FRONTEO Inc. Corporate Governance Basic Policy
Chapter 1 FRONTEO Philosophy
Bright Value Creator
As a Bright Value Creator, FRONTEO creates shining value for the future of people and advanced science.
・ Bright Idea Aiming for a good philosophy, always new ideas ・ Bright Humanity Human first business ・ Bright Business Value-creating business that nurtures companies and people ・ Bright Technology Innovative technology for human society ・ Bright Service Bring your customers to life ・ Bright Culture A culture that continues to shine over time
Chapter 2 Basic Concept of Corporate Governance
Up until now, we have set the corporate philosophy of "creating the future of society through the information analysis business," and have provided support aimed at reducing the legal risk of our customers in businesses such as litigation support and fraud investigation. ..In particular, regarding the maintenance and improvement of corporate value of Asian companies, we believe that we have received a certain reputation as a pioneer in the industry through the establishment of a local support system and research and development of Asian language analysis technology.
Currently, as a Bright Value Creator, the Group is working to solve new social issues by utilizing its unique artificial intelligence technology cultivated through information analysis in the legal field.Our artificial intelligence "KIBIT" that understands human tacit knowledge replaces many tasks that required human judgment, and from big data to humans and advanced science, which has become difficult due to the increase in data volume. It enables the creation of value for the future of.We will contribute to the realization of a prosperous society in various fields and carry out activities based on our own corporate value maintenance and improvement so that we can be trusted by our stakeholders.
We believe that it is essential to enhance internal control by establishing corporate governance in order to continuously increase corporate value in the information industry, where the market environment is changing rapidly.In order to realize the continuous improvement of corporate value, which is the basic policy, we will establish a management system that ensures transparency and soundness, close communication with stakeholders, and adhere to compliance within our expanding company. Work on.Together with our stakeholders, we will continue to take on challenges in various fields in order to contribute to the creation of the future of society, and at the same time, we will develop and expand the organizational structure necessary for that purpose.
Chapter 3 Relationships with Stakeholders
Message from CEO and Chairman of the Board
Since listing on the TSE Mothers (currently TSE Growth) in 2007, we have endeavored to expedite information disclosure and create dialogue opportunities in order to promptly inform you of information that could cause major changes in the business environment. rice field.We believe that we have been able to accumulate achievements in the legal field, which is an existing business domain, by making the best use of the opinions of all of you.
Going forward, we will continue to expand into new fields in addition to existing fields with the idea of "Bright Idea, aiming for an excellent philosophy and always keeping new ideas."We recognize that it is essential for stakeholders to be actively involved in order to further expand each business domain.By building the relationships necessary for that purpose and implementing measures, we will work together with you to achieve continuous improvement in corporate value and build a "Bright Culture that continues to shine beyond the times." .
1. Relationship with shareholders, etc.
(1) General meeting of shareholders
- Positioning the General Meeting of Shareholders as the highest decision-making body, we will secure a sufficient period for exercising shareholders' rights and create an environment in which shareholders can exercise their rights appropriately.
- We will endeavor to send the convocation notice at least three weeks before the date of the general meeting of shareholders.
- Prior to sending the convocation notice, the Japanese and English versions will be posted on our website.
- We will introduce electronic exercise via the Internet to ensure the convenience of exercising voting rights of shareholders.
- If an institutional investor, etc., who holds shares in the name of a trust bank, etc. wishes to exercise shareholder rights such as exercising voting rights in advance at a general meeting of shareholders, it will consult with the trust bank, etc.In addition, if institutional investors wish to hear at the general meeting of shareholders, they will be allowed to enter and hear at the general meeting of shareholders after completing the prescribed procedures in advance.
(2) Ensuring the rights of shareholders
- In order to specifically grasp the intentions of shareholders at the general meeting of shareholders and reflect them in management and dialogue with shareholders, we will analyze the pros and cons of all proposals after the general meeting of shareholders and consider whether or not to respond.
- The Board of Directors makes decisions on important management matters, enabling flexible decision-making, aiming to increase corporate value and return appropriate profits to shareholders.
- In consideration of the rights of minority shareholders, if minority shareholders exercise their rights against the Company or its officers, the Company will comply with the law and will not prevent the exercise of the rights of the shareholders.
(3) Constructive dialogue with shareholders
- In order to contribute to sustainable growth and increase corporate value, we will establish a "basic policy on dialogue with shareholders" and promote constructive dialogue.
(4) Basic policy of capital policy
- Aiming for sustainable improvement of corporate value, based on maintaining a sufficient level of shareholders'equity necessary to quickly and reliably seize expanding business opportunities, financial soundness, shareholders' equity efficiency and shareholder returns We aim to optimize.As a shareholder return policy, we will determine the dividend amount while taking into consideration the future capital investment of the Company and the demand for funds such as R & D expenses.
- When raising capital that results in large-scale dilution, the Board of Directors will make a resolution after thorough deliberation in consideration of the details of the use of funds, recovery plan, and market environment.
(5) Policy on strategically held shares
- In order to continuously improve corporate value, we will collaborate to further improve social value and hold shares for the purpose of more stable corporate management.
- The Board of Directors will examine the purpose and rationality of holding strategically held shares from a medium- to long-term perspective based on their returns and risks, and reflect this.
- We will determine the exercise of voting rights for strategically held shares from the perspective of improving the corporate value of investee companies over the medium to long term.
(6) Takeover defense measures
- We do not implement takeover defense measures.
- The Board of Directors will take the following actions when the shares are tendered.
- We request the Tender Offerors, etc. to explain the measures to improve the corporate value of the Group.
- After the Board of Directors considers measures to further improve corporate value as the Group, we will express our thoughts to shareholders.
(7) Prevention of transactions between related parties
- Regarding transactions with directors, corporate auditors and their close relatives, we will prepare a confirmation of the investigation regarding the existence of transactions and report any important facts to the Board of Directors.
- We will disclose the transactions of related parties in accordance with the Companies Act, the Financial Instruments and Exchange Act and other applicable laws and regulations, and the rules established by the Tokyo Stock Exchange.
(8) Medium-term management plan
- Regarding the fields related to litigation support and fraud investigation, which are our existing businesses, we will set and announce medium-term performance targets.On the other hand, in the new business field using artificial intelligence "KIBIT", the market size and demand are unknown, and the industry environment may fluctuate rapidly, so we have announced the medium-term management plan for our entire business. However, the Board of Directors sets medium-term performance targets for both existing and new businesses, confirms and analyzes the progress, and reviews them as appropriate.
2. Relationship with customers
- Based on our corporate philosophy of "Bright Service to shine our customers," we aim to achieve high product quality and prompt service, and improve customer satisfaction.
3. Relationship with business partners
- We will strive to build mutual cooperation and relationships of trust by complying with applicable laws and regulations and conducting fair transactions based on corporate ethics.
4. Relationship with society
- Based on our management philosophy, "Bright Technology, Innovative Technology for Human Society," we believe that it is our mission to contribute to the sustainable development of society by solving social issues through technology, and to realize a better society.
5. Relationship with employees
- We believe that securing diverse human resources regardless of gender, age, nationality, etc. is important for fulfilling our social responsibilities as a company and achieving sustainable growth.
- In particular, regarding the employment of women, as of July 2016, the ratio of employees is 7% in Japan and 5% globally, and it is indispensable to promote the active participation of women.Therefore, from the perspective of "balancing work and life," we revised the reduced working hours system in 4.We will continue to strive to improve the working environment, such as enhancing the system, and to promote female managers.
- Our management philosophy is "Bright Humanity, a human-first business" and "Bright Business, a value-creating business that nurtures companies and people." We respect each and every employee and share diverse values and ideas. We aim to be a company where the employees who have it can fully demonstrate their abilities and specialties and play an active role.
- We believe that the growth of our employees directly leads to our growth.We will endeavor to create an environment in which the growth of employees and the improvement of corporate profits grow in proportion.
- We will endeavor to enhance our personnel system, education and training so that our employees can develop, improve and demonstrate their abilities.
- We will endeavor to provide a place where employees can demonstrate their abilities and motivation and play an active role globally.
- We will comply with labor-related laws and regulations, eliminate acts that place an excessive physical and mental burden on employees, work long hours, and work overtime, and strive to ensure a safe and comfortable work environment that takes health into consideration.
- We will set up a whistleblower window independent of management, accept reports on acts that violate or may violate work rules and regulations, keep the content of the report confidential, and do not treat the whistleblower unfavorably. At the same time, we will strive to resolve issues at an early stage.
Chapter 4 Enhancement of Information Disclosure
1. Information Disclosure Criteria
- By establishing information disclosure rules, we aim to realize highly transparent management, and actively disclose useful information that is appropriate, specific to stakeholders, and has high added value.
- Information that should be financed and disclosed in compliance with the Company's information disclosure rules, related laws and regulations, and the rules established by the Tokyo Stock Exchange (hereinafter referred to as "decree / rules") in order to meet the needs of information disclosure from shareholders and other stakeholders Will be disclosed in a timely and appropriate manner.
- We will endeavor to proactively disclose information that is not stipulated by laws and regulations, but that is useful for understanding our business situation and management strategy.
Chapter 5 Corporate Governance System
Message from CEO and Chairman of the Board
We are currently accelerating business development in new fields such as medical care, marketing, and business intelligence, in addition to the existing legal field, as a business that utilizes artificial intelligence "KIBIT", which is our unique technology. With the establishment of new subsidiaries in medical care and marketing in 2015, it will be necessary to respond to changes in the business environment in multiple businesses in the future.
Management through the management of higher quality boards of directors and corporate auditors so that we can make objective decisions and realize flexible and efficient management even when such significant changes in the external environment are expected. We will endeavor to build a system to promptly implement appropriate management measures while minimizing risks.
1. Engine design
Immediately after listing on the Tokyo Stock Exchange, the Board of Directors of the Company is composed of executive directors and multiple outside directors (including independent outside directors, the same shall apply hereinafter), which ensures fairness and transparency of management. We have endeavored to secure it.Therefore, as an institutional design under the Companies Act, we will continue to select companies with a board of auditors, and continue to supervise management by both the board of directors and the board of auditors to ensure fairness and transparency.
2. Board of directors
(1) Roles and responsibilities of the Board of Directors
- The Board of Directors of the Company is responsible for formulating and revising the Company's philosophy, instilling the Company's philosophy widely among employees of the Group in Japan and overseas, and as appropriate, the Company's philosophy is always respected by the Group. We are responsible for verifying that it is a code of conduct for our employees.
- Recognizing that the Company is a global company with subsidiaries in Japan and overseas, the Board of Directors of the Company manages the subsidiaries of the Company legally and appropriately, and shares management-related matters with the Company. We are responsible for building a system and continuously enhancing and strengthening that system.
- The Board of Directors of the Company recognizes that it is the main role and responsibility to set the strategic direction of the Company as the final decision-making body regarding the execution of important business of the Company, and fully fulfills its accountability to stakeholders. To this end, we will conduct constructive and fair deliberation on specific management strategies and plans, and make decisions based on strategic directions.
- The Board of Directors of the Company regards creating an environment that supports appropriate risk taking by the Executive Directors as one of its main roles and responsibilities, and welcomes proposals from the Executive Directors based on a sound entrepreneurial spirit. At the same time, in order to ensure accountability, we will conduct a multifaceted and thorough examination of such proposals from an independent and objective standpoint, and when the approved proposals are implemented, the executive director's prompt and decisive intentions. Respect the decision.
- The Board of Directors of the Company delegates to the President and Representative Director of the Company the execution of matters approved by the Board of Directors as important business executions of the Company and other matters that occur in daily operations.Based on the delegation of the Board of Directors of the Company, the President and Representative Director delegates to the approver who is stipulated in the Approval Authority Regulations according to the magnitude of the risk of the matter and executes the business.
- The Company has adopted an executive officer system in order to enhance and improve the efficiency of the business execution system of directors.Executive officers who directly direct and supervise the Group's domestic and overseas companies and departments are appointed by the Board of Directors and carry out the responsibilities set by the Board of Directors.When the Board of Directors of the Company receives a recommendation from the President and Representative Director and appoints executive officers and nominates candidates for directors and corporate auditors, the total size of the Company and its subsidiaries is XNUMX to XNUMX directors. Within the range of XNUMX to XNUMX executive officers, while emphasizing the expertise, experience, and abilities of the recommended person, comprehensive judgment is made in consideration of personality, personality, legal compliance, moral awareness, ethics, etc. , Determine in a way that balances diversity and appropriate scale.When making a decision, the Target Company may be required to attend the Board of Directors.
- The Board of Directors of the Company appropriately evaluates the performance of the Company, deliberates the evaluation at the Board of Directors, etc., and appoints and dismisses executive directors and executive officers in a fair and transparent procedure. It will be reflected in the personnel affairs of.
- The Board of Directors of the Company will explain the reasons for nominating directors and corporate auditors in the business report.
- The Board of Directors of the Company entrusts the determination of remuneration for each director to the President and Representative Director, and does not introduce performance-linked remuneration or grant treasury stock, but to prevent it from becoming a stake. In addition, when an outside director, full-time corporate auditor or board of corporate auditors points out or advises that the remuneration is inappropriate, we have established a system to review the remuneration at any time based on the advice or advice.
- The Board of Directors of the Company will ensure a response system when a problem is pointed out by an Audit & Supervisory Board Member or an Accounting Auditor.
- The Board of Directors of the Company pays close attention to the development of human resources of the Company and the development of future executives, and appropriately supervises them through interviews with personnel personnel.
(2) Composition of the board of directors
- The Board of Directors of the Company is composed of one or more executive directors and multiple outside directors, considering that the Board of Directors is the oversight of management and the decision-making body for final decisions.
(3) Chairman of the Board of Directors
- The Chairman of the Board of Directors of the Company will be the President and Representative Director to clarify management responsibilities.
- The Chairman of the Board of Directors of the Company recognizes that the Board of Directors is an organization that supervises management, and will manage the proceedings fairly, giving due consideration to the free and open disclosure of opinions at the Board of Directors.
(4) Internal control
- The Board of Directors of the Company has established the "Basic Policy on the Development of Internal Control Systems" in order to ensure the prompt execution of business under appropriate control, and as a global company, the development of the Company and its subsidiaries in Japan and overseas. Oversee the situation and operational status.
- The Board of Directors of the Company regularly requests reports on risk recognition and response to risks from the “Risk Management Committee” established regarding risk management.
- The Board of Directors of the Company requests the Internal Audit Office to confirm the status of compliance and report the results of audits regarding the "Compliance Manual" established regarding compliance.
- The Board of Directors of the Company requests reports on the evaluation of the maintenance and operation of internal controls conducted by the Internal Audit Office based on the "Basic Policy on Internal Controls Related to Financial Reporting," which stipulates the appropriateness of financial reporting.
(5) Relationship with the accounting auditor
- The Board of Directors of the Company will ensure that accounting auditors can carry out sufficient and appropriate audits in order to carry out high-quality audits.
- The Board of Directors of the Company will ensure a response system when the accounting auditor discovers fraud and requests an appropriate response, or points out deficiencies or problems.
- The Board of Directors of the Company will hold interviews with the Accounting Auditor, the President of the Company and the Chief Financial Officer (CFO) as appropriate.
- The Board of Directors of the Company establishes a system that allows accounting auditors to access corporate auditors, internal audit departments and outside directors.
(6) Implementation and disclosure of effectiveness analysis and evaluation of the Board of Directors
- The Board of Directors of the Company, including outside directors and outside corporate auditors, makes important management decisions through lively discussions and deliberations, and strives to be effective.Disclosure of the results of analysis and evaluation of the effectiveness of the entire Board of Directors will be considered as necessary in the future.
3. Board of Corporate Auditors
(1) Roles and responsibilities of the Board of Corporate Auditors
- The Board of Auditors of the Company shall supervise overall management from shareholders and other stakeholders in fulfilling roles such as auditing the execution of duties by directors, appointing and dismissing external accounting auditors, and exercising authority over audit fees. We are strongly aware that we have been entrusted with the audit and are responsible for making appropriate decisions from an independent and objective standpoint.
- The Board of Corporate Auditors of the Company will endeavor to establish a system to ensure the effectiveness of audits.
- The Board of Corporate Auditors of the Company will endeavor to improve the effectiveness of audits by exchanging opinions and information as appropriate in cooperation with the Internal Audit Office.
- The Board of Corporate Auditors of the Company provides outside directors with information obtained through audit activities.
- The Board of Corporate Auditors of the Company decides the remuneration of Audit & Supervisory Board Members by consultation within the total amount of remuneration, etc. of all Audit & Supervisory Board Members determined by the resolution of the General Meeting of Shareholders.
(2) Chairman of the Board of Corporate Auditors
- The Board of Corporate Auditors of the Company appoints a chairman from among the full-time corporate auditors by its resolution.
- The Chairman of the Board of Corporate Auditors performs the duties commissioned by the Board of Corporate Auditors.
- The Chairman of the Board of Corporate Auditors does not interfere with the exercise of authority of each Corporate Auditor for any reason.
(3) Relationship with the accounting auditor
- The Board of Corporate Auditors of the Company will ensure a system that enables accounting auditors to carry out sufficient and appropriate audits in order to carry out high-quality audits.
- The Board of Corporate Auditors of the Company formulates evaluation criteria and appointment criteria for the proper evaluation of accounting auditors, and confirms their independence and expertise.
- The Board of Auditors of the Company asks the Accounting Auditor to explain whether the Accounting Auditor complies with the quality control standards necessary for conducting proper accounting audits.
- The Board of Corporate Auditors of the Company will ensure a response system when the accounting auditor discovers fraud and requests an appropriate response, or points out deficiencies or problems.
- The Board of Corporate Auditors of the Company will hold interviews with the Accounting Auditor, the President of the Company and the Chief Financial Officer (CFO) as appropriate.
- The Board of Corporate Auditors of the Company holds regular meetings with accounting auditors.
(4) Relationship with the Internal Audit Office
- The Board of Corporate Auditors of the Company holds regular meetings with the Internal Audit Office.
- The Board of Corporate Auditors of the Company requests reports on the results of internal audits conducted by the Internal Audit Office, the results of internal control evaluations, and the status of internal reports.
4. Accounting Auditor
(1) Roles and responsibilities of the accounting auditor
- Our accounting auditors recognize that we have a responsibility to our shareholders and investors, and take appropriate measures to ensure proper audits.
- Our accounting auditors play an important role in ensuring the reliability of disclosed information and are responsible to our shareholders.
- The Accounting Auditor of the Company cooperates with the Board of Corporate Auditors and the Internal Audit Office to ensure a system that enables proper audits.
- Our accounting auditors ensure independence and expertise.
- Our accounting auditors comply with the quality control standards necessary for proper accounting audits.
- Our accounting auditors take steps to prevent certain executives from being involved in our accounting audits for more than a certain period of time.
5. Directors and Audit & Supervisory Board Members
(1) Executive Director
- As a member of the Board of Directors of the Company, the Executive Directors of the Company understand the responsibilities of the Board of Directors of the Company, ensure appropriate collaboration with stakeholders, and serve as directors for the common benefit of the Company and shareholders. Perform the duties of.
- Our executive directors always practice our philosophy and motto, have a high level of legal compliance, morality, and ethics, and execute our business without forgetting a fair and bird's-eye view.
- Our executive directors do not neglect to collect information necessary for business execution.
- The Executive Directors of the Company recognize that the announced earnings forecast is one of their commitments to shareholders, and will make every effort to realize it.If the target is not achieved, we will fully analyze the cause and the details of the measures taken by the Company, explain it to the shareholders, and reflect the analysis in the plan after the period.
- Our executive directors always strive for self-improvement in order to properly fulfill their roles and responsibilities.
(2) Outside director
- As a member of the Board of Directors of the Company, the outside directors of the Company supervise the execution of business by the executive directors, and while ensuring appropriate cooperation with stakeholders, for the benefit of the Company and shareholders. From the perspective of promoting sustainable growth of the company and improving corporate value over the medium to long term based on its own knowledge of management policies and management improvements, the intentions of the executive directors, the board of directors and stakeholders It is responsible for reflecting the appearance in the proceedings of the board of directors.
- Our outside directors exchange information about our management by holding regular meetings with other outside directors and the Board of Auditors.
- Our outside directors may request us to provide information at any time as necessary to fulfill our responsibilities.
- The criteria for determining the independence of independent outside directors are based on the criteria set by the Tokyo Stock Exchange.
- Our outside directors always strive for self-improvement in order to properly fulfill their roles and responsibilities.
(3) Audit & Supervisory Board Member
- As a member of the Board of Corporate Auditors of the Company, the Audit & Supervisory Board Members of the Company understand the responsibilities of the Board of Corporate Auditors of the Company, ensure appropriate cooperation with stakeholders, and audit for the common interests of the Company and shareholders. Performs duties as a role.
- Our corporate auditors have the specialized knowledge of law, finance and accounting, management, etc. required as corporate auditors, and also have a high sense of legal compliance, moral awareness, and ethics, and have a fair and bird's-eye view. Do your business without forgetting.
- The Audit & Supervisory Board Members of the Company conduct business audits and accounting audits in accordance with laws and regulations, actively and proactively exercise their authority to fulfill their roles, and express their opinions at the Board of Directors or to individual directors.
- Corporate auditors of the Company conduct legality audits and validity audits of the performance of duties by directors and the performance of supervisory obligations by the Board of Directors.
- Corporate auditors of the Company audit the performance of duties by directors, appoint and dismiss accounting auditors, and exercise authority related to audit fees.
- Our corporate auditors monitor and verify the decision-making of the Board of Directors and the construction and operation of the internal control system.
- Our corporate auditors always strive for self-improvement in order to properly fulfill their roles and responsibilities.
(4) Full-time Audit & Supervisory Board Member
- Among the corporate auditors of the Company, full-time corporate auditors actively strive to improve the audit environment, including exercising investigative authority based on laws and regulations, based on their characteristics as full-time employees, and are important within the company such as the management meeting. We will endeavor to collect in-house information by attending various meetings and visiting domestic and overseas companies.
- Our full-time corporate auditors share the information they have learned in performing their duties with other corporate auditors.
(5) Outside Audit & Supervisory Board Member
- Of the Audit & Supervisory Board Members of the Company, the Outside Audit & Supervisory Board Members have a relatively high degree of independence, so they give a fairer and more appropriate opinion to the Board of Directors.
- Our outside corporate auditors independently exercise their authority to investigate in accordance with laws and regulations and strive to collect information within the company.
(6) Support system
- The Company has established the Board of Directors Secretariat and operates as follows so that directors and corporate auditors can have sufficient discussions at the Board of Directors.
- Regarding the meeting of the Board of Directors, we will create an annual meeting schedule before the start of the fiscal year to ensure that it is easy to attend the Board of Directors.
- We will prepare appropriate materials and equipment so that the Board of Directors can have sufficient discussions.
- If the resolution is the approval of a significant amount of documents, we will distribute the materials on the agenda at least a considerable number of days before the date of the Board of Directors.
- Not limited to the above, the Board of Directors Secretariat will provide information necessary for directors and corporate auditors to make decisions as appropriate.
- When directors and corporate auditors are requested to provide information necessary for deliberation at the Board of Directors, each division of the Company will proactively support them by appointing a person in charge.
- The Company regularly sets up opportunities for information exchange so that the Internal Audit Office and directors / corporate auditors can exchange information with each other.
- We will bear the cost of obtaining the advice of outside experts when requested by directors and corporate auditors.
(7) Training policy
- The Company will provide training and information necessary for directors and corporate auditors to properly fulfill their roles and responsibilities.
- When a new director or corporate auditor is appointed, lectures and training on the Company's business content, management philosophy, management policy, law, accounting, and corporate governance will be given according to the attributes of the new director or corporate auditor. It will be held at any time after taking office.
- The Board of Directors provides an opportunity to explain the progress of our business and business issues every month.
Chapter 6 Stock Option System
- We regularly grant stock options to incentives for directors, corporate auditors, executive officers and employees of the Company and its subsidiaries to serve as one of the sound incentives for sustainable growth. To do.
Chapter 7 System for Eliminating Antisocial Forces
- The basic principles of the "Compliance Manual", etc., are to block all relationships with antisocial forces that threaten the order and safety of civil society, and to respond to these persons with a resolute attitude. We will set it to and thoroughly implement it.
Basic Policy on Dialogue with Shareholders
- We will actively engage in dialogue through IR activities to build good relationships with shareholders.In addition, we will strive to understand the composition of shareholders and carry out IR activities according to the characteristics of shareholders.
- The IR department is in charge of dialogue with shareholders, and the president is in charge of it.If a shareholder requests an individual interview, the directors, executive officers or IR will take into consideration the matters of interest of the shareholders at the time of the interview and the Company's prescribed schedule, etc., at a reasonable date and time. The head of the department that has jurisdiction over the above will endeavor to hold an interview.
- In order to effectively and smoothly engage in dialogue with shareholders, the department in charge of IR will play a central role in coordinating with related departments.
- For institutional investors, we will hold a "Financial Results Briefing Session" to explain medium- to long-term management policies, financial results, individual businesses, etc.For individual investors, we will hold an "individual investor briefing session" to explain the business of the company.
- Explanatory materials for financial results briefings and individual investor briefings will be published on our website.
- When formulating and disclosing management strategies and management plans, we will consider presenting the basic policies of profitability plans and capital policies, and presenting goals related to profitability and capital efficiency.
- Opinions and questions obtained through dialogue with shareholders will be reported to the Board of Directors in a timely manner, and useful opinions will be reflected in management to improve corporate value.
- Regarding the management of insider information, we will endeavor to thoroughly manage information and disclose it appropriately in accordance with the Insider Trading Prevention Regulations and the Compliance Manual.
Corporate governance system
I.Overview of corporate governance system
The Company is a company with a board of corporate auditors, and as of the date of submission, it is composed of 5 directors (including 2 outside directors) and 3 corporate auditors (including 3 outside corporate auditors).The annual Board of Directors meeting is held once a month, all important matters are discussed, and the status of business execution is reported at any time.In addition, we have established a system that allows us to flexibly hold extraordinary board meetings as necessary when important agenda items arise.As a supervisory body for decision-making and business execution of important management matters of the company, the validity, efficiency and fairness of management are examined as appropriate, and matters stipulated in laws and regulations and the Articles of Incorporation and matters related to important business are resolved. Doing.
In addition, the Company has adopted an executive officer system in order to enhance and streamline the business execution system of directors.Executive officers who directly direct and supervise each department are appointed by the Board of Directors and carry out the responsibilities set by the Board of Directors.
The Board of Corporate Auditors meets once a month on an extraordinary basis as needed, and the corporate auditors can attend important meetings such as the Board of Directors and the Management Council to fully monitor the execution of duties by directors. We now have.
Our corporate governance system is shown in the figure below.
B.Maintenance status of internal control system
a. System to ensure that the execution of duties by directors and employees complies with laws and regulations and the Articles of Incorporation
- ⅰEstablish a "Compliance Manual" and use it as a code of conduct for directors and employees.
- ⅱDirectors report the status of execution of duties to the Board of Directors, and mutually monitor and supervise the status of execution of duties by other directors.
- ⅲThe status of execution of duties by directors is audited by corporate auditors based on the “Rules of the Board of Corporate Auditors”.
- ⅳThe Internal Audit Office audits the status of compliance.
- ⅴEstablish a system to directly report non-compliance of directors and employees.
b. System for storage and management of information related to the execution of duties by directors
- ⅰInformation related to the execution of duties by directors, such as the minutes of the board of directors, shall be recorded, stored and managed in documents or electromagnetic media based on the "Document Management Regulations".
- ⅱDirectors and Audit & Supervisory Board Members may at any time view records or electromagnetic media regarding information related to the execution of duties by Directors.
c. Regulations and other systems for managing the risk of loss
- ⅰRisks associated with the work under the jurisdiction of each department are managed by the department in charge.
- ⅱThe Risk Management Committee monitors cross-organizational risk situations and responds company-wide.
- ⅲThe Board of Directors will promptly respond to newly created risks.
d. System to ensure efficient execution of duties by directors
- ⅰIn addition to the regular board meeting held once a month, an extraordinary board meeting is held as necessary.
- ⅱAt the management meeting, directors and executive officers exchange opinions with the aim of complementing swift and accurate management decisions.
- ⅲThe directors carry out their duties to achieve the management plan, and the performance / business reports and improvement measures of each department are reported to the board of directors as appropriate and deliberated.
e. System to ensure the appropriateness of business in the corporate group
- ⅰFor our group companies, we will also establish various regulations and build a system to ensure compliance with laws and regulations and the appropriateness and efficiency of operations.
- ⅱBased on the basic policy regarding the management of intra-group transactions, etc., when a subsidiary starts intra-group transactions, etc. that may have a significant impact on group management, the appropriateness and legality of those transactions, etc. After deliberation and consideration of the gender with the subsidiary concerned, a resolution or report is made at the board of directors.In addition, in order to protect minority shareholders, the Company and its subsidiaries do not significantly differ from the conditions of ordinary transactions with third parties in the necessity of such transactions and the conditions of such transactions when conducting transactions with group companies.
- ⅲThe directors will instruct the companies belonging to the Group to carry out proper and efficient management according to their duties.
- ⅳThe Internal Audit Office also conducts internal audits of all group companies.
- ⅴCorporate auditors also monitor and audit the status of business execution of group companies.
f. Matters concerning the employee when the Audit & Supervisory Board Members request that an employee be assigned to assist the duties.
Although the Company does not assign employees to assist the duties of Audit & Supervisory Board Members, the Board of Directors may appoint and assign such employees by consulting with the Audit & Supervisory Board as necessary.
g. Matters concerning the independence of employees in the previous item from directors
If the employee is to be appointed, the appointment, transfer, evaluation, and disciplinary action of the employee shall be carried out after respecting the opinions of the Audit & Supervisory Board Members, and the independence of the employee from the directors shall be maintained. Secure.
h. System for directors and employees to report to Audit & Supervisory Board Members
In addition to the legal matters, the directors and employees shall report the following matters to the Audit & Supervisory Board Members without delay.
- ⅰMatters that have a significant impact on our business
- ⅱResults of internal audit conducted by the Internal Audit Office
- ⅲResults of internal control evaluation conducted by the Internal Audit Office
- ⅳStatus of reports by the whistleblowing system
i. Other systems to ensure that audits by Audit & Supervisory Board Members are conducted effectively
- ⅰMore than half of the corporate auditors will be outside corporate auditors to ensure external transparency.
- ⅱAudit & Supervisory Board Members regularly exchange opinions with Directors and exchange opinions on important audit issues.
- ⅲAudit & Supervisory Board Members regularly exchange information with the Internal Audit Office and the Accounting Auditor, and cooperate to ensure the effectiveness of audits.
- ⅳAudit & Supervisory Board Members may request an investigation from the Internal Audit Office as necessary.
j. System to ensure the appropriateness and reliability of financial reporting
In order to ensure the appropriateness and reliability of the Group's financial reporting, the Company has further developed related regulations such as the "Accounting Regulations" and established the "Basic Policy on Internal Control Related to Financial Reporting". Based on this, we will continue to develop and operate internal controls and evaluate their effectiveness on a regular basis.
k. System for eliminating antisocial forces
The basic principles of the "Compliance Manual" stipulate that all relationships with antisocial forces that threaten the order and safety of civil society should be cut off and that these persons should be dealt with with a resolute attitude.
- a. System to ensure that the execution of duties by directors and employees complies with laws and regulations and the Articles of Incorporation