Notice of Revised Compensation Scheme for the Company’s Executive Officers

Mitsubishi Electric Corporation (TOKYO Prime Market: 6503) announced today that the Compensation Committee, at its meeting held on May 25, 2022, decided to revise the compensation scheme for the Company’s Executive Officers and to apply the revised scheme from fiscal 2023, as follows:

1. Purpose of the Revision

The Company has introduced a performance-based compensation scheme, including stock compensation, for its Executive Officers to increase their awareness of the necessity to contribute to enhancing the medium- to long-term corporate value of the Group and to share that value with shareholders. However, we have decided to revise the entire compensation structure for our Executive Officers effective from the fiscal year 2023 to further clarify the roles and responsibilities of Directors and Executive Officers and to more rigorously evaluate their short-, medium-, and long-term incentive compensation based on the achievement level of the performance indices.

The key points of the new compensation scheme for the Company’s Executive Officers are as follows:

• Revised its compensation scheme to make it more performance-linked to implement and achieve the key indicators and priority measures outlined in the Medium-Term Management Plan.
• In addition to rigorously evaluating the achievement of the performance indices in the business units in charge, greater emphasis on incentive compensation to reflect performance indices in non-financial matters, such as restoring public trust, improving employee engagement, and sustainability and ESG-related progresses.
• Revised the stock compensation portion of the compensation scheme and established new stock ownership guidelines to strengthen incentives to sustainably increase corporate value and shareholder value over the medium- to long-term.
• Improved compensation governance by introducing malus and clawback provisions.

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