GLORY’s corporate philosophy, which represents our corporate goal and raison d’etre, is: “We will contribute to the development of a more secure society through a striving spirit and cooperative efforts.” These words express our determination to achieve growth as a sustainable enterprise by contributing to a prosperous society through our uncompromising approach to product development.
This philosophy guides our efforts to continuously improve our corporate value through sound and efficient business management, so that we can exist in harmony with society and earn the trust and support of all stakeholders.
None of these goals can be achieved without a firm commitment to the continuing improvement of corporate governance. We will continue our efforts to strengthen the supervisory and executive functions of management, accelerate decision making, ensure transparency and objectivity, and enhance compliance management, thereby improving corporate value.
Corporate Governance Framework
How do we strengthen our corporate governance system?
- Q1 Please outline GLORY's corporate governance system.
- Q2 What steps has GLORY taken to enhance transparency and fairness of management?
- Q3 How is GLORY enhancing corporate governance on a group-wide basis?
- Q4 How is management supervised?
- Q5 What other mechanisms are there to ensure transparency and objectivity?
- Q6 Please describe GLORY's compliance system.
- Q7 What efforts are being made to vitalize the General Meeting of Shareholders?
Q1 Please outline GLORY's corporate governance system.
We aim to strengthen management supervision, speed up decision making and deliver efficient business administration through a system centered on the Board of Directors, which includes two outside directors, and the Board of Corporate Auditors.
The Board of Directors, consisting of nine directors (including two outside directors), makes decisions on important matters and oversees business execution. President & Representative Director serves as chairman of the Board of Directors meetings. We have sought to both energize the Board of Directors and assure quick decision making by reducing the number of directors from 16 to 9 in fiscal 2007 and introducing an executive officer system.
The Board of Corporate Auditors, consisting of two corporate auditors and two outside corporate auditors, assesses directors' conduct of duties and audits the legality of execution. The corporate auditors perform regular audits based on an annual audit plan and participate in important meetings, such as those of the Board of Directors and the Management Conference, which discusses business execution policies and plans based on basic policies established by the Board of Directors.
Q2 What steps has GLORY taken to enhance transparency and fairness of management?
Having two experienced outside directors actively participate in management improves management transparency and fairness.
Of the nine directors, two are outside directors. After appointing one outside director for the first time in June 2007, we expanded this to two in fiscal 2008.
The current outside directors have held key positions at globally recognized companies and brings both abundant experience and global perspectives to the Board. The veteran advice from them contribute to greater transparency and fairness of management.
The two outside directors also serve key roles in ensuring effective and appropriate decision making by providing alternative perspectives and opinions based on many years of management experience. They attend meetings of the Nomination Advisory Committee and the Compensation Advisory Committee, which were established to increase transparency and objectivity in the appointment of directors, corporate auditors and executive officers and in the setting of remuneration, as well as Management Conference meetings.
Q3 How is GLORY enhancing corporate governance on a group-wide basis?
Under the 2014 Medium-Term Management Plan, we are actively working to strengthen group-wide governance.
We have developed “the Group Structure Strategy” in our 2014 Medium-Term Management Plan, which includes the strategy to enhance corporate governance on a group-wide basis. This strategy is part of the Corporate Management Strategy under the Plan, which aims to strengthen the foundation of the group management.
By aggressively promoting this strategy, we will further strengthen our governance system, encompassing overseas subsidiaries as well, and make compliance management an even more integral part of the Group’s operations.
Q4 How is management supervised?
The Board of Corporate Auditors, consisting of two full-time and two outside corporate auditors, is tasked with overseeing management.
The corporate auditors attend the Board of Directors meetings and Management Conference meetings to verify the appropriate and fair deliberation of directors, and also performs thorough audits in collaboration with accounting auditors, the Internal Audit Department and corporate auditors of subsidiaries.
GLORY has two outside corporate auditors: One company executive and one attorney-at-law. As the outside corporate auditors bring their expertise to the supervisory function, they contribute to increasingly sound management that takes into account not only the legality and appropriateness of GLORY's management but also enhances efficiency and objectivity.
Q5 What other mechanisms are there to ensure transparency and objectivity?
We presently have special committees, such as the Nomination Advisory Committee, the Compensation Advisory Committee and the Disclosure Committee, to ensure transparency and objectivity.
The Nomination Advisory Commit tee and Compensation Advisory Committee ensure transparency and objectivity in the appointment of directors, corporate auditors and executive officers and the setting of their remuneration. Both committees have five members and are chaired by Chairman of the Board. The other four members are President & Representative Director, one part-time director (attorney-at-law) and two outside directors. With the outside members in majority, the committees ensure higher transparency and objectivity by giving careful deliberation to committee issues prior to presentation to the Board of Directors. To promote timely and appropriate disclosure, we have established the Disclosure Committee, which is chaired by the Chief Information Officer, director who is responsible for Administration. This committee reviews the needs and contents of disclosures before resolutions are taken by the Board of Directors.
Q7 Please describe GLORY's compliance system.
We view compliance as an important management objective. We have established a Corporate Compliance Committee and appointed a Chief Compliance Officer, and also set up compliance helplines.
GLORY is taking decisive steps to enhance its group-wide compliance structure. As part of this effort, we have set up a Corporate Compliance Committee, which is chaired by President & Representative Director and includes two outside experts, who are both lawyers. The committee reviews key issues regarding compliance and reports matters to the Board of Directors. The Board of Directors appoints a director to serve as the Chief Compliance Officer who oversees the activities managed by the Secretariat of the Corporate Compliance Committee, including the promotion and implementation of various compliance-related measures as well as training for employees.
GLORY has also set up four compliance helplines, including one outside helpline for employees of Group companies, and does its utmost to promptly detect and correct any compliance violations and protect reporters' anonymity.
Q8 What efforts are being made to vitalize the General Meeting of Shareholders?
We have attempted to make the meeting more inviting to shareholders by adopting an electronic voting system, and by sending out notices of the General Meeting of Shareholders earlier. Also, after the meeting, our showroom is open to shareholders.
To enable shareholders to adequately review proposals addressed at the General Meeting of Shareholders, we have since June 2008 delivered materials for the meeting three weeks in advance. In 2003, GLORY adopted electronic voting, and in 2007 we began using the electronic proxy voting system for institutional investors (the ICJ system) sponsored by the Tokyo Stock Exchange.
On the day of the meeting, narrations and audiovisual presentations are used, and the President reports in detail on the Group's business performance and management status. After the meeting, the Company's showroom is open to shareholders, at which time directors, executive officers and staff members actively promote communication with shareholders by explaining about products and the history of GLORY.
The voting results for the General Meeting of Shareholders held in 2009 are posted on our corporate website at http://www.glory-global.com/ir/meeting/.