Logo

Governance

Corporate Governance System

Corporate Governance Structures

Corporate Governance Structures

The Oji Group has adopted a COMPANY system under which Oji Holdings oversees the formulation of Group management strategies and Group governance and each COMPANY, made up of closely-related businesses, plays a central role in business operations. This structure accelerates decision making by each business unit and clarifies management responsibilities.
In addition, as a company with Audit & Supervisory Board, Oji Holdings reinforces Group-wide governance through audits of the execution of duties by Directors carried out by the Audit & Supervisory Board Members and the Audit & Supervisory Board. The Board of Directors consists of twelve Directors (including three Independent Outside Directors) and the Audit & Supervisory Board consists of four Audit & Supervisory Board Members (including two Independent Outside Audit & Supervisory Board Members), and Susumu Yajima, Director, Representative Director and Chairman of the Board, chairs the Board of Directors. In FY2019, attendance of Independent Outside Directors and Independent Outside Audit & Supervisory Board Members at the Board of Directors meetings (15 meetings held) was 94.3% and attendance of Independent Outside Audit & Supervisory Board Members at the Audit & Supervisory Board meetings (14 meetings held) was 100%.
The Nomination Committee and Compensation Committee were established as advisory bodies to the Board of Directors.
These two committees enhance the objectivity and transparency of decision making, and the Compensation Committee analyzes the effectiveness of and deliberates on evaluations of the Board of Directors.

Corporate Governance Structures
Corporate Governance Structures

Composition of the Board of Directors

Board of Directors and Audit & Supervisory Board

Purpose of the Board of Directors

Based on its fiduciary responsibility and accountability for shareholders, the Board of Directors performs the following roles to promote sustainable growth and increase medium- to long-term corporate value of the Oji Group, and to improve profitability and capital efficiency.

  • The Board of Directors makes decisions on important items of business execution within the scope prescribed by the Board of Directors Regulations. The important items of business execution include formulation of Management Philosophy and Management Strategy which set forth the direction of the Group as a whole, and execution of investments based on the Philosophy and Strategy.
  • The Board of Directors supports prompt and decisive decisions regarding the issues/matters not pertaining to the Board of Directors’ resolutions, by determining in the Group Regulations the issues/matters that pertain to deliberation by Management Meetings and execution authority of Executive Directors.
  • The Board of Directors performs highly effective supervision of Executive Directors and Corporate Officers from an independent and objective standpoint.
  • The Board of Directors engages in construction of internal control systems, development of risk management systems, and supervision of their operational status.

Composition of the Board of Directors

The maximum number of Directors is 15 in principle, and at least 2 of them are Independent Outside Directors. In addition, 20 Corporate Officers, 9 of whom serve concurrently as Directors, are selected to speed up decision-making, strengthen the business execution system, and clarify executive responsibilities.

The Board of Directors, in order to fulfill a role necessary for achieving sustainable growth of and improvement of corporate value of the Group over the medium to long term, has been organized while giving due consideration to the balance of diverse knowledge and expertise concerning the business of the Group.
There are currently 12 Directors, 3 of whom are Independent Outside Directors (including one female Director). As with the Directors, diversity, a high level of expertise, and a wealth of experience are required for Audit & Supervisory Board Members. Currently, there are 5 Audit & Supervisory Board Members, 3 of whom are Independent Outside Audit & Supervisory Board Members.
The Nomination Committee, which is an advisory body to the Board of Directors, deliberates upon the selection of candidates for Directors and the appointment of Group Corporate Officers before submitting a report to the Board of Directors. Regarding candidates for Audit & Supervisory Board Members, a report is submitted to the Board of Directors after consulting the Nomination Committee and obtaining the consent of the Audit & Supervisory Board. The Nomination Committee consists of 3 Independent Directors, the Chairman, and the President, and the Board of Directors receives the report from the Nomination Committee, deliberates, and makes decisions.

Purpose of the Audit & Supervisory Board

Audit & Supervisory Board Members and the Audit and Supervisory Board conduct operational audits and accounting audits from an independent and objective standpoint, based on their fiduciary responsibility for shareholders.
Audit & Supervisory Board Members and the Audit and Supervisory Board strive to actively exercise their authority through actively combining the advanced information gathering capabilities of Standing Audit & Supervisory Board Members and the strong independence of Independent Outside Audit & Supervisory Board Members while maintaining cooperation with Independent Outside Audit & Supervisory Members.

Composition of the Audit & Supervisory Board

Audit & Supervisory Board is consisting of 4 Audit & Supervisory (including 2 Independent Outside Audit & Supervisory Board Members). Audit & Supervisory Board Members ensures transparency and monitors and verifies management. Audit & Supervisory Board Members attend the Board of Directors and other important meetings based on the audit plan established by the Audit & Supervisory Board to audit Directors’ execution of duties. Nobuko Otsuka, an Audit & Supervisory Board Member, has experience in taxation, accounting and internal audit at a Taxation Bureau, a tax accountant corporation, as well as Oji Holdings Corporation, and has considerable financial and accounting knowledge. And despite the absence of financial experts, Independent Outside Audit & Supervisory Board Members are provided with the training they need to fulfill their individual roles and responsibilities when they are appointed. (Chapter2, Article 14 of the “Fundamental Policies on Corporate Governance”)

Status of Activities by and Reason for Appointment of Independent Outside Officers

Independent Outside Directors and Independent Outside Audit & Supervisory Board Members

Status of Activities by and Reason for Appointment of Independent Outside Officers

There are three Independent Outside Directors and two Independent Outside Audit & Supervisory Board Members at Oji Holdings. All Independent Outside Officers attend Board of Directors meetings, and the briefings that are held twice each month in principle and are conducted by the Director responsible for the Corporate Governance Division regarding Management Meeting agendas and planned Board of Directors deliberation matters. In addition, the three Independent Outside Directors make up the Nomination Committee and the Compensation Committee. Persons with highly specialized and wide-ranging knowledge who are able to express opinions that are independent from management and from the perspectives of various stakeholders are selected as Independent Outside Director candidates, and persons with excellent character and insight, a high level of specialization, and extensive experience are selected as Independent Outside Audit & Supervisory Board Member candidates.
Audit & Supervisory Board Members and the Company’s Internal Audit Department meet once every month to exchange information on audit plans and results, and ensure cooperation between them.
Regarding Independent Directors and Independent Outside Audit & Supervisory Board Members, the content of the Holdings Management Meeting and the Group Management Meeting is reported twice a month, in principle. Through these opportunities, reports and opinions are exchanged in order to form a collaborative relationship.

Main Activities of Independent Outside Officers in FY2019

Main Activities of Independent Outside Officers in FY2019

You can see this table by scrolling horizontally.
Category Name Attendance at
Board of Directors
meetings
Attendance at Audit
& Supervisory Board
meetings
Statements at Meetings
Independent Outside
Director
Michihiro Nara Attended 14 of
15 meetings
(93.3%)
Makes statements from a professional perspective based on extensive experience and wide-ranging knowledge as an attorney.
Independent Outside
Director
Toshihisa Takata Attended 10 of
10 meetings
(100%)
Makes statements based on extensive experience and wide-ranging knowledge as a diplomat.
Independent Outside
Director
Sachiko Ai
(Took office in June 2020)
Independent Outside
Audit & Supervisory
Board Member
Makoto Katsura Attended 14 of
15 meetings
(93.3%)
Attended 14 of
14 meetings
(100%)
Makes statements based on extensive experience and wide-ranging knowledge as a diplomat.
Independent Outside
Audit & Supervisory
Board Member
Mikinao Kitada Attended 15 of
15 meetings
(100%)
Attended 14 of
14 meetings
(100%)
Makes statements based on extensive experience and wide-ranging knowledge as a prosecutor and attorney.
Independent Outside
Audit & Supervisory
Board Member
Norio Henmi Attended 13 of
15 meetings
(86.7%)
Attended 14 of
14 meetings
(100%)
Makes statements from a professional perspective based on extensive experience and wide-ranging knowledge as an attorney.
  • *With regard to Director Toshihisa Takata, only Board of Directors meetings held after he took office on June 27, 2019 are considered.
    In addition, Norio Henmi, Independent Outside Audit & Supervisory Board Member, retired on November 29, 2020.

Nomination Committee and Compensation Committee

Purpose of Nomination Committee

The Nomination Committee deliberates and reports to the Board of Directors on the following issues/matters in order to strengthen the independence, objectivity, and accountability of functions of Directors concerning the nomination of Officers and Corporate Officers by obtaining appropriate involvement and advices from Independent Outside Directors.

  • Nomination policies for candidates for Directors and Audit & Supervisory Board Members
  • Appointment policies for Corporate Officers
  • Nomination of Directors and Audit & Supervisory Board Members, appointment of Corporate Officers
  • Dismissal of Directors, Audit & Supervisory Board Members, and Corporate Officers in cases where they do not satisfy the nomination and appointment policies
  • Succession planning for the Director of the Board, President
  • Appointment and dismissal of Advisors

Purpose of Compensation Committee

The Compensation Committee deliberates and reports to the Board of Directors on the following issues/matters in order to strengthen the independence, objectivity, and accountability of functions of Directors concerning the compensation of Directors and Corporate Officers by obtaining appropriate involvement and advices from Independent Outside Directors.

  • Remuneration system and levels for Directors and Corporate Officers
  • Evaluation of Directors and Corporate Officers
  • Analysis and evaluation of the effectiveness of the Board of Directors
  • Remuneration system and levels for Advisors

Structures of the Nomination Committee and the Compensation Committee and their meetings held in FY2019

You can see this table by scrolling horizontally.
Position Name Nomination
Committee
Attendance Compensation
Committee
Attendance
Director, Chairman of the Board Susumu Yajima   1/1   2/2
Director of the Board, President Masatoshi Kaku Committee Chair 1/1 Committee Chair 2/2
Independent Outside Director Michihiro Nara   1/1   2/2
Independent Outside Director Toshihisa Takata
(Took office in June 2019)
  1/1   1/1
Independent Outside Director Sachiko Ai
(Took office in June 2020)
   

Policy on Determination of Director Compensation and Total Compensation Amount

Policy on Determination of Director Compensation and Total Compensation Amount

Policy on Determination of Director Compensation

Oji Holdings has designed its compensation programs with an emphasis on the roles performed by the Director compensation program such that the Board of Directors promotes sustainable growth and increasing medium- to long-term corporate value of the company and pursues enhanced profitability and capital efficiency. The specifics of the Director compensation program and determination policies are set forth in the Fundamental Policies on Corporate Governance. Director compensation comprises base compensation, bonuses that reflect short-term performance, and stock-based compensation that reflects medium- to long-term improvement in corporate value. Determinations are made by the Board of Directors based on recommendations submitted by the Compensation Committee.
Please refer to the Annual Securities Report for details concerning performance-linked compensation including bonuses and stock-based compensation.

Payment ratios of performance-linked compensation and non-performance-linked compensation

You can see this table by scrolling horizontally.
Position Fixed
compensation
Performance-linked compensation Total
Bonuses Stock-based
compensation
Total
Director, Chairman of the Board 50% 25% 25% 50% 100%
Director of the Board, President 50% 25% 25% 50% 100%
Director of the Board, Executive Vice President 50% 25% 25% 50% 100%
Director of the Board, Senior Executive Officer 50% 25% 25% 50% 100%
Director of the Board, Executive Officer 50% 25% 25% 50% 100%
Independent Outside Director 100% 100%
  • *The payment ratios will fluctuate due to changes in performance-linked compensation such as bonuses and stock-based compensation.

Total amount of compensation for each officer category, total amount of compensation, etc. by type, and number of eligible officers (FY2019)

You can see this table by scrolling horizontally.
Officer category Total amount of
compensation
(million yen)
Total amount of compensation, etc. by type
(million yen)
Number of
eligible officers
(persons)
Fixed
compensation
Performance-linked compensation
Bonuses Stock-based
compensation
Directors (excluding Independent Outside Directors) 654 286 211 155 14
Audit & Supervisory Board Members
(excluding Independent Outside Audit & Supervisory Board Members)
52 52 3
Independent Outside Directors and Independent
Outside Audit & Supervisory Board Members
69 69 6

Policy and Process for Nomination of Directors and Audit & Supervisory Board Members

Policy and Process for Nomination of Directors and Audit & Supervisory Board Members

Policy

At Oji Holdings, the Fundamental Policies on Corporate Governance stipulate as a Director nomination policy that candidates be nominated for Directors who possess excellent character and insight and who may contribute to the sustainable growth as well as the increase of medium- to long-term corporate value of the Group and that candidates be appointed for Audit & Supervisory Board Members who are capable of executing the duties of Audit & Supervisory Board Members, and who possess excellent character and insight as well as high level of specialization and extensive experience.

Process

When nominating candidates for Directors, the Nomination Committee, an advisory body to the Board of Directors, deliberates and recommends to the Board of Directors. As for nomination of candidates for Audit & Supervisory Board Members, the Nomination Committee recommends to the Board of Directors with the consent of the Audit & Supervisory Board, following consultation with the Nomination Committee. The Nominating Committee consists of three Independent Outside Directors, the Chairman and the President, and the Board of Directors receives reporting from the Committee, deliberates and makes decisions.

Directors’ Skill Map

The capabilities of our Directors are as follows:

You can see this table by scrolling horizontally.
Director Corporate
management
Finance and
accounting
Manufacturing
and
technologies
Research and
development
Sales and
marketing
Personnel and
labor
management
Purchase and
procurement
Internationality ESG
Susumu Yajima          
Masatoshi Kaku          
Yoshiki Koseki            
Ryuichi Kisaka            
Kazuhiko Kamada            
Hiroyuki Isono            
Koichi Ishida            
Fumio Shindo            
Shigeki Aoki
(Newly appointed)
           
Michihiro Nara
(Independent
Outside Director)
               
Toshihisa Takata
(Independent
Outside Director)
               
Sachiko Ai
(Independent
Outside Director
/ Newly appointed)