At Nitta, we believe the fundamental mission of corporate management entrusted to us by our shareholders is to pursue sustained growth and medium-to-long-term improvement in corporate value through fair business activity. Additionally, we have obligations to shareholders and other stakeholders, which encompass employees, business partners, customers, local communities, and the global environment.
We recognize that, in order to execute corporate management consistent with this way of thinking, we must have in place a system of corporate governance, which facilitates such key functions as prompt and precise decision-making, greater business transparency, better information disclosure and IR, and more robust risk management, including compliance systems. Thus, we are continuously pursuing management system innovation and other initiatives that will strengthen and enhance corporate governance at Nitta.
Corporate Governance Policy
(1) Overview of Governance Structure
Nitta is structured as a company with an Audit & Supervisory Board so as to facilitate the ability of the Board of Directors to perform proper business management while the Audit & Supervisory Board carries out management oversight.
In order to ensure these functions are fully realized, multiple outside directors are appointed who are capable of providing an independent perspective on business execution. Outside Audit & Supervisory Board members are drawn from multiple fields and appointed as half of the Audit & Supervisory Board so as to facilitate multifaceted oversight. In this way, we have a broad spectrum of experience and expertise from which to obtain advice and ideas, as well as a system of corporate governance providing both excellent business transparency and integrity.
We have also adopted an executive officer system that separates decision-making (Board of Directors) from business execution in order to ensure both appropriate business management and efficient business execution.
In addition to all of this, we have established a Management Council comprised of full-time directors and executive officers who deliberate on important management issues in order to assist the president with business execution.
(2) Directors and the Board of Directors
- 1. Roles of the Directors and Board of DirectorsIn order to facilitate the establishment and realization of corporate management strategies, policies, and targets, the Board of Directors is vested with the authority and responsibility to perform concrete planning, stipulate basic matters for overall management, and put forward resolution measures for internal issues, as well as the authority to oversee the performance of the representative director and other directors and executive officers, and the obligation to pursue all duties fairly.
- 2. Director Number and Term of OfficeThe number of directors is limited to nine, including three outside directors, in order to facilitate prompt and appropriate decision-making and the fulfillment of the full scope of responsibilities held by the Board of Directors.
Directors serve for one year and are eligible for reappointment upon conclusion of their term of office.
(3) Audit & Supervisory Board and Board Members
- 1. Roles of the Audit & Supervisory Board and Board Members The Audit & Supervisory Board seeks to carry out the duties required of it by the Companies Act and to serve as an objective observer over company management. Towards that end, full-time Audit & Supervisory Board members attend Board of Directors meetings, Management Council meetings, and other important meetings and perform compliance and legality-related auditing of the company’s business execution. In addition, outside Audit & Supervisory Board members ask questions regarding the legality of company decision-making at the Board of Directors meetings. They also render their own opinions on these matters.
- 2. Audit & Supervisory Board Member Number and CompositionThe number of Audit & Supervisory Board members is limited to four in order to facilitate accounting and operational audit effectiveness. At least half of this number are outside Audit & Supervisory Board members.
- 3. Audit & Supervisory Board Member Assistance SystemIn order to assist Audit & Supervisory Board members in their duties, Nitta has established a system comprised of dedicated support staff led by the Audit & Supervisory Board.
Additionally, the appointment and transfer of this support staff are determined in advance in consultation with the Audit & Supervisory Board in order to ensure the independence of the staff from directors and to ensure their effectiveness in carrying out tasks as directed by Audit & Supervisory Board members.
(４) Outside Directors and Outside Audit & Supervisory Board Members
- 1. Outside Directors and Outside Audit & Supervisory Board Members Nitta appoints outside directors who are able to offer a wide range of experience and expertise in different fields and specializations, which can be utilized in managerial decision-making and who can assess the appropriateness of the company’s business execution from a fair and impartial standpoint.
Moreover, with regard to the standards for independence of outside directors, Nitta follows the criteria for outside director independence stipulated in the 2010 Exchange Guidelines for Listing Management, as well as the attribute information from the 2012 Revised Exchange Listing Rules. However, with regard to the appointment of outside directors, Nitta has established simple in-house standards.
- 2. Overview of Limitation of Liability AgreementsNitta maintains agreements with outside directors and Audit & Supervisory Board members, which are based on the stipulations of Paragraph 1, Article 427 of the Companies Act and which limit liability for compensation as well as the amount of liability compensation, as per the stipulations of Paragraph 1, Article 423 and Paragraph 1, Article 425, respectively, of the Companies Act.
Corporate Governance Report
Nitta posts its Corporate Governance Report on the website of the Japan Exchange Group. Please feel free to read it in conjunction with the report available below.