Interview with the Independent Outside Directors Interview with the Independent Outside Directors

Reexamining Shindengen’s core from my perspectives as an attorney and as a woman, I will strive to help build a corporate business structure for the next growth stage.

Yaeko Kitadai
Independent Outside Director

Q1Could you tell us about the role expected of outside directors and your approach to that role?

My career has been as a practitioner of law, so I do not have much experience in corporate management. I do not bring technical knowledge in the power electronics field where Shindengen operates, either. Rather, I will strive to enhance Shindengen’s corporate value by leveraging my knowledge and experience as an attorney.

Laws have a purpose, and complying with them yields certain effects. I would like to focus on promoting this mindset throughout the Company and work to advance awareness and understanding of governance.

As a woman, the other aspect of my role has to do with providing diversity on the Board of Directors. I aim to add to the diversity of views expressed not only from my perspective as a woman, but also by contributing to discussions from a user perspective and based on my experience as an outside officer at other companies.

Q2Please tell us your thoughts about the challenges and risks related to increasing the Shindengen Group’s corporate value based on your area of expertise.

Under the 16th Medium Term Business Plan, Shindengen seeks to build a foundation aimed at the realization of Long-Term Vision 2030 and has set the target of ¥118 billion in net sales for fiscal 2024, the final year of the plan. To expand in scale, much like the importance of core strength for an athlete, I think that Shindengen will need to make sure its core is solid. For a company, core strength means corporate structures and systems.

I think that transforming its corporate structures and systems—including governance—in line with the expansion of net sales will contribute to the sustainable enhancement of corporate value. This is an area I would like to focus on.

Q3Is there anything you want to especially focus on over the next year?

As I said, I am an attorney, and my knowledge of management is limited, so my appointment as outside director has felt a little bit like being dropped into a roller coaster racing forward at top speed. To begin with, I am working to really understand the Shindengen Group’s operating environment and businesses and get a grip on the many aspects of the Company as quickly as possible so that I can then provide appropriately informed opinions.

In my experience serving as an outside officer at a number of companies, I have keenly felt that each has its own unique culture and character. If a company’s culture and character reinforce one another in a virtuous cycle, all is well. However, if they are out of step with the broader world, they can slip into a vicious cycle, instead. I think that if I ever see any hints of that happening at Shindengen, it will be important to speak up unreservedly.

Q4Do you have any message for stakeholders?

I think that Shindengen is engaged in businesses that contribute tremendously to the realization of a sustainable society. I suspect that many of the Shindengen Group’s stakeholders are involved with the Group because that appeals to them.

Before I was appointed as a director, I saw a video of the previous president introducing the Asaka Office and was very impressed by the workplace environment. It was easy to imagine how Shindengen’s employees could work happily and healthily, both in terms of the physical building and interpersonal relationships. I am very proud to take part in the direction of such a company. To live up to the expectations placed on me in this role and help enhance corporate value, I hope ask frank and open questions as a starting point for contributing to a diverse range of viewpoints.

I will strive to provide insight based on my experience in global management to help Shindengen to sustainably grow by developing its potential to meet society’s needs.

Yoshihiro Nishiyama
Independent Outside Director

Q1Could you tell us about the role expected of outside directors and your approach to that role?

Shindengen’s history began with its founding business in power sources, from there branching off into electronic parts for motorcycles and the Electronic Device Business and then further developing to include environmentally friendly products, chargers for EVs and other products. Effectively allocating limited management resources by selecting businesses to stay in and those to discard is extremely important in corporate management. Rather than skewing investment toward established businesses, sustainable corporate growth requires proactive investment in new areas, as well. I will offer my views to the Board of Directors from a perspective that emphasizes that balance.

After joining Nippon Mining Co. in 1978, I worked in that group for more than 40 years in businesses related to copper, titanium and other metal materials. During that time, I took part in a project in South Korea and was stationed overseas twice. My experience also includes close involvement in copper mining projects through the group’s equity participation in mines in Chile, the world’s greatest producer of copper.

I thus have business experience both in Japan and overseas. Leveraging this experience, I hope to provide advice from a global management perspective that will be useful for Shindengen’s wide-ranging businesses in and outside Japan. I also have experience in both foundational businesses that do not have particularly high growth rates and businesses that are small in scale but rapidly growing, that is, businesses downstream of the metal materials business.

Q2Based on your area of expertise, please share your thoughts on the challenges and risks related to increasing the Shindengen Group’s corporate value.

Doing business always involves risk. Preventing risks from materializing, be it through safety measures or governance, is therefore a top priority. However, it is also important to address risks of unpredictable developments, such as the rising prices and shortages of a variety of materials caused by the Russia-Ukraine conflict. The wide range of Shindengen’s businesses, including those overseas, presumably entails a similarly wide array of risks. As such, I think that one important role of the Board of Directors is to decide when to cut the Company’s losses when such risks arise and to formulate exit strategies.

However, I think the most essential thing will be to center discussions on Long-Term Vision 2030 and look for ways of putting it into action. I will endeavor to carefully check how plans are progressing, whether they have stalled, or whether some parts need to be changed, as all of these are crucial data points for making management decisions.

Q3Is there anything you want to especially focus on over the next year?

In my previous job, as the president of a company, I was on the receiving end of the valuable opinions of our outside directors. They often provided incisive views from angles I had not thought of, which was extremely helpful. Now, I’m in the opposite role, and one of my missions is providing Shindengen’s president and top management with opinions from a different angle than they might perceive themselves. To do so, I will work to gain a keen, first-hand understanding of conditions within Shindengen through on-site observation.

The structure of each business—such as the competitive environment and market trends by countr—varies. As such, I will seek to gain specific knowledge by hearing about each business from the people running them and scrutinizing these areas in detail, so that I can quickly offer informed opinions.

Q4Do you have any message for stakeholders?

Looking at the perception of Shindengen in capital markets, the Company’s price-to-book ratio (PBR) is currently below 1. I see this as an important issue, and Shindengen is currently in the middle of efforts to develop a more free and open corporate culture.

As stated in Long-Term Vision 2030, I feel that Shindengen has business potential in areas that can meet the needs of society.

I think that Shindengen’s employees should take confidence and pride from this, and show off the Company’s technological capabilities, brand strength and culture to society at large while forcefully advancing business. By doing so, I think that Shindengen can grow into a power electronics company whose true worth is fully appreciated both internally and externally, including by capital markets.

I ask Shindengen’s shareholders for their support of the Company, its leadership and employees.

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