Seven Prioritized
Initiatives

7Governance

Human Rights

LaborPractices

Environment

Fair Trade

ConsumerIssues

Community

Strengthening Corporate GovernanceCorporate Governance

Response to Amendments of the Companies Act and Corporate Governance Code● Basic Concept

and investigate the measures.

FDK transitioned to a company with an audit and supervisory committee andFDK Group conducts reviews of the management system as necessary for● Audit and Supervisory Committee

released a corporate governance report in June 2016 in accordance withas items to comply to in FDK governance report in addition to respond toeach measure based on the general principles of the Corporate Governance

The Audit and Supervisory Committee is composed of three directors,

amendments to the Companies Act in 2015 as well as the formulation of theamendments in the Companies Act.

Code stipulated by the Financial Instruments Exchange as well as establishes

including two outside directors, with meetings held once a month andCorporate Governance Code by the Financial Instruments Exchange.

organizations and introduces other necessary measures because it

whenever else a meeting is deemed appropriate to monitor and audit thebelieves strengthening corporate governance improves the soundness andappropriateness and validity of management. Furthermore, each Audit andtransparency of the company and improves the value for FDK shareholders.

Supervisory Committee member attends the Board of Directors meetings toIn FY2016, FDK endeavored to improve matters of explanation as well

Disclosure Based on Principles of the Corporate Governance Code30 Principles

38 SupplementaryPrinciples

1. Securing the Rights and Equal Treatment of Shareholders

79

Five General Principles

FDK strives to heighten fairness and transparency with broad disclosure

share objective and fair insight about overall management and each matterof information such as the provision of financial information via the Internet

while also auditing the appropriateness and validity of business operations

while working to quickly release management information.

of the directors according to the auditing policies formulated by the Audit

2. Appropriate Cooperation with Stakeholders Other Than Shareholders

53and Supervisory Committee.

3. Ensuring Appropriate Information Disclosure and Transparency

24

4. Responsibilities of the Board of Directors FY2016 reformation/enhancement matters1419

5. Dialogue with Shareholders

23Moreover, FDK has introduced a corporate officer system composed ofthree directors and corporate executive officers as well as eight corporate

FDK established an Audit and Supervisory Committee Office on April

officers to operate businesses that separate the auditing of management

1, 2017 with the purpose to facilitate high-quality auditing and supervisionand the business operating system.

as well as to contribute to the strengthening of governance through● Board of Directors

smooth informational sharing between outside directors who are Audit andThe FDK Board of Directors is composed of four directors (excludingSupervisory Committee members. FDK aims to improve the effectivenessdirectors who are Audit and Supervisory Committee members) and threeand efficiency of auditing with close links that include bilateral informational

directors who are Audit and Supervisory Committee members. Board ofexchange and sharing of opinions between the Audit and Supervisory

Directors meetings are held once every month to determine importantCommittee, Audit and Supervisory Office, Accounting Auditors, and themanagement matters and deliberate the progress status of performance

Auditing Department.

Shareholders Meeting
Nomination/Dismissal

Audit and Supervisory Committee
Audit and Supervisory Committee Members
Directives

Auditing/
Supervision

Nomination/
Dismissal

Nomination/
Dismissal/
Auditing

Auditing
Reporting

Audit and Supervisory Committee Office

ReportingBoard of Directors

FY2015 Status
Comply 65 items / Explain 8 items of the 73 items
Challenges (items to explain): Items related to outside directors
and settlement for exercise of voting rights electronicallyCommittee*As of April 1, 2017

Link●● Transitioned to a Company with an Audit and Supervisory

Corporate Governance Framework

Nomination/
Dismissal

Either comply with a principle or, if not, explain the reasons why not to do so for the 73 items above“Comply or Explain”

Accounting Auditors

LinkAuditing

President & CEO

Department for Internal Auditing(Auditing Department)
Auditing

ReportingManagement Meetings(Decisions about Business Operations)

Governance Code(1) Director Trainingof the Companies Act put in place May 2015. FDK has transitioned to a

FDK held training for directors three times a year with the objective tocompany with an audit and supervisory committee after approval at thereaffirm expert knowledge and learn things outside of that expertise in an87th Annual Shareholders Meeting held June 28, 2016 with the objective ofeffort to increase the expertise and knowledge of FDK directors.

strengthening corporate governance while enhancing supervising functions(2) Effective Assessment of the Board of Directorsof Directors and realizing management with a high-level of transparency.

FDK dug deeper into the heart of challenges and enhanced assessment

Conventional
Governance
Framework

Board ofDirectors

Corporate
Governance Framework
After Transition
Board ofDirectors

Each Department and Group Company

Board ofAuditors

Internal Control● Enhancing and Strengthening General Principle 4:

as a new institution of the company in accordance with the amendments

Directives/SupervisionCorporate Officers

FY2016 Status
Complied with 72 items / Explained 1 items of the 73 items
Challenges (items to explain): Approval for exercise of voting rights electronicallyResponsibilities of the Board of Directors in the Corporate

FDK transitioned to a company with an audit and supervisory committee

Transitioning to a Company with an Audit and Supervisory Committee

Link●Audit andSupervisory
Committee
Primarily
composed ofoutside directors

methods in an effort to take action to strengthen supervising functions
by incorporating interviews through third-party institutes in addition toevaluation methods through conventional questionnaires.

・EnhancesSupervising
Functions・Complies
with theCompanies
Act and CGC

・Strengthen
Corporate
GovernanceDirector Training● Basic Concept

19

As a means to fulfill corporate social responsibilities, FDK Group approved

FDK stakeholders from employees to suppliers and local communities

the Basic Policy for Establishing an Internal Control System at thewhile ensuring the appropriateness of operations and reliability of financial

Board of Directors meeting by recognizing the necessity of strengthening

reporting in addition to realizing management that complies with relevant

corporate governance to maintain a sound and strong relationship withlaws and the Articles of Incorporation.

FDK GROUP CSR REPORT 2017

FDK will enhance and strengthen corporate governance by extracting prioritized initiatives related to the Corporate Governance Code every year from FY2017.

FDK GROUP CSR REPORT 201720