LIXIL : Mar 23, 2020ReleaseNotification Regarding Determination of Director Candidates, Election of Executive Officers, Change of Representative Executive Officer, and Partial > NEW

[This is an English translation of the original text written in Japanese]

March 23, 2020

LIXIL Group Corporation Kinya Seto

Representative Executive Officer and President (First Section of TSE/NSE, code 5938)

(Contact): Kayo Hirano

Senior Manager, Investor Relations Office

Notification Regarding Determination of Director Candidates, Election of Executive Officers,

Change of Representative Executive Officer, and Partial Amendment of the Articles of

Incorporation (Change in Term of Office of Executive Officers)

LIXIL Group Corporation (hereinafter "LGC") hereby gives notice that its Nomination Committee has today determined candidates for the position of Director, as indicated below, to be proposed at the 78th Annual General Meeting of Shareholders, which is scheduled to be held in June 2020 (hereinafter "AGM").

In addition, LGC hereby announces that its Board of Directors has today determined the Executive Officers as of April 1, 2020, as indicated below, and that its Board of Directors plans to submit a request for the change in term of office of Executive Officers through a "partial amendment of the Articles of Incorporation" at the AGM.

• For more information on the considerations given to the determination of director candidates and details of the nomination process, please refer to the attached, "(Supplementary Material) Regarding Appointment of Director Candidates and Executive Officers for the Next Term."

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1. Regarding Director Candidates

List of candidates for the position of Director:

		(*outside directors, ◎newly appointed candidates)
*	Tamio Uchibori	Current Director and Member of Audit Committee of LIXIL Group
		Corporation, Part-time Statutory Auditor of LIXIL Corporation
*	Kaoru Onimaru	Current Director, Member of Nomination Committee, and Member of
		Governance Committee of LIXIL Group Corporation
*	Teruo Suzuki	Current Director, Chairperson of Governance Committee and Member of
		Nomination Committee of LIXIL Group Corporation, Part-time Statutory
		Auditor of LIXIL Corporation
*	Yuji Nishiura	Current Director, Chairperson of Nomination Committee, Member of
		Compensation Committee, and Member of Governance Committee of
		LIXIL Group Corporation
*	Daisuke	Current Director, Chairperson of Compensation Committee and Member
	Hamaguchi	of Nomination Committee of LIXIL Group Corporation
*	Masatoshi	Current Director, Chairperson of Board of Directors, Member of
	Matsuzaki	Nomination Committee, and Member of Governance Committee of
		LIXIL Group Corporation
	Kinya Seto	Current Director, Representative Executive Officer, President and Chief
		Executive Officer (CEO) of LIXIL Group Corporation
		Representative Director and Chairman of LIXIL Corporation
◎	Sachio Matsumoto	Current Representative Executive Officer and Executive Vice President,
		Finance, Treasury, M&A, and Legal, Chief Financial Officer (CFO) and
		Chief Legal Officer (CLO) of LIXIL Group Corporation
		Director, Executive Vice President, CFO, and CLO of LIXIL Corporation
◎	Hwa Jin Song	Current Executive Officer and Senior Managing Director, Human
	Montesano	Resources, Public Affairs, Investor Relations, External Affairs, and
		Corporate Responsibility, Chief Public Affairs Officer (CPAO), and Chief
		People Officer (CPO) of LIXIL Group Corporation
		Director, Senior Managing Director, CPAO of LIXIL Corporation

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2. Regarding Executive Officers

List of Executive Officers (as of April 1, 2020, whose term of office will last until the close of the first meeting of the Board of Directors that is convened after the AGM):

(*concurrently serves as a director, ◎newly appointed candidate)

*	Kinya Seto	Representative Executive	CEO
		Officer and President
	Sachio Matsumoto	Representative Executive	Finance, Treasury, M&A, and Legal,
		Officer and Executive Vice	CFO
		President
	Hwa Jin Song	Executive Officer and Senior	Human Resources, Public Affairs,
	Montesano	Managing Director	Investor Relations, External Affairs, and
			Corporate Responsibility, CPO
	Yugo Kanazawa	Executive Officer and Senior	Marketing, Digital, and IT, Chief Digital
		Managing Director	Officer (CDO)
	Bijoy Mohan	Executive Officer and Senior	LIXIL International
		Managing Director
*	Satoshi Yoshida	Executive Officer and Senior	LIXIL Housing Technology (LHT) Japan
		Managing Director
	Hiroyuki Oonishi	Executive Officer and Senior	LIXIL Water Technology (LWT) Japan
		Managing Director
◎	Shoko Kimijima	Executive Officer and Senior	Legal and Compliance, Chief Legal &
		Managing Director	Compliance Officer (CLCO)

3. Change of Representative Executive Officer

(1) Reason for the change:

Due to changes in Executive Officers (nomination process)

(2) Details of the change in Representative Executive Officer (effective April 1, 2020):

Name	New Positions	Current Positions
		Director, Representative Executive
		Officer and Executive Vice
		President, Sales and Management
	Director, and	of Domestic Subsidiaries of LIXIL
Kazuhiko Ootsubo	Group Corporation
Vice Chairman, LIXIL Corporation
	Representative Director, President
		and CEO, and LIXIL Japan
		Company CEO of LIXIL
		Corporation

As a result of this change, Mr. Kinya Seto and Mr. Sachio Matsumoto will both serve as Representative

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Executive Officers.

4. Partial Amendment of the Articles of Incorporation

(1) Reason for the amendment:

The term of office of Executive Officers will change in order to clarify their management responsibilities during the fiscal year.

(2) Details of the amendment of the Articles of Incorporation:

			(Underlined text denotes amendments)
	Current		After amendment
	Chapter 6 Executive Officers		Chapter 6 Executive Officers
(Term of Office of Executive Officers)	(Term of Office of Executive Officers)
(Article 35)	(Article 35)
The term of office of an Executive Officer shall	The term of office of an Executive Officer shall
expire at the close of the first meeting of the	expire on the last dayof the fiscal year ending
Board of Directors to be convened after the	within one (1) year from his/her election.
ordinary general meeting of shareholders
pertaining to the last fiscal yearending within
one (1) year from his/her election.
2.	(Text Omitted)	2.	(Unchanged)

(Note) The above amendment is subject to the approval at the AGM of Shareholders of LGC, which will be held in June 2020.

(3) Key dates:
Scheduled date of the AGM for the amendment of the Articles	June 19, 2020 (Plan)
of Incorporation
Scheduled date of the amendment of the Articles of	June 19, 2020 (Plan)
Incorporation (effective date)

End

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(SUPPLEMENTARY MATERIAL)

REGARDING APPOINTMENT OF DIRECTOR CANDIDATES AND EXECUTIVE OFFICERS FOR THE NEXT TERM

Copyright © LIXIL Group Corporation. All rights reserved.

CONTENTS

1. Results of the appointment of director candidates for the next term
2. Appointment process for director candidates for the next term
3. Results of the appointment of executive officers for the next term
4. Appointment process of executive officers for the next term
5. Revision of the Nomination Committee's system and operations

Appendix 1:Stance on Board diversity

Appendix 2:Reasoning regarding the reappointment of the CEO

Appendix 3:Approach on revision of Nomination Committee rules and guidelines

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1. RESULTS OF THE APPOINTMENT OF DIRECTOR CANDIDATES FOR THE NEXT TERM

	Current term	To retire	New	Candidates
			appointments	for the next
				term
Total	14 people	-7 people	+ 2 people	9 people
Internal directors	5 people	-4 people	+ 2 people	3 people

Outside directors

9 people

-3 people

0

6 people

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2. APPOINTMENT PROCESS FOR DIRECTOR CANDIDATES FOR THE NEXT TERM

1. Composition of the Board of Directors
2. Appointment of director candidates

• Summarized the results of the questionnaire survey of all directors (October 2019)
• Performed individual hearings on the content of questionnaire responses (November 2019)

Internal directors	Outside directors
 Organize viewpoints regarding	 Hold vote with all directors
appointments	(December 2019 - January 2020)
 Discuss between the Chairperson of	 Perform individual hearings on
the Board, the Chairperson of the	ballot content (January 2020)
Nomination Committee, and the CEO	 Perform hearings with persons
 Deliberate at the Nomination	other than directors
Committee based on the proposal by	 Report results and create proposal
the Chairperson of the Nomination
(February 2020)
Committee
	*Note: Outsourced to an external
	professional institution

• Based on the above, the Nomination Committee convened, deliberated and reached a decision in March 2020.

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3. RESULTS OF THE APPOINTMENT OF EXECUTIVE OFFICERS FOR THE NEXT TERM

Current term	To retire	New	Next term
(As of March 23, 2020)	appointment	(As of April 1, 2020)

Executive	9 people	-2 people	+ 1 person	8 people
officers

• Decided to align executive officersʻ term of office with the fiscal year.

[Reference]

Current term	To retire	New	Next term
(As of March 23, 2020)	appointment	(As of April 1, 2020)

Directors
concurrently
serving as	3 people	-2 people	+ 2 people	3 people
executive
officers

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4. APPOINTMENT PROCESS OF EXECUTIVE OFFICERS FOR THE NEXT TERM

STEP 1.

STEP 2.

STEP 3.

STEP 4.

STEP 5.

STEP 6.

August to October	Revised rules and guidelines for the appointment of
2019	executive officers
August to September	Performed individual interviews with current executive
2019	officers (to deepen understanding of executive officers)
December 2019	Agreed to accept the proposal for the structure of
	executive officers for the next term, under the
	assumption that Mr. Seto will be reappointed as CEO
January 2020	Received the CEO's proposal regarding the structure of
	the executive officers for the next term
February 2020	Performed interviews with retiring and new candidates
	(to confirm intention)
February 2020	Confirmed CEO reappointment policy and deliberated on
	the draft of the appointment of the executive officers for
	the next term

• Based on the above, the Board of Directors resolved the proposal from the Nomination Committee in March 2020.

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5. REVISION OF THE NOMINATION COMMITTEE'S SYSTEM AND OPERATIONS

1. Revise the Nomination Committee's Rules and Corporate Governance Guidelines =>Prevent arbitrary interpretations, abuse of systems, and out of control actions.
2. Enhance minutes of committee meetings

=>Ensure transparency of discussions.

1. Review policies, standards, and procedures related to "Composition of Board of Directors and appointment of director candidates" and collect the opinions of all directors =>Eliminate bias in opinions and decisions.
2. Formulate a CEO succession plan and clarify the election process

=>Improve persuasiveness

5. Promote interviews and dialogue with the shareholders, executive officers, employees, etc. =>Avoid being a "blackbox" and enable open and transparent understanding

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APPENDIX 1: STANCE ON BOARD DIVERSITY

1. The Nomination Committee focuses on two criteria regarding the diversity of the Board of Directors: "attributes" (gender, nationality, etc.) and "knowledge and experience"
2. The 10 items that comprise the criteria for "knowledge and experience" (skill matrix) is currently under review.
3. • Practical experience in corporate management.
   • Experience in overseas business and overseas M&A.
   • Knowledge concerning finance, etc.
4. While the number of directors has been reduced, the Nomination Committee has aimed to maintain and improve diversity. Taking this approach into account, the Nomination committee will update the skill matrix regularly.

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APPENDIX 2: REASONING REGARDING THE REAPPOINTMENT OF THE CEO

Every year, the Nomination Committee examines the pros and cons of reappointing the CEO based on three performance indicators: "business performance", "progress of measures", and "internal evaluation".

1. Since Mr. Seto's return as CEO, the company's business performance and share price have been favorable (except in the case of abnormalities).
2. Regarding the medium-term management plan, the company is boldly taking on difficult challenges and starting to achieve results.
3. • The plan on the merger of LIXIL Group Corporation and LIXIL Corporation and promotion of other organizational reforms.
   • Execution of the comprehensive HR program to revitalize the Japan business (new HR strategy), etc.
4. Mr. Seto has received an extremely positive evaluation from the executive officers.
5. • The internal atmosphere has improved. Decision making and execution has sped up.
   • A sense of global unity is rapidly advancing, etc.

In view of the above and other factors, the Nomination Committee agreed to the reappointment of Mr. Seto as CEO. In addition, the Committee received a proposal from the CEO regarding the executive officer system for the next term.

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APPENDIX 3. APPROACH ON REVISION OF NOMINATION COMMITTEE RULES AND GUIDELINES

Clarify the authority and process of the Nomination Committee and prevent arbitrary interpretation.

After revision		Before revision
Example 1:Concerning executive officer personnel, the		In principle, the Nomination
Board of Directors (must always) request the Nomination		Committee's opinion is
Committee's opinion.		submitted for discussion.
Example 2:If there is an executive officer candidate who is		All members will provide fair
a member of the Nomination Committee, the member		opinions.
concerned shall not participate in that discussion nor
decision.
Example 3:At the time of removal or dismissal of executive		The Committee will perform an
officers or the CEO, the Nomination Committee will		interview if the Board of
conduct an interview (without fail).		Directors requests it.

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