Corporate Governance

Cedyna and its subsidiaries consider internal control systems, including the establishment of an internal management system, to be a primary management concern. As such, and with the aim of increasing corporate value, the Group has been working to fulfill its responsibilities in this area through such measures as abiding by laws and regulations, maintaining operational efficiency and enhancing management efficiency through effective use of management resources.

To this end, in accordance with the Companies Act, Article 362, Paragraph 5, Cedyna has formulated a basic policy deemed necessary for the implementation of internal control systems, as stipulated by the Companies Act, Article 362, Paragraph 4, Item 6 and by the Ordinance for Enforcement of the Companies Act, Article 100.

The Board of Directors is composed of thirteen directors (including three outside directors), and meets regularly once a month and, when necessary, in extraordinary session. Both matters required by law and issues relating to the business are submitted to the Board for discussion. The outside directors provide observation and supervision with their rich experience and highly-regarded opinions as managers of businesses, as well as advice pertinent to the management of the business. Of the outside directors, one is designated as an independent director.

Cedyna adopts an auditing committee system, and the Auditing Committee consists of five corporate auditors (of whom three are outside corporate auditors). The auditors fulfill their auditing duties by hearing oral reports from the directors and inspecting important documents for approval at the various main committee meetings it attends. Such meetings would include: meetings of the Board of Directors; fortnightly management meetings where core issues are deliberated on; weekly executive meetings where core issues are reported on; quarterly Internal Control Committee meetings, where matters of internal control are communicated as per the Basic Internal Control Policy stipulated by the Board of Directors; and monthly Compliance Committee meetings in which compliance matters are communicated as stipulated in the Basic Internal Control Policy. All the outside corporate auditors are designated as independent directors.

In addition to attending the above meetings, the corporate auditors hold regular meetings with the Directors and accounting auditors, and strive for timely and appropriate communications through offering and sharing information. They also regularly receive reports from the Internal Audit Unit, among others, and work to enhance communications by seeking further investigation where necessary.

The internal audit function is carried out by a structurally independent Internal Audit Unit, which robustly conducts its audits, including audits of affiliated companies, from a variety of perspectives including internal controls, risk management and compliance. Reporting to the President and Representative Director, the unit works to improve its coordination with the auditors by providing them with information and assisting them in other ways, thereby improving management transparency.

The auditors work to coordinate their activities based on their auditing policies, by such means as attending meetings of the Board of Directors and other core meetings, receiving oral reports from the Directors and other sources, inspecting important documents of resolutions, and exchanging information and opinions with the independent auditors, enabling them to observe and verify the provision and status of internal control.

With the aim of strengthening compliance systems and managing and overseeing personal data appropriately, each department at Cedyna has appointed a Compliance Manager and a Compliance Promotion Leader, and departments are managed according to the guidelines for our business activities. Furthermore, the Internal Control Division is made up of the Compliance Department, the Internal Control Department, the Risk Control Department and the Customer Satisfaction Promotion Department, and takes charge of compliance, internal control and risk management on a companywide basis.