Basic Concept on Corporate Governance
To meet the "Corporate Governance Code" enforced as of 1 June 2015, we have newly established our basic concept on corporate governance as described below and released them in our Corporate Governance Report.
At the same time, we have disclosed our policies and basic concept on matters such as capitalization strategy, equity based on these policies, information disclosure to shareholders and others, roles and responsibilities of the board of directors and audit & supervisory board, training for directors and auditors, and constructive dialogues with shareholders.
In order to continue to grow and enhance mid to long term corporate value based on our management philosophy, we at TOHO Titanium will strive to strengthen corporate governance by following the basic policies shown below so that we can make fair, transparent, and correct decisions in a prompt manner to execute business appropriately.
1-We shall make efforts to establish an environment in which shareholder rights are respected, substantial equality is ensured, and rights are exercised appropriately.
2-We shall make efforts to collaborate with all stakeholders appropriately.
3-We shall make efforts to ensure transparency by proactively disclosing information not limited to the exposure required by laws and regulations.
4-The board of directors, auditors and board of auditors shall make efforts to fulfill their duties appropriately by:
i-Specifying direction such as corporate strategies
ii-Establishing an environment that supports management executives while taking appropriate risks
iii-Auditing of management officers (including executive officers) and board members in a highly effective manner
5-We shall make efforts to perform constructive dialogue with shareholders to help the company continue to grow and increase mid to long term corporate value.
Corporate Governance Promotion System
Board of Directors
In our company, the board of directors discusses and decides corporate strategies such as company growth strategy and management plans to ensure continued growth and boost mid to long term corporate value. As an environment supporting risk-taking activities of board members, three out of nine directors are outside directors (two of them are independent officers), and two out of three auditors are outside auditors (one of them is an independent officer) among the Board of Auditors, and each of them assumes the role of auditing directors from a specialized, independent and objective standpoint. In this way we have contrived a system that ensures internal control and risk management.
Board of Auditors
Two of our three auditors are outside auditors, and one of them is an independent officer who assumes auditing responsibility from an independent, objective standpoint. Being qualified as an accountant, the independent outside auditor conducts auditing of company's operations and accounts using highly specialized expertise, and states opinions in a proactive and appropriate manner in board meetings. The fulltime auditor is allowed to attend important meetings and access information on internal lecture sessions and reports in our system, and may also access any other information.
Corporate Executive Officer Meeting
We have implemented an executive officer system to enhance the decision-making function of the board of directors and the auditing function and to streamline our business execution. The corporate executive officer meeting is composed of the president & representative director (referred to as president hereafter), executive officers, the fulltime auditor and others appointed by the president. A regular executive officer meeting is held every month and additional meetings are held as needed. In the meetings, the president communicates and provides direction on the policies and matters resolved by the board, and the executive officers report their status in executing company business to the president.
Status of Operation of the Internal Control System
Basic Policies for Building Internal Control System
Toho Titanium Group has prepared and built its internal control system (comprised of the following systems) as described below, and is currently operating it.
System to ensure that duties executed by the directors and employees conform to the laws and articles of the company
System regarding the preservation and management of information related to the execution of duties by the directors
System regarding rules on the management of loss risks
System to ensure that directors execute their duties efficiently
System to ensure that the operation of the company group consisting of the company and its subsidiaries is appropriate
System to ensure that the operation of the company group consisting of the company and its parent companies is appropriate
Matters regarding that person when an auditor requests that a person should be placed in the auditor's assistant position, and matters regarding ensuring the assistant's independence from the directors and the effectiveness of the auditor's direction
System for directors and employees to report to auditors, and system regarding any other reporting to auditors
System to ensure that auditing by auditors not included above should be conducted effectively
Risk Management System
In order to manage all types of risks such as natural disasters, compliance, work safety, and environment, Toho Titanium Group has established "Risk Management Rules" in which basic policies shown below are defined to manage risks.
Risk Management Basic Policies
Ensuring business continuity and steady growth through risk management
Capturing potential risks, and executing measures to avoid or mitigate major risks
Removing or mitigating factors that prevent stakeholders from receiving benefits, with safe operation, product safety, and global environment protection given the highest priority
Sharing and disclosing information on risks and how they are managed
Conforming to rules, such as various laws and regulations, internal codes (such as Toho Titanium Group's corporate ethics rules)
Managing Environmental Risks
Safe operation that causes no environmental accidents is one of the most important issues at our company.
Based on this, we have identified and evaluated environmental risks that can be assumed during our operation in case of an earthquake or water immersion. For high risk matters, we implement improvements based on carefully made plans. By also creating countermeasure manuals for serious environmental accident cases, we make efforts to ensure that we can act appropriately even in case of contingencies.
Responding to Crisis and Emergency Situation
When any crisis or emergency such as a scandal or a severe accident occurs, we follow "Rule of Responding to Crisis and Emergency" to respond in a prompt and appropriate way to minimize the damage.
Responding to Natural Disaster Risks
Implementing Seismic Countermeasures in Chigasaki Plant for Promoting BCP
Chigasaki Plant is implementing its BCP (Business Continuity Plan) including seismic strengthening, to prepare for natural disasters such as earthquakes.