Olympus’ Corporate GovernanceTransition to a Company with a Three Committees Board Structure
Olympus Corporation (the “Company”) adopted a resolution
to partial amendments to the articles of incorporation at theGeneral Meeting of Shareholders held on June 25, 2019.
The Company transitioned from a company with an Audit &Supervisory Board to a company with a Three Committees
Board Structure on the same day.

2.Reinforced Supervisory Function in Management
The Company will establish three committees: nominating
committee, compensation committee, and audit committee,
which consist of a majority of independent outside directors;
supervise management through the functions of eachcommittee; and build a more appropriate management
supervisory system.

Expected Effects of Shifting to a Three Committees
Board Structure
1. Acceleration of Management Decision Making andBusiness Execution Functions
Functions are separated based on the basic principle of“separation of corporate oversight and business execution”
in a “company with a three committees board structure.” The
Board of Directors focus on deciding important matters on coremanagerial ele-ments and overseeing business management.
The Company will seek to accelerate management decisionmaking and execution by delegating more authority to executive
officers concerning matters related to daily business execution.

3. Increased Transparency in Management
The nominating committee will consist of a majority of
independent outside directors who will decide candidates for
directors, while the compensation committee will consist ofa majority of independent outside directors who will decide
remuneration of directors and executive officers. These
committees will improve the transparency of director andexecutive officer assignment and remuneration decisions.
The Company will seek to further increase its managementtransparency to domestic and foreign stakeholders.

Corporate Governance Structure (Before Shifting to a Three Committees Board Structure)
General Meeting of Shareholders
Appointment / Dismissal

Appointment / Dismissal

Appointment / Dismissal

Board of Directors

Audit & Supervisory Board
Cooperation

2 standing and2 outside Audit & Supervisory Board members

Accounting Auditor
Cooperation
Cooperation

Audit

Office of Audit &Supervisory Board

Discussions /Proposals

5 directors and6 outside directors
Chairperson: Non-executive director
Report Reports /Suggestions

Nominating Committee
Compensation Committee

ReportElection /Supervision

Executive Management
Committee

President andRepresentative Director

Internal Audit Office

Chairperson: President
Observers: Auditors

Assistance with decision-making

Audit

Audit

Compliance Committee

CSR Committee

Functional divisions, business units, corporate divisions, and Group companies

Corporate Governance Structure (After Shifting to a Three Committees Board Structure)
Election andDismissal of Director,
Decision of a bill

General Meeting of Shareholders

Election /Dismissal

Election / Dismissal

Board of Directors 5 directors and 10 outside directors Chairperson: Independent Outside Director
Election / Dismissal

Election / Dismissal

Nominating Committee
Advisory

ReportCompensation Decision

Election / Dismissal

Compensation Committee

Audit

Audit Committee

Compliance Committee

Supervision

Compensation
Decision

Report

Audit

ReportOrder

Representative Executive Officer
Executive Officer

ReportCooperation

Execution function
ReportCooperation

Supervisory function

Accounting
Auditor

Audit

Order

Internal Audit
ReportGroup Executive Committee

Audit

Functional divisions, Business units, Corporate divisions, and Group companies

Olympus Integrated Report 2019

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Olympus’ Corporate Governance
Basic Stance toward Corporate Governance

Overview of Each Board and Committee
Name

All our activities are based on our corporate philosophy, “Making
people’s lives healthier, safer and more fulfilling.” In accordancewith this philosophy, we will work for our shareholders andother stakeholders in order to realize ongoing corporate growthand medium-to-long-term improvements in corporate value.
This philosophy also drives us to establish, implement, andcontinuously improve systems for ensuring the effectivenessand efficiency of operations and the appropriateness andreliability of financial reports.
The Company is continuously strengthening its corporate
governance system, positioning this task as a top management
priority. In addition, we endorse the goals of Japan’s Corporate

Governance Code, which was formulated in March 2015
(revised in June 2018), and, in principle, we are complying
with and have implemented measures based on the principlesof the code. Through such efforts, we seek to ensure
effective corporate governance based on our fiduciary duty toshareholders; our responsibilities to customers, employees,
communities, and other stakeholders; and the aforementioned
corporate philosophy.

Corporate Governance Policy:
https://www.olympus-global.com/company/governance/policy.html

Corporate Governance Structure
Basic Corporate Governance Policies
In order to enhance the oversight functions of the Board of
Directors, which is membered by a majority of independent
outside directors, the Company fills the position of chairman of
the Board of Directors with an independent outside director inorder to establish a clear divide between business execution
and oversight functions. In addition, the Nominating Committee,
Compensation Committee, and Audit Committee consist of amajority of independent outside directors and are also chairedby such directors.
With regard to the composition of the Board of Directors, theCompany considers the diversity of experience, knowledge,
and skills of the Board of Directors, regardless of nationalities,
ethnicities, and genders of its members. We also securesufficient time for meetings of the Board of Directors to ensurethat all directors are able to fulfill their duties and responsibilities.
Overview of the Corporate Governance Structure
The Board of Directors consists of 15 members, nine ofwhom are independent outside directors. Term of directors
continue for one year. The Board of Directors convenes atleast once every three months and when needed to determine
basic management policies, matters relating to the internal
control system, and other important matters, and monitors
the execution of the duties of directors and executive officers,etc. The Board of Directors is chaired by Sumitaka Fujita, an
independent outside director.
In the exercise of supervisory functions at the Board of
Directors, the 10 outside directors are expected to bring their
specialist knowledge to bear on management. The Company
proactively provides directors with information to enable theeffective execution of their roles and duties. Outside directorsof the Company may at all times when needed or when
considered appropriate require clarifications and reports or
the submission of internal documents from internal directors,
executive officers, and employees, so as to strengthen thefunctions of information transmission and supervision and to58

create systems to ensure the soundness of management.
The three committees comprised of the Nominating,Compensation, and Audit Committees, each consisting in the
majority of independent outside directors, determine director
candidates (Nomination Committee) and the remunerations of
directors and executive officers (Compensation Committee),and audit the execution of the duties of directors and executive
officers (Audit Committee). In addition, the Company has
voluntarily established the Compliance Committee chaired byan independent outside director as a body to supervise andimprove the compliance system of the Olympus Group.
The articles of incorporation stipulate that directors of theCompany are appointed by a majority vote of the General
Meeting of Shareholders with at least one-third of shareholders
eligible to exercise voting rights in attendance and that
resolutions on appointments are not adopted by cumulative
voting.
Overview of the Corporate Governance Structure(As of June 25, 2019)

Chairperson

OutlineBoard ofDirectors

Independent
outside director

The Board of Directors determines basic management policy, matters related to the internal control system, and other important matters, andsupervises directors and executive officers, in the execution of their duties (at least once every three months and when needed).

Nominating
Committee

Independent
outside director

The Nominating Committee shall deliberate matters related to human resources at the director and executive officer level, and shall determine thecontent of proposals submitted to the General Meeting of Shareholders in relation to the appointment and dismissal of directors.
The nominating committee consists of three or more committee members selected from among the directors by the Board of Directors, andindependent outside directors constitute the absolute majority thereof. An independent outside director serves as the chairman.

Compensation
Committee

Independent
outside director

The Compensation Committee shall deliberate matters related to compensation of directors and executive officers, and prescribe policy in relation todetermining the details of compensation, etc., and in accordance with the policy, determine the contents of compensation, etc., for individuals.
The Compensation Committee consists of three or more committee members selected from among the directors by the Board of Directors, andindependent outside directors constitute the absolute majority thereof. An independent outside director serves as the chairman.

Audit
Committee

Independent
outside director

The Audit Committee shall carry out the following duties.
1) Auditing the execution of duties by executive officers and directors, and creating audit reports
2) Determining the content of proposals relating to the appointment, dismissal, and non-reappointment of accounting auditors
3) Other duties prescribed by law or by the Articles of Incorporation, and other matters recognized as necessary by the Audit Committee
The Audit Committee shall consist of at least three individuals selected from among the directors by the Board of Directors, of whom more than halfshall be independent outside directors. The chairman of the committee shall be an independent outside director. Moreover, at least one member shallbe an individual who possesses extensive knowledge related to financial and accounting.

Group
Executive
Committee

Representative
Executive Officer

In the Group Executive Committee, the Representative Executive Officer and executive officers deliberate on critical matters concerning businessexecution for the entire Olympus Group as entrusted by the Board of Directors, and provide support on the decision making of executive officers so as
to prevent decisions being made based solely on the discretion of an executive officer.
Each executive officer reports on and shares the status of execution of business and functions under their jurisdiction to ensure the effectiveness of thecommittee as a body for monitoring the execution of business and functions of the entire Olympus Group. (at least once a month and when needed)

Compliance
Committee

Independent
outside director

The Compliance Committee examines important matters related to Group compliance and internal control systems as well as compliance-related mattersfor which the Board of Directors requests advice. The findings are reported to the Board of Directors.

Structure of Board of Directors
Position

Name

Directors (5)Yasuo Takeuchi, Hiroyuki Sasa, Stefan Kaufmann, Nobuyuki Koga, Masashi Shimizu

Outside Directors (10)Sumitaka Fujita (Chairman), Takayuki Katayama, Susumu Kaminaga, Michijiro Kikawa, Tetsuo Iwamura, Yasumasa Masuda,
Katsuya Natori, Atsushi Iwasaki, D. Robert Hale, Jim C. BeasleyComposition of Committees
Name
Yasuo Takeuchi

Position

Nominating Committee (5)Director, Representative Executive Officer,
President and CEO○

Hiroyuki Sasa

Director

Stefan Kaufmann

Director, Executive Officer andChief Administrative Officer

Nobuyuki Koga

Director

Masashi Shimizu

Director

Sumitaka Fujita

Independent Outside Director

Compensation Committee (4)Audit Committee (5)○○○(Chairperson)

Takayuki Katayama

Independent Outside Director○(Chairperson)

Directors

15

Susumu Kaminaga

Independent Outside Director○

Of whom, outside directors

10Michijiro Kikawa

Independent Outside Director

Of whom, appointed as independent outside directors

9

Tetsuo Iwamura

Independent Outside Director○

Yasumasa Masuda

Independent Outside Director○

Katsuya Natori

Independent Outside Director○(Chairperson)

Atsushi Iwasaki

Independent Outside Director○

Term of directors
Executive officers

1 year5

Adoption of corporate officer system

Yes

Performance-linked remuneration

Yes

D. Robert Hale

Outside Director

Jim C. Beasley

Independent Outside Director

○
○

○
○

Composition of the Compliance Committee
Position

Name

Independent Outside Director

Susumu Kaminaga, Tetsuo Iwamura

Outside Committee member, lawyer

Yoichiro Hamabe

Chief Compliance Officer

Caroline WestGroup Compliance, Global

Hidenao Tsuchiya

Olympus Integrated Report 2019

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Olympus’ Corporate GovernanceOutside Directors

Development and Selection of Successors for the President

The Company has strengthened the corporate governancestructure by appointing 10 outside directors, representing
more than half of its 15 directors, and utilizing their objective

standpoint, wealth of experience, and extensive knowledge ofmanagement. 9 of the 10 outside directors are independent
officers.

Reason for appointment

Attendance at meetings of the Board of
Directors (Met 28 times in FY2019)

Sumitaka Fujita*

Mr. Fujita was appointed so that his extensive experience and diverse knowledge as a business manager at
ITOCHU Corporation may be applied to the Company’s management.

28/28

Takayuki Katayama*1

Mr. Katayama was appointed so that his extensive experience and diverse knowledge as a business manager
at Teijin Limited may be applied to the Company’s management.

27/28

Susumu Kaminaga*1

Mr. Kaminaga was appointed so that his extensive experience and diverse knowledge as a business manager
at Sumitomo Precision Products Co., Ltd. may be applied to the Company’s management.

28/28

Michijiro Kikawa*1

Mr. Kikawa was appointed so that his extensive experience and diverse knowledge as a business manager at
Hitachi Construction Machinery Co., Ltd. may be applied to the Company’s management.

26/28

Tetsuo Iwamura*1

Mr. Iwamura was appointed so that his extensive experience and diverse knowledge as a business manager at
Honda Motor Co., Ltd. may be applied to the Company’s management.

28/28

Yasumasa Masuda*1

Mr. Masuda was appointed so that his extensive experience and diverse knowledge as a business manager at
Astellas Pharma Inc. may be applied to the Company’s management.

21/21*2

Katsuya Natori*1

Mr. Natori was appointed so that his extensive experience and diverse knowledge as a business manager at
Sun Microsystems, Inc., Fast Retailing Co., Ltd., and IBM Japan, Ltd., as well as his diverse knowledge as an
attorney may be applied to the Company’s management.

27/28

Atsushi Iwasaki*1

Mr. Iwasaki was appointed so that his extensive experience and diverse knowledge as a certified public
accountant may be applied to the Company’s management.

25/28

D. Robert HaleMr. Hale was appointed to reflect in the management of the Company the rich experience as partner at
ValueAct Capital Management L.P., a shareholder of the Company, as experienced management consultant in
multiple industries, as investor in global capital markets, as well as knowledge in the healthcare industry, andexperience in supporting the trans-formation of global companies.

Position as of June 2019

Jim C. Beasley*1

Mr. Beasley was appointed to reflect on the management of the Company the rich experience and broad
knowledge management board member at C.R. Bard Group.

Position as of June 2019

Outside directors
1*1 Reported as an independent officer based on the rules and regulations of the Tokyo Stock Exchange*2 Number of Board of Directors’ meetings held since appointment at the General Meeting of Shareholders for the 150th term on June 26, 2018

The Nominating Committee establishes a succession plan for
the President and reviews it periodically. As for determining the
successor, the Nominating Committee discusses whether the
candidates, including outside candidates, have qualifications

Independence Criteria
The Company has established its “Criteria for Independence ofOutside Officers” as described below in order to clarify its policyon the independence of Outside Officers.
(Criteria for Independence of Outside Officers)
1. In any of the past 10 fiscal years, the Outside Officer has
not directly received more than ¥10 million in remuneration(excluding remuneration from the Company to Officers)or other assets from the Company and the Company’s
affiliates (hereinafter, collectively the “Group”). If the Outside
Officer is a consultant, accounting expert or legal expert, theorganization to which he or she belongs has not received
more than ¥10 million in remuneration or similar from theGroup.
2. D uring the past ten-year period, the Outside Officer has notbeen an Operating Director, Executive Officer, Corporate
Officer or employee of the rank of General Manager or aboveat a company that falls under the following categories.
(i)	In any of the past 10 fiscal years, the monetary amount of
the relevant company’s transactions with the Group has
been more than 2% of the consolidated revenue of either
the company or the Group

Support Systems for Directors
The Company arranges for, and covers the cost of, external
training sessions for directors to acquire basic knowledge
necessary for the performance of directors’ duties with aview to deepening directors’ understanding of their roles andresponsibilities.
To support the effective execution of the roles and duties ofoutside directors, the Company works proactively to provide
outside directors with information and distributes documents
and gives explanations prior to Board of Directors’ meetings.
In addition, the Company provides training for newly
inaugurated outside directors, comprising visits to the60(ii)	The relevant company is a principal shareholder of theCompany (holding more than 5% of the total number ofvoting rights of the Company directly or indirectly; thesame shall apply hereinafter)(iii)	The Group is a principal shareholder of the relevant
company(iv)	The relevant company has substantive interests in theGroup (as a main bank, consultant, etc.)(v)	The Group and the relevant company have a relationshipin which they mutually dispatch and appoint directors
3. T he Outside Officer is not financially dependent on a person
who falls under the categories of 1. or 2. above.
4. T he Outside Officer is not a spouse of, or a relative within
the third degree of kinship of, a Director, Operating Director,
Corporate Officer or employee of the rank of General
Manager or above at the Group.
5. T he Outside Officer does not belong to an auditing firm that
conducts statutory audits of the Group.
6. In addition to each of the above items, the Outside Officer
does not have any significant interest that casts doubt on
his or her independence.
Corporate Governance Report:
https://www.olympus-global.com/company/governance/policy.html

Company’s major business bases such as business offices andfactories, etc., briefing sessions, and business study sessions
to promote the acquisition of knowledge concerning theCompany.
Outside directors of the Company may at all times whenneeded or when considered appropriate require clarifications
and reports or the submission of internal documents frominternal directors, executive officers, and employees, so as
to strengthen the functions of information transmission andsupervision and to create systems to ensure the soundness ofmanagement.

Process for Appointment of Directors
The Nominating Committee shall deliberate director candidates
while making reference to the selection criteria, hold interviews,
and determine the content of proposals submitted to thethat are suitable for the President, and provides opinions andadvice to the Board of Directors. Thereafter, the successor isdecided by the Board of Directors.

General Meeting of Shareholders in relation to the appointment
and dismissal of directors.

Policies for Holding Stocks for Purposes Other Than Pure Investment andExercise of Related Voting Rights
The Company holds shares of listed stock for purposes otherthan pure investment in cases in which such holdings havebeen deemed viable for contributing to improved corporate
value over the medium to long term after verifying the mediumto-long term economic rationality of such holdings and theoutlook for the future. Each fiscal year, the Board of Directors
verifies the appropriateness of individual holdings through acomprehensive evaluation of factors, including the purpose ofa given holding and the benefits and risks associated with said
holding. Those holdings that are deemed unsuitable will bedownsized.
The Company exercises its rights as a shareholder in relation
to stocks held for purposes other than pure investment byvoting on all applicable proposals. In this voting, the Company

decides whether to vote in favor of or against each proposal
based on the circumstances surrounding the management of
the company in question as evaluated from the perspectiveof improving the corporate value of this company over the
medium to long term.

Stocks Held for Purposes Other Than Pure Investment
FY2016FY2017FY2018FY2019Number of holdings

64

57

48

37

Amounts of holdings(billions of yen)

68.0

27.9

26.9

18.9

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Olympus’ Corporate GovernanceInitiatives for Realizing Effective Corporate Governance

Executive Compensation in Fiscal 2019

The Company has been continuously strengthening its corporate governance system and enhancing its effectiveness, positioning
these tasks as top management priorities.

Evaluation Results Regarding the Effectiveness of theBoard of Directors
To increase the effectiveness of the Board of Directors andimprove corporate value, the Company institutes annual
analyses and evaluations of the overall effectiveness of theBoard of Directors. Third-party perspectives are employedas part of this process. The results of these analyses andevaluations are disclosed. These evaluations have been held
every year since 2015, and this time, the evaluation was thefifth such evaluation.
Evaluation Results for Effectiveness of the Board of Directors:
https://www.olympus-global.com/company/governance/board.html

Method of Evaluation
In cooperation with an external consulting firm, the Company
prepared a questionnaire on the effectiveness of its Board of
Directors and individual committees (Nominating Committee,
Compensation Committee, and Compliance Committee)
and their relationships with investors and shareholders. This
questionnaire was distributed to each director (11) and Audit &Supervisory Board member (4) (Fiscal 2019), and the Company
received answers from all of the respondents. With these replies
from directors and Audit & Supervisory Board members as well
as feedback from the external consulting firm, the Company
did an analysis and evaluation regarding the effectiveness of its
Board of Directors.

Evaluation Items, Issues, and Status of Improvement
Opinions are divided over the major direction, important matters of the Company, and appropriate decision making between the two: (1)Discussion was thoroughly made and (2) There is room where discussions can be further deepened, depending on agenda items

2. O peration of the Board of Directors in the
Past One Year

Regarding the operation of the Board of Directors, the frequency of the meetings is appropriate and sufficient time discussion is secured.
Discussions are open and active and are made from a perspective based on the global management framework.
Meanwhile, although there has been an improvement in careful selection of agenda items and contents of proposal materials, issues
should be more organized and clarified in materials, which is mentioned as an issue to be addressed.

3. Important Committees

Although each committee, Nominating Committee, Compensation Committee and Compliance Committee, appropriately fulfills expectedroles, there were some cases where further provision of information was needed for discussion at the Committees.

4. Size / Composition of the Board of Directors

Support for outside directors is sufficiently provided.

5. Roles of Audit & Supervisory Board
members

Support for Audit & Supervisory Board members is sufficiently provided, and the presence of Audit & Supervisory Board members
contributes to enhancing the effectiveness of the Board of Directors.

6. R elationship with investors andshareholders

The Board of Directors is appropriately provided information on the capital market.
Although the Company’s long-term competitive advantages are communicated to the capital market, further enhancement is desired.

and risk management including environmental and social issues
should be further deepened considering priority.
The Company made a transition to a Company with athree committees board structure on June 25, 2019. We
are determined to further proceed with the separation of
execution and supervision, accelerate decision making on
business execution, further reinforce governance, and enhancetransparency. Moreover, the Board of Directors of the Company
will further heighten the effectiveness of the Board of Directors
by planning and implementing response measures as to eachof the aforementioned issues.

Executive Compensation
Our basic policy for executive compensation is to provide
compensation that is appropriate based on the duties ofofficers and that instills in them a strong commitment tomaximizing corporate value so that the Company may live

62

Bonuses

Stock options

Retirement
benefit

Number of
directors / Audit &Supervisory Board
members

Total compensation by type (¥ million)
Base

Directors (excluding outside directors)

377

262

95

20

―

5

Audit & Supervisory Board members(excluding outside audit & supervisory board
members)

56

56

―

―

―

2

Outside officers

110

110

―

―

―

9

* The above-stated outside officers include one outside officer who retired at the time of the 150th Annual General Meeting of Shareholders held on June 26, 2018.

Remuneration Composition
The composition of remunerations of directors and executive
officers is prescribed for each of the following categories. The
combined maximum remuneration limit for restricted sharecompensation and performance linked stock remunerations is
per year 500 million yen and 600,000 shares.

Category 1

Category 2

Category 3

Yasuo Takeuchi, Akihiro Taguchi, Haruo Ogawa, Yasushi Sakai

Stefan Kaufmann

Non-executive internal directors and outside directors■ Composition of Category 1 Remuneration

1. Fulfilling Functions of the Board of Directors

Future Initiatives Based on the Evaluation Result of theEffectiveness of the Board of Directors
Based on the evaluation of the Board of Directors for theperiod ended March, 2019, the Board of Directors discussed
future initiatives. As a result, the Board concluded thatissues to be addressed are to further advance separation of
execution and supervision, to create a framework where theBoard members can concentrate on important management
issues and strategic discussion, and to aim for a higher level
execution and supervisory system. The Board also confirmedthat discussions of the Company’s initiatives for sustainability

Position

Total value of
remuneration(¥ million)

up to shareholder expectations. Based on said policy, theCompensation Committee focuses on appropriately setting thecompensation portion linked to short and mid- and long-term
performance, and decides officers’ compensation.

responsibility). Additionally, the restricted share compensation,
The category 1 executive remuneration consists of a monthly
contingent on the position holder’s continuing in the position
remuneration, bonus payments as a short-term incentive
as executive officer of the Company for a certain period, andsystem, and restricted share compensation and performancethe performance-linked stock remuneration, contingent on thelinked stock remuneration as long-term incentive systems.
attainment of predetermined targets, is intended as an incentive
The monthly remuneration distinguishes between directors’
to promote sustained enterprise value enhancement and tobase remuneration (paid only to directors) and executive
promote value sharing with shareholders, as an arrangement
officers’ base remuneration. The latter is determined based on
to award the Company’s common shares in addition to eligible
graded remuneration amounts which are set in accordance
executives’ monthly remuneration and bonus.
with the role and responsibility of the subject position. Bonus
total payment amounts are determined
Compensation by Typeby combining the consolidated
Type of compensation
Standard ratio
performance category (calculated based
Fixed
compensation:
Monthlysalaries
Executive
officers’
base
remuneration*
50%
on consolidated business results) and
Short-term incentives
Bonuses25%
the personal assessment category
Variable compensation:
Restricted share compensation
6%50%(assessed and calculated based on theLong-term incentives
attainment of financial and non-financial
Performance-linked stock remuneration
19%
targets in the position holder’s area of*The table above does not include directors’ base remuneration.

■ Composition of Category 2 Remuneration

The category 2 executive remuneration consists of a monthly
remuneration, with bonus payments as a short-term incentive
system, and with performance-linked stock remuneration as
long-term incentive system and pension plan contributions.
Monthly remunerations are decided on an individual basis
in accordance with the role and responsibility of the subject
position. Bonus total payment amounts are determined by
combining the consolidated performance category (calculated
based on consolidated business results), the personalassessment category (assessed and calculated based on■ Composition of Category 3 Remuneration

The category 3 executive remuneration consists only ofthe monthly remuneration, without payment of bonus,

the attainment of financial and non-financial targets in theposition holder’s area of responsibility), and the fixed category.
Additionally, the performance-linked stock remuneration,
contingent on the attainment of predetermined targets, isintended as an incentive to promote sustained enterprise valueenhancement and to promote value sharing with shareholders,
as an arrangement to award the Company’s common sharesin addition to eligible executives’ monthly remuneration andbonus. Category 2 executives are not eligible to receive
restricted share compensation.

restricted share compensation, and performance-linked stock
remuneration.

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Olympus’ Corporate GovernanceInternal Controls

Basic Policy on Information Disclosure

All our activities are based on our corporate philosophy, “Making
people’s lives healthier, safer and more fulfilling.” The Company,
based on this basic concept, shall prepare and operate aframework which ensures the effectiveness and efficiency

of operations and appropriateness and reliability of financial
reporting of the Company and its subsidiaries (hereinafter, “theOlympus Group”), and make continuous improvements.

10 Items for Establishing a Framework as Basic Policy for Our Internal Control System
1. Framework to ensure the compliance by Executive
Officers and employees of the Company and Directors andemployees of the its subsidiaries, in performance of duties,
to applicable laws and regulations as well as the Articles ofIncorporation
2. Framework regarding the maintenance of records andmanagement of information in relation to performance of
duties by Executive Officers of the Company
3. Regulations and other framework relating to managing risksof loss of the Olympus Group
4. Framework to ensure the effective performance of duties
by Executive Officers of the Company and Directors of its
subsidiaries
5. Framework for reporting to the Company on mattersconcerning execution of duties by the Directors andemployees of the subsidiaries

7. Framework regarding reports by Directors (except those whoare members of the Audit Committee), Executive Officers
and employees of the Company to the Audit Committee ofthe company, and reports by Directors and employees of thesubsidiaries of the Company or personnel who have received
reports from them to the Audit Committee of the Company

In addition to conducting appropriate disclosure as mandatedby laws and regulations, the Company also strives to transmit
information in various forms on its own accord in order toensure the transparency and impartiality of decision making
and realize effective governance. These forms include Olympus’
corporate website, integrated reports, and shareholder
newsletters as well as voluntarily released timely disclosure
documents. In issuing these communications, directors takecare to ensure that all information disclosed is not only easy
to understand but also valuable to the target recipients.
Furthermore, as a large portion of the Company’s shareholders
are not Japanese, we provide English-language versions for the
majority of these information disclosures.

8. Framework to ensure that any personnel who have made areport to the Audit Committee of the Company will not be
subjected to any unfair treatment due to the report made9. Matters regarding procedures for advance payment ofexpenses incurred in connection with execution of duties by
the Audit Committee members of the Company and theirreimbursement, and treatment of other expenses or liabilities
incurred in connection with execution of the duties
10. Other systems to ensure the effectiveness of audits by the
Audit Committee of the Company

6. Framework for matters related to employees whose
assignment is to assist in the duties of Audit Committeeof the Company, and matters related to the independenceof those employees from the Executive Officers of theCompany, and matters related to ensuring the effectivenessof instructions from Audit Committee of the Company tothose employees

Basic Policy on the Internal Control System
https://www.olympus-global.com/company/governance/control.html?page=ir

Global Framework of Internal Rules
The Company has established a platform for managing internal rules in order to ensure the ongoing improvement of management
quality from the perspective of global governance and management.

Investor Relations (IR) Activities
The following investor relations activities were conducted in fiscal 2019.
Activity

Times
conducted

Conferences on results for institutional investors
and analysts

4

Meetings or teleconferences held quarterly to explain topics from the period, focused on
financial performance and forecasts

Investor Day / IR event

2

Events featuring explanations of the Company‘s business strategies, growth strategies, andproduct exhibitions

New product and technology briefings

1

Briefings concerning the Company’s new products and technology

Conference calls for overseas institutional
investors

4

Teleconferences with overseas institutional investors held on the day of financial resultspresentations for each quarter

Overseas IR roadshows

7

Meetings for institutional investors in which the president and the CFO visit overseas sites

Conferences held by securities companies(including overseas conferences)5

Participation in and meetings at conferences held by securities companies in Japan andoverseas

Meetings for individual investors

7

Meetings held at branch offices of securities companies and events for individual investors

Approx. 450

Individual meetings held with the president, the CFO, and/or investor relations division
representatives (including meetings conducted at overseas IR roadshows and conferences)

Individual meetings with institutional investors
and analysts

Basic Management Policies

Communication with Stakeholders
Seeking to facilitate sustainable growth and medium-to longterm improvements in corporate value, the president and thechief financial officer (CFO) play a central role in our proactive
efforts to communicate with shareholders. Investor relations
divisions support these efforts and create systems for sharing
information within the Company and relaying input fromshareholders to management.
Furthermore, to protect the rights of shareholders,convocation notices for the general meeting of shareholders
are sent at the earliest date possible and are made to include
a comprehensive range of information. In addition, Englishlanguage versions of convocation notices are uploaded onto
the Company’s corporate website, and we take other steps
to guarantee that such information is provided fairly to allshareholders, including those overseas, and thereby ensurethat shareholders have ample information and sufficient time toproperly exercise their voting rights.

Details

Corporate Philosophy
OUR PURPOSEOUR CORE VALUES
Our Behaviors
Olympus Global Code of Conduct
Basic Policy for Corporate GovernanceBusiness Strategies

Basic Policy on the Internal Control System

Olympus Group Corporate Governance Rules (GCGR)
Olympus Global Rules (OGR)
Olympus Global Business Rules (OGBR)

Regional Rules

Local / Individual Rules

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