Directors

Number of Directors stipulated in Articles of Incorporation

15

Term of Office for Directors stipulated in Articles of Incorporation

1year

Chairman of the Board of Directors

President

Number of Directors

10

Election of Outside Directors

Elected.

Number of Outside Directors

4

Number of Outside Directors designated as Independent Officer

2

Reason for appointment as Outside Directors

Name

Reason for appointment

Hiroshi Fujikawa

[Reason for appointment as Outside Director]

 

Mr. Hiroshi Fujikawa is currently General Manager of Aerospace Department of Plant Project, Marine & Aerospace Division, Machinery Company of ITOCHU Corporation, our major shareholder. He has abundant experience in the aviation industry. Having judged that he will be able to appropriately perform his duties by leveraging his experience and knowledge in this industry, we propose him as a candidate for Outside Director.

Toshihiko Noguchi

[Reason for appointment as Outside Director]

 

Mr. Toshihiko Noguchi is currently Deputy Senior Vice President, Engineering & Maintenance Center of ALL NIPPON AIRWAYS CO., LTD., a subsidiary of our major shareholder, ANA HOLDINGS INC. He has abundant experience in the airline industry. Having judged that he will be able to appropriately perform his duties by leveraging his experience and knowledge in this industry, we propose him as a candidate for Outside Director.

Shinichi Suzuki

[Reason for appointment as Outside Director]

 

Mr. Shinichi Suzuki has abundant experience and broad knowledge as a Corporate Management. As an Outside Director, he has offered his opinions proactively and supervised the Board of Directors from perspective of Independent Director. Having judged that he will be able to appropriately perform his duties, we propose him as a candidate for Outside Director.

Juichi Watanabe

[Reason for appointment as Outside Director]

 

Mr. Juichi Watanabe has abundant experience in international corporate activities and broad knowledge of Accounting and Internal Control as a U.S. Certified Public Accountant, Certified Internal Auditor and Certified Fraud Examiner. As an Outside Director, he has proactively offered his opinions and supervised the Board of Directors from perspective of Independent Director. Having judged that he will be able to appropriately perform his duties, we propose him as a candidate for Outside Director.

Auditors

Auditors, in close cooperation with the Accounting Auditor, check the audit approach employed by the Accounting Auditor from time to time, and judge the relevance of the audit conducted by the Accounting Auditor through mutual exchange of information. To be more specific, Auditors have a meeting with the Accounting Auditor at the beginning of the term, attend an audit results briefing, are present at the audit by the Accounting Auditor, and provide an opinion on items covered by and details of the audit and appropriateness of corrective measures. In addition, the Accounting Auditor holds an audit briefing for representative and other directors on “Explanations about the Audit Approach and Results”, and ensures that Auditors are present at the briefing to confirm the details and provide an opinion as necessary. Each time when Auditors perform an audit, the results are compiled in an audit record which is distributed to and shared among Representative Directors, responsible Directors, the Accounting Auditor and the Audit Department, as necessary.

 

The Audit & Supervisory Board checks audit details in the annual audit plan prepared by the Audit Department, one of our internal audit departments, and make a request to add audit items as necessary. The Audit & Supervisory Board also checks the status of the audit using a report of the internal audit performed by the Audit Department. Auditors’ auditing schedules are set in coordination with the Audit Department so as to avoid causing excessive burden to departments to be audited, thereby enabling effective audit. The results of the audit performed by Auditors are shared as explained above.

 

Internal audits of our internal control system are performed by the Audit Department (comprising 5 staff members as of June 26, 2019) on the Company and its consolidated subsidiaries in an independent and objective manner. The Audit Department, in cooperation with Auditors and the Accounting Auditor, performs and oversees an internal audit, and evaluates internal control.

 

There are two types of internal audit: regular audits performed based on an annual plan and extraordinary audits performed from time to time. Audit results are reported directly to the President and CEO, and internal audit reports are provided to Auditors as well. Regarding highly specialized activities such as corporate ethics and laws and regulations, information management, information system, accounting and finance, quality assurance, environment, human resources and labor relations, health and safety, and security and export control, the Head Office’s departments overseeing these activities perform internal audits focused on their areas of expertise. Audit results are first evaluated by the Audit Department. Findings are reported to the President and CEO, and internal audit evaluation reports are provided to Auditors as well. Information is shared with the Accounting Auditor as necessary.

Establishment of Audit & Supervisory Board

Yes

Number of Auditors stipulated in Articles of Incorporation

5

Number of Auditors

4

Election of Outside Auditors

Elected

Number of Outside Auditors

2

Number of Outside Auditors designated as Independent Officer

2

Reason for appointment as Outside Auditor

Name

Reason for appointment

Hitoshi Takahashi

[Reason for appointment as Outside Auditor]

 

Mr. Hitoshi Takahashi is well versed in the Commercial Code, the Companies Act, the Financial Instruments and Exchange Act and corporate legal affairs. Particularly he has profound insight into both legal theory and practice concerning legal responsibilities and risk management of corporate officers and internal control systems of corporate groups. After serving as General Manager of the Corporate Auditors’ Office, Head Office of Nippon Steel Corporation, he assumed the position of Managing Director of the Japan Audit & Supervisory Board Members Association. Having judged that he will be able to appropriately perform duties as Outside Audit & Supervisory Board Member from his experience, we propose him as a candidate for Audit & Supervisory Board Member.

Koichiro Watanabe

[Reason for appointment as Outside Auditor]

 

Mr. Koichiro Watanabe has abundant auditing experience as a Certified Public Accountant at an audit firm as well as a background in offering advisory services for M&As and IPO preparations. Having judged that he will be able to appropriately perform his duties as Outside Audit & Supervisory Member by leveraging his professional knowledge and experience, we propose him as a candidate for Audit & Supervisory Board Member. Although he does not have experience in corporate management other than having served as an outside director in the past, we have judged that he will be able to appropriately perform his duties as Outside Audit & Supervisory Board Member for the reasons stated above.

Independent Officers

Number of Independent Officers

4

Directors’ Compensation

Disclosure Status (of Compensation for Individual Directors)

No individual disclosure

 

The Company paid JPY 213 million to 10 Directors (includes JPY 13 million to Outside Directors) and JPY 60 million to four Auditors (includes JPY 13 million to Outside Directors) as compensation for Directors and Auditors for the financial year (2018 ended March 31, 2019).

The aforementioned amount includes provision for officers’ retirement benefits of JPY 10 million recorded in the relevant financial year (JPY 7 million for Directors and JPY two million for Auditors).

 

 

 

 

Policy for Determining Compensation Amount or Calculation Method

Yes

 

Executive Officers’ Compensation

The Company has clearly defined which member of the Board of Directors is responsible for oversight of the management or execution of operations, and has introduced the Executive Officer system, aiming to speed up decision making in executing operations and to increase productivity. Individual compensation (including bonus) for Executive Officers is determined depending on their position and contribution to our results in accordance with the rules established by the Board of Directors.

 

Directors’ Compensation

Compensation (including bonus) for Directors (including bonus) is paid not exceeding the total amount approved by the Shareholders’ Meeting in accordance with the rules established by the Board of Directors. Individual compensation for Directors is determined depending on their position and contribution to our results. If the total amount of compensation exceeds the limit approved by the Shareholders’ Meeting, such compensation will be paid subject to approval at the Shareholders’ Meeting.