To realize sustained growth and increase corporate value, the Mitsubishi Electric Group works to maintain the flexibility of its operations while promoting management transparency. These endeavors are supported by an efficient corporate governance structure that clearly defines and reinforces the supervisory functions of management while ensuring that the company is responsive to the expectations of customers, shareholders, and all of its stakeholders. Additionally, the Mitsubishi Electric Group recognizes that not only ethics and legal compliance, but also compliance in the wider sense of the term that includes the perspective of corporate ethics, are the foundation of the Group's continued existence. Based on this understanding, ongoing efforts are being made to strengthen initiatives related to anti-trust laws, the prevention of corrupt practices and supply chain management, as priority action items.
Mitsubishi Electric Corporation
In recent years corporate governance in Japan has garnered strong attention, to the point that strengthening and enhancing the efficiency of corporate governance has become a priority issue for all companies.
Mitsubishi Electric has adopted a committee system, with the separation of the management supervisory functions from the execution of business being one of its core principles. Based on this principle, the Chairman, who oversees the management supervisory functions, is separate from the President & CEO, who is head of all executive officers, and neither is a member of the nomination or compensation committees. By clearly separating the two functions, Mitsubishi Electric ensures the effectiveness of its corporate governance.
As also stated in the CSR Materiality, Mitsubishi Electric's drive to strengthen its corporate governance is a continuous process. To further enhance the Board of Director’s business supervisory function, venues were established for supplying information to, and exchanging views with, outside directors, in FY2016. Through these venues, efforts were continued in FY2018 to ensure proper and timely provision of information to the directors.
The review of the Board of Directors, which is held every year to strengthen the performance of the Board of Directors, was also held again in FY2018. The review results yielded the evaluation that the Board is consistently sharing management-related information with executive officers in a proper and timely manner and is making readjustments as necessary in response to the results of the review of the Board of Directors in order to properly fulfill its business supervisory function, and that discussions have become even more active and open compared to before. This evaluation in effect endorses the performance of the Board of Directors, but further efforts will be made to enhance debates and discussion by the Board, such as by expanding deliberation times.
Mitsubishi Electric will continue to build an even stronger corporate governance framework, to ensure corporate management is soundly supervised by a proper oversight mechanism.
Corporate Governance Framework
Board of Directors
Mitsubishi Electric Corporation
Mitsubishi Electric engages in a wide variety of businesses on a global scale. In order for the Board of Directors to oversee whether these businesses are executed properly, it is extremely important for information about management to be provided to us directors in a timely and appropriate manner.
At the Board of Directors, adequately detailed information is provided for directors to supervise management, and a forum has been set up with the main objective of providing outside directors with more information about management, so I feel the information we directors receive is extremely extensive. I also get the sense that the company is actively providing us with opportunities to visit various offices and plants to directly hear the opinions of workers and to obtain solid business information.
The performance of the Board of the Directors is evaluated, and efforts are made to improve it. A review of all members is conducted every year, where all directors can freely share their views about the operations of the Board and about how information is shared, etc.
Readjustments are constantly made in response to the results of the review of the Board of Directors, and improvements have been achieved with every review, such that I feel we have become able to discuss various matters more frankly than ever before.
As directors, we feel these opportunities are highly beneficial to understand the current state of Mitsubishi Electric's business, and to engage us in discussions. We hope this timely and appropriate provision of management information will continue to be enhanced, so that the management supervisory functions of the Board of Directors may be further strengthened.
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The Mitsubishi Electric Group abides by the Corporate Ethics and Compliance Statement formulated in 2001 as its basic guideline for compliance, and recognizes the importance of ethics and legal compliance as a fundamental precondition for the Group's continued existence.
Based on this awareness, efforts are directed at strengthening the compliance system, maintenance of facilities, and employee education program, to broadly promote compliance that not only encompasses legal compliance, but also includes the perspective of corporate ethics.
In particular, the Mitsubishi Electric Group treats preventing the violation of anti-trust laws and corruption prevention (preventing bribery) as important issues. We have established a set of internal company regulations, strengthened education and awareness, and are in the process of working on other prevention initiatives. Reflecting on mistakes made in the past, we are establishing rules for contacting companies in our industry, holding continual training divided by level and business headquarters, and engaging in other measures keep the prevention of antitrust violations clear in people's minds and prevent recurrences. For the prevention of bribery, we have enacted the Mitsubishi Electric Group Anti-Bribery Policy in April 2017 and spread it both inside and outside the company, as well as built internal policies for dealing with public officials and other figures, held e-learning geared toward bribery prevention and interview-based practical training with case studies included, and taken other measures to strengthen our policies.
We have also distributed the Mitsubishi Electric Group Standard for Ethics and Regulatory Compliance, a summary of our company's principal approach to compliance, to all employees and are holding continual training related to the standard.
Various learning programs on laws and regulations related to procurement are also provided to employees in charge of procurement activities as one aspect of supply chain management. In Japan, a course on material procurement laws provides guidance and education on the Anti-Monopoly Act, the Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors, the Construction Contractors Law, and our systems of internal checks and balances. In overseas offices, compliance education related to procurement is provided to ensure no employee becomes involved in bribery, embezzlement, or anything else that goes against the principle of fair trade. In addition to the above, CSR education based on CSR Procurement Guidelines is also provided to employees in procurement departments to further strengthen CSR initiatives along the supply chain.
Working-level conference on compliance in the China region
Meeting of compliance managers in the Asia region
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