Mazda 2014 Annual Report Download - page 33

Business Management System
Corporate Governance
Mazda views the enhancement of corporate gover-
nance as one of its most important management
issues, and along with statutory bodies including the
General Meeting of Shareholders, Board of Directors,
and Audit & Supervisory Board, the Company has
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, 2014, Mazda’s Board of Directors
is composed of nine 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, 2011,
Mazda appointed two outside corporate directors,
inaugurating the Outside Corporate Director System
with the objective of further increasing manage-
ment 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 advice on Mazda’s management activities
based on their knowledge, experience, and insights,
and by taking part in the decision-making process.
Management Auditing
Mazda’s Audit & Supervisory Board has five members,
including three outside audit & supervisory board
members who have no business relationship or other
interests with Mazda, and audits the directors in the
performance of their duties as per an annual audit
plan formulated by the Audit & Supervisory Board.
Aside from statutory attendance at the Board of
Directors meetings, the audit & supervisory board
members also attend management meetings, etc.
KPMG AZSA LLC is retained under contract as
Mazda’s independent auditor.
Cooperation among Parties
Responsible for Auditing
Audit & Supervisory Board members (full-time),
the auditing company, and the Global Auditing
Department hold the meetings below on a regular
basis to exchange information mainly on issues
related to internal controls.
■ Meeting between Audit & Supervisory Board
members (full-time) and the auditing company
■ Meeting between Audit & Supervisory Board
members (full-time) and the Global Auditing
Department
■ Three-party meeting between Audit & Super visory
Board members (full-time), the auditing company,
and the Global Auditing Department
Directors’ and Audit & Supervisory Board
Members’ Compensation
The total amount of compensation paid to directors
and audit & supervisory board members is within
the limit approved at the annual General Meeting of
Shareholders. Compensation paid to directors and
audit & supervisory board members during the
March 2014 fiscal year is indicated below.
Notes: 1. The numbers of directors and audit & supervisory board
members shown above include two directors and one
audit & supervisory board member who retired as of the
conclusion of the 147th Annual General Meeting of
Shareholders held on June 25, 2013.
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 12
directors shown above serve concurrently as employees.
3. There is no director who earned compensation pay of
more than ¥100 million.
The established policy for determining the
amount of directors’ compensation 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 evalu-
ation 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 audit & supervisory
board members is decided by an agreement among
the audit & supervisory board members.
Makeup of Corporate Audit Compensation
Remuneration for the Company’s certified public
accountants is as follows.
Furthermore, as another important detail concerning
remuneration, the Company and its consolidated
subsidiaries entrust auditing certification work and
non-auditing work to offices that are affiliated closely
with KPMG and which belong to the same network as
the Company’s certified public accountants. In the
consolidated fiscal year under review, the total amount
of compensation paid by the Company and its consoli-
dated subsidiaries was ¥513 million.
To accounting auditors the Company entrusts
advisory work related to improvements in the finan-
cial reporting processes of its consolidated subsid-
iaries and work (non-auditing work) that falls outside
Article 2, Paragraph 1 of the Certified Public
Accountants Act.
The corporate audit compensation paid to the
Company’s certified public accountants is decided by
agreement with the Audit & Supervisory Board. Based
on audit duration estimates, which are based on the
audit plan for the next fiscal period, comprehensive
Category People Amount
(millions of yen)
Directors 12 499
Corporate Auditors 6 104
Total (of which, Outside
Auditors) 18 (5) 603
(65)
Category Previous consolidated
fiscal year
Consolidated fiscal year
under review
Compensation
based on audit
certification
work (millions
of yen)
Compensation
based on non-
auditing work
(millions of
yen)
Compensation
based on audit
certification
work (millions
of yen)
Compensation
based on non-
auditing work
(millions of
yen)
Mazda Motor
Corporation 206 — 210 7
Consolidated
subsidiaries 75 —76 —
Total 281 —286 7
Corporate Governance Framework
Selection / Dismissal
Reporting,
Cooperation Audit
Reporting
Reporting
Cooperation
Audit
Supervise
Consultation
Selection / Dismissal Selection /
Dismissal
Executive Officers
Division General Managers, etc. Group Companies
Various Committees*
Department Managers
All Employees
Representative Directors Executive
Committee and
Other Advisory
Bodies
Board of Directors,
Directors
(Nine corporate directors, of
whom two are outside directors)
Independent Auditor
* Company-wide Safety and Health Committee Meeting, Quality Committee Meeting, Risk Compliance Committee, Human
Rights Committee, Security Export Control Committee, Security-Related Export Control Committee, etc.
Audit & Supervisory Board,
Audit & Supervisory
Board Members
(Five, of whom three are outside audit
& supervisory board members)
Internal Auditing Departments
General Meeting of Shareholders
31
Mazda Annual Report 2014
CONTENTS
Review of Operations
Foundations Underpinning
Sustainable Growth
Message from Management
Introduction
Brand Value Management
Financial Section