Corporate Governance System

Overview of Current Corporate Governance Structure

The company adopts the system of a company with Audit and Supervisory Committee, and appointed five directors (total includes one outside director; directors on the Audit and Supervisory Committee are excluded) and four directors who are Audit and Supervisory Committee members (total includes three outside directors).

The Board of Directors meets at least once a month, and in addition to monitoring and supervising the execution of business by the company, also makes decisions on important matters related to management of the company. Regarding analysis of differences between monthly budgets and actual results, the Board of Directors gives instructions and guidance based on reports toward achieving planned goals.

The Executive Committee, consisting of executive directors, meets at least once a month. The committee discusses the decisions of the President and Representative Director in order to facilitate the smooth execution of business while avoiding excessive concentration of authority.

Additionally, the company has established a Nomination and Compensation Committee as an advisory body to the Board of Directors, and has established a system to further strengthen corporate governance. Specifically, selection of director candidates and distribution of compensation will be determined by a decision of the Board of Directors after deliberation and reporting by the Nomination and Compensation Committee, the members of which include all independent outside directors.

Furthermore, the company has introduced an executive officer system with the purpose of realizing more efficient management and swifter decision-making. Management Committee meetings with executive directors, full-time Audit and Supervisory Committee members, executive officers, etc. are held at least once a month. These meetings are held to report on and discuss important matters relating to management of the company, and to promote mutual understanding of the current state of the management of the company. The contents of these meetings are disclosed and communicated to all employees. The Compliance and Risk Management Committee is composed of executive directors, full-time Audit and Supervisory Committee members, executive officers, etc., and meets when meetings of the Management Committee are held in order to establish systems for compliance and risk management and check progress in this regard.

In March 2022, we established the Sustainability Committee in order to operate our business based on the "realization of a sustainable society" and "improvement of corporate values." In addition, we established the Sustainability Promotion Office as a dedicated department to oversee the group's promotion of sustainability. The Sustainability Committee is chaired by the CEO Representative Director and President and consists of executive directors, full-time Audit and Supervisory Committee members, executive officers, etc. The committee meets semi-annually to discuss a wide range of risks and opportunities, including social and environmental issues related to sustainability, and reflect them in business strategies and policies in a timely manner.

Reasons for choosing the current corporate governance structure

The Company has adopted the Company with Audit Committee System for the following reasons.

  • The Audit and Supervisory Committee, the majority of whose members are outside directors, is responsible for auditing and supervising the legality and appropriateness of business execution.
  • In order to make prompt and decisive decisions, the authority of the Board of Directors to make business decisions shall be delegated to the directors, thereby speeding up management decision-making and execution under the appropriate supervision of the Board of Directors, and creating a system that allows the Board of Directors to focus on discussions of corporate strategy and other issues.

MORESCO Group: Corporate Governance Structure

MORESCO group Corporate Governance Structure figure