For the purpose of securing further effectiveness and improving the functions of the Board of Directors, we
implement an effectiveness evaluation of the Board of Directors on an annual basis. Specifically, we conduct
a written and oral self-evaluation questionnaire survey of all the Directors and Auditors concerning the
effectiveness of the Board of Directors in terms of its structure, operation, agenda items, and the system
that supports it, as well as management strategies and challenges.
Based on the results of the survey, we share the evaluation results of the current situation and the
challenges with the Board of Directors and hold constructive discussions on future initiatives.
It has been evaluated that the expertise of External Directors and Auditors on the Board of Directors is
diverse and their respective insights enable constructive discussions. The Board holds sufficient
discussions on monitoring to formulate the Group’s annual policies and medium-term management plans, as
well as on important agenda items, such as M&As and alliances.
In the future, we will work to further improve the effectiveness of the Board of Directors by reviewing
the agendas at Board of Directors meetings further to increase the number of important agenda items, such
as healthcare, DX, overseas, ESG, capital cost, and the holding company’s functional enhancement and
organizational structure.
The increase in the number of External Directors and Auditors in FY2024 has led to greater diversity in terms of professional knowledge, experience and skills. The Board has maintained a structure consisting of individuals who can contribute to frank, active, and constructive discussions.
Board of Directors meetings are effectively and efficiently operated as any materials to be submitted
to the Board of Directors are sent in advance and important agenda items are explained beforehand to
board members.
Going forward, we will work to ensure there is time for deliberation in response to an increase in
important agenda items. We will do so by utilizing the Board of Executive Officers to distribute the
agenda items and generate time for substantive discussions. It is also essential to eliminate
information asymmetry by creating opportunities for management and external officers to develop a
deeper mutual understanding.
In terms of qualitative improvements to agenda items, they are selected appropriately based on a shift
toward management strategies aligned with the Company’s stage of development.
Going forward, in order to further enhance discussions of important agenda items, it is necessary to
set the agenda items in a timely and appropriate manner by reviewing the annual agenda of the Board of
Directors and prioritizing items based on urgency and importance.
Each officer is appropriately provided with the opportunity to request the necessary information from
the Company. These requests are carefully addressed by the executive branch and the secretariat.
To strengthen the system further, we will rebuild the internal control system to address business
expansion due to M&As, as well as improve the coordination of audits by the three parties—the internal
audit unit, the audit rm, and the Auditors—to make them more substantive.
The evaluation results show that each officer is appropriately fulfilling their role by actively
exchanging opinions with the executive branch and enhancing their supervisory functions based on their
own expertise and experience in areas such as healthcare, finance, overseas strategies, and global
governance. To facilitate more multifaceted discussions within the limited time for deliberation, we
will maintain a system in which Full-time Auditors actively voice their opinions during preliminary
stages, such as committee meetings and subsidiary board meetings, to complement their functions.
Going forward, we will contribute to improving the Board of Directors’ effectiveness by continuously
updating information through on-site inspections and training, as well as by constantly taking action
aimed at improvement and reform.
We highly value that in-depth discussions involving on-site managers are conducted during the
formulation of the new medium-term management plan and that the direction of medium- to long-term
strategies is presented.
Going forward, we will further enhance discussions on growth strategies with awareness of capital cost
and stock price, business portfolio rebalancing, management resource allocation (store, systems,
investment in human resources), and matters including healthcare, DX, overseas, and ESG.