We have formulated a Fundamental Policy on Internal Control System Development to ensure risk management and compliance, to manage group companies and information, and to ensure the suitability of other tasks. Based on this policy, we are constructing such a system. The president and directors who are responsible for business execution will be in charge of the specific efforts to develop and operate the internal control system, in line with their positions. Through post-event checks by internal auditors and the running of the internal reporting system for legal breaches or unsuitable actions, we are ensuring that the internal control system’s development and operations are appropriate. The Internal Control Committee periodically monitors the development and operation of the system overall, including of the above. The Board of Directors, meanwhile, oversees the development and operation of the internal control system and reviews the fundamental policy to respond to changes in circumstances. Through these steps, it is working to guarantee and enhance the effectiveness of our internal control system.
Fundamental Policy on Internal Control System Development
The Company's Board of Directors has resolved the following Fundamental Policy on Internal Control System Development.
In order to ensure that business of the Group is conducted properly in accordance with the Corporate Mission, the Company shall establish the following system (internal control system) in accordance with the Companies Act and the Ordinance for Enforcement of the Companies Act.
The president and each director in charge of business execution shall be responsible for the specific development and operation of the internal control system in accordance with their duties, and the Internal Control Committee shall periodically monitor the status of the system.
The Board of Directors shall ensure and improve the effectiveness of the internal control system by supervising the development and operation of the internal control system and by reviewing this fundamental policy in response to changes in circumstances.
- A system for ensuring the execution of duties performed by directors and employees of the Company and its group companies complies with laws, regulations, and the Articles of Incorporation
- Establish a code of conduct for the Company and the Group, and ensure that all officers and employees act in accordance with the code.
- Establish specific procedures for the proper and efficient execution of business operations, and execute duties in accordance with such procedures.
- Establish a Compliance Committee to promote and supervise compliance within the Company and the Group.
- Establish an internal reporting system so that officers and employees of the Company and its group companies can directly report compliance violations or possible violations to the Whistleblower Help Desk (inside or outside the Company).
- Establish a dedicated department in charge of internal audit for the execution of business operations of the Company and its group companies. Make improvements when problems are found.
- Eliminate all relationships, including business relationships, with anti-social forces.
- A system for the retention and management of information related to the execution of business duties by the Company's directors
The Company shall establish management rules for information pertaining to the execution of duties and shall retain and manage such information according to the nature and importance of the information in accordance with the laws and these rules.
- A system and rules for managing the risk of loss for the Company and the Group
- The Company shall identify and evaluate management risks in the Company and the Group and implement countermeasures. In addition, the Company shall establish a Risk Committee to promote and supervise risk management in the Company and the Group.
- The Company shall establish a reporting system so that information on management risks of the Company can be appropriately reported to the Board of Directors and other relevant bodies.
- The Company shall establish rules governing procedures in the event of disasters, accidents, and other emergency situations, and implement drills and other measures to minimize damage in the event of an emergency.
- A system to ensure efficient execution of duties by directors of the Company and the Group
- The Company shall establish rules that clearly define the authority and responsibilities of each organization under the control of the directors in order to ensure the efficient execution of duties by the directors of the Company and the Group.
- The Company shall establish an IT system for easy and quick access to management information for the entire Group to improve the efficiency of management.
- A system for reporting to the Company about matters related to the execution of duties by directors, etc., of the Company's group companies
The Company shall establish rules that stipulate standards and procedures for reporting from each group company to the Company and shall request reports in accordance with such rules. Important management matters at each company in the Group shall be discussed at meetings of the Company's Board of Directors and other meetings in accordance with established standards.
- Matters concerning employees assisting the Audit and Supervisory Committee, matters concerning the independence of such employees from directors (excluding directors who are members of the Audit and Supervisory Committee), and matters concerning the effectiveness of instructions given to such employees by the Audit and Supervisory Committee
The Company shall establish rules for the appointment of assistant employees and for ensuring their independence, as well as rules for ensuring the effectiveness of the Audit Committee's instructions to such assistant employees.
- A system for reporting to the Audit and Supervisory Committee
- Directors and employees of the Company and the Group shall promptly report to the Audit and Supervisory Committee on matters necessary for audits when requested to do so by the Audit and Supervisory Committee or when required to do so by law.
- The plans, progress of implementation, and results of internal audits conducted by the department in charge of internal audits shall be reported to the Audit and Supervisory Committee.
- Establish rules that stipulate that a person who reports to the Audit Committee shall not be treated disadvantageously for having made such a report.
- Matters concerning the policy for the treatment of expenses, etc., incurred in the execution of duties by members of the Audit and Supervisory Committee
The Company shall budget for expenses related to the execution of duties by members of the Audit and Supervisory Committee and shall bear such expenses within an appropriate range.
- Other systems to ensure the effective implementation of audits by the Audit and Supervisory Committee
- Members of the Audit and Supervisory Committee shall be able to attend important internal meetings and have access to the minutes of important meetings, documents detailing final decisions, contracts, and other information necessary for the Audit and Supervisory Committee to conduct audits.
- The president and the members of the Audit and Supervisory Committee shall meet regularly to exchange opinions.
Group Company Management
For group companies, business-related issues are handled by business departments that have a close relationship with the relevant business area, while compliance matters are under the purview of the legal department, and the corporate planning and accounting department deals with other general operational matters. In this way, each related department supports and manages our group companies.