In order to continue to improve the corporate value, improve the efficiency of management, accelerate decision-making, we believe that it is necessary to improve the mobility.
At the same time, in order to enhance the soundness and transparency of management is, enhance and strengthen the strengthening of management oversight function and compliance with laws and regulations has been recognized as an important, essential to build a corporate governance system we believe.
Based on the above concept, we have a board of directors meeting for a company and Audit & supervisory board.
① Of corporate governance structure
A. Overview of the system of corporate governance
The Company, in order to improve the corporate value, increase the efficiency of management, accelerate decision making, it is necessary to improve the mobility, in order to enhance the integrity and transparency of management is, management improvement and strengthening of the strengthening of the oversight function and compliance with laws and regulations is important, we believe it is essential to build a corporate governance system in order to be realized this.
Based on the above concept, we have a board of directors meeting for a company and Audit & supervisory board.
The contents of the Company of the institution is as at the filing date of the next.
(a) Board of directors
The Board of Directors is composed of 8 members, including one outside director, holds extraordinary board of directors if necessary in addition to the regular meeting of the Board of Directors once a month, as a decision-making body on the management do planning and monitoring and supervision of business execution of management strategies.
(b) Audit＆supervisory board
Audit & supervisory board is composed of three members, including two outside auditors, meets once a month, conducts consultations on important matters related to audit, has to check the legality of the executive.
Auditors are in addition to express their opinion and attend to the Board of Directors and Management Committee, have to understand in a timely manner the management of the actual situation as well as monitoring the performance of duties of the Board of Directors.
(c) Management meeting
Management meeting is composed of the Company's managing director or more of the Board of Directors and auditors, we are held once a month in principle.
B. Relationship of the company's organization and internal control
C.Situation of the basic idea and its maintenance on internal control system
The Company, in the resolution of the Board of Directors held on May 21, 2015, the basic policy of the system to ensure the appropriateness of the Company's business (internal control system) was revised, an overview of its contents it is as follows.
(a) System for the performance of duties of directors and employees to ensure compliance with laws and regulations and the Articles of Incorporation
1) The Company and its subsidiaries (hereinafter referred to as "the Group") are, in response to social trust as a company, in order to clarify the basic attitude of corporate ethics and compliance, established the HSK Group Charter of Corporate Behavior, it our all of the Group be thorough to executives and employees.
2) The Group, established the "Compliance Committee", which is chaired by our president, as well as deliberate on important issues of compliance, to implement the enlightenment education in order to strengthen and corporate ethics penetration of the compliance regime.
3) The Group, if they have found the act, such as a compliance on doubt, along with installing a window that can be reporting and consultation as soon as possible in-house and outside the company, adhere to the reporting and consultation content as secret, disadvantageous for reporting and consultation person not carried out such handling.
4) As internal control organization, we set up Internal Audit department to be under the direct control department of the Company's president.
Internal Audit department, for such as the efficiency of compliance and operational activities of the laws and regulations, conduct internal audits to the Company each department and its subsidiaries in cooperation with auditors, perform a specific advice and recommendations towards the business improvement.
(b) System for storage and management of information relating to the execution of duties by directors
The decision-making or the report for the directors of the Board of Directors, based on the document management regulations for the creation of documents, storage and disposal, have carried out properly stored and managed.
(c) Rules and other systems for management of risk of loss
The Board of Directors build a system that can identify, analysis and evaluate about the risk foreseen over the entire company based on the business environment, status, etc. of company property.
Further they build a risk management system with the ability to respond to business environment changes such as business and financial environment, globalization and the legal regulations of the company.
In each business divisions and its subsidiaries, responsible for analyze related to the crisis and develop each of the deal policy.
For crisis management status of the entire group, we verify our deal policies the after a comprehensive grasp in management meetings.
(d) System for the performance of duties of the Directors to ensure that this is done efficiently
1) As the basis of the system that the execution of duties by directors to ensure the efficient performance, in addition to be held once a month the regular meetings of the board of directors, held in appropriate extraordinary, conduct determination of important matters as well as the audit of the executive situation of the Board of Directors and the like.
2) On important matters related to management, management meeting composed of managing directors or highers, and auditors have held more than once a month, shall be made an executive decision by the Board of Directors through its deliberations.
3) For the management of the business, it shall be developed a medium-term management plan and annual plan and set company-wide goals.
In addition, the Division Board composed of directors and responsible persons of each business division and its subsidiaries have held at least once a month, we have responsible persons of each business division and its subsidiaries reported on important matters relating to the management situation and the performance of regular business, and have implemented the execution of duties by directors quickly and concretely.
(e) System to ensure the appropriateness of business in the Group
1) Based on the Corporate Code of Conduct of the Group, shall be made to promote compliance became our group together, make the strengthening and education of the compliance system in line with the Group's policy.
2) For the business of management at each subsidiary, as well as planning the annual plan in line with the Group policy, appropriately held a board of directors and make decision on important matters and shall be carried out quickly and specifically the performance of duties by the Directors.
3) Based on the "relationship between company management regulations", we shall be built the system make sure that the subsidiaries are properly operated along the management policy of the parent company while respecting the autonomy of them, and have reported without delay on important matters related to management.
4) Internal Audit department conducts internal audits of its subsidiaries, and reports the results to the Board of Directors of them and the Company's Board of Directors.
5) At the meetings composed of the Board of Directors and responsible persons of each business division and its subsidiaries held at least once a month, we have subsidiaries report about the operation status and the important matters relating to performance of business from time to time attendance upon, and have implement specific measures.
(f) Matters about the employees to assist the Audit & supervisory board members' duties in the case the Audit & supervisory board members have sought to put them, and their independency from the Board of Directors
When Audit & supervisory board members require, and shall put the employees to assist with the duties of them, the employee shall be run in top priority an indication on the them.
It should be noted that when Audit & supervisory board members make appoint of employees, transfer, evaluation, disciplinary, etc., require the consent of the Supervisory Board, it is intended to ensure the independence from the directors of the employees.
(g) Systems for Directors and employees to report to Audit & supervisory board members, another systems for reporting to them, and systems to ensure that the audit of them is conducted effectively
1) Attendance at important meetings
Audit & supervisory board members, in order to grasp the process of the important decision-making and the status of execution of the business, according to the sharing of audit plans and duties the Audit & supervisory board is set, can attend to the meetings of the Board of Directors, the Executive Committee, other important meetings, and listen to duties situation of directors, etc., and view the relevant documents.
2) Reporting requirements of the Board of Directors and employees
Directors and employees of the Group, in addition the case they recognize the matters that may cause significant damage to the Group, the fraud, the articles of incorporation violations or violations of important laws and regulations, the important agenda items and decisions of the conference of Board of Directors, the Executive Committee, and other important conferences, the implementation of internal audit, and other necessary important matters, shall be reported to Audit & supervisory board members on the basis of the laws and regulations and internal rules, and it does not conduct adverse handling to the reporter on the grounds the report.
3) By the independence of the authority, auditors as well as ensure the effectiveness of Audit & supervisory board members, such as consultation and exchange of opinions with Internal Audit department and accounting auditor, promote the achievement of the audit results while maintaining a close cooperation.
4) The cost of Audit & supervisory board members of the auditors shall the Company bear.
(h) System to ensure the reliability of financial reporting
Ensuring the reliability of financial reporting and Evaluation of the effectiveness of internal control based on the Financial Instruments and Exchange Law, and Appropriate submission of internal control report, to build the internal control system.
As well as the evaluation and corrective to this system to function properly and to continue to operate.
(i) System aimed at eliminating anti-social forces
The Group determines the effect on eliminating anti-social forces in the Charter of Corporate Conduct and Ethics Regulations, makes them known to the officers of the Company and its subsidiaries, cut off any relationship with the anti-social forces and organizations to give the order and security of civil society a threat, and reject resolutely against unreasonable request.
(j) System development status to ensure the appropriateness of the subsidiaries' business of the Company
The Company, in order to ensure the appropriateness of the subsidiaries' business, established the "Affiliate Management Regulations", and obliged the Group companies to report sales result, financial status and other management information to us regularly.
In addition, Internal Audit department of the Company, to conduct internal audits of its subsidiaries, and report the results to the Board of Directors of the subsidiaries and the Company's Board of Directors.