July 2023

Mitsui Sumitomo Insurance will respond to the Principles for Responsible Institutional Investors (Japan's Stewardship Code) according to the following policies.

  • 1.Institutional investors should have a clear policy on how they fulfill their stewardship responsibilities, and publicly disclose it.

The Principles for Responsible Institutional Investors (Japan's Stewardship Code) stipulate various principles thought to be useful for ensuring institutional investors fulfill their stewardship responsibilities as "responsible institutional investors" with an eye to both clients/beneficiaries and investee companies. Mitsui Sumitomo Insurance agrees with this intent and accepts the Code.
The Company holds shares for the purpose of ensuring stable investment income, increasing the long-term value of the assets, and maintaining and strengthening comprehensive business relationships — primarily insurance transactions with investee companies.
The Company is committed to fulfilling its stewardship responsibilities by working to improve the corporate value of investee companies while preventing damage and promoting sustainable growth in the medium to long term, by deepening its understanding of investee companies and their business environments, and by also conducting constructive "purposeful dialogue" with investee companies with a view to sustainability (medium- to long-term sustainability, including ESG factors).

  • 2.Institutional investors should have a clear policy on how they manage conflicts of interest in fulfilling their stewardship responsibilities and publicly disclose it.

The Company will manage transactions that may be conflicts of interest and appropriately conduct business to ensure the interests of clients are not unduly harmed.
The transactions subject to management, management methods, management structure, and other topics are stipulated in the Policy on Management of Conflicts of Interest.
Decisions on the exercise of voting in investee companies are made, consistently and independently, by our decision makers based on the Company’s basic policy on exercising voting rights (Principle 5).
Furthermore, the process and results of exercising voting rights are periodically reported to the Board of Directors, etc.

  • 3.Institutional investors should monitor investee companies so that they can appropriately fulfill their stewardship responsibilities with an orientation towards the sustainable growth of the companies.

The Company will strive to accurately understand the state of investee companies from the viewpoint of preventing damage to investee companies, improving corporate value and promoting sustainable growth in the medium to long term, by utilizing not only financial information on the companies, but also direct dialogue including non-financial aspects such as management strategy and responses to risks and ESG (Environment, Social, Governance).

  • 4.Institutional investors should seek to arrive at an understanding in common with investee companies and work to solve problems through constructive engagement with investee companies.

The Company will make an effort to arrive at an understanding in common with investee companies from the viewpoint of preventing damage to investee companies, improving corporate value and promoting sustainable growth in the medium to long term, through constructive "purposeful dialogue" with investee companies with a view to sustainability (medium- to long-term sustainability, including ESG factors), while deepening its understanding of investee companies and their business environments. In addition, when necessary to request that investee companies make improvements, the Company will strive to solve problems by conveying opinions from the standpoint of a shareholder.

  • 5.Institutional investors should have a clear policy on voting and disclosure of voting activity. The policy on voting should not be comprised only of a mechanical checklist; it should be designed to contribute to the sustainable growth of investee companies.

The Company's basic policy on exercising voting rights is as follows.

  • 1.Basic approach to exercising voting rights
  • The Company sees the exercise of voting rights to be an important means of influencing the management and improving the corporate value of investee companies. Therefore, decisions are not made uniformly based on formulaic short-term criteria, but rather in terms of enhancement of enterprise value in the medium-to-long term and improvement in shareholder returns, among others, based on dialogue with investee companies.
  • 2.Process of exercising voting rights
  • When exercising voting rights, items such as those listed below are verified for each proposal, with a focus on such aspects as whether the company in question is managed with an emphasis on growth of the company and the interests of shareholders, and whether the company is engaged in any antisocial behavior.
    Proposals are also judged based on the results of dialogue with the company concerned following a detailed examination of individual issues as required.
  • <Main evaluation criteria for each type of proposal>
    Type of proposal Matters for verification
    Appropriation of surplus
    • Status of shareholder returns
    Election of Directors
    • Status of enhancement of corporate value
    • Status of occurrence of scandals, etc.
    • Status of election of Independent Outside Directors
    • Status of attendance at Board of Directors meetings, etc.
    • Companies that fail to address sustainability issues.※
    • （※）mid to long-term sustainability, including Environmental, Social and Governance factors.
    Election of Audit & Supervisory Board Members and Accounting Auditors
    • Status of occurrence of scandals, etc.
    • Status of attendance at Board of Directors meetings and Audit & Supervisory Board meetings
    Officers’ remuneration and bonuses
    • Status of enhancement of corporate value
    • Status of attendance at Board of Directors meetings, etc.
    • Status of occurrence of scandals, etc.
    Retirement benefits and condolence money for officers
    Issuance of stock acquisition rights and stock remuneration
    • Any application of performance-linked remuneration, and recipients
    • Any decrease of equity ratio by existing shareholders
    Changes to the Articles of Incorporation
    • Examined individually
    Takeover defense measures
    • Examined individually
    Shareholder proposals
    • Examined individually
  • 3.Publication of the results of the exercise of voting rights
  • The Company believes that when conducting stewardship activities, it is important to hold continuous and constructive dialogue to enhance corporate value, prevent damage, and support the sustained growth of investee companies in the medium- to long-term, leading to a shared understanding and the improvement of any problems.
    The Company will not publish the results of the exercising of voting rights for each individual investee company, as this may affect constructive dialogue with said companies. However, in order to encourage understanding of the Company's activities, the Company will publish its approach to the exercising of voting rights, its criteria for voting decisions, aggregate voting records, and examples of proposals that the Company voted against.
  • 6.Institutional investors in principle should report periodically on how they fulfill their stewardship responsibilities, including their voting responsibilities, to their clients and beneficiaries.

The Company will periodically report on its stewardship activities on the Company's website.

  • 7.To contribute positively to the sustainable growth of investee companies, institutional investors should develop skills and resources needed to appropriately engage with the companies and to make proper judgments in fulfilling their stewardship activities based on in-depth knowledge of the investee companies and their business environment and consideration of sustainability consistent with their investment management strategies.

The Company is committed to ensuring stewardship activities are conducted more appropriately in the future by deepening its understanding of investee companies and their business environments, and by also conducting constructive "purposeful dialogue" with investee companies with a view to sustainability (medium- to long-term sustainability, including ESG factors).