Corporate Governance

Basic Policy for Corporate Governance

Takeuchi is committed to remaining a trustworthy organization that can constantly increase corporate value while fulfilling its obligations to shareholders and all other stakeholders. This is why we place priority on maintaining an effective system of corporate governance for the fair and transparent management of our operations. We are also committed to upgrading corporate governance by building an administrative framework that facilitates quick and proper decision-making and the accurate communication of the goals of management to others.

Corporate Governance Structure

1. Overview

  • The Board of Directors has three directors (excluding directors who are members of the Audit and Supervisory Committee) and three outside directors who are members of the Audit and Supervisory Committee. The Board of Directors is the highest ranking decision-making unit. The directors meet once each month to reach decisions about items designated by management policies and laws and regulations as well as about other important matters. The Board of Directors also supervises the performance of the directors.
  • The Board of Directors names executive directors and executive officers who are responsible for conducting business operations. As needed, executive officers are asked to attend board meetings in order to explain management decisions accurately and to conduct business operations quickly.
  • The Audit and Supervisory Committee consists of three outside directors, one of whom is a full-time member of this committee. In principle, the committee meets once each month. Committee members also attend meetings of the Board of Directors and other important meetings. Committee members audit the performance of the directors and the operation of the system of internal controls and perform other duties.
  • The Nomination Advisory Committee and Remuneration Advisory Committee, which are not legally required, have been established to provide recommendations to the Board of Directors. Each committee consists of four directors (one internal director and three outside directors). These committees discuss nominations and dismissals of directors, the remuneration of directors, and other subjects submitted by the Board of Directors and then submit recommendations. The Board of Directors then uses these recommendations as the basis for further discussions and a final decision.
  • Each business unit has a business plan that is based on the business plan for the Takeuchi Group. Business units periodically submit reports concerning their business plans.

The following chart provides an overview of Takeuchi’s corporate governance framework

Corporate Governance Framework

2. Other Information about Corporate Governance

Internal controls

Takeuchi has a Corporate Philosophy, Code of Conduct, Compliance Rules and a Compliance Manual for the purpose of ensuring that directors and employees follow laws and regulations and the Articles of Incorporation and fulfill their obligations as members of society. A Compliance Officer supervises activities for making everyone at the Takeuchi Group aware of these guidelines.

Risk management

Activities concerning risk management are prescribed in the Risk Management Rules. We have a Risk Management Officer for each category of risk in order to maintain a framework for monitoring and managing risk.

Group management

For sound management of the Takeuchi Group, there are extensive measures to ensure that directors and employees fully understand the Takeuchi Corporate Philosophy and Code of Conduct so that subsidiaries conduct business operations properly. There are also Group Supervision Rules. Takeuchi makes decisions regarding certain important matters from among the responsibilities of subsidiaries’ directors. In addition, subsidiaries periodically submit reports to Takeuchi about their business operations.

Internal Audits and Audits by the Audit Supervisory Committee

The Auditing Office is independent of business operations and reports directly to the company president. Three full-time staff members perform audits of the operations and risk management of business units. Directions for improvements are given as needed. In addition, the Auditing Office shares information with the independent accountant concerning internal audits and financial audits.

Audits by the Audit and Supervisory Committee are performed by the three outside directors based on an annual auditing plan. Committee members share information about these audits periodically with the independent accountant. Committee members also receive reports and other information from internal auditing sections and perform other activities.

Financial Audits

Financial audits are performed by Deloitte Touche Tohmatsu LLC in accordance with an auditing contract.