established to accurately and promptly provide required information.

9. Policies for Managing Group Companies

To increase the Group’s corporate value, the Company supervises the businesses of the entire Group with the Business CEO System and Group CxO System. For this, the Company establishes structures, including internal rules, to appropriately manage Group companies. The Company formulates SOMPO’s purpose and basic policies for the Group and notifies these to Group companies as well as appropriately manages Group companies through monitoring and other means. The Company also establishes appropriate systems, including risk management system, regulatory compliance system, conflict of interest management system, customer information management system, and internal audit system, to ensure effectiveness of internal control system of Group companies.
Group companies shall adhere to basic policies of the Group and formulate business plans based on SOMPO’s purpose.