Duskin ensures the implementation of all of the principles contained in the Corporate Governance Code. For additional information, please refer to the Corporate Governance Report on our website.
We are working to strengthen corporate governance, as we believe it to be one of the most important issues for management. In 2017 we created a Directors Evaluation Committee and introduced an Operating Officer System. With the aim of ensuring the independence of the Directors Evaluation Committee and maintaining its effectiveness, we mandated that only independent directors be members and made the committee an advisory body to the Board of Directors.
Taking into account amendments to laws and changing society, we will continue to work toward further improvements in corporate governance.
|2003||Organized Quality Assurance Committee (now called CSR Committee)|
|Established Compliance Promotion Committee (now called Compliance Committee)|
|2006||Management philosophy included in the Articles of Incorporation|
|Established a basic policy for the Internal Control System|
|Established Risk Management Committee|
|Duskin stock listed on the first section of Tokyo Stock Exchange and Osaka Securities Exchange*
|2007||Terminated the Directors' retirement benefit program|
|2008||Increased the number of Outside Audit & Supervisory Board Members from two to three|
|2013||Participated in Electronic Voting Platform|
|2014||Increased the number of Outside Directors from one to two|
|2015||Established Outside Directors and Audit & Supervisory Board Members Council|
|Increased the number of Outside Directors from two to three|
|Started to post our shareholders' meeting notice on the internet earlier than distributing print version|
|2016||Started to analyze and evaluate the effectiveness of the Board of Directors|
|2017||Established a share-based-remuneration-type stock option program|
|Introduced Directors Evaluation and Nomination System|
|Organized Directors Evaluation Committee|
|2018||Introduced Operating Officer System|
|Decreased the number of Directors from not more than 15 to not more than 12|
|Independent Outside Directors account for at least one third of all Directors.|
|2019||The Directors Evaluation Committee was changed to consist of only independent directors and to function as an advisory body for the Board of Directors.|
|1||Ratio of Outside Directors on the Board of Directors
|2||Ratio of women on the Board of Directors
|3||Board of Directors attendance rate
|4||Establishment of a Directors Evaluation Committee||
|5||Building a structure that allows Board members to comprehensively deliberate on important matters||
Upholding Founder Seiichi Suzuki's philosophy of Prayerful Management, we are committed to each of our business operations to Sow the Seeds of Joy for people and communities. Our interpretation of corporate governance is for all of our employees to incorporate his earnest wish, as reflected in the philosophy, in our everyday activities.
Duskin positions the strengthening of corporate governance as one of its highest priorities to build a stronger relationship with stakeholders, increase corporate value over the medium- to long-term, and achieve sustainable growth. Duskin is further bolstering its structure, organization and systems to ensure transparent and sound management. Duskin also places compliance at the center of all our corporate activities to continuously improve our corporate value.
Duskin is a company with an Audit & Supervisory Board system. In addition to the Board of Directors and the Audit & Supervisory Board, we have introduced the Operating Officer System to ensure expeditious decision making and business execution. At the Board of Directors, Directors monitor and supervise other Directors' performance. The Audit & Supervisory Board consists of independent outside Audit & Supervisory Board Members capable of objectively conducting audits and internal full-time Audit & Supervisory Board Members, who are well acquainted with our business operations and have skills needed to gather information. Under this system, the Audit & Supervisory Board Members, internal and outside, perform accurate audits. We consider this structure highly effective as it supports customer-oriented management while ensuring sound and efficient business operations. This system also enables us to swiftly and precisely respond to changes in the business environment.
Directors are selected by taking into account the diversity of the board as a whole in terms of abilities, experience, gender and other characteristics. This is for the purpose of enabling the Board to make accurate management decisions in a wide range of business fields while maintaining the soundness, efficiency and effectiveness of the management. The number of Directors is limited to 12. This enables the Board of Directors to focus on making important management decisions and monitoring the execution of business to swiftly and precisely respond to changes in our business environment.
|Name||Title||Attendance in FY2019||CSR Committee||Compliance Committee||Outside Directors and Audit & Supervisory Board Members Council||Directors Evaluation Committee||Risk Management Committee|
|Teruji Yamamura||President & CEO||■19/19||○|
|Kazushi Sumimoto||Director & COO||■19/19||○|
|Director & COO||—||○|
|Director & CFO||—||★|
|Taku Suzuki||Director and Operating Officer||■19/19||○|
|Director and Operating Officer||—||★|
|Tomoya Yoshizumi||Outside Director||■19/19||★||★|
|Nobuko Sekiguchi||Outside Director||■15/15||○||○||○||○|
|Takashi Yoshida||Audit & Supervisory Board Member||■19/19
|Audit & Supervisory Board Member||—||○|
|Takaaki Oda||Outside Audit & Supervisory Board Members||■18/19
|Sachiko Kawanishi||Outside Audit & Supervisory Board Members||■19/19
|Kyoichiro Arakawa||Outside Audit & Supervisory Board Members||■19/19
Duskin has an Outside Directors and Audit & Supervisory Board Members Council, which is an advisory council for the Board of Directors. Its purpose is to provide beneficial views for ensuring effective corporate governance, while enabling Outside Directors to gather information without affecting their independence. This makes it possible to monitor and superviseDuskin's management from a transparent, fair and objective viewpoint.
The Directors Evaluation Committee was established as an advisory body for the President & CEO to consider Director and Operating Officer candidates and their remuneration, which requires the approval of the Board of Directors. In April 2019, this committee was changed to an advisory body for the Board of Directors to improve the effectiveness of the Directors Evaluation and Nomination System. The committee now consists of only independent directors, resulting in greater transparency and objectivity.
To fulfill our corporate social responsibilities (CSR), we have a CSR Committee, which is an advisory council for the Board of Directors. The purpose of the committee is to identify key CSR priorities to be addressed and the scope of our CSR activities in order to implement CSR management across Duskin Group.
|Board of Directors||9 Directors (3 Outside Directors) Observers: 5 Audit & Supervisory Board Members (3 Outside Audit & Supervisory Board Members)||19|
|Audit & Supervisory Board||5 Audit & Supervisory Board Members (3 Outside Audit & Supervisory Board Members)||13|
|CSR Committee||5 Operating Officers (4 are also Directors), 2 Outside Directors, 1 Standing Audit & Supervisory Board Member||2|
|Risk Management Committee||1 Operating Officer, 7 from corporate office departments, and 3 from business divisions Observer: 1 Audit & Supervisory Board Member||2|
|Compliance Committee||7 Operating Officers (2 are also Directors), 2 Outside Directors, 1 Standing Audit & Supervisory Board Member, 1 labor union chair, 1 attorney||4|
|Outside Directors and Audit & Supervisory Board Members Council||3 Outside Directors, 3 Outside Audit & Supervisory Board Members||7|
|Directors Evaluation Committee||2 Outside Directors, 1 Outside Audit & Supervisory Board Member||4|
|Business Strategy Meeting||13 Operating Officers, 3 Outside Directors, 5 Audit & Supervisory Board Members (3 Outside Audit & Supervisory Board Members)||2|
|Operating Officers Board||13 Operating Officers Observers: 2 Standing Audit & Supervisory Board Members||12|
|Budget Meeting||6 Operating Officers (6 are also Directors), 2 Standing Audit & Supervisory Board Members||10|
For the President & CEO to conduct business operations based on the basic management policy established at the Board of Directors meetings, Duskin has an Operating Officers' Board, a deliberative body to examine important business matters.
The Business Strategy Meeting is for all Directors and division managers to discuss comanywide business strategies, business portfolios and the allocation of Duskin Group resources from a medium- to long-term perspective.
The Budget Meeting is held to monitor budget progress for each business division and identify the discrepancies between forecasts and actual results as well as to discuss measures to be taken.
|FY2019 issues||FY2019 initiatives|
|1||Enhanced discussions of management strategies||
|2||Composition of the Board of Directors and development of next generations of executives||
|Initiatives and Improvements|
Duskin selects candidates for election as Directors from among individuals who fulfill the criteria of possessing the character, knowledge and integrity to serve as a Director and who have no health issues that would interfere with performing the duties of a Director.
The Board of Directors makes final selection among candidates who meet the aforementioned criteria.
Under the provisions of Article 427, Paragraph 1 of the Companies Act, Duskin has contracts with Outside Directors that limit their liability as provided in Article 423, Paragraph 1 of this act. The maximum liability under the contracts is the amount as provided in laws and ordinances.
|Name||Reasons for election|
|Tomoya Yoshizumi||Extensive experience and insight in corporate management as a Member of the Board and Corporate Vice President at Ajinomoto Co., Inc., where he was engaged in strategic production planning, the Medium-Term Management Plan and implementing M&A strategies for the Ajinomoto Group. Mr. Yoshizumi supervised business operations from April 2011 in North America as General Manager, North America Division and President of AJINOMOTO NORTH AMERICA, INC.
Since assuming the position of Outside Director at Duskin in June 2017, has strengthened Duskin's corporate governance by providing advice and supervision regarding the Company's overall management from an objective standpoint independent of its executive team. Therefore, Duskin selected him as an Outside Director.
|Nobuko Sekiguchi||After working as a management consultant, Ms. Sekiguchi joined Capcom, where she served as an executive officer responsible for business planning, including the formulation of the Medium-Term Plan, management of the annual budget, organizational reforms, and M&A. Her extensive experience and insights allowed her to strengthen Duskin's corporate governance by providing advice and supervision regarding the Company's overall management from an objective standpoint independent of its executive team. Therefore, Duskin selected her as an Outside Director.|
|Yukiko Tsujimoto||As a director at Procter & Gamble Japan, Ms. Tsujimoto has a wealth of experience and insight in corporate management. As part of her tenure at the company, Ms. Tsujimoto has been responsible for overseeing brand marketing and public relations, as well as serving as PR leader for the Asian region. With her background and knowledge, Ms. Tsujimoto is expected to strengthen Duskin's corporate governance by providing advice and supervision regarding the Company's overall management from an objective standpoint independent of its executive team. Therefore, Duskin selected her as a new Outside Director.|
To ensure the independence of an Outside Director or Outside Audit & Supervisory Board Member, Duskin selects a member in accordance with our own selection criteria as well as the independence standards of the Enforcement Rules for Securities Listing Regulations of the Tokyo Stock Exchange.
When selecting the candidates, Duskin confirms that they comply with all items of the criteria. Then, the Board of Directors makes the final decision.
Duskin positions Directors' remuneration as an important issue for our corporate governance. To raise Directors' motivation to achieve medium- and long-term sustainable growth and enhance corporate value, Duskin established the Directors Evaluation and Nomination System. With this system, their contributions and capabilities are determined and reflected in their remuneration.
The methods used in calculating Director remuneration and actual remuneration in FY2019 are as follows.
|Items||Methods applied in FY2019|
|Directors||Outside Directors||Audit & Supervisory Board Members|
|Type of remuneration||Members|
|Standing Audit & Supervisory Board Members||53,700||46,500||7,200||0||2|
|Outside Audit & Supervisory Board Members||30,000||25,200||4,800||0||3|
Duskin Group places the pursuit of the Economy and Morals in Unity at the heart of our business management. We have formulated the following Code of Conduct Statement to serve as a compass for the realization of our management philosophy as well as Duskin Code of Conduct to define concrete standards of conduct for our business operations.
At Duskin, newly elected Directors and Audit & Supervisory Board Members can attend seminars to receive information about their legal duties and responsibilities. When selecting Outside Directors, the President & CEO explains Duskin's management philosophy and confirms their agreement. Then, Duskin's business strategy and business operations are explained. To help them deepen their knowledge of Duskin, opportunities to visit major business sites, training facilities and plants are provided.
Duskin formulated its succession plan in FY2019 to foster next-generation management and successors to our chief executives. We have created an educational program to train those with the appropriate qualities, as well as a selection process for executive officers and candidates for director positions. We launched these operations in FY2020 and regularly share information and report to the Board of Directors on the progress. The President & CEO conducts monthly individual meetings with all Operating Officers. Quantitative assessments of their performances and improvements are made every six months in line with the Directors Evaluation and Nomination System, with the opportunity used to provide further guidance as well as to review their capabilities and performance with them.
The policy for cross-shareholdings is to hold a suitable number of shares only when there is a legitimate reason for owning these shares. Investments in stocks for which there is no legitimate reason for ownership are reduced or eliminated. Every year, the Duskin Board of Directors determines if the ownership of each cross-shareholding is proper or not. Decisions are based on the need for each cross-shareholding regarding business activities, such as business alliances, maintaining and strengthening business relationships, Duskin's cost of capital, share price movements and other factors.
Duskin conducts a variety of investor relations (IR) and shareholder relations (SR) activities for the purposes of earning trust in the company's management, receiving a proper evaluation of the company, and achieving sustained business growth and medium- to long-term growth in corporate value. Our senior management and Directors protectively respond to the requests of individual or institutional investors to meet with them.
Information, evaluation and opinions gained through IR and SR activities are reported at meetings of the Board of Directors twice each year. In addition, reports as deemed necessary are made by the IR Section to an Operating Officer in charge, then from the Operating Officer to the Board of Directors to reflect this information in the management.
We strive to improve our IR tools, including our website, that are useful for individual investors and shareholders in making investment decisions. Duskin discloses the financial results, business strategies, ESG information, news and other topics of interest.
Duskin holds financial results briefings for institutional investors and analysts twice a year (once when 1H results are announced and once when full-year results are announced). Duskin visits institutional investors and analysts to have active dialogue with them.
The company has postponed briefings due to the spread of the novel coronavirus from February 2020 and meet with them over the phone.
Duskin held its first round-table conference for shareholders on November 14, 2019, with 102 individuals out of 1,419 applicants taking part. In addition to Operating Officers and President & CEO speaking on Duskin's business and history, the meeting provided an opportunity for participants to exchange opinions while enjoying our Mister Donut and other items of our Food Group.
There are no plans at present to hold such events during the current fiscal year.