Skip to main content

Hitachi

Hitachi Transport System

CSR Management

Corporate Governance

Our corporate governance philosophy is that, along with efforts to increase management transparency and efficiency, we must improve corporate value and achieve sustainable development through business activity based on compliance and ethical conduct. We will follow these ideas as we establish a healthy, highly transparent corporate governance system that will enable us to nimbly respond to changes in the business environment. As part of this effort, the Company has been using "Nominating committee, etc. system" in which management oversight and business execution functions are separate.
Under the system, substantial authorities related to business execution are delegated from the Board of Directors to executive officers, who make prompt decision making about business restructuring and strategic investments. Executive Committee meeting consisting of all executive officers is held twice a month in general to discuss material subjects which have impacts on the Company and the entire Group and clarify responsibilities and authorities of the executive officers. Three committees, Nominating Committee, Audit Committee, and Compensation Committee are set up within the Board of Directors, with majority of members consisting of outside directors, to segregate duties and strengthen oversight function. We enacted our "Corporate Governance Guidelines" to provide the basic views, framework and charter of our corporate governance.

Corporate Governance System

As of June 23, 2017

Corporate Governance System

Board of Directors

Board of directors decides the company´s management policy and matters concerning allocation of functions of executive officers, and oversees the operations of directors and executives. It is held regularly (if necessary, temporarily). Three committees (Nominating, Audit and Compensation) are established in it to strengthen oversight function. Audit Committee consists of 3 outside directors to strengthen oversight function much more.

[Standards for Appointment Outside Directors]

The Company invite outside directors with extensive experience and knowledge of management to bring in outside objective opinions in order to enhance corporate governance and to improve transparency and ensure objectivity in management. To assess independence of outside directors objectively, the Company established our own "Independence Standards for Outside Directors" by reference to the Listing Regulations of Tokyo Stock Exchange, Inc. and the independence standard of proxy advisors, and outside directors to whom none of the standards applied will be appointed as independent officer without the possibility of any conflict of interest with general shareholders.

[Independent Standards for Outside Directors]

(a)
A director, corporate auditor, accounting advisor, executive officer, corporate officer, manager and any other person equivalent thereto of a corporation or organization that holds 10% or more of the outstanding shares of the Company, either directly or indirectly, as of the end of the previous fiscal year (collectively, "Related Party"), or those who had been a Related Party in the last five years.
(b)
A Related Party of subsidiaries of corporation or organization described in (a).
(c)
A Related Party of a corporation or organization where 10% or more of its outstanding shares are owned, either directly or indirectly, by the Company as of the end of the previous fiscal year.
(d)
A Related Party of a company whose transaction volume with the Company accounts for 2% or more of the Company's consolidated service revenues for the previous fiscal year, or those who had been a Related Party in the last five years of such company.
(e)
A Related Party of a business partner that receives payments from the Company and its consolidated subsidiaries that account for 2% or more of such company's consolidated service revenues for the previous fiscal year, or those who had been a Related Party in the last five years of such business party.
(f)
A Related Party of a financial institution from which the Company borrows the amount that accounts for 2% or more of the Company's consolidated total assets, or those who had been a Related Party in the last five years of such financial institution.
(g)
A consultant, or accounting or legal professional who receives cash or other economic benefits equal to 10 million yen or more per year (average annual amount if the payment covers multiple fiscal years) in the last five years in addition to Director's remuneration from the Company.
(h)
A person who received donation or financial assistance equal to 10 million yen or more per year from the Company during the previous fiscal year, or those who belong to the recipient organization.
(i)
A Related Party of a company that accepts director(s) or auditor(s) from the Company or its consolidated subsidiaries, or its parent company or consolidated subsidiaries.
(j)
Spouses or relatives by blood or affinity within the second degree of kinship of those described in (a) through (i) (excluding those who are not in an important position such as officer).
(k)
Spouses or relatives by blood or affinity within the second degree of kinship of an executive director, executive officer, corporate officer, or manager or employees of the Company or its consolidated subsidiaries ("Executive"), or those who had been an Executive in the last ten years, and a Related Party of the Company or its consolidated subsidiaries.

Executive Committee

Executive committee investigates important matters concerning operational execution affecting on the Company and the entire group. Executive committee consists of all executives and those who are especially nominated by president and is held regularly (if necessary, temporarily).

Executive Officers

Executive officers execute operations except those Executive Committee considers. Authority has largely being transferred from the board. This has enabled rapid decision-making.

Compensation of Directors and Executive Officers

Policy for setting remuneration of Board of Directors and executive officers

  1. Policy Setting Method
    The Company, pursuant to the provisions of the Companies Act relating to incorporated companies with nominated committees, has established a policy for the Compensation Committee regarding the determination of the amount of individual compensation to be awarded to directors and executive officers.
  2. Basic Policy
    Directors compensation levels are set at an appropriate level for the ability and responsibilities required by the post, taking into account compensation levels at other companies.
  3. Board of Directors Remuneration
    Remuneration of directors is composed of a monthly salary and a year-end bonus. The monthly salary is decided by reflecting the full-time or part-time status and position. The amount of year-end benefit is predetermined as approximately 10% of the annual compensation, which is calculated based on the monthly salary, but subject to reduction depending on the Company's performance. The director's compensation is not paid to directors who also serve as an executive officer.
  4. Executive Officers Compensation
    The compensation of executive officers consists of monthly salary and performance fee. The monthly salary is decided by adjusting a basic amount set according to the relevant position to reflect the results of an assessment. The base amount of the performance fee is determined as approximately 30% of the annual compensation, and the amount to be paid is determined according to the performance and responsible role within a certain range.
Download Adobe Reader
In order to read a PDF file, you need to have Adobe® Reader® installed in your computer.