Basic Stance and Implementation of Internal Control System
As a holding company, the Company has established the following structure to ensure the sound and continuous development of the Company and the Group under the corporate philosophy of "Benesse (well-being) ."
The Company continuously appoints executive directors and multiple outside directors with a high degree of independence. This ensures that the Board of Directors engages in active debate from a variety of perspectives unconstrained by internal circumstances and maintains and improves its supervisory functions, thereby ensuring execution of its duties.
The Company has established the Nomination and Compensation Committee as an advisory committee to the Board of Directors for the clarification of criteria related to the appointment, dismissal, and compensation of directors such as the Representative Director and President, as well as ensuring transparency in the decision-making process. The committee is chaired by an outside director, and the majority of its members are outside directors.
The Company ensures that the Groupâs operations are conducted appropriately and ethically by having established the Benesse Group Code of Conduct, which presents conduct guidelines for the individual officers and employees of the Group, based on the Benesse Group Principles. The guidelines provide a reference point for Benesse Group officers and employees for understanding the values they should uphold and for making judgements. In addition, the Company has formulated Benesse Group Risk Management and Compliance Rules as regulations shared across the entire Benesse Group. In order to carry out the actions indicated in the Benesse Group Principles, each Group company complies with the laws and regulations and has more detailed codes of conduct and rules specific to the type and characteristics of its business, scale of business, and work environment, etc. These various rules ensure that business is conducted in an appropriate manner and that compliance is carried out thoroughly. The Company has also established and operates the Benesse Group Speak-Up Line and the Audit & Supervisory Board Member Hotline as a whistleblowing system for reporting breaches of the law, misconduct, or violations of the Company's Articles of Incorporation or internal rules. By thus complying with social norms, management ethics, laws and regulations, and the like, the Group aims to be a company that continues to provide value to society.
To formulate the basic policy of the Groupâs internal control system based on this code of conduct and the general features required for establishing a system pursuant to the Ordinance for Enforcement of the Companies Act, the Companyâs Board of Directors passed a resolution based on Article 362, Paragraph 4, Item 6, of the Companies Act.
- ă»Under the holding company structure, among the Group's strategic business domains, the President of Benesse Corporation supervises the education and lifestyle domains, while the President of Benesse Style Care Co., Ltd. supervises the nursing care and childcare domains. The Company collects and shares information related to the business execution of the entire Group, based on operating company management and administration rules. This serves as a monitoring function.
- ă»The Company designates a responsible person in each administrative division to assist directors in the lawful and appropriate execution and oversight of their duties while also entrusting them with the task of advancing the Group's business management, identifying and resolving management concerns, and other related responsibilities.
- ă»The Company has established a Management Council for Group management leaders to share important issues and information and deliberate on important matters for the Group . The Council is chaired by the CEO and attended by the Presidents of Benesse Corporation and Benesse Style Care Co., Ltd., the heads of their in-house business companies, people in charge of the Companyâs administrative divisions, and others designated by the CEO.
- ă»Subsidiaries must consult with the Company before making any administrative decisions on important matters that could impact the Groupâs management. In the case of subsidiaries which are supervised by the Presidents of Benesse Corporation and Benesse Style Care Co., Ltd., those consultations are carried out through the presidents of the companies which oversee the relevant business domains. The presidents of the subsidiaries which supervise the relevant business domains discuss these matters with the people in charge of the administrative divisions from the perspective of the Groupâs growth and legal compliance, followed by a process of approval of the CEO and a resolution by the Companyâs Board of Directors.
- ă»In risk management, the Company has established a Risk and Compliance Committee, and by monitoring the progress of material risk countermeasures included in the business plans of the Company and its subsidiaries, the Committee visualizes the status of risks and determines the Group's major risks and risk countermeasures every fiscal year. The Committee regularly reports the results to the Board of Directors which are then disseminated within the Company and its subsidiaries, and promotes improvements (including corrective measures, implementation of preventive measures, education, and training, etc.).
- ă»Based on the management guidelines for the entire Group, the Group has established a simple and clear response system for communicating information quickly to top management when a crisis occurs.
- ă»The Companyâs information management system requires that important information be retained for at least 10 years, as stipulated in the document management rules.