Fujikura Ltd.

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Governance

Organizational Governance

Corporate Governance

Efforts on Corporate Governance

Fujikura believes the corporate governance system discussed herein is optimal for achieving its growth strategies. In light of this, Fujikura has adopted the “company with audit and supervisory committee” organizational structure to establish the corporate governance system outlined herein.

(1) Enhancing the Decision-making Capabilities of the Board of Directors

Fujikura needs to build a structure whereby the Board of Directors thoroughly and extensively explores important matters, including the annual and mid-term business plans, which are the core of our growth strategies, and large-scale M&A deals, so that proper decisions can be rendered. To facilitate this approach, in addition to our internal executive directors, who are well-versed in the businesses managed by each in-house company, Fujikura also plans to enlist several outside directors to take advantage of their diverse knowledge and objective opinions, which are not influenced by Fujikura’s internal state of affairs. Fujikura believes that engaging outside directors will facilitate the establishment of a structure whereby the Board of Directors can thoroughly and extensively explore and discuss vital matters to arrive an optimal decision.

At present, there are four outside directors: two with corporate management experience (in the finance and manufacturing industries, respectively) and two others (one a lawyer and the other a certified public accountant).

(2) Delegation of Authority to Directors Engaging in the Execution of Business Operations

The main businesses of Fujikura are organized into three in-house companies (the Power & Telecommunication Systems Company, Electronics business Company, and Automotive Products Company). An executive director is assigned to an in-house company to handle oversight. Fujikura believes that a flexible system needs to be put in place to facilitate quick and decisive decision-making by said executive directors on items exclusive to the in-house company and on matters with a relatively minimal degree of risk. To this end, Fujikura plans to delegate a significant amount of authority to the executive directors in charge of management of the in-house companies.

And also Fujikura has set up a Nominating Advisory Committee and Remuneration Advisory Committee, both composed of a majority of outside directors, to nominate individuals to the position of executive director and to decide on appropriate remuneration. There is a system in place to ensure each committee objectively evaluates candidates and remunerations. Fujikura believes this boosts incentives to motivate executive directors to improve the performance of the in-house company they are put in charge of.

Corporate Governance Structure

Organization of the Fujikura Corporate Governance Sysytem

Female Director

There is no female director.

Outside Directors

Fujikura has a total of 14 directors, of which four (4) are independent outside directors. The independent outside directors have a diverse background. One (1) is a lawyer, one (1) is a CPA, and two (2) have management experience (finance and manufacturing industries). These independent outside directors actively participate in discussions held by the Board of Directors and use their diverse knowledge and specialized expertise to offer up opinions. Furthermore, the incorporation of objective opinions not influenced by internal circumstances at Fujikura into Board discussions contributes to the enhancement of the Board of Directors’ decision-making. The following are criteria for determining independence of outside directors at Fujikura.

Fujikura has determined that the four (4) outside directors satisfy all of the following requirements to serve as an independent outside director.

  • *1Major client refers to a person/company that accounts for 1% or more of Fujikura’s consolidated net sales or a person/company that earns 1% or more of their consolidated net sales from Fujikura
  • *2Person/company executing business on someone’s behalf refers to a director engaging in the execution of business operations or an employee working under said director
  • *3Substantial contributions refers to annual amounts in excess of ¥10 million yen

Corporate Governance Code

The status of corporate governance including our response to corporate governance code is announced in "Corporate Governance Report" published in "Investor Relation" - "Corporate Governance".

Responsibility to Stakeholders

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