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Corporate Governance

Basic Approach to Corporate Governance

The Company and the company group comprising its subsidiaries (hereinafter called the “Group”) consider that their corporate governance is based on improvements and the implementation thereof to ensure that actions are taken pursuant to the Group’s corporate philosophy and code of conduct, decisions are made in a transparent, fair and efficient manner, laws and regulations are strictly observed, and corporate performance is monitored appropriately.

The Outline of Corporate Governance Structure

The Group is managed under a holding company structure in which the Company, which is the ultimate parent company, is a holding company and its group companies are operating companies. By separating the function of administering its overall business from executing its individual businesses, the Group has been working to facilitate the delegation of authority and strengthen the Company’s function of monitoring the Group’s businesses.
The Board of Directors shall consist of a majority, at the minimum, of highly independent Outside Directors. The Board currently consists of eight Directors, five of whom are Outside Directors. It determines matters prescribed by laws and regulations and the Articles of Incorporation and matters concerning the execution of important business and oversees the execution of business. Furthermore, as part of strengthening of its corporate governance system, the Company introduced an executive officer system in January 2017. Under this system, the authority for making decisions and executing business operation is delegated to Executive Officers (hereinafter, “Group Executive Officers”) to the extent permitted by relevant laws and regulations, in order for the Board of Directors to mainly focus on the oversight (monitoring) of the Group Executive Officers who are responsible for the execution of business (monitoring model- oriented).
The Group Executive Officers are responsible for the execution of business of the Company, that of the business companies in its group or that across several business companies. The Board of Directors appoints Group Executive Officers in charge of respective areas of business operation, and the Group President and Chief Executive Officer who concurrently serves as Representative Director oversees the execution of business operations by the Group Executive Officers.
Moreover, matters to be resolved by meetings of the Board of Directors, those regarding which authority is to be delegated to the Group Executive Officers and those to be reported by the Group Executive Officers to the Company’s Board of Directors are clearly stipulated in the regulations of the Board of Directors.
In addition to the above, Group Management Meeting has been established, as a system regarding decision-making on the execution of business, with the functions of supporting decision-making by the Group President and Chief Executive Officer and of considering important managerial matters of the group. The Company has also established a Group Risk Management Committee that supervises risk management of the group, a CSR Committee that has authority for discharging corporate social responsibilities through CSR activities and a Financial Results and Disclosures Committee that reviews and evaluates financial results information, information for timely disclosure, among other things. In doing so, the Company has put in place a system that clarifies authority and responsibilities and enables prompt and appropriate decision-making.
On the other hand, Nomination Advisory Committee, the majority of which consists of Outside Directors, has been established as an optional committee of the Board of Directors to handle personnel matters regarding the group’s management team (appointment, removal etc. of Directors of the Company, Group Executive Officers and others), in order to ensure the independence, objectivity and accountability of the deliberation process. In addition, meetings attended only by the Outside Directors (Executive Session) are held once every quarter in principle, thereby securing a place for information exchange and shared awareness from objective standpoints. Outside Auditors, external accounting auditors and other independent outside persons may attend such meetings, thereby providing a place for promoting cooperation among independent outside persons.
The Company has adopted a company auditor system. Under the system, there are currently four Company Auditors including three highly independent Outside Auditors. Each Company Auditor audits the execution of business by the Directors, in accordance with the auditing policy, audit plans and so forth determined by the Board of Company Auditors.

Corporate Governance System

Progress of Governance Reforms

Main Initiatives
Number of Outside Directors
Fiscal Year
 Ended September 2015
  • Systematization of governance for greater effectiveness
Increased to two
(including a female director)
Fiscal Year
 Ended September 2016
  • Introduction of effectiveness evaluation to enhance the functioning of the Board of Directors
  • Establishment of the Financial Results and Disclosures Committee and the CSR Committee
  • Abolition of anti-takeover measures
  • Establishment of Group Risk Management Committee
Fiscal Year
 Ended September 2017
  • Introduction of performance-linked stock compensation system for officers
  • Seperation of execution and monitoring through the introduction of an entrustment-type executive system
Outside directors become
the majority of
the Board of Directors
Fiscal Year
 Ended September 2018
Fiscal Year
 Ended September 2019

Governance Highlights

(Fiscal year ended September 2020)

Number of Directors
(Outside Directors Included in Total)
Number of Board of Director's Meetings Held
Average Attendance Rates at Borad of Directors' Meetings
Number of Auditors
(Outside Auditors Included in Total)
Number of Borad of Auditors' Meetings Held
Average Auditor Attendance Rate at Board of Auditors' Meetings

Note:Above figures include one director who retired during the fiscal year.

Evaluation of the Effectiveness of the Board of Directors

With the aim of enhancing the function of the Board of Directors, the Company analyzes and evaluates the effectiveness of the Board of Directors once a year in principle. A survey for all directors and company auditors was implemented based on advice from third party institutions in the fiscal year ended September 2019. Additionally, interviews with some directors were conducted. As a result, it was confirmed that the Board of Directors is managed appropriately, specific initiatives to improve its effectiveness are promoted voluntarily with a clear sense of purpose, and its effectiveness is ensured. Meanwhile, we recognized that there is room for improvement in areas such as balanced discussion, decision-making and reporting for further enhancing the quality of discussion in the Board of Directors. The Board of Directors of the Company should advance efforts to further heighten its effectiveness, by implementing measures that lead to resolving these issues.

Officer Compensation Plan

In September 2017, the Group introduced a new compensation plan (a board incentive plan (BIP) trust) to more clearly define the relationship between the remuneration of the Company’s directors (excluding outside directors and non-residents of Japan) and executive officers (excluding non-residents of Japan; collectively, “Directors, etc.”) and the Group’s business results in the medium-to-long term as well as the Company’s shareholder value, while creating a sound incentive to enhance business results and corporate value in the mediumto-long term. As a result, remuneration for directors of the Company consists of monthly compensation and stock compensation, and remuneration for outside directors who are independent from business execution consists of monthly compensation only.

BIP Trust

This is a performance-linked stock compensation plan that aims to establish a clearer relationship between remuneration for Directors, etc. and the value of the Group’s stock. The Company's shares are purchased from the market as officer compensation, kept in a trust account and delivered in accordance with the recipient’s position and degree of achievement of the performance targets in the Midterm Business Policies.

Director and Auditor Remuneration

Category Number of Recipients Officer Remuneration Remarks
Director 7 ¥158,966 thousand 4 outside directors included in above ¥39,200 thousand
Auditor 5 ¥43,800 thousand 3 outside auditors included in above ¥12,600 thousand
Category Director Auditor
Number of Recipients 7 5
Officer Remuneration ¥158,966 thousand ¥43,800 thousand
Remarks 4 outside directors included in above ¥39,200 thousand 3 outside auditors included in above ¥12,600 thousand


  • Of all directors, part of remunerations, etc. for serving concurrently as directors of subsidiaries of the Company are borne by the subsidiaries as expenses.
    Amount of remunerations, etc. to directors, combining the amount borne by the Company above and the amount borne by the subsidiaries, is ¥194,852 thousand.
  • The number of payees includes one outside director who retired on August 31, 2020 and one outside company auditor who retired at the close of the 29th Ordinary General Meeting of Shareholders held on December 18, 2019.
  • In addition to the above amount of remunerations, etc., based on the resolution for discontinuation payments with the elimination of the officer retirement benefit system approved and adopted at the 13th Ordinary General Meeting of Shareholders held on December 18, 2003, we have paid ¥266 thousand in officer retirement benefits to one company auditor who retired at the close of the 29th Ordinary General Meeting of Shareholders held on December 18, 2019.

Reasons for Appointment of Outside Directors

The reasons are described on the Our Executives page.

Our Executives