Corporate Governance

1. Basic Concepts Regarding Corporate Governance

We recognize the importance of corporate ethics based on compliance with laws and regulations, etc., and consider the increasing of shareholder value through expediting of managerial decision making in accordance with changing social and economic environments and improvement of soundness of management to be an important theme.

To realize the above, we shall build up good relationships with all stakeholders including our shareholders, customers, suppliers, local communities, employees, etc., and shall substantiate corporate governance while further strengthening the current organization of the General Meeting of Shareholders, Board of Directors, Audit and Supervisory Committee, Accounting Auditor, etc.

For our shareholders and investors, we shall make efforts to provide prompt and accurate information disclosure and improve managerial transparency through broad disclosure of information.

 

 

2. Corporate Governance System

Outline of the Corporate Governance System

We have established a Board of Directors that includes external directors, and its members supervise business operations by directors and executive officers. We have adopted a system as a company with an Audit and Supervisory Committee. Also, to further strengthen corporate governance and the supervisory function of the Board of Directors over Management and to improve soundness and efficiency of management. On the other hand, an executive officer system helps to accelerate the execution of business operations.

Moreover, we have assembled a Management Committee that consists of internal directors and executive officers, and its members deliberate on matters that involve prior deliberations and important decisions to be made in the course of the execution of business operations, out of matters to be determined by a resolution of the Board of Directors. The Management Committee takes place once a month in principle; however, extraordinary meetings are held as necessary.

 

Status of the Board of Directors

Yaskawa’s Board of Directors consists of a total of eleven directors with eight internal directors and three external directors.

The Board of Directors holds regular meetings of the Board of Directors and, if necessary, extraordinary meetings of the Board of Directors to decide important matters related to business and matters required by laws and regulations. The Board of Directors also continuously monitors the status of the execution of business operations. For clarifying management responsibility and to promptly responding a rapidly changing business environment, a term of director’s assignment is set at one year.

In FY2015 (fiscal year ended March 2016), the Board of Directors held 13 meetings of the Board of Directors to decide important matters related to business and matters required by laws and regulations, and the Board of Directors also monitored the status of the execution of business operations. Besides the above, it should be noted that pursuant to the provisions of the Companies Act and Yaskawa’s Articles of Incorporation, there was one written resolution which was deemed to be a resolution of the Board of Directors.

We have appointed Yoshiki Akita, Kazumasa Tatsumi and Yasuto Tanaka as external directors, and expect them to contribute to ensuring legal compliance by observing the company from the standpoint of investors, customers and the general public. During deliberations at the meetings of the Board of Directors, external directors after having fully grasped the current circumstances of the company based on information that is addressed or reported by internal control divisions, internal audit divisions, head office divisions and the Accounting Auditor, provide recommendations, etc., using their respective knowledge, thus serving as an appropriate supervisory function.

 

Status of the External Directors

Name

Status of Concurrent Positions

Reason for Appointment

Yoshiki Akita

Chairman and Representative Director, Layers Consulting Co., Ltd.
External Director, Bell-Park Co., Ltd.

He has been judged to be able to make use of his abundant experience and knowledge that he has gained as a certified public accountant and as a representative director of a consulting firm to contribute to the management of Yaskawa Electric.

With regards to the independency, since he has no business relationship with Yaskawa nor does he act as a person who executes the business operations of any major shareholder, he does not fall under the independence related items set forth by the financial instruments exchange.

Kazumasa Tatsumi

Attorney and President, Kazumasa Tatsumi Law Office

Izutsuya Co., Ltd. External member of the Audit and Supervisory Committee

He has been judged to be able to make use of his expert knowledge and experience that he has developed as an attorney to contribute to the management of Yaskawa Electric.

With regards to independence, since he has no business relationship with Yaskawa nor does he act as a person who executes the business operations of any major shareholder, he does not fall under the independence related items set forth by the financial instruments exchange.

Yasuto Tanaka

Director, Executive Managing Corporate Officer, Krosaki Harima Corporation

Head Office Division (Labor & purchase, finance, general affairs, risk management, planning) Administrator

He has been judged to be able to make use of the experience that he has developed while holding directorial posts in the administrative department and sales department of a business corporation to contribute to the management of Yaskawa Electric.

With regards to independence, since he has no business relationship with Yaskawa nor does he act as a person who executes the business operations of any major shareholder, he does not fall under the independence related items set forth by the financial instruments exchange.

Status of Audit and Supervisory Committee

The Audit and Supervisory Committee is comprised of five directors (three of whom are external directors) who are members of the Audit and Supervisory Committee.

In FY2015 (fiscal year ended March 2016), the Audit and Supervisory Committee held 10 meetings after our organizational transition to a company with an Audit and Supervisory Committee.

In performing audits, the Audit and Supervisory Committee ascertains the current circumstances of this company sufficiently based on information reported from internal control divisions, internal audit divisions, and head office divisions, and the internal directors conduct inspections while carrying out their duties appropriately. Further, duties are performed in collaboration with the Accounting Auditor and the duties of the Accounting Auditor are monitored and verified.

Ernst & Young ShinNihon LLC has been appointed as the Accounting Auditor and under the audit contract, we provide accurate business information and have prepared an environment where audits are performed from an independent standpoint.

 

Status of Nomination Advisory Committee and Remuneration Advisory Committee

For directors, we have established a Nomination Advisory Committee that serves as an advisory body for the president. This is to ensure transparency and fairness in the process of nominating candidates for directors and selecting Representative Directors and executive directors, and to ensure that external directors who are members of the Audit and Supervisory Committee are given sufficient information to form opinions about the nomination of officers, etc., and that opportunities to discuss such issues are provided.

When a proposal concerning the nomination of officers, etc., is addressed at the meeting of the Board of Directors, the content of the report that has been provided by this Committee is sufficiently reflected. For remuneration of directors (excluding those who are members of the Audit and Supervisory Committee) and executive officers, we have established a Remuneration Advisory Committee that serves as an advisory body for the president. This is to ensure appropriateness and transparency through fair deliberations and to ensure that external directors who are members of the Audit and Supervisory Committee are given sufficient information to form opinions about such remuneration, and that opportunities to discuss such issues are provided.

Upon the President’s request for opinions, from the standpoint of appropriateness, this Committee deliberates on the amount of remuneration for officers that has been calculated based on the Officer Remuneration Regulations, etc., and on other necessary matters in connection with such remuneration, and reports its opinions to the President.

 

Corporate Governance System

 

Internal Control System

Through the Internal Control System, preparation and maintenance regarding the Articles of Incorporation, information disclosure policy, risk management systems, division of duties, operational authority, group company management, etc., are performed to ensure that appropriate and efficient administration of business operations is carried out by the Board of Directors, the Management Committee, etc. The basic policy of the Internal Control System is decided and revised whenever necessary by the Board of Directors that includes external directors of a high degree of independence.

Also, with regard to norms for corporate activities, compliance and enlightenment of these norms are being promoted within the company and group companies including subsidiaries, with the development and promotion of a compliance system through the “Group Principle of Management” and the “Guidance on Yaskawa Group Code of Conduct.” In addition, we have established the “Basic Regulations for Group Compliance” in order to maintain the compliance system, and have also established a whistle-blowing system “Compliance Hot Line” for this company and each group company.

 

Risk Management System

In constructing a risk management system within the Yaskawa Group, we have established a Compliance Committee that aims to achieve compliance and enlightenment, and system fortification and promotion of the “Guidance on Yaskawa Group Code of Conduct,” and a Risk Management Committee for policy formulation and promotion, management system follow-up, and enlightenment of awareness regarding risk management. Furthermore, the basic policies for day-to-day preparedness and emergencies within the Yaskawa Group are clearly set out based on the “Basic Regulations for Risk Management.”

Also, in cases requiring legal decisions, we discuss with and receive advice from corporate lawyers.

 

Report on Corporate Governance

 Report on Corporate Governance (renewed on June 17, 2016) (Japanese only)

 

 

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