Corporate Governance

The enhancement of our corporate governance is an important issue for the management of our company and we are taking various measures.

Management and Execution Structure

We have adopted a “corporate audit and supervisory committee” system. Currently our Board of Directors consists of a total of 11 executive directors: eight executive directors (excluding Audit & Supervisory Committee members) and three executive directors who are also Audit & Supervisory Committee members. The Representative Director and President serves as the chairperson. At present, 6 of the 11 executive directors are independent outside executive directors.

Important issues must be deliberated by the Board of Directors, and to enhance their deliberation on the development of management policy and other such matters, our Articles of Incorporation provides that the decision on the execution of important business (excluding those provided in Article 399-13, paragraph (5) of the Companies Act), in whole or in part, may be delegated to the Board of Directors.

At our company, all executive directors properly fulfill their roles and responsibilities, thereby allowing the company to make decisions in a flexible manner according to changes in the business environment and ensuring multilateral reviews and objective and transparent decision-making by the Board of Directors. In addition, executive directors who are Audit & Supervisory Committee members have voting rights at Board meetings when deciding on the selection or dismissal of executive directors, the appointment and dismissal of representative directors, and other matters related to the general execution of business (excluding matters the decision on which are delegated to specific directors). The Audit & Supervisory Committee has the authority to express its opinions on the selection of, remuneration to, and other matters concerning executive directors (excluding those who are Audit & Supervisory Committee Members) at a general meeting of shareholders. This has been undertaken to enhance the supervisory function of the Board of Directors over the management of the company.

As for the execution of business, to expedite decision-making, the authority to execute business is delegated to the executive officers responsible for the relevant business and their subordinates in accordance with the relevant decision-making authority rules. Important matters are deliberated and decided by the Corporate Management Committee consisting of the President and other senior management.

Audit System

NSSOL’s Audit & Supervisory Committee consists of one executive director who is a full-time Audit & Supervisory Committee member and two outside directors, including one with considerable knowledge of finance and accounting. We also have the Audit and Supervisory Committee Secretariat (with three members), which is dedicated to providing assistance to the Audit and Supervisory Committee for the performance of their duties.

The Audit and Supervisory Committee conducts audits in accordance with the audit policy and audit plan for each fiscal year to check whether or not directors are performing their duties in a lawful and appropriate manner. The Committee carries out its daily auditing activities in a systematic manner in close collaboration with the Internal Control & Audit Department. The Committee also keeps a close eye on the internal situation of the company by attending meetings of the Board of Directors and Corporate Management Committee, reviewing internal meeting materials, and receiving reports and other materials from each section’s person in charge, conducts document reviews and site inspections using a check sheet based on the important audit matters specified in the audit plan, and works toward the improvement of audit quality.