Sustainability

Directors and Audit & Supervisory Board Members

Standard and Policy for Independence of Outside Directors
and Outside Audit & Supervisory Board Members

Outside Directors

In addition to the requirements for an outside director under the Companies Act and for an independent director specified by the Tokyo Stock Exchange, NGK may not designate a person who falls under any of the following items as an outside director with independence (hereinafter referred to as the “Independent Outside Director”); provided, however, that if NGK considers that such person, who falls under any of the items, is appropriate as the Independent Outside Director of NGK in light of such person’s personality, insight, etc., NGK may designate said person as an Independent Outside Director on the condition that said person satisfies the requirements for an outside director under the Companies Act and for an independent director specified by the Tokyo Stock Exchange as well as on the condition that NGK externally explains the reason why such person is appropriate as the Independent Outside Director of NGK.
In these independence standards, a person who executes business refers to an executive director, executive officer, corporate officer, manager, or other employee, and NGK Group refers to NGK or NGK’s subsidiaries or affiliated companies.

  • A major shareholder who holds 10% or more of the current voting rights of NGK. If such major shareholder is a corporation, a person who has executed the business of said corporation during the last three fiscal years including the most recent fiscal year.
  • A person who currently executes the business of a business partner where the amount of transactions between NGK Group in any of the last three fiscal years including the most recent fiscal year is 2% or more of the consolidated sales of either said business partner or NGK Group.
  • A person who has executed the business of a financial institution or other corporation that is a major creditor, which is indispensable for NGK Group’s fundraising and on which NGK Group depends to the extent that it is irreplaceable, in the past three fiscal years including the most recent fiscal year.
  • An incumbent director or officer of an organization that receives a donation or grant from NGK Group in the amount exceeding ¥10 million per year or 30% of average annual total expenses of such organization, whichever the greater, in any of the last three fiscal years including the most recent fiscal year.
  • A certified public accountant, tax accountant or an incumbent employee of an auditing firm or tax accounting firm who served as an accounting auditor or accounting advisor of NGK Group in the past three fiscal years including the most recent fiscal year.
  • A person who is a lawyer, certified public accountant, tax accountant, or other consultant who does not correspond to any of the individuals mentioned in 5. above and who, in addition to his/her remuneration as an officer, has received cash and other property benefits of ¥10 million or more per year from the NGK Group in the past three fiscal years including the most recent fiscal year, or an incumbent employee, etc., of a law firm, auditing firm, tax accounting firm, consulting firm, or other advisory firm that does not correspond to any of the firms mentioned in 5. above, which received a payment of more than 2% of its annual consolidated gross sales from NGK Group in any of the last three fiscal years including the most recent fiscal year.
  • A person who has executed the business of a company, of which NGK is currently a major shareholder, in the last three fiscal years including the most recent fiscal year.
  • Relatives within the second degree of kinship to a person who falls under the items 1 to 7 above.

Outside Audit & Supervisory Board Members

In order to ensure that outside Audit & Supervisory Board Members are impartial and that there is no conflict of interest with shareholders, NGK makes comprehensive decisions based on the Securities Listing Regulations of the Tokyo Stock Exchange.

Reasons for Appointment of Outside Directors
and Outside Audit & Supervisory Board Members

Outside Directors

Name Reasons for appointment
Hiroyuki Kamano Having long engaged in legal practice as an attorney-at-law, Mr. Kamano possesses a wealth of experience and achievements in the legal community, including his service as Vice President of the Tokyo Bar Association. He has been utilizing his expertise, abundant experience, and wide range of insights and appropriately fulfilling his duties as an outside director of NGK, by giving his opinion mainly on the level of permeation of the NGK Group Philosophy, strengthening the compliance structure, and defining the grounds for business judgments, as well as offering suggestions to NGK’s business operation and properly overseeing the management of NGK. Therefore, NGK appointed him as outside director.
Mr. Kamano holds 1,000 shares of NGK stock. However, apart from this, he has no personal, financial, or important business relationship with, nor other vested interest in, NGK.
Concurrent with his work with NGK, Mr. Kamano serves in a variety of roles, including as an outside auditor of House Foods Group Inc. and as an outside director of Spancrete Corporation. However, no personal, financial, or important business relationship, nor other vested interest, exits between NGK and the organizations with which Mr. Kamano currently works.
Emiko Hamada Ms. Hamada has made remarkable achievements such as leading the invention and the world’s first commercialization of the CD-R (recordable CD) while working for Taiyo Yuden Co., Ltd. Since then, she has been engaged in research activities mainly through industry-academia-government collaborations as Professor at Nagoya Institute of Technology and Visiting Professor at Nagoya University. By utilizing the insights she has developed through her career, she has been appropriately fulfilling her duties as an outside director of NGK by giving her opinion mainly on strengthening technical capabilities and the current state of quality management, as well as offering suggestions to NGK’s business operation and overseeing the management of NGK. Therefore, NGK appointed her as outside director.
Ms. Hamada holds 5,000 shares of NGK stock. However, apart from this, she has no personal, financial, or important business relationship with, nor other vested interest in, NGK.
Concurrent with her work with NGK, Ms. Hamada serves in a variety of roles, including as a third-area program officer for the Japan Science and Technology Agency’s A-STEP program, as a part-time lecturer at NITech, and as an outside director for Taiyo Yuden. However, no personal, financial, or important business relationship, nor other vested interest, exits between NGK and the organizations with which Ms. Hamada currently works.
Kazuo Furukawa Mr. Furukawa has extensive knowledge of technical fields including information and telecommunications, as well as experience leading large organizations, through his work in important positions at Hitachi Ltd. such as President & Chief Executive Officer of the Information & Telecommunication Systems Group and subsequently President, as well as Chairman of the New Energy and Industrial Technology Development Organization. He has been utilizing his knowledge and experience and appropriately fulfilling his duties as an outside director of NGK, by giving his opinion on a wide range of topics regarding all aspects of NGK’s business activities, as well as offering suggestions to NGK’s business operation and overseeing the management of NGK. Therefore, NGK appointed him as outside director.
Mr. Furukawa holds 5,000 shares of NGK stock. However, apart from this, he has no personal, financial, or important business relationship with, nor other vested interest in, NGK.
Concurrent with his work with NGK, Mr. Furukawa serves in a variety of roles, including as an outside director (Audit & Supervisory Committee member) for the Pasona Group Inc. However, no personal, financial, or important business relationship, nor other vested interest, exits between NGK and the organizations with which Mr. Furukawa currently works.

Outside Audit & Supervisory Board Members

Name Reasons for appointment
Junichi Itoh Mr. Itoh has been involved with corporate management for many years, including as Senior Management Executive Officer for the Bank of Tokyo-Mitsubishi UFJ, Ltd. (now MUFG Bank, Ltd.) and Representative Director, Senior Executive Vice President and CFO for Nikon Corporation. As an expert in corporate management, Mr. Itoh is able to leverage the wealth of experience and the insights he has cultivated over his long career to provide appropriate advice and oversight aimed at strengthening NGK’s corporate governance. Based upon this demonstrated competency and capability, he has been selected as an outside audit & supervisory board member.
Mr. Itoh has no personal, financial or important business relationship with, nor other vested interest in, NGK.
Mr. Itoh comes from the Bank of Tokyo-Mitsubishi UFJ (now MUFG Bank), which is an NGK shareholder and with which NGK has financial transactions, including lending money to NGK at the end of the fiscal year under review. However, given such considerations as the significant amount of time that has passed since Mr. Itoh stepped down as senior managing executive officer of the Bank of Tokyo-Mitsubishi UFJ (now MUFG Bank), we do not believe his decisions are affected by the wishes of MUFG Bank in any way that would constitute a conflict of interest with our general shareholders.
Mr. Itoh serves concurrently as an outside director (Audit & Supervisory Committee member) of Hyakujushi Bank, from which NGK receives financing; however, NGK has business transactions with numerous financial institutions, and the nature of the financing secured from Hyakujushi Bank is not such that NGK is any way beholden to it. Therefore, we deem the financial borrowing relationship between NGK and Hyakujushi Bank to be one which would not impact NGK’s management decision-making and, thus, does not create a conflict of interest with our general shareholders. Apart from this, no personal, financial, or important business relationship, nor other vested interest, exits between NGK and the organizations with which Mr. Itoh currently works.
Masayoshi Sakaguchi Mr. Sakaguchi has a wealth of experience in the administrative sector and a proven track record in managing large organizations. He was commissioner of the Osaka Prefectural Police, chief of the Commissioner-General’s Secretariat (National Police Agency), and commissioner-general of the National Police Agency. Making use of this experience, he audits NGK’s overall management from the viewpoint of the legality of business and risk management, thus helping raise NGK’s corporate value. We have therefore elected him to the position of outside audit & supervisory board members.
Mr. Sakaguchi has no personal, financial, or important business relationship with, nor other vested interest in, NGK.
Mr. Sakaguchi has served as special advisor to Nippon Life Insurance Company, which is both an NGK shareholder and a source of financing for NGK. However, as of the end of the fiscal year under review, Nippon Life Insurance Company’s holdings did not exceed more than 1.36% of total NGK shares, and, with regard to the financing received, NGK has business transactions with numerous financial institutions, and the nature of the financing secured from Nippon Life Insurance Company is not such that NGK is any way beholden to it. Therefore, we deem the shareholder and financial borrowing relationship between NGK and Nippon Life Insurance Company to be one which would not impact NGK’s management decision-making and, thus, does not create a conflict of interest with our general shareholders.
Concurrent with his work with NGK, Mr. Sakaguchi serves in a variety of roles, including as vice president of the Japan Automobile Federation. However, no personal, financial, or important business relationship, nor other vested interest, exits between NGK and the organizations with which Mr. Sakaguchi currently works.

We have submitted written notification to the Tokyo Stock Exchange and Nagoya Stock Exchange of the appointment as independent directors of the above five individuals.