Corporate governance


Basic Approach

Takamiya Group believes that the basic foundation for sound corporate governance involves thoroughly enforcing compliance, ensuring the transparency and efficiency of management, and working to maximize corporate value for all stakeholders, including shareholders and investors.
We will establish a temporary equipment industry that is clearly recognized as sound by the general public and investors and achieve perpetual development within a highly transparent business environment by pursuing high-quality corporate activities centered on the stable supply of safe and high-added-value temporary equipment. We will also implement efforts to improve the position of our industry for the interests of our users and the entire industry, in addition to the Group’s development.

Corporate Governance System (As of March 31, 2020)

The Company has in place a system under which the Board of Directors, which includes Outside Directors, provides strategic guidance and management supervision and a Board of Corporate Auditors, whose members, including Outside Auditors, audit Directors’ execution of duties by attending and giving their opinions at various important meetings, such as those of the Board of Directors and the Board of Executive Officers. The Company has also introduced an Executive Officer system under which Executive Officers are appointed separately from Directors, who are elected in accordance with Japan’s Companies Act. While the Board of Directors makes decisions on important managerial matters and supervises Directors’ execution of duties, having Outside Directors enables the inclusion of diverse points of view in decision-making.
The Company's Board of Directors consists of eight Directors of outstanding character, possessing insight, capabilities, abundant experience and high ethical standards.
Factors such as expertise in management, sales and marketing, technology, overseas business, finance and accounting, and law, as well as differing backgrounds and experience, were taken into consideration when selecting the Board of Directors’ members.
In addition, two Independent Outside Directors and two Independent Outside Corporate Auditors are always in attendance at meetings of the Board of Directors.
A structure is in place that allows for honest opinions, advice, and comments from an independent and objective perspective regarding management matters, in addition to important matters related to nomination and remuneration.
As such, the transparency and objectivity of the Company’s Board of Directors are ensured. However, gender diversity is insufficient. We recognize finding and selecting the appropriate individuals for positions is an issue for us. We will consider an effective governance structure from all aspects to further strengthen transparency and objectivity going forward.

Status of Members of the Board and Corporate Auditors
(As of June 25, 2020. Figures on the meeting attendance and attendance rate are for the fiscal year ended March 2020.)
Structure of the Board of Directors
Name Current positions Board of Directors
Meeting attendance/ Attendance rate
Expertise Reason for appointment
Kazumasa Takamiya Representative Director,
President and Chairman
17 times/100% Management Has led the Group with experience and a high level of knowledge related to corporate management and strong leadership
Akiyoshi Takamiya Representative Director,
Executive Vice President
Supervisor of Product Development Division
Sales & Marketing Division
17 times/100% Management and sales & marketing Is well acquainted with the Group’s overall business operations and management, particularly in the sales & marketing divisionx
Hideki Yasuda Director and Managing Executive Officer
Division General Manager of
Business Management Division
17 times/100% Finance and accounting Has abundant experience and extensive knowledge in the administrative division, particularly in finance and accounting
Tsutomu Abe Director and Executive Officer
Division General Manager of
Sales & Marketing Division
17 times/100% Sales & marketing Has abundant experience in the construction-use temporary equipment and materials industry and extensive knowledge related to sales & marketing in general
Yuki Mukaiyama Supervisor of Overseas Business Division, Global Procurement Division, Business Development Division 15 times/88% Overseas, management and new business Has abundant overseas management experience including serving as the representative of an overseas subsidiary, and is well acquainted with new business development
Yasunori Nishioka Director and Executive Officer
Division General Manager of
Manufacturing Division
Supervisor of Scaffolding Quality Assurance Division
17 times/100% Management, finance, overseas, manufacturing and quality control Has abundant management experience at financial institutions, experience in international business, and management experience at a manufacturing subsidiary, and is well acquainted with the Company’s manufacturing division
Kouji Shimokawa Director
Outside
Independent
17 times/100% Taxes and accounting Is qualified as a tax accountant and has abundant experience and extensive knowledge from many years of involvement in managerial accounting that would be useful in the Company’s management
Noboru Furuichi Director
Outside
Independent
16 times/94% Financing, finance and management Has been responsible for a wide range of financial advisory operations at securities firms for many years, and has advanced management decision-making capabilities, and abundant experience and knowledge that would be useful in the Company’s management
Structure of the Board of Corporate Auditors
Name Current positions Board of Directors Meeting attendance/ Attendance rate Board of Corporate Auditors Meeting attendance/ Attendance rate Expertise Reason for appointment
Yasushi Shimizu Corporate Auditor (full-time) -
Note:
Appointed in June 2020
IT Has abundant experience and extensive knowledge in the administrative division, particularly in control information management system
Yoshihiro Sakatani Corporate Auditor
Outside Independent
16 times/94% 13 times/93% Finance and accounting Is qualified as a certified public accountant, has considerable knowledge of corporate finance and accounting, and his advice on the Company’s management from the perspective of finance and accounting as appropriate will contribute to the soundness of accounting for the Company
Teiji Joko Corporate Auditor
Outside Independent
15 times/88% 11 times/79% Law Is qualified as a lawyer and can be expected to perform objective and neutral audits from the perspective of compliance. It was deemed he would appropriately fulfill his duties as an Independent Corporate Auditor
Criteria for the Appointment of Directors and Corporate Auditors

The appointment and dismissal of candidates for Directors and Corporate Auditors are determined by a meeting of the Board of Directors with Independent Outside Directors and Independent Outside Corporate Auditors in attendance, based on relevant regulations including the Regulations for Professional Organization of Officers. Comprehensive consideration is given to the career history, track record, knowledge, experience and capabilities of each candidate. Furthermore, the opinions of Outside Officers are requested in advance when necessary, and the Board of Corporate Auditors’ consent is obtained in advance for the appointment of Corporate Auditor candidates.

Selection Criteria

1. Directors
The basic requirements for Director candidates are having outstanding character and insight, as well as being such individuals as will contribute to the growth and improvement in the corporate value of the Company and the Group. The candidates must have high levels of knowledge and judgment capabilities in each business field.
Outside Director candidates are required to have a high level of expertise in a field such as taxation, accounting, law or management. They must be able to actively state opinions from an objective and external viewpoint, reflecting a diverse background.

2. Corporate Auditors
The basic requirements for Corporate Auditor candidates are having high ethical standards and objective, fair and impartial judgment capabilities. The candidates must also have the appropriate experience and capabilities as Corporate Auditors and a high level of expertise in a field such as taxation, accounting, law or management. In addition to the above requirements, Outside Corporate Auditors are required to have no conflicts regarding their independence.
For the dismissal of Officers, if an Officer has deviated from the above appointment criteria and his or her dismissal has been objectively deemed appropriate, a resolution shall be made at a meeting of the Board of Directors with Independent Outside Directors and Independent Outside Corporate Auditors in attendance, after sufficient discussions have been held.

Appointment and Dismissal of the Chief Executive Officer

The Company has not established voluntary advisory committees or set any uniform standards on the appointment and evaluation regarding the appointment and dismissal of the President, who is the Chief Executive Officer. However, if it has been objectively deemed that dismissal would be appropriate in the case of a violation of laws, regulations, or the articles of incorporation, or a significant degradation of the Company’s corporate value, a resolution shall be made at a meeting of the Board of Directors with Independent Outside Officers in attendance, after sufficient discussions have been held.

Succession Plan

The Company does not currently have a specific plan for successors for positions such as the Chief Executive Officer.
However, we recognize succession planning as an important management issue and we are nurturing candidates from the management team (Directors and Executive Officers). We will continue to engage in constructive discussions on the approach to the appropriate implementation and supervision of succession planning at Board of Directors meetings.

Evaluations of the Effectiveness of the Board of Directors

Since the fiscal year ended March 31, 2018, the Company has conducted questionnaires with Directors and Corporate Auditors regarding the effectiveness of the Board of Directors.
Analyses and evaluations on the structure and operations of the Board of Directors and the role of Board of Directors were also conducted to determine management strategy and supervisory function.
In the fiscal year ended March 31, 2020, the Board of Directors raised points for improvement, such as the necessity to further enhance discussions between departments, but it was judged that the Board has largely maintained its effectiveness. We will further improve the effectiveness of the Board of Directors based on these analyses and evaluations going forward.

Remuneration for Directors and Corporate Auditors

Remuneration System for Directors and Corporate Auditors

The remuneration of Directors consists of basic remuneration according to their position, performance-linked remuneration (bonuses) as a short-term incentive linked to singleyear performance, and stock-based remuneration stock options positioned as a medium- to long-term incentive.
The remuneration of Outside Officers consists only of basic remuneration from the perspective of their roles and independence. The fixed remuneration of Directors is determined by the Board of Directors within the limit of total remuneration provided for in a resolution by the General Meeting of Shareholders. The remuneration is based on the presentation of a payment proposal by the Representative Director and President to the Board of Directors. He or she prepares the proposal by extensively considering factors including each Director’s position, the evaluation on the performance of duties, and the performance of the Company.
He or she also seeks advice from Independent Outside Directors. For bonuses that are short-term, performancelinked remuneration, a proposal on the total payment amount is submitted to the General Meeting of Shareholders if the single-year consolidated operating income target is achieved. Bonuses are determined and paid within the total payment amount provided for in the resolution. The remuneration amount for each Director is at the discretion of the Representative Director and President. For stock-based remuneration stock options, which are a medium- to longterm incentive, within the limit of total stock options provided for in a resolution by the General Meeting of Shareholders, a proposal for granting stock options based on the position factor set in the Company’s regulations is submitted to the Board of Directors, which determines and grants the stock options.

Communications with Shareholders and Investors

We endeavor to provide shareholders and investors with timely information in a transparent, fair and consistent manner. As well as striving to disclose information in accordance with appropriate disclosure regulations, we work proactively to disclose information that is effective in fostering a better understanding of the Company. We aim to expand the number of shareholders and investors and are attempting to increase their understanding of our business activities, strategies and performance through direct communications.
Specifically, we hold meetings and financial results briefings with analysts and institutional investors, as well as make our financial results briefing videos and materials available to the public. Moreover, we release the videos and materials of our financial results briefing to the public in Japanese and English. We also publish our convocation notices in Japanese and English on the Internet, and hold thorough briefing sessions for individual investors. Our main investor relations activities in the fiscal year ended March 31, 2020 were as follows:

For Individual Investors For Analysts and Institutional IR Website
Briefings for individual investors: Six times
(Total participants: Approximately 300)
Financial results briefings: Two times (Year-end video streaming and end of the second quarter)
One-on-one meetings: 90
https://www.takamiya.co/en/ir/
We hold regular briefings at the Security Analysts Association of Japan as well as at branches of securities companies, with our Officers as speakers. Our IR website indicates the timing of this disclosure. At our semi-annual results briefings, the President and Chairman and other Company Officers summarize our performance and provide earnings forecasts. Materials and videos are available on our IR website. To ensure the timeliness and fairness of disclosure, we disclose materials on our IR website in a timely manner. This information includes analyst reports and historical data. We also provide in-depth content to help further understanding of our business and strategy.

Risk Management, Internal Control and Compliance

The Basic Rules for Risk Management stipulate the basic policy and other matters concerning risk management. In addition, we have established the Risk and Compliance Committee, with the General Affairs Department acting as the administrative office. The Committee discusses issues and measures regarding the promotion of Company-wide risk management in order to appropriately manage and respond to the variety of risks that surround our businesses.
For internal control, we have developed a system in which internal checking operates between departments and clarifies the division of duties by establishing internal regulations and other rules. In addition, the Basic Policy for Internal Control and the Basic Policy for Financial Reporting outline systems to

Internal Control

For internal controls, we have developed a system in which internal checking operates between departments and clarifies the division of duties by establishing internal regulations and other rules. In addition, the Basic Policy for Internal Control and the Basic Policy for Financial Reporting outline systems to ensure that the Directors comply with laws and the articles of incorporation when conducting operations, and also to ensure proper operations of the Company.

Compliance system

we have outlined the Compliance Standards and the Code of Conduct in the Compliance Manual. We have established the Risk and Compliance Committee, with the General Affairs Department acting as the administrative office, to discuss specific compliance initiatives to implement internally and to identify at early stages legal issues emerging in the Company. Through these efforts, we aim to further raise and promote compliance awareness, especially concerning legal issues. Additionally, we seek advice and guidance as needed from our corporate lawyers regarding our daily operations and managerial decisions.

ESG