June 28, 2022

Company name: UT Group Co., Ltd.
Representative:

Yoichi Wakayama, President,
Representative Director & CEO(Securities code: 2146, TSE Prime Market)
For inquiries:

Takahito Yamada, Senior Executive
Officer and Division Manager,
General Affairs DivisionTEL:+81-3-5447-1710

Notice Regarding Partial Revision of Basic Policy on Internal Control System
At the Board of Directors meeting held on June 25, 2022, UT Group Co., Ltd. resolved to partially revise
its Basic Policy on Internal Control System as follows. The key points of the revision is to reflect thetransfer of the corporate system from the Company with an Audit & Supervisory Board to the Company
with an Audit & Supervisory Committee, which was approved at the 15th Annual General Meeting of
Shareholders. The revised policy was adopted on the same day.
(Revised parts in the Japanese original text: Underlined)(Revised parts only in the English text for grammatical and other reasons: Double-lined)
Previous
1.

Revised

System to ensure execution of duties by

1.

System to ensure execution of duties byDirectors and employees of the Company inDirectors and employees of the Company inconformity with laws and regulations andconformity with laws and regulations andthe Articles of Incorporation of the Company

the Articles of Incorporation of the Company(1) and (2) (Omitted)(1) and (2) (Omitted)(3)

The UT Group Action Guidelines and the UT(3) The Code of Conduct and the UT Group

Group Compliance Code of Conduct stipulate

Compliance Code of Conduct stipulate

appropriate actions to comply with laws andappropriate actions to comply with laws andregulations, social norms, internal rules andregulations, social norms, internal rules andother rules to be taken. The Company strives toother rules to be taken. The Company strives tomake directors and employees of the Group to

make officers and employees of the Group to be

be well aware of this and comply with it.

well aware of this and comply with it.

2.

(Omitted)

2.

(Omitted)

3.

Regulations and other organizational

3.

Regulations and other organizational

structures to manage risk of losses

structures to manage risk of losses
1 / 11

(1) The UT Group Compliance Risk Management(1) The UT Group Compliance Risk Management

Conference determines the types of risks of theConference determines the types of risks of theCompany and its Group to be managed, controls

Company and its Group to be managed, controls

and evaluates these risks, takes steps to preventand evaluates these risks, takes steps to prevent

risk occurrence, and, in the event of risk

risk occurrence, and, in the event of risk

occurrence, minimizes loss and establishes

occurrence, minimizes loss and establishes

recurrence prevention measures.

recurrence prevention measures.

(2) In case of an emergency, the Company takes(2) In case of an emergency, the Company takes

prompt, appropriate action in accordance withprompt, appropriate action in accordance with

the Rules on Emergency Response, which aims

the Rules Concerning Emergency Response,at minimizing damage. An emergency

which aims at minimizing damage. An

headquarters, led by the President &emergency headquarters, led by the President &Representative Director, will be in charge ofRepresentative Director, will be in charge ofcrisis management.

crisis management.

4. System to ensure efficient execution of duties

4. System to ensure efficient execution of duties

by Directors of the Company

by Directors of the Company(1) A regular Board of Directors meeting is held once

(1) A regular Board of Directors meeting is held oncea month and an extraordinary Board of Directors

a month and an extraordinary Board of Directors

meeting is held as needed; all are to decide on

meeting is held as needed; all are to decide on

important matters and supervise the execution ofimportant matters and supervise the execution ofduties by Directors among other activities. The

duties by Directors among other activities.

term of office for Directors has been set as one
year in order to cope with the rapidly-changing
management environment in an agile manner.
5.

(3)

System to ensure appropriate operations of5.

System to ensure appropriate operations ofa corporate group that consists of thea corporate group that consists of theCompany and its subsidiaries

Company and its subsidiaries

The UT Group Compliance Risk Management(3)

The UT Group Compliance Risk Management

Conference is in charge of and promotes

Conference is in charge of and promotes

compliance of the entire Company Group, andcompliance of the entire Company Group, andthe Company’s Internal Audit Division audits its

the Company’s Internal Audit Division audits its

subsidiaries in accordance with thesubsidiaries in accordance with theManagement Regulations of Subsidiaries andManagement Regulations of Subsidiaries andAffiliates and the Internal Audit Regulations andAffiliates and the Internal Audit Regulations andfrom the perspective of matching with laws andfrom the perspective of matching with laws andregulations, the Articles of Incorporation,

regulations, the Articles of Incorporation,
2 / 11internal rules, and other rules.
(4)

6.

internal rules, and other rules.

The UT Group Action Guidelines, Group(4)The Code of Conduct, UT Group Compliance

Compliance Code of Conduct, and UT Group

Code of Conduct, and UT Group Compliance

Compliance Manual have been adopted by the

Manual have been adopted by the entire

entire Company Group. The Company strives toCompany Group. The Company strives to makemake directors and employees of the Group

directors and employees of the Group

Companies to be well aware of taking

Companies to be well aware of taking

appropriate actions in compliance with laws andappropriate actions in compliance with laws andregulations, social norms, internal rules andregulations, social norms, internal rules andother rules.

other rules.

Matters concerning the employee in the6.

Matters concerning the Director andevent that Audit & Supervisory Board

employee who assist auditing duties of theMembers request him or her to assist in

Audit & Supervisory Committee; matterstheir auditing duties; matters concerning

concerning independence of the Director

independence of the employee fromand employee from Directors (excluding

Directors; and matters concerning securing

Directors who are Audit & Supervisory

effectiveness of instructions by Audit &Committee Members); and matters

Supervisory Board Members to theconcerning securing effectiveness of

employee

instructions to the employee(1) Upon resolution by the Audit & Supervisory(1) When requested by the Audit & Supervisory

Board and at the request for assistance by Audit

Committee, an employee who performs& Supervisory Board Members, an employee

assistance to duties of the Committee will be

who performs accounting audit duties

selected and be dedicated to performing

assistances will be selected and be dedicated toassistance to the Audit & Supervisory

performing assistance to Audit & Supervisory

Committee. With regard to nomination ofBoard Members. With regard to nomination of

personnel, Directors (excluding Directors who

personnel, Directors exchange opinions withare Audit & Supervisory Committee Members;

Audit & Supervisory Board Members and obtainreferred as “Audit & Supervisory Committee

their agreement.

Members” hereafter) exchange opinions with
the Audit & Supervisory Committee and obtainits agreement.

(2) Directors do not have the authority to issue(2)

Directors (excluding Audit & Supervisoryorders to the employee who performs

Committee Members) do not have the authority

assistance. The employee follows orders fromto issue orders to the employee who performs

Audit & Supervisory Board Members.

assistance. The employee follows orders fromthe Audit & Supervisory Committee.

(3) Disciplinary action to the employee who(3)
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Disciplinary action to the employee who

performs assistance needs to be agreed by Audit

performs assistance needs to be agreed by the& Supervisory Board Members.

Audit & Supervisory Committee.

7. System for Directors and employees of the7.

System for Directors and employees of theCompany and its Group Companies to reportCompany to report to the Audit &to Audit & Supervisory Board Members andSupervisory Committee and systems for

systems for others to report to Audit &others to report to Audit & Supervisory

Supervisory Board Members

Committee(1) In order to understand important decision-(1) In order to understand important decision-

making processes and the status of execution of

making processes and the status of execution ofduties, Full-time Audit & Supervisory Board

duties, Audit & Supervisory Committee Members

Members attend important meetings, including

attend the Board of Directors meetings and otherthe Board of Directors meetings and the UT

important meetings, inspect major requests forGroup Compliance Risk Management

approval and other important documents

Conference, inspect major requests for approval

concerning execution of duties, and request

and other important documents concerning

explanation to Directors and employees as

execution of duties, and request explanation toneeded.

Directors and employees as needed.
(2) Audit & Supervisory Board Members collaborate(2) The Audit & Supervisory Committee collaborates

with the Auditing Company by receiving briefings

with the Auditing Company by receiving briefings

on accounting audit details and exchanging

on accounting audit details and exchanging

information.

information.

(3) Audit & Supervisory Board Members can request(3) The Audit & Supervisory Committee can request

reporting on execution of duties to Directors andreporting on execution of duties to Directors andemployees of the Company’s subsidiaries, who

employees of the Company’s subsidiaries, whoin turn shall promptly respond to the request. The

in turn shall promptly respond to the request.

Company makes Directors and employees of the

The Company makes Directors and employees

Company’s subsidiaries to be well aware of thisof the Company’s subsidiaries to be well aware

point. In case they detect a violation to laws andof this point. In case they detect a violation toregulations or its possibility, they promptly reportlaws and regulations or its possibility, they

it to Audit & Supervisory Board Members.

promptly report it to the Audit & Supervisory
Committee.

(4) Concerning information on the whistle-blower(4) Concerning information on the whistle-blower

system common to the Company and its Groupsystem common to the Company and its Group

Companies, departments in charge regularly

Companies, departments in charge regularly

report to Audit & Supervisory Board Members.

report to the Audit & Supervisory Committee.

(5) The Company prohibits any party from treating(5) The Company prohibits any party from treating

the whistle blower to Audit & Supervisory Board
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the whistle blower to the Audit & Supervisory

8.

Members in any manner disadvantageous on theCommittee in any manner disadvantageous on

grounds of the whistle-blowing disclosure andthe grounds of the whistle-blowing disclosure

seeks that Directors and employees be welland seeks that Directors and employees be wellaware of this point.

aware of this point.

Policy on procedures for advance payment

8.

Matters concerning policy on procedures foror redemption of expenses arising fromexpenses arising from performance ofperformance of duties of the Audit &duties of the Company’s Audit &Supervisory Board Members and other

Supervisory Committee Members

settlement of expenses or debts arising

Directors (excluding Audit & Supervisoryfrom performance of such duties

Committee Members) cooperate with audit by

Directors cooperate with audit by Audit &Audit & Supervisory Committee Members andSupervisory Board Members and budget abudget a certain amount for the payment ofcertain amount for the payment of expenses

expenses and other costs arising from theand other costs arising from the performance ofauditing to secure its effectiveness.

duties of Audit & Supervisory Board Members.
9. Other arrangements to ensure that audits by

9.

Other arrangements to ensure that audits by

Audit & Supervisory Board Members are

the Audit & Supervisory Committee isconducted effectively

conducted effectively(1) Audit & Supervisory Board Members audit(1) Audit & Supervisory Committee Members audit

execution of duties by Directors and Executive

execution of duties by Directors and Executive

Officers based on the Audit & Supervisory Board

Officers based on the Audit & Supervisory

Members’ Auditing Standards and according toCommittee’s Auditing Standards and according

the audit plan.

to the audit plan.

(2) Audit & Supervisory Board Members attend the(2) Audit & Supervisory Committee Members attend

Board of Directors meetings, Management

the Board of Directors meetings and otherCommittee, and other important meetings, andimportant meetings, and provide their opinions

provide their opinions as needed.

as needed.

(3) Audit & Supervisory Board Members regularly(3) Audit & Supervisory Committee Members

exchange information and collaborate with theregularly exchange information and collaborate

Auditing Company and the Internal Audit

with the Auditing Company and the Internal Audit

Division, and have regular meetings with theDivision, and have meetings with the President &President & Representative Director.

Representative Director as appropriate.

10. System to ensure credibility in financial

10. System to ensure credibility in financial

reporting(1) (Omitted)

reporting(1) (Omitted)
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(2) Audit & Supervisory Board Members conduct(2) The Audit & Supervisory Committee conducts

audits concerning financial reporting internal

audits concerning internal control related tocontrol, in accordance with the Audit

financial reporting, in accordance with the Audit

Performance Standard Concerning Internal& Supervisory Committee’s Audit PerformanceControl System.

Standard Concerning Internal Control System.

(3) In case that Audit & Supervisory Board Members(3) In case that the Audit & Supervisory Committee

determine that the financial reporting internal

determines that the internal control related tocontrol does not address significant risks, theyfinancial reporting does not address significant

discuss the matter in the Audit & Supervisoryrisks, the Committee points it out to Officers in

Board meeting as needed, point it out to Officers

charge of finance in a timely and appropriate

in charge of finance in a timely and appropriatemanner, and ask for improvement as is deemedmanner, and ask for improvement as is deemednecessary.

necessary.
11. Basic Views on Eliminating Anti-Social

11. Basic Views on Eliminating Anti-Social
ForcesForces and arrangements

As a part of systems to ensure appropriatenessAs a part of systems to ensure appropriatenessof operation, the Company’s basic views onof operation, the Company’s basic views on

eliminating anti-social forces are clearly statedeliminating anti-social forces are clearly statedas follows and the systems are established asas follows and the systems are established.

described:(1) (Omitted)(1) (Omitted)(2) Arrangements for eliminating anti-social forces(2) Arrangements for eliminating anti-social forces

1. (Omitted)

1. (Omitted)

2. The Company and its Group Companies

2. The Company and its Group Companies

have stipulated in the Standard on

have stipulated in the Standard on

Eliminating Anti-Social Forces and the

Eliminating Anti-Social Forces and theDetailed Rules on Investigating and

Detailed Rules on Investigating andEliminating Anti-Social Forces measures

Eliminating Anti-Social Forces measuresneeded to eliminate anti-social forces from allneeded to eliminate anti-social forces from allactivities including contracts exchanged by

activities including contracts exchanged by

the Company and its Group Companies.

the Company and its Group Companies.

3. (Omitted)

3. (Omitted)

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<Reference> Basic Policy on Internal Control System (Full version)
1.

System to ensure execution of duties by Directors and employees of the Company inconformity with laws and regulations and the Articles of Incorporation of the Company(1) Important matters concerning execution of business that may affect the Company and its entire
Group are identified and discussed at the Board of Directors meeting. The President &Representative Director reports the status of business execution of the Company and mattersdeemed important to the Board of Directors. In addition, External Directors are selected tomaintain and enhance supervisory functions concerning execution of duties by Directors.
(2) The UT Group Compliance Risk Management Conference, chaired by the lead person in chargeof the compliance division and with participation by an outside lawyer among others, has been
established as an advisory entity serving the Board of Directors. The Conference discusses
compliance policy and action plans of the Company and its Group, studies matters needed toensure legal compliance and fair execution of duties, does research on violation of laws,
regulations, and internal rules, and establishes recurrence prevention measures.
(3) The Code of Conduct and the UT Group Compliance Code of Conduct stipulate appropriate
actions to comply with laws and regulations, social norms, internal rules and other rules to betaken. The Company strives to make officers and employees of the Group to be well aware ofthis and comply with it.
(4) Concerning promotion of compliance, the Company has established the UT Group Compliance
Manual. Officers and employees of the Company and its Group Companies attend seminars andother events and are instructed to perform duties and management by taking compliance as oneof their own issues in their respective position.
(5) A whistle-blower system has been established to enable consulting on possible or actualorganizational or individual legal violations or fraudulent acts and to appropriately handle theinformation. By making use of the system, the Company endeavors to prevent scandals causedby fraudulent and other acts, detect problems early, and become more agile in improving its
ability to govern itself.
(6) The Internal Audit Division has been established to examine, evaluate, and report the status ofcorporate organization establishment and compliance, effectiveness and efficiency of business
management to maintain and improve internal control.

7 / 112. System to ensure the preservation and management of information related to execution ofduties by Directors(1) The minutes of the Board of Directors meetings and related materials are properly preserved andmanaged in accordance with laws and regulations as well as the Company’s Document
Management Regulations and Board of Directors Regulations.
(2) Concerning information management and periods of retention, the Information Security
Management Regulations and the UT Group Compliance Manual have been established to put inplace a system to retain and manage information.
3. Regulations and other organizational structures to manage risk of losses(1) The UT Group Compliance Risk Management Conference determines the types of risks of theCompany and its Group to be managed, controls and evaluates these risks, takes steps to prevent
risk occurrence, and, in the event of risk occurrence, minimizes loss and establishes recurrence
prevention measures.
(2) In case of an emergency, the Company takes prompt, appropriate action in accordance with theRules Concerning Emergency Response, which aims at minimizing damage. An emergency
headquarters, led by the President & Representative Director, will be in charge of crisis
management.
4. System to ensure efficient execution of duties by Directors of the Company(1) A regular Board of Directors meeting is held once a month and an extraordinary Board of
Directors meeting is held as needed; all are to decide on important matters and supervise theexecution of duties by Directors among other activities.
(2) The Company has defined resolution matters and reporting matters of the Board of Directors
meeting in the Board of Directors Regulations, and responsibility and authority of eachorganization and each job position concerning execution of duties in the Job Position Authority
Regulations.
(3) The Company has also adopted an Executive Officer System to separate business supervisory
functions and business execution functions and improve effectiveness of the Board of Directors
by granting a part of the Board of Directors’ decision-making authority of business execution to
Executive Officers.
(4) In the Management Committee, which is chaired by the President & Representative Director andis comprised of Full-time Directors and Executive Officers, important matters concerning
execution are discussed.

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5. System to ensure appropriate operations of a corporate group that consists of the Company
and its subsidiaries(1) As a holding company that controls the business of its Group, the Company appropriately
exercises rights of shareholders to its subsidiaries from the perspective of maximizing corporate
value of its Group. The Company also regularly receives reporting from its subsidiaries on theirstatus of management, execution of duties, and financial position, in accordance with the“Management Regulations of Subsidiaries and Affiliates,” and the Management Committee
confirms whether Directors of Group Companies efficiently execute their duties.
(2) With regard to management of the Company’s subsidiaries, Directors of the Company’s Group
Companies who concurrently serve as the Company’s Executive Officers, or Directors of theCompany’s Group Companies who are elected by the Company ensure that the Company’s priorapproval is required for the subsidiaries’ important matters, including business strategy andbusiness plans, which is based on the Company Group Policy. In principle, a subsidiary of theCompany’s subsidiary is managed and controlled through the subsidiary.
(3) The UT Group Compliance Risk Management Conference is in charge of and promotes
compliance of the entire Company Group, and the Company’s Internal Audit Division audits its
subsidiaries in accordance with the Management Regulations of Subsidiaries and Affiliates andthe Internal Audit Regulations and from the perspective of matching with laws and regulations,
the Articles of Incorporation, internal rules, and other rules.
(4) The Code of Conduct, UT Group Compliance Code of Conduct, and UT Group Compliance
Manual have been adopted by the entire Company Group. The Company strives to makedirectors and employees of the Group Companies to be well aware of taking appropriate actions
in compliance with laws and regulations, social norms, internal rules and other rules.
6. Matters concerning the Director and employee who assist auditing duties of the Audit &Supervisory Committee; matters concerning independence of the Director and employee
from Directors (excluding Directors who are Audit & Supervisory Committee Members); andmatters concerning securing effectiveness of instructions to the employee(1) When requested by the Audit & Supervisory Committee, an employee who performs assistanceto duties of the Committee will be selected and be dedicated to performing assistance to the
Audit & Supervisory Committee. With regard to nomination of personnel, Directors (excluding
Directors who are Audit & Supervisory Committee Members; referred as “Audit & Supervisory
Committee Members” hereafter) exchange opinions with the Audit & Supervisory Committee andobtain its agreement.
(2) Directors (excluding Audit & Supervisory Committee Members) do not have the authority to issueorders to the employee who performs assistance. The employee follows orders from the Audit &Supervisory Committee.
(3) Disciplinary action to the employee who performs assistance needs to be agreed by the Audit &Supervisory Committee.
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7. System for Directors and employees of the Company to report to the Audit & Supervisory
Committee and systems for others to report to Audit & Supervisory Committee(1) In order to understand important decision-making processes and the status of execution ofduties, Audit & Supervisory Committee Members attend the Board of Directors meetings andother important meetings, inspect major requests for approval and other important documents
concerning execution of duties, and request explanation to Directors and employees as needed.
(2) The Audit & Supervisory Committee collaborates with the Auditing Company by receiving
briefings on accounting audit details and exchanging information.
(3) The Audit & Supervisory Committee can request reporting on execution of duties to Directors andemployees of the Company’s subsidiaries, who in turn shall promptly respond to the request. The
Company makes Directors and employees of the Company’s subsidiaries to be well aware of thispoint. In case they detect a violation to laws and regulations or its possibility, they promptly report
it to the Audit & Supervisory Committee.
(4) Concerning information on the whistle-blower system common to the Company and its Group
Companies, departments in charge regularly report to the Audit & Supervisory Committee.
(5) The Company prohibits any party from treating the whistle blower to the Audit & Supervisory
Committee in any manner disadvantageous on the grounds of the whistle-blowing disclosure andseeks that Directors and employees be well aware of this point.
8. Matters concerning policy on procedures for expenses arising from performance of duties of
the Company’s Audit & Supervisory Committee Members
Directors (excluding Audit & Supervisory Committee Members) cooperate with audit by Audit &Supervisory Committee Members and budget a certain amount for the payment of expenses andother costs arising from the auditing to secure its effectiveness.
9. Other arrangements to ensure that audits by the Audit & Supervisory Committee isconducted effectively(1) Audit & Supervisory Committee Members audit execution of duties by Directors and Executive
Officers based on the Audit & Supervisory Committee’s Auditing Standards and according to theaudit plan.
(2) Audit & Supervisory Committee Members attend the Board of Directors meetings and otherimportant meetings, and provide their opinions as needed.
(3) Audit & Supervisory Committee Members regularly exchange information and collaborate with
the Auditing Company and the Internal Audit Division, and have meetings with the President &Representative Director as appropriate.

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10. System to ensure credibility in financial reporting(1) In order to ensure appropriate accounting treatment and improve credibility in financial reporting,
the Company has adopted diverse types of regulations concerning accounting operations, has
assigned an Officer in charge concerning information disclosure, and strives to put in place aninternal control system concerning financial reporting and to enhance its effectiveness.
(2) The Audit & Supervisory Committee conducts audits concerning internal control related tofinancial reporting, in accordance with the Audit & Supervisory Committee’s Audit PerformanceStandard Concerning Internal Control System.
(3) In case that the Audit & Supervisory Committee determines that the internal control related tofinancial reporting does not address significant risks, the Committee points it out to Officers incharge of finance in a timely and appropriate manner, and ask for improvement as is deemednecessary.
11. Basic Views on Eliminating Anti-Social Forces and arrangements
As a part of systems to ensure appropriateness of operation, the Company’s basic views on
eliminating anti-social forces are clearly stated as follows and the systems are established.
(1) Basic views on eliminating anti-social forces
As a basic policy, the Company Group is determined to stand against anti-social forces thatthreaten civil society and eliminate any relationship with them. The Group prohibits all Directors
and employees to use anti-social forces and any individual or group that is related to them, andto be related with them in any way, including provision of money and cooperation.
(2) Arrangements for eliminating anti-social forces
1. The Company has adopted the UT Group Compliance Manual, which calls for elimination of
any relationship with anti-social forces and strives to make Directors and employees of theGroup to be well aware of and comply with it.
2. The Company and its Group Companies have stipulated in the Standard on Eliminating AntiSocial Forces and the Detailed Rules on Investigating and Eliminating Anti-Social Forces
measures needed to eliminate anti-social forces from all activities including contracts
exchanged by the Company and its Group Companies.
3. In case that the Company is contacted by anti-social forces, the Company’s department incharge is prepared to deal with it in cooperation with police and lawyers.
End

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