1 2 3 4 5 6 7 8

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6 Governance
Corporate Governance
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48 Basic Approach including the release and disclosure of quarterly financial results and
management policies in a timely and accurate manner to bolster trust and
Governance Data ･･･････････ 51 Honda strives to enhance corporate governance as one of the most important appreciation from shareholders/investors and society. Going forward, Honda
tasks for its management, based on the Company’s basic principle, in order will continue to strive to ensure the transparency of its management.
to strengthen the trust of its shareholders/investors, customers and society; Please refer to “Honda Corporate Governance Basic Policies” and
encourage timely, decisive and risk-considered decision-making; seek Corporate Governance Report for Honda’s basic policy, structure and
sustainable growth and the enhancement of corporate value over the mid- to composition of members related to corporate governance, policy on the
long-term; and become “a company that society wants to exist.” appointment of Directors, an outline of self-assessment findings made by the
Honda has adopted a company with an Audit and Supervisory Committee Board of Directors and philosophy on remuneration for Executive Officers.
system with the aim of reinforcing the supervisory function of the Board (Please refer to the link below.)
of Directors and ensuring prompt decision-making. Under the system, the
Company operates “the Audit and Supervisory Committee”, which consists of WEB DATA
Directors, to delegate the authority to Directors from the Board of Directors “Honda Corporate Governance Basic Policies” Overview of corporate
and accelerate the separation of the supervisory function and business “Corporate Governance Report” governance
execution function.
https://global.honda/investors/policy/ p. 51
Honda is making efforts to appropriately disclose corporate information governance.html

Corporate governance structure (as of June 19, 2020)

General Meeting of Shareholders

Election/
Election/Dismissal Election/Dismissal Dismissal
Audit
Board of Directors Audit and Supervisory Committee Cooperation Accounting
13 Directors (including 5 Outside Directors) 5 Directors (including 3 Outside Directors) Auditors
Election/Dismissal/Supervision/ Proposal /
Delegation of authority Report Assistance Audit
Executive Council
Report Audit and Supervisory Committee Division
(Representative Directors and Executive Directors)
Report
Report Report Report
Business Ethics
Improvement Compliance Risk Management
Proposal Line Officer Officer
Supervision/ Proposal /
Delegation Report Audit Division
Compliance Global Emergency of authority
Committee Headquarters
Proposal
Compliance Risk Management
Report
Report
Internal audit
governance
Respective Operations (Regional/Business/Functional)/Subsidiaries

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6 Governance
Corporate Governance
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48 Corporate Governance as a whole. Accordingly, the Company appoints as its Directors persons
of superior character and insight who have high expertise and abundant
Governance Data ･･･････････ 51 Executive Decision-Making Process experience. Gender, nationality and other attributes are of no consequence.

Honda has adopted a company with Audit and Supervisory Committee Evaluation of Effectiveness of the Board of Directors
system in order to delegate the decision-making authority of executing For each fiscal year, the Company’s Board of Directors carries out an
important business matters from the Board of Directors to the Directors in evaluation of the Board as a whole for the purpose of checking the current
accordance with the provisions of the Company’s Articles of Incorporation state of its operational capabilities, subsequently, to enhance effectiveness.
and resolutions approved by the Board. The system enables quick decision- As same as the previous fiscal year, a self-evaluation was conducted by
making and prompt business execution while advancing to separate the Company for 2019. Based on the results of a questionnaire and interviews
management supervision and business execution so that the Board’s conducted with the Directors, the self-evaluation was deliberated and
function is concentrated to the overseeing of business execution. resolved at the Board of Directors. The self-evaluation questionnaire was
The Board has established criteria for deliberation and delegated some prepared under the supervision of outside attorneys. The interviews and the
of its authority to the Executive Council, which in turn delegates some of compilation of the results were carried out by outside attorneys as well.
its authority to the Regional Operating Boards. The Board of Directors shared the view that “effectiveness of the Board
The Executive Council conducts preliminary deliberation on items such is ensured appropriately”, by the constitution of the Board of Directors and
as that will be decided by the Board of Directors, and, within the limits of enhancing provision of useful information to Outside Directors. Further, they
authority delegated to it by the Board of Directors, deliberates on also shared the understanding of the needs to provide useful information
important management matters. Regional Operating Boards deliberate on and to have more thorough discussions over the macroscopic theme and
important management matters within their respective regions, within the future strategies to further enhance monitoring capabilities of the Board of
limits of authority delegated to them by the Executive Council. Directors.
The Company will further enhance monitoring capabilities of the Board
Board of Directors of Directors to raise effectiveness, by taking measures such as provision of
The Board of Directors is comprised of eight Inside Directors and five Outside sufficient information to Outside Directors and having thorough discussion
Directors. over the macroscopic theme and future strategies.
In order to respond to the mandate of the shareholders to achieve
DATA
sustainable growth and enhance the corporate value of the Company over
the medium to long term, the duties of the Board of Directors include Status of the meetings of the
making decisions concerning key Company matters such as its basic Board of Directors

management policies and monitoring of operations by Directors. In addition, p. 51

the Board of Directors discusses and makes decisions concerning matters
specified in the regulations of the Board of Directors, as well as matters set
forth in the
Articles of Incorporation and applicable laws. All other matters are delegated
to the Representative Directors or the Executive Directors.

governance In order to fulfill the above roles, the Company focuses on considering the
balance in the diverse knowledge and experience of the Board of Directors

Honda Sustainability Report 2020 38

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6 Governance
Corporate Governance
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Outside Directors Business Execution Management (Organizational Management)
Risk Management ･･････････ 48
Governance Data ･･･････････ 51 Honda appoints Outside Directors who have abundant experience and
deep insight, and who are capable of overseeing the entire business In order to facilitate quick and appropriate management decisions at
management of the Company from an objective, highly sophisticated and the regional and working levels, Honda appoints Operating Officers or
broader viewpoint based on the standpoint independent from the Company. Operating Executives who have been delegated the business execution
In selecting Outside Directors, the Company seeks to identify persons authority from the Representative Director or the Executive Director as
who have a high degree of independence. The five Outside Directors the responsible persons in their respective fields of Regional, Business
currently in office satisfy Criteria for Independence of Outside Directors and Functional Operations and other major organizational units.
and their interests are not in conflict with those of the Company nor the
shareholders. The five Outside Directors are specified as Independent
Directors as prescribed in a provision of the Tokyo Stock Exchange (TSE);
the names of those persons have been submitted to the TSE.
Please refer to “Honda Corporate Governance Basic Policies” for
Honda’s
Independence Criteria for Outside Directors. (Please refer to the link
below.)

WEB

“Honda Corporate Governance

Basic Policies”

https://global.honda/investors/
policy/governance.html

Support Systems for Outside Directors

Honda provides necessary support to Outside Directors through the
CEO Office or the Audit and Supervisory Committee’s Division in a timely
manner.
Materials on the Board of Directors’ agenda are distributed and
explained in advance for the Outside Directors, and the information
helpful for them to supervise the Company’s business is continuously
provided, including when they assume their respective positions.
governance Honda Sustainability Report 2020 39
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1 2 3 4 5 6 7 8

6 Governance
Corporate Governance
Corporate Governance ･･････ 37
Audit Organization Status of Activities to Strengthen the Functions of the Audit and
Compliance ･･･････････････ 45 Supervisory Committee
Risk Management ･･････････ 48 The Audit and Supervisory Committee comprises five members who are
The Company has formed the Audit and Supervisory Committee’s Division
Governance Data ･･･････････ 51 also Directors of the Company (including three Outside Directors). In order to
as a staff organization directly under the Audit and Supervisory Committee
respond to the entrustment of the shareholders, the Audit and Supervisory
to provide support to the Committee.
Committee shall conduct audits of the Directors and execute the duties of
In order to ensure the effectiveness of the audit, the Audit and Supervisory
the committee prescribed by laws and regulations with the aim of ensuring
Committee appoints two full-time members for the Committee.
sound and sustainable growth of the Company. Each Director serving as an
Mr. Masafumi Suzuki, a Director who is also a member of the Audit and
Audit and Supervisory Committee Member audits the execution of duties by
Supervisory Committee, has had sufficient operating experience in the
Directors in accordance with the auditing and supervisory criteria for the
finance and accounting departments of the Company and its subsidiaries,
Audit and Supervisory Committee, auditing policies and division of duties,
and Mr. Hideo Takaura, also a Director and a member of the Audit and
etc., as determined by the Audit and Supervisory Committee. The audit is
Supervisory Committee, has abundant experience and considerable
carried out through attendance at important meetings, examination of status
knowledge as a certified public accountant. Both of them qualify as
of management/company assets and other activities.
“persons with considerable knowledge related to finance and accounting,”
To provide timely and accurate reports to the Audit and Supervisory
as specified under Article 121-9 of Regulation for Enforcement of the
Committee, Standards for Audit and Supervisory Committee Reports
Companies Act of Japan. In addition, the Company’s Audit and Supervisory
are being established. Based on these standards, reports are made
Committee has recognized Messrs. Masafumi Suzuki and Hideo Takaura as
periodically to the Audit and Supervisory Committee on the status of
“specialists in finance in the Audit and Supervisory Committee” as specified
the business operations of the Company and its subsidiaries, the status
in the regulations of the U.S. Securities and Exchange Commission, based
of implementation and operation of internal control systems, and other
on Article 407 of the U.S. Public Company Accounting Reform and Investor
matters. Also, reporting is required whenever there is an item that has
Protection Act of 2002 (Sarbanes-Oxley Act of 2002). All five members of
a major impact on the Company. Candidates of Directors for Audit and
the Audit and Supervisory Committee remain independent as specified by
Supervisory Committee Members are selected by a resolution of the Board
the regulations of the U.S. Securities and Exchange Commission.
of Directors with the approval of the Audit and Supervisory Committee.
In addition to the above, the Audit Division, which was organized to
directly report to the President and CEO, conducts internal audits of each Director and Operating Officer Training
department of the Company. It also provides supervision and guidance
to internal audit departments in major subsidiaries, as well as directly Honda provides training in the Companies Act, corporate governance, etc.,
auditing subsidiaries when necessary. to operating officers who are considered as prospective director candidates,
and after they assume their respective position as directors, the Company
DATA also provides training to continually update their knowledge as necessary.
Honda provides training in industry trends, the Company’s history,
Status of meetings of the Audit
and Supervisory Committee business, finances, organizations, internal control system and other matters
to outside director candidates to be newly appointed, and after they assume
p. 51
their respective position as directors, the Company also provides with
opportunities including the visits to subsidiaries located in regions in order
to deepen their understanding of the Company Group’s business.

governance Honda Sustainability Report 2020 40

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1 2 3 4 5 6 7 8

6 Governance
Corporate Governance
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48 Tax Policy General Meeting of Shareholders and determined based on the progress of
financial indicators such as the consolidated operating margin during three
Governance Data ･･･････････ 51 The Honda Tax Policy prescribes the basic stance and thinking regarding consecutive fiscal years as well as the progress of non-financial indicators
taxes for Honda Motor Co., Ltd. and its consolidated subsidiaries. The policy such as brand value and environmental, social and governance (ESG) factors.
aims Please refer to Article 13 of the “Honda Corporate Governance Basic
to contribute to society as well as maintain and increase corporate value by Policies” concerning the policy for determining remuneration for Directors.
complying with the tax laws and regulations of each country and region (Please refer to the link below.)
where Honda undertakes business activities and by making proper tax
payments.
Tax systems of each country and region and international taxation rules
are
frequently changed. In this environment, to ensure the proper execution of its WEB DATA
business in a stable manner Honda carries out accurate and high-quality tax Annual total remuneration and bonuses of highest -
“Honda Corporate Governance
affairs and responds to tax risks associated with its businesses in Basic Policies”
paid individuals (President and Representative
Director, Chief Executive Officer) (Japan)
accordance with the Tax Policy.
For details, please refer to the Honda Tax Policy. (Please refer to the link https://global.honda/investors/ p. 51
policy/governance.html
below.)

DATA DATA
DATA
Total amount of remuneration for Rate of increase in annual total remuneration and
bonuses of highest-paid individuals (President and
Honda Tax Policy Directors and Corporate Auditors Representative Director, Chief Executive Officer) (Japan)
p. 51 p. 51
p. 52

governance Remuneration of Directors

Remuneration of Directors (excluding those serving as Audit and Supervisory
Committee Members) is paid from a maximum allocation for this purpose
approved by the General Meeting of Shareholders, based on the remuneration
criteria approved by the Board of Directors. Bonuses of the Directors (excluding
Outside Directors and the Directors who are Audit and Supervisory Committee
Members) are paid within the maximum limit approved by the General
Meeting of Shareholders and decided by the Board of Directors, based on the
Company’s performance during the applicable fiscal year, dividends paid to
shareholders, criteria for associates’ bonuses and other considerations.
Additionally, Honda introduced a stock-based remuneration system for
Directors who are residents of Japan (excluding Outside Directors and
Directors who are Audit and Supervisory Committee Members). The
purposes of this system are to further enhance the motivation of Directors for
contributing to the sustainable growth of corporate value over the medium
to long term and to promote the sharing of interests between the Directors and
shareholders. Under the system, the level of remuneration paid and the
delivery of shares shall be within the maximum limit decided at the Ordinary
 lity Report 2020 41
Remuneration of Accounting
Auditors

The Company has had its financial

statements audited in accordance
with the Companies Act of Japan, the
Financial Instruments and Exchange
Act of Japan, the Securities Exchange
Act of 1934 (United States) and the
Exchange Act of 1933 (United States)
by KPMG AZSA LLC. Within KPMG AZSA
LLC, a total
of 75 staff members conducted
external audits of the Company’s
financial statements. These
accounting firm staff members are
composed of 3 certified public
accountants (Hiroshi Miura, Tomoo
Nishigori and Takeshi Kamada), who
are in overall charge of the Outside
Audits, and 72 professional staff
members (including 24 certified public
accountants and 48 other staff
members).
In deciding the amount of
remuneration for services rendered
by the Accounting Auditor, various
factors are taken into consideration
in discussions with the accounting
firm, including the Company’s
size/characteristics, the time
schedule for the audit and other
matters. In addition, to preserve the
independence of the Accounting
Auditor, remuneration to be paid is
required to obtain the prior
approval of the Audit and
Supervisory Committee.

H
o
n
d
a
S
u
s
t
a
i
n
a
b
i
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Governance
Corporate Governance
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48
Directors (as of June 19, 2020)

Governance Data ･･･････････ 51

Chairman and Director President and Representative Director
Toshiaki Mikoshiba Chief Executive Officer
Takahiro Hachigo
【Reasons for Appointment】 【Reasons for Appointment】
Mr. Toshiaki Mikoshiba has broad experience primarily in the area of sales and Mr. Takahiro Hachigo has broad experience primarily in the areas of research
marketing, as well as abundant international experience, and is familiar with and development, production and purchasing, as well as abundant
Honda Group’s business including overseas operations. In the fiscal year international experience, and is familiar with Honda Group’s business
ended March 31, 2020, he has properly fulfilled his duties as Chairman and including overseas operations. In the fiscal year ended March 31, 2020, he
Director, Chairman of the Board of Directors and Director in charge of has properly fulfilled his duties as President and Representative Director,
Government and Industry Relations by enhancing the functions of the Chief Executive Officer and Director in charge of Research & Development by
Company’s external relations, as well as overseeing business execution from a demonstrating strong leadership and being responsible for the management of
global perspective through managing the Board of Directors as its Chairman. the entire Company Group, as well as overseeing business execution.

Executive Vice President and Representative Director Senior Managing Director

Chief Operating Officer Chief Financial Officer
Seiji Kuraishi Kohei Takeuchi
【Reasons for Appointment】 【Reasons for Appointment】
Mr. Seiji Kuraishi has broad experience primarily in the areas of supply chain Mr. Kohei Takeuchi has broad experience primarily in the area of accounting
management and sales and marketing, as well as abundant international experience, and finance, as well as abundant international experience, and is familiar with
and is familiar with the Company Group’s business including overseas the Company Group’s business including overseas operations. In the fiscal
operations. In the fiscal year ended March 31, 2020, he has properly fulfilled his year ended March 31, 2020, he has properly fulfilled his duties as Chief
duties as Executive Vice President and Representative Director, Chief Operating Financial Officer and Director in charge of Finance and Administration by
Officer, Director in charge of Strategy, Business Operations and Regional Operations, overseeing business execution in the area of management from a global
and Chief Officer for Automobile Operations by demonstrating strong leadership and perspective and based on his high degree of expertise.
being responsible for business execution of the entire Company Group, as well as
overseeing business execution.

Senior Managing Director

Director
Toshihiro Mibe
Hiroko Koide
【Reasons for Appointment】
Mr. Toshihiro Mibe has broad experience primarily in the areas of R&D and 【Reasons for Appointment】
production, and is familiar with the Company Group’s business including Ms. Hiroko Koide has over 30 years of experience working for foreign
overseas operations. In the fiscal year ended March 31, 2020, he companies, including over 15 years which she served as an executive, and
demonstrated high degree of expertise and strong leadership, and achieved has a global perspective as well as abundant experience and deep insight
satisfactory results as President and Representative Director of Honda R&D regarding corporate management. She has properly fulfilled her duties
Co., Ltd. and Managing Officer in charge of Intellectual Property and as Outside Director since June 2019 by overseeing the entire business
Standardization of the Company. management of the Company from an independent standpoint.

governance
Director
Fumiya Kokubu

【Reasons for Appointment】

Mr. Fumiya Kokubu held positions of President and CEO, and Chairman of the
Board of Marubeni Corporation from 2013, and has abundant experience and
deep insight regarding corporate management.
 Director and Advisor
Takanobu Ito

【Reasons for Appointment】

Mr. Takanobu Ito served as President and
Representative Director of the Company. He has
abundant experience and deep insight regarding
corporate management, and is familiar with the
Company Group’s business including overseas
operations. In the fiscal year ended March 31,
2020, he has properly fulfilled his duties as
Director and Advisor by undertaking the role of
the Company’s external relations with
economic organizations, etc., as well as
overseeing business execution from a global
perspective through expressing his opinions and
providing suggestions regarding management.

Honda Sustainability
Report 2020
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6 Governance
Corporate Governance
Corporate Governance ･･ ･ ･ ･･ 37

Compliance ･･･････････････ 45 Directors (Audit and Supervisory Committee Members) (as of June 19, 2020)
Risk Management ･･････････ 48
Director (Audit and Supervisory Director (Audit and Supervisory
Governance Data ･･･････････ 51 Committee Member)(full-time) Committee Member)(full-time)
Masahiro Yoshida Masafumi Suzuki

【Reasons for Appointment】 【Reasons for Appointment】

Mr. Masahiro Yoshida held positions of Managing Officer and Director and Chief Mr. Masafumi Suzuki held the position of General Manager of Accounting
Officer for Business Support Operations of the Company. He has high expertise Division for Business Management Operations of the Company. He has high
and abundant experience in the area of administration such as human resources expertise and abundant experience in the area of accounting and finance and
and corporate governance and is familiar with the Honda Group’s is familiar with the Honda Group’s business including overseas
business including overseas operations. He has properly fulfilled his duties as operations. He has properly fulfilled his duties as Director who is an Audit
Director who is an Audit and Supervisory Committee Member since June 2017 by and Supervisory Committee Member since June 2017 by auditing and
auditing and overseeing the execution of duties by Directors. overseeing the execution of duties by Directors.

Director (Audit and Supervisory

Committee Member) Director (Audit and Supervisory
Committee Member)
Hideo Takaura
Mayumi Tamura
【Reasons for Appointment】
Mr. Hideo Takaura has high expertise and abundant experience as a 【Reasons for Appointment】
Japanese certified public accountant and has properly fulfilled his duties as Ms. Mayumi Tamura has abundant experience and deep insight regarding
Outside Director who is an Audit and Supervisory Committee Member by corporate management and has properly fulfilled her duties as Outside
auditing Director who is an Audit and Supervisory Committee Member by auditing
and overseeing the execution of duties by Directors from the standpoint and overseeing the execution of duties by Directors from the standpoint
independent from the Honda Group. independent from the Honda Group.

Director (Audit and Supervisory

Committee Member)
Kunihiko Sakai

【Reasons for Appointment】

Mr. Kunihiko Sakai has high expertise and abundant experience as a legal
affairs specialist having served as Public Prosecutor for many years, including
posts of Superintending Prosecutor at High Public Prosecutors’ Offices
from July 2014 to March 2017.

governance Honda Sustainability Report 2020 43

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6 Governance
Corporate Governance
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48 Managing Officers (as of April 1, 2020)
Governance Data ･･･････････ 51
Michimasa Fujino Shinji Aoyama
● President and Director, ● Chief Officer, Regional Operations (North America)
Honda Aircraft Company, LLC
● President, Chief Executive Officer and
Director, Honda North America, Inc.
● President, Chief Executive Officer and
Director, American Honda Motor Co.,
Inc.

Noriya Kaihara Mitsugu Matsukawa

● Head, Business Supervisory Unit, ● President and Director, Honda of
Automobile Operations America Mfg., Inc.

Noriaki Abe
Yasuhide Mizuno
● Chief Officer, Motorcycle
Operations ● Chief Officer, Automobile Operations

Katsushi Inoue
Hisao Takahashi
● Chief Officer, Regional Operations (China)
● General Manager, Mono-zukuri Center,
● President, Honda Motor (China) Investment Co., Automobile Operations
Ltd.
● Director, Honda R&D Co., Ltd.
● President, Honda Motor (China) Technology Co.,
Ltd.
governance Honda Sustainability Report 2020 44
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6 Governance
Compliance
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48 Honda Code of Conduct particularly high importance, deliberation or reporting at a meeting of the
Executive Council or the Board of Directors is carried out depending on the
Governance Data ･･･････････ 51 In order to earn the trust of customers and society and grow sustainably, details of the matter.
companies must not only comply with laws and regulations but go beyond those The Compliance Committee met four times in FY2020 to report on the
legal structures by practicing ethical corporate conduct. establishment and operating status of internal control systems as well as the
Recognizing this, Honda formulated the Honda Code of Conduct, which operating status of the Business Ethics Kaizen Proposal Line, among other things.
summarizes the sincere behavior to be practiced by people working at Honda There were no major violations of laws or regulations in
around the world. This is shared throughout the entire Honda Group, including FY2020.
subsidiaries in Japan and overseas.
The Company works to instill the Honda Code of Conduct in each and every
associate through actions such as the distribution of leaflets, posting of Message

information on its intranet and through training. Each of Honda’s departments and
subsidiaries regularly checks the status of such activities to ensure awareness of
the Code and reports to the Compliance Committee.
Guided by the fundamental beliefs of “Respect for the Individual” and “The Three Joys” (“The Joy of Buying,”
“The Joy of Selling,” and “The Joy of Creating”), Honda endeav ors to share joy with peo ple around the world
and aspires to be “a company society wan ts to exist.”

WEB A prerequisite to fulfilling this philosophy is to act with integ rity to customers an d society at all times. Failure
in our duty to maintain sin cerity would result in loss of the confidence and tru st we have established over the
years; a precio us asset that would be extremely difficult to recover.

For this reason, in 2003 we announced and subsequently implemented the Honda Conduct Guidelines. During this
time, Honda has expanded its business throughout the globe, and I feel that expectations from stakeholders, including

“Honda Code of Conduct”

customers, have grown greater as well.
This also reflects the increasing importance for each of us to act responsib ly, as expected by cu stomers and
society.
In view of these trends, we have revised the Honda Conduct Guidelines as the “Honda Code of Conduct”
covering acts of integrity for Honda associates around the world.

Our founder Soichiro Honda once said, “What you make reflects you.” I also believe that a sincere attitude toward
customers on the part of each individual Honda associate is what creates excellent products and services.

https://global.honda/about/
The continuou s growth of Honda depends on the app ropriate cond uct o f each Honda asso ciate toward
customers and society. I would like y ou to bear in mind that every action you take represents Hon da, and to act
in accordance with the Co de.

codeofconduct.html

Compliance Committee
Takahiro Hachigo
President, CEO and Representative Director

Honda 1 Code of Conduct

Honda Code of Conduct

To improve compliance within the Honda Group, Honda has established a Relationships with
Shareholders, Investors, and
Compliance and Reporting
Non-compliance Incidents
Other Stakeholders

Compliance Committee, headed by a Compliance Officer designated by the Relationships with Society
Timely and Appropriate Disclosure of
Information
Relationships with Political
and Administrative Entities
Compliance
o
Ho
and Ethics
onnda’s policy
Hondda
on cont inuously carries out initiatives to strengthen
Honda’s policy

Board of Directors. This Committee is composed of the Compliance

coomppliance
m in order to reinforce the trust establi shed with
In order to remain a highly transparent company, Honda strives society.
ith Person s wh o work at Ho nda are also
fo r ap propriate co mmun icatio n with custo mers, business
rq
equired
ui t o comply with relevant laws, reg ulatio ns, and
Traffic Safety Reellationships with Political and
partners, shareho ld ers and inv esto rs, lo cal commun it ies, an d
other stak eholders.
poolicies
lic while acting eth icall y.
i
Relationships with Colleagues Relationships with Honda Administrative Entities Re
eqquired conduct
Honda’s policy Required conduct
/ Work Environment (Company Assets)
Honda will develop advanced safety technolog ies and engag e in I will ap prop ri ately disclo se i nformatio n in co mp lian ce with
Hoonnda’s policy
I will
wil comply with laws, reg ul atio ns and company
l
poolliciciies.
activities to p ro mo te safe driving with the aim o f realizing a laws, regulations, and company policies when eng ag in g in
I willll act ethically in accordance with social norms and common
Ass ann
discloa suindep
re ofendent corporate
informatio entity,
n to ou tside Honda
parties maintains
and interact pp pr
with
safer motorized society. sense.
apriate
stak roolrelationships
peh wi th political
ders in a co urteou s manner.en tities (political rrga

Communication
Communicationininthe
theWorkplac
Workplace e Coompanyconduct
Individual Assets oizati
ganons and politicians) and administrati ve ent ities
overnmental agencies an d go vernment offici als).
(gove

Relationships with Customers Relationships with Business I will ob ey traffic rules, observe go od d riving eti qu ette, and

Officer as well as Directors, Operating Officers or persons in charge of

Honda’s policy
Honda’s policy en
Hodeavor to driv
Honnda’s e safely .
policy Re
eqquired conduct Reporting Non-compliance Incidents
Partners
onda strives
HHonda to to
strives create
create woworkplaces
rk pl aces in in
which co-workers
which co-workers ccan Hondda
Hon wi ll ap propriately maintain and manage all Iwwill
ill interact with political and ad ministrative en tities in
trust
an trust
one another
one another
at allattimes.
all times ccomppany
om assets, both tangible and intangible, as een terprise a apppropriate
nn a manner in co mp liance with laws, gulations, Req
equired conduct
resources
nter to achieve its business objectives . ran
egul
d company p olicies and will n ot o ffer olititiicians or
pgovernment officials entertainment nor iiffttss (both If IIbecome
be aware of any violation or pos sible violation o

Quality of Products and Services RReeqquiuirreded ccoonndduucctt

Sound Business Practices l aws,
f a regu lations or co mpan y p olicies, I will repo rt the
Reqquired
Re conduct gmonetary and non-monetary) that are rroohhiibited by laws,
mateter,
m submit su ggestions, an d co nsult as necessary with
II wwiillll ssttrriivvee ffoorr ssmmooootthh pregulations, and company policies.
IIwil
will appropriately handle company as sets and not eengage

respective functional operations who are appointed by the Executive Council.

myece
manager, the legal department, or thee compliance &
ccoommmmuunniiccaattiioonn iinn tthhee
inlnga
acts that damage the value of company aassets.
Honda’s policy Honda’s policy
wwoorrkkppllaaccee ttoo crcreeaattee aa ethics co nt act line*.
II sset
will appropriately handle facil ities, equipment, tools,
hhaarrmmononiioouuss wwororkk eennvivirrononmmeenntt. *Thhiiss iincludes the internal whistleblower hotlines established by the grooup
Ho nda strives t o provide produ cts an d services t hat exceed Honda will engage in sound bus iness practices under an pproducts,
wil
rod par ts, accessories, items sup pli ed by the companies.
the expectations of cu stomers an d society . In t hi s sense, it i s environmen t of free an d open competition which is built u po n lom
ccomppany, money, intel lectual property, and all other
essential to p lace th e h ig hest priority o n quality and safety, mu tu al trust with su ppliers, distributors/dealers, ccoomppany assets in co mp lia nce with co mpany policies
voluntarily establi sh high standards, and resp on d in an su bcon tracto rs and all other bu siness p artners, while aimin g to aanndd nnot use them for anything other than for achieving
approp riat e manner. build long-term, con struct iv e rel atio nshi ps with th em. HHoonndda’s busin ess o bjectives.

The Committee makes decisions regarding important internal control system

Required conduct Required conduct Environmental Protection
I will place the high est p ri ority o n th e q uality and safety of I will comply with th e following in o rd er to maintain
products as well as services, and comp ly with estab li shed so un d relatio nships with business partners: Management of Information
Honda’s policy
stan dards and procedures. I wil l also request business
I will carry out ap propriate p ro cedu res in accordance with Hond a actively end eavo rs to p ro tect the global
partners and distributors/deal ers to adhere to Honda’s
company policies in sel ecting busi ness partn ers, and will Honnda’s
Ho
environment policy
th ro ug hout all busi ness activ ities as a
standards and procedures.
co mp ly with laws, regulations, and company policies respo
Hon nsib
Hondda wilellmember of society
ap propriately . and manage co nfid en tial
protect

measures, which include formulating and amending of compliance policies. In

related to bu siness t ransact io ns. information
co nfi and person al in fo rmatio n that holdss for the it
Required
purpose
hold conduct
of conducting proper business oper t io ns.
I will not receive from or p ro vide to bu siness p artn ers
Iopera
wil l comp ly with laws and reg ul atio ns, co mp any policies,
benefits in the form of g oods (both mo netary and non- Reqquired
Re
an d internal stanconduct
dards related t o env iron mental p ro tection and
monetary) or entertainment beyond what is
striv
II wil e to
will reduce t he bu
appropriately rd en confidential
handle on the environment by engaging
information such aasin
generally considered app ro priate by society. I wil l also no t ls intrceinformation,
resou
internal con servation, energ ypartne
business conservation, and recy
r information aanclin
d g.
Honda’s
use my popolicy
RRespecespectt ooff HuHummaann RRiigghhttss
sition o r au th ority to receiv e improp er ben efit s
personal
nd p informa tion of customers and other
fro m interested p arti es.
onda strives to mai nt ain its stance as a co mp any

addition, the responsibilities of the Committee encompass from confirming

aasso
ssoc iates in co mp liance with laws, regulations, and
o mmitted to practicin g fai rn ess and sin cerit y an ccoomppany policies. I must also refrain from il legitimate
Honda’s policy
espects human rights
Contribution to Society
uussee oof such information for insider trading or other
HHonda strives to maintain its stance as a company iimpprroper deeds.
Required
ccommitted conduc
to practicing fairness and sincerity andd
rrespects human
wi ll respect fel rights..
lo w associates, i nt eract with them in a Honda’s policy
Hond a strives to con tribute to so ciety throug h its b usiness
Required conductt Coonflicts of Interest
activities, su ch as the provisio n of prod ucts and services that

the status of establishment and operation of internal control systems to

Appropriate Advertising and Publicity II will respect fellow associates, interact with them in a ex ceed th e expectations o f cu stomers and society. Honda also
ssiinncceerree aanndd aapppprroopprriiaattee mmaannnneerr,, Ho in socially
engages
Honnda’s beneficial activities to fulfill its so cial
policy
aanndd nneevveerr eennggaaggee iinn aanyny ffoorrmm ooff respo nsib ility as a corpo rate cit izen.
Honda’s policy hhaarraassssmmeenntt oorr uunnjjuusstt,,
As
As aa measu re t o ensure app ro priate busin ess ooperations,
Honda
per prohibits any condu ct by associates tthat con flict with
Honda engages in advertising , publicity, and sal es promotion ddiissccrriimmiinnaattoorr yy bbeehhaavivioro r iinn tthhee Required conduct
the
hatinterest s o f Ho nda.
activities in good faith so as to co nstantly meet the trust and wwororkkppllaacece.. I will fully acknowledg e Hond a’s b asic stance to
expectations of cu stomers an d so ciety.
co ntri bu te to so ciety and striv e to fulfill o ur expected rol es
R
Reeqquired conduct Hon da 6 Co de o
ff Cond
Con uct

performing oversight to ensure the

Honda’s policy in th e commu nity .
Required conduct IIwwiillll not engage in acts that conflict with the interests of

I will properly eng ag e in prod uct advertising, pub lici ty , an d

SSaaffetetyy
onda will provide aaanndd HHeeaalltthh
safe and h ealthy workplace t H oonndda for my own benefit or the benefit of business
aintain a pleasant and safe wo rk environmen t Hparr tners or th ird parties.
sales p ro mo tion acti vi ties to avoid mislead in g cust omers.

Honda’s
Required policy
conduc
H onda 5 Code off
Compliance with Competition Laws HHonda will
ly provide a safe
regand healthy workplace
companytoo

appropriate management of the Business Ethics Kaizen Proposal

will co mp with laws, ulations and
mmaintain a pleasant and safe work environment..

Honda’s policy Required conductt

Honda will eng ag e in free and op en competiti on with II will comply with laws, regu lati on s and company
competitors to maintain it s stan ce as a company trusted by ppoolliicciieess rreellaatteedd ttoo ssaaffeettyy aanndd
customers and society. hheeaalltthh,, ssttrriivvee ttoo mmaaiinnttaaiinn aa ssaaffee
aanndd hheeaalltthyhy wwoorrkkppllaaccee,, aass wweellll aass ff

Line and deciding measures to prevent recurrences when serious compliance-

Required conduct pprreevveenntt aanndd miminniimimi zzee acaccidcid eennttss.

I will comply with competition laws (antit rust laws).

Honda Code of Conduct

related matters occur. For matters of compliance that are of
H onda 3 Cod e o f Con du ct

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6 Governance
Compliance
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48 Business Ethics Improvement Proposal Line Initiatives to Prevent Bribery
Governance Data ･･･････････ 51 Honda established the Business Ethics Kaizen Proposal Line as a structure for Honda prohibits bribery.
improving corporate ethics issues. This hotline addresses issues involving The Honda Code of Conduct requires that the Company complies with laws and
corporate ethics in cases of actions that violate laws or internal rules. This allows regulations, and states that “as an independent corporate entity, Honda maintains
the Company to accept proposals and provide consultation, from a fair and neutral appropriate relationships with political entities (political organizations and
standpoint, for associates who face barriers politicians) and administrative entities (governmental agencies and government
in improving or resolving issues in the workplace for reasons such as difficulties in officials)” and “will interact with political and administrative entities in an
consulting with superiors. appropriate manner in compliance with laws,
Furthermore, in addition to cases of a clear violation of laws or internal rules, regulations and company policies and will not offer politicians or government
this hotline provides consultation and responds to inquiries about the details of officials entertainment or gifts (both monetary and non-monetary) that are prohibited
internal rules when questionable actions have occurred, and also engages in fact by laws, regulations and company policies.”
checking related to such cases. Proposals are accepted by email, letter, telephone or In addition to the above, the Company also established the Honda Policy on the
fax from all subsidiaries and suppliers in Japan and overseas, as well as from the Prevention of Bribery, which stipulates basic policy, and the Honda Guideline for
parent company. We ensure protection of the Kaizen proposers and anonymous the Prevention of Bribery, which stipulates compliance items and prohibited items,
proposals are also accepted. with a focus on prevention of bribery.
Moreover, the Company established a point of contact within an external law In addition to raising awareness by integrating bribery prevention related
office to facilitate associates to submit proposals. As for overseas, local points of knowledge into Honda’s level-specific training programs, it is also incorporating
contact have been established in all Regional Operations, while some subsidiaries e-learning-based training for its associates in management
set up their own points of contact. positions in departments that face a higher risk of bribery. With regard to its
In FY2020, 429 proposals and consultations were handled by the Business Ethics subsidiaries, Honda has launched training programs, matched to conditions in each
Kaizen Proposal Line (including points of contact outside the Company). Among company, aimed at raising awareness.
these, 192 concerned the parent company, 231 concerned subsidiaries and 6
concerned other matters. Following investigations of
the proposals and consultations submitted, disciplinary action was taken in one
case in the parent company and four cases in subsidiaries. One case involving a
subsidiary resulted in punitive dismissal. None of the cases involved violations of
the Honda Policy on the Prevention of Bribery.
In order to raise internal awareness of the points of contact, Honda provides
notice on its intranet, distributes information cards to all associates, including
fixed-term employees and temporary workers, and displays information posters in
each workplace. These tools clearly state that the Kaizen proposers are protected. In
addition, Honda observes how well
these points of contact are recognized through associate surveys conducted once every
three years for all associates. For departments found in these surveys to have low
recognition of the points of contact, the Company makes additional efforts to increase
their awareness.

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6 Governance
Compliance
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48 Initiatives for the encouraging procurement in line with the guidelines.
Since 2013, Honda has surveyed its suppliers worldwide concerning the use
Governance Data ･･･････････ 51 Prevention of Anti-Competitive Behavior of conflict minerals. In FY2020, Honda received responses from more than
7,000 suppliers. In addition to reporting survey results to the SEC, the
As a company engaged in business globally, Honda takes great care in its daily
Company also makes them publicly available on its website. (Please refer to the
business activities to comply with competition laws in the countries where it
link below.)
operates.
In the event that the survey reveals any minerals of concern, regardless of
The Honda Code of Conduct states that “Honda will engage in free and
source country, Honda works together with its suppliers to take appropriate
open competition with competitors to maintain its stance as a company trusted
measures. The Company is also working to improve the accuracy of its survey,
by customers and society” and that each associate “will comply with
requesting further investigation when survey responses are insufficient.
competition laws (antitrust laws)” to ensure compliance with
competition laws.
PDF
As a part of its measures to strengthen compliance, Honda implements
individual training for related departments on anti-competitive behavior. It also “Honda Supplier Sustainability Guidelines”
incorporates programs on the topic of anti-competitive behavior in level-
specific training at the time of personnel promotions and in https://global.honda/about/dam_img/sustainability/
report/pdf/supply-chain/supplier-sustainability-guidelines.pdf
pre-assignment training for persons stationed overseas. Additionally, Honda
publishes awareness-raising content concerning anti-competitive behavior on the WEB
Company’s intranet for its associates. Under the IR Library website “Form SD/
Conflict Minerals Report”

Rules on Conflict Minerals https://global.honda/investors/library.html

The final rule for disclosure on conflict minerals adopted by the U.S. Securities
and Exchange Commission (SEC) mandated by the Dodd-Frank Wall Street
Reform and Consumer Protection Act (the Dodd-Frank Act) requires corporations
to confirm that the purchase and use of conflict minerals from the Democratic
Republic of the Congo and adjoining countries are contributing neither to the
funding of armed groups nor to the abuse of human rights in that region.
Honda’s policy is to aim to be free from conflict minerals which
contribute to the funding of armed groups or human rights infringement. To
achieve this goal and to help resolve the global problem of conflict minerals, the
Company is actively engaged with domestic and
international industry organizations and its suppliers.
With its suppliers, Honda shares the Honda Supplier Sustainability
Guidelines that summarize what is expected of them with regard to CSR
activities, including how to deal with conflict minerals, and is

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6 Governance
Risk Management
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48 Establishing an Effective the judgement of the company-wide Risk Management Officer, giving consideration to
the risk status of each of the Operations. The Company then shares and discusses
Governance Data ･･･････････ 51 Risk Management company-wide priority risks at the Executive Council.

Structure
Honda formulated the Honda Global Risk Management Policy, with Group Risk Assessment Activity Structure
subsidiaries included in its scope of application.
The Honda Global Risk Management Policy aims at driving the Company’s
Executive Council
sustainable growth and stabilizing management based on the Honda Philosophy and
targets all risks with the potential to impact operations on a global scale. Global Risk Management
In implementing its risk management activities, Honda is creating a
relevant framework and is taking follow-up measures to support
Company-wide priority risks
implementation, with efforts centered around a company-wide Risk
Company-wide Risk Management Officer decision
Management Officer elected by the Board of Directors.
Additionally, each organization is building its own independent risk
management structure after setting up a Risk Management Secretariat. These Each Business Each Functional
Each Regional Operation Operation Operation
organizations are responsible for promoting their own independent risk
management activities in accordance with the basic policies of these regulations. Operations Operations
Operations priority risks priority risks
As main initiatives, Honda is implementing risk assessment activities priority risks
Decision of Operations Risk Management Officer
throughout the Company for identifying, evaluating and responding to risks based
on standard methods.
Each Division Each Division
When a crisis occurs, the Company establishes a Global Emergency Headquarters Divisions Divisions
for crisis response proportionate to the anticipated magnitude of impact. priority risks priority risks
〈Risk items〉

Identify and assess risks

・Business risk

Identify and assess risks

Risk Assessment Activities ・
・Environmental

Risk response
・

Risk response
・ risk
Honda carries out risk assessment activities for each of its Regional Operations, ・Legal risk, etc.
＋
Business Operations and Functional Operations. 〈 Common evaluation
The purpose of these activities is to foresee potential risks surrounding Honda’s
businesses and respond beforehand to minimize these risks. criteria〉
Each department performs annual risk evaluation using the Group’s common risk ・Status of e
counterm rren
items and evaluation criteria to identify the division priority risks. ct
・Frequency of
Each of the Operations carries out repeated discussions based on the results of the occu
asures
risk assessment of each department. They then identify and respond to the
ce
Operations priority risks based on the judgement of the Operations Risk
Management Officer.
Moreover, Honda identifies company-wide priority risks based on

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6 Governance
In addition, in FY2020 we reconfirmed the basic actions in crisis response based
Risk Management on the assumption that the Nankai Trough earthquake has occurred. These measures
Corporate Governance ･･ ･ ･ ･･ 37
included discussing matters specific to each group as well as sharing information
Compliance ･･･････････････ 45
In FY2020 as well, Honda identified company-wide priority risks, which will be among groups and improving the speed and accuracy of the matters to be discussed
Risk Management ･･････････ 48 addressed mainly by the departments in charge. In the meantime, the status of based on the information.
Governance Data ･･･････････ 51 progress is confirmed and discussed at the Strategy Committee. Also with regard to disaster drills, besides ensuring the safety of human life and
procedures to account for its associates, Honda continuously holds training from a
Company-wide priority risks business continuity planning (BCP) viewpoint on procedures to share information
for the purpose of identifying the impact on business at an earlier stage.
● Infectious diseases becoming prevalent Risk
Global Emergency Headquarters Structure
● Regional Risk
● Information Security Risk
Global Emergency Headquarters Manager
● Business Alliances and Joint Ventures Risk
Company-wide Risk Management Officer
● Intellectual Property Risk
● Natural Disasters Risk
Head of Secretariat
● Financial & Economic Risk (Economic trends and economic
Risk Manager
fluctuations risks, Currency Fluctuations Risk)
Going forward, Honda will firmly establish these activities and continue to strive
to reduce risk across the Group while ensuring these activities raise the risk
awareness of each and every associate. Operation Associat Financial Disaster Area Public Relevant
s e Respons Response Relations Divisions
Response Respons e Group Group Response
Crisis Response Group e Group Group
Since the World Health Organization (WHO) declared the outbreak of novel coronavirus a
Honda carries out risk sensing activities to monitor and report on signs of crisis Public Health Emergency of International Concern in January 2020, COVID-19 has spread
and ensures that this leads to quick responses. around the world. The highly infectious disease has forced many countries to resort to
When a crisis occurs, the Company sets up a Global Emergency Headquarters measures that include social distancing and limiting their citizens’ movements, bringing
economic and corporate activities to a standstill.
for crisis response proportionate to the anticipated magnitude of impact. In this
The impact of the spread of COVID-19 has also been felt at Honda, with production
way, Honda lays out a structure to prevent the situation from spreading and to
having been either suspended or curtailed and dealers shut down in the Motorcycle,
quickly bring the situation under control.
Automobile, Life Creation and other businesses.
Since the Kumamoto earthquakes that occurred in April 2016, the activities of In light of the heavy impact reverberating throughout the Company, we established the
Honda’s Global Emergency Headquarters strive to strengthen functions. Global Emergency Headquarters in January 2020. While placing utmost priority on the
As the first step, to share information and discuss activities on a daily basis, safety of its customers, business partners, associates and other stakeholders, it coordinates
group leader meetings are held to convene the group leaders essential for crisis the information sharing among relevant parties in and outside the Company and
responses. By holding these meetings, Honda is striving to raise the level of its implements company-wide measures to minimize the impact of COVID-19 on business
crisis response capabilities as well as create a culture that enables effective activities.
cooperation when a crisis occurs. Honda has been gradually resuming its business activities based on developments in
Next, Honda regularly holds Emergency Headquarters drills as a verification local regulations and the supply of parts, upon taking measures such as checking
of its crisis response capabilities. In FY2019, Honda held drills for making employees’ temperatures and ensuring social distancing in work areas.
crisis responses spanning multiple business bases on the assumption that a
large earthquake occurs directly under the Tokyo metropolitan area.

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6 Governance
Risk Management
Corporate Governance ･･ ･ ･ ･･ 37
Compliance ･･･････････････ 45
Risk Management ･･････････ 48 Information Management Protection of Personal Information
Governance Data ･･･････････ 51 In FY2015, Honda formulated the globally common Global Confidentiality Honda recognizes the importance of protecting personal information. Accordingly,
Policy (GCP) as a basic policy for information management and set up the the Company has appointed information supervisors and information managers in
Global Confidentiality Committee, which takes the lead in information departments handling personal information. At the same time, Honda implements
management efforts. training on the protection of personal information with the aim of ensuring
Based on the GCP, Honda undertakes activities to ensure the safe handling of compliance and the proper handling of this information.
information generated in business activities such as personal information of its In addition, to systematically manage personal information, departments handling
customers and associates, important management information as well as blueprint personal information report such information to the Confidentiality Committee of each
data of products and facilities. company. To keep the details of the reports updated, the Company conducts a review at
As the person with responsibility for the Global Confidentiality Committee, the least once each year at all departments.
Chief Officer of the Human Resources and Corporate Governance Operations serves In FY2020, Honda established and began operating even more strict security
as its chairperson. Under the Committee, a regional confidentiality structure has standards with the aim of strengthening the security of information systems that
been established to supervise each region. include customer information.
At the Global Confidentiality Committee, members formulate globally common Moreover, to reliably respond to personal information protection laws in each
medium-term policies and promote initiatives in each region. country, at the Global Confidentiality Committee held in December 2018 Honda
In Japan, in response to the determination of the policies of the Global reached a consensus with all regions on its approach. In FY2020, Honda steadily
Confidentiality Committee, Honda promotes initiatives to strengthen information responded to the laws and regulations of each country.
management throughout the year, led by the Japan Confidentiality Committee. In the event of leakage or request for disclosure of personal information, Honda is
The Global Confidentiality Committee is collaborating with the Japan putting into place structures that respond quickly in accordance with the laws and
regulations of each country.
Confidentiality Committee in responding to cyberattacks that have become
increasingly sophisticated and complex in recent years and is implementing
initiatives for strengthening information security.
Product Cybersecurity

Honda participates in the Automotive Information Sharing & Analysis Center

(Auto-ISAC), which has begun operations in Japan and the United States, for
sharing and analyzing information related to automotive cybersecurity. The Auto-
ISAC collects information on incidences detected within the industry.
Moreover, Honda obtains information on its own, including information on
relevant laws and specifications as well as industry standards.
By utilizing these initiatives in its own responses, Honda is proactively
promoting activities to ensure the safety and security of its products.

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6 Governance
Governance Data
Corporate Governance ･･････ 37
Compliance ･･･････････････ 45
Overview of corporate governance (as of June 19, 2020) Total amount of remuneration for Directors and Corporate Auditors
Form of organization Company with Audit and Supervisory Committee Total amount by type of Number
Risk Management ･･････････ 48 Total amount of
remunerations (millions of yen)
of eligible

Governance Data ･･･････････ 51 ● Number of Directors (excluding Audit and Supervisory Committee Members)..........................8 remuneration
Fixed
Performance-linked remuneration Directors
and bonuses remuneration (Number of
Number of Outside Directors........................................................................................... 2 Category of Directors Bonus Stock
(millions of yen) compensation persons)
Number of Specified Independent Directors.................................................................... 2 Directors
(excluding Directors who are Audit and
Number of Female Directors............................................................................................ 1 Supervisory Committee Members)
702 460 101 140 7
● Term of Directors (excluding Audit and Supervisory Committee Members)..............................1 (excluding Outside Directors)

● Number of Directors serving as Audit and Supervisory Committee Members............................5 Outside Directors
(excluding Directors who are Audit and 33 33 - - 3
Number of Outside Directors........................................................................................... 3 Supervisory Committee Members)
Number of Specified Independent Auditors..................................................................... 3 Directors
(Directors who are Audit and Supervisory
Number of Female Outside Directors.............................................................................. 1 Committee Members) (excluding Outside
143 143 - - 2
● Terms of Directors Serving as Audit and Supervisory Committee Members..............................2 Directors)

Outside Directors
(Directors who are Audit and Supervisory 50 50 - - 4
Committee Members)

Status of the meetings of the Board of Directors (FY2020) Total 930 689 101 140 16
● Number of meetings held (no. of times).................................................................................... 10 • Remuneration is limited to 1,160 JPY million per year for Directors (excluding Audit and Supervisory
Committee Members) and 270 JPY million per year for Directors (Audit and Supervisory Committee
● Attendance rate of Directors Members).
(excluding Directors who are Audit and Supervisory Committee Members) (%)...........................100 • These amounts indicate remuneration paid to Directors for the fiscal year ended March 31, 2020 and include
Attendance rate of Outside Directors (%)....................................................................100 remuneration paid to three Directors who ended their tenure as of the closing of the Ordinary General Meeting
of Shareholders held on June 19, 2019, comprising one Director who is neither an Audit and Supervisory
● Attendance rate of Directors who are Audit and Supervisory Committee Members (%).................100 Committee Member, one Outside Director who is not an Audit and Supervisory Committee Member, and one
Attendance rate of Outside Directors (%)....................................................................100 Outside Director (Audit and Supervisory Committee Member).
• Bonuses to Directors (excluding Audit and Supervisory Committee Members) are included in the
previously mentioned maximum amount for remuneration to Directors (excluding Audit and
Supervisory Committee Members), and the amount shown was decided by the meeting of the Board of Directors
held on May 12, 2020.
• The total amount of stock-based remuneration is the amount recorded as expenses related to the share
delivery points granted during the fiscal year ended March 31, 2020 in connection with the Directors’
Status of meetings of the Audit and Supervisory Committee (FY2020) remuneration BIP (Board Incentive Plan) trust.

● Number of meetings held (no. of times)....................................................................................... 8

Annual total remuneration and bonuses of highest-paid individual
● Attendance rate of Directors who are Audit and Supervisory Committee Members (%).................100 (President and Representative Director, Chief Executive Officer) (Japan)
Attendance rate of Outside Directors (%)....................................................................100
Annual total remuneration and bonuses of highest-paid individual
176
(President and Representative Director, Chief Executive Officer) (millions of yen)

Ratio to median annual total remuneration for all associates (%) 2,100

Rate of increase in annual total remuneration and bonuses of highest-paid

individual (President and Representative Director, Chief Executive Officer) (Japan)
Rate of increase in annual total remuneration and bonuses of highest-paid individual
101
(President and Representative Director, Chief Executive Officer) (%)

governance Honda Sustainability Report 2020 51

 1 2 3 4 5 6 7 8

6 Governance
Governance Data
Corporate Governance ･･ ･ ･ ･･ 37

Compliance ･･･････････････ 45
H o n d a T a x P o li c y
Risk Management ･･････････ 48

Governance Data ･･･････････ 51 1. Purpose of Policy （3）Transfer pricing

The Honda Tax Policy prescribes the basic stance and thinking regarding taxes for Honda shall establish proper pricing (Arm’s Length Price (ALP)) by giving
Honda Motor Co., Ltd. (hereafter HM) and its consolidated subsidiaries (HM and its sufficient consideration to transfer pricing taxation systems for transactions carried
consolidated subsidiaries collectively referred to as Honda). The Policy aims to out within Honda to ensure the proper payment of taxes corresponding to the value
contribute to society as well as maintain and increase corporate value by complying with created by business activities.
the tax laws and regulations of each country and region where Honda undertakes business （4） Ensuring transparency
activities and by making proper tax payments. Honda recognizes the importance of fulfilling accountability to tax authorities and
Tax systems of each country and region and international taxation rules are frequently other tax-related stakeholders through the timely and proper disclosure of tax-related
changed. In this environment, to ensure the proper undertaking of its business in a stable information and properly responds by disclosing tax-related information based on
manner Honda carries out accurate and high-quality tax affairs and responds to tax risks laws and regulations.
associated with its businesses in accordance with the Tax Policy described below. （5） Relationships with governments and tax authorities
Honda shall make efforts to ensure transparency and continuously build
2. Tax Policy relationships of trust through sincere responses to governments and tax
（1） Compliance authorities in the countries and regions where it does business by ensuring timely
Honda complies with laws, regulations and rules in countries and regions where it and proper provision of tax-related information based on laws and regulations
undertakes business, tax convention, international standards such as OECD and requests from governments and tax authorities.
guidelines, internal regulations that include tax-related regulations encompassing （6） Corporate governance
this Tax Policy adopted by Honda as well as Honda Corporate Governance (HCG), Honda strives to enhance corporate governance as one of the most important tasks for
and makes proper tax payments in line with the actual state of business. its management, based on the Company’s basic principle, in order to strengthen the
（2） Prohibition of tax avoidance trust of our shareholders/investors, customers and society; encourage timely,
Honda shall not engage in any transactions such as the use of tax havens aimed at tax decisive and risk-considered decision-making; seek sustainable growth and the
avoidance but make proper tax payments in line with the actual state of business in enhancement of corporate value over the mid- to long-term; and become “a company
keeping with the concept of “returning profits to the communities where profits are that society wants to exist.” In the same manner, Honda shall establish governance on
earned,” which has been Honda’s basic stance. taxation based on this concept, framework and management policy.

governance Honda Sustainability Report 2020 52