Canon 2008 Annual Report Download - page 20

18
CORPORATE GOVERNANCE
C
omp
l
iance
Shortly after its founding, Canon established the San-J
i,
or
“Three Sel
f
s” spirit, namely “sel
f
-motivation,” or taking the
initiative and bein
g
proactive in all thin
g
s; “sel
f
-mana
g
ement,”
or conductin
g
onesel
f
responsibl
y
and bein
g
accountable
f
or all
one’s actions; and “sel
f
-awareness,” or understandin
g
one’s
situation and role in it. These
p
rinci
p
les remain the basis for em
-
ployee education and provide the platform for the Canon
Grou
p
Code of Conduct
.
Canon recognizes personal information as an important
form of information asset and does its utmost to protect it in
order to
f
ul
fi
ll its social responsibilities. With the aim o
f
keeping
its emplo
y
ees in
f
ormed and aware, the Compan
y
conducts e
-
learnin
g
-based personal in
f
ormation protection education
pro
g
rams on an annua
l
b
asis
.
Di
sc
l
osu
r
e
Canon makes every effort to disclose information on its man
-
agement and business strategies as well as its performance
results to all stakeholders in an accurate, fair and timely man
-
ner. To this end, Canon holds regular brie
fi
ngs and posts the
latest in
f
ormation on its Website to
g
ether with a broad ran
g
e
o
f
disclosure materials. Canon has established its own Disclo
-
sure Gui
d
e
l
ines in a
dd
ition to a Disc
l
osure Committee t
h
at
serves to ensure strict comp
l
iance wit
h
d
isc
l
osure re
g
u
l
ations
prescri
b
e
d
by
stoc
k
exc
h
an
g
es
.
With 44.2% of Canon’s shares owned by non-Japanese
investors as of December 31, 2008, the Group goes to great
lengths to promote close relations with non-Japanese institu
-
tional investors, maintaining investor relations bases in Europe
and the United States and workin
g
to ensure that investors
inside and outside Japan have access to the same in
f
ormation.
Canon wi
ll
continue to promote transparenc
y
an
d
un
d
erstan
d
-
in
g
of its activities b
y
practicin
g
thorou
g
h
g
oin
g
disclosure.
S
igni
fi
cant Di
ff
erences in Corporate Governance Prac-
t
ices
b
etween Canon an
d
U.S. Companies Liste
d
on t
h
e
N
Y
S
E
S
ection 303A o
f
the New York Stock Exchan
g
e (the “NYSE”)
Listed Compan
y
Manual (the “Manual”) provides that compa
-
nies
l
iste
d
on t
h
e NYSE must comp
l
y wit
h
certain corporate
g
overnance standards. However, foreign private issuers whose
s
hares have been listed on the NYSE, such as Canon Inc.
(
the
“Company”), are permitted, with certain exceptions, to follow
the laws and practice o
f
their home country in place o
f
the
corporate
g
overnance practices stipulated under the Manual. In
s
uch circumstances, the
f
orei
g
n private issuer is required to
d
isclose the si
g
ni
fi
cant di
ff
erences between the corporate
g
overnance practices under Section 303A of the Manual and
those required in Japan. A summary of these differences as they
a
pp
l
y to t
h
e Company is provi
d
e
d
b
e
l
ow
.
1. D
i
rector
s
Currentl
y
, the Compan
y
’s board o
f
directors does not have an
y
d
irector who could be re
g
arded as an “independent director”
u
nder the NYSE Corporate Governance Rules
f
or U.S. listed
com
p
anies. Un
l
i
k
e t
h
e NYSE Cor
p
orate Governance Ru
l
es, t
h
e
Cor
p
oration Law of Ja
p
an (the “Cor
p
oration Law”) does not
re
q
uire Ja
p
anese com
p
anies with a board of cor
p
orate auditors
s
uc
h
as t
h
e Company, to appoint in
d
epen
d
ent
d
irectors as
members of the board of directors. The NYSE Cor
p
orate
Governance Rules require non-management directors of U.S.
l
isted companies to meet at re
g
ularl
y
scheduled executive
s
essions without the presence o
f
mana
g
ement. Unlike the
NYSE Corporate Governance Rules, however, the Corporation
Law
d
oes not re
q
uire com
p
anies to im
pl
ement an interna
l
corporate or
g
an or committee comprised solel
y
of independent
d
irectors. Thus, the Company’s board of directors currently
d
oes not include any non-management directors
.
2. Comm
i
ttee
s
Under the Corporation Law, the Compan
y
ma
y
choose to
:
(i) have an audit committee, nomination committee and
compensation committee and abolish the post o
f
corporate
a
u
d
itors
;
o
r