Announcement Regarding Analysis and Evaluation of Effectiveness of the Board of Directors

• Aiming to establish a proactive governance framework for leading the industry in enhancing long-term shareholder value under TDK’s growth strategies

May. 26, 2015

TDK Corporation hereby announces that it conducted a third-party evaluation of its Board of Directors, with the aim of raising the effectiveness of the Board and improving corporate value.
This evaluation conducted by outside consultants sought to determine the effectiveness of TDK’s Board of Directors as a whole, as well as the committees (Nomination Advisory Committee and Compensation Advisory Committee) attached to it, and each of the directors and company auditors. The consultants also analyzed the relative position of the framework to TDK’s Board of Directors by running a comparison of TDK’s basic corporate governance policies and principles with those set forth in the main governance codes of other companies and competitors from around the world.

An evaluation method was applied in which all directors and company auditors responded to a questionnaire concerning the effectiveness of TDK’s Board of Directors as a whole, and the constituent committees, directors, and company auditors. Based on the responses, the consultants held subsequent interviews exploring the fine details with each of the directors and company auditors.
A report based on the third-party evaluation conducted in line with the process and details above was then submitted to TDK’s Board of Directors. According to the report, the board members met to analyse and evaluate the effectiveness of the Board.

As a result, the board members were able to confirm that a framework for exercising management supervisory functions had been well established based on the scale, composition and operation of TDK’s Board of Directors, quality and characteristics of its members, and the status and condition of the committees. The members also confirmed that board deliberations were underpinned by a culture respecting open discussion, and that each director and company auditor was contributing to the board meetings by actively participating in deliberations.

On the other hand, it also became clear to the members that the Board of Directors needed to allot more time and build a discussion framework capable of deliberating the major risks and returns with regard to management issues and growth strategies from a medium- to long-term perspective. They saw this as relevant in the context of TDK having completed structural reforms, and that as it pursued growth strategies for accelerating business expansion and globalization, they had to establish a proactive governance structure capable of improving long-term shareholder value.
Going forward, TDK’s Board of Directors will hold ample discussions and move forward promptly with formulating and executing measures for responding to the findings of the analysis and evaluation above.

About TDK Corporation

TDK Corporation is a leading electronics company based in Tokyo, Japan. It was established in 1935 to commercialize ferrite, a key material in electronic and magnetic products. TDK's portfolio includes electronic components, modules and systems* marketed under the product brands TDK and EPCOS, power supplies, magnetic application products as well as energy devices, flash memory application devices, and others. TDK focuses on demanding markets in the areas of information and communication technology and consumer, automotive and industrial electronics. The company has a network of design and manufacturing locations and sales offices in Asia, Europe, and in North and South America. In fiscal 2015, TDK posted total sales of USD 9.0 billion and employed about 88,000 people worldwide.

• * The product portfolio includes ceramic, aluminum electrolytic and film capacitors, ferrites, inductors, high-frequency components such as surface acoustic wave (SAW) filter products and modules, piezo and protection components, and sensors.

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