Corporate Governance

The Suzuken Group recognizes the importance of enhancing corporate governance, and its basic policy is to raise the level of trust stakeholders place in the Group by strengthening its management systems, enhancing its compliance framework and raising levels of disclosure and accountability. In doing so the Group intends to work toward its ongoing healthy development as a corporation.

At Suzuken, the Board of Directors is responsible for management oversight and decision-making, and executive officers are responsible for business execution.

Suzuken has terminated its retirement benefits program for executives based on length of service and replaced it with a program of remuneration linked to business performance and contribution. The number of directors has also been reduced. In addition, beginning in June 2005, the term of office for directors has been shortened from two years to one year in an effort to strengthen the accountability of directors in the performance of their duties.

With regard to the management of subsidiaries, Suzuken performs oversight and auditing to ensure executives and employees of subsidiaries are performing their duties appropriately. This is accomplished by deploying Suzuken directors or corporate auditors to subsidiaries and ensuring decisions are reported to Suzuken and approved in accordance with Affiliate Management Regulations. Regular audits of Group companies are also conducted by Suzuken's corporate auditors, Auditing Office and accounting auditors. In addition, Suzuken develops, and provides guidance related to, appropriate systems of internal control based on the nature of each subsidiary.

Suzuken established a Risk Management Committee under its Board of Directors in order to further consolidate the company's compliance framework from a corporate social responsibility point of view. The committee comprehensively manages risk across the organization. It meets once a month to discuss risk management for Suzuken and its subsidiaries.

In addition, the Risk Management Section was established to provide administrative support to the committee in order to ensure the effectiveness of risk management initiatives. In conjunction with this, a corporate ethics hotline was set up as an internal reporting system to enhance the framework for faithfully complying with laws and regulations at Suzuken and its subsidiaries.

Led by the Information Security Office, Suzuken is also developing and strengthening an organized system of information management for the purpose of strictly protecting information, which is a key management resource, minimizing information-related risk, legally complying with the Personal Information Protection Law, and raising awareness of the importance of information among employees.

In addition to expediting results announcements and working to enhance the information provided to investors through its business reports, English-language annual report and website, Suzuken is dedicated to increasing transparency through the proactive, voluntary and timely disclosure of information, going beyond disclosing only what is required by law.

An investor relations section has been established on the company's website and press releases and other information are disclosed in both Japanese and English.

Suzuken's policy with respect to its Ordinary General Meeting of Shareholders is rooted in thoroughgoing accountability. The company views the meeting as the optimal opportunity to present and explain its management policies and initiatives in detail, which it does by giving visual presentations on a large screen and through other means. Suzuken works in this regard to encourage deeper levels of trust and understanding among shareholders.