Marubeni Corporation (hereinafter referred to as “Marubeni”) seeks to steadily increase and maximize corporate value through business activities that are in accordance with its Company Creed and Management Philosophy*, and to build a stable and sustainable group business foundation. To this end, the Corporation, in accordance with the Companies Act and the Regulation for Enforcement of the Companies Act, establishes the policy described below (hereinafter referred to as the “basic internal control policy”) to ensure that all business activities of Marubeni and the business group (hereinafter referred to as the “Marubeni Group”) made up of Marubeni and all Marubeni Group companies (Marubeni’s consolidated subsidiaries and companies which the Corporation regards as being substantially equivalent to its subsidiaries; the same shall apply hereinafter) are conducted appropriately. Marubeni regularly reviews the basic internal control policy in response to changes in social conditions so as to realize a system that is more appropriate and efficient.
The Board of Directors, in accordance with laws and regulations and the Articles of Incorporation, sets the important matters related to management and supervises the execution of duties by Directors. To clearly segregate execution and supervision, the Chairman of the Board without representative rights and the authority for business execution, in principle, chairs the Board of Directors Meetings. Executive Directors execute business operations decided by the Board of Directors, in accordance with the laws, regulations and Articles of Incorporation and report the situation of their duty execution to the Board of Directors. The term of office of Directors is one year to clarify management responsibility and flexibly build optimum management structure in response to changing management environment. Marubeni appoints Outside Directors to ensure effectiveness of corporate governance. Marubeni adopts the executive officer system to improve efficiency of business execution, and adopts a system whereby its Member of Corporate Management Committee, Supervisors participate in the company’s overall management, and instruct and support the overall operation of the respective business divisions in charge by complying with the company’s management policy.
Audit & Supervisory Board Members audit execution of duties by the Directors in accordance with the Rules of the Audit & Supervisory Board and the Standards for Audit by the Audit & Supervisory Board Members by exercising their statutory authority in collaboration with the Audit Department and Accounting Auditor.
Marubeni sets forth code of conduct common for the Marubeni Group such as Marubeni Corporate Principles and Compliance Manual for its Directors and Executive Officers (hereinafter referred to as the “officers”), Audit & Supervisory Board Members, and employees to practice corporate activities in accordance with compliance. To achieve the goal, it establishes various committees including Compliance Committee and takes various measures.
To provide for a situation in which a person learns of a questionable act from the perspective of compliance and the organizational reporting line does not function for some reason, Marubeni establishes the following compliance reporting and consulting points for the entire Marubeni Group.
Marubeni will stand firm against anti-social activities and forces to social order and public security, and will never form or foster relationships with any organization that poses such threats.
Marubeni establishes the Audit Department as an organization directly under the President to study the appropriateness of duty execution by executing persons and compliance status, and implements internal audits through the Audit Department and company-wide self-inspections with support, cooperation, and advisement from the Audit Department. The result of internal audit is reported to the Board of Directors and the Audit & Supervisory Board on a regular basis.
When the execution of duty by an officer or employee results in violation of law or regulation, Marubeni shall seek judgement of the Governance and Remuneration Committee, an advisory committee to the Board of Directors with the majority of members being Outside Directors/Audit & Supervisory Board Members, in the case of an officer, and the Award and Disciplinary Committee in the case of an employee, and take strict actions in accordance with relevant regulations.
Based on the Regulation for Management of Information Assets, Marubeni designates the information assets subject to preservation, preservation period and employees in charge of managing the information regarding information related to execution of duties by officers and employees to develop a system to preserve and manage information and prevent information leakage.
The officers and Audit & Supervisory Board Members may peruse such information assets at all times.
Officers and employees with titles are given necessary authority for executing their duties based on the resolution by the Board of Directors and the Regulation of Authority and Duties, and manage risks associated with execution of duties within the given scope and take responsibility for the result.
Individual projects such as important investment are deliberated by the Investment and Credit Committee, submitted to the Corporate Management Committee, and approved by the President, based on the Regulations of Authority and Duties and Ringi Approval Procedure Regulations. However, in the case of any special provisions set forth in these regulations applying, such special provisions shall take precedence in application. Projects become subject to approval by the Board of Directors depending on laws and regulations, Articles of Incorporation, and the degree of importance of the project. The progress of important projects such as new business is required to be reported on a regular basis to the Corporate Management Committee to strengthen individual risk management.
Risk management such as credit risk, country risk, market risk, foreign exchange and interest rate risk, investment risk, etc. shall be conducted under the management policy and rules for each risk. In addition, the Corporation continues to implement integrated risk management in order to grasp the amount of risk to which the Marubeni Group is exposed. Marubeni implements management of qualitative risks, including reputation risks and information security risks, which are difficult to quantify, through enhancement of compliance structure.
In preparation for occurrence of a serious issues such as a natural disaster, terrorist incident/public disorder/violence, epidemics of infectious diseases and situations in which the Tokyo Head Office loses its ability to function, Marubeni formulates initial response guidelines and a business continuity plan. When a serious situation actually occurs, Marubeni establishes an emergency task force with the President as the head based on the said plan and makes decisions on and implements concrete measures to limit the damage and loss to the minimum.
To ensure efficient execution of duties by Directors, Marubeni sets forth goals shared by all officers and employees at the Marubeni Group such as management policy, management strategy, and management plan and instill them, while establishing concrete targets which individual officers and employees should implement for achieving the goals.
To ensure efficient execution of duties, Marubeni establishes the Corporate Management Committee and deliberates on the highest-order policy regarding management and important company-wide matters.
Marubeni delegates authority to Member of Corporate Management Committee, Supervisors, and Division COOs to create a system that enables swift decision-making regarding jurisdictional products in Japan and abroad. Further, the Corporate Staff Group manages, checks, and supports the Business Divisions in each specialized fields to enable efficient execution of duties.
The Board of Directors decide Directors in charge and clearly stipulates of each officer’s and employee’s roles, authorities, responsibilities, and rules for decision making in various regulations.
Marubeni shall stipulate necessary systems including a system for appropriate reporting to Marubeni regarding managers in charge of achieving an understanding of business status of Marubeni Group companies, providing guidance to and supervising, guidelines regarding the management system of Marubeni Group companies and execution of duties by Directors etc. of each Marubeni Group company, a system regarding appropriate management of risk of losses at Marubeni Group companies, a system for ensuring efficient execution of duties by Directors, etc. of Marubeni Group companies and a system for ensuring Marubeni Group companies’ compliance with laws and regulations in order to enhance internal control of the entire Marubeni Group, improve business performance and progress management. Marubeni Group companies shall ask for advice from Marubeni regarding important management-related matters and report to Marubeni.
The Compliance Committee and other committees shall support and give guidance regarding compliance activities by Marubeni Group companies. Marubeni Hotline* and Marubeni Anti-Corruption Hotline shall be available for officers (including the Audit & Supervisory Board Members) and employees of all Marubeni Group companies as well as officers (including the Audit & Supervisory Board Members) and employees within one year of leaving Marubeni Group.
Marubeni Group shall develop, through activities, etc. of the Internal Control Committee, necessary systems for ensuring reliability and continuous monitoring of financial reporting such as consolidated financial statements as well as a system for ensuring appropriate acquisition, storage, and disposal of assets held by Marubeni Group companies. It shall also establish the Disclosure Committee and develop a necessary system for information disclosure in an appropriate and timely manner.
The Audit Department carries out audit at Marubeni Group companies and reports the result to the Board of Directors. The Audit & Supervisory Board Members and Accounting Auditor independently carry out inspection and accounting audit at Marubeni Group companies.
Marubeni establishes the Audit & Supervisory Board Member’s Office and appoints dedicated staff members to assist in the duties of the Audit & Supervisory Board Members.
The Officer in charge of personnel affairs shall implement personnel affairs of the Audit & Supervisory Board Member’s Office (personnel changes, evaluation, disciplinary actions, etc.) by hearing the opinions of the Audit & Supervisory Board Members in advance and upon receiving their consent.
The Audit & Supervisory Board Members shall attend the Board of Directors Meetings and receive reports from Directors on execution of duties and other important matters, and also attend the Corporate Management Committee and other important meetings.
The President holds meetings with the Audit & Supervisory Board Members on a regular basis, reports on execution of duties, and exchange opinions. Other Directors, CHRO, CSO, CFO, CAO, CDIO, Member of Corporate Management Committee, Supervisors, Division COOs and Corporate Staff Group General Managers report their duty execution status to the Audit & Supervisory Board Members every year. Officers immediately report to the Audit & Supervisory Board Members when they discover that there is a concern that the Corporation will suffer significant damage. Marubeni develops a system for Directors, Audit & Supervisory Board Members, and employees of Marubeni Group companies, or those who received a report from them, to report directly or indirectly to the Audit & Supervisory Board Members. Notwithstanding the above, the Audit & Supervisory Board Members may seek report from officers and employees whenever necessary. Marubeni has in place a system to ensure that the person who made a report to the Audit & Supervisory Board Members would not be treated unfairly at Marubeni or Marubeni Group companies because of the concerned report.
The Audit & Supervisory Board Members receive respective audit plans in advance from the Audit Department and Accounting Auditor, hold regular meetings to exchange opinions regarding audit policy and audit result reports. The Audit & Supervisory Board Members collaborate with Audit & Supervisory Board Members of Marubeni Group companies through Group Auditor Liaison Meeting and exchange information regarding the development of internal control at each company and their operations.
The Audit & Supervisory Board Members can appoint lawyers, certified public accountants, and other external advisors when they deem it necessary.
Marubeni shall pay expenses arising from the execution of duties by the Audit & Supervisory Board Members, including the cost of having external experts described above in response to request by the Audit & Supervisory Board Members, through a prescribed procedure and allocate for it in budget.
