Evaluating Effectiveness of Board Meetings

The Board of Directors and the Nominating  Committee analyze and evaluate the effectiveness  of the entire Board of Directors based on the results  of an evaluation questionnaire that is given to each  director.

Before presenting a list of director candidates to  the General Meeting of Shareholders held in June  2018, a questionnaire was given to each director  between December 2017 and January 2018 in order  to evaluate the Board of Directors. Based on the  questionnaire’s results, the Nominating Committee  and the Board analyzed and evaluated the  effectiveness of the entire Board. A summary of said  results is shown on the right.

Summary of the Analysis and Evaluation

No issues concerning the size of the Board  of Directors (9 directors including 6 outside  directors) were identified. No other particular
issues were found with respect to the diversity of  expertise and experience in the directors. However, with regard to the necessary knowledge and abilities for the board of directors, it was recognized that it is necessary to consider changing or adding members to the Board of Directors, with an aim for the inclusion of younger generations and technology-related knowledge.

Remuneration System of Officers

Monex has adopted a corporate committee structure, like the Nominating Committee. The Compensation Committee - chaired by an outside and independent director - decides on the policy related to the compensation and also on the specific compensation for each director and executive officer.


For this policy, directors who do not also fill executive posts are independent from business execution. Since the position focuses on the oversight of management, the remuneration for directors, etc., shall only be basic remuneration on a fixed pay scale that is equivalent to the duties.
On the other hand, remuneration for executives, including those who fulfill dual roles as directors, is composed of basic remuneration plus a short-term incentive and a medium-and-long term incentive.


Basic remuneration consists of a fixed amount plus an amount concomitant to the post. Short term incentive remuneration shall be an incentive for improving performance during a single fiscal year. The total amount of the incentive shall be determined by the company’s performance and then shall be allocated based on merit for the duties and performance of each director. The medium-and-long term incentive remuneration shall be an incentive for improving the corporate value over the medium to long terms, and shall be allocated to each director in shares restricted on transfer (or “restricted stock”). (*)


There are two reasons for adopting the medium- and-long term incentive remuneration. One is to accommodate a request for incentives so that the company’s performance over the medium to long term is reflected in the remuneration of management per the Corporate Governance Code. Two, by including remuneration based on stock that is restricted on transfer during a certain time period and by keeping eligible directors on the same page as shareholders with regard to the fluctuation of the share price, this type of incentive system can reinforce an executive’s ongoing commitment toward improving the corporate value over the medium to long term.


* In lieu of allocating shares restricted on transfer to directors who reside outside of Japan for medium- and long-term incentive remuneration, phantom stock shall be allocated in accordance with the laws of the country of residence and distributed proportionally over multiple fiscal years in order to have an equivalent effect to shares restricted on transfer. The amount paid shall be calculated from the standard stock price of the Company.

Remuneration system for executive officers/ directors and executive officers (average)

Basic Remuneration Fixed remuneration Approx. 70% of total
remuneration
Short-Term Incentive
Remuneration
Remuneration linked
to each year’s performance
Approx. 30% of total
Medium-and-Long
Term Incentive Remuneration
Restricted stock linked
to the price of the Group’s stock

Reasons for Appointing Directors

Experience and Expertise

Based on our nominating policy that assumes high ethical standards and a good understanding of one’s duties,  each director offers one or multiple fields of experience and expertise that qualify him or her as a director.

Experience and Expertise

Reasons for Appointing Internal Directors

Name Position Reason for Appointment
Oki Matsumoto Managing Director,
Chairman of the Board,
Member of the Nominating Committee,
Member of the Compensation Committee,
Representative Executive Officer,
Chief Executive Officer
Since Mr. Matsumoto founded the former Monex, Inc. in 1999, he has been dedicated to creating and establishing a new financial business model in Japan, i.e., an online brokerage business for retail investors, and has demonstrated strong leadership in expanding the businesses of Monex Group, Inc. and the group companies. With his in-depth understanding of the financial services industry, Mr. Matsumoto has actively supported substantive and productive discussion of the Board. As Chief Executive Officer of the Company, he deploys his exceptional leadership and management skills to drive the “New Beginning” phase, in which the Company aims to achieve new growth in the group’s business.
Shoji Kuwashima Managing Director,
Managing Director, Vice Chairman of the Board Executive Officer and Chief Quality Officer
Mr. Kuwashima has long experience in the Japanese brokerage business and has in-depth knowledge in information technology. He proactively participates in Board discussions with well-balanced perspectives derived from his vast experience in management. Mr. Kuwashima also serves as an Executive Officer of the Company and is responsible for taking information securities measures, etc. where his knowledge and experience in IT security can be fully utilized.
Takashi Oyagi Managing Director,
Executive Officer and Chief Strategic Officer
Mr. Oyagi is a founding member of Monex, Inc., which was established in April 1999. With his long experience in financial services in Japan and the U.S., Mr. Oyagi has, while fulfilling his responsibilities as Director, assumed the role of planning strategies as well as the role of managing the business of the Company’s U.S. segment as its Executive Officer. Mr. Oyagi actively participates in Board discussions, providing his views reflecting changes in the U.S. financial industry and new business opportunities.

Reasons for Appointing Outside Directors & Attendance Record

Name Current Positions Reason for Appointment Attendance Record for FYE March 2020
Jun Makihara
*1
Outside Director, Member of the Nominating Committee,
Member (Chair) of the Compensation Committee, Lead Independent Director
Mr. Makihara’s years of experience in investment banking and in the incubation of Internet business start-ups in Japan and the U.S. provides him with strong expertise in financial services and profound understanding of the financial services industry as well as Internet-related businesses. Mr. Makihara has contributed to the Board since he was elected as Director of the Company in June 2006, expressing perspectives that take the financial services environment within Japan and overseas into consideration.
Since being appointed as the Lead Independent Director in April 2015, Mr. Makihara has not only actively participated in Board discussions, but also contributed to facilitating communication between the Outside Directors and management, by such means as holding meetings attended only by the Outside Directors and the CEO.
Board of Directors 11/11 times
Nominating Committee 3/3 times
Compensation Committee 10/10 times
Nobuyuki Idei Outside Director, Member (Chair) of the Nominating Committee,
Member of the Compensation Committee
Mr. Idei has extensive management experience in global companies and is aggressively engaged in nurturing next-generation businesses and leaders, drawing on his extensive connections around the world as well as his in-depth knowledge of online businesses. Since his appointment as Director of the Company in June 2013, Mr. Idei has contributed to the Board by actively expressing his perspectives derived from broad knowledge and experience of new business within Japan and overseas. Board of Directors 11/11 times
Nominating Committee 3/3 times
Compensation Committee 10/10 times
Fujiyo Ishiguro Outside Director, Member of the Nominating Committee Ms. Ishiguro has profound knowledge of digital marketing and long experience in management as an active CEO of a listed company. Since June 2014, when she was elected as Director of the Company, Ms. Ishiguro has actively participated in Board discussions by leveraging her knowledge to express far-sighted views of such matters as approaches to customer service in an increasingly digitized environment. Board of Directors 11/11 times
Nominating Committee 3/3 times
Nobuo Domae Outside Director, Member of the Nominating Committee
Member of the Audit Committee
Mr. Domae has experience of both online and physical consumer retail business development and growth within Japan and overseas. Furthermore, he has long and in-depth extensive experience in establishing globally applicable organizational frameworks and business management systems and internal control systems. Since he was elected as Director of the Company in June 2016, Mr. Domae has aggressively participated in Board discussions and provided his insights from the perspectives of both risk management and the pursuit of opportunities for business growth. Board of Directors 11/11 times
Nominating Committee 3/3 times
Compensation Committee 11/11 times
Masaaki Koizumi Outside Director, Member (Chair) of the Audit Committee Mr. Koizumi is a certified public accountant in Japan and has an ample knowledge as an expert in finance and accounting. The Nominating Committee determined that Mr. Koizumi’s extensive experience in conducting external accounting audits of companies, including financial institutions, and the same in engaging in the process of companies going public would enhance the board governance of the Company. Board of Directors 11/11 times
Compensation Committee 11/11 times
Shiho Konno Outside Director, Member of the Audit Committee Ms. Konno is an attorney-at-law licensed in Japan and is an expertise in law. Although she has never assumed executive positions at companies, the Nominating Committee determined that Ms. Konno is eligible for serving as a director of the Company as she has served as outside directors and outside statutory auditors at listed companies and has in-depth knowledge of corporate governance which she acquired through her experience as an attorney-at-law. Board of Directors 11/11 times
Compensation Committee 11/11 times

*1 The Company’s outside directors and independent directors voted to appoint Makihara as the Lead Independent Director effective from April 2015.

Reasons for the selection of the executive officers

Mr. Okamoto and Mr. Mandai were appointed on December 1, 2019, while the other Executive Officers were appointed on June 22, 2019. Reasons for the selection at the time of each election is set forth below.

Name Reasons for the selection
Oki Matsumoto
(Representative Executive Officer)
He has led the growth and expansion of the group business and paved the way of the overseas business deployment and the launch of crypto asset business, since the establishment of the company in August 2004, as a President of the company. Because he has a superior ability as a leader to govern the group and accept various changes, he was judged to be a suitable person to play a central role in executing the group business, ongoingly, as a Representative Executive Officer and President & CEO, for the sake that our group can make "the second founding."
Yuko Seimei
(Senior Executive Officer)
She is highly regarded both inside and outside the company for her strong leadership as President of Monex, Inc., our core business in the Japan segment that serves as a steady stream of revenue for the Monex Group. In addition, she is in charge of the strategic planning for the group, helping create and maintain important external relations. Given these attributes, she is acknowledged as having a natural disposition in her role as a representative executive of the group and her appointment was extended accordingly.
Kiminori Kaneko
(Executive Officer)
He is familiar with securities-related systems and playing a central role in the development and operation of our core tradingsystem as a Managing Director of Monex, Inc. With the addition of our crypto asset business and the crucial security measures neededfor the group, his appointment to this role will continue to serve the group well.
Takashi Oyagi
(Executive Officer)
He made significant efforts on the TradeStation business for which he was responsible and achieved a turnaround into profit trends. In order to strengthen the profitability of the US business and pursue the challenge of new financial business including crypto asset business, he was judged to be a suitable person to work on the task as a strategic officer.
John Bartleman
(Executive Officer)
Serving as a president in the TradeStation group, he exercised strong leadership and contributed to turning around the business, and achieved a turnaround into profit trends, while addressing the difficulty of reduction of personnel. In order to make the TradeStation business as a major revenue source, it was judged to be appropriate that he continues serving the job.
Shoji Kuwashima
(Executive Officer)
He is not only savvy about the systems but also has superior achievements in business operations. For example, he exercised his abilities and turned around the business as a Representative Executive Officer and President at the time of the crisis in Nikko Cordial Corporation. He has been in charge of the management of the company and Monex, Inc. since 2009 and realized self-construction of the Monex core system. With the addition of the crypto currency business, security measures in the entire group have become more important. Therefore, it was judged to be appropriate that he continues fulfilling his responsibilities as an Executive Officer.
Masayuki Okamoto
(Executive Officer)
He is an experienced attorney who has been involved with various financial transactions that cross over international boundaries and provided advise to foreign entities and corporations on domestic laws. As a holding company with a number of financial related subsidiaries, his appointment as general counsel to supervise international corporate law will continue to serve the group well.
Katsuki Mandai
(Executive Officer)
He was the Head of Products Division for many years at Monex, Inc., the backbone of the Monex Group. In this role, he has brought a number of new services and products to the market that have helped raise the revenue of the company. There will be a lot of opportunities to present new financial instruments that exceed the conventional framework and use up-and-coming technologies such as blockchain and AI. As we look to provide new innovative services and as we implement a strategically important transition to an asset management model, his role and appointment will continue to serve the group well.

Advisory Board

*discontinued


In order to seek well-balanced, diverse and neutral opinions and valuable advice or guidance for overall business operations of the Company from a wide range of perspectives, Monex Group had been held quarterly advisory board meetings composed of key academic figures. A regular advisory board meeting was held 52 times from December 1999 to May 2013, for 13 and-a-half years.
 Monex Group decided to discontinue the advisory board because it adopted "company with committees" organizational structure in June 2013, which takes over the advisory board's role.