Square Enix 2005 Annual Report Download - page 13

11
Annual Report 2005
Corporate Governance
1. Basic Perspectives on Corporate
Governance
The Company has adopted a statutory auditors system.
To strengthen monitoring functions and ensure sound
management, half of the statutory auditors are from
outside. Also, in line with company standards and
guidelines on decision authority, the Board of Directors,
which focuses on enterprise-level management decisions,
and decision-making committees related to business
execution are clearly divided. Through these measures
the Company is undertaking efforts to optimize and
make more efficient managerial decisions and execution
of operations.
2. Implemented Measures
(1) Management and other corporate governance
systems regarding decision making, execution and
monitoring of business operations
The Company has six directors (one outside director) and
four statutory auditors (two outside auditors and one
standing statutory auditor). The term for directors is one
year, same as the company with committees system,
and half of the statutory auditors are from outside.
There is also a stand-alone internal audit staff (directly
reporting to the president) that communicates with the
Board of Auditors and ChuoAoyama
PricewaterhouseCoopers, performs a regular check
and evaluation of the internal management structure
including the Group companies—taking into account
priorities and risks—and then reports and offers advice
to the president.
The Board of Directors meets at least once a month
and enhances mutual checking by vigorous discussions
among the directors, including one outside director.
The Board of Auditors also meets at least once a
month, and performs account and operation auditing
based on audit policies. The auditors also attend the
Board of Directors’ meetings and audit the exercising
of the directors’ functions.
Regarding the utilization of outside independent
professionals, significant legal issues and events are
consulted with several outside counsels as needed.
Accounting issues are reviewed by an independent
audit firm, ChuoAoyama PricewaterhouseCoopers,
under the Commercial Code of Japan and the
Securities and Exchange Law.
In this fiscal year, certified public accountants in
charge are as follows.
• Certified Public Accountants
Partner staff: Nobuyoshi Yuasa, Yasuhisa Yajima
• Supporting staff
Certified public accountants: 2, Assistants: 6, Other: 1
Remuneration for Directors and Auditors
Remuneration for directors stood at ¥332 million
(including ¥6 million for an outside director).
Compensation for auditors came to ¥28 million
(including ¥12 million for outside auditors).
Note: Above amounts include retirement benefits
of ¥176 million paid to a retired director in accordance
with the resolution of the annual general meeting
of shareholders.
Compensation for Independent Audit Firm
The Company has paid compensation of ¥26 million to
ChuoAoyama PricewaterhouseCoopers for auditing as
defined in the Certified Public Accountants Law Article
2 No. 1.
(2) Personal, financial or business relationships and
any conflict of interest between the Company and
independent directors/auditors
No items specified.
(3) Enhancement of corporate governance for the last
fiscal year
The Company has increased the number of Board
members from five to six to strengthen its decision-
making capacity to deal with the complicated and
intense management tasks. Furthermore, the Company
has appointed two directors to head development,
accounting and finance, thereby strengthening control
over operations.