The Company has an Audit & Supervisor Board. Audit & Supervisor Board and its members, as an independent organ, audit the directors' performance of their duties. Of the four Audit & Supervisory Board Members, two are outside Audit & Supervisory Board Members, and they sufficiently fulfill the function of external monitoring and supervision of management through recommendations and advice from an objective point of view, based on their knowledge and experience. In addition, the Company endeavors to enhance and improve the effectiveness of supervision of management and the transparency of decision-making by the Board of Directors by appointing more than one highly independent outside director. As these measures have put created a corporate government system to increase the management transparency of the Company and pursue fairness, efficiency and soundness, the Company has adopted the current system.
The Corporate Governance Structure concerning decision-making regarding the company's management and execution, supervision, and the like is as follows:
Board of Directors
The Board of Directors is made up of seven directors. The Board decides on matters required of it as set
out in law and Kanematsu's Articles of Incorporation as well as business policies and other important
matters and oversees business execution by directors. Three of the seven directors are outside directors to
ensure that the Board conducts appropriate decision making and to further reinforce the supervision of
business execution. In principle, the Board of Directors meets once a month, with additional meetings held
as necessary.
Directors are appointed to the Board for one-year terms to allow the Board to respond appropriately to
changes in the business environment. Kanematsu has adopted an executive officer system to improve the
flexibility of business execution, speed up management decision making, and further clarify roles and
responsibilities through the separation of supervisory and executive functions.
Advisory Bodies
To reinforce the objectivity, independence, and accountability of the Board of Directors, Kanematsu has established a Nominating Committee and Compensation Committee as advisory bodies under the Board of Directors.
- Nominating Committee:
Comprises the one outside director as committee chair, the two outside directors and the one director. The committee provides recommendations to the Board of Directors based on deliberations regarding such matters as proposals for the General Meeting of Shareholders related to the appointment and dismissal of directors and the necessary policy, rules, and procedures for reaching related resolutions. - Compensation Committee:
Comprises the one outside director as committee chair, the two outside directors and the one director. The committee provides recommendations to the Board of Directors based on deliberations regarding such matters as policy regarding the setting of compensation levels and types for individual directors and executive officers as well as the necessary policy, rules, and procedures for reaching related resolutions.
Management Committee
To facilitate rapid decision making and flexible management, Kanematsu has set up a Management Committee composed of executive officers, including the president. In principle, the Committee meets at least twice a month. The Committee establishes basic policies for general business execution in accordance with basic policies determined by the Board of Directors and provides instruction and guidance on the execution of business.
Project Deliberation Committee
The Project Deliberation Committee was established to enhance debate and speed up decision making on important projects. The Committee considers and discusses matters from a Companywide perspective and submits recommendations to the designated decision makers for each item before the decision must be made. In principle, the Committee meets at least twice a month.
Audit & Supervisor Board
The Audit & Supervisory Board acts as an independent organ to audit directors' performance of their duties. Specifically, the four Audit & Supervisory Board members, including two outside members, receive reports from directors and employees on the performance of their duties as required, and attend meetings of the Board of Directors, Management Committee, Project Deliberation Committee, Internal Control and Compliance Committee, and other important meetings.
Internal Auditing
To ensure that proper accounting records are kept and to monitor appropriate business execution, Kanematsu has established auditing rules, in accordance with which the Internal Auditing Department conducts internal audits of all divisions and consolidated subsidiaries.