Corporate Governance

Corporate organization and internal controlling system

(1) Basic information of corporate organization

We are adopting Board of Auditors’ system and shareholder’s meeting, board of directors and board of auditors are set up as corporate functions, which are regulated in the Company law. We have 4 full-time directors and 2 outside directors, the number of which is suitable for prompt decision-making and business management. All the matters to be resolved by directors, which are regulated in the Company law, are discussed in the board of director’s meeting every month. Also the board of director’s meeting is flexibly held at any time if necessary. Board of corporate auditors is composed of three external auditors. They attend important meetings such as board of director’s meeting and can supervise appropriately with abundant experiences, findings, and experiences about the director’s duty accomplishment. Besides this, the internal auditing office is set up as an internal controlling system, which is not regulated by laws. This is also an internal audit organization of the president, which supervises accomplishment of corporate policies and the whole business activities by cooperating with board of auditor’s meeting and, thus, makes advices and recommendations for the business improvement.

(2) The structure of Corporate Governance

(3) Organizational structure

(Directors and the Board of Directors)

At ADVANEX, the Board of Directors decides on key matters related to the execution of operations. The board comprises 4 full-time directors and 3 outside directors, which we consider an appropriate scale for swift decision-making and dynamic management. The board meets regularly once per month and an ad hoc basis as needed. The board deliberates on all matters related to the fundamental management policies and other matters of importance for the operation of our business. Decisions are made only after due deliberation of such matters.

(Auditors and the Board of Corporate Auditors)

The Company has adopted an auditor’s system. Board of corporate auditors is composed of three members including three external auditors. They participate in the Board of Directors’ meetings and other important meetings and audit the business execution of the Board of Directors and group companies. In addition, the Board of Corporate Auditors works to enhance the effectiveness of the audit process by sharing information and opinions and otherwise maintaining close contact with the Internal Auditing Office and the accounting auditors. The Company has no personal, capital or business relationships or other conflicts of interest with three external Auditors.

(Management meetings)

ADVANEX convenes executive committee meetings once per month for the purpose of deliberating on management issues, reporting, and unifying understanding. Committee members are directors and auditors.

(Internal audit)

We set up the Internal Auditing Office, comprised of two members who report directly to the president and also work for internal audits, under the direct control of the president. In cooperation with the Board of Corporate Auditors and our accounting auditors, this office monitors the implementation of management policies and corporate operations in general, and offers specific advice and points for improvement.
We began to build an in-house control system to comply with Financial Instruments and Exchange Law. We have improved quality of corporation along with reliability improvement of financial reporting, ensuring of transparent and efficiency based on full check, standardization and documentation of business process, and thoroughness of ensuring security based on enhancement of risk control.

(Compliance structure)

To help ensure that all Group employees conduct more highly ethical business activities, the Company has formulated the ADVANEX Group Basic Policies and Ethical Guidelines Concerning Ethics and Legal Compliance, outlining specific behavior guidelines for all executives and employees, both in Japan and overseas, to ensure that they comply with, and abide by the spirit of, all laws and regulations. Also, as part of the corporate ethics program a Corporate Ethics Committee has been established with the aim of spreading and establishing corporate ethics, and preventing problems before they occur.
We set “Basic Policy for Information Security”, provide “Guideline for Information Security” and “Working Rule” of concrete information management and handling rule, and try to eliminate risk of leaks of corporate information and protect IT systems.