Yamaha 2013 Annual Report Download - page 30

Basic Corporate Governance Policies
Yamaha Motor Co., Ltd. (the “Company”) recognizes that corporate
governance is an important tool to ensure disciplined management and
maximize long-term corporate value. Based on this realization, the
Company has been striving to speed up management decision-making;
make the accountability system clearer; develop a transparent system of
Director selection and remuneration; and establish an internal control
system. Because it is one of its most important management issues, the
Company also plans to implement other measures to strengthen and
solidify corporate governance. At the same time, the Company is enhancing
Investor Relations services, in order to build on the relationship of trust
with its shareholders and investors.
Summary of Corporate Governance and Reasons
for Adopting the System
1) Reasons for adopting current system
The Company maintains an Audit & Supervisory Board Member system,
and most of the Company’s Directors are full-time Directors with
considerable knowledge of business matters. The Company draws on the
supervisory function of outside executives through appointment and had
three (3) Outside Directors in addition to two (2) Outside Audit &
Supervisory Board Members as of March 26, 2014. The Company also
emphasizes efforts to strengthen corporate governance, underpinned by
an Executive Officer system, the Executive Personnel Committee, and an
internal auditing system.
2) Summary of current system
Directors and the Board of Directors and Executive Officers
The Company introduced an Executive Officer system to expedite business
execution. It then strengthened management supervision by clarifying the
respective roles of Executive Officers and the Board of Directors. Executive
Officers are responsible for “business execution” itself, while the Board of
Directors is charged with “approving the basic policies of the Yamaha
Motor Group and supervising the Group’s business execution.”
The Company’s Articles of Incorporation stipulate that the number of
Directors shall not be more than fifteen (15). As of March 26, 2014, there
were twelve (12) Directors, of whom three (3) were Outside Directors. The
Board of Directors will in principle meet once every month, and whenever
else it may be necessary.
The Articles also stipulate that resolutions for the election of
Directors shall be adopted by a majority of the voting rights held by the
shareholders present at the General Meeting of Shareholders. These
voting shareholders must hold shares representing, in the aggregate, not
less than one-third (1/3) of the voting rights of all shareholders entitled to
exercise the rights and not using cumulative votes.
As of March 26, 2014, there were twenty-five (25) Executive Officers,
and nine (9) Directors concurrently serving as Executive Officers. A
Management Committee comprising nine (9) Executive Officers with
specific posts has been formed to deliberate matters of business
execution, speeding up the Company’s decision-making process.
The Management Committee meets monthly in principle, with additional
meetings held as needed. To ensure accountability, Directors and
Executive Officers serve for one-year terms.
In addition, a Global Executive Committee has been established to
deliberate important global management policies and issues related to
the Group’s management. As of March 26, 2014, the Global Executive
Committee had thirty-two (32) members, of whom twenty (20) were
Japanese and twelve (12) non-Japanese, comprising the Company’s
President and Chief Executive Officer, all Executive Officers with specific
posts, and senior local managers of major Group companies. The Global
Executive Committee meets monthly in principle, with additional meetings
held as needed.
Executive Personnel Committee
In August 2001, the Company established the Executive Personnel
Committee as an advisory body of the Board of Directors, in order to
improve transparency in nominating candidates for Director and Executive
Officer, and to determine the remuneration for these officers. As of
March 26, 2014, the Executive Personnel Committee had five (5)
members, comprising the Company’s two (2) Representative Directors
and three (3) Outside Directors. The Executive Personnel Committee
deliberates on candidates for Director and Executive Officer, the
remuneration and bonus system, and the overall direction of governance.
Audit & Supervisory Board Members and the Audit & Supervisory
Board
As of March 26, 2014, the number of Audit & Supervisory Board
Members stood at four (4), of whom two (2) were Outside Audit &
Supervisory Board Members. Audit & Supervisory Board Members
attend Board of Directors’, Management Committee, and other
important meetings, in addition to executing audits, receiving business
execution reports from Directors, perusing important documents in the
decision-making process, and conducting audits at the Company’s
subsidiaries.
In support of these audit services performed by Audit & Supervisory
Board Members, the Company has established the Audit & Supervisory
Board Members’ Office, with staff exclusively dedicated to assisting
auditors. The Audit & Supervisory Board meets monthly in principle, with
additional meetings held as needed.
Internal Auditing
The Integrated Auditing Division established an Internal Control Auditing
Division (consisting of twenty-seven [27] staff members as of March 26,
2014) under the direct control of the President and Chief Executive
Officer. The Division audits, based on annual audit plans, the
appropriateness, reasonableness, and efficiency of business execution at
the Company and each Group company, and submits evaluations and
makes proposals.
Communication among Outside Directors, Audit
& Supervisory Board Members (including
Outside Audit & Supervisory Board Members),
Accounting Auditor, Internal Auditing Division,
and Internal Control Division
Outside Directors assess the current status of the Group and identify
issues of interest through regular receipt of internal audit reports from
the Integrated Auditing Division. Opinions are voiced at Board of
Directors’ meetings when necessary.
In their association with the Accounting Auditor, Audit & Supervisory
Board Members, including Outside Audit & Supervisory Board Members,
receive an auditor’s report, in accordance with prevailing laws, and
review the fairness of the report. Both sides pursue communication
through the exchange of information and opinions whenever necessary.
In their association with the Internal Auditing Division, Audit & Supervisory
Board Members, including Outside Audit & Supervisory Board Members,
seek to improve the effectiveness and efficiency of auditors’ audits
through access to internal audit plans and reports on the results of audits.
The internal control division offers reports, when necessary, to the
Internal Auditing Division, Audit & Supervisory Board Members, and the
Accounting Auditor on the status of internal control measures, specifically
their establishment and application.
Seeking advice
Making
recommendations
Report
Report
Agreement to appointments
Judgment of accounting audit authenticity
Appointment/
Dismissal
Supervision
Reporting business
execution situations
Report
Accounting audit
Audit
Audit
Internal audit
Making recommendations Seeking advice
Seeking advice
Making
recommendations
Business
Execution Report
Exchanges of information and opinions
Report
General Meeting of Shareholders
Business sectors, Functional sectors, Corporate sectors, Subsidiaries
Integrated Auditing
Division
Risk Management and
Compliance Committee
Management Committee
(Examination of important
issues, etc.)
Board of Directors
12 Directors
(including 3 Outside Directors)
Audit & Supervisory
Board Members
Audit & Supervisory Board
4 Audit & Supervisory Board Members
(including 2 Outside Audit &
Supervisory Board Members)
Executive Personnel
Committee
President, Chief
Executive Officer and
Representative Director
Appointment/
Dismissal
Instruction
Instruction
Appointment/
Dismissal
Appointment/
Dismissal
External Auditor
Audit & Supervisory
Board Members’ Office
Corporate Governance
Yamaha Motor’s Corporate Governance System and Internal Control System (As of March 26, 2014)
Yamaha Motor Co., Ltd. ⎢ Annual Report 2013 Yamaha Motor Co., Ltd. ⎢ Annual Report 2013
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