Fujitsu 2005 Annual Report Download - page 29

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Annual Report 2005
Corporate Governance
Our Basic Stance on Corporate Governance
We believe that the concurrent pursuit of efficient management
and the proper control of business risks are essential to achieving
sustainable improvement in corporate value. Recognizing that
stronger corporate governance is vital to realizing this goal, we
have actively appointed outside directors to help ensure sound and
transparent management. At the same time, by separating man-
agement oversight and operational execution functions we have
promoted faster decision-making while further clarifying manage-
ment responsibilities. We believe that clear separation of these
functions is helping to realize greater transparency and efficiency.
Corporate Governance Structure
Overview of Corporate Institutions
Fujitsu’s Board of Directors is responsible for management over-
sight, supervising the execution functions of the Management
Strategy Council and the Management Council under its author-
ity. As an executive organ, the Management Strategy Council dis-
cusses and decides upon fundamental policies and strategy
regarding business management. The Management Council makes
decisions on important matters regarding operational execution.
Issues discussed by the two councils and a summary of their
debates are reported to the Board of Directors, which makes
decisions on items of particular importance.
The auditing function is carried out by statutory auditors,
who review the Board of Directors as well as operational
execution functions.
The Board of Directors is composed of eight internal direc-
tors and two outside directors, for a total of 10 members. The
Board of Auditors consists of five statutory auditors: two stand-
ing auditors and three outside auditors.
Audits by Statutory Auditors and Internal Audits
Fujitsu has adopted a statutory auditor system. Auditors attend
important management meetings, including those held by the
Board of Directors, the Management Strategy Council, and the
Management Council to express opinions, and through direct inter-
views with operational units when needed and other methods, they
audit the Board of Directors and operational execution bodies.
Additionally, the Corporate Internal Audit Division has been
established within the Corporate Center to serve as an internal
audit group. This division audits the internal affairs of the com-
pany and its affiliates, proposes improvements in their business
practices, and regularly reports its audit findings to the Manage-
ment Council.
Initiatives to Enhance Corporate Governance in Fiscal 2004
In July 2004, we established The FUJITSU Way Promotion Coun-
cil, a body reporting directly to the president. This council is
charged with further accelerating the groupwide penetration and
implementation of the mission, values and code of conduct that
comprise The FUJITSU Way. We also set up a Compliance Com-
mittee to enhance risk management and promote structures and
procedures for internal compliance based on these core tenets.
In addition, the Risk Management Committee and Environ-
mental Committee, which had both operated independently, were
realigned under The FUJITSU Way Promotion Council. Their
activities are helping to achieve good corporate governance in
accordance with The FUJITSU Way.
Compliance Committee (newly established)
This committee is responsible for promoting structures and sys-
tems to ensure strict compliance with external as well as internal
rules, regulations and norms of behavior. To support these efforts,
we have operated a “help line” system since September 2004 to
serve as a confidential liaison point for receiving reports from
employees and providing guidance to them on matters of conduct.
Risk Management Committee
This committee works to obtain information regarding specific
incidences of risk and to mitigate their impact on customers and
the Fujitsu Group. Serious issues are reported to the Manage-
ment Council or Board of Directors for discussion and response.
In this way, risk issues and countermeasures are disseminated
throughout the Fujitsu Group, strengthening our overall risk
management posture.
Environmental Committee
This committee is responsible for promoting and strengthening
the environmental protection activities of the Fujitsu Group,
which are based on The Fujitsu Group Environmental Policy and
The Fujitsu Group Environmental Protection Program.
Corporate Governance Framework
General Meeting of Shareholders
Board of Directors
President
Management
Strategy Council
Management
Council
Auditors
(Management strategy
decision-making)
(Business execution
decision-making)
Matters of special
significance Auditing
Auditing
Election Election
Designation Management supervision
SupervisionExecution
The FUJITSU Way Promotion Council
Chair: President
Role: Promoting thorough implementation of The FUJITSU Way
Chair: Corporate
executive vice president
Role: Ensure thorough
compliance with laws,
regulations and internal
rules and standards
Chair: President
Role: Minimize risk and
strengthen crisis
management structure
Chair: Corporate
executive vice president
Role: Promote and
strengthen
environmental activities
Promotion of The FUJITSU Way
Management Council
Compliance
Committee
Risk Management
Committee
Environmental
Committee