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Corporate Governance

Corporate Governance

  1. Basic Policy on Corporate Governance

    Our company considers the compliance of business activities with legal and social imperatives to be of the greatest importance in increasing the transparency and soundness of our business management. We employ an Audit and Supervisory Committee system and have enhanced our director supervisory function. Our structure comprises an Audit and Supervisory Committee composed of three members who are directors, including two external directors.
    Also, executive meetings (Board of Directors meetings, the Managing Directors Meeting) are held frequently to achieve fast, accurate decision making and effective organizational operations for the Group as a whole. The authority necessary for performing usual corporate activities devolves to the general managers of the six business offices and the presidents of the six consolidated subsidiaries; management meetings are attended by board members, managers and executives of subsidiaries. Consequently, our group has no plans to implement an operating officer system, and board members (excluding directors who are Audit and Supervisory Committee members) will continue to take responsibility for management as well as for business affairs.

  2. Enforcement and Implementation of Corporate Governance
    1. The Board of Directors consists of 10 directors who are no Audit and Supervisory Committee members and three directors who are members of this committee. In principle, the board meets once a month, or additionally as necessary, to make decisions regarding important management issues and to report on business affairs.
    2. The Managing Directors Meeting is attended by board members located at headquarters, and in principle takes place once a week, to deliberate important items related to the operation of the Company other than matters connected with or decided by the Board of Directors. This meeting maintains a system that ensures the timely execution of business activities.
    3. Management meetings are held once a month and attended by board members, department heads, and directors of subsidiary companies. In addition, the Management Information Meeting, attended by related board members and department heads, is held each month to enhance operational efficiency by sharing management information.
    4. The Audit and Supervisory Committee meets once a month and consists of three members, including two external directors who have no vested interest in the Company. In addition to attending Board of Directors and other important meetings, they audit the execution of duties by the directors.
    5. Internal audits are performed by two full-time employees who are retained in the Audit Office, which reports directly to the president. These employees periodically perform audits on the effectiveness of internal controls and business efficiency and report the results to the president. The Audit and Supervisory Committee and the audit offices report the methods and results of audits as appropriate, conduct information exchanges, cooperate with the accounting auditors to conduct efficient business audits, and strive to strengthen the auditing functions.
    6. A committee for the promotion of the internal control system headed by the president is in place and is making concrete progress on implementing internal control system programs.
    7. As our company considers social and public responsibilities to be of utmost importance, we have established a compliance committee headed by the president, which formulates and internally publicizes an ethical charter. Furthermore, the committee works to further strengthen the compliance system by conducting intermittent educational activities, such as holding compliance study groups attended by all employees—particularly the managing board members for each department—once a month or more.
    8. The Board of Directors decides the basic internal control policy and maintains a system to ensure appropriate business practices.
    9. A risk management committee headed by the president is in place and manages risks to the Company in an exhaustive and comprehensive manner. Risk management regulations have been formulated, risk maps are prepared, and departments are assigned responsibility according to the type of risk. Response measures are formulated to address important risks, and the Company endeavors to control risks. When new risks emerge, the Company promptly assigns a department with responsibility for these risks. In addition, the Audit Office audits the status of risk management at individual departments. The office periodically reports the results of these audits to the Risk Management Committee and the Board of Directors and deliberates and decides on improvement measures.
  3. Development of a System to Ensure Appropriate Business Practices
  4. The Board of Directors decides the basic internal control policy and maintains a system to ensure appropriate business practices.
    The current status of the Company’s management decision making, internal control system and corporate governance structures are described below.

    Daiseki’s Corporate Governance Structure

    Daiseki' s Corporate Governance Structure