- Investor Relations
- Management Policy
Based on a management vision of “to be a company trusted and supported by all stakeholders (an admired company),” the Company advocates “sustainable growth” as its foremost priority. In order to attain the objective and to enhance its corporate value over the medium to long term, the Company continuously strives to enhance and strengthen corporate governance to realize fair and transparent decision-making in a swift and decisive way.
Based on the above management vision, we formulated our Corporate Governance Guidelines at a meeting of the Board of Directors held on November 27, 2015. The Guidelines set out our basic approach to, and frameworks for corporate governance.
The Company has in place an audit & supervisory board system, with more than half of its members being independent outside Audit & Supervisory Board members, who audit the execution of duties by the executive directors. In addition, independent outside executive directors who constitute more than 30% of the members of the Board of Directors supervise management and execution of duties. The Company also has an executive officer (vice president) system to strengthen the management control and supervisory functions of the Board of Directors and to execute business more efficiently and promptly. Moreover, by establishing its Advisory Committee, the Company adopts a fair and objective way of selecting and dismissing the Company’s executive directors and vice presidents, and of determining their remuneration. The Company seeks to form a highly effective corporate governance structure by these measures.
The Company has established an Advisory Committee as a consultative body of the Board of Directors to improve the transparency and fairness of management and strengthen corporate governance. The Advisory Committee discusses the selection, dismissal, remuneration, and other matters of executive directors and vice presidents. The Advisory Committee comprises representative directors, outside executive directors, full-time Audit & Supervisory Board member(s), and outside Audit & Supervisory Board members. An outside executive director serves as chair of the Advisory Committee.
The Company has established Independence Standards for outside executive directors and outside Audit & Supervisory Board members as follows, and deems that any outside executive director and outside Audit & Supervisory Board member who do not fall under any of following items possess independence from the Company with no risk of a conflict of interest with general shareholders.
Board of Director meetings
Activities for fiscal year 2018
|Number of Board of Directors meetings||held 12 times|
|Number of Audit & Supervisory Board meetings||held 13 times|
|Board meeting Attendance rate by Outside Executive Directors||100%|
|Board meeting Attendance rate by Outside Audit & Supervisory Board Members||100%|
|Audit & Supervisory Board meeting Attendance rate by Outside Audit & Supervisory Board Members||100%|
Main proposals discussed by Board of Directors
- Assessment of Board Effectiveness
- Medium-term business plan
- Revision of the Corporate Governance Code
- Establishment of subsidiaries and additional investments
Self-assessment of effectiveness of Board of Directors
Every year, the Board of Directors analyzes and assesses whether it is functioning effectively and fulfilling its role, taking into consideration the self-assessment of individual executive directors, and discloses a summary of the results.
Policy for determining executive remuneration
Policy for determining the amount of remuneration, etc.
The basic policy for the Company’s executive remuneration system is to strengthen the performance-linked component and is designed for sustained growth of the Company and sustained improvement of its corporate value, as well as providing a fair and objective process to determine remuneration.
Remuneration of Executive Directors (excluding Outside Executive Directors)
Remuneration of executive directors (excluding outside executive directors) consists of three components—a fixed basic remuneration, a bonus linked to short-term earnings performance that is paid annually, and equity compensation-type stock options, which are linked to medium- to long-term earnings performance.
To ensure fairness and objectivity of remuneration of executive directors (excluding outside executive directors), the basic remuneration and equity compensation-type stock options are determined by a resolution of the Board of Directors following deliberations of the Advisory Committee and the bonus by a resolution of the General Meeting of Shareholders. Remuneration should be within the scope of executive directors’ remuneration approved by the General Meeting of Shareholders.
The base figure for basic remuneration should be determined according to each executive director’s position.
Bonuses are determined for each executive director based on target attainment rates for companywide consolidated earnings (productivity per employee calculated from consolidated revenue and consolidated operating income) and earnings performance of the business division for which each executive director is responsible (productivity per employee calculated from the division’s order bookings, revenue, and operating income).
Equity compensation-type stock options
Equity compensation-type stock options are designed to share the risks and advantages of share price fluctuations with shareholders, raise medium- to long-term corporate value, further increase motivation to raise the Company’s share price, and boost morale by linking executive directors’ remuneration with the value of shares. The number of stock options allocated to each executive director is calculated by dividing the base figure determined for each position by the fair value price per stock option.
Remuneration of Outside Executive Directors and Audit & Supervisory Board Members
Remuneration of outside executive directors consists solely of basic remuneration to ensure independence. To ensure fairness and objectivity of remuneration of outside executive directors, remuneration is determined by a resolution of the Board of Directors following deliberations of the Advisory Committee. Remuneration should be within the scope of executive directors’ remuneration (for all executive directors including outside executive directors) approved by the General Meeting of Shareholders.
Remuneration of Audit & Supervisory Board members consists solely of basic remuneration to ensure independence. Remuneration of Audit & Supervisory Board members is determined by discussion of the Audit & Supervisory Board, within the scope of Audit & Supervisory Board members’ remuneration approved by the General Meeting of Shareholders.
Policy on dialogue with shareholders
The Company considers dialogue with shareholders to be important from the perspective of sustained growth and medium- to long-term increases in corporate value.
- Depending on the purpose of the dialogue, senior members of the management team or other executives should take the initiative in dialogue with shareholders.
- The department in charge of public relations and investor relations conducts dialogue with shareholders, overseen by the executive director responsible for the department. Departments in charge of public relations and investor relations, corporate planning, finance and accounting, legal and CSR support dialogue with shareholders by organic collaboration, such as sharing information.
- The Company is proactive in holding quarterly earnings results briefings for analysts and institutional investors, business presentations after Ordinary General Meetings of Shareholders for individual investors, overseas IR presentations, as well as feeding back the views and concerns of investors to the Board of Directors and other internal committees as appropriate.
- The Company has established regulations to prevent insider trading and is committed to strict management of insider information to prevent the leaking of such information outside the Company through dialogue with shareholders.