SMS Group Corporate Governance Basic Approach
The SMS Group conducts business operations under the Group mission, “We create value and contribute to society by providing an information infrastructure for an aging society.” In order to realize this Group mission, the SMS Group recognizes that it is necessary to meet the needs of all stakeholders, including shareholders, clients, and transaction partners, through the maximization of corporate value, as well as to receive stakeholder support in a continuous manner. With regard to corporate governance, as an important prerequisite, the SMS Group believes that strengthening corporate governance ensures the fairness, transparency, and efficiency of operations. Accordingly, corporate governance is vital for the SMS Group to realize its Group mission.
Corporate Governance Report (Japanese) (Last updated December 19, 2018)
Overview of Corporate Governance System and Reason for Adopting the System
At the 13th Ordinary General Meeting of the Shareholders held on June 24, 2016, a partial revision was made to the Articles of Incorporation, and on the same date the Company thereby transitioned from a company with a Board of Corporate Auditors to one with an Audit & Supervisory Committee. This transition was made to further enhance the Company’s corporate governance.
The majority of important decisions made regarding the Company’s execution of operations is conducted at the Board of Directors and Executive Committee level. The Board of Directors comprises five members, three of whom are outside directors. As a general rule, the Board meets once a month and holds extraordinary meetings when necessary. For other important matters, as a general rule, the Executive Committee, which is made up of directors who are not Audit & Supervisory Committee members as well as executive general managers, meets once a month to supplement management decisions. The Executive Committee makes decisions related to business execution based on the rules and regulations governing the Board of Directors and the committee itself, in addition to the guidelines on administrative authorities. At the same time, the committee confirms the status of business execution. Furthermore, directors who are Audit & Supervisory Committee members attend the Executive Committee meetings as observers.
In accordance with the Audit Policy determined by the Audit & Supervisory Committee as well as the division of duties, directors who are Audit & Supervisory Committee members receive reports from general employees and directors who are not Audit & Supervisory Committee members on the status of executing professional duties and request further explanations when necessary. These directors also inspect important approval forms. In addition, through close collaboration with the Internal Audit Department and accounting auditors, these directors work to maintain and improve the efficiency of corporate management and ensure the legality of that management. Accordingly, the Company believes that the objectivity of management are secured under its current corporate governance system, which has been adopted in order to rationally conduct decision making by the Board of Directors and business execution, ensures that audits and management supervision are functioning sufficiently, and further strengthen the Company’s corporate governance.