Corporate Governance

Structure

Corporate Governance Structure of Shimizu Corporation

Expand

Close

Overview of the Corporate Governance Structure

We have adopted the structure of a company with an Audit & Supervisory Board. We have chosen this system based on the belief that we have established a system to supervise and oversee management from an objective and neutral perspective. This was achieved by limiting the number of directors and introducing an executive officer system to clearly separate the management strategy decision-making and oversight functions from the business execution function, by taking steps to encourage energetic debate at the Board of Directors, and by electing outside directors, other non-executive directors, and outside Audit & Supervisory Board members who maintain a high degree of independence. The concrete structure and implementation status are detailed below.

• One-third or more of the Board of Directors elected are outside directors to strengthen management supervision function, and to promote more energetic debate by the Board of Directors.
• Outside directors and other non-executive directors and outside Audit & Supervisory Board members use their extensive experience and sophisticated insight based on their individual career histories to oversee and supervise management and provide necessary advice as appropriate.
• We established a structure mainly consisting of the head office administrative departments to provide timely information and other materials to assist outside directors and other non-executive directors in performing their management supervisory duties (including tours of offices, job sites, etc.).
• The relevant divisions provide guidance on the Company in general, description of its businesses, and other relevant information to new outside directors and outside Audit & Supervisory Board members.
• Audit & Supervisory Board members audit all duties performed by directors from a fair and impartial perspective.
• The Audit & Supervisory Board Members Office was established as the dedicated organization to support Audit & Supervisory Board members. This office secures the necessary support staff to enable more effective audits by Audit & Supervisory Board members.
• Audit & Supervisory Board members improve the effectiveness of management supervision by attending important meetings and obtaining sufficient information from officers and employees without delay.
• When a Board of Directors meeting is held, the Board of Directors administrative office and other divisions provide explanations in advance to the outside directors, non-executive directors, and Audit & Supervisory Board members.
• Outside directors and other non-executive directors regularly exchange opinions with the chairman and president. They also exchange opinions with outside Audit & Supervisory Board members.
• Regular Outside Officers Meetings are held for outside directors and outside Audit & Supervisory Board members, and regular Outside Directors and Audit & Supervisory Board Members Meetings are held for outside directors and all Audit & Supervisory Board members to facilitate the exchange of opinions.

Main Governing Bodies Established by Shimizu (including discretionary committees and other meeting formats)

Board of Directors

In principle, the Board of Directors meets once a month and, as necessary, to decide matters stipulated by laws and regulations, the Articles of Incorporation, and the Board of Directors Regulations, as well as other important matters, and to supervise the execution of operations. The Articles of Incorporation specifies 12 as the maximum number of directors. These directors consist of executive directors who are highly knowledgeable in each area of our business and non-executive directors, some of whom are outside directors with extensive expertise and experience in their respective specialties. The Chairman and Representative Director serves as the chair of the Board of Directors.

［Names and Titles of Members］　(11 as of June 26, 2026)

(Main Agenda Items)
Election of directors; organizational reform; establishment, revision or repeal of company regulations; formulation and supervision of management policies and strategies; monitoring of progress and growth strategies of each business; risk management; sustainability matters such as climate change and human resources development; feedback on dialogue with investors; reduction of securities holdings; and revision of the standards for referral to the Board of Directors.

Audit & Supervisory Board

The Audit & Supervisory Board meets once a month as a rule, and additionally as necessary. It makes decisions on audit policy, audit plans, auditing methods, and other important audit matters, and deliberates on necessary matters concerning audits. The Articles of Incorporation sets the number of Audit & Supervisory Board members at a maximum of five, including three outside Audit & Supervisory Board members. The chair of the Audit & Supervisory Board is an Audit & Supervisory Board member chosen through discussion by the Audit & Supervisory Board.

［Names and Titles of Members］　(five as of June 26, 2026)

Nomination & Compensation Committee

We have established a Nomination & Compensation Committee to ensure fairness and transparency in the selection and dismissal of directors, Audit & Supervisory Board members and executive officers, as well as evaluation and compensation of directors and executive officers. The scope of responsibilities of the Committee is defined in the Rules of the Nomination and Compensation Committee and other related regulations. The members of this committee consist of five non-executive directors (four outside directors and one non-executive internal director) and one executive director. The committee is chaired by a non-executive director elected every year from among the members.

［Names and Titles of Members］　(six as of June 26, 2026)

(Main Agenda Items)
Formulation of personnel proposals for directors/executive officers and individual evaluations; total amount of bonuses for directors/executive officers and individual bonuses; individual monthly compensation for the following fiscal year; succession plans; organizational Composition; verification and review of related rules and regulations, etc.

Risk Management Committee

Our Risk Management Committee ascertains and analyzes risks that would have a serious impact on our corporate group, which consists of Shimizu and its subsidiaries. It also determines key items of risk management, and follows up and reports to the Board of Directors. The President and Representative Director serves as the chair of the committee and one standing Audit & Supervisory Board member also attends committee meetings. The roles, authority, and other matters of the Risk Management Committee are defined in the Risk Management Regulations.

［Names and Titles of Members］　(14 as of June 29, 2026)

Committee on Corporate Ethics

Shimizu has established the Committee on Corporate Ethics to decide company-wide measures for thoroughly promoting corporate ethics and compliance, implement and follow up on those measures, centralize information on serious misconduct cases, and review and direct preventive measures and recurrence prevention measures. The President and Representative Director serves as the chair of the committee. One full-time Audit & Supervisory Board member and one outside expert (an attorney) also attend committee meetings.

［Names and Titles of Members］　(19 as of June 29, 2026)

Executive Officers Council

We have established an Executive Officers Council to communicate important matters and policies decided by the Board of Directors to executive officers and provide instructions to them. The President and Representative Director serves as the chair of this council and members consist of executive directors (other than the chair) and executive officers. Two full-time Audit & Supervisory Board members also attend council meetings.

Evaluating the Effectiveness of the Board of Directors

Our Board of Directors evaluates the overall effectiveness of the Board of Directors once a year.
A summary of the evaluation method and results for fiscal 2025 are provided below:

Evaluation Method

All directors and Audit & Supervisory Board members complete a survey (including anonymous entries and open answers). A self-analysis is performed through discussion by all directors and all Audit & Supervisory Board members at Board of Directors meetings, based on an analysis by a third party (attorney).

Summary of Evaluation Results

Conclusion: The Shimizu Board of Directors evaluated and determined the Board of Directors as a whole to be operating effectively.

Status of response to issues indicated in the last evaluation of effectiveness in FY2024 (covering April 2024 to March 2025)

The Board of Directors has made consistent efforts to resolve issues and make improvements as follows. The Board of Directors will continue to strive for further improvement.

1. Hold in-depth discussions on business portfolio optimization to enhance corporate value

   ・

   Hold more in-depth discussions on growth strategies for each line of business considering the cost of capital at the Board of Directors meetings, and clearly define roles of each line of business in a company-wide scheme to enhance corporate value.

   →

   At the Board of Directors meetings discussions were held on growth strategies and key challenges for each business, including those conducted during off-site meetings.
   At the “Dialogue Session on the Mid-Term Business Plan” held for all employees, the senior management explained the roles and expectations for each business, and the feedback received from employees was shared with the Board of Directors.
2. Further improve internal control and risk management systems to realize teachings of our Credo, the Analects and the Abacus, in our operation

   ・

   Establishment of a more rapid reporting system for high-risk cases, and systematization of reporting on the progress and completion of responses.

   →

   The reporting structure for incidents such as disasters explicitly includes reporting lines to non-executive directors and the Board of Audit & Supervisory Board members. With regard to follow-up progress reports, ensure they are conducted thoroughly by utilizing opportunities such as advance briefings to the Board of Directors.
3. Enhance the communication between our senior management and outside directors/outside Audit & Supervisory Board members

   ・

   Provide more opportunities for our senior management and outside directors/outside Audit & Supervisory Board members to talk to each other in person outside the Board of Directors’ Meeting.

   →

   Opinion exchange meetings were held between non-executive directors/outside Audit & Supervisory Board members and division heads or branch executives, utilizing time after the Board of Directors meetings or opportunities during construction site visits.

Major issues identified in the effectiveness evaluation.

1. Enhance discussions on embedding cost-of-capital awareness and build an appropriate business portfolio.

   ・

   Enforce capital discipline in investment decisions across all lines of business based on discussions regarding the cost of capital, and deepen our deliberations to achieve an optimal business portfolio from a company-wide perspective.

2. Further enhance the efficiency and effectiveness of the Board of Directors to facilitate high-level, strategic discussions.

   ・

   Enrich the information provided prior to Board of Directors meetings to improve the quality of deliberations on increasingly diverse and complex matters, thereby expanding the scope of strategic discussions.

3. Enhance discussions and visualize the progress of succession planning.

   ・

   Report to the Board of Directors as appropriate regarding development plans for key management personnel and initiatives to enhance the experience of potential successors.

Future initiatives

Based on the results of the evaluation of the effectiveness of the Board of Directors, we aim to enhance the effectiveness of the Board of Directors and further expand and reinforce corporate governance through the PDCA cycle to improve on issues.

Election of Outside Directors and Outside Audit & Supervisory Board Members

as of June 26, 2026

Criteria for Assessing Independence of Outside Directors and Outside Audit & Supervisory Board Members

Criteria for Assessing Independence of Outside Directors and Outside Audit & Supervisory Board Members(PDF：91KB)

Support Structure for Outside Directors and Outside Audit & Supervisory Board Members

We have established a system to provide information to facilitate supervision of management by outside directors and other non-executive directors in performing their duties. The administration departments in the head office play the main role in providing this information in a timely manner. The Corporate Auditor’s Office was established as a dedicated organization to support Audit & Supervisory Board members. A sufficient number of staff members have been secured to assist outside Audit & Supervisory Board members. When a Board of Directors meeting is held, materials are distributed in advance and the Board of Directors administrative office and other divisions provide explanations in advance to the outside directors and the outside Audit & Supervisory Board members.