NEC 2011 Annual Report Download - page 33

other similar measures pertaining to these employees
are subject to the approval of the corporate auditors.
9 The directors and employees report on the status of
the performance of their duties and other matters, as
necessary.
0 In order to ensure that audits are performed effectively,
the corporate auditors exchange information and
consult with each other on the status of audits.
Furthermore, the corporate auditors periodically receive
reports on financial audits from the accounting auditors
and exchange opinions with them.
The aforementioned Basic Policy is disclosed in full on
NEC’s website at the following URL:
http://www.nec.co.jp/profile/en/internalcontrol.html
INFORMATION DISCLOSURE STRUCTURE
NEC recognizes the importance of providing timely,
proper and fair disclosure to obtain a fair evaluation of its
corporate value from the capital markets. Accordingly,
NEC regularly strives to ensure that internal divisions and
subsidiaries have a clear understanding of timely disclosure
and other rules issued by financial instruments exchanges,
while establishing a framework for communication between
relevant internal head office divisions and subsidiaries.
Furthermore, NEC holds various events for the news
media, analysts and institutional investors. Examples
include management strategy presentations and quarterly
earnings presentations by senior management, as well as
business strategy presentations by various responsible
managers, including plant tours. Efforts are also focused
on improving disclosure of information on NEC’s website,
including the disclosure of materials, audio streams and
other information issued at presentations and other
events, both in Japanese and English, and enhancing
investor relations activities on a global scale, including
visiting overseas institutional investors. Disclosure to
individual investors includes presentations and a website
for these investors.
REMUNERATION FOR DIRECTORS AND
CORPORATE AUDITORS
The maximum total amounts of remuneration for directors
and corporate auditors are determined by a resolution at
the general meeting of shareholders.
At NEC, remuneration for directors is determined by the
Board of Directors based on the results of deliberations of
this remuneration from an objective perspective by the
Nomination and Compensation Committee. Remuneration
for directors is determined according to their positions and
whether they are an outside director or not, while bonuses
for directors are calculated by adding an amount
determined based on an evaluation of the contribution of
their performance to the business results of NEC during
the previous fiscal year to an amount prescribed based on
their position. No bonuses are paid to outside directors.
Remuneration for corporate auditors is calculated
under certain rules determined by the Board of Corporate
Auditors; no bonuses are paid to corporate auditors.
NEC abolished the retirement allowance system for
directors and corporate auditors at the close of the 168th
Ordinary General Meeting of Shareholders held on June
22, 2006.
Remuneration for NEC’s directors and corporate
auditors for fiscal 2011 is as follows:
FISCAL 2011 REMUNERATION
(Millions of yen)
Position Total remuneration Headcount
Directors
(excluding Outside Directors) 417 14
Corporate Auditors
(excluding Outside Corporate Auditors) 59 2
Outside Directors and Outside
Corporate Auditors 95 9
Notes: 1. The above headcount includes 4 directors and a corporate auditor
who retired at the close of the 172nd Ordinary General Meeting of
Shareholders held on June 22, 2010.
2. Retirement allowance of ¥6,000,000 and ¥3,000,000 are scheduled
to be paid to one director and one corporate auditor, respectively,
who are to retire at the close of the 173rd Ordinary General Meeting
of Shareholders.
3. The maximum monthly remuneration for directors is ¥65,000,000
(Approved at the 153rd Ordinary General Meeting of Shareholders
held on June 27, 1991).
4. The maximum monthly remuneration for corporate auditors is
¥12,000,000 (approved at the 170th Ordinary General Meeting of
Shareholders held on June 23, 2008).
OWNERSHIP OF SHARES
As of March 31, 2011, the number of stocks classified as
investment securities held for purposes other than realizing
income and capital gain was 469 and the total balance
sheet amount of these stocks was ¥126,083 million. The
top 10 stocks based on the balance sheet amount (except
unlisted stocks) are as follows:
TOP 10 STOCKS BASED ON BALANCE SHEET AMOUNT
As of March 31, 2011
Name of stock
Number of
shares
(Thousands
of shares)
Book value
(Millions
of yen)
Holding
Purpose
Elpida Memory, Inc. 7,740 8,290 1
Sumitomo Electric Industries, Ltd. 6,914 7,958 2
Anritsu Corporation 8,312 5,262 3
The Sumitomo Trust and
Banking Co., Ltd. 8,658 3,732 2
MEIDENSHA CORPORATION 8,730 3,230 2
MS&AD Insurance Group
Holdings, Inc. 1,570 2,974 4
NIPPON TELEGRAPH AND
TELEPHONE CORPORATION 686 2,562 4
Taisho Pharmaceutical Co., Ltd. 1,100 1,980 2
Sumitomo Chemical Company
Limited 4,083 1,694 2
Seven Bank, Ltd. 10 1,675 2
Note: Figures less than one thousand are rounded down.
1 Due to the background of the establishment of the company as a joint
venture with a third party
2 To maintain and strengthen business relations with the company
3 At the request of the company
4 To maintain and strengthen business relations with the company and its
group companies
No stocks classified as investment securities are held
for the purposes of realizing income and capital gain.
In fiscal 2011, there was no stock classified as
investment securities for which the purpose of holding
changed from realizing income and capital gain to another
purpose, and vice versa.
32
NEC Corporation
Annual Report 2011