Nintendo 2016 Annual Report Download - page 18

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2. Corporate Governance
<Principles concerning corporate governance>
At Nintendo, we strive to maximize long-term corporate value while carefully considering the benefits for
everyone we touch. We are working to achieve a highly transparent and sound system of corporate
governance; we also educate our employees about our policies, including good corporate ethics.
(1) Outline of corporate governance system
The Company transitioned to a Company with Audit and Supervisory Committee following the resolution at
the 76th Annual General Meeting of Shareholders held on June 29, 2016, for the purpose of strengthening the
supervisory function of the Board of Directors, and thereby further promoting corporate governance. At the
same time, the Company has introduced the Executive Officer System for the purpose of clarifying the
responsibility for, and thereby accelerating, the execution of operations through the separation of the
management decision-making and supervisory functions from the execution of operations, as well as by
accelerating the delegation of authority to execute operations.
The Board of Directors consists of five Directors (excluding Directors who are Audit and Supervisory
Committee Members) and four Directors who are Audit and Supervisory Committee Members (including
three Outside Directors). The term of office of Directors (excluding Directors who are Audit and Supervisory
Committee Members) is one year and the term of office of Directors who are Audit and Supervisory
Committee Members is two years.
In addition to the meetings of the Board of Directors, which are generally held monthly, the Company also
holds meetings of the Executive Management Committee consisting of the Directors (excluding Directors
who are Audit and Supervisory Committee Members) twice a month in principle, in order to strongly drive
management activities and thereby ensure prompt and efficient decision-making. Furthermore, the Company
maintains the system where executive officers appointed by the Board of Directors every year perform their
respective duties under the President's supervision and instructions.
The Audit and Supervisory Committee consists of one full-time Internal Director and three Outside Directors,
all of the Outside Directors are designated as independent officers. The Audit and Supervisory Committee
Members attend meetings of the Board of Directors and other important meetings, inspect important
documents, have regular meetings with the President and hold monthly meetings of the Audit and Supervisory
Committee as a general rule to share audit opinions. Furthermore, the full-time Audit and Supervisory
Committee Members conduct fieldwork auditing over each division of the Company, etc., based on the annual
audit plan.
With respect to internal auditing, the Internal Auditing Department, under the direct supervision of the
President, conducts internal auditing from a fair and unbiased perspective independent from business divisions,
and works on the promotion and improvement of internal control including subsidiaries and associates.
Accounting Auditor maintains close coordination with the Audit and Supervisory Committee, as well as the
Internal Auditing Department, regarding accounting auditing, including the report on the audit plan and audit
results, as well as information and opinion exchanges as necessary even during the period, in order to ensure
effective and efficient auditing.
<Reasons for choosing the current corporate governance system>
As stated above, the Company has become a Company with Audit and Supervisory Committee for the purpose
of strengthening the supervisory function of the Board of Directors, and thereby further promoting corporate
governance. The Company has also introduced the Executive Officer System for the purpose of clarifying the
responsibility for, and thereby accelerating, the execution of operations through the separation of the
management decision-making and supervisory functions from the execution of operations, as well as by
accelerating the delegation of authority to execute operations.
The Company's basic policy is that persons who have extensive knowledge of our distinctive business be
elected as Directors of the Company since the Company undertakes a unique software-led hardware-software
integrated business in the field of entertainment. Furthermore, multiple number of Outside Directors have
been elected as Audit and Supervisory Committee Members in the Board of Directors of the Company in