AISIN AW CO.,LTD.
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Corporate Governance

For higher corporate values, Aisin AW believes it is important to build an amicable relationship with our stakeholders and provide our customers with satisfactory products.

Basic approach

In a challenging business environment brought on by rapid globalization, increasing our corporate competitiveness becomes even more imperative for long-term stable growth. Accordingly, we make every effort to improve our corporate governance by implementing various measures.

System

In order to increase our business transparency while also satisfying prompt decision making, operation-speed ups, and social responsibility, we have implemented a unique management system. Also, we have adopted Operating Officer System, a system which board of directors and executing tasks are managed by small number of people. In addition, we have created various types of committees such as the "Business Ethics Committee", "Central Safety and Health Committee" and "Export Trade Management Committee" for monitoring our business with the perspectives of both internal and external stakeholders in mind.

Corporate Governance Structure

Corporate Governance Structure

Internal Control

In conjunction with the implementation of the Companies Act, Aisin AW organized the basic course of action regarding the establishment of internal control in June 2006 and has since been promoting projects related to this policy. In addition, part of the Policy was reviewed in December 2009 for further improving the accuracy and reliability of our financial reporting and the appropriateness of our subsidiary operations. In April 2013, by adopting Operating Officer System, part of the Policy was reviewed. In May 2015, part of the Policy was reviewed with the enforcement of amendments to the Companies Act, etc.

Basic Policy Concerning the Establishment of Internal Control

1. System for ensuring that the execution of duties by Directors complies with laws and the articles of incorporation.

Based on the Company's corporate principles and Principles of Corporate Behavior, Directors shall work to maintain systems to ensure compliance with laws and the articles of incorporation.

  • (1) During training upon appointment of Directors to their positions and at other relevant times, we shall thoroughly train Directors to act in accordance with laws and the Articles of Incorporation by using guidebooks and other materials that address corporate behavioral ethics and the legal knowledge necessary for Directors.
  • (2) In executing tasks, Directors shall make decisions upon comprehensive deliberation not only in the Board of Directors and the Executive Committee, but at all manner of committees, councils and other cross-organizational meetings.
  • (3) We shall establish a committee on corporate behavioral ethics, which shall deliberate on and determine policies and systems for legal and corporate ethics compliance.
2. System for storage and management of information regarding execution of duties by Directors.
○ Information regarding execution of duties by Directors shall be appropriately stored and managed by each responsible department, based on relevant regulations and laws.
3. Regulations concerning management of the risk of loss, and other systems
  • (1) All necessary rules, education/training programs, and reporting systems are reviewed and revised for risk management purposes. Based on these programs and systems, we shall take precautions to prevent risks, and respond to any crisis that should become apparent.
  • (2) Identify risk in business processes, maintain written records and regularly evaluate implementation status of internal control activities in order to ensure accuracy and reliability in financial reporting.
4. System for ensuring efficient execution of duties by Directors.
  • (1) We shall carry out consistent policy management by making concrete policies at each level of the organization on the basis of medium-term management plans and yearly corporate policies.
  • (2) Within our officer system, Directors and Operating Officers (meaning Senior Managing Officers, Managing Officers, Officers; the same shall apply hereinafter) shall direct and supervise executive officers based on management policy and grant them executive authority within each department in order to exercise agile decision-making.
5. System for ensuring that the execution of duties by employees complies with laws and the articles of incorporation.
  • (1) Based on the policies of the committee on corporate behavioral ethics, employees shall be thoroughly trained in compliance matters via distributed guides on corporate ethics and through legal education and education at each management level.
  • (2) We shall ensure that information that addresses issues and questions regarding compliance matters is quickly obtained through corporate ethics consultation contact point and other services, so that such matters are understood and resolved early on.
  • (3) We shall carry out on-site audits by an internal auditing department.
6. System for ensuring the appropriateness of tasks in the corporate group consisting of the joint-stock company and its parent company and subsidiaries
  • (1) Based on the common basic principles of the Group and the Principles of Corporate Behavior, we shall work to maintain systems to ensure compliance with laws and the Articles of Incorporation, and ingrain those systems through human interaction.
  • (2) We shall place subsidiary management functions within the corporate planning department, and work to ensure the appropriateness of each company's business activities by ascertaining each company's planning and results pertaining to such activities.
  • (3) We shall provide advice and support toward maintaining systems for ensuring information distribution to each Group company and the appropriateness of its business activities, though meetings as a corporate group and information sharing among each functional department on both a periodic and an as-needed basis.
  • (4) Subsidiaries shall make a periodic report of important matters of management and submit necessary documents.
  • (5) We shall provide directions and support for reviewing and revising all necessary rules, education/training programs, and reporting systems for risk management purposes at subsidiaries. In addition, we shall make subsidiaries report assessment results of prioritized risks which may occur and the risks which have happened.
  • (6) We shall monitor the appropriateness of operating subsidiaries' operations through the Internal Auditing Department and other internal organizations.
7. System concerning employees appointed to assist Audit & Supervisory Board Members with their duties by their request.
○ A full-time staff to assist Audit & Supervisory Board Member's duties shall be in place.
8. System for independence of employees indicated in preceding paragraph from Directors and appropriateness of directions given by Audit & Supervisory Board Members
○ When selecting staff members to assist Audit & Supervisory Board Members with their duties, prior consent shall be obtained from the Audit & Supervisory Board Members.
9. System for reporting to Audit & Supervisory Board Members.
  • (1) Directors shall report to Audit & Supervisory Board Members on the execution of main tasks via the departments responsible in a timely and appropriate manner, and shall immediately report to Audit & Supervisory Board Members upon discovery of any fact that could cause significant harm to the company.
  • (2) Directors, Operating Officers, and employees shall make a business report to Audit & Supervisory Board Members on a periodic and as-needed basis, as per requests by the Audit & Supervisory Board Members. In addition, Directors of subsidiaries shall make a business report if necessary.
10. System for those who make report as in preceding paragraph shall not be treated unfavorably
○ We shall ensure an appropriate action for those who make report to Audit & Supervisory Board Members so that they shall not be treated unfavorably.
11. System for ensuring the expenses incurred associated with the duties of Audit & Supervisory Board Members
○ We shall bear expenses required for duties of Audit & Supervisory Board Members.
12. Other systems for ensuring effective performance of audits by Audit & Supervisory Board Members
  • (1) To enhance the effectiveness of audits performed by Audit & Supervisory Board Members, and Directors shall actively cooperate in their audit activities, including Audit & Supervisory Board Members' attendance at important meetings, review of important documents, activities of on-site audits of plants and subsidiaries, and meetings with accounting auditors.
  • (2) The internal auditing department shall interface closely with Audit & Supervisory Board Members and report to them the results of internal audits.
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