Overview of Corporate Governance

The Company considers the growth of profits for shareholders and investors from a long-term perspective as an important managerial objective. As the Company and the Hitachi Group have a wide range of stakeholders, from shareholders and investors to customers and clients, the Company realizes that building good relationships with them forms an important part of its corporate value.

The Company is a Company with Nominating Committee, etc. under the Companies Act, aiming to establish a framework for quick business operation and to realize highly transparent management by separating responsibilities for management oversight and those for the execution of business operations. The Company attempts to maintain an appropriate composition of the Board of Directors aiming to ensure the effectiveness of its management oversight function in addition to reflect diverse global perspectives in management. In May 2012, the Company established the Corporate Governance Guidelines, which outlines the basic framework of corporate governance, including the roles that the Board of Directors should fulfill, and posted them on the Company's website.

In addition, the Company has positioned the Hitachi Group Code of Ethics and Business Conduct as behavior disciplines to be shared among the Group to generate common values for the Group and promote understanding of the social responsibilities to be fulfilled by the Group.

POINT①　Independence of the Board of Directors

The Board of Directors consists of 11 members: eight independent directors, two directors who concurrently serve as executive officers and one non-executive director. The Board is chaired by an independent director. Furthermore, by separating management oversight from execution, we have established a structure that enables the Board to fully exercise its supervisory functions.

POINT②　Transparency in management

We have established three committees—Nomination, Audit, and Compensation—each chaired by an independent outside director. This structure is designed to strengthen the supervisory function of the Board of Directors while ensuring that discussions and reporting within the committees are conducted effectively.

POINT③　Enhanced collaboration through tripartite auditing

Hitachi's basic policy is not to acquire or hold the shares of other companies except in cases where acquiring or holding such shares is necessary in terms of commercial transactions or business relationships. We will promote divesting such shares already held unless the significance or economic rationalities of holding are confirmed. The Board of Directors verifies the appropriateness of all such shareholdings every year. In the verification, each individual share is examined as to the purpose of holding the share and whether benefits from holding the share are in line with our capital efficiency targets. As a result of verification, we promote the divesture of the share for which the significance or economic rationality of holding is not confirmed. As of the end of FY2025, the ratio of strategic shareholdings (total amount recorded on the balance sheet) made up 4.0% of net assets (consolidated).