Nidec Sankyo considers an active corporate governance program indispensable to increasing corporate value, retaining the trust of all stakeholders, including shareholders, and ensuring support for the Company.
Nidec Sankyo has adopted an auditing system. The Board of Directors as of June 17, 2008, consists of 6 members, including one outside director. From the standpoint of pursuing company-wide management responsibility, the Board of Directors has reduced its members and placed itself in a position where business policies and management strategies are discussed more actively than before and business challenges that arise from day to day market changes are resolved and decided in order to build a management system to outpace the competition. The term of office of each director is set out as one year in the Articles of Incorporation in order to ensure a timely response to the needs of shareholders, while maintaining a flexible stance toward changes in its management environment. In addition, the Company has introduced a system of executive officers as of June 16, 2008, to ensure a system where each executive officer can make a judgment in quick response to the status of sites under the supervision of the Board of Directors. The Company terminated the directors’ retirement benefit system on March 31, 2005. A yearly contract system has also been introduced to the directors’ compensation system.
As our internal control system, we hold general meetings of shareholders in addition to the Board of Directors and the Board of Auditors, improving and maintaining a system to ensure efficient functioning of each organization and to perform constant supervision.
In regard to our compliance system, compliance and risk management committees have been established with the head of each committee being appointed by the Board of Directors. Concerning basic policy and other important matters, the Nidec Sankyo Group is promoting compliance activities with the approval of the Board of Directors. In addition, the Company encourages ongoing education for all employees and conducts training activities. At the same time, a business management auditors’ office has been established, fully functioning as a framework for internal controls. As a system to assist in our compliance system, we have established an internal reporting system, and an internal reporting reception counter will submit records on the progress of solutions to problems reported to the compliance committee.
The Group makes its management principles consistent with those of its parent company Nidec Corporation to address this issue cooperatively within the Group toward the establishment of internal controls called for by Article 404 of the U. S. Sarbanes-Oxley Act and the Japanese SOX Law.