Mazda 2011 Annual Report Download - page 33

Corporate Governance Framework
Corporate Governance
Mazda views the enhancement of corporate governance as
one of its most important management issues, and along with
statutory bodies including the General Meeting of Shareholders,
Board of Directors, and Board of Corporate Auditors, we have
introduced an executive officer system to separate execution
and management functions.
This is intended to expedite decision making by increasing
the effectiveness of the Board of Directors as a supervisory
body, by enhancing the deliberations of the Board of Directors,
and by delegating authority to executive officers.
As of June 30, 201 1, Mazda’s Board of Directors is composed
of 1 1 members, two of whom are outside corporate directors
with a high degree of independence.
Inauguration of an Outside Corporate Director System
At the shareholders’ meeting held on June 24, 201 1, Mazda
appointed two outside corporate directors, inaugurating an
outside corporate director system with the objective of further
increasing management soundness and transparency. The
outside corporate directors are expected to help strengthen the
auditing functions of the Board of Directors and further boost
the transparency of management by offering management
advice based on their knowledge, experience, and insights, and
by taking part in the decision-making process.
Management Auditing
Mazda’s Board of Corporate Auditors has five members,
including three external corporate auditors who have no
business relationships or other interests with Mazda, and
audits the directors in the performance of their duties as per
an annual audit plan formulated by the Board of Corporate
Auditors. KPMG AZSA LLC is retained under contract as
Mazda’s independent auditor.
Cooperation among Parties Responsible for Auditing
A “Three-Way Audit Meeting” of the full-time corporate auditors,
the auditing company, and the Global Auditing Department is
held four times every year, primarily to discuss the status of
progress with regard to auditing under the Japanese
Sarbanes-Oxley Act (J-SOX)* and the issues during business
operations/accounting audit process.
Regular meetings of the full-time corporate auditors and the
Global Auditing Department are held monthly to exchange
opinions in further detail regarding issues identified in audits.
* The Japanese version of the Sarbanes-Oxley Act (original Sarbanes-Oxley Act is a U.S.
federal law)
Directors’ and Auditors’ Compensation
The total amount of compensation paid to directors and
corporate auditors is within the limit approved at the annual
General Meeting of Shareholders. Compensation paid to
directors and corporate auditors during the March 201 1 fiscal
year is indicated below.
Mazda has an established policy for determining the amount
of directors’ compensation, which is based on a structure
linked to the Company’s performance and each individual
director’s performance. Goals are set at the beginning of the
fiscal year, and an evaluation is made at the end of the fiscal
year according to designated criteria and processes for
measuring the degree of achievement of those goals, and
based on this evaluation a final decision is made by the
president. Compensation for corporate auditors is decided by
an agreement among the corporate auditors.
People Amount
(millions of yen)
Directors 11 507
Corporate Auditors
(of which, Outside Auditors) 6 (3) 103 (35)
Total 17 610
*1. The numbers of directors and corporate auditors shown above include two directors and
one corporate auditor who retired as of the conclusion of the 144th Annual General
Meeting of Shareholders held on June 24, 2010.
*2. The amounts paid to directors do not include the employee’s portion of compensation
for directors who serve concurrently as employees. However, none of the eleven
directors shown above serve concurrently as employees.
*3. The amounts of compensation shown above include ¥1 million paid in the form of
stock options to directors.
General Meeting of Shareholders
Board of Corporate
Auditors,
Corporate Auditors
(Three out of five are
outside corporate auditors)
Selection / Dismissal
Reporting
Reporting
Audit
Supervise
Consultation
Selection / Dismissal Selection / Dismissal
Independent Auditors
Executive Officers
Division General Managers, etc.
Representative Directors
Executive
Committee and
Other Advisory
Bodies
Board of Directors, Directors
(Two out of 1 1 are outside directors)
Mazda Annual Report 201 1 31