Strategy

Corporate Governance

The Group believes that it wants to become a corporate group that continues to support the intellectual activities of customers through our products and services, expressing this as "KOKUYO aims to be a Life & Work Style Company that contributes to society by realizing an 'improvement in the Quality of Life' of customers to enhance the way they work, learn, and live, by providing value that enhance their creativity through our products and services." The Group believes that the securing management efficiency, transparency, and fairness are important elements in order to realize the continuous and long-term increase in corporate value. We will engage in efforts to continuously enhance these elements in constructing and operating our management system.

Corporate Governance System

The KOKUYO Group is a company that has the Board of Auditors. We have created a corporate governance system that consists of the Board of Directors that supervises the execution of business, and the Board of Auditors that, as an entity independent of the Board of Directors, audits the duties executed by the directors. We strive to build corporate governance that is worthy of our shareholders' trust. To realize this goal, we work to enhance our supervisory function, clarify the responsibilities of management at all levels, and heighten the objectivity and transparency of business administration.

1. Entities Related to the Board of Directors and Execution of Business

KOKUYO Group's Board of Directors is comprised of a total of eight members, three of which are outside directors. As part of a system that is able to respond promptly to changes in the business environment, directors are appointed for a term of one year.
KOKUYO Group has separated its supervisory and executive functions and, in order to promote faster decision-making and streamlined business execution, adopted a corporate officer system. The Board of Directors, which assumes a supervisory function, makes crucial decisions on such matters as group-wide management policies and various business plans.
Also, as an entity responsible for business execution, it runs the Headquarters Management Board.
This board is comprised of Group Headquarters Operating Officers, the head of which is the President and CEO, and its main functions are to deliberate and make decisions on issues related to the Group Headquarters.

2. Advisory Body for the Board of Directors

As an advisory body for our Board of Directors, we have in place a Nominating and Compensation Committee, majority of which consists of external members or directors.
The Nominating and Compensation Committee reviews, appoints, and dismisses candidates for director, auditor, and operating officer (hereinafter collectively referred to as "officers"). It also deliberates on compensation plans, evaluates individual officers, and verifies remunerations, and offers reports and recommendations regarding such matters to the Board of Directors.

3. Board of Auditors

KOKUYO Group's Board of Auditors is comprised of one full-time outside auditor and three outside statutory auditors who possess a wealth of knowledge and experiences in a wide range of fields.
The auditors attend the Board of Directors and other important meetings to audit the legality of the duties executed by the directors.
Moreover, to ensure the effectiveness of audits, the auditors exchange opinions regularly with personnel in charge of various duties and functions, as well as have in place a system for working closely with the Internal Audit Division and the auditors of the main subsidiary companies.

4. Internal Audit Division

We have established an Internal Audit Division for our internal audit system, and the Company and its affiliated companies are subject to audits At the Headquarters Management Board, audit reports are made directly to the President and executive officers, and activities reports are also made to the Board of Directors as appropriate.
The persons in charge of internal audits, the auditors, and the corporate auditors hold meetings on a regular basis, exchange opinions and information, and strengthen mutual collaboration. The full-time auditors are also present for the audit reports that are made at the Headquarters Management Board. In addition, auditors also conduct exchanges of opinions and information on a regular basis with the auditors of Group consolidated subsidiaries.

KOKUYO GROUP COVERNANACE SYSTEM

Corporate Governance Guidelines

The "KOKUYO Corporate Governance Guidelines" have been established for the purpose of clarifying the basic concepts and policies in order to improve corporate governance, and, when necessary, verifying the effectiveness and appropriateness thereof.

Corporate Governance Guidelines (described in Japanese)PDFF84kb84kb

Basic Policy of Internal Control System

KOKUYO Group created, maintains, and continuously works on improving and enhancing its internal control system to ensure that business is carried out correctly, efficiently, and without fraudulence. Resolution of the "Basic Policy of Internal Controllership System," as passed by the Board of Directors, is outline as follows:

Basic Policy of Internal Controllership System (described in Japanese)PDFF84kb712kb

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