Remuneration for Member of the Board of Directors

Policies regarding remuneration

With respect to remuneration for Member of the Board of Directors, Murata Manufacturing Co., Ltd. makes it a basic policy to provide a system and level of remuneration that is considered suitable for executive-level managers of a globally competitive electronic equipment and component manufacturer in order to ensure recruitment of human talent considered to be excellent based on a comparison with same-industry competitors, to raise the morale and motivation to improve financial results, and to contribute to the maximization of corporate value.

Remuneration for Member of the Board of Directors who are not Audit and Supervisory Committee Members is made up of (i) monthly remuneration, (ii) bonus with the aim of giving a short-term incentive, and (iii) share-based remuneration with the aim of making them share values with shareholders over the long term and increasing their motivation to contribute toward sustainable growth in corporate value by giving a medium- to long-term incentive.
The level and percentage of each type of remuneration are determined mainly based on benchmarking results with companies in similar industries or sizes in order to ensure that the remuneration is suitable for executive-level managers of a globally competitive electronic equipment and component manufacturer.
The composition ratio of these types of remuneration is largely as follows:

  • (i) Monthly remuneration: 52%-56%
  • (ii) Bonus: 26%-31%
  • (iii) Share-based remuneration: 16%-18%

The remuneration paid to Outside Directors who are independent from business execution (excluding Members of the Board of Directors who are Audit and Supervisory Committee Members) is only monthly remuneration, and is determined mainly based on benchmarking results with companies in similar industries or sizes.

Procedures for determining remuneration

The Remuneration Advisory Committee deliberates on the remuneration system and levels for Member of the Board of Directors and reports its findings to the Board of Directors. The Board of Directors decides on the standards regarding remuneration for Member of the Board of Directors based on the report from the Remuneration Advisory Committee.

Specific remuneration amounts are calculated in accordance with the remuneration standards. Individual remuneration of Members of the Board of Directors who are not Audit and Supervisory Committee Members is decided by the Remuneration Advisory Committee and individual remuneration of Members of the Board of Directors who are Audit and Supervisory Committee Members is decided by discussion with the Audit and Supervisory Committee.

Procedures for determining remuneration
  • (Notes)

    1. The above figures for total amount of compensation, etc. and number of persons are indicated for each director category taken into account of two Members of the Board of Directors who are not Audit and Supervisory Committee Members who retired, one Member of the Board of Directors who is an Audit and Supervisory Committee Member who retired, one Member of the Board of Directors who is not an Audit and Supervisory Committee Member who resigned and assumed office as Member of the Board of Directors who is an Audit and Supervisory Committee Member, and one Member of the Board of Directors who is an Audit and Supervisory Committee Member who resigned and assumed office as a Member of the Board of Directors who is not an Audit and Supervisory Committee Member during the fiscal year ended March 31, 2021.

  • 2. Out of the total shown above, total compensation, etc., provided to nine Outside Directors, is 78 million yen (only monthly remuneration).

(i) Monthly remuneration:
The monthly remuneration is a fixed remuneration of an amount individually decided for each Member of the Board of Directors based on a fixed amount for service as Member of the Board of Directors, and an amount that is decided based on consideration of the level of importance of each Member of the Board of Directors’ business execution allocation and responsibility and the previous fiscal year’s financial performance.

(ii) Bonus:
The total amount of bonus is decided according to the Company’s financial performance, and the amount allocated to each Member of the Board of Directors is decided by giving consideration to the level of contribution to financial performance of each individual. The indicator used as a standard for bonus calculation is consolidated operating income per person after deducting capital cost, which measures the growth and productivity increase of the corporation. The bonus is calculated by adjusting a reference amount for each position based on this indicator. As for the timing of payments, the bonus is paid in two installments, once during a fiscal year and once after the end of fiscal year.

(iii) Share-based remuneration:
Restricted share remuneration is introduced to improve corporate value in the medium to long term. The reference amount is set by position of each Member of the Board of Directors, and shares are allotted every July. Upon an eligible Member of the Board’s retirement from both positions of Member of the Board of Directors and Vice President due to term expiration, compulsory retirement age, etc., transfer restrictions on the allotted shares are lifted.


Table of contents

Overview of Murata's Corporate Governance System

  • Structure of corporate governance system
  • Composition of the Board of Directors, etc.

History of initiatives to strengthen corporate governance

  • History of initiatives to strengthen corporate governance
  • Changes in the number of the Members of the Board of Directors

Nomination of candidates for Members of the Board of Directors

  • Nomination policies
  • Nomination procedures
  • Executives

Remuneration for Member of the Board of Directors

  • Policies regarding remuneration
  • Procedures for determining remuneration