Basic Thinking on Corporate Governance

To remain a company trusted and loved by stakeholders, we must always perform sound and highly-transparent management. The Okamura Group, deeming corporate governance enhancement as one of its top priority issues, works to strengthen its group management structure and its relationships with stakeholders, thereby seeking to maximize its corporate value.
Okamura strives to improve its corporate governance effectiveness and management transparency by disclosing information under Corporate Governance Code (*2) in Corporate Governance Reports submitted to Tokyo Stock Exchange and by disclosing on its official website Corporate Governance Guidelines and Independence Standards for Outside Directors.

Corporate Governance Guidelines

We formulated Corporate Governance Guidelines.
Corporate Governance Guidelines (Japanese Only)(PDF131KB)

Corporate Governance Structure

Okamura introduced an executive officer system in order to keep its management flexible and to strengthen the Board of Directors’ monitoring function. We thus built a system in which Executive Officers execute duties under the direction and orders from the Representative Director. The main role of the Board of Directors is to make important management decisions and supervise execution of duties. In addition, we ensure the objectivity and transparency of appointment of Directors and Executive Officers and remuneration decision processes by putting in place Outside Directors in the Board of Directors and having the Nomination Committee and the Compensation Committee, chaired by independent Outside Directors and mainly composed of independent Outside Directors as a voluntary advisory body to the Board of Directors. Moreover, we have in place a system in which to ensure that duties are executed fairly and efficiently by specifying the responsibilities and authority of individual job titles pursuant to the Segregation of Duties Rules and the Job Authority Rules. The Board of Directors is composed of 12 Directors, including 6 Outside Directors.
Okamura has adopted a board of auditors system and its Auditors strictly audit decisions made by Directors and Executive Officers. The Board of Auditors comprises 4 Auditors, including 2 Outside Auditors.

Corporate Governance Structure Chart

Status of Audits by Auditors

Auditors, while holding a Board of Auditors meeting monthly, in principle, pursuant to the Board of Auditors Rules, conduct audits to see whether duties by Directors are executed appropriately by checking their attendance at important meetings, such as Board of Directors meetings, Executive Committee meetings, and Compliance Committee meetings and by viewing ringi approval documents. Moreover, Auditors work to ensure the effectiveness of audits by exchanging opinions with the Representative Director periodically and collaborating with the Accounting Auditor and the Internal Audit Department.

Collaboration with the Accounting Auditor

Auditors collaborate closely with the Accounting Auditor by receiving reports from the Accounting Auditor on audit plan outlines, priority audit items, audit results, internal audit system, and risk assessment and by exchanging opinions. In addition to attending visit audits and audit reviews by the Accounting Auditor, Auditors require the Accounting Auditor to report on audit processes done as appropriate.

Collaboration with the internal audit unit

Auditors conduct internal audits in collaboration with the Internal Audit Department concerning an assessment of law compliance and the internal control system. Auditors are able to request the Internal Audit Department to conduct audit activities if found to be necessary.

Initiatives on Internal Control for Financial Reporting

Within the Internal Audit Department, the Okamura Group has in place the Internal Control Promotion Office, a unit responsible for internal control assessment, as a response to the internal control reporting system obligating companies to develop a system to secure internal control over financial reporting, have management assess their internal control, and undergo external audits of the internal control under the Financial Instruments and Exchange Act. The unit engages in operations to improve the effectiveness and efficiency of duties and preserves assets as well as maintain and promote internal control to secure the reliability of our financial reporting. We have in place a process owner system in order to clarify who are responsible for the design, building, operation, and maintenance of operational processes of units, as well as roles involved, and to maintain or improve the effectiveness of internal control (operational processing control) for operational processing.

Exclusion of Anti-social Forces

The Okamura Group states in its Code of Conduct and Basic Thinking on Internal Control System that it acts sternly against what are commonly called “Anti-social Forces and Groups” in Japan that threaten the order and safety of citizens’ lives and that the Group excludes any relation to them. The Group, having in place a unit handling relevant matters, gathers and manages information on anti-social forces and provides internal training.

Policy on Tax Affairs

The Okamura Group formulates its tax affairs policy pursuant to the Code of Conduct conforming to its thinking on basic policy and clarifies its governance system and risk endeavors that are intended to pay taxes appropriately in countries and regions where it operates.

Independence Standards for Outside Directors

We formulated the Independence Standards for Outside Directors.
Independence Standards for Outside Directors (Japanese Only)(PDF44KB)

Corporate Governance Report

For the Corporate Governance Report, see the following.