Corporate Governance

Basic Approach

The MEDIPAL Group ensures sound, transparent management and places importance on maximizing corporate value.

The Group also believes that appropriately disclosing high-quality information is one of its responsibilities to stakeholders and enhances the soundness and transparency of management. Therefore, the Group proactively discloses quarterly explanations of financial results and other information.

Corporate Governance System

The Board of Directors of MEDIPAL HOLDINGS CORPORATION (the Company) includes 11 Directors (9 men and 2 women ; 4 outside directors) and considers and decides matters stipulated by management policy and by law, as well as other important matters concerning corporate management, and also supervises the status of overall business execution. The Board holds monthly meetings and, when necessary, extraordinary meetings. Audit & Supervisory Board Members attend these meetings. Representative directors of main consolidated subsidiaries are appointed as directors of the Company to share information.

The Company has also adopted the executive officer system to clearly separate the functions of management decision making and supervision from business execution. Senior managers of main consolidated MEDIPAL Group companies are appointed as executive officers of the Company with the objective of upgrading and improving the corporate governance system. They periodically exchange information, as well as deliberate and conduct studies, which helps maintain organizational unity.

In addition, to promote efficient Group management activities, representative directors, directors, and representative directors of consolidated subsidiaries designated by the president form the Group Presidents Meeting. Functioning as an advisory council, the Group Presidents Meeting convenes once a month, in principle, to share information on the Group’s management strategies and deliberate and consider business solutions.

Also, the Audit & Supervisory Board includes 5 Audit & Supervisory Board Members (of which 3 are outside members). Audit & Supervisory Board Members attend the previously mentioned meetings and conduct strict audits of the legality and adequacy of directors’execution of business based on the standards determined by the Audit & Supervisory Board, and exchange information with the public accountants.

The MEDIPAL Group’s Audit & Supervisory Board Members also exchange information and cooperate with each other.

As a measure to enhance corporate governance the Nomination and Compensation Committee will be voluntarily established as an advisory body to the Board of Directors for the purpose of improving the fairness, transparency and objectivity of procedures related to the nomination and compensation of directors.The Nomination and Compensation Committee shall, in response to requests from the Board of Directors, discuss and report to the Board of Directors on the following matters.

(1) Matters related to nomination
  a. Policy on appointment and dismissal of directors
  b. Matters concerning appointment and dismissal of directors
    (matters subject to resolution by the General Meeting of Shareholders)
  c. Matters concerning appointment and dismissal of representative directors
  d. Matters concerning appointment and dismissal of executive directors
  e. Matters concerning succession plans
(2) Matters related to compensation
  a. Policy on compensation, etc. of directors
  b. Matters concerning director compensation limits
    (matters subject to resolution by the General Meeting of Shareholders)
  c. Matters concerning compensation of individual directors

(3) Other important management matters the Board of Directors deems necessary
The Nomination and Compensation Committee will be composed of three or more members appointed by resolution of the Board of Directors, with a majority of the members being outside directors and an outside director serving as the chair of the Committee.

The president and representative director will assume the role of Chief Compliance Officer to promote compliance management under the leadership of the MEDIPAL Group’s top management.
And, to promote compliance systematically and continuously, the Corporate Compliance Office will be established as an organization directly under the president, and will be tasked with further strengthening compliance throughout the MEDIPAL Group.MEDIPAL will further enhance compliance education across the MEDIPAL Group, and the Board of Directors will also work to improve corporate governance by creating a structure for monitoring the Groups compliance.

Corporate Governance System