Basic Approach to Corporate Governance
In accordance with the KOKUSAI ELECTRIC Way corporate philosophy, we continuously work to enhance corporate governance to enable fast and decisive decision-making based on appropriate risk-taking, in order to strengthen the trust of stakeholders including shareholders, investors, business partners, and employees.
To strengthen the supervisory function of the Board of Directors and ensure flexible decision-making by executives, we have adopted an Audit and Supervisory Committee company system. Accordingly, half of the Directors are independent Outside Directors with extensive expert knowledge, and Executive Officers delegated by the Board of Directors execute business based on basic policies and other matters approved by the Board of Directors. In this way we keep supervisory and executive functions as separate as possible. Furthermore, to ensure the effectiveness of corporate governance and transparency of procedures, decisions on the appointment and dismissal of Directors and Executive Officers, successor plans, and remuneration require advance consultation with the Nomination and Remuneration Committee, which is made up mostly of independent Outside Directors. In addition, transactions with controlling shareholders and other parties require advance consultation with the Transactions with Controlling Shareholders Committee, which is made up only of independent Outside Directors.
Corporate Governance Chart
Independence Standards of Independent Directors
KOKUSAI ELECTRIC CORPORATION (hereinafter referred to as "KE") has established "Independence Standards of Independent Directors" as follows:
KE will determine its independent directors to be persons who meet the requirements for outside directors prescribed by laws and regulations and the independence criteria set by securities exchanges, and who do not fall under any of the following items.
- (1)
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An officer or employee of KE Group (including who was an officer or employee of KE Group in the past).
- (2)
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An officer or employee of an entity, etc. which is a major client of KE Group (meaning a client which exceeds 2% or more of KE Group's consolidated net sales in any of the past three business years).
- (3)
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An officer or employee of an entity, etc. for which KE Group is a major client (meaning a client for which KE Group exceeds 2% or more of such client’s net sales in any of the past three business years).
- (4)
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A provider of professional services (meaning consultants, accounting professionals, or legal professionals, etc.) who has received 10 million yen or more in money or other assets from KE Group in addition to their remuneration as a director or company auditor in any of the past three business years, or if such provider is an entity, etc., an officer or employee, etc. of such entity, etc. who has received 10 million yen or more and 2% or more of such entity, etc.'s total revenue from KE Group in addition to their remuneration as a director or company auditor in any of the past three business years.
- (5)
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The largest shareholders of KE (meaning shareholders who directly or indirectly hold 10% or more of the total number of issued shares of KE) or if such largest shareholders are entities, etc., officers or employees of such entities, etc.
- (6)
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A person who has received a donation of 10 million yen or more from KE Group, and/or an officer or employee of an entity that has received a donation of 10 million yen or more from KE Group.
- (7)
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A close relative (meaning a relative by blood within the second degree of kinship or a person with a similar degree of personal relationship) of a person who meets any of the above items (excluding unimportant persons).
- (8)
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Any other persons who KE determines to have a significant relationship of interest with KE Group.
