About the Board of Directors

Policies and Procedures for Nomination of Director Candidates

In accordance with the provisions of the company law, the Company shall determine the candidates Director Nominating Committee. The size, structure, aptitude, and independence of the independent Director of the Board of Directors, which should be considered in determining the Director candidate, are stipulated in article 2 and 5 of the company's Corporate governance guidelines:

Composition, size of the board

Given the need for diversity of the Board views and efficiency of the Board, the number of directors shall be no more than 20.
In nominating a director candidate, the Nominating Committee shall consider:
1. diversity in the experience and expertise, etc. possessed by the director candidates, the composition ratio between outside directors and other directors (directors concurrently serving as executive officers and non-executive directors from within the Hitachi Group), and other such matters in order to ensure the effectiveness of the management supervision and decision-making functions of the Board;
2. that to maintain the continuity of the Board, new candidates do not constitute all or almost all of the nominees; and
3. the period of time since the candidate's assumption of office as the Company's director and the candidate's age to keep bringing fresh ideas and viewpoints regularly to the Board.
  accounting or education, etc.,
In principle, a person will not be nominated as a director candidate after his or her 75th birthday. However, in special circumstances, a person over 75 years old may be nominated as a director candidate if the Nominating Committee approves. Also, in principle, the Nominating Committee will not nominate a person as an independent director candidate if a person has reached 10 years of total tenure. However, in special circumstances, a person with the total tenure of 10 years or more may be nominated as an independent director candidate, but even in this case, a person with the total tenure of 12 years or more can no longer be nominated as an independent director candidate.

Qualification for Directors

In nominating a director candidate, the Nominating Committee shall consider that:

such nominee has the highest personal and professional ethics, integrity and insight; and
such outside director nominee has distinguished records of leadership or experience at policy making levels in business, law, administration, or accounting or education, etc., in addition to satisfying the criteria for independency.

Criteria for Independency

The Nominating Committee considers an outside director to be independent unless:

his or her immediate family member is, or has been within the last three years, a director or an executive officer of the Company or any of its subsidiaries:
he or she is currently an executive director, an executive officer or an employee of a company that has made payments to, or received payments from, the Company for property or services in an amount which, in any of the last three fiscal years, exceeds 2% of any of the companies' consolidated gross revenues:
he or she has received during any of the last three fiscal years more than ¥ 10 million in direct compensation for his or
her service as a specialist in law, accounting or tax, or as a consultant from the Company, other than director compensations; or
he or she serves as an executive officer or director of a not-for-profit organization, and the Company's discretionary
charitable contributions to the organization in any of the last three fiscal years are more than ¥ 10 million and 2% of that organization's annual gross revenues.

Board of Directors Composition (As of June 2026)

The composition of the Board of Directors elected based on the above, and the experiences and insights, and skills of each director are as follows.
At Board of Directors, discussions are conducted from a variety of perspectives by directors possessing a wealth of experience and knowledge pertaining to management, risk management, legal affairs, accounting, government, international and educational organaizations, sastainability and digital initiatives at global corporations.

Board of Directors

Message from the Chairman of the Board

Administrative Performance of the Board of Directors

The Board of Directors approves the basic management policy for the Hitachi Group and supervises the execution of the duties of executive officers and directors in order to sustainably enhance corporate value and shareholders’ common interests. The basic management policy includes the management plan and annual budget planning. The Board of Directors focuses on strategic issues related to the basic management policy, as well as other items to be resolved that are provided in laws, regulations, the Articles of Incorporation and the Board of Directors Regulations.

In fiscal 2025, by approving Inspire 2027 management plan and receiving progress reports on two occasions at board meetings, we held many discussions on the ideal state the Hitachi Group should aim for in the future and the business strategies that would make that possible. We also widely discussed and deliberated on risk management pertaining to generative AI, and responses to geopolitical risks in light of recent world affairs.

Aside from these strategic discussions on basic management policies and risk-related discussions, recognition is shared between the supervisory and executive sides of management by having the President & CEO report to the Board of Directors on important executive topics, including key management issues discussed in the Senior Executive Committee, an advisory body to the President & CEO, and promoting discussion on such topics. To facilitate more lively discussion on these topics, more time is allotted to exchanging opinions than explaining each topic.

Board of Directors Meeting and major agendas in FY2025

FY2025 Board of Directors Meeting Results
Meetings held	10 times
Average number of agenda items	7.3 per meeting
Average meeting length	160.2 minutes

FY2025 time spent and ratios of explanations and discussions of important topics (results up to March 31, 2026)

Topics	Main Topics Discussed
CEO report	Progress of capital policy-related matters, response to investors, etc.
Inspire 2027	Resolution to approve Inspire 2027: 1 meeting Progress reports: 2 meetings
Settlement of accounts	Financial results, business environment, shareholder returns, etc.
Risk management	Status of compliance initiatives, improvements to Group governance and M&A processes, AI risk management, enterprise risk management (ERM), monitoring of investment and financing projects, etc.
Strategy, etc.	Research and development strategy, regional strategy, human capital strategy, sustainability strategy, individual M&A transactions

Notes

The time spent on Board of Directors meetings is approximately the same as for the previous fiscal year.
Among the key themes, the frequency and duration of agenda items related to management plans and strategies were at a similar level to the previous fiscal year.
The percentage of questions about Mid-term Management Plan-related issues and strategy increased, and the percentage of questions increased overall.

Providing information to independent directors

To enhance the effectiveness of the Board of Directors, Hitachi uses a dedicated information sharing tool to share materials for the Board of Directors and each committee, and also to share important business operation information from the executive departments with directors as needed. Moreover, Hitachi organizes individual meetings when necessary so that we can provide information in a timely and accurate manner. In principle, the Board of Directors meets once a year in a country with close ties to the business. In December 2025, a Board of Directors meeting was held in New Delhi, India. At the meeting in New Delhi, discussions were held on business strategies for the India region. In addition, a lecture by a local expert and visits to local subsidiaries were conducted.

In addition to this, Hitachi provides independent directors with ample opportunities to understand the business and share information through briefings on business details, visits to Group locations and the direct provision of information from Executive Officers. In fiscal 2025, Hitachi endeavored to deepen independent directors’ understanding of the businesses through activities such as attending the opening ceremony of the Hitachi Rail Hagerstown Factory (U.S.), visiting the Hitachi Rail CBTC Solutions Headquarters (Canada), participating in the Hitachi Social Innovation Forum, Hitachi Digital Summit, internal business conferences and research presentations held at research laboratories. We also provided opportunities for them to engage in dialogue with senior management and front-line employees. Audit Committee members also conducted onsite audits of Hitachi Rail (Italy), the Nuclear Energy BU (Japan), and Hitachi Power Solutions (Japan).

Activities of the three committees

	Meetings held in FY2025	Major activities
Nominating Committee	10 times	Decided the details of proposals for the election of directors Discussed future CEO successor candidates Confirmed the structure of executive officers for fiscal 2026 Discussed the development of management leadership candidates, conducted one-on-one interviews with leadership candidates
Compensation Committee	7 times	Confirmed and deliberated over the processes and details of performance evaluations and individual target evaluations regarding the assessment of fixed compensation and short-term incentive compensation for executive officers Discussed and deliberated on executive officer shareholding guidelines (to be introduced from fiscal 2026). Decided to revise the executive officer medium- and long-term incentive compensation program and transition to a structure consisting of a restricted stock unit (RSU) program and a performance share unit (PSU) program Reflected changes in the business environment, feedback from shareholders and investors and benchmark information and advice from third-party organizations in conducting deliberations
Audit Committee	12 times	Considered matters such as strengthening Hitachi's Tripartite Audit structure, and auditing the development and operational status of an internal control system Verified the results of financial statement audits and internal control audits based on the accounting auditor’s report Checked and approved the quality control structure and compensation of the accounting auditor Received regular reports on the risks, challenges and opportunities of executive departments Conducted onsite audit of Group locations

CEO Appointment, Dismissal, and Succession Plan

As stipulated in our Corporate Governance Guidelines, our basic policy concerning the CEO requires that individuals serving in the position of CEO have extensive experience and achievements in the field of company management. They must also be considered optimally suited for conducting management aimed at achieving Hitachi’s goals of continuously raising its corporate value and further serving the common interests of its shareholders. Decisions regarding the appointment or dismissal of the CEO shall be made based on prior deliberations and proposals by the Nominating Committee. And after a preliminary report to the Nominating Committee, Hitachi’s Board of Directors decides upon the appointment and dismissal of executive officers with the goal of constructing an optimal business execution system for management.
Regarding our CEO succession plan, as the speed of change in the management environment accelerates, we are striving to build a system that enables us to appropriately and promptly secure and develop (both internally and globally) necessary management personnel who will provide leadership that will allow us to realize our growth strategies. Accordingly, we are also concentrating on providing training for selected employees while targeting the early development of candidates for future management positions. Through this, participants discuss what is necessary for Hitachi’s future growth and have opportunities to make recommendations directly to management, fostering next-generation leaders who can act with confidence and determination.

Analysis and Evaluation of the Effectiveness of the Board of Directors

The Company evaluates the effectiveness of its Board of Directors each year in an ongoing effort to maintain and improve its functions. In particular, beginning in fiscal 2025, to ensure the objectivity of the evaluation and incorporate multifaceted perspectives, evaluations by Executive Officers and interviews conducted by a third-party organization have been introduced.

FY2025 evaluation process

Self-assessment by each director (February 2026)
- Board role
- Board composition (diversity of the Board, the number and proportion of independent directors, etc.)
- Board operation (relation between the Board and Executive Officers, appropriateness of agenda setting, time allocation, meeting frequency, etc.)
- Three committees’ activities (composition, roles, report to the Board, etc.)
- Information to the Board (provision of information such as the Board materials and business information, etc.)
- Contribution of the Board members themselves (understanding of the business and the Hitachi Group Identity, utilization of director’s knowledge and experience, etc.)
- Contribution by the Board (role of Chairperson, contribution to the succession plan of CEO, external communication, etc.)
Questionnaire-based evaluation by some Executive Officers (March 2026)
- Contribution by the Board
- Board composition
- Relationship between the Board and Executive Officers
Interview conducted by a third party for independent directors (From February to March 2026)
- To gain a deeper understanding of the directors’ self-assessment results, an interview with independent directors was conducted by a third party.
Discussions among independent and non-executive directors (March 2026)
- Independent directors and non-executive directors held a meeting and discussed the effectiveness of the Board of Directors, referring to each evaluation result and the Board’s activities in fiscal 2025 with respect to the evaluation items described in 1 through 3 above. The discussion focused on such topics as the appropriate division of roles between “oversight/supervision” and “execution,” strengthening communication between directors and Executive Officers, and the policy regarding the involvement of independent directors in investor engagement.
Discussions at the Board meeting (April 2026)
- The Board analyzed and evaluated its effectiveness as a whole and confirmed the policy on approaches to further enhance the Board’s effectiveness based on director self-evaluations, executive evaluations, third-party interviews, and Section 4 discussions, considering comparison to the evaluation results for the previous year and measures taken for improving its effectiveness.

Evaluation results (overall evaluation in FY2025)

The overall effectiveness of the Board of Directors is ensured by the following strengths in particular:

A healthy balance between oversight and execution of management, built on transparency and trust
A diverse Board composition designed with a global perspective
A Board culture that enables open, candid, and substantive discussion
Effective facilitation of the meetings and smooth operations

Future initiatives

Enhance corporate governance and further improve the effectiveness of the Board
- The Board of Directors will continue to hold more vigorous discussions regarding management policies, etc. from a medium- to long-term perspective with a thorough separation of execution and oversight.
- In addition to discussions at Board of Directors meetings, by setting up meetings for executive officers and directors to exchange opinions freely regarding the long-term management policy, further promote sharing of understanding and fostering of mutual trust between the Board and the executives.
- Independent and non-executive directors will share information on the selection of CEO and executive candidates as appropriate and provide further support for the development of said candidates
Enhance the Board support system and improve practical issues in operations
- Increase opportunities for Directors to further understand the businesses of the Company through briefing sessions to explain businesses, visiting operation sites of the Hitachi Group and other means
- Further improve the structure and contents of materials for the Board meeting, early provision of meeting materials
Dialogue with investors and information sharing with directors
- Establish and implement appropriate opportunities for dialogue and share feedback from investors with each director

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