Corporate Governance

Our basic concept

We believe that establishing firm corporate governance is one of the essential requirements to receive acclaim from stakeholders, including shareholders, and to win public trust, as we are aware that securing sound and transparent management, as well as improving business efficiency, directly leads to increasing corporate value and shareholder value. Based on such principle, we are committed to strengthening our corporate governance by implementing the following measures:

Implementation of corporate governance measures


The Board of Directors is positioned as a body to make decisions on issues designated by laws and regulations and on important managerial issues, while supervising operations with a focus on enhancing reporting from board members.
All Board members (excluding Audit & Supervisory Committee members) are required to attend management meetings (divisional meetings) to facilitate better sharing of information relating to operations, thus putting in place control functions and enabling more prompt operations, in addition to closer scrutiny and supervision of operations.

Audit & Supervisory Committee system

We adopted Audit & Supervisory Committee system, and more than half of all of our members (presently three out of four) of the Committee are outside Directors in pursuit of greater management transparency.
In addition to regular monthly meetings, Audit & Supervisory Committee holds ad hoc sessions as necessary to share information among members. Committee members also attend important meetings including Board meetings to ensure that they actively monitor the performance of Board members.
Furthermore, related departments report to Committee on building and implementing internal control system and based on such reports, if deemed necessary, Committee may require related departments to conduct investigation. This structure enables Committee to effectively cooperate with related departments.

Internal audit and internal control

Internal Audit Dept. (in charge of internal audit of Nippon Kanzai Group) is placed as an independent body under the Audit and Supervisory Committee, and Internal Control Dept. (in charge of conducting internal control evaluation) is placed inside the General Administration Supervising Div.
Internal Audit Dept. audits business procedures, and Internal Control Dept. established internal control system, provides guidance on the system and evaluates internal control, in accordance with laws and company regulations, through cooperation with Audit & Supervisory Committee and auditing firms.
As a part of our efforts to enhance and improve the corporate governance, results of the audit and the evaluation are reported to the President and Representative Director.

Attorneys, accounting auditors and other relevant third parties

Regarding the involvement of attorneys and auditing firms in our corporate governance, Nippon Kanzai considers and implements proper responses to major legal matters in consultation with our corporate lawyers.
Nippon Kanzai has an audit contract with PricewaterhouseCoopers Aarata LLC for regular accounting audits. In addition to regular accounting audit and internal control audit in accordance with Financial Instruments and Exchange Act, Nippon Kanzai assures compliance by having the auditing firm check on important accounting issues and internal control issues.

Disclosure of information

From the perspective of increasing management transparency, Nippon Kanzai continues its efforts to disclose information to shareholders and markets in a timely manner including a more prompt disclosure of financial statements, and to further improve and enhance corporate IR activities.
We are also committed to disclosing management information in an active and timely manner on our website and by other means, in addition to statutory disclosure.