IR Japan Holdings, Ltd.
The Group seeks to improve its corporate value by emphasizing the establishment of good relationships with all stakeholders including shareholders, employees and business partners. To achieve that, the Group believes it is essential to reinforce and enhance its corporate governance, and is making sincere efforts to establish an optimal management and administrative structure to ensure sound, efficient and transparent management.
Pursuant to the Companies Act, the Company has established the general meeting of shareholders, the Board of Directors, the Audit and Supervisory Committee and the Nomination and Compensation Advisory Committee, and has elected directors, audit and supervisory committee members and an accounting auditor. With the aim of holding extensive discussions on such topics as Groupwide strategies, the Company has also established the Management Council and the Group’s Internal Audit Office. In the nomination of directors, the Company employs highly independent outside directors. The Company has adopted the current corporate governance system because it believes the system ensures sound, efficient and transparent management through the oversight functions of such outside directors and collaboration among the above-mentioned organs.
The Board of Directors of the Company, which consists of five directors (including three outside directors), is authorized to determine the Company’s business execution and supervise the directors’ execution of duties. The Company attaches great importance to the presence of outside directors to enhance the shared supervisory function among directors.
The Board of Directors of the Company elects persons as directors who have experience and achievements in the Group, or in the same or similar industry, persons who have experience and achievements in companies of other industries, or persons who have various expertise and abundant experience in finance and accounting or other specialized fields, as skills that they are required in light of our management strategies.
For the Company’s prescribed standards for the election/dismissal of directors, please see Principle 3.1 in the Corporate Governance Report.
Furthermore, considering the various factors including the current size of the Company, active discussions by the Board of Directors and the effective supervision of management expected from outside directors, the Company elects seven directors or less, in accordance with the Articles of Incorporation.
| Management and corporate strategy | Business strategy | Marketing | ESG management | Finance | Global | Legal and risk management | Audits and internal control | |
|---|---|---|---|---|---|---|---|---|
| Shirou Terashita | ○ | ○ | ○ | ○ | ○ | ○ | ||
| Yutaka Fujiwara | ○ | ○ | ○ | ○ | ||||
| Kazufumi Onishi | ○ | ○ | ○ | ○ | ○ | |||
| Nobuyoshi Yamori | ○ | ○ | ○ | ○ | ○ | |||
| Kimikazu Noumi | ○ | ○ | ○ | ○ | ○ | ○ | ○ |
The Company is a company with an Audit and Supervisory Committee, which comprises three outside directors who are audit and supervisory committee members. Using the internal control system, the Audit and Supervisory Committee conducts audits of the execution of duties of directors, as well as other general execution of duties relating to the Group’s business management.
The Company has established the Nomination and Compensation Advisory Committee, which is chaired by an outside director, with the majority of its members outside directors, to serve as an advisory body to the Board of Directors. With this arrangement, the Company ensures fairness and objectivity by consulting the Nomination and Compensation Advisory Committee on the nomination and compensation of directors.
Of the Company’s five designated directors, three are independent outside directors, as are half of the members of the Board of Directors. In addition, because it is extremely important to establish independent and objective procedures when considering particularly important matters such as the nomination of and compensation for directors, the Company has established the Nomination and Compensation Advisory Committee (three of the four members of which are independent outside directors), which is chaired by an independent outside director, to serve as an advisory body to the Board of Directors. Through this establishment, the Company ensures fairness and objectivity by consulting the Nomination and Compensation Advisory Committee on the nomination of and compensation for directors.
The Nomination and Compensation Advisory Committee, as an advisory body to the Board of Directors, deliberates on the establishment, amendment and abolition of basic policy regarding the election/dismissal of directors of the Company and its subsidiaries, as well as the establishment of the compensation scheme, including the formulation of a policy on determining the compensation for directors and important employees of the Company and its subsidiaries. The Committee also deliberates on matters regarding the election/dismissal of directors of the Company and its subsidiaries and the appropriateness of the contents of individual compensation, including the policy for individual compensation, and provides advice and recommendations to the Board of Directors.
The Group convened Management Council meetings comprising the Group’s internal directors approximately once a month until December 2021 (with the December meeting conducted by written report). Extensive discussions on such topics as Groupwide strategies are held at Management Council meetings.
The Company has established the Group’s Internal Audit Office, which is directly supervised by the President and CEO. The Group’s internal audits are conducted by two Group internal auditors who are dedicated to auditing work. As a general rule, the Group’s Internal Audit Office conducts audits of the Company and Group companies once every year with a view toward improving business efficiency, complying with regulations, the growing importance of compliance and a shared supervisory function based on the authorization of duties. Audit results are promptly reported to the President and CEO, while the results and issues for improvement are referred to the Company and Group companies. To increase audit effectiveness, projected plans for remedial actions on those issues must be submitted to the President and CEO, who is responsible for audits.
In nominating outside directors, the Company ensures independence of the candidates and determines that they do not have the possibility of conflicts of interest with general shareholders by complying with the standards prescribed by the Tokyo Stock Exchange, as well as the independence standards for outside directors prescribed by the Company.
The independence standards set by the Company are stated in “Independent Directors,” in the Corporate Governance Report.
| Kazufumi Onishi | Mr. Onishi is concurrently serving as a director (audit and supervisory committee member) of IR Japan, Inc. and Japan Originated Investment Bank, Inc., subsidiaries of the Company, and is well-versed in the Group’s business. In addition, he has abundant achievements and experience as a corporate manager of a subsidiary of a leading advertising agency. Therefore, the Company has elected Mr. Onishi, as it has determined that he is well-suited to rigorously monitor and supervise the Company’s management as well as to provide a broad range of advice and recommendations regarding important managerial judgment and decision making on the management of anticipated risks, etc. While Mr. Onishi originally worked for a business partner of IR Japan, Inc., a subsidiary of the Company, he retired from the company in 2010, and 10 years or more have passed since then. In addition, the volume of transactions with said business partner is extremely insignificant, accounting for less than 1% of the consolidated net sales of both the Company and the business partner, and the Company believes that he is fully independent. Therefore, the Company has designated Mr. Onishi as an independent officer, as it has determined that he meets the independence standards prescribed by the Tokyo Stock Exchange and the independence standards for outside directors set by the Company and there are no potential conflicts of interest with general shareholders. |
|---|---|
| Nobuyoshi Yamori | Mr. Yamori is a specialist in financial theory, corporate governance, ESG finance and related topics. Therefore, the Company has elected Mr. Yamori, as it has determined that he is well-suited to rigorously monitor and supervise the Company’s management as well as to provide a broad range of advice and recommendations regarding important managerial judgment and decision making on the management of anticipated risks, etc. The Company has designated Mr. Yamori as an independent officer, as it has determined that he meets the independence standards prescribed by the Tokyo Stock Exchange and the independence standards for outside directors set by the Company and there are no potential conflicts of interest with general shareholders. |
| Kimikazu Noumi | Mr. Noumi has gained experience through his extensive activities, such as management of the financial business at financial institutions including The Norinchukin Bank, and fostering and supporting the businesses of companies through investment activities, as well as serving as an outside officer at various companies. Therefore, the Company has elected Mr. Noumi, as it has determined that he is well-suited to provide a broad range of advice and recommendations regarding important managerial judgment and decision making on the management of anticipated risks, etc. The Company has designated Mr. Noumi as an independent officer, as it has determined that he meets the independence standards prescribed by the Tokyo Stock Exchange and the independence standards for outside directors set by the Company and there are no potential conflicts of interest with general shareholders. |
During the period from March 2022 to April 2022, the Company conducted an evaluation of effectiveness of the Board of Directors by means of a questionnaire. To ensure the questionnaire’s anonymity, the Company requested a third-party organization to carry out the assessment and received a report of an evaluation conducted based on the questionnaire responses received from 12 directors, including all five directors of the Company, and all 10 directors of IR Japan, Inc. and Japan Originated Investment Bank, Inc., wholly owned subsidiaries of the Company (including three directors who serve as directors of IR Japan Holdings, Ltd. and IR Japan, Inc.; all seven directors of Japan Originated Investment Bank, Inc. concurrently serve as directors of IR Japan, Inc.), as of the time of this evaluation. Questions asked in the questionnaire and the evaluation results are as follows.
(Questions)
A total of 16 questions were asked (including open-ended questions) regarding the following major categories.
(Evaluation results)
The Company received a report that, as in the previous fiscal year, it had practiced management emphasizing corporate governance. The Company is engaged in initiatives toward compliance as its most important task, as indicated by the comments of outside directors, to the effect that compliance adherence is shown by the awareness and behavior of the executive side. In addition, by conducting meetings in a manner that allows outside directors to actively express their opinions, the Board of Directors was operated in full consideration of the effective supervision of management by outside directors.
On the other hand, as future issues for deliberation, the report noted the method of discussing sustainability issues as well as the method of sharing the policy for training successors to the representative director as topics for more in-depth deliberation, along with deliberations on improving the timing for distributing materials for Board of Directors meetings and the method of holding pre-meeting briefings.
Considering the above evaluation results, the Company will continue to make further efforts in improving the corporate governance system to enhance its corporate value.