December 17, 2018
Tokyo Stock Exchange, Inc.
Nikkei Inc.
Revision of Guidebook for JPX-Nikkei Index 400 and JPX-Nikkei Mid and Small Cap Index

The guidebooks for JPX-Nikkei Index 400 and JPX-Nikkei Mid and Small Cap Index, which are jointly
calculated by Tokyo Stock Exchange, Inc. (TSE) and Nikkei Inc. (Nikkei) have been revised as indicatedbelow.
1.

Key revisions to JPX-Nikkei Index 400(1) Criteria used for determining qualitative scores
Among the criteria used for determining qualitative scores, those under "Disclosure of English
earnings information" will be revised as follows.
TitleNewOld

III.JPX-Nikkei Index(Item)(Item)

400 Constituent

Disclosure of English earnings

Disclosure of English earnings

Selection 1.(2)⑤information and/or Corporateinformation

Governance Report(Criteria)(Criteria)

English documents regarding theEnglish documents regarding the most

most recent earnings information

recent earnings information areand/or Corporate Governancedisclosed via TDnet (Company

Report are disclosed via TDnet

Announcements Distribution Service in(Company Announcements

English) at the time of the base date

Distribution Service in English) at thetime of the base date
*Item(s) regarding "Appointment of independent outside directors" and "Adoption of IFRS", which arealso used for determining qualitative scores, will not be revised at this time.
(2) Index constituent selection process for periodic review
The process for selecting index constituents at the time of periodic review will be revised asfollows.

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Title

NewOldIII. JPX-Nikkei Index

ii. If the number of selected issues falls

ii. If 400 issues are not selected in400

below 400 in the preceding paragraph i.,

the preceding paragraph i., the topSelection

then the top ranking issues according toranking issues according to the1.(2) ⑦ (b)Periodic

the rankings in ⑥ above that meet therankings in ⑥above shall be

Review

two conditions indicated below shall beselectedtheselected until the number of constituents

constituents reaches 400.

Constituent

until

numberof

reaches 400.
-Either 3-year average ROE or latest
ROE surpasses the median ranking
in ③ above-

Ranking is at or within the top
ranking 400 issues in ⑥ above(New Item)iii. If the number of selected issues falls
below 400 in the preceding paragraphii., then the non-selected top ranking
400 issues according to the rankings in⑥ above shall be selected until thenumber of constituents reaches 400.
2．Key changes to JPX-Nikkei Mid and Small Cap Index(1) Criteria used for determining qualitative scores
Among the criteria used for determining qualitative scores, those under "Appointment of
independent outside directors" and "Disclosure of English earnings information" will be revised
as follows.
Title

NewOldIII. JPX-Nikkei Mid(Item)(Item)and Small Cap

Appointment of independent outside

Appointment of independent outside

Index Constituent

directors

directors

Selection 1.(2)⑥(Criteria)(Criteria)

Out of the total number of directors,

At least 2 independent outside

at least one-third or a minimum of

directors appointed on the base date

three directors are appointed as
independent outside directors on thebase date. If one-third of the total
number of directors is less than two,at least two independent outside
directors are appointed.
(Item)(Item)

Disclosure of English earnings

Disclosure of English earnings

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information and/or Corporate

information

Governance Report(Criteria)(Criteria)

English documents regarding theEnglish documents regarding the most

most recent earnings information

recent earnings information areand/or Corporate Governancedisclosed via TDnet (CompanyReport are disclosed via TDnet

Announcements Distribution Service in(Company Announcements

English) at the time of the base date

Distribution Service in English) at thetime of the base date
*Item(s) regarding "Adoption of IFRS", which is also used for determining qualitative scores, will not berevised at this time.
(2) Index constituent selection process for periodic review
The process for selecting index constituents at the time of periodic review will be revised in amanner that matches that of JPX-Nikkei Index 400 as follows.
TitleNewOld

III. JPX-Nikkei Mid

ii. If the number of selected issues falls

ii. If the number of selection stocks

and Small Cap Index

below 200 in the preceding paragraph i,falls below 200 in the preceding

Constituent Selection

the top ranking issues according to theparagraph i., the top ranking issues

1.(2)⑧(b)Periodic

rankings in ⑦ above that meet the two

according to the rankings in ⑦

Reviewconditions indicated below shall beabove shall be selected until theselected until the number of constituents

number of constituents reaches

reaches 200.

200.

-Either 3-year average ROE or latest
ROE surpasses the median ranking
in ④ above-Ranking is at or within the top
ranking 200 issues in ⑦ aboveiii. If the number of selected issues falls
below 200 in the preceding paragraphii., then the non-selected top ranking
200 issues according to the rankings in⑦ above shall be selected until thenumber of constituents reaches 200.

3(New Item)

3.

Effective Date

Revisions will go into effect on the next periodic review in August 2019.

Contact
Tokyo Stock Exchange, Inc.

Nikkei Inc.

Information Services

Index Business Office

TEL: +81-50-3377-7754

TEL: +81-3-6256-7341

Email: index@jpx.co.jp

Email: index@nex.nikkei.co.jp

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