Corporate Governance
Basic approach on corporate governance
As a prerequisite for the Company's corporate activities, the Company will build smooth relationships with itsstakeholders, including "customers and other business partners," "employees" and "community." The Company will also ensure soundness, transparency and efficiency in building such relationships.
Based on these activities, the Company aims to increase profits and continuously increase corporate value, and to fulfillits responsibilities to stakeholders, including ensuring the rights of shareholders, as well as its accountability to them. To this end, the Company will continuously improve and maintain the internal control framework governing corporateactivities, such as the management structure, management organization and management system that supporttransparent, fair, prompt and decisive decision-making and execution of business.
Outline of Corporate Governance Structure
The Company has adopted an executive officer system as a company with the Board of Directors and Audit & SupervisoryBoard Members in order to enhance group management through prompt decision making, clarification of managementand execution and interaction between management and execution in response to changes in the business environmentsurrounding the Group.
Board of Directors
The Board of Directors consists of 6 Directors and serves for a term of 1 year. The Board of Directors deliberates and makes decisions on important management matters and supervises the execution of duties by each Director inaccordance with laws and regulations, the Articles of Incorporation and the Board of Directors Regulations, etc. In addition to the Company has also establishedmeeting organs such as the Management Committee, Sales Division DirectorsCommittee, Division Directors Committee and the Sustainability Committee to enhance deliberations and discussions on important issues, as well as to discuss, monitor, and shareinformation on important issues from various perspectives through various cross-organizational meetings such as theGeneral Managers Committee and the Sales Information Committee. In principle, the Board of Directors meets once a month, and as needed.
Audit & Supervisory Board Member
3 the Audit & Supervisory Board Members are elected for a term of 4 years. The Audit & Supervisory Board Members supervises the execution of duties by the Directors from a standpointindependent of the Board of Directors. The Company also ensure a system whereby each Audit & Supervisory Board Member can understand the deliberation process of resolutions and reports by the Board of Directors. Each Audit &Supervisory Board Member makes necessary statements as needed to provide advice and recommendations to ensure thereasonableness and appropriateness of the Directors' decision making and execution of their duties.
Executive Officers
Executive officers assist the representative directors in the execution of their duties by executing the duties delegated to them by the representative directors and directing and supervising the departments in charge, in accordance with the management policy decided by the Board of Directors. A part of officers including those in charge of domestic subsidiaries and major overseas subsidiariesalso concurrently serve as Executive Officers of the Company or senior employees of the Company.
Various Committee
Management Committee
The Company has adopted an executive officer system to separate the roles of management oversight and business execution functions. A part of officers including those in charge of domestic subsidiaries and major overseas subsidiaries also concurrently serve as Executive Officers of the Company or senior employees of the Company.
Sales Division Directors Committee
Consisted of Chief Executive Officer and Chairman of the Board, sales and development Executive Officers and DivisionDirectors, the committee meets once a month to share the status of sales and development.
Division Directors Committee
Consisted of Chief Executive Officer and Chairman of the Board, all Executive Officers and Division Directors, thecommittee meets once a month to monitor the status of business execution by the Division Director and the status ofactivities of the entire Group and to identify and share issues on a monthly basis.
Division Directors committee
Consisted of Chief Executive Officer and Chairman of the Board, all Executive Officers and Division Directors, the committee meets once a month to monitor the status of business execution by the Division Director and the status of activities of the entire Group and to identify and share issues on a monthly basis.
Sustainability Committee
The committee is consisted of Chief Executive Officer and Chairman of the Board, Executive Directors, Director ofCorporate Division, Executive Officers (Development), etc. Based on the basic policy on sustainability, the committeemeets as appropriate to further strengthen the promotion activities.
Internal Audit Office
The Internal Audit Office conducts audits based on an annual internal audit plan. The results of these audits are reported directly to directors and corporate auditors, as appropriate, at general managers' meetings and board of directors meetings. The results of the audits, including any minor issues, are simultaneously communicated through management and senior managers to the general managers of the relevant audited departments, who are instructed to make improvements and to take immediate action to remedy the situation. The Internal Audit Office also works closely with the accounting auditors and corporate auditors by exchanging opinions on the status of internal controls.
Other Matters Related to Corporate Governance
Compliance Structure
"The Management Committee" that oversees compliance builds and operates a compliance promotion system. The General Affairs & Compliance Promotion Department, serving as Secretariat, carries out in-house awareness raising and education on compliance overall, and issues alerts, notices, and notifications to all Group employees and related parties as required. Within the compliance regulations set by the company, we also include the blocking of relationships with antisocial forces as an item in the Code of Business Practice.
The Company has established a whistle-blowing system based on the Whistleblower Protection Act, the details of which are stipulated in the Compliance Regulations, etc. When a whistle-blower reports to the inside or outside contact point, the whistle-blower is not treated unfairly, but the the Compliance Secretariat or Audit & Supervisory Board Members (Full-time), as appropriate, reports the matter to the Management Committee. The existence or non-existence of such reports is reported to the "Management Committee" every month.
Internal Control over Financial Reporting
The Company has established and is operating internal control rules for financial reporting. The committee then convenes the "Internal Control Management Committee," which discusses and examines issues related to business operations of the entire Group and the results of general control audits conducted by the Internal Audit Office, to ensure the adequacy and reliability of financial reporting.
Risk Management Structure
The Company has established and is operating a Risk Management Regulation. The "Risk Analysis conference" is held to analyze the risks surrounding the Company and its group companies and to verify the degree of impact on management, and reports are made at the "Management Committee" and to the accounting auditor. In addition, in order to minimize losses or disadvantages incurred by the Company and its group companies, the Company has established Business Continuity Management (BCM) and Business Continuity Plan (BCP), which stipulate the criteria for establishing a task force and emergency responses, and reviews them as necessary.
Status of System to Ensure Appropriateness of Operations of the Group Companies
In order to establish, maintain, and operate a system to ensure the appropriateness of business operations of each company in the group, issues to be addressed by each company are identified and discussed at the "Division Directors Committee" and the "Sales Division Directors Committee" through reports on the management situation of each company and the results of internal audits. In resolving and improving these issues, the staff of each corporate department provides advice and support as appropriate.