Basic Corporate Governance Policy
Mitsubishi Electric strives to pursue continuous growth by enhancing flexibility in operations and management transparency, and at the same time consistently endeavors to reinforce the supervisory functions of management. Our basic policy consists in establishment of an efficient corporate governance structure responsive to various expectations from various stakeholders (among other customers and shareholders) and, by this way, we aim further increase of our corporate value.
Current Status of Implementation of Various Measures Relating to Corporate Governance
Company Organization and Development of Internal Control Systems
In June 2003 Mitsubishi Electric reformed its management structure when it changed to a company with a committee system. The supervisory and executive powers of management were thus separated, with the board of directors handling supervisory decisions and executive officers handling executive decisions.
The present board consists of twelve directors (five of whom are outside directors) offering advice and supervision to management from an objective standpoint. The board of directors has three internal bodies: the Auditing, Nomination and Compensation Committees. Each body has five members of which three are outside directors. The Auditing Committee has its own dedicated, independent staff, which supports the auditors.
A key feature of our management structure is the separation of the Chairman and CEO, with the Chairman as the head of the supervisory functions as a member of the board of directors and the President & CEO as the head of the executive officers. Neither the Chairman nor President is a member of the Nomination or Compensation Committees. This clear separation of supervising and execution powers makes our corporate governance more effective.
To maintain compliance and secure management efficiency, each executive officer possesses responsibility for their individual scope of duties, with operating conditions being audited by internal auditors (Audit Department). The internal auditors (Audit Department) and outside auditors report their audit results to the Audit Committee and executive officers in charge.
Internal Audit and Inspections by Audit Committee, Independent Auditors
The Audit Department conducts its internal audits from a fair and impartial standpoint by having its own dedicated staff in addition to supporting auditors that represent the special interests of relevant departments.
The Auditing Committee consists of five directors of which three are outside directors. In accordance with the policies and assignments agreed to by the committee, inspections are conducted by competent members, into the performance of the directors and executive officers as well as mutual exchanges of opinion.
KPMG AZSA & Co. has been retained as the independent auditor. KPMG AZSA & Co. appoints partners in charge, and the firm has designated Mr. Yoshino Nakamura, Mr. Hiroto Kaneko, and Mr. Ryoji Fujii as the partners in charge handling auditing for Mitsubishi Electric. Support staff for handling auditing will consist of appropriate CPA and JA from KPMG AZSA & Co. Mitsubishi Electric will maintain an environment in which fair and impartial audits can be conducted, such as providing relevant management information to KPMG AZSA & Co.
