Sustainability

Corporate Governance

IDEC Corporate Governance Policy

The basis of the IDEC Group’s corporate governance is to ensure management transparency and effectiveness for the sake of shareholders and other stakeholders. For this reason, we assign outside directors and separate the management supervisory function from the executive function so as to always maintain a high priority on transparency and effectiveness.
Guided by these principles, we formulated and issued the IDEC Corporate Governance Policy to improve our corporate value in line with “The IDEC Way.” We are taking action under this policy to further strengthen our governance practices so that we can govern our company more effectively.

■ Corporate Governance Policy

Report on Corporate Governance

■ Corporate Governance Report (Last update: June 26, 2024)

Corporate Governance System

■ Policy and procedure for director appointment and dismissal

The process of selecting candidates for directorships is based on a skills matrix outlining the expected skills and other requirements. The Nominating Committee recommends candidates to the Board of Directors on the basis of the skills matrix review, and the nominations are made part of the agenda of the General Meeting of Shareholders through voting at a Board of Directors attended by a majority of independent outside directors.

Directors who are deemed to no longer possess the expected skills and qualities of their position are considered for dismissal. Also, if a director is found to have violated laws, regulations, the articles of incorporation, or otherwise be unfit for the discharge of their duties, the Board of Directors, acting on a report by the Nominating Committee, votes on whether to include a proposal for the director’s dismissal in the General Meeting of Shareholders agenda. This vote must be made at a meeting attended by a majority of independent outside directors.

■Directors & Executive Officers

Evolution of governance

The IDEC Group has separated the business executive function and the supervisory function of the management in order to realize efficient corporate management, and has proactively appointed outside directors since early on. The IDEC Corporate Governance Policy was established to set forth and communicate our views on governance and our operating policy in FY2017. We transformed into a Company with an Audit & Supervisory Committee in FY2019, established a voluntary Nominating Committee in FY2022, and a Remuneration Committee in FY2023.
We have ensured that outside directors constitute the majority of all directors since FY2017. The Board of Directors is a diverse body made up of men and women with different backgrounds and areas of expertise.
Additionally, we introduced a performance-based stock-based compensation (performance share units) and restricted stock (restricted stocks) executive compensation in an effort to review the compensation scheme in FY2024.

Internal Control System

In order to ensure the credibility of the financial reporting of the IDEC Group, we have prepared relevant regulations and have established appropriate systems in accordance with the internal control evaluation criteria for financial reporting. The Internal Control Policy on Financial Reporting is established to clarify the overall Group’s promotion structure, and to establish a framework for continuous self-inspection at each division and group company and for independent monitoring by the Internal Auditing Department.

Nominating Committee and Remuneration Committee

The Company established the Nominating Committee and Remuneration Committee in 2021 and 2022 respectively, and operates them as non-statutory advisory bodies to the Board of Directors. The Nominating Committee considers and deliberates over the nomination of candidates for director, plans to cultivate candidates for the next-generation of top management and succession plans, while the Remuneration Committee considers and deliberates matters related to the remuneration system and regulations, and makes remuneration decisions in accordance with the system. Both committees report to the Board of Directors. The members of each committee comprise directors selected by the Board of Directors, a majority of whom are outside directors, and include the Chairman of the Board of Directors as an inside director.

■ Succession plan