Corporate Governance
Basic Stance
The NTT Group considers corporate governance to be a matter of vital importance in maintaining the public's trust and ensuring its sustained development. The Group's corporate governance efforts are directed at ensuring the following:
Composition of Board of Directors and Board of Audit
NTT, which is the NTT Group's holding company, maintains a
board of 11 directors, two of whom are outside directors. In principle,
the board of directors meets once per month to make decisions
and report on important management issues.
NTT maintains a board of audit, which is composed of five members
, referred to as corporate auditors, of whom three are outside
corporate auditors.
Senior Management Council and committees
In principle, important company matters are discussed and decided
by NTT's Senior Management Council, which is made up
of the President, Senior Executive Vice Presidents, full-time directors,
and other senior leaders. This council meets once every
week or two, and held 33 meetings in fiscal 2005. As a holding
company responsible for unifying and coordinating NTT Group
activities, NTT also operates a number of committees to discuss
specific matters related to company and group management
strategy and to promote efficient group management. In
principle, each committee is chaired by either the President or
a Senior Executive Vice President, and has a membership composed
of directors and other senior executives involved in the
specific areas for which each committee is responsible. Committee
meetings are held as occasion demands.
In 2005, NTT also established an advisory board for the purpose
of gathering information relevant to management decisions
concerning international business.
Internal Control System
In conjunction with the coming into effect of Japan's new Corporation
Law(Law No.86 of 2005) in May 2006, NTT drew
up and adopted a basic policy related to the creation of a system
of internal controls for the NTT Group as a whole. Our basic
approach to internal controls is as follows:
Details: Internal Control System: Basic policy (in Japanese only)
Audits by the Auditors
Each corporate auditor of NTT audits the performance of NTT's
directors in the execution of their duties as occasion demands.
The corporate auditors also endeavor to strengthen the auditing
system by working closely with the NTT Group's audit firm through
means such as periodic discussion of audit plans and results.
Internal Audits
Internal audits examine the status and operation of internal controls
of the NTT Group as a whole. The Internal Control Office
established in May 2006 will continue the work of building, operating
and improving internal control systems across the NTT
Group, including IT controls.
NTT Group CSR Organization
NTT created a Corporate Social Responsibility (CSR) Committee
chaired by a Senior Executive Vice President in June 2005
to establish a clear management structure for the implementation
of the NTT Group's CSR activities. The CSR Committee
drew up the NTT Group CSR Charter based on its discussions
of the CSR activities of the NTT Group, and it will serve as a
vehicle for ongoing discussions on the implementation of the
NTT Group's CSR initiatives. Group companies are also working
to establish structures, including CSR Committees, to promote
their own CSR initiatives.
;)
Risk Management and Corporate Ethics
Risk Management
The NTT Group functions within a rapidly changing business
climate marked by increasingly fierce competition, and the companies
of the NTT Group also face a wide variety of business
risks from natural disasters and other unforeseen circumstances.
Seeking to minimize potential risks through putting priority on
prevention and readiness, we have prepared a standard manual
for distribution to all member companies to assist in their efforts
to manage business risk and ensure a unified approach to
risk management. With the help of this manual, we work to anticipate
and prepare for risks, so that should they arise, we are
able to minimize the impact on our stakeholders.
Each member company also prepares its own manual or other
mechanisms tailored to its specific business activities and environment
in order to manage and mitigate business risks.
Corporate Ethics
The NTT Group has taken various measures to enhance corporate
ethics based on a core belief that it is imperative to manage
business in compliance with laws and the highest ethical
standards.
In November 2002, we adopted the NTT Group Corporate Ethics
Charter as a code of conduct applying to all directors and employees,
and at the same time set up a Corporate Ethics Helpline.
This facility provides not only an internal helpline for reporting
and consulting on ethics issues by NTT Group employees, but
also an external helpline utilizing the services of attorneys. The
Corporate Ethics Helpline acts on enquiries irrespective of
whether callers choose to remain anonymous or not.
NTT has always taken care to protect the rights of whistleblowers,
but with the coming into effect in April 2006 of Japan's Whistleblower
Protection Act and guidelines for private businesses, we
have revised some of our internal rules and the establishment
as mentioned above of an external helpline for non-employees.
Among other things, each officer and employee, as an officer or employee of a member of a Global Information Sharing Corporate Group, shall keep himself/herself fully aware that any disclosure of customer or other internal privileged information constitutes a materially wrongful act. Also, as a member of a group of companies which holds great social responsibilities, he/she shall strictly refrain from giving or receiving from customers, business partners and other interested parties excessive gratuities.
If he/she is not able to make such a reporting, he/she may contact the "Corporate Ethics Help Line (Consulting Center)". It should be noted that every officer and employee who reports the occurrence of any wrongful act or scandal shall be protected so that the reporting party shall not suffer any negative consequences due to such reporting.
