Corporate Governance

An overview of corporate governance.(last update : 30st March,2017)

Corporate Governance

As its basic policy on corporate governance structure, AGC Group clearly separates the functions of "oversight" and "execution" of management, aiming to reinforce the management oversight function while ensuring quick decision-making in management execution. The management oversight function is mainly shouldered by the Board of Directors, which is a "body that approves basic policies and oversees the management of the Group." We have enhanced the objectivity and transparency of management and strengthened our corporate governance system by appointing 3 Outside Directors, out of 7 Directors in total. Aiming to further strengthen the management oversight function, the Company established the Nominating Committee and the Compensation Committee, as voluntary advisory committees of the Board of Directors. The majority of members of both committees are Outside Directors. The Company also adopts the Corporate Auditor system, and the Board of Corporate Auditors consists of 4 Corporate Auditors, including 3 Outside Corporate Auditors.
The management execution function is assumed by the President & CEO and the other Executive Officers. The Company also established the Management Committee as an advisory committee for the President & CEO, and it deliberates on decision making for the Group's management and oversees the business management. With regard to the execution of business operations, the AGC Group introduced the In-House Company system; adopted a globally integrated management system; and transferred significant responsibility and authority for the execution of business operations to each In-House Company and SBUs.

AGC Group Corporate Governance Basic Policy

The Company has formulated the AGC Group Corporate Governance Basic Policy (the "Basic Policy") to further enhance the Company's corporate governance with the aim of achieving both sustainable growth and mid- to long-term enhancement of corporate value.
Its full text is available below.

   

AGC Group Corporate Governance Basic Policy PDF(135KB)

[The AGC Group's Corporate Governance Structure(Outline)]

Corporate Governance Structure

Mechanism for Decision Making, Monitoring, Supervision and Audits

1. Directors and Board of Directors
  (1) Structure of Board of Directors
    - The Company cannot have more than 15 Directors, with the Board of Directors currently consisting of 7 Directors including 3 Outside Directors.
    - To ensure the independence of Outside Directors, the Company elects Outside Directors while using as "the standards for independence of Outside Director / Audit & Supervisory Board Members" for such election the provisions concerning Outside Directors of the Companies Act and in-house regulations. Although there are business relations between the Company and companies to which Outside Directors belong, prices and other transaction terms are determined in the same way as for arm's length general transactions.
  (2) Election of Directors
    - Directors are elected at a General Meeting of Shareholders. To elect Directors, the presence of shareholders owning not less than one-third of the votes of all the shareholders of the Company who are able to exercise voting rights is required, and no cumulative voting is used for that purpose.
  (3) Term of office of Directors
    - The term of office of Directors is 1 year.
  (4) Holding of Board of Directors meetings
    - In the fiscal 2016, the Company held 14 meetings of the Board of Directors.
  (5) Compensation
    - The total monthly amount of compensation for Directors is disclosed in the Business Report.
    - Compensation for inside Directors is paid in the forms of monthly compensation, bonuses, and stock-based compensation stock options. For Outside Directors, only monthly compensation is paid.
    - The Company does not adopt a retirement benefit system for Directors.
    - The Company does not provide loans to Directors when they are exercising their stock options.
2. Nominating Committee
  (1) Structure
    - The Nominating Committee consists of up to 5 Directors, with at least half being Outside Directors. At the moment, the committee is composed of 5 Directors, including 3 Outside Directors.
  (2) Frequency of Nominating Committee meetings
    - The Nominating Committee held 3 meetings in the fiscal 2016.
3. Compensation Committee
  (1) Structure
    - The Compensation Committee consists of up to 5 Directors, with at least half being Outside Directors. Currently, the committee is composed of 5 Directors, including 3 Outside Directors.
  (2) Holding of Compensation Committee meetings
    - The Compensation Committee held 9 meetings in the fiscal 2016.
4. Corporate Auditors and Board of Corporate Auditors
  (1) Structure of Board of Corporate Auditors
    - The Company cannot have more than 5 Corporate Auditors, with the Board of Corporate Auditors currently consisting of 4 Corporate Auditors, including 3 Outside Corporate Auditors.
  (2) Election of Corporate Auditors
    - Corporate Auditors are elected at a General Meeting of Shareholders. To elect Corporate Auditors, the presence of shareholders owning not less than one-third of the votes of all the shareholders of the Company who are able to exercise voting rights is required.
    - The Board of Corporate Auditors elects full-time Corporate Auditors by its resolution. Currently, the Company has 2 full-time Corporate Auditors.
  (3) Term of office of Corporate Auditors
    - The term of office of Corporate Auditors is 4 years.
  (4) Establishment of Board of Corporate Auditors Secretariat
    - The Board of Corporate Auditors Secretariat has been established to assist Corporate Auditors in their duties.
  (5) Independence of staff of the Board of Corporate Auditors Secretariat from Directors
    - Any transfer or evaluation of staff of the Board of Corporate Auditors Secretariat requires the approval of the Board of Corporate Auditors.
  (6) Holding of Board of Corporate Auditors meetings
    - The Board of Corporate Auditors held 14 meetings in the fiscal 2016.
  (7) Compensation
    - Compensation for Corporate Auditors is paid only on a monthly basis, and its total monthly amount is disclosed in the Business Report.
  (8) Others
    - The Company has no personal, capital or business relationships or other conflicts of interest with Outside Corporate Auditors.
5. Accounting Auditor
  (1) Election of Accounting Auditor
    - Accounting Auditor is elected at a General Meeting of Shareholders.
    - The Company's current Accounting Auditor is KPMG AZSA LLC.
  (2) Compensation for audit service
    - In the fiscal 2016, the Company and its domestic consolidated subsidiaries paid 137 million yen to the Accounting Auditor KPMG AZSA LLC. as compensation for the service stipulated in Article 2, Paragraph 1 of the Certified Public Accountants Law (Law No. 103, 1948). In addition, the Company paid 1 million yen to an Accounting Auditor for completing the agreed duties.
       *Amounts less than 1 million yen discarded when they are indicated by the unit of a million yen.

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