Corporate Governance
Stock ticker code: 6104
Shibaura Machine respects human values as its fundamental policy. Our group's mission is to contribute toward building the foundation for industry by creating an abundance of values and helping to improve people's lives and cultural development across the world. We also have a responsibility to observe the law and act according to social and ethical principles as we engage in our business. We have therefore established the Shibaura Machine Group Standards of Conduct in order to formulate our corporate philosophy. Based on this philosophy and these standards of conduct, we have developed a corporate governance system which is highly transparent. We have achieved this by building a suitable system of internal controls based on our “Fundamental Policy of Internal Control", by setting up a “Nomination Advisory Committee” and a “Remuneration Advisory Committee” to enhance transparency and fairness in the nomination and remuneration of directors and auditors and, through the operation of our executive officer system, by realizing the separation of management and execution of business, the clarification of management responsibilities, and the enhanced efficiency and alacrity of management decision_making and business execution. We also have also a corporate system where an auditing officer works with accounting auditors and our internal auditing department to monitor company management.
Corporate Governance System Outline
1. Board of Directors
The Company’s Board of Directors comprises nine directors (excluding directors who are Audit and Supervisory Committee members), of whom five are outside directors, and three directors who are Audit and Supervisory Committee members, of whom two are outside directors. As well as regular monthly meetings of the Board of Directors, extraordinary Board meetings are convened as required. In addition to deliberating, making decisions, and reporting on the stipulations of statutory laws and regulations and the Company’s Articles of Incorporation as well as important business matters, the Board of Directors develops the internal control system and ensures its effectiveness. Furthermore, the Company has designated the seven aforementioned outside directors as independent officers. Also, the Nomination Advisory and Remuneration Advisory committees have been established as advisory committees to the Board of Directors. The former deliberates on matters concerning the Company’s directors and other important personnel matters, while the latter deliberates on the remuneration of the Company’s directors, excluding directors who are Audit and Supervisory Committee members, with both committees reporting their findings to the Board of Directors. Further, both of these committees are chaired by outside officers.
2. Management Strategy and Management Meetings
The Management Strategy and Management meetings are both held monthly to deliberate, report on, and determine management policies and strategies as well as to deliberate, make decisions, and report on important matters related to business execution.
3. Board of Auditors (effort to improve functionality of auditors)
The Company’s Audit and Supervisory Committee has three members, of whom two are outside directors and one is a full-time member. By attending meetings of the Board of Directors and other important meetings, Audit and Supervisory Committee members, who have voting rights, are able to audit and supervise the execution of duties by directors. In addition, the Audit and Supervisory Committee coordinates with the accounting auditor and the Internal Auditing Department to audit business management.
4. Internal Auditing Department
The Internal Auditing Department verifies the legality and appropriateness of business activities, reports audit results to the representative directors, and provides guidance if there are any matters requiring improvement. Further, the Internal Auditing Department comprises 12 members and is under the direct control of the representative directors. The Internal Auditing Department shares information with the Audit and Supervisory Committee and the accounting auditor in a timely manner, submits reports to the Audit and Supervisory Committee as required, and promotes mutual coordination with the committee.
5. Accounting Auditor and lawyer
The Company has engaged Ernst & Young ShinNihon LLC to conduct fair, appropriate accounting audits. In addition, the Company receives timely advice from a consulting lawyer when legal decisions are required.