Corporate Governance Structure

Yaskawa Electric has adopted a corporate structure with an Audit and Supervisory Committee in order to further strengthen the oversight function of the Board of Directors over management and corporate governance, as well as to enhance the soundness and efficiency of management. The Company believes that the supervisory function of the Board of Directors will be further enhanced by utilizing the legal functions of Audit and Supervisory Committee Members, such as the ability of Audit and Supervisory Committee Members as directors to exercise voting rights at the Board of Directors on important matters of the Company, such as the appointment and dismissal of Representative Directors, and the ability to examine the results of the execution of business by Executive Directors and to express opinions at the General Meeting of Shareholders on the appointment, dismissal and remuneration of Executive Directors. In addition, the Company has introduced an executive officer system to separate management decision-making and business execution functions, enhance each function, and speed up business execution.

• 

  Corporate Governance Structure

Yaskawa Electric’s Board of Directors consists of 13 members, including 8 internal and 5 external directors.

In addition to the regular meetings of the Board of Directors, the Board of Directors convenes extraordinary meetings as necessary to decide on important matters related to management and matters stipulated by laws and regulations, and to supervise the status of business execution on an ongoing basis.

Yaskawa Electric has appointed Yuichiro Kato, Yoshiki Akita, Junko Sasaki, Hideo Tsukamoto and Toshikazu Koike as Outside Directors to receive advice and recommendations from an independent standpoint regarding the overall management of the Company based on their diverse perspectives, experience and advanced expertise. Outside directors fulfill the appropriate supervisory function by providing advice and recommendations based on their respective knowledge in the Board of Directors, after fully understanding the current situation in Yaskawa Electric based on information submitted or reported by the Internal Control Department, the Internal Audit Department, the Head Office business divisions, and the Accounting Auditors.

The Audit and Supervisory Committee consists of 6 directors (of which four are outside directors) who are Audit and Supervisory Committee Members, and audits the status of execution of duties by Directors and others. In conducting audits, the Audit and Supervisory Committee fully understands the current status of Yaskawa Electric based on information reported by the Internal Control Division, the Internal Audit Division, and the head office business divisions, while full-time Audit and Supervisory Committee Members conduct audits based on actual inspections. In addition, the Audit and Supervisory Committee carries out duties in cooperation with the Accounting Auditor, and monitors and verifies the duties of the Accounting Auditor.

Yaskawa Electric has appointed EY ShinNihon LLC as an accounting auditor, and has provided accurate management information under an auditing contract and created an environment in which audits are conducted from an independent standpoint. We consult with and receive advice from our accounting auditors when they need to make a decision.　

The Executive Committee is composed of executive directors and executive officers and discusses important decisions related to business execution, including reports on the progress of management plans and deliberations on policies and measures for all businesses. As a general rule, meetings are held once a month, and extraordinary meetings are held as necessary to establish a flexible and prompt business execution system.

The Nomination Advisory Committee consisting of a majority of independent outside directors is established under the Board of Directors to ensure transparency and fairness in the process of nomination of candidates for Directors, selection of Representative Directors and Executive Officers, etc., and provide opportunities for Outside Directors to gain sufficient information to form opinions on the nomination of Directors, etc.
When submitting proposals regarding the appointment of officers to the Board of Directors, the content of such proposals shall be fully reflected in the report of the Committee.

The Compensation Advisory Committee consisting of a majority of independent outside directors is established under the Board of Directors to ensure the appropriateness and transparency of the remuneration of directors (excluding directors who are Audit and Supervisory Committee Members) and executive officers through fair deliberations, and to ensure a forum for outside directors to obtain sufficient information and discuss the remuneration in order to form opinions.
The Committee deliberates on the compensation for directors calculated in accordance with the directors’ compensation rules and other necessary matters concerning directors’ compensation from the viewpoint of appropriateness.

※The ages are as of May 26, 2021, at the 105th Annual General Shareholders Meeting.

Individuals who do NOT correspond to any of the following items can be appointed as independent outside directors, with regards to the independence standards set by the Financial Instruments Exchange.

・Nominees have worked for an organization that holds 10% or more of the company’s stock, either now or within the past three business years.
・Nominees have worked for the company’s main bank or the major group borrowers as described in the most recent business report, now or within the last three business years.
・Nominees have worked for the company’s Lead Managing Underwriter at the time of writing or within the last three business years.
・Nominees have worked for an organization with a our company account for more than 1% of the company’s or its counterparty’s consolidated sales at the present or within the past three business years.
・Nominees have worked for the accounting firm of the company either now or within the past three business years.
・The eligible individual has received more than 10 million yen in annual compensation, etc., from the company for consulting or advisory contracts such as laws, accounting, taxation, etc., at the present or within the past three business years.
・During the past three business years or now, nominees have worked for organizations including individuals that received more than 10 million yen in annual donations from the company.

Yaskawa has been evaluating the effectiveness of the Board of Directors every year since FY2016 to ensure a sustainable increase in corporate value through improved effectiveness. All directors, including Audit and Supervisory Committee members, understand the purpose of the evaluation, and answer the “Questionnaire on Board of Directors Evaluation” (anonymous). We examine and implement measures to address issues identified in the results with the aim of further improving effectiveness.
According to the FY 2020 survey, more than 80% of all respondents answered that the evaluation items had been completed, indicating that the effectiveness of the measures has been secured in general. On the other hand, the response “urgent improvement is necessary” was also extracted, which was not extracted in the past two years. We believe this is a further enhancement of the level required of the Board of Directors. We are working to further improve the effectiveness of these measures by taking them into account.

As a Business-to-Business manufacturing company, Yaskawa’s management requires in-depth knowledge of market characteristics and technological trends, it has selected a system with an Audit and Supervisory Committee as an institutional design for its organization on the assumption that the president has authority over management policies, nominations, and compensation.
At the same time, we have developed a governance system to enhance the effectiveness of the Board of Directors by actively incorporating external knowledge, and to strengthen both defensive and offensive governance, in order to continuously improve corporate value. Yaskawa will continue to pursue its best, enhance management transparency, and further enhance corporate governance.