The next focusIR Investor Webinar takes places on 14th May with guest speakers from WS Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.

Less Ads, More Data, More Tools Register for FREE

Pin to quick picksMEL.L Regulatory News (MEL)

  • There is currently no data for MEL

Watchlists are a member only feature

Login to your account

Alerts are a premium feature

Login to your account

Statement re (Compensation Scheme)

1 Jun 2022 10:00

RNS Number : 5506N
Mitsubishi Electric Corporation
01 June 2022
 

 

FOR IMMEDIATE RELEASE

No. 3528

 

 

 

Media Inquiries

 

Public Relations Division

Mitsubishi Electric Corporation

prd.gnews@nk.MitsubishiElectric.co.jp

www.MitsubishiElectric.com/news/

 

Notice of Revised Compensation Scheme for the Company's Executive Officers

 

TOKYO, May 25, 2022 - Mitsubishi Electric Corporation (TOKYO Prime Market: 6503) announced today that the Compensation Committee, at its meeting held on May 25, 2022, decided to revise the compensation scheme for the Company's Executive Officers and to apply the revised scheme from fiscal 2023, as follows:

 

1. Purpose of the Revision

The Company has introduced a performance-based compensation scheme, including stock compensation, for its Executive Officers to increase their awareness of the necessity to contribute to enhancing the medium- to long-term corporate value of the Group and to share that value with shareholders. However, we have decided to revise the entire compensation structure for our Executive Officers effective from the fiscal year 2023 to further clarify the roles and responsibilities of Directors and Executive Officers and to more rigorously evaluate their short-, medium-, and long-term incentive compensation based on the achievement level of the performance indices.

The key points of the new compensation scheme for the Company's Executive Officers are as follows:

 

- Revised its compensation scheme to make it more performance-linked to implement and achieve the key indicators and priority measures outlined in the Medium-Term Management Plan.

- In addition to rigorously evaluating the achievement of the performance indices in the business units in charge, greater emphasis on incentive compensation to reflect performance indices in non-financial matters, such as restoring public trust, improving employee engagement, and sustainability and ESG-related progresses.

- Revised the stock compensation portion of the compensation scheme and established new stock ownership guidelines to strengthen incentives to sustainably increase corporate value and shareholder value over the medium- to long-term.

- Improved compensation governance by introducing malus and clawback provisions.

 

2. Outline of Compensation Scheme for Executive Officers

(1) Compensation levels and structure

The compensation levels and structure shall be established by selecting a group of major Japanese manufacturing companies that are similar to the Company in terms of size, business type, global expansion, etc. as the compensation benchmark companies and by considering the trends in compensation levels at the benchmark companies, our management strategy and business environment, the objectives of incentive compensation and the degree of difficulty in achieving the targets, the roles and responsibilities of the Executive Officers concerned, and other relevant factors. In addition, to ensure that compensation, etc. focuses on improving corporate and shareholder value over the medium to long term, the following compensation structure shall be adopted.

 

Please refer to Figure1 in the attached

http://www.rns-pdf.londonstockexchange.com/rns/5506N_1-2022-6-1.pdf

 

(i) Basic compensation

Fixed compensation is set in accordance with the roles and responsibilities of each Executive Officer and is paid monthly in cash by dividing the position-based annual standard amount by 12.

 

(ii) Performance-based bonus

The bonus payment shall be determined by "Corporate Performance Evaluation" and "Individual Evaluation." The payment amount will fluctuate in the range of 0% to 200% depending on the evaluation results. The amount to be paid to each individual shall be calculated as below and paid in a lump sum in cash after the end of each fiscal year.

Individual payment amount = Position-based standard amount x (Corporate performance evaluation coefficient + Individual evaluation coefficient) (in the range of 0-200%)

 

■Evaluation Indicators, Ratios, and Targets for FY2022

Evaluation indicators

Evaluation ratios

Targets, etc.

President & CEO

Other Executive Officers

Corporate results

Consolidated revenue

35%

25%

Maximum

5,250 billion yen

Target

4,770 billion yen

Minimum (Threshold)

4,530 billion yen

Consolidated

Operating profit ratio

35%

25%

Maximum

7.5%

Target

5.7%

Minimum (Threshold)

5.1%

Individual evaluation

30%

50%

Set specific targets for each Executive Officer based on the priority measures in FY2026 Medium-Term Management Plan, "Three Reforms" to restore trust, ESG challenges, and performance of the business unit in charge.

 

 

Please refer to Figure2 in the attached

http://www.rns-pdf.londonstockexchange.com/rns/5506N_1-2022-6-1.pdf

 

 

■Determination of individual evaluation coefficients

The targets for the President and CEO shall be determined through the deliberation of the Compensation Committee at the beginning of the fiscal year. Evaluations shall be made after the end of the fiscal year, by deliberation and decision by the Compensation Committee following a self-evaluation by the President and CEO.

Goals and evaluations of other Executive Officers are discussed and approved by the Compensation Committee after a meeting between the President and CEO and each Executive Officer.

 

(iii) Performance-based stock compensation (Performance Share Units (PSU))

In principle, the number of shares to be issued as performance-based stock compensation (PSU) varies between 0% and 200%, depending on the comparison result (in percentile) between the Company's TSR (total shareholder return) for the three years and the TSR of a pre-selected group of comparable companies. The comparable companies are selected from domestic and overseas companies in the business areas in which the Company operates. The number of shares to be delivered to each individual is calculated as follows:

Number of shares delivery to each individual Standard PSU points for the position × PSU grant rate (0-200%)

 

Please refer to Figure3 in the attached

http://www.rns-pdf.londonstockexchange.com/rns/5506N_1-2022-6-1.pdf

 

(iv) Restricted Stock Units (RSU)

In order to promote continuous shareholding and shareholder value during the term of office, the Restricted Stock Unit (RSU) program shall, in principle, deliver shares, with transfer restrictions, equivalent to the standard amount for the position at the end of each fiscal year. The transfer restrictions shall be lifted at retirement (when the Company's Director or Executive Officer retires from his/her position).

 

(2) Stock ownership guidelines

We believe it is important to ensure that our Executive Officers share the same value with our shareholders on a long-term and sustainable basis. To this end, we have established the following stock ownership guidelines and require Executive Officers to continuously hold the Company's stock during their term of office, even after the target amount has been reached.

 

 [Stock Ownership Guidelines]

Targeted holdings to be achieved within four years of assuming the position

Position

Target amount

President & CEO

The multiple to be applied to the annual basic compensation

1.3 times

Senior Vice President

1.0 times

Executive Officer

0.8 times

 

(3) Malus and clawback provisions

The Company shall introduce "malus and clawback provisions" so that, in the event of any material misconduct or violation by an Executive Officer, or in the event of any material revision to the financial results of prior fiscal years, the Compensation Committee may, by resolution, demand that such Executive Officer forfeit his/her right to receive incentive compensation (malus) or return his/her paid compensation (clawback). The compensation that may be subject to these provisions shall be performance-based bonuses to be paid or already paid, points granted before the delivery of shares and shares before the lifting of transfer restrictions, and some or all of the shares already delivered.

http://www.rns-pdf.londonstockexchange.com/rns/5506N_2-2022-6-1.pdf

 

###

 

About Mitsubishi Electric Corporation

With more than 100 years of experience in providing reliable, high-quality products, Mitsubishi Electric Corporation (TOKYO: 6503) is a recognized world leader in the manufacture, marketing and sales of electrical and electronic equipment used in information processing and communications, space development and satellite communications, consumer electronics, industrial technology, energy, transportation and building equipment. Mitsubishi Electric enriches society with technology in the spirit of its "Changes for the Better." The company recorded a revenue of 4,476.7 billion yen (U.S.$ 36.7 billion*) in the fiscal year ended March 31, 2022. For more information, please visit www.MitsubishiElectric.com

*U.S. dollar amounts are translated from yen at the rate of ¥ 122=U.S.$1, the approximate rate on the Tokyo Foreign Exchange Market on March 31, 2022

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
 
END
 
 
STRUAOWRUUUNRRR
Date   Source Headline
1st Dec 202110:46 amRNSStatement re (Temporarily Suspended ISO9001)
25th Nov 20217:00 amRNSStatement re (Listing TSE’s New Prime Market)
9th Nov 20217:00 amRNSStatement re (ISO9001 Temporarily Suspended)
4th Nov 20217:00 amRNSStatement re (Status of Company Stock Repurchase)
28th Oct 20217:00 amRNSHalf-year Report
20th Oct 202110:38 amRNSStatement re (Governance Review Committee)
18th Oct 202111:59 amRNSStatement re (Building Systems Business)
5th Oct 20217:17 amRNSStatement re (Status of Company Stock Repurchase)
1st Oct 20219:47 amRNSStatement re (Investigation into QC practices)
1st Oct 20219:45 amRNSStatement re (Results of the Investigation)
1st Oct 20219:45 amRNSStatement re (Transfer of a Director)
22nd Sep 202110:15 amRNSStatement re (Partial Withdrawal of ISO9001)
22nd Sep 20219:06 amRNSDividend Declaration
17th Sep 202110:56 amRNSStatement re (Withdrawal of ISO 9001, IRIS)
3rd Sep 20217:02 amRNSStatement re (Status of Company Stock Repurchase)
3rd Sep 20217:00 amRNSStatement re (Voltage Circuit Breakers Inspection)
24th Aug 20217:00 amRNSStatement re (ISO9001 Temporarily Suspended)
20th Aug 202110:03 amRNSStatement re (Improper Testing of Switchgear)
4th Aug 20217:47 amRNSStatement re (Repurchase of Company Shares)
3rd Aug 202111:03 amRNSStatement re (Temporarily Suspended ISO9001 etc.)
29th Jul 20217:00 amRNS1st Quarter Results
28th Jul 20217:00 amRNSStatement re (Replacement of President & CEO etc.)
26th Jul 202110:13 amRNSStatement re (Members of Investigative Committee)
8th Jul 202111:29 amRNSStatement re (Moves to Reform its Quality Culture)
8th Jul 202110:35 amRNSStatement re Moves to Reform its Quality Culture
8th Jul 202110:28 amRNSStatement re (Improper Testing of HVAC etc.)
5th Jul 20217:10 amRNSStatement re (Status of Company Stock Repurchase)
3rd Jun 20217:00 amRNSStatement re (Repurchase of Company Shares)
28th Apr 20217:00 amRNSStatement re (Director Candidates)
28th Apr 20217:00 amRNSStatement re (Difference)
28th Apr 20217:00 amRNSFinal Results
24th Mar 20218:47 amRNSDividend Declaration
18th Feb 20217:00 amRNSChanges in Executive Officers, Directors and Org.
2nd Feb 20217:00 amRNS3rd Quarter Results
29th Oct 20207:00 amRNSHalf-year Report
25th Sep 20209:16 amRNSDividend Declaration
30th Jul 20207:00 amRNS1st Quarter Results
1st Jun 20207:00 amRNSStatement re (Additional Disclosure of Forecast)
11th May 202010:35 amRNSFinal Results
28th Apr 20207:00 amRNSStatement re (Director Candidates)
25th Mar 20207:56 amRNSDividend Declaration
3rd Feb 20209:45 amRNS3rd Quarter Results
3rd Feb 20207:00 amRNS3rd Quarter Results
31st Oct 20197:00 amRNSHalf-year Report
24th Sep 20197:14 amRNSDividend Declaration
5th Aug 20199:04 amRNSStatement re (Comments on KFTC Announcement)
30th Jul 20197:00 amRNS1st Quarter Results
26th Apr 20197:00 amRNSFinal Results
25th Mar 20197:00 amRNSDividend Declaration
4th Feb 20197:00 amRNS3rd Quarter Results

Due to London Stock Exchange licensing terms, we stipulate that you must be a private investor. We apologise for the inconvenience.

To access our Live RNS you must confirm you are a private investor by using the button below.

Login to your account

Don't have an account? Click here to register.

Quickpicks are a member only feature

Login to your account

Don't have an account? Click here to register.