Corporate Governance

Corporate Governance System

Basic Policy to Corporate Governance

Corporate governance is based on our corporate philosophy: "We are committed to harnessing nature's gifts, to bringing taste and fun, and to contributing to healthy life styles." We believe that strengthening and enhancing corporate governance is crucial in order to meet the expectations of stakeholders including customers, business partners, employees and their families, and local communities, and to increase corporate value.

Calbee's Corporate Governance System

Major Items Contents
Systems of board governance systems Company with auditors
Number of directors
(of whom, outside directors)
8
(5)
Number of Audit & Supervisory Board members
(of whom outside Audit & Supervisory Board members)
3
(3)
Number of meetings of the Board of Directors
(FY2020/3)
13
(Attendance ratio: 97%)
Number of meetings of the Audit & Supervisory Board (FY2020/3) 14
Term of office for directors 1 year
Term of office for Audit & Supervisory Board members 4 years

Transition of Corporate Governance System Enhancement

2001Separation of supervision and business execution
  • ・Adopted an executive officer system
  • ・Appointment of outside directors
2009Enhance supervisory and monitoring functions Promotion of Diversity
  • ・Reduced number of internal directors from nine to two
  • ・Increased the number of outside directors from two to five
  • ・Appointed the first non-Japanese director
2010Enhancing management transparency and soundness
  • ・Established an Advisory Board (Currently Nominating Commitee / Compensation Commitee)
2014Clarification of management responsibility
  • ・Reduced director terms from two years to one year
2019Strengthen of management structure
  • ・Increased the number of internal directors by two, Board of Directors increased from six to eight

Calbee's Corporate Governance Code

The Tokyo Stock Exchange’s Corporate Governance Code has been applied to all listed companies in 2016. In response, we have formulated our own original corporate governance code that reflects our vision and systematizes our attitude regarding corporate governance.

Organization of Corporate Governance

Appointing Directors and Audit & Supervisory Board Members

Policy

We have a core policy that Board of the Directors is composed of a majority of independent directors. We are actively promoting the Board's diversity by appointing members with differing personal histories, genders, and nationalities. In addition, we are focusing on a balanced combination of directors with backgrounds in many different areas of expertise, such as the food industry, general industry, academia, and journalism. Evaluations of the independence of directors and Audit & Supervisory Board members are conducted based on the standards established by the Tokyo Stock Exchange.

Processes

The nomination of candidates for outside directors is decided upon approval at the General Meeting of Shareholders, after being reviewed by the Advisory Board and recommended by the Board of Directors. Regarding the nomination of candidates to the Audit & Supervisory Board candidates must have a strong will to respond submission from shareholders with background in finance, accounting and/or law. Candidates are deliberated by the Board of Directors. After which, they are approved by Audit & Supervisory Board members, and them decided on at the General Meeting of Shareholders.

Executive Remuneration

Our remuneration system for internal directors and senior executive officers is determined through a highly transparent and objective system that is decided at the Board of Directors’ meetings and involves reviews conducted by the Compensation Committee. About two-third of this remuneration is performance-linked. We designed the system this way so that it would be connected with shareholder interests from a medium- to long-term perspective. Additionally, we pay our outside directors basic remuneration only, as they are in positions independent from business execution.

Fixed remuneration: One-third of total executive remuneration
Basic remuneration Monetary rewards as compensation for executive duties*1
Variable remuneration: Two-third of total executive remuneration
Bonuses Cash linked to the business results during the fiscal year*2
Retirement bonuses Cash linked to the business results during the period of appointment paid at the time of retiring
Performance-based stock compensation

Stock compensation linked to the business results of each fiscal year paid at time of retiring*3

  • *1 Basic remuneration for directors shall not exceed annual remuneration limits determined by the General Meeting of Shareholders.
  • *2 Remuneration shall not exceed 1.5% of the respective fiscal year’s consolidated ordinary profit.
  • *3 Paid for the fiscal years between 2021 and 2023 in which performance targets were achieved; Total amount shall not exceed 1% of consolidated net profit targets.

Risk Management

In order to deal with the diverse business risks (natural disasters and accidents, legal violations and litigation, quality, procurement of raw materials, stocks, intellectual property infringements, etc.) faced by the Company, we have formulated “Risk Management Rules,” and identify and evaluate the business risks of each internal companies, headquarters, and Group companies during the process of establishing an internal control system. In particular, regarding quality risks for our products and raw material procurement, the Quality Assurance Division plays a central role in implementing preventive measures. In addition, we have a system that enables us to respond to promptly throughout the Company. Going forward, we will to promote to establish a system to prevent risks in advance, minimize damage, and ensure rapid recovery. As for information security risks, we have put in place an internal system that can respond to security incidents. Also, we continue to enlighten and educate employees as preventive measures.

Risk Management System

Based on “Basic policy of Internal Control Systems” resolved by the Board of Directors, we have established the following compliance and risk management system. The Ethics and Risk Management Advisory Board, which includes external experts, has been established to promote a highly independent and transparent system. In addition, the Ethics and Risk Management Committee was established to decide on the policies compliance and risk countermeasures, and the Compliance and Risk Management Promotion Committee at each of our internal companies, headquarters, and domestic group companies is responsible for implementing these measures.

Organization of Compliance and Risk Management