INITIATIVES TO STRENGTHEN CORPORATE GOVERNANCE

Initiatives to Strengthen Corporate Governance

The Company positions the development and promotion of the corporate governance system as one of the most important management issues, and implements ongoing initiatives to strengthen corporate governance.

Date Overview
Apr. 2000 Established the Office of Statutory Auditors
Apr. 2003 Introduced the Executive Officer System
Established the Strategic Planning Committee
Established the Executive Committee
Apr. 2005 Established the Audit Committee
Sep. 2005 Established the CSR Committee
Jun. 2006 Introduced Outside Directors (three (3) Directors)
Abolished the retirement bonus plan and introduced stock options
Jun. 2007 Increased Outside Directors (four (4) Directors)
Shortened Directors’ Term
Apr. 2012 Established the Risk Management Committee (currently Risk Management Compliance Committee)
Jun. 2016 Made the transition to a Company with Nominating Committee, etc.
Jul. 2016 Introduced restricted stock compensation
Feb. 2017 Introduced Evaluation of the Board of Directors
Sep. 2017 Formulated Corporate Governance Guidelines

Evaluation of the Effectiveness of the Board of Directors

The Company regularly conducts self-evaluations of each director with regard to operation of the Board of Directors and the content of deliberation. The results of these evaluations shall be reported to the Board of Directors, and the Board of Directors analyzes and evaluates its effectiveness based on these self-evaluations and other information.
The process and results of evaluation of the effectiveness of the Board of Directors conducted in fiscal 2017 are as follows.

1. Process of Evaluation

(1) Method of Evaluation

All Directors provided self-evaluation in the form of a response to a questionnaire relating to the composition, operation, effectiveness, etc., of the Board of Directors and each of the Nominating, Audit, and Remuneration committees, and taking these results into consideration, they shared the issues with each other and examined proposed corrective measures at Board of Directors meetings.

(2) Items of Evaluation

Composition of the Board of Directors Proportion of outside directors, size in numbers, diversity
Operation of the Board of Directors Frequency, required time, selection of agenda, content of handout materials, information other than handouts provided, questions and answers, training, etc.
Effectiveness of the Board of Directors Management plan, delegation of authority to corporate executive officers, risk management systems, dialogue with shareholders and investors, election and dismissal of key management personnel, successor training plan, remuneration paid to officers, composition, operation, cooperation of each of the Nominating, Audit, and Remuneration Committees, etc.
Others Method of the evaluation of the effectiveness of the Board of Directors, etc.

2. Results of Evaluation and Future Initiatives

(1) Main items improved since the previous evaluation

As a result of examination and discussion at the Board of Directors meetings, one point was identified.

  • With regard to dialogue with shareholders and investors, as result of increasing the number of  opportunities to deliver reports at meetings of the Board of Directors, prompt sharing of information and improved discussions at meetings of the Board of Directors were achieved.

(2) Main issues and future initiatives aimed at further improvements in effectiveness

As a result of examination and discussion at the Board of Directors meetings, two points were identified.

  • In addition to enhancing the examination and discussion of the management plan by increasing the number of opportunities to perform these activities, and allowing more time for them, initiatives are to be taken to examine the process by which the management plan is formulated, and to carry out a detailed review of the themes that should be discussed by the Board of Directors.
  • With the aim of enhancing discussion of important matters, meetings of the Board of Directors will continue to consider the frequency with which items related to the status of the performance of duties of Corporate Executive Officers are reported, and the content thereof.

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