Brother Industries, Ltd. Corporate Governance
Brother Industries, Ltd. (BIL) established the "Brother Group Basic Policies on Corporate Governance" in November 2015, and since then has been striving to strengthen its governance in line with these basic policies.
Statutory Auditor System and Executive Officer System
BIL's board of directors consists of 11 directors (including five outside directors)*. They decide important management matters and oversee executive operations. BIL also adopts a statutory auditor system (five auditors, including three outside auditors)* as the basis of its corporate governance, and has an entrenched mechanism in which auditors audit directors' job execution.
In addition, BIL has introduced an executive officer system as an internal organization, whereby executive operations and supervision are separated in an effort to ensure swift decision-making and strengthen governance. Executive officers are elected by the board of directors, and are responsible for overseeing the operations of businesses, departments, and group subsidiaries under their supervision.
Independent Outside Directors
BIL appoints independent outside directors to ensure objective and neutral oversight of management from an external point of view, and thereby strengthens its management oversight function. BIL's independent outside directors provide management advice, decide important matters, and oversee executive operations based on their respective abundant experience, careers, and insights from perspectives independent of BIL's management.
Nomination Committee and Compensation Committee
In order to enhance the independence and objectivity of the board of directors' functionality concerning the appointment and remuneration of directors and executive officers, BIL has established the Nomination Committee and the Compensation Committee as arbitrary advisory committees of the board of directors. Each of the committees consists of seven directors*, including five outside directors and two internal directors, and appoints an outside director as its chairperson.
The Nomination Committee creates standards for the appointment of directors and executive officers, selects candidates, develops a CEO succession plan, and so forth, and reports them to the board of directors.
The Compensation Committee creates policies and a system of remuneration for directors and executive officers, reviews the remuneration standard and the remuneration amount of respective individuals, and reports them to the board of directors.
To enhance the Effectiveness of the Board of Directors
At BIL, respective directors and auditors every year evaluate the effectiveness of the board of directors and report the results to the board of directors. Based on this evaluation, the board of directors analyzes and assesses the effectiveness of the entire board of directors and discloses an overview of the results in the "Corporate Governance Report." The board of directors will endeavor to further enhance its effectiveness based on opinions provided by respective directors and auditors.
- Corporate Governance Report [PDF/244KB] (Last update: June 27, 2018)
- As of June 26, 2018
Brother Industries, Ltd. Governance Structure (As of June 26, 2018)
Risk Management System
BIL has established the Risk Management Committee headed by the Representative Director & President as an independent executive management organization, whereby the crucial risks of the whole Brother Group are identified and assessed, and proper actions for those risks are formulated. The committee promotes the upgrading of internal controls and risk management structures.
The Risk Management Committee manages the following risk subcommittees to control the critical risks of the group in a comprehensive and systematic fashion, overseeing activities of the subcommittees to respond to the respective risks. When the potential impact of a risk is assessed at the highest level, the Risk Management Committee switches into emergency response mode and gives priority to dealing with the situation.
The Compliance Committee makes the workforce aware of the importance of complying with laws and business ethics and prevents violations and recurrences through education programs and activities.
Committee of Security Trade Control
The Committee of Security Trade Control ensures the proper management of export transactions and technological offerings based on laws and regulations. The Committee of Security Trade Control is also working to maintain and improve the management level by staging meetings to discuss important matters every time laws are amended, implementing internal audits, and offering guidance and education to group companies.
Product Liability Committee
The Product Liability Committee is held periodically to ensure product safety in R&D, design and production, sale and use, repair and service, and disposal through coordinated efforts.
Information Management Committee
To cope with risks associated with information leaks, the Information Management Committee determines a suitable policy for managing information on customers and other aspects of the business retained by the company, and deploys it throughout the group.
Safety, Health, and Disaster Prevention Committee
The Safety, Health, and Disaster Prevention Committee discusses annual plans, devises and implements measures, and conducts awareness activities for the purpose of ensuring employee safety and health, preventing disasters, and minimizing the damage from such disasters.
The Environmental Committee is chaired by the environmental officer and includes executive officers and above who are in charge of development, technology, production, and general affairs fields. The committee regularly discusses and determines measures for environmental issues (Climate change, Compliance with Environmental Laws and Regulations on Products and pollution, etc.) that must be dealt with by the whole Brother Group.