みずほフィナンシャルグループ（8411） – Corporate Governance Report

Mizuho Financial Group, Inc. Corporate Governance Last updated: April 7, 2022 Mizuho Financial Group, Inc. President & Group CEO Masahiro Kihara For inquiry: Planning Administration Department 03-5224-1111(Phone) Stock code number: 8411 URL: https://www.mizuhogroup.com/ The following summarizes matters related to corporate governance of Mizuho Financial Group, Inc. (“MHFG” or “we”) as required to be disclosed pursuant to Japanese disclosure rules. I. Our basic corporate governance policy, basic information on capital structure, corporate attribution and others 1. Corporate governance policy Regarding the recent series of IT system failures that began from February 28, 2021, as a financial institution bearing responsibility for maintaining societal infrastructure, we deeply apologize for the inconvenience and concern we have caused to our customers and society by allowing these system failures to occur repeatedly in a short period of time and, as a consequence, failing to adequately fulfill our role in facilitating smooth settlements, as well as failing to adequately ensure thorough operations under the Foreign Exchange and Foreign Trade Act of Japan. On November 26, 2021, Mizuho Financial Group, Inc. and Mizuho Bank, Ltd. received a business improvement order from the Financial Services Agency of Japan, in regard to the series of IT system failures that have occurred since February 28, 2021. Also on the same day, Mizuho Bank, Ltd. received a corrective action order from the Ministry of Finance of Japan, in regard to the performance of the confirmation obligations of banks under Article 17 of the Foreign Exchange and Foreign Trade Act of Japan. At both Mizuho Financial Group, Inc. and Mizuho Bank, Ltd., we are treating these orders with the utmost seriousness, and reflecting on our mistakes. Mizuho Bank, Ltd. has submitted a report complying with the corrective action order to the Ministry of Finance on December 17, 2021. Mizuho Financial Group, Inc. and Mizuho Bank, Ltd. submitted a business improvement plan to the Japanese Financial Services Agency on January 17, 2022. Both Mizuho Financial Group, Inc. and Mizuho Bank, Ltd. are steadily implementing business improvement plans. In order to ensure that customers can use Mizuho services with peace of mind, all directors and employees will work together as an organization to establish a strong framework that prevents system failures that could have a significant impact on customers and minimizes the impact on customers even in the event of a failure. We will continue to pursue these initiatives under our current ever changing environment. Mizuho Bank, Ltd. will implement the measures to improve operations and prevent further incidents in line with the corrective action order. In doing so, we will endeavor to enhance our structure for complying with foreign exchange laws and regulations. Regarding the items of the business improvement order, the corrective action order, the report complying with the corrective action order, and the business improvement plan, please refer to our website for details. The business improvement order and the corrective action order “Regarding administrative actions by the Financial Services Agency and Ministry of Finance of Japan” (November 26, 2021) https://www.mizuhogroup.com/news/2021/11/20211126release_eng.html 1 The report complying with the corrective action order “Submission of report complying with the corrective action order issued by the Ministry of Finance of Japan to Mizuho Bank, Ltd.” (December 17, 2021) https://www.mizuhogroup.com/news/2021/12/20211217release_eng.html The business improvement plan “Submission of Business Improvement Plan” (January 17, 2022) https://www.mizuhogroup.com/news/2022/01/20220117release_eng1.html “Mizuho’s Corporate Identity,” which is composed of Corporate Philosophy, Vision and the Mizuho Values, serves as the concept that forms the basis of Mizuho’s business activities. • Corporate Philosophy: Mizuho’s fundamental approach to business activities, based on the raison d’etre of Mizuho Mizuho, the leading Japanese financial services group with a global presence and a broad customer base, is committed to : Providing customers worldwide with the highest quality financial services with honesty and integrity; Anticipating new trends on the world stage; expanding our knowledge in order to help customers shape their future; Growing together with our customers in a stable and sustainable manner; and Bringing together our group-wide expertise to contribute to the prosperity of economies and societies throughout the world. These fundamental commitments support our primary role in bringing fruitfulness for each customer and the economies and the societies in which we operate. Mizuho creates lasting value. It is what makes us invaluable. • Vision: Mizuho’s vision for the future, realized through the practice of “Corporate Philosophy” The most trusted financial services group with a global presence and a broad customer base, contributing to the prosperity of the world, Asia and Japan. 1. The most trusted financial services group 2. The best financial services provider 3. The most cohesive financial services group • Mizuho Values: The shared values and principles of Mizuho’s people, uniting all executives and employees 1. Customer First: The most trusted partner lighting the future 2. Innovative Spirit: Progressive and flexible thinking 3. Team Spirit: Diversity and collective strength 4. Speed: Acuity and promptness 5. Passion: Communication and challenge for the future We define “Mizuho’s Corporate Identity,” form a basic management policy and strategies for our entire group based on that basic policy, have each company in our group work together and promote such group strategy. Thus we operate Mizuho’s business giving due regard to creating value for diverse stakeholders and realize improved corporate value through continuous and stable corporate growth. As a result, we fulfill our social role and mission by contributing to internal and external economic and industrial development and prosperity of society. For that purpose, we, as a holding company, play an active role in the management of our group; take on a planning 2 function with respect to strategies and policies of our group and a controlling function with respect to each company of our group as part of its business management; establish a corporate governance system consisting of the Board of Directors at its core, which has received the mandate of the shareholders; and ensure that self-discipline and accountability of management of our group is fully functioning. We have adopted a Company with Three Committees in order to realize the basic policy regarding our corporate governance system shown below: 1) Secure the effectiveness of corporate governance by ensuring the separation of supervision and management and making supervision of the management such as the execution of duties, etc., by executive officers the primary focus of the Board of Directors. 2) Make it possible for the management to make swift and flexible decisions and realize expeditious corporate management by the Board of Directors’ delegating decisions on business execution to executive officers. 3) Utilize committees, etc., comprising mainly of outside directors who are independent from the management of Mizuho, and secure transparency and fairness in decision-making processes and the effective supervision of the management. 4) In the course of designing the organizations, etc., comprising the corporate governance system that realizes matters set out in items 1 through 3, the Company is to actively adopt operations and practices that are recommended at a global level regarding corporate governance as well as compliance with Japanese and foreign laws and regulations as a financial group expanding across the globe. Regarding the fundamental perspectives, framework and governing policies of our corporate governance system (Board of Directors, Directors, Nominating Committee, Compensation Committee, Audit Committee, voluntary committee, etc., Mizuho’s group governance and our advisor system), we have established the “Corporate Governance Guidelines” as high-level regulations superseded only by the Articles of Incorporation. For your reference, we put it on our website at https://www.mizuhogroup.com/who-we-are/governance/governance/g_report#guideline. [Reasons for not implementing each principle of our corporate governance policy] We are implementing all the principles of the Corporate Governance Code. [Principle 1.4] (Cross-Shareholdings) “Policy Regarding Mizuho Financial Group’s Cross-shareholdings of Other Listed Companies” • As a basic policy, unless we consider these holdings to be meaningful, MHFG and the Three Core Companies* will not hold the shares of other companies as cross-shareholdings. This reflects factors including the changes in the environment surrounding Japan’s Corporate Governance Code and the potential impact on our financial position associated with stock market volatility risk. • We consider cross-shareholdings to be meaningful if they contribute to the maintenance and improvement of the corporate value of issuers and the Mizuho group based on their growth potential, outlook, or revitalization perspectives or as a result of studies on present and future economic feasibility and profitability. • We will regularly and continually examine whether shares held as cross-holdings are meaningful, and we will dispose of holdings determined to be deficient in meaning with due regard to the impact on the market and other matters. Through dialogue with the issuing companies, we will also reduce even those holdings we consider to be meaningful. “Standards Regarding the Exercise of Voting Rights Associated with Cross-shareholdings” • MHFG and the Three Core Companies will exercise voting rights after comprehensive consideration of 3 whether an issuing company has established effective corporate governance and is making appropriate decisions to improve its corporate value over the medium to long term. We will also consider any impact to our own corporate value. Further, if we are unable to agree on proposals made by issuing companies, we may consider disposing of our share holdings. • We will consider specific proposals through dialogue with the issuing companies and studies conducted by our own specialized departments. In particular, when proposals such as those listed below could affect corporate value or shareholder interests, we will decide on the exercise of voting rights after comprehensive consideration of the purposes of the proposals and the issuing company’s approach to improving corporate value. • Proposals to re-elect directors and auditors, grant retirement benefits, pay bonuses and increase compensation amounts when an issuing company has posted a loss or paid no dividends for a certain period of time, or a corporate scandal has occurred. • Proposals to re-elect representative directors when profit on capital is going through a long-term slump or there are less than the required number of independent directors after convening a general meeting of shareholders. • Proposals to appropriate retained earnings when there are ongoing low dividend distributions or when such proposals, if resolved, may adversely affect financial soundness. • Proposals to adopt or continue anti-takeover measures. • Proposals for reorganization such as through a merger. • Proposals for capital strategies, including issuing new shares. • Proposals to grant stock options to dilute overall shares. • Proposals to change articles of incorporation that may impact shareholder value. • Proposals based on shareholder proposals. *: “Three Core Companies” refers to Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd. and Mizuho Securities Co., Ltd. (the same applies hereinafter) MHFG has published an overview of assessment results of cross-shareholdings on its website at https://www.mizuhogroup.com/who-we-are/governance/governance/structure/hold. [Principle 1.7] (Related Party Transactions) When MHFG engages in transactions with its directors or major shareholders (i.e., related-party transactions), in order to ensure that such transactions do not harm the interests of the Company or the common interests of its shareholders, MHFG has established the following system: • As a result of a resolution of the Board of Directors, MHFG has established the “Mizuho Code of Conduct” and the “Compliance Manual” to prohibit conflicts of interest conduct, bribery of shareholders in relation to exercise of their rights, and favors to shareholders, and to disseminate and ensure compliance with an arm’s-length relationship in related-party transactions. The Board of Directors, Audit Committee, Executive Management Committee and the President & CEO receive reports and perform monitoring, with respect to the status of compliance, etc., periodically and as necessary. • When directors or executive officers engage in transactions in the line of business of MHFG or transactions that have conflicts of interest, MHFG has expressly provided in the “Regulations of the Board of Directors,” which was established as a result of a resolution of the Board of Directors, that such transactions are matters subject to approval by the Board of Directors, which are monitored at the Board of Directors through approval of or report on each actual transaction and audited at the Audit Committee pursuant to the “Audit Policies of the Audit Committee.” • When directors or executive officers engage in transactions in the line of business of MHFG or transactions 4 that have conflicts of interest and the Board of Directors approves the matters, the legal risk department of MHFG conducts legal review. Additionally, the legal risk department also conducts legal review, as necessary, on matters concerning transactions between MHFG and its group company. [Supplementary Principle 2.4.1]（Ensuring Diversity in Appointing Core Personnel, etc.） “Approach to Ensuring Diversity” MHFG has been actively introducing initiatives to enhance diversity within our workforce throughout the world for a long time. We attach great importance to creating an environment of greater mutual inspiration, understanding, and respect among employees with different attributes and backgrounds, such as nationality, gender, and values. In particular, in order to more effectively reflect diverse perspectives, thinking and values in the formulation of fundamental strategies, our decision-making and our day-to-day business, MHFG will promote programs that encourage appointment of women, international talent and mid-career hires to the management or other managerial positions. “Voluntary and Measurable Targets and Their Status” Target Target time frame Achievement (Jul 2021) 7% Jul 2024 Jul 2024 18% Percentage of management filled by women*1 positions General manager equivalent Manager equivalent and above 10% 20% Achievement (Jul 2021) 64% *1 Japan (Total of Mizuho Financial Group, Mizuho Bank, Mizuho Trust & Banking, and Mizuho Securities) Level to be achieved continuously Percentage of management positions filled by employees hired outside Japan*2 Percentage of management positions filled by mid-career hires*3 65% 15% or more 15% *2 Ex-Japan (Total of Mizuho Bank, Mizuho Trust & Banking, and Mizuho Securities) *3 Manager equivalent and above, Japan (Total of Mizuho Financial Group, Mizuho Bank, Mizuho Trust & Banking, and Mizuho Securities). “Human Resource Development Policy for Ensuring Diversity and Implementation Status” MHFG works diligently to build a talent portfolio that balances the career ambitions of each and every employee with each business field’s needs for talents to realize its strategies. Our talent development process is conducted strategically on a global, group–wide basis in accordance with each employee’s stage of career development. For details, see our website and Integrated Report (Annual Review) as follows. -Talent development https://www.mizuhogroup.com/sustainability/employees/success/training -Employee Engagement https://www.mizuhogroup.com/who-we-are/strategy/hr -Integrated Report (Annual Review): https://www.mizuhogroup.com/investors/financial-information/annual “Internal Environment Development Policy for Ensuring Diversity and Implementation Status” 5 MHFG is committed to creating an engaging work environment which will encourage long–term retention and contribution. Following is initiatives MHFG implemented. – Utilizing diversity of employees – Promoting engagement of female employees – Promoting engagement of employees with disability – Promoting engagement of skillful or experienced employees regardless of their nationalities – Supporting LGBT employees – Promoting engagement of senior employees For details, see our website and Integrated Report (Annual Review) as follows. -Promoting the employment and advancement of diverse talent https://www.mizuhogroup.com/sustainability/employees/di/diversity -Integrated Report (Annual Review): https://www.mizuhogroup.com/investors/financial-information/annual [Principle 2.6] (Roles of Corporate Pension Funds as Asset Owners) Our group has established “Mizuho Corporate Pension Fund” (the “Fund”), a corporate pension fund system. In order to demonstrate the expected functions as an asset owner, we are striving to fulfill this responsibility through filling prominent positions of the Fund with personnel with expertise in fund management and other pension related areas. Moreover, along with announcing that the Fund accepted “Principles for Responsible Institutional Investors (the Japanese version of Stewardship Code)”, the Fund has implemented specific guidelines to fulfill the responsibilities thereof and disclosed the same. Also, with regards to preventing conflicts of interest between MHFG and subscribers/beneficiaries of the Fund, we ensure that these are managed appropriately by fulfilling the fiduciary duties as provided in the Defined-Benefit Corporate Pension Act. [Principle 3.1] (Full Disclosure) i) Our group has established and published its corporate philosophy. For “Mizuho’s Corporate Identity,” see “I. 1. Corporate governance policy. In addition, MHFG has also published the business plan on its website at https://www.mizuhogroup.com/news/2019/05/5-year-business-plan.html ii) Regarding the fundamental perspectives, framework and governing policies of our corporate governance system (Board of Directors, Directors, Nominating Committee, Compensation Committee, Audit Committee, voluntary committees, etc., Mizuho’s group governance, and our advisor system), we have established the “Corporate Governance Guidelines” as high-level regulations superseded only by the Articles of Incorporation. For your reference, it is available on our website at https://www.mizuhogroup.com/who-we-are/governance/governance/g_report#guideline. iii) The Compensation Committee has established its policies and procedures for the Board of Directors to determine compensation for directors and executive officers in “II. 1. The disclosure of policies determining the amount of compensation or method of calculating compensation of directors and executive officers.” iv) MHFG has established its policies for the Nominating Committee to determine candidates for directors and for the Board of Directors to appoint or dismiss executive officers in “Composition of the Board of Directors”, “Appointment and Dismissal of Directors” and “Composition and Appointment and Dismissal of Executive Officers” of its “Corporate Governance Guidelines.” 6 In determining candidates for directors, MHFG takes procedures at the Nominating Committee as provided in “Operation of the Nominating Committee” of the “Corporate Governance Guidelines.” When the Board of Directors appoints or dismisses executive officers, the Human Resources Review Meeting conducts the deliberation of proposals as provided in the “Operation of the Human Resources Review Meeting” of the “Corporate Governance Guidelines” and thereafter they are resolved at a Board of Directors Meeting. For your reference, “Corporate Governance Guidelines” is available on our website at https://www.mizuhogroup.com/who-we-are/governance/governance/g_report#guideline. v) With regard to the reasons of determining candidates for directors, MHFG provides them each year on the reference materials of the “notification of general meeting of shareholders” where it presents to the general meeting of shareholders a proposal to determine directors. MHFG sends out the “notification of general meeting of shareholders” to all the shareholders as well as publishes it on its website at https://www.mizuhogroup.com/investors/financial-information/stock-information/meeting. With regard to the reasons of determining executive officers, MHFG provides them each year on its “Business Report.” MHFG sends out the “Business Report” with the abovementioned “notification of general meeting of shareholders” to all the shareholders as well as publishes them on its website at https://www.mizuhogroup.com/investors/financial-information/stock-information/meeting. [Supplementary Principle 3.1.3] (Sustainability Initiatives, etc.) MHFG is promoting sustainability initiatives in line with our management strategy, and the status of our initiatives is disclosed in the following Integrated Report (Annual Review) and on our website. We also disclose the status of initiatives that constitute important strengths for our value creation including the allocation of management resources to enhance “human and intellectual capital” such as “financial functions, ability to respond to non-financial needs, and excellent team of professionals” in the Integrated Report and on our website. Furthermore, MHFG has principally supported the TCFD recommendations since 2017, and based on the recognition that climate change is one of the most crucial global issues that could affect the stability of financial markets, the Company has positioned addressing the environment and climate change as a key part of our corporate strategy and is working to strengthen relevant initiatives. We disclose the status of these efforts in our Integrated Report and TCFD Report. -Integrated Report (Annual Review): https://www.mizuhogroup.com/investors/financial-information/annual -Sustainability: https://www.mizuhogroup.com/sustainability -Employee Engagement https://www.mizuhogroup.com/who-we-are/strategy/hr -TCFD Report https://www.mizuhogroup.com/binaries/content/assets/pdf/mizuhoglobal/sustainability/overview/report/tcfd_report_2021.pdf [Supplementary Principle 4.1.1] (Roles and Responsibilities of the Board (1)) The Board of Directors of MHFG shall make decisions on business execution matters that have to be determined solely by the Board of Directors under laws and regulations, such as basic management policy, while it, in principle, shall delegate to the President & CEO, who is the Group CEO, decisions on business execution excluding matters to be determined solely by the Board of Directors under laws and regulations. 7 With regard to the purposes of the delegation from the Board of Directors to executive officers, MHFG has provided such information in “Role of the Board of Directors and Directors” of its “Corporate Governance Guidelines”. https://www.mizuhogroup.com/who-we-are/governance/governance/g_report#guideline. [Supplementary Principle 4.1.3] (Succession Planning) 1. Basic concept and overview We are devoting ample time and resources to succession planning in order to appoint optimum personnel to positions such as Group CEO, principal management members who support the Group CEO (e.g. our in-house company heads) as well as top management of the Three Core Companies, with the purpose of achieving sustainable growth for the entire Group and improving corporate value over the medium- to long-term. In addition, in preparation for any unforeseen circumstances of the Group CEO, we also consider candidates for the Group CEO “after the next.” Implementation of and the status of operation of succession planning for the Group CEO and other positions are reported to meetings of the Nominating Committee and “Human Resources Review Meeting” (collectively “Nominating Committee, etc.”). The core elements of the succession planning for the Group CEO and other positions are deliberation at meetings of the Nominating Committee, etc. on (i) the personnel requirements expected for each position, (ii) timing of the succession, (iii) setting up a candidate pool and taking the time to properly train candidates (including the necessary career selection for candidates), (iv) the personalities of the candidates members of the Nominating Committee, etc. have comprehended and (v) the decisions on candidates, etc., by taking into consideration the current Group CEO’s opinion. The Nominating Committee, etc. discusses the selection of the Group CEO in full based on personalities and disregards formalistic human resource management such as annual promotion based on seniority, by utilizing multifaceted personnel evaluation information including a 360-degree evaluation of the candidate and third-party evaluation by an external institutional evaluator, thoroughly profiling candidates and taking into consideration the opinion of the current Group CEO. The current Group CEO fully cooperates with the Nominating Committee, etc. for the committee to gain an understanding of the personality of the candidates by, for example, establishing a process to directly grasp the abilities and qualifications etc., of candidates. The Nominating Committee makes a decision on the appointment of a director who concurrently serves as the Group CEO while ensuring objectivity and transparency of the process. 2. Personnel requirements of the Group CEO Our Group CEO is expected to satisfy the following requirements as the head of the leading Japanese financial services group with a global presence and a broad customer base. 1) The Group CEO is required to possess both strong will and humility, and needs to be an individual who is open, fair, sincere and honest and is trusted and relied upon by various stakeholders on global-basis. 2) The Group CEO needs to be a leader who can lead the Group and accomplish sustainable growth even in the face of uncertain environment or difficult situations, by confronting them decisively with his/her unshaken faith and flexibility to address changes. 3) The Group CEO is required to possess extensive experience and knowledge, and the ability to foresee a new era. He/she needs to be an adversary who devotes his/her passion to create new value or make changes that contribute to our customers or the future of the economy and society. In addition to the above, in appointing the Group CEO, we examine required qualifications or abilities that we emphasize or further take into consideration after considering the business environment surrounding us at the time of succession, recognition of the era we are in based on such business environment as well as the direction of the group strategies. 8 3. Regarding the Group CEO succession announced in January 2022 Mizuho Financial Group hereby announces that, on January 17, 2022, Managing Executive Officer Masahiro Kihara was officially selected as the successor to Member of the Board of Directors and President & Group CEO Tatsufumi Sakai (“Group CEO”; titles are current as of January 2022). Mr. Kihara will be appointed as President & Group CEO on February 1, 2022 and as a member of the Board of Directors after the ordinary general meeting of shareholders in late June. 【Background to the Group CEO succession】 As announced on November 26, 2021, from the viewpoint of clarifying management’s responsibility for the series of IT system failures at Mizuho Bank, Group CEO Sakai submitted a formal request to resign from his position to the Board of Directors and Nominating Committee, and the Board of Directors and Nominating Committee accepted his resignation. 【Role of the Nominating Committee】 In the Group CEO succession process, the Nominating Committee carried out its legally determined function of deciding candidates for membership of the Board of Directors. In addition to this function, the Nominating Committee also served the role usually filled by the Human Resources Review Meeting, which is chaired by the Group CEO. The Board of Directors authorized the Nominating Committee to take on the said role in order to ensure objectivity in the selection process for the Group CEO position. Consequently, the Nominating Committee deliberated on the selection of the next Representative Executive Officer / President & Group CEO as well. Mizuho Financial Group’s Nominating Committee, including the committee chair, is comprised entirely of outside directors with an adequate level of independence from the management of the Mizuho group. At Mizuho Financial Group, we have been disclosing the criteria for the Group CEO position as part of this report since December 2018 (see Supplementary Principle 4.1.3: Succession planning), and our Nominating Committee and Human Resources Review Meeting have been monitoring and discussing the state of our candidate pool. The members of the Nominating Committee regularly further their understanding of strategies and challenges in each department by holding discussions with group management through committee meetings and other opportunities. This also enables them to keep track of the abilities and attributes of management. 【Group CEO selection process】 In light of the resignation of the Group CEO and the challenges faced by the Mizuho group, the Nominating Committee engaged external evaluators for extensive review on the criteria for the Group CEO position, as described below. The committee conducted multifaceted evaluations of candidates carefully selected from the talent pool, which included talent from outside of Mizuho, and interviewed each candidate multiple times. At its meeting on January 17, 2022, having concluded thorough deliberations, the committee decided that it would forward Mr. Kihara as a candidate for membership of the Board of Directors at the ordinary general meeting of shareholders to be held in late June 2022, under the assumption that Mr. Kihara will become the next Group CEO. It also decided that it would select Mr. Kihara as the Group CEO at the Board of Directors meeting to be held on the same day. 【Criteria for the Group CEO position (criteria of focus)】 In considering what attributes and abilities to focus on or otherwise include in its search for the next Group CEO, the Nominating Committee took into account the approach to the position criteria outlined in Supplementary Principle 4.1.3: Succession planning (2) 1) to 3); the current state of affairs in the world; the changes in the business environment surrounding Mizuho; the direction of group strategy going 9 forward; and other factors. Following is an outline of the priorities the Nominating Committee identified through the above process. – It is critical that the new Group CEO treat the series of IT system failures and other issues with the utmost seriousness, be fully committed to our customers, and ensure stable operations, while also assisting the group in turning over a new leaf and leading the entire group in a more positive direction. – It is essential that the new Group CEO maintain and advance our strategies and reforms for our transition to the next generation of financial services. Based on these priorities, the Nominating Committee determined that the next Group CEO should be a professional who can accurately assess the current situation, coordinate among the Mizuho group, elevate the discipline and capacity of our organization, understand the direction of overall group strategies and reforms, and apply these skills to formulating and executing group strategies going forward. With this vision for the candidate established, the committee decided to focus its selection on the candidates’ ability to drive change and innovation, lead the organization, persevere, exercise impact and influence, think insightfully, and demonstrate curiosity. 【Selection of the Group CEO】 Mr. Kihara possesses the abovementioned attributes and abilities. He also has a broad outlook, rational judgment, outstanding decisiveness, and excellent management skills. Above all, he is a leader who can motivate his colleagues and guide Mizuho into the future. Within the Mizuho group, he has worked in corporate planning, financial planning, risk management, investment banking coordination, and markets coordination, among other areas. This has given him wide-ranging business experience and made him intimately familiar with all of our operations. For these reasons, the Nominating Committee has unanimously agreed that Mr. Kihara is the most suitable candidate to become the next Group CEO at this time. [Principle 4.8] (Effective Use of Independent Directors) The Board of Directors shall not have more than fifteen (15) directors, which is the number of directors prescribed under the Articles of Incorporation. In light of the role of the Board of Directors to supervise the management, non-executive directors (outside directors and internal directors who do not concurrently serve as executive officers, managing directors, employees, or executive directors of MHFG or any subsidiary of MHFG) shall comprise a majority of the directors in the Board of Directors, while at least six (6) directors shall be outside directors (to fulfill the “Independence Standards of Outside Directors of the Company”). As of today, six (6) out of twelve (12) directors are outside directors. With regard to our perspectives on the composition of the Board of Directors, MHFG has provided such information in “Composition of the Board of Directors” of its “Corporate Governance Guidelines”. https://www.mizuhogroup.com/who-we-are/governance/governance/g_report#guideline. [Principle 4.9] (Independence Standards and Qualification for Independent Directors) For MHFG’s “Overview of Independence Standards of Outside Directors of the Company,” see “II. 1 【Independent directors】Other matters regarding independent directors” of this report. [Supplementary Principle 4.11.1] (Preconditions for Board Effectiveness) With regard to MHFG’s perspectives on the balance of knowledge, experience and capability, diversity and size of the Board of Directors as a whole, as well as its policies and procedures to determine candidates for directors, MHFG has provided such information in “Composition of the Board of Directors,” “Appointment and Dismissal of Directors” and “Operation of the Nominating Committee” of its “Corporate Governance Guidelines”. https://www.mizuhogroup.com/who-we-are/governance/governance/g_report#guideline. 10 For your reference, the Board of Directors consists of twelve (12) directors (one (1) is female), among whom six (6) are outside directors having experience in corporate management, in financial institution management, as a lawyer, as a certified public accountant, etc., three (3) are internal directors who do not serve as persons performing executive roles and three (3) are directors serving as executive officers. Skills including experience and expertise of each Board of Directors are shown in “Convocation Notice of the 19th Ordinary General Meeting of Shareholders”. https://www.mizuhogroup.com/binaries/content/assets/pdf/mizuhoglobal/investors/financial-information/stock-information/meeting19_3_eng.pdf [Supplementary Principle 4.11.2] (Preconditions for Board Effectiveness) With regard to the status of major concurrent offices of candidates for directors and directors, MHFG provides such information on reference materials of the “notification of general meeting of shareholders” and other disclosure documents such as the Business Report on an annual basis. For the status of directors’ major concurrent positions as of the date of this report, see “II. 1. 【Matters regarding outside directors】—Relationship with the Company (2).” [Supplementary Principle 4.11.3] (Preconditions for Board Effectiveness) The Board of Directors shall perform an analysis and evaluation of the effectiveness of the Board of Directors as a whole each year and shall disclose a summary of the results. The Company shall have a third-party evaluation organization perform an evaluation at least once every three years for such self-evaluation. The operational policies of the evaluation of the effectiveness of the Board of Directors are stated in Article 9 Paragraph 4 of the “Corporate Governance Guidelines.” (https://www.mizuhogroup.com/who-we-are/governance/governance/g_report#guideline) For the methods, processes and results of the FY2020 evaluation, please refer to “Results of the Evaluation of the Effectiveness of the Board of Directors” on our company website. (https://www.mizuhogroup.com/who-we-are/governance/governance/g_report#evaluation) [Supplementary Principle 4.14.2] (Director Training) In order to fulfill their roles in the monitoring and advising functions of the Board of Directors, our directors proactively gather information and take efforts to be informed of the management environment and the state of business surrounding our Group. We provide our directors on a continuing basis with “opportunities to acquire and improve knowledge” that is necessary to fulfill their expected roles and duties. We shall provide newly appointed directors with opportunities when taking office to acquire the knowledge necessary to fulfill the roles and responsibilities required of directors, such as information on the Companies Act, other related laws and regulations as well as corporate governance, and shall provide each director on a tailor-made basis with such opportunities after taking office as necessary. In addition, for outside directors, each outside director is offered opportunities to acquire the necessary knowledge about our Group’s business, finance and organizational structure at the time of appointment and continuously thereafter. The training policy for directors is described in Article 6 Paragraph 6 of the “Corporate Governance Guidelines.” (https://www.mizuhogroup.com/who-we-are/governance/governance/g_report#guideline) 1. “Opportunities to acquire and improve knowledge” for all directors • Conduct training programs by external instructors (lawyers) centered on the duties and responsibilities of directors for our newly appointed directors of MHFG and the Three Core Companies, etc. • Help directors to comprehensively understand Mizuho’s management as a whole through various discussions and reports at the Board of Directors meetings 11 • • • Conduct training programs in regard to risk management by external instructor in light of the system failures at Mizuho Bank (for Board of Directors and Executive Officers of MHFG and the Three Core Companies) • Annual scheduled training sessions (for directors and executive officers, etc. of our group) regarding “Compliance and Customer Protection” and “Human Rights” by external instructors If necessary in executing duties, opportunities are to be offered to receive separate explanations from executive officers in charge, etc., as well as advice from and training by external specialists and authorities (at the company’s expense) 2. “Opportunities to acquire and improve knowledge” for outside directors ◆ At the time of appointment “Intensive explanations at the time of appointment” will be conducted individually for each newly appointed outside director Explanations from executive officers in charge and the General Manager of the Corporate Secretariat on corporate identity, business, strategy, business plans, finance and governance system, etc. ◆ Post-appointment (Shown below are examples conducted for the fiscal year ended March 31, 2022) • Outside Director Session* For the fiscal year ended March 31, 2022, Outside Director Session was held 8 times, and outside directors exchanged information to share understanding and exchanged opinions on management of the Board of Directors, and the corporate governance system. *For more information on the role, composition and operation of the Outside Director Session, see the subsection, “Outside Director Session” under “2. Matters regarding the function of execution of duties, audit and supervision, appointment, decisions on compensation, etc. (Overview of current corporate governance structure)” in “II. Status of corporate governance system in managerial decision making, management control system regarding enforcement and supervision and others.” • Off-site meetings on management issues • • For the fiscal year ended March 31, 2022, off-site meetings on management issues was held 8 times, and enable a deeper mutual understanding with outside directors through free discussions with President & Group CEO, as well as heads of in-house groups. Thorough explanations of proposals prior to the Board of Directors meetings and implementation of follow-up (after each meeting) Help outside directors to deepen the understanding towards the proposals and to substantiate the discussions at the Board of Directors meetings by explaining not only the structure of proposals, but also details such as the relevant financial terminologies and business matters. 3. “Opportunities to acquire and improve knowledge” for internal officers ◆ Similarly to directors, we provide our internal executive officers on a continuing basis with “opportunities to acquire and improve knowledge” that is necessary to fulfill their expected roles and duties. • Conducting “case studies for newly appointed officers” Root cause analysis of past crises to deepen the understanding of the awareness and actions required of officers and leaders during crisis management. • Conducting training sessions into “fundamental knowledge of crisis management reporting” • Conducting annual “business continuity management training sessions” Conducted annually on a scheduled basis to deepen the understanding of the group’s business continuity management framework, emergency procedures and crisis management procedures for those who have not received lessons or experienced such crises in the past. 12 • Compliance training sessions for newly appointed officers, etc. [Principle 5.1] (Policy for Constructive Dialogue with Shareholders) The Board of Directors resolved to establish the “Disclosure Policy,” which summarizes basic principles regarding disclosure including investor relation activities for promoting constructive dialogue with shareholders and framework of disclosure controls and procedures, and MHFG has published in Integrated Report (Annual Review) and on our website at https://www.mizuhogroup.com/investors/financial-information/ir-information/policy. In addition, see “III. 2. Our IR activities” for details of IR activities, etc. MHFG has published matters regarding corporate governance on its website at https://www.mizuhogroup.com/who-we-are/governance. 13 2. Capital structure Foreign stockholding ratio Over 20 % and less than 30 % 【Major Shareholders】 (Common Stock) Name of Shareholders Shares held Percentage of outstanding shares The Master Trust Bank of Japan, Ltd. (Trustee account) 349,733,000 13.77 Custody Bank of Japan, Ltd. (Trustee account) State Street Bank West Client – Treaty 505234 JP Morgan Chase Bank 385781 Custody Bank of Japan, Ltd. (Trustee account 7) SMBC Nikko Securities Inc. Custody Bank of Japan, Ltd. (Trustee account 4) State Street Bank And Trust Company 505103 Custody Bank of Japan, Ltd. (Taxable trust money account) Barclays Securities Japan Limited 112,900,800 46,310,795 32,915,674 30,827,000 27,331,860 27,199,560 26,983,521 26,417,250 23,377,000 4.44 1.82 1.29 1.21 1.07 1.07 1.06 1.04 0.92 Controlling shareholder (excluding parent company) Parent company 3. Company attribution Stock exchange and market section Fiscal year end Industry type (Consolidated) Number of employees as of latest fiscal year end (Consolidated) Sales as of latest fiscal year end Number of Consolidated Subsidiaries as of latest fiscal year end None None Tokyo / Prime March Bank Over 1,000 Over 1 trillion yen Over 100 and less than 300 companies 4. Other important matters having a significant bearing on corporate governance Mizuho has introduced an in-house company system based on the group’s diverse customer segments. The aim of this system is to leverage Mizuho’s strengths and competitive advantage, which is the seamless integration of Mizuho’s banking, trust, securities, asset management and research and consulting functions under a holding company structure, to speedily provide high-quality financial services that closely match customer needs. With increased strength and speed, each in-house company can develop consistent strategies according to the attributes of its customers during all processes from the formulation of strategy to its execution across several entities. MHFG, as a holding company, shall administer each company of Mizuho to ensure that self-discipline and accountability of management of Mizuho are fully functioning. In order to achieve the goal set out mentioned above, the Company has established its Group Management Administration Regulations and shall administer key group companies under group management administration agreements. In particular, in administering the Three Core Companies, MHFG’s Board of Directors, Nominating Committee, and Compensation Committee shall approve matters such as the appointment and dismissal of directors of the Three Core Companies, appointment and removal of ’ executive officers (as defined in our internal regulations) with special titles of the Three Core Companies, and compensation for each individual director of the Three Core Companies. 14 Each of the Three Core Companies has chosen to adopt the “Company with Audit and Supervisory Committee” structure. Each of them aims to realize a higher level of supervision by the Board of Directors and swifter decision-making, in order to perform its roles more effectively under the Group’s in-house company system. Thus, the Group will further enhance its corporate governance on a group basis. 15 II. Status of corporate governance system in managerial decision making, management control system regarding enforcement and supervision and others 1. Matters regarding form of organizational structure and operation, etc. Company with Three Committees Form of organization 【Board Members】 Number of directors provided for in the Articles of Incorporation Term of office of directors provided for in the Articles of Incorporation Chairman of the Board of Directors Number of board members Status of outside directors appointment Number of outside directors (Number of independent directors) Relationship with the Company (1) 15 1 year Outside Director 12 Appointed 6 (6) Name Attribution Tatsuo Kainaka Lawyer Yoshimitsu Kobayashi From other company Ryoji Sato Certified Public Accountant Takashi Tsukioka From other company Masami Yamamoto From other company Relationship with Company a b c d e f g h i j k From other company Izumi Kobayashi *Relationship with the Company ○: Outside director herself/himself is currently applicable or was applicable until recently △: Outside director herself/himself was applicable in the past ●: Close relative of the outside director is currently applicable or was applicable until recently ▲: Close relative of the outside director was applicable in the past a. A person performing an executive role at a listed company or its subsidiary b. A person performing an executive role or non-executive director at a listed company’s parent company c. A person performing an executive role at a listed company’s affiliate d. A person who has a listed company as a major customer or a person performing an executive role at a listed company who has the listed company as a major customer e. A listed company’s major customer or a person performing an executive at a listed company’s major customer f. A consultant, accountant or lawyer who receives from a listed company a large amount of money or other property benefit g. A major shareholder of a listed company (if the shareholder is an entity, then a person performing an executive role at the other than the executive compensation entity) h. A person performing an executive role (only her/himself) of a listed company’s major customer (other than d, e and f) i. A person performing an executive role (only her/himself) of a company that has an outside director from MHFG j. A person performing an executive role (only her/himself) of a company to which a listed company makes donations k. Others 16 Relationship with the Company (2) Name Independent Additional information regarding director applicable items Reason for appointment as an outside director (including reason for designation as an independent director, if applicable) Tatsuo Kainaka (Status of Major Concurrent Mr. Kainaka has served in positions such as *Committees: -Nominating Committee -Compensation Committee -Audit Committee Other “Company Names where among others, (i) strengthening the effectiveness Office) Superintending Prosecutor of the Tokyo High Attorney-at-law at Takusyou Public Prosecutors Office and Justice of the Sogo Law Office Supreme Court, and he is currently active as an Corporate Auditor (External) of attorney-at-law. MHFG has proposed to appoint Oriental Land Co., Ltd. him as an outside director based on its conclusion that he will be able to significantly contribute to, Outside Directors Serve of both the decision-making and supervisory Concurrent Positions” (whether functions of MHFG’s Board of Directors, and (ii) or not such outside directors the further enhancement of corporate serve concurrent positions of governance, compliance and risk management business system of Mizuho, from a perspective counterparties, beneficiaries of independent from that of the management, donations, etc., or formerly with leveraging his extensive experience, deep insight such entities and a brief and high level of expertise. He has been description of the relationships) is appointed to assume the office of director at the omitted pursuant to our ordinary general meeting of shareholders held in immateriality standards (see “—June 2021. Other matters regarding Seven (7) years have passed since he started to independent directors” for an assume the office as an outside director of MHFG overview hereof). until the closing of the ordinary general meeting of shareholders held in June 2021. He attended all of a total of fifteen(15) Board of Directors meetings, a total of seven(7) Nominating Committee meetings, a total of five (5) Compensation Committee meetings, and a total of seventeen(17) Audit Committee meetings, held during the fiscal year ended March 31, 2021. By leveraging his extensive experience, deep insight and high level of expertise in the legal profession, he played a role at the Board of Directors Meeting in ensuring the appropriateness of decision-making by, among other matters, making suggestions concerning (i) the desirable corporate governance and (ii) compliance policies. In addition, at the Nominating Committee, as the Chairman, he took initiatives in strengthening supervisory functions by, among other matters, leading the decision-making and approval processes for directors’ personnel in a thorough manner to realize optimal personnel placements. 17 He satisfies the “Independence Standards of Outside Directors of MHFG” established by MHFG. The relationship between him, as an attorney-at-law, and Mizuho does not affect his independence, for reasons including that he or the law office to which he belongs, i.e., Takusyou Sogo law office, has not received any money or property benefit from Mizuho other than the compensation receiving as an outside director of MHFG. (See “—Other matters regarding independent directors” for Overview of “Independence Standards of Outside Directors of MHFG.”) Considering the above, MHFG has determined that Mr. Kainaka is an outside director as required by the Tokyo Stock Exchange that is unlikely to give rise to conflicts of interest in relation to general shareholders and reported him as an independent director. 18 Yoshimitsu Kobayashi *Committee: -Nominating Committee (Status of Major Concurrent Office) Mr. Yoshimitsu Kobayashi has served as Representative Director, Member of the Board, Director of the Board of President, Chairperson of Mitsubishi Chemical Mitsubishi Chemical Holdings Holdings Corporation, he is currently active as Corporation Director of the Board of this company. MHFG Chairman of the Board of has proposed to appoint him as an outside Directors (Outside Director) of director based on our conclusion that he will be Tokyo Electric Power Company able to significantly contribute to, among other Holdings, Inc. matters, strengthening the effectiveness of both Director of the Board of The the decision-making and supervisory functions of KAITEKI Institute, Inc. the Board of Directors, from a perspective independent from that of the management, Other “Company Names where leveraging his extensive experience as a senior Outside Officers Serve executive of a global corporation and deep insight Concurrent Positions” (whether in corporate governance. He has been appointed or not such Outside Directors to assume the office of Director at the ordinary serve concurrent positions of general meeting of shareholders held in June business counterparties, 2021 beneficiaries of donations, etc., or formerly with entities and a brief One (1) year has passed since he started to description of the relationships) is assume the office as an outside director of MHFG omitted pursuant to our until the closing of the ordinary general meeting immateriality standards (see “—of shareholders held in June 2021. Other matters regarding independent directors” for an He attended all of a total of twelve(12) Board of overview hereof). Directors meetings, and a total of six(6) Nominating Committee meetings, held during the fiscal year ended March 31, 2021, after his appointment as directors of Mizuho Financial Group in June 2020. By leveraging his broad experience and deep insight about corporate governance as a senior executive, he played a role, at the Board of Directors Meeting, in ensuring the appropriateness of decision-making by, among other matters, making suggestions in improving (i) policies for sustainability and (ii) crisis management. In addition, at the Nominating Committee, he contributed to strengthening supervisory functions by, among other matters, making appropriate hiring that optimizes personnel placements. He satisfies the “Independence Standards of Outside Directors of MHFG” established by MHFG. The business relationship between Tokyo Electric Power Company Holdings, Inc., where he serves as the Chairman of the Board of Directors (outside director), and Mizuho does not affect his independence, for reasons including 19 that (i) the percentage of sales gained through the business with Mizuho of the consolidated net sales of Tokyo Electric Power Company Holdings, Inc. and (ii) the percentage of gross profits gained through the business with group companies of Tokyo Electric Power Company Holdings, Inc. of the consolidated gross profits of MHFG, are less than 1%, respectively. (See “—Other matters regarding independent directors” for Overview of “Independence Standards of Outside Directors of MHFG.”) Considering the above, MHFG has determined that Mr. Kobayashi is an outside director as required by the Tokyo Stock Exchange that is unlikely to give rise to conflicts of interest in relation to general shareholders and reported her as an independent director. 20 Ryoji Sato (Status of Major Concurrent *Committee: -Audit Committee Office) Audit & Supervisory Board Mr. Ryoji Sato has served in positions such as CEO of Deloitte Touche Tohmatsu LLC and Chairman of the Audit Committee of Toshiba Member of Nippon Life Corporation, and he is currently active as a Insurance Company certified public accountant. MHFG has propose to appoint him as an outside director based on our Other “Company Names where conclusion that he will be able to significantly Outside Officers Serve contribute to, among other matters, strengthening Concurrent Positions” (whether the effectiveness of both the decision-making and or not such Outside Directors supervisory functions of the Board of Directors serve concurrent positions of from a perspective independent from that of the business counterparties, management, leveraging his extensive experience, beneficiaries of donations, etc., or deep insight and high level of expertise. formerly with entities and a brief He has been appointed to assume the office of description of the relationships) is director at the ordinary general meeting of omitted pursuant to our shareholders held in June 2021. Further, he has immateriality standards (see “—considerable expert knowledge concerning Other matters regarding finance and accounting as a certified public independent directors” for an accountant. overview hereof). One (1) year has passed since he started to assume the office as an outside director of MHFG until the closing of the ordinary general meeting of shareholders held in June 2021. He attended all of a total of twelve(12) Board of Directors meetings, and a total of eleven(11) Audit Committee meetings, held during the fiscal year ended March 31, 2021, after his appointment as directors of Mizuho Financial Group in June 2020. By leveraging his extensive experience, deep insight and high level of expertise in finance and accounting as a certified public accountant, he played a role, at the Board of the Directors Meeting, in ensuring the appropriateness of decision-making by, among other matters, making suggestions concerning shareholder return policy. In addition, at the Audit Committee, he contributed to strengthening supervisory functions through financial reporting and promoting accounting audit that takes into account international trends. He satisfies the “Independence Standards of Outside Directors of MHFG” established by MHFG. With respect to the relationship between him, as a certified public accountant, and Mizuho does not affect his independence, for reasons including 21 that he has not received any money or property benefit from Mizuho other than the compensation receiving as an outside director of MHFG. (See “—Other matters regarding independent directors” for Overview of “Independence Standards of Outside Directors of MHFG.”) Considering the above, MHFG has determined that Mr. Sato is an outside director as required by the Tokyo Stock Exchange that is unlikely to give rise to conflicts of interest in relation to general shareholders and reported her as an independent director. 22 Takashi Tsukioka (Status of Major Concurrent Mr. Takashi Tsukioka has served as *Committee: -Nominating Committee -Compensation Committee -Audit Committee Office) Representative Director President and Chief Special Advisor of Idemitsu Executive Officer, and Chairman and Kosan Co., Ltd. Representative Director of Idemitsu Kosan Co., Ltd. and President of Petroleum Association of Other “Company Names where Japan. MHFG has propose to appoint him as an Outside Officers Serve outside director based on our conclusion that he Concurrent Positions” (whether will be able to significantly contribute to, among or not such Outside Directors other matters, strengthening the effectiveness of serve concurrent positions of both the decision-making and supervisory business counterparties, functions of the Board of Directors from a beneficiaries of donations, etc., or perspective independent from that of the formerly with entities and a brief management, leveraging his deep insight that he description of the relationships) is has cultivated in Japan and overseas as a senior omitted pursuant to our executive in the energy field and his extensive immateriality standards (see “—knowledge and expertise pertaining to Other matters regarding sustainability through, among other matters, independent directors” for an renewable energy. He has been appointed to overview hereof). assume the office of director at the ordinary general meeting of shareholders held in June 2021. He satisfies the “Independence Standards of Outside Directors of MHFG” established by MHFG. (See “—Other matters regarding independent directors” for Overview of “Independence Standards of Outside Directors of MHFG.”) Considering the above, MHFG has determined that Mr. Tsukioka is an outside director as required by the Tokyo Stock Exchange that is unlikely to give rise to conflicts of interest in relation to general shareholders and reported her as an independent director. 23 Masami Yamamoto (Status of Major Concurrent Mr.Yamamoto has served as Representative *Committee: -Nominating Committee -Compensation Committee Office) Director, President and Representative Director, Dire