In March 2016, the Company transitioned to the “Company with Nominating Committee, etc.” model and has a system that enhances the separation of management and operational responsibilities and allows the directors and the Board of Directors to focus more effectively on overseeing the execution of business operations. At the Annual Shareholders’ Meeting held on March 22, 2019, 11 directors (nine male and two female) were elected, including eight outside directors (six male and two female). The Chairman of the Board, who is selected from among the directors in accordance with the Articles of Incorporation and the Board of Directors’ Rules, serves as the chairperson of both Board of Directors’ meetings and the General Meeting of Shareholders.
In addition, items related to decisions on basic management policies, important business execution matters, and other matters that must be determined by the Board of Directors are stipulated in the Articles of Incorporation, the Board of Directors’ Rules, and Administrative Authority Rules. These matters are determined after careful deliberations by the Board of Directors.
The Company has established and maintains a corporate governance system that functions through appropriate, active performance of duties by the Nominating Committee, the Audit Committee, and the Compensation Committee, in conjunction with oversight of the executive officers and directors by the Board of Directors. The Nominating Committee has three members, all of whom are outside directors. This committee deliberates on such matters as standards and policies for the fair, transparent appointment and dismissal of directors. The Audit Committee has six members, consisting of five outside directors and one internal director. This committee conducts audits regarding the business execution of executive officers and directors. The internal director on the Audit Committee is a full-time member of the Audit Committee. The Compensation Committee has three members, all of whom are outside directors. This committee deliberates on such matters as the details of compensation for directors and executive officers.
In order to further increase the transparency of corporate governance, the Governance Committee and the Compliance Committee have been established as advisory committees to the Board of Directors. These committees deliberate on the corporate governance system and related matters and on compliance activities as a whole and submit reports to the Board of Directors. Both of the committees are composed of eight outside directors. One internal director, who is a member of the Audit Committee, participates as an observer.
The various operating divisions—consisting of eight executive officers, including three representative executive officers—make decisions on the execution of operations delegated by the Board of Directors and assume responsibility for the execution of those decisions. In addition, these divisions have adopted a system in which members are collectively responsible for management. Moreover, the CEO and COO have been placed in charge of each unit of the SBUs (Strategic Business Units), which comprise domestic and overseas Group companies as well as internal companies, and employ a system of mutual checks. These executive officers, as well as persons responsible for major business entities, comprise the Global Executive Committee (Global EXCO), which has been established as an organizational body for top executive management. This committee serves to strengthen the checks and balances capabilities of the Group by debating and discussing management strategy and issues from a global perspective, which improves transparency of the decision-making process. In addition, each operating division maintains a reporting system to the appropriate representative executive officer of that division regarding the execution of duties. This information is also regularly and promptly reported to the Board of Directors in order to aid in their deliberations, and these actions ensure that the Group maintains an effective supervisory function.