Honda Motor : Report of Independent Directors

Honda Motor Co., Ltd._Report of Independent Directors

REPORT OF INDEPENDENT DIRECTORS

1. Basic Information

Company Name

Honda Motor Co., Ltd.

Securities

7267

Code Number

Submission Date

2021/6/1

Date of Change of

2021/6/23

Position (scheduled date)

Reason for Submission of

To discuss the relevant agenda of electing outside directors at an Ordinary General

Report of Independent

Meeting of Shareholders.

Directors/Corporate Auditors

The Company has selected all persons who are qualified to become independent

2. Matters related to Independence of Independent Directors/Corporate Auditors and Outside Directors/Outside Corporate Auditors

Outside Director/

Independent

Attributes of Independent Directors/Corporate Auditors and Outside Directors/Outside Corporate Auditors (*2,

Details of

Consent of

No.

Name

Outside Corporate

Director/

*3)

Change of

the Said

Auditor

Corporate

a

b

c

d

e

f

g

h

i

j

k

l

Not

Position

Person

Auditor

Applicable

1

Kunihiko Sakai

Outside

Yes

Yes

correction

Yes

Director

/change

2

Fumiya Kokubu

Outside

Yes

Yes

correction

Yes

Director

currently

/change

3

Yoichiro Ogawa

Outside

Yes

Yes

new

Yes

Director

formerly

appointment

4

Kazuhiro Higashi

Outside

Yes

Yes

Yes

new

Yes

Director

currently

currently

appointment

5

Ryoko Nagata

Outside

Yes

Yes

new

Yes

Director

appointment

3. Explanation of the Attributes of the Independent Directors/Corporate Auditors and the Reasons for the Appointment

No.

Explanation of the Applicability of Attributes (*4)

Reasons for the Appointment of the Independent Director/Auditor (*5)

Mr. Kunihiko Sakai has a high expertise and abundant experience as a legal affairs specialist. The

Company expects him to oversee the entire business management of the Company from an objective,

highly sophisticated and broader viewpoint.

1

In addition, he is specified as an independent director, because there are not any personal relationship,

business relationship etc. which applies to the matters described in the Criteria for Independence of

Outside Directors, and there are no special conflicts of interest between the Company and Mr. Kunihiko

Sakai.

Mr. Fumiya Kokubu has abundant experience and deep insight regarding corporate management. The

Company expects him to oversee the entire business management of the Company from an objective,

highly sophisticated and broader viewpoint.

Marubeni Corporation, where Mr. Fumiya Kokubu currently holds the position of

In addition, he is specified as an independent director, because there are not any personal relationship,

Chairman of the Board, the Company and their principal consolidated subsidiaries have

business relationship etc. which applies to the matters described in the Criteria for Independence of

2

business relationships. However, the amount of annual transactions between them is less

Outside Directors, and there are no special conflicts of interest between the Company and Mr. Fumiya

than 1% of the consolidated sales revenue of the Company and the other party, which

Kokubu.

fulfills the Criteria for Independence of Outside Directors.

Marubeni Corporation, where Mr. Fumiya Kokubu currently holds the position of Chairman of the Board,

the Company and their principal consolidated subsidiaries have business relationships. However, the

amount of annual transactions between them is less than 1% of the consolidated sales revenue of the

Company and the other party, which fulfills the Criteria for Independence of Outside Directors.

Mr. Yoichiro Ogawa has high expertise and abundant experience as an accounting specialist.

The Company expects him to oversee the entire business management of the Company from an objective,

highly sophisticated and broader viewpoint.

Deloitte Group, where Mr. Yoichiro Ogawa formerly belonged to, the Company and the

In addition, he is specified as an independent director, because there are not any personal relationship,

Company's principal consolidated subsidiaries have business relationships. However, the

business relationship etc. which applies to the matters described in the Criteria for Independence of

3

amount of annual transactions between them is less than 1% of the consolidated sales

Outside Directors, and there are no special conflicts of interest between the Company and Yoichiro

revenue of the Company and the other party, which fulfills the Criteria for Independence of

Ogawa.

Outside Directors.

Deloitte Group, where Mr. Yoichiro Ogawa formerly belonged to, the Company and the Company's

principal consolidated subsidiaries have business relationships. However, the amount of annual

transactions between them is less than 1% of the consolidated sales revenue of the Company and the other

party, which fulfills the Criteria for Independence of Outside Directors.

The aggregate amount of the Company Group's borrowings from Resona Holdings, Inc.

Mr. Kazuhiro Higashi has abundant experience and deep insight regarding corporate management. The

and its subsidiaries, where Mr. Kazuhiro Higashi currently holds the position of Chairman

Company expects him to oversee the entire business management of the Company from an objective,

and Director, in the past three fiscal years is less than 1% of the amount of consolidated

highly sophisticated and broader viewpoint.

total assets of either of the two companies, which fulfills the Criteria for Independence of

In addition, he is specified as an independent director, because there are not any personal relationship,

Outside Directors.

business relationship etc. which applies to the matters described in the Criteria for Independence of

4

Mr. Fumihiko Ike, who was Chairman and Representative Director of the Company, has

Outside Directors, and there are no special conflicts of interest between the Company and Mr. Kazuhiro

been nominated as a candidate of outside director of Resona Holdings, Inc. and will be its

Higashi.

outside director from June 2021 subject to the resolution at its annual shareholders

The aggregate amount of the Company Group's borrowings from Resona Holdings, Inc. and its

meeting. However, Mr. Fumihiko Ike retired as Chairman and Representative Director of

subsidiaries, where Mr. Kazuhiro Higashi currently holds the position of Chairman and Director, in the

the Company in June 2016 and has not been involved in management or business

past three fiscal years is less than 1% of the amount of consolidated total assets of either of the two

execution of the Company since then.

companies, which fulfills the Criteria for Independence of Outside Directors.

Ms. Ryoko Nagata has abundant experience and deep insight regarding corporate management and audit.

The Company expects her to oversee the entire business management of the Company from an objective,

highly sophisticated and broader viewpoint.

5

In addition, she is specified as an independent director, because there are not any personal relationship,

business relationship etc. which applies to the matters described in the Criteria for Independence of

Outside Directors, and there are no special conflicts of interest between the Company and Ms. Ryoko

Nagata.

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Honda Motor Co., Ltd._Report of Independent Directors

4. Supplemental Explanation

The Company has established its "Criteria for Independence of Outside Directors" as follows.

The Company's board of directors will determine that an outside director is sufficiently independent from the Company if it determines that the said outside director satisfies the independence criteria stipulated by the Tokyo Stock Exchange and the requirements set forth below:

1. He/She is not, and has never been, any of the following during the last year:

1. a person who executes the business (*1) of a large shareholder (*2) of the Company;
2. a person who executes the business of (i) a major customer (*3) of the Company, or (ii) a company of which the Company is a major customer;
3. a person who executes the business of a major lender (*4) of the Company Group;
4. a person who executes the business of an audit corporation which conducts statutory audits for the Company or a person who handles the audit functions of the Company;
5. a consultant, an accounting specialist, or a legal expert (or, if the person in question is a corporation, an association, or any other similar organization, then a person who executes the business of that corporation, etc.) who receives a large amount (*5) of money, etc. from the Company, other than remuneration paid to directors of the Company;

1. No family member or close relative (*6) of the outside director currently falls or at any point of time during the last year fell under any of items 1) through 5) in paragraph 1 above.

Established on May 15, 2015

Partly amended on June 15, 2017

Partly amended on February 9, 2021

Notes

*1	A "person who executes the business" means an executive director, an executive officer, or an important employee including operating officer.
*2	A "large shareholder" means a shareholder who directly or indirectly holds shares representing 10% or more of the total number of voting rights of the Company as of the end of a fiscal year.
*3	A "major customer" means a customer of the Company where the annual amount of transactions between the customer and the Company exceeds 2% of the consolidated sales revenue of the
Company or the said customer.
*4	A "major lender" means a financial institution from which the Company Group borrows, where the aggregate amount of such borrowings exceeds 2% of the amount of consolidated total assets of the
Company or the financial institution as at the end of a fiscal year.
*5	A person receives a "large amount" if he/she receives consideration from the Company in excess of 10 million yen per year.
*6	A "family member or close relative" means a spouse or first or second degree relative of an outside director.
▸1	If, among the outside directors/outside corporate auditors, all of them who satisfy the qualifications which are required to become an independent director/corporate auditor are notified as independent
▸2	Matters to check regarding Attributes of the Independent Directors/Corporate Auditors and Outside Directors/Outside Corporate Auditors:
	a. person who executes business of the listed company or its subsidiary;
	b. directors who are not executive personnel or accounting advisors of the listed company or its subsidiary (where outside corporate auditors are appointed as independent corporate auditors);
	c. directors who are executive personnel or non-executive personnel of a parent company of the listed company;
	d. corporate auditors of a parent company of the listed company (where outside corporate auditors are appointed as independent corporate auditors);
	e. person who executes business of a fellow subsidiary of the listed company;
	f. party for which the listed company is a major customer or a person who executes its business;
	g. listed company's major customer or a person who executes its business;
	h. consultant, accounting professional, or legal professional who receives a large amount of money or other financial asset other than remuneration for directorship/corporate auditorship from the
	i. listed company's major shareholder (where the said major shareholder is a company, a person who executes its business);
	j. person who executes the business of a customer of the listed company (where any of items f, g, and h do not apply to such customer) (this item only applies to the independent directors/corporate
	auditors himself/herself)
	k. person who executes the business of an entity whose outside director/outside corporate auditor is also a person who executes the business of the listed company (this item only applies to the
	independent directors/corporate auditors himself/herself)
	l. person who executes the business of an entity to whom the listed company makes donations (this item only applies to the independent directors/corporate auditors himself/herself)
	Please note that expressions used in each of items a to l above are abbreviations of words used in items which are stipulated in the rules of the stock exchange.
▸3	If any of the items above apply to the independent directors/corporate auditors himself/herself "now or recently," please mark with a "○" and, if any of the items above applied to the independent
	directors/corporate auditors himself/herself in the "past," please mark with a "△."
	If any of the items above apply to a family member or a close relative "now or recently," please mark with a "●" and, if any of the items above applied to any of them in the "past," please mark with a "
▸4	If any of the items a to l above apply, please provide an explanation (summary).
▸5	Please write down the reasons for appointing the independent director/corporate auditor.