Sustainability

Governance

We strive to be a company that builds and maintains relationships of trust with stakeholders who support us and that continuously enhances its corporate value. To this end, ensuring sound, transparent, and efficient management is essential.

Therefore, we position the ongoing enhancement of corporate governance as a vital management concern.

Corporate Governance

Overview of the Corporate Governance System

We adopt the organizational design of a company with the Audit and Supervisory Committee. With this structure, we have worked to accelerate decision-making, strengthen the execution of operations, and—with the active participation of independent External Directors—enhance the effectiveness of the audit and supervisory functions of the Board of Directors to improve the transparency of corporate management.

 

Corporate Governance System

 

 

Board of Directors

The Board of Directors deliberates on key management decisions and receives regular reports on the status of operational execution.
Members engage in lively discussions for decision-making and reinforce the supervisory function for management.
 

Board of Directors

Board of Directors Meetings are attended by the seven Directors as well as all Operating Officers and Presidents of group companies in Japan.

 

Directors and Operating Officers

 

 Composition of the Board of Directors (Skills Matrix)

skills matrix

Audit and Supervisory Committee

The Audit and Supervisory Committee, in accordance with the audit policy and plans, audits and supervises the execution of duties by the Board of the Directors by attending the Board of Directors and other important meetings as well as examining corporate operations and assets.
 

Nomination and Remuneration Advisory Committee

The Nomination and Remuneration Advisory Committee (an optional committee) was established as an advisory body to the Board of Directors in order to ensure transparency and objectivity of decisions on the nomination and remuneration of Directors. It deliberates and makes recommendations on matters related to the nomination policy, election and dismissal of Directors as well as the system determining the amount of remuneration for Directors.

 

Management Committee

The Management Committee is mainly composed of internal directors and operating officers and is convened to accelerate strategic decision-making, respond to important issues, and deliberate or report on the status of operations and other matters. In addition to reporting on monthly consolidated business performance, it meets in a timely manner to ensure agile management.
 

Operating Officer

We operate an Operating Officer System to separate management supervision from operational execution and expedite the implementation of operations.
 

Internal Auditing System

The Internal Auditing Department, which is in charge, carries out internal audits based on the Basic Annual Audit Plan and reports its results to our President & CEO. In addition, the Internal Auditing Department cooperates with the Audit and Supervisory Committee and the Accounting Auditor to carry out highly independent and effective audits.

 

Internal Control

We have the “Basic Policy on Internal Control System”* in order to ensure that Directors execute their tasks in compliance with laws and regulations and the Articles of Incorporation, and ensure the appropriateness of other business operations. We manage an internal control system under the policy.

In addition, we have built and are operating an internal control system for financial reporting based on the Financial Instruments and Exchange Act.

*“B asic Policy on Internal Control System” is disclosed in the Corporate Governance Report and other reports (Japanese only).
 

Risk Management

Corporate Policy

We believe it is essential to appropriately manage risks surrounding the Group to achieve our management objectives and implement our business strategies and we have therefore established and are operating a company-wide risk management system to handle risks in an integrated and centralized manner at the headquarters.

Risk Management

Group-wide Risk Management System

Organizing and confirming risks by the Risk Management Committee

We established the Risk Management Committee in accordance with the Basic Regulations on Risk Management and hold meetings twice a year during the first and second half of each fiscal year. In the first meeting the committee narrows down important risks from those collected from each department and confirms and organizes the details and countermeasures.

In fiscal year 2020, we reviewed the system and integrated the risk collection process with the departmental goal management system to ensure the comprehensiveness of the collected risks and efficiency of the collection process so that we can identify risks in a more timely and effective manner.

In addition, the committee centrally grasps the risks of overseas group companies through individual interviews with each company.


Determining important risks by the Management Committee and implementing measures by each department

The Management Committee deliberates on the details confirmed and organized by the Risk Management Committee and identifies the key risks affecting group management.

Key risks are communicated group-wide through the head of each department and necessary measures (reduction, retention, avoidance and transfer) are undertaken by the relevant departments.


Grasping the risks for the next fiscal year

In the second meeting, the Risk Management Committee confirms the details and progress of our response to each risk and identifies risks that will continue to require attention in the following fiscal year.

We also reflect those risks in the planning of our management objectives and plans for the following year.


Business Continuity Plan (BCP)

In proactive preparation for the potential impact from major disasters, we have formulated and thoroughly disseminated a BCP throughout the company. In particular, our Disaster Response BCP stipulates procedures for confirming employee safety and facilitating necessary rescue operations in the immediate aftermath of a major disaster and within one month, restoring at least critical operations and resuming the supply of our products.


Natural disasters such as typhoons, heavy rain and unexpected situations such as infectious diseases may complicate material procurement. To address these risks, we are implementing measures such as strategically securing a physical inventory of components and identifying alternative parts at the design stage.

Information Security

To ensure proper handling of confidential and personal information, we established and have implemented regulations on information management. In addition to organizational, physical and technological countermeasures, we have set up a dedicated contact point to deal with information leaks and other incidents to reinforce our information security system.


More aggressive regulations to protect personal information are in effect worldwide and we are implementing necessary measures such as employee training in response to the General Data Protection Regulation (GDPR) (Europe) and California Consumer Privacy Act (CCPA) (United States). In Japan, we are strengthening our efforts to protect personal information and achieved JIS Q 15001 (Privacy Mark) certification in 2018.

 

Compliance

Corporate Policy

We established the EIZO Group Principles of Conduct* as guidelines for conducting business activities with integrity in consideration of the environment, human rights and ethics toward achieving our corporate philosophy of “enriching future society through imaging solutions.” The Principles of Conduct express our commitment to stakeholders regarding our approach to sustainability and at the same time represent the standards on which we base our decisions and actions in our business activities.


In May 2021, we revised the Principles of Conduct to make them more effective and easier to understand as a compliance guideline for every employee. The revised Principles of Conduct were distributed as a printed card to all executives and employees of group companies in Japan and were also translated into multiple languages and distributed to overseas group companies to instill a thorough awareness of the Principles of Conduct among all our executives and employees globally.


The full text of "EIZO Group Principles of Conduct"

Compliance Management System

Implementation of a compliance program by the Compliance Committee

We established the Compliance Committee in accordance with our “Regulations on Compliance.” The committee identifies and evaluates compliance risks within the group each fiscal year and develops and implements a compliance program that includes necessary preventive and corrective measures.


Representative compliance risks to be identified include factors that would inhibit fair business, activities that might lead to corruption (business integrity risk) and the danger of leaking confidential information. We comprehensively examine potential risks to the Group and evaluate the materiality of risks based on the likelihood of their emergence and impact.

compliance


Checking and improving the compliance program

Every year, we monitor implementation details and insufficient results in our compliance program based on the regulations. In addition, we periodically review our Regulations on Compliance to continue to improve compliance management.


Compliance Training

As a group engaged in global operations, we pay the utmost attention to all local and international laws and regulations, the latter of which is becoming increasingly complex year by year. Thus, we integrated legal compliance and education into our compliance program.


We monitor local trends by regularly exchanging opinions with overseas group companies in order to respond to laws and regulations in a timely and appropriate manner and to provide any necessary training.

In Japan, we encourage our executives and employees to update their knowledge of relevant laws and regulations on compliance by offering information through intranet educational and other materials posted by the Legal Department. We organize regular study groups for each department and workshops for each job position, such as for executives, managers, and new employees, so they can develop the knowledge they need, and we use online educational tools to confirm that the knowledge is instilled in them.

We will continue to educate each and every one of the EIZO Group on the necessity and importance of compliance to foster their awareness of compliance.

 

Internal Whistle-Blowing System

In accordance with “Regulations on Internal Whistle-Blowing,” we have established internal whistle-blowing systems in all group companies worldwide. Also, we strive to ensure the early detection and prevention of serious incidents that could damage corporate value, such as illegal activity or misconduct.


Contact points have been set up inside the company and at independent law firms, and all EIZO members are expected to report any legal or ethical business issues, compliance questions, or concerns immediately, regardless of their own involvement. In addition, we have taken action to alleviate concerns about whistle-blowing, such as by clarifying the procedures for responding to whistle-blowing, protecting the privacy of whistle-blowers, and prohibiting any negative impact for whistle-blowing. We have been disseminating information to employees to improve the content and operation of the regulations so that the system can be easier to use and effective for self-correction.