Corporate Management

SoftBank Group Corp.("SBG")'s corporate governance system centers on the Board of Directors, Audit & Supervisory Board Members, and the Audit & Supervisory Board. Five of the 9 Board Directors are External Board Directors (4 of whom are Independent External Board Directors) to ensure robust mutual monitoring between the Board Directors. Likewise, and a majority of the members of the Nominating & Compensation Committee, which is a voluntary advisory body to the Board of Directors, are Independent External Board Directors to ensure objectivity and transparency concerning the election, dismissal and compensation of Board Directors. Furthermore, all of the four Audit & Supervisory Board Members are External Audit & Supervisory Board Members to ensure independent auditing functions, thereby strengthening the monitoring of management. In addition, as part of its continued efforts to strengthen its corporate governance, SBG made changes to its Board of Directors and appointed Corporate Officers in November 2020, in its aim to separate the management decision-making function from the business execution function to clarify the persons responsible for business execution.

In order to realize our corporate philosophy of “Information Revolution – Happiness for everyone, the executive compensation policy of SBG is decided bya resolution of the Board of Directors, accounting for the societal and relative status of each officer, as well as the degree of their respective contributions to SBG, while referring to compensation survey results conducted by professional organizations, so that the system provides compensation that is reasonably competitive and can attract global talent that share the same aspirations. Individual amount of compensation is determined pursuant to the procedure described in “Organization and procedures for deciding executive compensation” below.

For Board Directors whose main duties are as officers of subsidiaries and group companies, compensation is determined by respecting the compensation policy of each company, based on the “Cluster of No. 1 Strategy” for us to grow together through the bond of camaraderie, and such compensation is paid by subsidiaries and group companies.

Total compensation paid to Board Directors (excluding External Board Directors) comprises basic compensation, which is fixed compensation, and performance-based compensation, which changes depending on the performance. The performance-based compensation comprises cash bonuses as an incentive for short-term performance and stock compensation (non-monetary compensation) as an incentive to improve our corporate value over the mid-to-long term, and their proportion is determined individually.

The compensation for External Board Directors and Audit & Supervisory Board Members consists exclusively of fixed compensation because they are independent of business execution.

Basic compensation is set as an annual amount on an individual basis, and is paid in cash in monthly installments. The amount of compensation is decided on an individual basis taking into consideration whether the officer is full-time and part-time, as well as their positions and the duties they are in charge of.

Cash bonuses as an incentive for short-term performance are paid every fiscal year, as compensation for the execution of duties while executive officers are in office.

Stock compensation (non-monetary compensation) as an incentive to improve corporate value over the mid-to-long term, is provided in the form of stock options using stock acquisition rights, with an aim to encourage executives to make continuous management effort, while sharing mutual interest with shareholders through share price increase. The contents of stock acquisition rights include normal stock options (with exercise price calculated based on the market price at the time of allotment) and share-based stock options (with exercise price of ¥1). The exercisable period will be set within the range of 10 years from the day following their allotment date.

The amount of cash bonuses and the number of stock acquisition rights allotted as stock compensation are decided based on multiple performance indicators for adequately rewarding the results achieved through business activities. Specifically, it is decided on an individual basis, and shall take into consideration individual performance based on each officer’s ability and achievements, as well as company performance including consolidated results, the stock price and NAV (Net Asset Value).

[Key performance indicators as basis for performance-based compensation (for cash the fiscal year ended March 31, 2023)]

Executive compensation is paid within the range of the aggregate amount of compensation approved by the resolution of the General Meeting of Shareholders, subject to confirmation that it is in line with the SBG compensation policy stated in “Overview of the executive compensation system” above and is found to be both rational and reasonable.

Regarding the range of the aggregate amount of compensation, the monetary compensation and the stock compensation paid to Board Directors were resolved at an amount not exceeding ¥5 billion per year, respectively, at the 38th Annual General Meeting of Shareholders held on June 20, 2018, and SBG was served by 12 Board Directors (including three External Directors) at the time of the resolution. The compensation paid to Audit & Supervisory Board Members was resolved at an amount not exceeding ¥160 million per year at the 41st Annual General Meeting of Shareholders held on June 23, 2021, and SBG was served by four Audit & Supervisory Board Members (including four External Audit & Supervisory Board Members) at the time of the resolution.

Compensation of Board Directors for this fiscal year has been decided by Representative Director, Corporate Officer, Chairman & CEO (Masayoshi Son) who is the founder of SBG responsible for the business results of SBG as a whole, based on the contents of discussions by the Nominating & Compensation Committee, which is a voluntary advisory body to the Board of Directors, within the range of authority entrusted to him by the resolution of the Board of Directors following the Annual General Meeting of Shareholders for the previous fiscal year. The SBG Nominating & Compensation Committee shall review the proposed compensation from multiple viewpoints including the consistency with the SBG compensation policy and make a report to the Board of Directors on its deliberation details. The Board of Directors decides that the deliberations are in line with the SBG compensation policy.

To ensure independence, compensation of the Audit & Supervisory Board Members for this fiscal year shall be decided by the consultation among the Audit & Supervisory Board Members, after the conclusion of the Annual General Meeting of Shareholders for the previous fiscal year.