Corporate governance

Basic Stance

By adopting a Company with an Audit & Supervisory Committee structure, under which directors who are Audit & Supervisory Committee members audit and supervise execution of duties of executive directors while having voting rights of the Board of Directors, the Company aims to further enhance auditing and oversight functions. The Company’s Board of Directors consists of nine members, with four of those nine members serving as members of the Audit & Supervisory Committee. The Board meets at least once a month. The Board’s three external directors are charged with the independent oversight of business operations.
We have also established the Nominating and Compensation Committees, both made up of a majority of external directors and chaired by an external director, as consultative bodies of the Board of Directors to further enhance corporate governance.

Analysis and Evaluation of the Effectiveness of the Board of Directors

The Company analyzes and evaluates the effectiveness of the Board of Directors every year and discloses a summary of the results. The Board of Directors performs a self- evaluation questionnaire in regard to the operation of the Board and their management style, and the chair of the Board performs the analysis and evaluation based on the directors’ self-evaluation and reports the results to the Board of Directors for discussion. In 2023, the Board set a goal to “ensure fulfilling discussions toward the improvement of mid-to-long term corporate value in light of changes in business structure and diversification of values” and discussed various issues including strategic challenges, capital policy and sustainability with a view to the future. As a result, the Board confirmed the need to further enhance discussions toward the improvement of mid-to-long term corporate value. Based on this, the Board set a goal for 2024 to "ensure fulfilling discussions toward the improvement of mid-to-long term corporate value through enhancement of future profitability and sustainable growth strategy."

Internal Control

Improvement toward effective internal control

To meet the requirements stipulated in the Financial Instruments and Exchange Act pertaining to reporting of internal control over financial reporting, the Company has designed and implemented internal control to ensure the reliability of financial reporting in accordance with the basic frameworks for internal control and the definition of evaluation and reporting set out in the standards released by the Financial Services Agency. The Group is also working to improve the effectiveness of internal control based on objectives of internal control including operational effectiveness and efficiency, reliability of reporting, legal compliance regarding business activities, and asset protection.

Information Security

Strengthening system/education/Group IT governance

In terms of maintenance and management of information security, we have strengthened technical measures, including by implementing measures against information leakage from terminals and external storage media to deal with unauthorized access and malware infection due to increasingly sophisticated cyberattacks and enhancing plant network security in light of the expansion of IoT.
As for information security education, we provide training on targeted e-mail attacks and information security training to all employees using the system to increase employee security awareness on an ongoing basis. As part of internal control audit, we also perform IT control audits to strengthen IT governance throughout the Group including domestic and overseas affiliates.