Soundness and transparency of management

From the perspective of increasing the soundness and transparency of management, the Company has in place a corporate governance structure and internal control systems to establish and build optimal corporate governance. As a Company with a Board of Directors and an Audit & Supervisory Board, the Board of Directors, comprising seven (8) directors (including three (4) Outside Directors), makes decisions on important matters of the Company. The Directors report on the status of the execution of their duties at least once every three months and whenever otherwise necessary, and the status of execution of operations by the Directors is supervised. The Audit & Supervisory Board comprises three (3) highly independent Outside Audit & Supervisory Board Members (including one (1) full-time Audit & Supervisory Board Member). In addition to exercising its authority as set forth in laws and regulations from an independent standpoint, it coordinates with the Internal Audit Office and the Accounting Auditor to audit the Directors’ execution of their duties, including the status of the establishment and implementation of internal control systems, in accordance with the Regulations of the Audit & Supervisory Board.

Status of establishment of corporate governance structure

The Company has, with certain exceptions (establishment of optional committees in which main members consist of Independent Outside Directors), completed its actions on the individual principles described in the Japan’s Corporate Governance Code set forth by the Tokyo Stock Exchange, Inc.