Hitachi 2004 Annual Report Download - page 17

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Corporate Governance
Corporate Governance
Hitachi, Ltd. and its 18 publicly owned Group companies have adopted the
Committee System under the Japanese Commercial Code since June 2003,
in order to strengthen corporate governance. By demarcating responsibilities
for management oversight and those for the execution of business operations,
Hitachi is working to create a framework for quick business operation and
the execution of core strategies contained in the “i.e.HITACHI Plan II ”
medium-term management plan, while making management highly
transparent by adding four outside directors to the Board of Directors.
Some of Hitachi’s directors and executive officers serve concurrently as
directors and committee members at Group companies. In addition, through
the Group Management Committee, established when the Committee
System was adopted, and the Hitachi Group Headquarters, established in
April 2004, Hitachi is strengthening integrated management of the Group,
improving management oversight of Group companies and executing
business strategies formulated to enable the Hitachi Group to demonstrate
its collective strengths. The goal is higher corporate value.
Board of Directors
The Board of Directors determines basic management policies and
supervises executive officers in the performance of their duties while
entrusting to executive officers considerable authority to make decisions
with respect to Hitachi’s business affairs. As of June 24, 2005, the Board of
Directors was made up of 14 directors, four of whom are from outside
Hitachi. Three directors serve concurrently as executive officers. A Board
member to convene and preside over meetings of the Board of Directors
does not concurrently serve as an executive officer.
Within the Board of Directors, there are three statutory committees—the
Nominating Committee, Audit Committee and Compensation Committee—
with outside directors accounting for the majority of members of each
committee. In addition, Hitachi established the Group Management
Committee of its own accord. The Board of Directors met on 14 separate
occasions during the fiscal year ended March 31, 2005, and the attendance
rate of directors at those meetings was 96%. The Nominating Committee,
Audit Committee and Compensation Committee met 5, 12 and 7 times,
respectively, during the fiscal year ended March 31, 2005.
13Hitachi, Ltd. Annual Report 2005