Governance

Basic Approach

Customer satisfaction is the fundamental starting point of the Group’s corporate activities and earning the esteem and trust of customers makes it possible to achieve sustained growth and profits. The Group recognizes corporate governance as an important task of management for realizing its basic policy of connecting this to higher corporate value and the satisfaction of shareholders and other stakeholders. The Group believes it is important to establish management organizations and internal controls so that sound, transparent decision-making can be conducted quickly. Corporate governance fundamentally is not only compliance with laws and regulations but also consists of promoting business activities that respect corporate ethics, morality, and fairness and developing smooth, disciplined and cooperative relationships with all stakeholders.

Corporate Governance System

  • 1 Advisory Committee

    As advisory bodies to the Board of Directors, the Nomination Advisory Committee and the Remuneration Advisory Committee, which are voluntary committees, have been established to strengthen the supervisory function of the Board of Directors and enhance the corporate governance system by ensuring the transparency and objectivity of the assessment and decision-making process regarding the nomination and remuneration of directors. Each committee comprises at least three directors selected by the Board of Directors, and the majority of members are independent outside directors.

    • ●Nomination Advisory Committee
      The Nomination Advisory Committee deliberates on matters pertaining to the composition of the Board of Directors, appointment and dismissal of directors, and other matters, and reports to the Board of Directors.
    • ●Remuneration Advisory Committee
      The Remuneration Advisory Committee deliberates on matters pertaining to the remuneration structure for directors, policies for determining their remuneration, contents of remuneration, and reports to the Board of Directors.
  • 2 Board of Directors

    Four outside directors (two who are not members of the Audit & Supervisory Committee and two who are members of the Audit & Supervisory Committee) have been invited to sit on the Board of Directors, which meets regularly, and their opinions are sought based on their wide-ranging knowledge and experience in order to further raise the quality and transparency of management decisions and strengthen oversight. The schedule for board meetings is provided to outside directors in advance and their attendance is coordinated.

  • 3 Audit & Supervisory Committee

    Nippon Pillar Packing changed its legal format to a company with an audit and supervisory committee upon approval by the Ordinary General Meeting of Shareholders on June 23, 2017. The Audit & Supervisory Committee comprises three directors who are Audit & Supervisory Committee members (including two outside directors) and is convened on a regular basis. Information and opinions are exchanged among the directors who are Audit & Supervisory Committee members and efforts are made to improve management oversight.

  • 4 Internal Audit Office

    Along with audits by directors who are Audit & Supervisory Committee members, the Internal Audit Office, comprising four members, was established as an organization to conduct internal audits from the standpoint of compliance and efficiency.

  • 5 Security Trade Control Office

    For control of products with export restrictions, we have established the Security Trade Control Office and are taking every possible measure in this area.

  • 6 Committee
    • ●Internal Control Assessment Committee

      The Company has established the Internal Control Assessment Committee in response to the internal control system for financial reporting and conducts internal control assessments for the Group. In addition, internal audits of each subsidiary are conducted on a regular basis.

    • ●ESG/SDGs Promotion Committee

      In April 2021, the ESG/SDGs Promotion Committee was established as a higher-level organization to the CSR Committee to oversee and promote activities related not only to corporate social responsibility but also to the environment, corporate governance, and the SDGs, thereby enhancing the effectiveness of our efforts to achieve sustainable development in harmony with society. The Company publishes an annual Integrated Report summarizing the content of these activities.

    • ●Corporate Ethics Committee

      The Corporate Ethics Committee has been established to ensure compliance with laws and regulations and to improve corporate ethics. We have established the Corporate Code of Ethics as a code of conduct for all employees, and have formulated the Group Code of Conduct as a specific set of standards.

    • ●Crisis Management Committee

      The Crisis Management Committee has been established to ensure rapid response and resolution if a business continuity-related crisis occurs, and a set of Crisis Management Rules have been formulated and other measures taken to prepare in advance for such contingencies.

    • ●Global Environment Committee

      The Environmental Policy has been established to address the development of products that take safety and environmental preservation into consideration. Based on this Environmental Policy, we are working to reduce the environmental impact and maintain and improve our management system.

    • ●Disclosure Committee

      The Disclosure Committee has been established to ensure timely and appropriate disclosure.

  • 7 Strategy Meeting

    The Strategy Meeting discusses strategic issues related to technology, etc.

  • 8 Management Meeting

    The Management Meeting reports and reviews business execution and deliberates on important matters.

Disclosure

Regarding disclosure, Nippon Pillar Packing has established the Disclosure Committee and conducts appropriate and timely disclosure.
To administer our internal control system for financial reporting, which was started in April 2008, we established the Internal Control Assessment Committee and conduct assessments of internal controls at the Group level. In April 2021, we established the ESG/SDGs Promotion Committee as a superordinate organization to the CSR Committee to oversee and promote activities related not only to corporate social responsibility but also to the environment, corporate governance, and the SDGs, thereby enhancing the effectiveness of our efforts to achieve sustainable development in harmony with society. The Company publishes an annual Integrated Report summarizing the content of these activities.
The status of these committees is reported regularly to the representative director.

Risk Management

Nippon Pillar Packing has established the Crisis Management Committee to oversee risk management overall. For risks related to business activities, the Crisis Management Rules have been established and applied to the Company and its Group companies in order to ensure risks are addressed promptly, and a risk management system has been established based on these rules. When unexpected situations arise, a response headquarters is established that is headed by a person appointed by the President, a system is launched to minimize damage and impact, and the situation is quickly addressed. In addition, in order to ensure the timely disclosure of risks and other important information, we established the Disclosure Committee and created a system for conducting timely, appropriate disclosure.

  • Risks that should be managed
  • ●Risks from changes in the semiconductor/LCD markets
  • ●Risks related to quality
  • ●Risks from overseas production/sales and foreign exchange trends
  • ●Risks related to material procurement and price trends
  • ●Risks related to technological development
  • ●Risks related to factory operations
  • ●Risks related to the COVID-19 pandemic

Compliance

In order to strengthen our compliance system, we have established the Corporate Code of Ethics as a code of conduct for all employees. We have also established the Group Code of Conduct as a specific set of standards. Our Group Code of Conduct is presented on our intranet, and we are striving to improve legal compliance and corporate ethics through our internal training system and our Corporate Ethics Committee. In addition, the Global Environment Committee and Environmental Policy were established to ensure safety and environmental protection sufficiently considered in product development. Based on this Environmental Policy, we are working to reduce environmental impact and to maintain and enhance our management system. Furthermore, the Crisis Management Committee has been established to ensure rapid response and resolution if a crisis related to business continuity occurs, and the Crisis Management Rules have been formulated and other measures taken to prepare in advance for such contingencies. Along with this, for control of products with export restrictions, we have established the Security Trade Control Office and are taking every possible measure in this area.

Nippon Pillar Packing subsidiaries are managed through a process that consists of approval and final approval based on the Affiliate Management Rules and reporting from the subsidiaries, but their autonomy as independent companies is also respected, and when there are important managerial matters that occur between Group companies, adequate discussions are conducted. In addition, the Internal Audit Office conducts internal audits of subsidiaries on a regular basis.

As a code of conduct that applies to all Group companies, the Group Code of Conduct as prepared by the Company is posted on our intranet to ensure that all employees are aware of the need to comply with laws, regulations, internal regulations, and social norms.

Tax Policy

The Group will appropriately fulfill its obligation to pay taxes on its business activities, thus contributing to society. We observe the tax laws of countries where we operate and international rules and pay taxes in a timely and appropriate manner in accordance with the laws and regulations.

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