Corporate Governance

Summary of Corporate Governance Structure and Reason for Selection of the Structure

Our vision is that it is crucial to place emphasis on the health, transparency and efficiency of corporate management, as well as to establish a corporate structure that will allow us to respond expeditiously and appropriately to rapid changes in our business environments. By introducing a system of Executive Officers with titles and a division / business division system, we work toward efficient business execution, while we have established the Management Meeting consisting of Executive Directors, including the President, Representative Director, and Executive Officers in order to execute business flexibly and promptly.

The Company Group places the following corporate ideals at the root of its management, making it the starting point for all corporate activities.

Purpose

To Empower Creativity and Excitement Worldwide

Slogans

  • Inspire the Enjoyment of Creativity
  • Be the BEST rather than the BIGGEST
  • The Roland Family – Cooperative Enthusiasm

Mission

Bringing new opportunities to society through digital technology

Vision

Transforming your imagination into reality

Additionally, the Company has also defined the following “Code of Conduct” to conduct business activities in line with the corporate ideals.

Code of Conduct

  • Creation of New Value

    • We will maintain a spirit of creative inquiry to help make people’s lives better by creating innovative value.
    • We will strive harder towards making the company the best rather than the biggest and will work to improve corporate value through the excellence, sustainable business development.
    • We will continually challenge new fields with unrestricted imagination and originality.

  • Global Business Expansion

    • We will constantly pursue new opportunities and engage in business activities with the goal of global expansion.
    • We will respect the diversity in various regions around the globe, including their histories and cultures, and will remain conscious of the importance of harmonious coexistence as we conduct our business activities.
    • We will do our part to conserve the global environment in order to ensure a pleasant society for the people of the world.

  • Clean and Open Corporate Culture

    • Each one of us will remain conscious of social responsibility and will observe laws and social ethics when conducting ourselves.
    • Each one of us will build trust by following our consciences to make fair decisions and by maintaining transparency and accountability.
    • We will create a corporate culture in which everybody can work with enthusiasm and passion. 

Information on Corporate Institutions

The Company adopts an Audit & Supervisory Board Members system. Details of the main bodies of the Company including the Board of Directors are as follows:

  • a. Board of Directors

    The Board of Directors consists of five Directors and meets at least once every month to make decisions on crucial operational matters and oversee the execution of Directors’ duties.

  • b. Management Meeting

    The Management Meeting consists of Executive Directors including the President, Representative Director and Executive Officers, is held typically once every month and supervise the business execution of Executive Officers by having Executive Officers explain deliberation proposals and report on business execution.

  • c. Audit & Supervisory Board Member

    In order to gain an understanding of important decision-making processes and the status of business execution, Audit & Supervisory Board Member also participates in Board of Directors meetings, Management Meetings, and other important meetings within the Company. Audit & Supervisory Board Member also conducts audits on various business locations and subsidiaries in addition to engaging in strengthening its function of monitoring the execution of Directors’ duties.

Other Matters Related to Corporate Governance

  1. a. Status of the internal control system and risk management system

    The Company carries out activities based on the “Basic Policies for Establishing an Internal Control System” which is resolved at the Board of Directors meeting each fiscal year. We have placed the corporate ideals at the foundation of our management, and use them as the starting point for all corporate activities.

    To secure conformity with laws and regulations and the Articles of Incorporation for execution of business by Directors and employees, our compliance structure includes internal education activities on Codes of Conduct, and the whistleblowing system to promote compliance with laws and regulations within the Group.

    The President, Representative Director assumes responsibility for the risk management structure as the Chief Risk Management Officer. The Board of Directors of the Company appoints the Risk Management Officer and the Risk Management Officer supervises and manages the Risk Management System of the Company and reports and proposes to the Board of Directors and the Chief Risk Management Officer on a regular basis. Additionally, a structure is established to receive periodic reports on risk management from subsidiaries, and matters related to the group-wide risk management are treated as risk management issues of the Company.

    Furthermore, to secure the appropriateness of operations of the Group, we have defined “RULES FOR MANAGEMENT OF AFFILIATED COMPANIES”, and while receiving reports on management status from subsidiaries, we supervise the management of key subsidiaries by seconding our Directors, etc., based on the business content and scope of subsidiaries. We secure the appropriateness of operations by placing management advisory bodies at key subsidiaries to deliberate on significant management matters. With respect to the internal control reporting structure for financial reporting as required by the Financial Instruments and Exchange Acts, the management procedures, structure, etc., for development, operation and evaluation of the internal control system are defined, with the Finance & Accounting Department in charge. The evaluation of effectiveness is conducted through evaluation of the status of development and operation in each department and subsidiary, as well as independent evaluation by the Internal Audit Department.

    Apart from the above, the following procedures have been developed to realize appropriate internal control and risk management: a structure to secure efficient execution of duties by the Directors of the Group; a structure related to storage and management of information regarding the execution of duties by the Directors; a structure for the Directors and employees to make reports to Audit & Supervisory Board members; a structure regarding employees to assist the duties of Audit & Supervisory Board Members should they request assistance from such employees; and a structure to ensure that persons making reports to Audit & Supervisory Board Members do not receive detrimental treatment as a result of such reporting.

    Furthermore, we have defined “Basic Views and Maintenance Status Toward Elimination of Anti-social Forces ” with respect to anti-social forces, and under the basic principle of “taking a firm stance and having no relationships, and not conducting any transactions,” we strive to inculcate this to all employees while assigning the General Manager of the Corporate Affairs Department in charge of preventing wrongful requests, and through cooperation with related internal departments, we work to terminate relationships with anti-social forces across the entire company.

    In addition to the above, in order to respond to various legal contingencies, we have in place advisory contracts with multiple law firms with whom we consult and develop solutions to issues as needed.

  2. b. The fixed number of Directors

    The Articles of Incorporation stipulate that the Company shall not have more than ten (10) Directors.

  3. c. Requirements for resolution to appoint Directors

    The Articles of Incorporation stipulate that directors are elected at the general meeting of shareholders and that such election resolutions shall not be made by cumulative votes.

  4. d. The decision-making body for interim dividend

    In order to enable flexible return of profits to shareholders, the Articles of Incorporation stipulate that the Company may, by a resolution of the Board of Directors, distribute interim dividends with a record date of June 30 of each year.

  5. e. Requirements for resolutions at the General Meetings of Shareholders

    The Articles of Incorporation stipulate that resolutions at the general meeting of shareholders shall be made by the attendance of shareholders holding a majority of the voting rights that can be exercised, and by a majority of the voting rights of the attending shareholders.

  6. f. Limited liability agreement with Non-executive Directors

    The Company may enter into contracts, pursuant to Article 427, Paragraph 1 of the Companies Act, with Non-executive Directors to the effect that, if they have performed their duties in good faith and without gross negligence, the liability of the Directors under Article 423, Paragraph 1 of the same law shall be limited. The limited liability amount under such contracts shall be the minimum limited liability amount specified by the same law.

The Status of Internal Audits, Audits by Audit & Supervisory Board Member, and Accounting Audits

    With regard to internal audits, the Company has established the Internal Audit Department as an organization under the direct control of the President, Representative Director, which reports the results of internal control and internal audits of the fiscal year at the meeting of the Board of Directors. Audit & Supervisory Board Member and Internal Audit Department liaise on various matters, such as the development of audit plans, to improve the effectiveness and efficiency of audits. The state of audits by Audit & Supervisory Board Member is described in “c. Audit & Supervisory Board Member” presented in “Information on Corporate Institutions.” Audit & Supervisory Board Member receives explanations of the audit plan and reports of audit results from, and exchange views and information as necessary with, accounting auditors.
    Audit & Supervisory Board Member and Internal Audit department liaise on various matters, such as the development of audit plans, to improve the effectiveness and efficiency of audits.
    Audit & Supervisory Board Member, Mr. Naoki Nagano, has been involved in operations in a financial institution for many years as well as corporate planning and accounting operations in the Company and also has experience as the President of an European subsidiary. He is well-versed in finance and accounting matters.

    While the Company has no vested interest to be stated pursuant to the provisions of the Certified Public Accountants Act with the accounting auditor, Deloitte Touche Tohmatsu LLC, or its engagement partners, the two parties maintain close contact with each other so that the Company is able to receive appropriate advice on an ongoing basis. In addition, overseas subsidiaries of important consolidated subsidiaries are audited (only in accordance with the provisions of the laws and regulations of the country where they are located, which are equivalent to the Companies Act or the Financial Instruments and Exchange Act) by persons other than our accounting auditor (persons with qualifications equivalent to certified public accountants or auditing firms in the country where they are located). Furthermore, the accounting audit for the fiscal year under review was conducted by Certified Public Accountants Messrs. Tadashi Nakayasu and Masanori Toyoizumi who are designated limited liability partners and engagement partners. (As the number of consecutive years conducting audits is within seven years, the number of years is omitted.) Assistance for audit operations is provided by eleven Certified Public Accountants and twenty other persons.

    The Internal Audit department, Audit & Supervisory Board Members, and the accounting auditor hold joint meetings in principle two times a year to execute audits from their respective standpoints in collaboration with each other.

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