Compensation for executive officers

 

Basic policy¹

Our executive compensation system is designed to achieve the following objectives and approaches pursuant to the basic policy on management under the Mizuho Financial Group's Corporate Identity.

Objectives	Management that contributes to value creation for various stakeholders. Improvement of corporate value through continuous and stable corporate growth.
Approaches	Incentive function encouraging each of the Officers to fulfill their designated roles to the greatest extent. Compensation for the responsibilities assigned to, and the performance of, each of the Officers.

1. The full text of the "Basic Policy for Executive Compensation" is posted on the Mizuho Financial Group's website.
   https://www.mizuhogroup.com/who-we-are/governance/governance/g_report

 

Compensation system

Close up

1. Payment will be made monthly in cash in accordance with the roles and responsibilities of each of the Officers.
2. Payment in accordance with the roles and responsibilities of each of the Officers as an incentive to increase corporate value over the medium to long term and for other purposes.
3. Payment in accordance with level of achievement of financial indicators emphasized by the Mizuho Financial Group and evaluation of indicators related to stakeholders as an incentive to increase corporate value over the medium to long term and for other purposes.
4. Payment in accordance with level of achievement of financial indicators emphasized by the Mizuho Financial Group and the evaluation of individual performance as an incentive for fiscal year performance to increase corporate value.
5. Deferred payment over three years starting the fiscal year after next for payments above a certain amount.
6. A system has been adopted that enables malus (forfeiture of compensation remaining unpaid) and clawback (request for return of compensation) by resolution of the Compensation Committee depending on the performance of the group or the individual.

Performance evaluation indicators for performance-linked compensation

Medium- to Long-term Incentive Compensation (Stock Compensation II)

Short-term Incentive Compensation¹

1. The evaluation factor for the short-term performance indicators and individual evaluation is capped at 150%

Close up

Compensation Governance

Individual compensation determination process

The Compensation Committee shall determine the executive compensation system including the compensation system taking into account the Basic Policy for Executive Compensation. In addition, in order to ensure fairness and objectivity concerning the compensation for each officer, the Compensation Committee shall determine the compensation for each individual director and executive officer of Mizuho Financial Group as defined in the Companies Act and approve the compensation of each individual director of the Three Core Companies (Mizuho Bank, Mizuho Trust & Banking, and Mizuho Securities).

Individual compensation determination process diagram

Appropriateness of compensation level and composition

We conduct a market survey each year with other companies in the same industry and similar-scale corporate groups as the peer group, and examine the appropriateness of the compensation level and composition.

Amounts of compensation

Aggregate amounts of compensation paid to directors and executive officers as defined in the Companies Act

Shown below are the compensations of the directors and executive officers as defined in the Companies Act.

The aggregate compensation paid to directors who concurrently serve as executive officers as defined in the Companies Act is included in the below table as those of "Executive officers as defined in the Companies Act."

Notes:

1. The amounts are indicated in units of one million yen and the numbers of shares are indicated in units of one thousand. Fractions are rounded down.
2. The number of directors in the "Fixed compensation" column for the Compensation for fiscal year 2022 includes one director who retired on June 21, 2022. The number of executive officers for the Compensation for fiscal year 2021 includes one executive officer who resigned on November 26, 2021, one executive officer who resigned on January 17, 2022, one executive officer who was dismissed (*) on February 1, 2022 and two executive officers who resigned on April 1, 2022.
   (*Due to health reasons, the original plan (resignation on April 1, 2022) was moved forward.)
3. With respect to Stock Compensation I for fiscal year 2022, the amounts given are obtained by multiplying the stock ownership points, granted by the Compensation Committee of Mizuho Financial Group in July 2022 for fiscal year 2022 based on the functions and responsibilities of each of the Officers (one (1) point translates into one (1) share of common stock of Mizuho Financial Group), by the book value of Mizuho Financial Group stock (JPY 1,607.087 per share). Stock Compensation I is not linked to the performance of the group and shall be paid at the time of resignation. 
4. The other compensation for fiscal year 2022 includes condolence money premiums and other premium subsidies (group life insurance premiums paid by the group to the Officers as the insured party).
5. The target and result of key indicators related to the corporate performance linked compensation and others (variable compensation) for fiscal year 2021 are as follows: 

FY2021	Target set at the beginning of the fiscal year	Result
Consolidated Net Business Profits + Net Gains (Losses) related to ETFs and others	JPY 790 billion	JPY 853.1 billion
Net Income	JPY 510 billion	JPY 530.4 billion
Consolidated ROE	6.1%	6.4%
Expense Ratio	64.0%	63.3%

6. With respect to the Performance Payments, the amounts stated were decided by the Compensation Committee of Mizuho Financial Group in July 2022 as the Performance Payments for fiscal year 2021.
7. With respect to the Stock Compensation II, the amounts given are obtained by multiplying the stock ownership points, granted by the Compensation Committee of Mizuho Financial Group in July 2022 for fiscal year 2021 based on the functions and responsibilities and performance of each of the Officers, by the book value of Mizuho Financial Group stock (JPY 1,607.087 per share). Stock Compensation II for fiscal year 2021 is expected to be paid as deferred payments over three years from fiscal year 2023.
8. With respect to the other compensation for fiscal year 2021, the amount of fixed compensation paid in deferral is stated. The fixed compensation paid in deferral is a system whereby the decision to pay a portion of the fixed compensation is deferred and can be reduced or forfeited in accordance with the performance of Mizuho Financial Group and other factors.
9. Because the amount of the corporate performance linked compensation and others (variable compensation) to be paid with respect to fiscal year 2022 has not yet been determined at present, the aggregate compensation above does not include the amount of corporate performance linked compensation and others (variable compensation); however, the necessary reserve is recorded for accounting purposes. 
10. Since the Compensation Committee determines the executive compensation system, including the compensation system, taking into account the Basic Policy for Executive Compensation, we believe that the details of individual compensation for directors and executive officers as defined in the Companies Act are in line with the Basic Policy for Executive Compensation. 
     

*For information on the compensation system related to the above results, please refer to the following.
https://www.mizuhogroup.com/who-we-are/governance/governance/structure/reward/closeup01