MA N AG E M E N T R E POR T

Corporate GovernanceCorporate Governance
The Tokyo Electron Group is improving and reinforcing its internal control systems andrisk management structures, with the aim of maximizing its corporate value.

Corporate Governance Policies
The Tokyo Electron Group is seeking to enhance its
corporate governance through a variety of measures topromote management focused on maximizing corporate
value and raising shareholder satisfaction. We haveestablished and operate optimal and highly effective
structures of governance that are based on our three basic
principles for reinforcing corporate governance.

Basic Principles of Corporate Governance

HIGHLIGHT

1. Ensuring the transparency and soundness of businessmanagement
2. Facilitating quick decision-making and the efficient
execution of business management
3. Disclosing information in a timely and suitable manner

EHS REPORTMANAGEMENT REPORT

Corporate Governance Structures
The members of the Tokyo Electron Group are companies
that have statutory auditors. In April 2003, an executive
officer system was introduced to clarify the roles of theBoard of Directors and executive bodies and to facilitate
faster decision-making, as well as to propose and implement
timely business strategies.

Internal Control Systems and Risk
Management System
The Tokyo Electron Group is taking measures to reinforce
internal control systems to make them more effective,
with the goal of raising corporate value and engaging in
responsible conduct towards all stakeholders. The Group
engages in practical activities in accordance with thebasic policy on internal controls (established in May 2006
and revised in April 2008) and complies with the internal
control requirements concerning financial reporting
pursuant to the Financial Instruments and Exchange Act.
In order to construct and reinforce more internal
controls and risk management structures so that they
become more effective, a Chief Internal Control Director
was appointed in June 2008, and then in April 2009 an
Executive Officer in charge of Compliance & Internal
Control was appointed and the Risk Management & Internal
Control Department was established.
In addition, the Global Audit Center was established as
an internal audit organization in order to perform businessaudits of domestic and overseas group business sites;
perform compliance audits; assess whether internal control
systems are functioning effectively; and provide support toworkplaces when necessary for operational improvements.

■ Framework for Corporate Governance, Internal
Board of Directors
The Board of Directors has 13 members, of whom two are
outside directors. The term of office for directors is set atone year to enable the Board to make timely and flexible
responses to changes in the business environment and tocreate structures in which managerial responsibilities areclear.
The Board has a Compensation Committee1 made up of
all directors, excluding representative directors (chairman& CEO and president), and a Nomination Comittee2 tofurther improve governance.
1 Compensation Committee: Makes a draft remuneration plan for the chairman& CEO and the president and presents the draft to the Board of Directors
2 Nomination Committee: Selects candidates for directorships for submission
to the annual shareholders’ meeting and a candidate for CEO, to be approvedby the Board of Directors

Control System and Risk Management System
Annual Shareholders’ Meeting

Compensation Committee
Board of Nomination Committee
Directors Chief Business Ethics Director

SOCIAL REPORT10The Board of Statutory Auditors is comprised of four
statutory auditors, of whom two are outside auditors.
Statutory auditors attend meetings of the Board ofDirectors and other key meetings, conduct business audits,financial audits, and risk management evaluations, and also
audit the performance of duties by directors. The Board ofStatutory Auditors met six times in the fiscal year ended
March 2009.

TOKYO ELECTRON Environmental and Social Report 2009

Independent
Auditors

Chief Internal Control Director

Confirms the progress of improvements
and provides instruction

Representative
Directors

Request for improvement/Report

Request for
improvement

Compliance & Internal
Control Executive Officer

ReportAudit andimprovement
reports

ExecutiveOfficers
ReportBoard of Statutory Auditors

StatutoryAuditors

Request forimprovement

Committees
s %THICS #OMMITTEEs Information Security Committee
s %XPORT 4RANSACTION
Monitoring Committee

Internal Audit Dept.
(Global Audit Center)

Audit

Risk Management andInternal Control Dept.
Request for improvement/
ReportMonitoring

Administrative Dept.

Checks and balances

Business Dept.