Corporate Governance

Commitment to a Well-Run Company

Tosoh's corporate governance commitments focus on transparency, compliance, business performance, and operational efficiency. In place are a number of committees that all contribute to Tosoh's determination to be a good corporate citizen.

Our corporate governance organization oversees business decision making and business execution. Tosoh's 16-member Board of Directors meets monthly to decide business matters and monitors managers who have operational responsibilities. The Executive Committee, which comprises the company's chairman, president, and senior managing directors, meets weekly to facilitate quick decision making on business proposals.

At the Management Reporting Meeting, the president is provided with background information on operating conditions and on pending decisions for individual business units.

The Board of Auditors made up of two internal and two external auditors monitors Tosoh's accounting system. It also observes the behavior and business execution of Tosoh's Board of Directors. The external auditors have no significant business dealings with or investments in Tosoh and thus bring an objective perspective to the Board of Auditors.

The Office of the Board of Auditors assists the corporate auditors with their tasks. It uses third-party, outside accounting auditors to obtain independent verification of Tosoh's finances. The Auditing Section, meanwhile, conducts operational audits of Tosoh's business units and group companies and reports its findings to the company's president.

Additional committees handle specific aspects of corporate governance. They include the Compliance, Antitrust, Export Management, Internal Control, and Responsible Care Committees.

The Compliance Committee identifies external laws and regulations and internal guidelines and oversees related compliance by the Tosoh Group. In addition, this committee prepares a manual that sets out the ethical responsibilities of the company and its employees. It also monitors compliance with these corporate ethics. Groupwide, Tosoh conducts ongoing training to make employees aware of their responsibilities.

The Antitrust Committee collaborates with Tosoh's Legal and Patent Department to ensure that fair business practices as defined by the Antitrust Law of Japan and by Tosoh's internal guidelines are observed. The committee produces manuals that set out applicable practices.

In 2006, Japanese legislation established systematic guidelines for corporate internal controls to support accurate and reliable financial reporting. Tosoh's Internal Control Committee fosters groupwide awareness of and compliance with these guidelines.

Tosoh's Responsible Care Committee and Environment, Safety and Quality Control Department cooperate in achieving conformance with conservation and antipollution laws and with internal environmental preservation regulations. The committee publishes an annual Responsible Care Report that provides updates on Tosoh's progress in fulfilling its Responsible Care program.