Corporate Governance
Basic stance
DENSO believes that establishing a corporate governance system designed to strengthen Group competitiveness is the key to maintaining and improving long-term corporate performance in a quickly changing global marketplace. It is also essential to promoting the corporate social responsibility (CSR) management that is essential for sustainable growth on an ongoing basis. We are working to strengthen our corporate governance in accordance with this belief.
Promotion structure
DENSO Corporation has adopted a corporate auditor system. In addition to statutory bodies such as the General Meeting of Shareholders, Board of Directors, Board of Corporate Auditors and Accounting Auditor, DENSO Corporation has developed various internal control mechanisms. At the same time, we practice sound, efficient and transparent management through the ongoing provision of information about business conditions to shareholders and investors. To expedite the decision-making process and business operations, the Company has appointed supervisory directors (senior managing directors) who are responsible for each business division to link management and production, and has appointed managing officers (30 in total, one-year term) to oversee business execution in each of the Company’s departments.
Roles and results of principal board meetings
Board of Directors
The Board of Directors acts as the decision-making body for management policies and important operational issues. Decisions are made by the chairman based on the collective opinions of all Board members. Instructions deriving from decisions made concerning legal matters and important issues that relate to the entire Group are implemented through the Executive Meeting, and individual directors ensure that the necessary actions are taken in their areas of responsibility by issuing instructions to managing officers or department managers. Attendance by directors and auditors at the 22 Board of Directors meetings held in fiscal 2009 was 93% and 87%, respectively.
Top Management Meeting
The Top Management Meeting is a deliberative body charged with discussing issues to be decided by the Board of Directors and other important issues that have a bearing on overall corporate management (corporate business plans, investment issues, important transaction formats and collaborative projects and other important management matters) and gives direction to corporate policy. Decisions are made by the chairperson after aggregating the opinions of all meeting members and results of the group’s deliberations are reported to the Board of Directors for final decision-making. In fiscal 2009, the Top Management Meeting convened 43 times.
Management oversight function
Two standing corporate auditors and three external auditors with dedicated staff are responsible for monitoring the execution of duties by directors as well as the business operations and financial conditions of DENSO Corporation and its domestic and overseas subsidiaries. Under DENSO Corporation’s audit system, corporate auditors, who implement legally mandated functions, are augmented by departments dedicated to internal auditing (40 persons) at principal domestic and overseas companies.
Corporate auditors monitor and verify the legitimacy, soundness, efficiency and other characteristics of Company operations by attending meetings of the Board of Directors and other management bodies, conducting audits of DENSO departments and domestic and overseas subsidiaries, and regularly holding meetings with personnel from the Legal Department, Finance and Accounting Department, Human Resources Department and Corporate Planning Department. A department responsible for internal audits conducts field audits of DENSO departments as well as domestic and overseas subsidiaries on an ongoing basis. These audits address not only legal compliance but also the suitability of management and operational procedures. Corporate auditors meet monthly with personnel from the department in charge of internal audits and work to improve the quality of the Company’s auditing system.
Accounting audits are conducted in an appropriate and efficient manner in partnership with corporate auditors, the department in charge of internal audits and the auditing firm Deloitte Touche Tohmatsu. They hold regular and as-needed reporting sessions and exchange opinions.
Developing and strengthening internal controls
Starting in fiscal 2009, in order to ensure the reliability of financial reporting, the Financial Instruments and Exchange Law (enacted in June 2006) requires an audit of the internal control reporting system (where companies assess the effectiveness of their internal controls pertaining to financial reporting and have those controls audited by an auditing firm). DENSO Corporation considered this to be an opportunity for developing and strengthening the foundation for sound and sustainable business growth, and we have been working to develop and strengthen the Group’s overall internal controls with the goal of ensuring the reliability of our financial reporting, as well as the effectiveness and efficiency of our operations.
As a result, in fiscal 2009, the first year since these changes, an auditing firm gave our internal controls a fair assessment based on pertinent legal procedures, and we submitted a report on our internal controls to the Financial Services Agency, which determines whether the Group’s internal controls are effective.
●Corporate Governance System
|
