The following describes our basic policy on corporate governance and the tatus of implementation of relevant measures.
Corporate Governance Report
Our Basic Policy on Corporate Governance
Seiren’s corporate governance policy is based on its corporate governance philosophy of satisfying the needs of stockholders, customers and local communities, while developing into “an excellent company for the 21st century” where its employees can work with pride. To achieve this policy of corporate governance, our company has established a system centered on its boards of directors and auditors, in which its labor union and management representatives participate to form a “Management Council” to ensure the transparency and integrity of our company and its group companies as a whole, thereby strengthening our entire corporate governance and compliance practices. In addition, with the “Five Corporate Principles (Go-gen-Shugi)” of “theoretical approach”, “observance of rules”, “field visits”, “actual product and fact-based analysis” as the basic principles of its work, our company will continue to be committed to practicing our corporate management philosophy and conduct code to create higher added value and improve our corporate value, as well as to fulfill our corporate social responsibility.
It should be noted that, in order to clarify our group's fundamental policy on corporate governance and policy on its operation, we have established and publicly released "Seiren Group Corporate Governance Guideline".
Description of Our Corporate Governance System and Reasons for its Adoption
To ensure its corporate governance based on its corporate governance policy as described above, our company has established a corporate governance system centered on its boards of directors and auditors.
Our company’s board of directors comprises 12 members including three (3) from outside the company, serving as a decision making body in which they fully discuss its corporate governance practices.
In addition, we have adopted an executive officer system with executive officers assigned as responsible for execution of our corporate business activities, the positions of whom are assumed by the nine (9) directors. Our company’s board of auditors comprises four (4) members, including two (2) from outside the company. The full-time auditor fulfill his or her duties by participating in meetings of the board of directors and other important meetings, including meetings convened by the Management Council to supervise the company’s management and execution of its business activities. In addition, each of the auditors works in cooperation with the company’s global operation auditing division to monitor and verify the appropriateness of its internal operation control system. Therefore, Seiren has adopted its currently established corporate governance system, judging this system to be optimal for ensuring the integrity and transparency of its corporate management.
Maintenance Status, etc. of the Company’s Internal Control System
- System for Retaining and Controlling Information on Performance of Duties by the Directors <Information Control System>
The Company retains, controls and make accessible minutes of important meetings such as meetings of the Board of Directors and meetings of the Management Council, approval requests for execution of business operations (“ringi-sho”), important contracts, various statements of accounts and management plans.
- System for Rules for Management of Risk of Loss (Risk Management System)
The Company prevents any risks from occurring by grasping them through meetings of the Board of Directors, meetings of the Management Council and meetings of the Management Strategy Council and obtaining agreements in executing any business operations in accordance with the Company’s in-house rules for approval requests.
The Company also controls the production system for each of its factories and plants in accordance with the rules set forth to ensure their safety, health, disaster prevention and pollution control.
In addition, the Company has established the “Whistleblowing System” for receiving information from all stakeholders including its employees on any acts etc. considered to be questionable in light of any law, ordinance, regulation or in-house rule, and the Global Operations Audit Office is in charge of receiving such information.
- System for Securing Efficient Performance of Duties by the Directors <Efficient Business Execution System>
The Company formulates the company-wide targets to be shared by its directors and employees at term-by-term plan hearings, department meetings and the Management Council meetings.
In order to achieve such targets, each director in charge of business operation execution sets the concrete target of each department, devises methods to efficiently achieve such target including retransfer of his/her authority in accordance with the in-house rules for authority transfers and decision makings and periodically reviews the progress of achieving such target at department meetings and the Management Council meetings by utilizing the information technology (IT). In addition, any urgent and important matters are to be sufficiently considered and discussed at a Management Strategy meeting composed of relevant directors, etc. before being submitted to the Board of Directors to expedite decision making on such urgent and important matters.
In addition, amendments to the organizational rules have been adopted at the Board of Directors meeting to define the allotment of duties, authority accompanying each duty, role and responsibly of every person holding a managerial post at the Company.
- System for Securing Compliance of Performance of Duties by Directors and Employees with Laws, Ordinances, Regulations and Articles of Association <Compliance System>
The Company has established its corporate ethics as a public company in the society by securing the Compliance System through the Board of Directors meetings and the Management Council meetings in accordance with laws, ordinances, regulations, the articles of association and various rules (collectively hereinafter referred to as “Regulatory Requirements”) and widely specifying the code of conduct of its directors and employees through the code of ethics, the guidelines for ethical conduct of employees and the rules for controlling treasury stock trading. The Company also controls personal information by laying down the guidelines for protection of personal information and the security policy.
In order to aim to further reinforce awareness of compliance with the Regulatory Requirements (hereinafter referred to as Regulatory Compliance among its employees, the Company will establish the basic rules for the compliance of the SEIREN Group and form a Compliance Committee including external lawyers as its members in order to promote planning of a policy regarding the compliance and education and training of its employees on the compliance.
- System for Securing Appropriateness of Business Operations of Corporate Group Composed of the Company and its Subsidiaries <Group Control System>
- （1）System for Reporting to the Company on Matters Relating to Performance of Duties by Directors, etc. of its Subsidiaries
- The Company has established in-house rules for management control of its subsidiaries in addition to the “SEIREN Group Corporate Governance Standards” and defined the role and responsibility of each of presidents, directors and chief executives of the subsidiaries.
- In accordance with these in-house rules among others, the Company has laid down approval rules, based on which it has established a system where all important matters relating to the management of each of the subsidiaries shall be subject to the approval of the Company or reported thereto. In addition, each of the subsidiaries shall report the status of its business operation execution, financial condition, etc. to the Company on a monthly basis.
- （2）System for Rules, etc. for Management of Risk of Loss by the Subsidiaries of the Company
- In order to address or handle various risks associated with corporate activities of our Group, each department at our head office and the Global Operations Audit Office shall function as our Group’s global headquarters and manage such risks in accordance with our in-house rules such as the “SEIREN Group Corporate Governance Standards” by endeavoring to closely cooperate with each of our group companies.
- （3）System for Securing Efficient Performance of Duties by the Directors, etc. of the Subsidiaries of the Company
- The Company formulates medium-term management plans and annual management plans for its subsidiaries on a consolidated basis and specifies a business performance target of each of the subsidiaries in order to achieve a performance target of the entire SEIREN Group. If any of the subsidiaries significantly fails to achieve its annual management plan or change such plan, it shall report such failure or change to the Company in an appropriate and timely manner.
- The subsidiaries shall execute their respective business operations in accordance with the in-house rules for management control of the subsidiaries and endeavor to improve the transparency and efficiency of the management of the subsidiaries and the entire Corporate Group.
- （4）System for Securing Compliance of Performance of Duties by Directors, etc. and Employees of the Subsidiaries with Laws, Ordinances, Regulations and Articles of Association (“Regulatory Compliance”)
- In order to establish the compliance system of the SEIREN Group, the Company will lay down basic rules for Regulatory Compliance of the SEIREN Group (hereinafter referred to as the “Basic Rules”) and continue to provide education and training to its employees regarding Regulatory Compliance based on the Basic Rules.
- Under the “Whistleblowing System”, whistleblowers and persons requesting consultations shall include employees of each of our Group companies and employees etc. of its suppliers, contractors, customers, etc. who shall have been informed of the direct telephone number and email address of the office to which each of them may report directly.
- Matters Relating to Employees in Charge of Assisting Performance of Duties of Audit and Supervisory Board Members of the Company (hereinafter referred to as “Corporate Auditors”) and Matters Relating to Securing Independency of Such Employees from the Directors and Effectiveness of Instructions Given to Such Employees
- The Company has appointed assistants to the Corporate Auditors at the Global Operations Audit Office, assigning them to function as the secretariat of the Board of Corporate Auditors and assist the Corporate Auditors. It is stipulated that performance assessments and transfers of such assistants shall be approved by the Full-Time Corporate Auditors in advance. It is also stipulated that such assistants shall not obey any direction or order given by any superiors of the organizations which such assistants belong to or those executing any business operation in connection with any such work for assisting the Corporate Auditors as assigned to such assistants by such auditors.
- In order to grasp the processes of important decision makings and the status of execution of any business operations, the Corporate Auditors attend important meetings such as Board of Directors meetings and read important documents such as approval requests for execution of any business operations (“ringi-sho”). In addition, the Internal Audit Department and the Corporate Auditors of the subsidiaries give audit reports to the Corporate Auditors of the Company. If any event causing any significant damage to the Company occurs or is likely to occur at any of the subsidiaries, the directors, etc. and employees of the subsidiary report such event to the Corporate Auditors as soon as it is found.
The departments in charge of the “Whistleblowing System” of our group fully report the statuses of internal reports received from officers, managers, employees, etc. of our group to the Corporate Auditors of the Company. It is stipulated that any persons giving such reports or consulting such departments shall never be dismissed or otherwise treated unfavorably.
- The Company budgets a certain amount of expenses, etc. required for performance of duties by the Corporate Auditors for each fiscal term, and the assistants to the Corporate Auditors settle such expenses as soon as they are incurred.
- The Corporate Auditors conduct interviews with heads of the Company’s divisions, departments and factories and chief executives of its important subsidiaries and exchange opinions and views with each of the Representative Director, the Internal Audit Department and the Accounting Auditors on a periodical basis.
- Our group’s basic policy for the elimination of antisocial forces is that it shall never have any relation with any antisocial force or organization and resolutely deal with any undue demand made thereby for securing our sound corporate activities. The Company has described the standards of actions to be taken against antisocial forces in the corporate code of conduct of our Corporate Group “Guidelines for Employee Conduct Based on Corporate Ethics” and made its contents thoroughly known to all employees through in-house training regarding Regulatory Compliance. The Company has designated the General Affairs Division as an antisocial force response contact point to properly respond to or deal with any antisocial force in cooperation with the police authority, the legal advisors, etc. while consulting with any relevant division or department if necessary.
Based on its Basic Policy for Corporate Governance, the Company has promoted management of Regulatory Compliance by establishing a “whistleblowing system” and a whistleblowing contact point for receiving reports and consultations from all stakeholders including its employees on any acts, etc. considered to be questionable in light of any law, ordinance, regulation or in-house rule.
- Applicable users of the whistleblowing system
- Persons relating to SEIREN Group (including its regular employees, semi-regular employees, contract employees, part-time employees, temporary workers, retired employees, suppliers, contractors, customers, etc.)
- Violations of applicable laws and regulations, violations of the Company's internal rules and regulations, accounting fraud and other similar compliance violations
- Seiren Co., Ltd. Global Operations Office/Direct Tel: No.: +81-776-35-2115
Information Disclosure Policy
- Our Fundamental Policy on Information Disclosure
- Our company has established a disclosure policy which shall require the Company to disclose any important information regarding its management, whether positive or negative, in a voluntary, fair, lawful and appropriate manner by complying with all applicable laws and regulations.
- Our company has designated its "General Affairs Division" (hereinafter referred to as the General Affairs Division) as a contact point for disclosure of important information about our company (herein after referred to as Important Company Information) so that the General Affairs Division, in close coordination with our company's Corporate Strategy & Planning Division (hereinafter referred to as the Corporate Strategy & Planning Division), shall disclosure important Company Information, whether any decision made by our company or any event that occurred relevant to our company,, so as to make the Important Company Information available to investors.
Any Impotent Company Information to be decided on by our company regarding its management shall be discussed and decided on at meetings of our company's Board of Directors (hereinafter referred to as the Board of Directors) according to the Rules of the Board of Directors and any Important Company Information to be decided on by our company regarding its operations shall be discussed and decided on at meetings of our company's Management Council (to be convened on a monthly basis attended by our company's directors, executive officers and heads of its related divisions including the General Affairs Division, as well as its auditors) according to the rules set forth by our company with regard to the Management Council.
Any Important Company Information thus decided on by our company shall be then discussed between the General Affairs Division and the Corporate Strategy & Planning Division as described above to determine whether to disclose the Important Company Information by reference to the disclosure requirements specified by the Tokyo Stock Exchange and swiftly disclose it if its disclosure is required to be made as a result of the discussion between the two divisions.
It should be noted that our company has set up a "Insider Trading Control Committee" to make constant checks on trading of our company's shares by any of its officers and employees in order to prevent insider trading. Therefore, our company's Disclosure Policy stipulates that any Important Company Information regarding our company's shares is to be treated as strictly confidential by all attendees to meetings for discussion on the Important Company Information and all personnel performing clerical work related to disclosure of the Important Company Information before its official announcement.
- Any Important Company Information required to be disclosed based on the specified Timely Disclosure Rules shall be disclosed using TDnet (Timely Disclosure Network) provided by the Tokyo Stock Exchange, while being posted on our company's homepage at an appropriate timing. It should be noted that any Important Company Information, even if not required to be disclosed based on the specified Timely Disclosure Rules, shall be posted on our company's homepage from time to time in line with the intent of the specified Timely Disclosure Rules.
- IR Library