Our company is conducting business by promoting transparent business management and maintaining high ethical standards, as well as ensuring the observation of laws and regulations, so that our group can increase corporate value in a sustainable manner and become a company capable of winning the trust of stakeholders.

Given the content of business operations covered by our group and their characteristics, our company has adopted an executive officer system and an in-house company system as a means of expediting decision-making and clarifying who is responsible for executing certain business operations. As a means of controlling these systems, we have established corporate governance under which the Board of Directors, Corporate Auditors/the Board of Corporate Auditors and Accounting Auditors have been set up to clearly divide the functions of business execution; managerial decision-making and supervision; and the supervision of management.

In addition, our company has established the Management Committee, an organization tasked with carrying out the deliberation of important issues relating to executing the business operations of the company and its group companies. Corporate Auditors are supposed to attend a meeting sponsored by the Management Committee. This committee will deliberate over important issues to be discussed at the Board of Directors and clarify focal points, before presenting these issues to the Board of Directors. The prior deliberations are meant to promote appropriate decision-making and enhance the efficiency of decision-making at the Board of Directors.

At present, our company’s Board of Directors is composed of 10 persons, including one Outside Board Director. Articles of incorporation stipulate that Board Directors are not allowed to sit on the Board of Directors for more than one year, a rule designed to clarify the management responsibility of Board Directors. Furthermore, the company has set up a “reward committee,” which serves as an advisory organization to the Board of Directors. That committee, consisting of three persons including two Outside Board Directors, is supposed to deliberate on guidelines relating to the financial treatment of full-time Board Directors and Executive Officers, and the implementation of the guidelines. The “reward committee” has been instrumental in achieving the payment of appropriate remuneration to full-time Board Directors and Executive Officers.

The Board of Corporate Auditors of our company is composed of five persons―two full-time Corporate Auditors and three Outside Corporate Auditors―who work on a part-time basis. Moreover, the Board of Group Corporate Auditors, whose members include Corporate Auditors at group companies, has been established as a way of strengthening auditing among group companies.

By improving and reinforcing the corporate governance systems mentioned above, we will maintain expeditiousness and flexibility in business execution, strengthen our overall corporate governance, and clarify where responsibility lies, thus realizing efficient and transparent business management, which is considered helpful in enhancing the corporate value of the Nabtesco Group.