Ricoh 2011 Annual Report Download - page 29

• The Internal Management and Control Division, the Ricoh
Group’s internal auditing division, reviews and assesses, in a
fair and objective manner, the status of each business operation
department to ensure the legal compliance and adequacy of
business operations executed, and, in addition, offer advice and
recommendations for improvement.
• In response to growing calls for greater independence of the
Independent Auditor, the Ricoh Group has formulated a set of
guidelines called the Policy and Procedures for Prior Approval
concerning Audit and Non-Audit Services. Accordingly,
finalization of the details of and fee for audit engagement requires
the prior approval of the Board of Corporate Auditors.
• To establish and improve the internal control system of the Ricoh
Group, an Internal Control Committee is instituted within the
GMC. It is expected to convene regularly to deliberate and decide
on relevant matters.
■ Basic policy on executive compensation
At the Ricoh Group, executive compensation is employed as
an effective incentive for achieving the sustainable increase
of corporate earnings and, in turn, shareholder value over the
middle and long term. The base salary of a Director consists
of: remuneration pertaining to his/her management oversight
role, remuneration reflecting the importance of management
roles and responsibilities, remuneration for the purpose of
purchasing treasury stock (except for Outside Directors), and
variable remuneration linked to stock price performance during
the relevant fiscal year. The amount of bonuses paid to Directors
is determined based on the achievement of key performance
indicators (sales, operating income, and ROA) pertaining to
shareholder value and the competitiveness of the Group. Proposed
executive bonuses are brought before the Ordinary General
Meeting of Shareholders for approval.
The compensation of Corporate Auditors is comprised solely
of remuneration for their auditing duties.
Risk management and compliance
The Ricoh Group maintains the appropriateness of its operations
and legal and regulatory compliance in its business execution
through the following measures:
• Ricoh’s Board of Directors and the GMC make decisions and
perform management oversight for the Ricoh Group as a
whole. To ensure the efficacy of such efforts, they establish
management regulations concerning affiliate companies, and
set up relevant administrative organizations in order to manage
the Group.
• The Group set a basic disclosure policy to assure the accuracy,
timeliness and comprehensiveness of disclosure of corporate
information, and established the Disclosure Committee, an
independent organization, to verify the process of disclosure.
• The application of the Ricoh Group Standard (RGS), a set of
common rules to be followed by the entire Group.
• In order to thoroughly implement the Ricoh Group Corporate
Social Responsibility (CSR) Charter, which sets forth the
principles of corporate behavior including compliance, and the
Ricoh Group Code of Conduct, which articulates the general
rules of conduct for Ricoh Group employees, the Specialty
Committee and a hotline for reporting incidents and seeking
advice have been established. Also various training programs
are set up to enhance compliance domestically and overseas.
• The Ricoh Group has built and is operating a system for Total
Risk Management (TRM), the primary purpose of which is to
achieve effective and efficient integrated risk management by
identifying, organizing, and addressing risks surrounding the
Group, and ultimately to achieve consistent and sustainable
prosperity and greater corporate value of the Group.
In addition, the Group has also formulated Business
Continuity Plans (BCP) to help minimize damage and achieve
prompt recovery and continuity of business in the event of an
earthquake or other natural disaster or outbreaks of new types
of flu or other infectious disease.
Executive compensation (for the year from April 1, 2010 to March 31, 2011)
16
4
5
3
21
7
346
21
74
14
421
35
82
—
—
—
82
—
429
21
74
14
504
35
(¥million) No.
(People)
Base salary
(¥million)
Bonus
(¥million)
Total
(¥million)
Directors
Corporate Auditors
Total
Outside Directors
Outside executives
Outside Corporate
Auditors
* The figures above include those for five Directors and one Corporate Auditor who retired
following the 110th Ordinary General Meeting of Shareholders held on June 25, 2010.
ANNUAL REPORT 2011 28