Investor Relations Corporate Governance
Basic Policy on Corporate Governance
We believe that one of our priorities is facilitating prompt and appropriate decision making, enhancing supervision of business execution, ensuring compliance and increasing management transparency to achieve sustainable growth and enhance corporate value over the medium to long term under a basic management policy of continuing to develop together with society by promoting corporate activities in consideration of our social mission and pursing development of technologies to meet user needs and preservation of the environment globally. Based on this belief, we will enhance corporate governance.
Corporate Governance System
The Company has corporate auditors.
(1) Board of Directors
The Board of Directors consists of nine members including three Outside Directors: President and CEO Shigeki Miyachi, the Chairperson, Senior Managing Director Kazuhiko Tanaka, Managing Director Toshinao Kimura, Managing Director Koji Shimomura, Managing Director Toru Okajima, Director Shin Kasahara, Outside Director Yoichi Takei, Outside Director Satoshi Saito and Outside Director Nobuya Hideshima. To ensure the Directors’ efficient performance of their duties, the Board of Directors holds monthly regular meetings and extraordinary meetings as necessary to decide on matters stipulated by laws and regulations and important management matters and to supervise business execution.
(2) Board of Corporate Auditors
The Board of Corporate Auditors consists of four members including three Outside Corporate Auditors: Full-time Corporate Auditor Toshihiko Goto, Outside Corporate Auditor Taketo Nasu, Outside Corporate Auditor Kazuhiko Kimura and Outside Corporate Auditor Kazuhisa Hayashida. The Corporate Auditors attend meetings of the Board of Directors and other important management meetings. The Board of Corporate Auditors monitors and supervises management by reviewing important documents and exchanging opinions with the Directors. The Company has established an independent Internal Audit Office that checks execution of business operations. The Internal Audit Office holds regular meetings with the Corporate Auditors and reports the status and details of internal audits to the Corporate Auditors.
(3) Nomination and Compensation Advisory Committee
The Company has established an optional Nomination and Compensation Advisory Committee. The committee consists of four Directors: Outside Director Yoichi Takei, the Chairperson, Outside Director Satoshi Saito, Outside Director Nobuya Hideshima and President and CEO Shigeki Miyachi. Three of them are Outside Directors in accordance with the Nomination and Compensation Advisory Committee Regulations, which stipulate that Outside Directors shall constitute a majority of the committee members. As an optional advisory body for the Board of Directors, the committee deliberates on matters related to nominations and remunerations for Directors and Corporate Auditors, among other positions, in response to the Board of Directors’ requests and reports to the Board of Directors. The Board of Directors deliberates on the matters based on the committee’s reports and passes resolutions.
(4) Other Bodies
In addition to the above, the Management Committee holds weekly meetings, in principle. The committee consists of President and CEO Shigeki Miyachi, the Chairperson, Senior Managing Director Kazuhiko Tanaka, Managing Director Toshinao Kimura, Managing Director Koji Shimomura, Managing Director Toru Okajima and Director Shin Kasahara. The Management Committee checks on the progress against targets and for solutions to issues for prompt management decision making and business execution. The Company has introduced an executive officer system to strengthen the business execution system and expedite business execution. The officers responsible for business divisions make decisions on concrete initiatives in business divisions based on decisions on important management matters made by the abovementioned meeting and execute the initiatives.
Audits by Corporate Auditors
The Board of Corporate Auditors consists of a full-time Corporate Auditor and three Outside Corporate Auditors. They attend Board of Directors meetings and other important management meetings. The Board of Corporate Auditors formulates a plan for audits by Corporate Auditors for each fiscal year and monitors and supervises management by reviewing important documents, exchanging opinions with the President and CEO, and visiting major offices and carrying out audits.
Full-time Corporate Auditor Toshihiko Goto and Outside Corporate Auditor Kazuhiko Kimura have worked for financial institutions for many years and have considerable knowledge about finance and accounting.
Outside Corporate Auditor Kazuhisa Hayashida is a certified public accountant and has considerable knowledge about finance and accounting.
In the fiscal year under review, the Company held 14 meetings of the Board of Corporate Auditors. The attendance of each corporate auditor was as follows:
Toshihiko Goto attended 14 meetings. Taketo Nasu attended 14 meetings. Kazuhiko Kimura attended 14 meetings. Kazuhisa Hayashida attended 14 meetings.
Major agenda items of Board of Corporate Auditors meetings are the formulation of audit policies and audit plans, the sharing of the results of audits of the performance of the Directors, audits of subsidiaries and other information, the appropriateness of the method and results of the accounting auditor’s audit, the exchange of opinions based on interim reports from the accounting auditor and discussion on matters related to accounting procedures.
The main activities of the full-time Corporate Auditor are the formulation of a basic audit plan for each fiscal year, visiting and auditing based on the basic audit plan, reviewing related documents, holding regular discussions on audit status with persons in charge of internal audits and the sharing of audit results with the Outside Corporate Auditors at Board of Corporate Auditors meeting. The full-time Corporate Auditor received reports from the accounting auditor about its execution of duties and requested explanations as needed to ensure proper auditing.
The Company has the Internal Audit Office (five members) as an internal audit division. The Internal Audit Office formulates internal audit plans under the Internal Audit Regulations and conducts internal audits on the execution of operations and management in each division of the Group. It points out issues and makes recommendations as necessary. The Internal Audit Office regularly reports audit results to the Directors and Corporate Auditors.
The Company has three Outside Directors and three Outside Corporate Auditors.
Outside officers are expected to provide managerial advice and supervisory functions to the directors from an objective and expert standpoint, and to act on the basic principle of ensuring that there will be no conflicts of interest with general shareholders. The outside officers are considered independent if they or their relatives (within the second degree of kinship) have not fallen under the following items in the past 10 years.
- Executives at the Company, its affiliates, major shareholders, major business partners, or companies for which the Company is a major partner
- Non-executive directors or accounting advisors at the Company’s affiliates
- Consultants, accounting experts or legal experts who receive significant amounts of cash or other property other than executive compensation from the Company
- Directors or other executives at organizations that receive donations or financial support exceeding a certain amount from the Company or its affiliates