Basic Concept on Corporate Governance
To meet the "Corporate Governance Code" by Tokyo Stock Exchange, we have designed our basic concept on corporate governance as described below and have 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, information disclosure to shareholders and others, roles and responsibilities of the Board of Directors and Audit Supervisory Committee, training for directors(including Audit Supervisory Committee members), and constructive dialogues with shareholders.
In order to continue to grow and enhance medium to long-term corporate value based on our management principle, 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 and Audit Supervisory Committee 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 medium to long-term corporate value.
Corporate Governance System
Board of Directors
Board of Directors discusses and decides corporate strategies such as company growth strategy and management plans to ensure continued growth and boost medium to long-term corporate value. For proactive and unbiased decision by board, 5 out of 12 directors are outside directors (4 of them are independent directors) 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.
Audit Supervisory Committee
Two of three the committee members are independent outside directors. They conduct audits from an independent, objective standpoint. The committee includes a certified public accountant and committee members audit company's operations and accounts using highly specialized expertise. They state opinions in a proactive and appropriate manner in board meetings. The fulltime committee member can attend important meetings and access any information on internal lecture sessions and reports.
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 committee member and others appointed by the president. Regular executive officer meetings are 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 Policy on Establishment of Internal Control System
Toho Titanium Group has Basic Policy on Establishment of internal control system as described below, and is currently executing it.
System to ensure execution of duties of the directors and employees is in compliance with laws, regulations and articles of incorporation
System regarding the preservation and management of information related to the execution of duties of directors
Rules and other frameworks regarding management of risk of losses
Frameworks to ensure efficient execution of duties of directors, executive officers and employees
Frameworks to ensure proper operations by the corporate group
Frameworks to ensure effectiveness of audits by Audit Supervisory Committee
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 Framework" which has below basic policy to recognize and control risks.
Basic Policy of Risk Management
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 could be happened during our normal operation or under severe natural conditions. 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.
Upgrade of BCP (Business Continuity Plan)
Toho has designed BCP considering specific risks for each business site, such as earthquakes, tsunamis, floods etc.