Corporate Governance
Latest Update :
Jul.1, 2011
Independent Directors, Compensation for Directors, etc.
Internal Audits, Audits by Corporate Auditors and Accounting Audits
Internal audits are conducted by the Internal Auditing Office, which has been established under the CSR Promotion Division. Internal audits are designed to correct nonconforming or inappropriate operational procedures and improve the quality and efficiency of operations in accordance with internal audit regulations.
The Board of Corporate Auditors is comprised of four members (two standing corporate auditors and two corporate auditors), three of which are external corporate auditors. The corporate auditors, working in line with the audit policy laid down by the Board of Corporate Auditors, attend Board of Directors' meetings and other key meetings. They also work in conjunction with the Internal Auditing Office to audit domestic offices, subsidiaries, and overseas affiliates, as well as the activities of the directors through an audit inspection of business operations and assets.
The Corporate Auditors meets regularly with the Internal Auditing Office to hear its annual auditing schedule, its purposes and all of these auditing results. When the Office conducts its internal auditing, the Corporate Auditors discuss its purposes and focus beforehand, and attend these auditing if necessary.
The Board of Corporate Auditors also meets with Minebea's independent auditor, KPMG AZSA LLC, four times a year to confirm information regarding the performance of audit systems, plans and implementation, as well as to exchange opinions. In witnessing the financial audits of domestic offices and subsidiaries, as well as overseas subsidiaries, the Board is also able to get a clear picture of Minebea's financial status on a regular basis.
Financial audits are conducted by KPMG AZSA LLC on the basis of an audit contract with Minebea and pursuant to the Company Law and the Financial Instruments and Exchange Law. The most recent financial audit of Minebea was performed by certified public accountants, Toshiharu Kawai, Yoshihiko Nakamura, and Danya Sekiguchi, who were assisted by 3 other certified public accountants and 15 others.
The Board of Corporate Auditors reviews the details of the audit contract and compensation packages for the financial auditors to ensure the integrity of the auditing process by verifying the independence of the audit company.
Independent Directors and External Corporate Auditors
Of the Company's two independent directors, Kohshi Murakami, is an attorney. There are no conflicts of interest existing between him and the Company such as personal relationship, investments or trade relationship. Takashi Matsuoka, the other independent director, is senior managing director of Keiaisha Co., Ltd. which owns a 3.76% interest in the Company, and at the same time, does business with the Company on a regular basis.
Regarding roles and functions of the independent directors, we anticipate that they will provide guidance to ensure the sound management of the Company, promote compliance, and strengthen function to supervise executives from their profound knowledge and perspective from legal and business viewpoints.
Of the Company's three external Corporate Auditors, Kazuaki Tanahashi has been for many years engaged in financial business at a commercial bank. Hirotaka Fujiwara is familiar with corporate legal affairs as an attorney. Hisayoshi Rikuna is a lisenced accountant. We anticipate that they will strengthen our auditing function with their profound knowledge and perspective from their financial, legal and accounting professional view points.
Regarding the Company's three external Corporate Auditors, there are no conflicts of interest existing between them and the Company such as personal relationship, investments or trade relationship.
Compensation for Directors and Corporate Auditors
Regarding compensation for directors and corporate auditors, limits for directors and corporate auditors as a group have been set by the resolution of the general shareholders meeting. Within these limits, each Director's compensation was determined by a resolution by the Board of Directors according to functions, performances, conditions of the Company and other factors. In the case of Independent Directors, compensations are set according to their professional backgrounds and other factors. Corporate Auditor's compensations are set by the Board of Corporate Auditors.
The followings are total compensations for directors, corporate auditors and independent directors and external corporate auditors combined for this fiscal year.
| Total Compensation (thousand yen) |
Total for each class of compensation (thousand yen) |
Number of persons in each class | ||
|---|---|---|---|---|
| Basic compensation | Bonus | |||
| Directors (excluding independent directors) |
347,975 | 253,835 | 94,140 | 8 |
| Corporate Auditors (excluding external auditors) |
23,817 | 23,817 | - | 2 |
| Independent Directors and External Auditors combined | 44,803 | 44,803 | - | 5 |
| Total | 416,595 | 322,455 | 94,140 | 15 |
| Notes: |
|
Limiting Liability of Directors and Corporate Auditors
Pursuant to Company Law Article 426, Paragraph 1, Minebea stipulates in its Articles of Incorporation that the Board of Directors has the authority to limit liability of Directors and Corporate Auditors (including former Directors and Corporate Auditors) for compensation of damages for acts defined in Company Law Article 423, Paragraph 1. This is in order to create an environment in which Directors and Corporate Auditors perform their full capacity to carry out the duties which are expected of them.
Content and Summary of Contracts Limiting Liability
A contract pursuant to Company Law Article 427, Paragraph 1, is in force between the Independent Directors, the External Corporate Auditors and Minebea. This contract limits compensation for damages detailed in Company Law, Article 423, Paragraph 1. The maximum amount of compensation for damages based on this contract is prescribed by law. In addition, these limitations on liability are limited to situations when the Independent Directors and External Corporate Auditors' duties which are the cause of the liability are well intentioned and lacking in negligence.
Equity holding
Total number of companies and amounts on the balance sheet of equity holdings which are not for pure investment
14 companies 5,076 million yen
Equity holdings of listed shares not for pure investment
| Companies | Number of shares | Amount on B/S (million yen) |
(Purpose of holding) |
|---|---|---|---|
| The Sumitomo Trust and Banking Co., Ltd. | 2,070,372 | 892 | To maintain better business relationship |
| Mitsubishi UFJ Financial Group, Inc. | 2,189,700 | 840 | To maintain better business relationship |
| Sumitomo Mitsui Financial Group, Inc. | 141,740 | 366 | To maintain better business relationship |
| The Hachijuni Bank, Ltd. | 500,000 | 239 | To maintain better business relationship |
| T&D Holdings, Inc. | 56,700 | 116 | To maintain better business relationship |
| Basic Facts About Sumitomo Metal Industries, Ltd. | 250,000 | 46 | To maintain better business relationship |
| Mizuho Financial Group, Inc. | 300,350 | 41 | To maintain better business relationship |
| Notes: |
|
Compensation for Independent Auditors
| Classification | Previous consolidated fiscal year | This consolidated fiscal year | ||
|---|---|---|---|---|
| Compensation for certification services (in millions of yen) |
Compensation for non-auditing services (in millions of yen) |
Compensation for certification services (in millions of yen) |
Compensation for non-auditing services (in millions of yen) |
|
| Audited Company | 95 | - | 90 | 6 |
| Consolidated subsidiaries | 15 | 0 | 14 | 0 |
| Total | 110 | 0 | 104 | 7 |
Other Compensation
(During the previous fiscal year)
Our consolidated subsidiary, NMB-Minebea Thai Ltd. paid 74 million yen to KPMG Phoomchai Audit Ltd., which belongs to the same KPMG network as KPMG AZSA LLC, as compensation for certification services. NMB (USA) Inc. paid 83 million to KPMG LLP as compensation for certification services. Minebea Electronics & Hi-Tech Components (Shanghai) Ltd. paid 22 million yen to KPMG Huazhen as compensation for certification services.
(During this fiscal year)
Our consolidated subsidiary, NMB-Minebea Thai Ltd. paid 73 million yen to KPMG Phoomchai Audit Ltd., which belongs to the same KPMG network as KPMG AZSA LLC, as compensation for certification services. NMB (USA) Inc. paid 77 million to KPMG LLP as compensation for certification services. Minebea Electronics & Hi-Tech Components (Shanghai) Ltd. paid 17 million yen to KPMG Huazhen as compensation for certification services.
Non-auditing Services Provided by Independent Auditors
(During the previous fiscal year)
There is no applicable matter.
(During this fiscal year)
We provided compensation to Independent Auditors for non-auditing services including advisory services related to International Financial Reporting Standards (IFRS).
Policy on Determining Compensation for Independent Auditors
The Group has no policy for determining compensation for auditors.
