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Corporate Governance

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Basic Policy on Corporate Governance

The Group considers the enhancement of corporate governance to be one of its most important management focus points. The Group believes that working to increase management quality and enhance the transparency of decision-making is indispensable, and accordingly, continually strives to strengthen corporate governance. This ensures that the Group continues to fulfill its founding mission as stated in its corporate philosophy: “Serving Society with Superior Quality.”

Based on this approach, in accordance with the responsibility and authority delineated in the Administrative Authority Rules, and in line with the Policy Management Rules, the Company is committed to developing, communicating, and abiding by fair, transparent decision-making and management policies.

As one facet of initiatives to strengthen its corporate governance system, to achieve both further strengthening of its internal control system and heightened speed in execution, the Company transitioned to the “Company with Nominating Committee, etc.” model of corporate governance in March 2016. The Group will continue striving to further strengthen both the efficiency and the effectiveness of management and execution.

Corporate Governance Structure

The Company has 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 24, 2017, 11 directors were elected, including seven outside directors. 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 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 four 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 five members, consisting of three outside directors and two internal directors. This committee conducts audits regarding the business execution of executive officers and directors. The two internal directors on the Audit Committee are full-time members of the Audit Committee. The Compensation Committee has four members, all of whom are outside directors. This committee deliberates on such matters as the details of compensation for directors and executive officers.

Regarding the management system, the CEO and representative executive officer (CEO) and the COO and representative executive officer (COO) are the leaders of the operating divisions. The CEO is principally in charge of overall management and strategy, and the COO is principally in charge of operations. At the same time, these two officers implement a system of mutual checks. The Company is further strengthening its corporate governance system by separating and clarifying the respective roles and authority of the CEO and the COO, advancing the sharing of information, and increasing the transparency of decision-making processes. Further, under the CEO and COO, respective executive officers are responsible for decision-making and the business execution in relation to matters delegated to them by the Board of Directors. In addition, following deliberations by the Officer Nomination and Compensation Meeting, which is an advisory body to the CEO and COO, full-time corporate officers, who are elected by the CEO, are responsible for business execution under the direction of the executive officers.

Corporate governance structure (as of March 24, 2017)

Advisory Committees to the Board of Directors

To further increase transparency of corporate governance, the Governance and Compliance Committees has been established as advisory bodies to the Board of Directors. These advisory committees provide advice to the Board of Directors in regard to such matters, the governance system and related issues, and overall compliance activities. These committees are comprised of a total of seven outside directors and one or more internal directors, who are members of the Audit Committee participate as observers.

Executive Operational Committee

With regard to the execution of business operations, the Company has established the Global Executive Committee (Global EXCO) in 2013, which oversees business execution on a Group and Global basis, the Executive Operational Committee and other policy management meetings. These Committees deliberate and report on specific matters set forth in Company policy as well as other important matters. In addition to key executive officers such as the CEO and COO, full-time corporate officers also participate in the Global EXCO and the Executive Operational Committee meetings along with other policy management meetings.

Internal Control Systems: Basic Approach and Implementation

The Company implements audits through cooperation among the Audit Committee, the Internal Auditing Office, and the independent auditors.

Auditing Structure

The Company implements audits through cooperation among the Audit Committee, the Internal Auditing Office, and the independent auditors.

In accordance with audit policies determined by the Audit Committee, the Committee works in cooperation with the Internal Auditing Office and other bodies to audit the execution of business duties by executive officers and directors. These auditing activities include attendance at important meetings, such as the Global EXCO and the Executive Operational Committee; interviews to ascertain the status of operations; reviews of important business documents; and on-site audits of business offices. Moreover, information and opinions are exchanged with the representative executive officers, and meetings are held with such persons as the corporate auditors of major subsidiaries in Japan. In addition, the Company has assigned a corporate officer with full-time responsibility for auditing to assist the operations of the Audit Committee. Under the supervision of this corporate officer, dedicated staff have been assigned to assist with audits by the Committee. Decisions to select and replace this corporate officer require the agreement of the Audit Committee.

The Internal Auditing Office and internal auditing departments within the Company’s operating divisions and major subsidiaries conduct internal accounting and operational audits of the Company and Group companies. The Internal Auditing Office makes annual audit plans and conducts on-site audits of each function, operating division, and subsidiary.

In cooperation with the Audit Committee, Deloitte Touche Tohmatsu LLC performs the accounting audit of the Company’s financial statements.
The Audit Committee, the Internal Auditing Office, and the independent auditors exchange information and opinions as necessary and generally maintain close contact, thereby working to further increase audit efficiency and effectiveness.

Board of Director, Executive Officer and Corporate Auditor Remuneration (January-December 2016)

Positions Members Amount of Compensation, Etc.
Directors 13 People
(of whom eight are outside directors)
¥213 million
(of which ¥97 million is for outside directors)
10 People ¥562 million
4 People
(of whom two are outside corporate auditors)
¥24 million
(of which ¥6 million is for outside corporate auditors)
Total 27 People ¥800 million
  1. Figures include two directors (one an outside director) who retired during the subject fiscal year, and one executive officer who resigned.
  2. Bridgestone transitioned to a “Company with Nominating Committee, etc.” model of corporate governance from a “Company with Board of Company Auditors” model through a resolution adopted at the 97th General Meeting of Shareholders held on March 24, 2016. Accordingly, the figures in the above chart for the amount of compensation paid to corporate auditors and the number of auditors reflect the total amount for duties performed and the number of corporate auditors during the period from January 1 to March 24, 2016.
  3. The figure for total number of members is an overlapping total including a director who retired with the transition to the “Company with Nominating Committee, etc.” model and was appointed an executive officer, a corporate auditor who retired and was appointed director, and a person who serves concurrently as director and executive officer.

Report on the Corporate Governance Code

Bridgestone Corporation submitted the report on the “Corporate Governance Code” to the Tokyo Stock Exchange, with verification concerning the state of correspondence to all principals. The “Corporate Governance Code” was added to the listing rules of the Tokyo Stock Exchange in 2015 to contribute to the realization of effective “Corporate Governance” as the KEY principals. The Company publishes “Corporate Governance Code Report” and published them on its website.

Through the explanation of the Company’s idea of the “Corporate Governance” and introducing efforts towards it, Bridgestone Corporation is aiming to promote greater understanding of its “Corporate Governance”.

2016 Report on the Corporate Governance Code(252KB)