Basic Philosophy regarding Corporate Governance
Our corporate philosophy is "SAVE the DIGITAL WORLD: With the well-established skills and abilities of our employees, we uphold the quality standards of IT innovation and help bring comfort and security to a high digitized society to support progress and development."
Based on this corporate philosophy, we will build a corporate governance system with the transparency of its management and the monitoring/supervisory functions in order to further enhance our corporate value through activities responding to the expectation from stakeholders including shareholders, clients, business partners, employees, and local communities.
Organs of the Company
Board of Directors
The Board of Directors of the Company consists of five directors (including two outside directors) and holds a regular meeting one a month, in principle, and an extraordinary meeting as needed. At the meetings of the Board of Directors, the directors deliberate and adopt a resolution on important matters related to those listed below.
(1) Matters related to the general meetings of shareholders
(2) Matters related to the settlement of accounts
(3) Matters related to officers
(4) Matters related to shares and corporate bonds
(5) Matters related to the dividend of surplus
(6) Matters related to important human affairs
(7) Matters related to the execution of important businesses
(8) Matters related to subsidiaries
(9) Matters related to the establishment, revision and abolition of important rules and regulations
(10) Other matters that require a resolution of the Board of Directors pursuant to the Articles of Incorporation and the company rules and regulations.
The Board of Directors of the Company consists of the following directors.
President, Representative Director Yasumasa Ninomiya (Chairman of the Board of Directors)
Chairman, Director Eiichi Miyazawa
Executive Vice President, Director Toshiya Tsukushi
Outside Director Takashi Yanagiya
Outside Director Gaku Ishiwata
Board of Corporate AuditorsThe Board of Corporate Auditors of the Company consists of four auditors (including two outside corporate auditors) and holds a regular meeting once a month.
The Board of Auditors of the Company consists of the following auditors.
Standing Corporate Auditor Masahide Date (Chairman of the Board of Corporate Auditors)
Corporate Auditor Keiya Kazama
Outside Corporate Auditor Toshifumi Nikawa
Outside Corporate Auditor Yoko Okano
Nominating and Remuneration Committee
The Nominating and Remuneration Committee consists of outside directors who form the majority of its members to ensure the fairness and objectivity of its decision-making on the nomination and remuneration, etc. of the directors, corporate auditors and executive officers of the Company and its major subsidiaries and to strengthen the corporate governance function of the Group as an advisory organ of the Board of Directors. The committee submits opinions on the nomination and remuneration, etc. of the directors, corporate auditors and executive officers to the Board of Directors. The Board of Directors of the Company will make related decisions with utmost respect for the opinion from The Nominating and Remuneration Committee.
The Nominating and Remuneration Committee consists of the following members.
Chairman, Director Eiichi Miyazawa (Chairman of the committee)
Outside Director Takashi Yanagiya
Outside Director Gaku Ishiwata
In the Company, two internal auditors who belong to the Internal Audit Office under the direct control of the president conduct internal audits from the standpoint of effectiveness and efficiency of Group business activities in cooperation with auditors and the accounting auditor. The internal auditors conduct audits of the entire Group based on an annual plan in conformity to the company rules and regulations concerning internal audits.
Audit results are reported directly to the president, and specific improvement guidance is given to the audited departments and divisions based on the audit results. Additionally, the status of progress will be verified and analyzed and improvement guidance will be conducted when needed.
In addition, maintenance of internal control systems related to financial reporting as well as evaluation of their operations will be conducted based on the internal governance reporting system.
Audits by Corporate Auditors
The Company conducts audits by corporate auditors in a systematic and planned manner by establishing the Board of Corporate Auditors, and the audits by corporate auditors are carried out effectively and efficiently in cooperation with internal auditors and the accounting auditor.
Our Board of Corporate Auditors is composed of four corporate auditors (including two external auditors). The Board of Corporate Auditors are generally held once a month. During the fiscal year ended March 2020, the Board of Corporate Auditors are held 12 times and all corporate auditors attended these 12 meetings.
Major issues discussed in these meetings were related to the audit policies and audit plans, the selection, evaluation and compensation of accounting auditors, compliance with laws and regulations, the operation and development of risk management systems, and the operation and development of internal control systems.
Based on the audit policy and the audit plan, corporate auditors attend the board of directors meetings, and have interviews with directors of the Company or presidents of subsidiaries of the Group to understand the status of business execution. In addition to the above, the standing corporate auditor conduct highly effective audits, such as attending important meetings of the Company and the subsidiaries, reviewing important documents related to decision-makings, and exchanging information with the internal audit division.
Corporate Governance Structure
The Group recognizes it essential to observe compliance for the sound development of the Group. These guidelines set forth the Group's approach, initiatives to observe compliance, and the action guidelines that all of our group employees should follow. We will continue to promote compliance by taking initiatives for deeper understanding of these guidelines throughout the Group.
2 General Provisions
(1) Definition of Compliance
For the Group, compliance goes beyond the level of just observing laws and ordinances and is defined as responding to the trust of our various stakeholders, including business partners, customer or client, shareholder, local communities, and employees. To this end, we must have a strong sense of ethics and integrity, in addition to an awareness of Legal Compliance.
(2) Scope of Application of the Compliance Guidelines
The Compliance Guidelines apply to not only our executives and employees, but also temporary staff and those who are stationed at our offices based on outsourcing contracts. Therefore, the departments that have adopted these people must be responsible for communicating the purpose and meanings of these guidelines. In these guidelines, the Group refers to group companies and includes companies considered as substantially managed by us.
(3) Response to Compliance Violations
The Group will consider to take measures such as disciplinary action, including dismissal, against behaviors deemed to violate these compliance guidelines.
To promote compliance, we have established the Compliance Committee, chaired by the president of DIGITAL HEARTS HOLDINGS Co., Ltd., and it consists of directors and corporate auditors of the holding company, presidents of group companies, and others. In addition, each group company will establish and educate its own rules according to the region and businesses characteristics, based on these compliance guidelines of the Group.
(5) Whistleblowing contact points of the Group
The Group's internal reporting system has been established as follows as a whistleblowing contact points for reporting and consulting cases in which employees and others become aware of any compliance problems. As a result of reporting compliance issues, whistleblowers will not be treated disadvantageously by the Group. If it is determined that an employee has been treated disadvantageously, we will investigate the case and respond to it.
■ Whistleblowing contract points of the Group
E-mail: (Internal Auditing Department) firstname.lastname@example.org
3 Compliance action guidelines
(1) We will comply with all laws, social norms, internal rules, etc. in Japan and overseas, and act in good sense as a member of society.
(2) We will respect customer or client comments, give top priority to customer or client satisfaction, and provide a variety of services.
(3) We will strictly manage personal information and customer or client information. We will not illegally obtain information from third parties or infringe on intellectual property rights.
(4) We will not engage in illegal trade or any conduct that would impede fair competition.
(5) Our group does not go beyond the bounds of socially accepted norms in providing and receiving entertainment and gifts to and from business partners. In addition, we will comply with relevant laws and regulations with regard to relationships with public officials equivalent thereto.
(6) We will conduct sound businesses activities and disclose information in a legal and appropriate manner. In addition, we will not undermine the relationship of trust with investors or business partners, such as insider trading or illegal accounting.
(7) Our group respects human rights and does not engage in discrimination or harassment. We will also create a healthy and comfortable work environment that ensures safety and health.
(8) We take a firm stance and have no relationship with any anti-social forces that pose a threat to the order and safety of civil society.
4 Supplementary Provisions
Revisions to these guidelines will be resolved at our board of directors.