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Message from the Chairman of the Board of Directors

Chairman of the Board of Directors Hiroko Ota

As a front–runner in the area of corporate governance, Mizuho is aiming to increase its corporate value through pursuing "growth–oriented" governance reforms designed to foster "earning potential."

How the Board of Directors Meetings Are Operated

Mizuho began the full–scale corporate governance reforms in fiscal 2014 and for the past three years, MHFG's internal and outside directors have worked together with strong resolve to implement governance reform. The group is steadily changing. In fiscal 2016, the Board of Directors held 13 meetings in total and held comprehensive discussions on strengthening the group's profitability, such as clarification of its business portfolio, cost structure reform, and branch strategy, while adopting diverse perspectives of outside directors.

As the Chairman of the Board of Directors

The biggest role of the Chairman of the Board of Directors is to make discussions livelier and more productive at the meetings. It is necessary to narrow down the matters to be discussed to ensure that enough time can be devoted to the items on the agenda, and clarify the issues to be discussed on the matters to ensure substantive discussions. To do this, it is also necessary to make sure that concise and well–prepared materials are submitted, and I work with the Corporate Secretariat to prepare these documents in advance.

I feel it is important for effective governance that an outside director serves as Chairman of the Board. I set the agenda from an outsider's perspective, and this makes it possible to conduct persuasive discussions. On the other hand, it is important that company information is properly communicated to the outside directors. Unless information is shared with outside directors, the directors cannot perform their role properly. Mizuho supports this through the Corporate Secretariat, a specialized department that maintains close contact with outside directors. Going forward, I will work together with the Board members to make the Board of Directors what it aims to be.

Issues to Be Addressed Going Forward

The essential issue for Mizuho going forward is strengthening profitability. Our governance reforms can be said to have been successful only when we achieve a substantial increase in profitability. While we are taking steps for clarification of the business portfolio and branch strategies, more thorough implementation of productivity improvements, and cost structure reforms are necessary. In addition, the human resource management reform that we are currently undertaking is one of our most important challenges. Under the group's traditional human resource management, personnel are selected according to the year–group of entering the company based on the evaluations they have accumulated since joining the organization, and there are concerns that personnel may be marked down disproportionately for the mistakes they have made. It will take time to implement these changes, which aim to break away from the seniority and point–deduction system, and allow all employees to demonstrate their ability. However, I believe that such efforts will deeply instill governance reform throughout the group, and make Mizuho a strong organization where its members communicate openly and vigorously to create value.

Fiscal 2017 is the second year of the medium–term business plan. The results of the introduction of the in–house company system will be evaluated this year. I would like to operate the Board of Directors in a manner in which outside directors and management will share a sense of crisis and expeditiousness.