Toshiba 2010 Annual Report Download - page 41

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(CPA) on their audit plans at the beginning of each
fiscal year, the Audit Committee can also request
reports on the status of audits during the course
of each term, and explanations and reports on
end-of-year audits, as necessary.
In order to secure highly competent management
personnel, and to ensure effective execution of
duties by directors and executive offi cers, Toshiba
maintains the compensation policy summarized
below.
Directors’ compensation is based on their
duties and full-time or part-time status. The
executive offi cer’s compensation comprises basic
compensation based on the executive officer’s
rank and service compensation based on duties as
an executive offi cer. Some 40-45% of the service
compensation will fl uctuate from zero to double,
according to the year-end performance of the
Company or division for which the executive
offi cer is responsible.
In June 2006, the Compensation Committee
abolished the system for granting retirement
benefi ts to directors and executive offi cers.
With the goal of protecting and enhancing the
Company’s corporate value and the common
interests of its shareholders, Toshiba has
implemented countermeasures against large-
scale acquisitions of shares in the Company.
For more information visit:
www.toshiba.co.jp/about/ir/en/news/20090508_1.pdf
Toshiba has established the Toshiba Group
Standards of Conduct (SOC), which clearly defi ne
the values and codes of conduct that must be
observed by all officers and employees. The
company also requests all group companies, in
Japan and overseas, to adopt the SOC.
Toshiba prioritizes respect for life and safety
and compliance with laws and regulations.
Education programs have been put in to assure
that all employees thoroughly understand and
observe the SOC.
In addition, we have also introduced a
corporate level organization that is charged with
assessing the effectiveness of internal controls
over financial reporting, as required by the
Financial Instruments and Exchange Law of Japan.
Responding to this initiative, the in-house
companies and their affiliates around the world
have established parallel systems.
In order to assist the Audit Committee in the
performance of its duties, we have established an
Audit Committee Offi ce, with a staff of around fi ve.
All personnel transfers to and from the Audit
Committee Office are discussed in advance with
the members of the Audit Committee.
The Corporate Audit Division holds advance
discussions with the Audit Committee on each
year’s audit policy and plans. It also holds semi-
monthly liaison meetings with the Audit
Committee for pre-audit discussions and to share
information on the divisions subject to audit.
The Corporate Audit Division carries out on-
site inspections and reports its results to the Audit
Committee. However, if it deems it necessary, the
Audit Committee has the right to carry out its own
on-site inspections. Furthermore, in addition to
receiving explanations from independent auditors
Toshiba’s Internal Control Systems
Audit
Compensation for Directors and Executive Offi cers
Takeover Defense Measures
TOSHIBA Annual Report 2010 39