Basic Policy on Corporate Governance
Sysmex considers reinforcing corporate governance one of its most important management topics. We aim to maximize the overall corporate value of the Group through management robustness, better transparency and improved management speed and efficiency.
Status of Implementation of Corporate Governance Measures
Based on the stance mentioned above, Sysmex has introduced an executive officer system to accelerate business decision-making and reinforce management functions, with the aim of responding more quickly to changes in the business environment.
Sysmex has also adopted the form of a company with an Audit and Supervisory Committee.
■Corporate Governance Structure
Matters Concerning Business Execution, Auditing, Appointments, Supervision and Other Functions
The Managing Board consists of 12 members. The board meets regularly once a month, in principle, to deliberate on important management issues and convenes extraordinary meetings as necessary.
The Global Strategic Committee consists of the chairman and CEO and senior executive officers. As a rule, this committee meets once a month to deliberate on the Group’s management direction and important strategic issues.
The Steering Committee consists of the chairman and CEO and executive officers. The committee meets once a month, in principle, serving as a consultative body to the chairman and CEO to deliberate on important matters concerning the Group’s business. Executive officers also meet approximately once each month to resolve important issues on projects that are operationally important.
In addition, the Group Management Reporting Committee consists of the chairman and CEO, members of the Managing Board, senior executive officers, directors of overseas regional headquarters, people in charge of domestic affiliated companies and division managers. The committee meets once a quarter, in principle, reporting important matters concerning the Group's business execution.
The committee meets once a month to find solutions to cross-functional problems. In the fiscal year ended March 31, 2017, the Managing Board met 16 times, the Global Strategic Committee 13 times, the Steering Committee 15 times, the Group Management Reporting Committee 4 times and the Operating Committee 12 times to address matters relating to management strategy and important issues facing the Group.
The Internal Audit Office, consists of 10 employees, and internal audit offices are in place at key subsidiaries. These offices confirm and evaluate internal controls, the state of management and the execution of business from the perspective of the sound development of the Group, issue reports based on the results of its activities, promote appropriate execution of business through improvements, advice and proposals, and conduct internal audits to contribute to the sound management of the Group.
The Audit and Supervisory Committee has three members, two of whom are appointed as outside members of the Managing Board. Audit and Supervisory Committee members attend meetings of the Managing Board, Global Strategic Committee and Steering Committee, providing a structure that enables the appropriate monitoring of business execution by members of the Managing Board. Based on the content of activities by the Internal Audit Office, the Audit and Supervisory Committee offers a structure to provide instructions to the Internal Audit Office, as necessary. Going forward, the Audit and Supervisory Committee will audit and supervise the members of the Managing Board appropriately in accordance with laws and regulations in the aim of enhancing management soundness.
The Audit and Supervisory Committee will work closely with the accounting auditors on the audit plans report (annual) and the audit results reports (annual), exchanging information and opinions as necessary, such as when conducting internal control audits related to financial reporting.
Basic Policy on Internal Control Systems and Their State of Development
- System for Ensuring the Execution of Duties by Members of the Managing Board and Employees Is Compliant with the Law and the Articles of Incorporation
Sysmex and its subsidiaries (the “Sysmex Group”) define compliance as “the conduct of open and aboveboard business activities on the basis of observance of laws and regulations and high ethical standards” and maintain a system to ensure compliance as described below.
Recognizing that compliance countermeasures are the first and most important way to maintain society’s trust and counter risk, the Sysmex Group operates a groupwide risk management system, under which the Compliance Committee is established as the umbrella organization for compliance. The Sysmex Group has formulated a Global Compliance Code that applies to employees and members of the Managing Board and rigorously ensures compliance through education and training. The Sysmex Group promotes the rapid detection and correction of violations of the law or the Articles of Incorporation by means of an internal compliance-related reporting system, and conducts audits of the compliance structure by means of the Internal Audit Office.
- System for the Retention and Management of Information Related to the Execution of Duties by Members of the Managing Board
The Sysmex Group has formulated Global Document Management Regulations. In accordance with these regulations, the Group appropriately retains and manages minutes of Managing Board and other important meetings, as well as other information relating to the execution of duties by members of the Managing Board, and maintains the information in a state available for inspection as necessary.
- Regulations Concerning the Management of Risk and Other Systems
To maintain a structure concerning risk management, the entire Sysmex Group complies with risk management regulations established by the Risk Management Committee for the integrated management of risk throughout the Group and strives to mitigate risk. The Risk Management Committee endeavors to discover foreseeable risks, select the most important of these risks, clarify the sections responsible for coping with risks, establish countermeasures and confirm the implementation status of these countermeasures.
- Systems to Ensure That Members of the Managing Board Execute Their Duties Efficiently
The Sysmex Group has positioned the Managing Board as the institution to make important management decisions and supervise the execution of duties. The Company has introduced the executive officer system to be capable of making swifter operating decisions and reinforce management functions in order to respond quickly to changes in the business environment.
The Sysmex Group clarifies decision-making procedures and ensures efficient business operations based on organization regulations, scope of authority regulations, regulations concerning the management of affiliated companies, and others. In addition, the Group formulates mid-term plans and annual management plans, periodically confirms the progress made with those plans and takes any necessary measures.
- Systems to Ensure the Appropriateness of Business Activities in the Corporate Group, Comprising the Company and Its Subsidiaries
Sysmex ensures compliance throughout the Sysmex Group in accordance with its Global Compliance Code, which applies to members of the Managing Board and employees throughout the Sysmex Group. In conformance with regulations established with respect to risk management, Sysmex maintains a groupwide risk management system. Internal audit offices are in place at key subsidiaries, and Sysmex’s Internal Audit Office conducts audits of the Sysmex Group as a whole from a regional and companywide perspective.
Based on its regulations relating to the management of affiliated companies, Sysmex respects the autonomy of the management of subsidiaries and other affiliated companies and ensures the appropriateness of business activities throughout the Sysmex Group by such means as periodic reporting on the details of their business activities and advance discussion concerning important matters.
- Assignment of Employees to Assist the Audit and Supervisory Committee
At Sysmex, the Internal Audit Office provides organizational assistance for the duties of the Audit and Supervisory Committee.
When employees at the Internal Audit Office assist the Audit and Supervisory Committee in its duties, they obey the Audit and Supervisory Committee’s orders and instructions.
To ensure the independence of members of the Managing Board (excluding members of the Managing Board who are Audit and Supervisory Committee members), personnel matters involving employees of the Internal Audit Office (including appointments, transfers and disciplinary actions) are discussed in advance with the Audit and Supervisory Committee.
- Policy on Handling Audit Expenses
Sysmex has in place a budget corresponding to the annual audit plan in order to defray the expenses required for the execution of duties by the Audit and Supervisory Committee. Procedures are handled appropriately in the event additional expenses are required for the execution of duties by the Audit and Supervisory Committee.
- Systems Related to Reporting to the Audit and Supervisory Committee and Other Systems for Ensuring Effective and Efficient Auditing by the Audit and Supervisory Committee
If a member of the Managing Board or employee of the Group discovers a violation of the law or the Articles of Incorporation or a material fact that poses risk of causing significant damage to the Sysmex Group, that fact is promptly reported to the Audit and Supervisory Committee according to the prescribed regulations and procedures. Members of the Audit and Supervisory Committee also attend Managing Board, Steering Committee and other important meetings, read important documents such as approval requests, and request explanations from members of the Managing Board and employees of the Sysmex Group as necessary.
Sysmex prohibits dismissal or any other disadvantageous treatment to members of the Managing Board and employees of the Sysmex Group who report information as outlined above.