Overview of Corporate Governance Systems
Last updated : December 27, 2017
NTT believes that raising the effectiveness of corporate governance is an important management issue for meeting the expectations of various stakeholders, including shareholders and other investors, as well as customers, business partners, and employees, and for maximizing corporate value.
Accordingly, NTT is working to strengthen corporate governance based on the purpose of the principles of Japan's Corporate Governance Code, which was put forth by the Tokyo Stock Exchange. Based on the "Towards the Next Stage 2.0" strategy established in May 2015, NTT seeks to accelerate the process of self-transformation to a "Value Partner" and place the entire Group on a profit growth track. To this end, NTT will work to realize its basic policies of ensuring sound management, executing appropriate decision-making and business activities, clarifying accountability, and maintaining thorough compliance.
Overview of Enhancing Corporate Governance System
Corporate Governance System
NTT, in order to strengthen functions for appropriately super-vising business execution, appoints several outside independent Members of the Board and has established the Audit & Supervisory Board, of which outside independent Audit & Supervisory Board Members make up a majority to strengthen its auditing system. Additionally, NTT has voluntarily established the Appointment and Compensation Committee, which consists of four members, including two outside independent Members of the Board, to further increase the objectivity and transparency of decisions relating to appointments and compensation. NTT has determined that governance functions based on the Company with Board of Company Auditors model are sufficiently effective to achieve this purpose.
Business execution at NTT is conducted in accordance with the organizational regulations governing the functions and operations of each organization. Important decisions are made under the supervision of the Board of Directors and based on the responsibility regulations that define the responsibilities and authorities for the president, senior executive vice presidents, and the head of each organization. In addition, NTT has established various meetings and committees as has been deemed necessary to discuss important matters related to corporate management and Group management in order to ensure that appropriate decisions are made for facilitating Group management.
Board of Directors [Number of meetings in the fiscal year ended March 31, 2017: 12]
The Board of Directors consists of 12 Members of the Board, including two outside independent Members of the Board. In principle, the ordinary meetings of the Board of Directors are held once per month. In addition, extraordinary meetings are held as needed. The Board of Directors makes decisions on matters stipulated by law and on important matters related to corporate management and Group management. Moreover, through such means as periodic reports from Members of the Board on the status of the execution of members' duties, the Board of Directors supervises the execution of duties by Members of the Board. The members of NTT's Board of Directors are elected based on having a high level of integrity and insight.
Audit & Supervisory Board [Number of meetings in the fiscal year ended March 31, 2017: 22]
The Audit & Supervisory Board consists of a total of five Audit & Supervisory Board Members, comprising two internal Audit & Supervisory Board Members (one of whom is female) and three outside independent Audit & Supervisory Board Members (one of whom is female). From an independent perspective that differs from that of individuals responsible for business execution, the Audit & Supervisory Board implements operational audits and accounting audits and audits the status of the execution of duties by Members of the Board.
Appointment and Compensation Committee [Number of meetings in the fiscal year ended March 31, 2017: 1]
For the purpose of improving objectivity and transparency in the decisions regarding appointments and compensation of Members of the Board, NTT has established on a non-statutory basis the Appointment and Compensation Committee, which consists of four Members of the Board, including two outside independent Members of the Board, as a preliminary review institution of the Board of Directors.
Executive Officers Meeting [Number of meetings in the fiscal year ended March 31, 2017: 32]
Important corporate matters to be decided are, in principle and in advance, discussed by the Executive Officers Meeting, which is made up of the president, senior executive vice presidents, full-time directors, and the heads of staff organizations. The Executive Officers Meeting is held about once a week. To improve the transparency of management decision-making, one Audit & Supervisory Board Member participates in the Executive Officers Meeting.
A number of committees have been established below the Executive Officers Meeting to discuss specific issues related to corporate and Group management strategies. Major committees include the Technology Strategy Committee, which deliberates on the Group's R&D vision and technology development strategy; the Investment Strategy Committee, which examines investment projects that are larger than a certain scale; and the Finance Strategy Committee, which discusses basic financial strategies and financial issues. These committees, which are convened as necessary throughout the year, are, in principle, chaired by the president or a senior executive vice president and are attended by relevant Members of the Board and others.
|CSR Committee||Formulates basic CSR strategy and CSR goals for the Group, formulates basic policy for CSR-related reports|
|Corporate Ethics Committee||Establishes corporate ethics, takes thorough steps to maintain discipline|
|Human Rights Education Committee||Establishes human rights education systems and responds to discrimination incidents, etc.|
|Technology Strategy Committee||Formulates R&D vision, technology development strategy, and R&D alliance strategy|
|Investment Strategy Committee||Formulates investment strategy related to large investment projects, etc.|
|Finance Strategy Committee||Formulates basic strategies related to finance and policies for addressing financial issues|
|Business Risk Management Committee||Undertakes crisis management for the handling of business risks related to corporate management|
|Disclosure Committee||Establishes policies for compiling yearly reports|
|U.S. Sarbanes-Oxley Act Internal Control Committee||Tracks status of internal control in accordance with the Sarbanes-Oxley Act on a Groupwide basis, verifies and monitors measures to improve deficiencies|
|Group CISO Committee||Formulates of the Group's information security management strategies|
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