Tokyogasgroup csr report

Corporate Governance

Corporate Governance


Corporate Governance Systems

Basic Policy on Corporate Governance

As an “Energy Frontier Corporate Group” focused on natural gas, Tokyo Gas shall actively contribute to the creation of pleasant lifestyles and an environmentally friendly society and work to ensure continued development while consistently earning the trust of customers, shareholders, and society. Under its management philosophy, Tokyo Gas seeks to fulfill and bolster its corporate governance in order to increase its corporate value by ensuring legality, soundness and transparency of management. Simultaneously, it engages in appropriate, prompt decision making, efficient business operations, enhancement of the audit and supervisory functions, and clarity of responsibility of management and operations.

Outline of Implementation System of Corporate Governance

To increase the speed and effectiveness of management decision-making, we appoint an appropriate number of directors and invite outside directors to serve on the Board of Directors for greater transparency as well as to reinforce the supervision of business operations. Our Board of Directors now has nine members, including four outside directors. Furthermore, we have established the Advisory Committee, comprised of two outside directors, one outside Audit & Supervisory Board member, the chairman and the president to select candidates for officers in a fair and proper manner in response to an inquiry by the Board of Directors. It also deliberates on the salaries of officers, based on the Basic Policy on Officer Remuneration, and submits decisions to the Board of Directors. Our audits are conducted based on stringent standards by five Audit & Supervisory Board members, with three of them being outside members.
The Corporate Executive Meeting, which is held once a week in principle, deliberates on matters requiring approval from the Board of Directors as well as important management-related issues to achieve accurate, prompt decision making and efficient business execution. In business execution based on the resolution of the Board of Directors, by introduction of an executive officer system, the Board of Directors delegates substantial authority to executive officers in their designated criteria of responsibility by resolution. On the other hand, the directors supervise those executive officers in an appropriate manner and in accordance with a report they receive on the status of business execution by executive officers, if needed, which is submitted to the Board of Directors. (The term of office of directors and executive officers is set at one year to clarify management and executive responsibilities.) We established the Management Ethics Committee, chaired by the president, and other in-house committees to address key management concerns such as compliance, security, customer satisfaction, sustainability, and risk management and to promote transparent management and create a flexible, open corporate culture. These committees facilitate the sharing of information within the Group as well as deliberations and adjustments regarding the Group’s overall direction.
Tokyo Gas has adopted and established a highly objective and transparent governance systems to invite outside directors and Audit & Supervisory Board members to create multiple layers in its audit and supervisory functions.
 

System for Promoting Corporate Governance (as of June 27, 2019)

System for Promoting Corporate Governance (as of June 27, 2019)

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System for Promoting Corporate Governance (as of June 27, 2019)
 

Overview of Corporate Governance System (as of June 27, 2019)

Number of directors 9 Participation of outside directors and outside Audit & Supervisory Board members in selecting director candidates Yes
Average age of directors 61 Number of meetings of Board of Directors*1 12
Number of outside directors 4 Attendance rate of outside directors at meetings of Board of Directors*1 100%
Number of Audit & Supervisory Board members 5 Term of office of directors One year
Number of outside Audit & Supervisory Board members 3 Performance-linked remuneration Yes
Number of independent officers 7 Share purchase system to reflect the perspective of shareholders in management Yes
Participation of outside directors / outside Audit & Supervisory Board members in determination of remuneration Yes

*1 Total for the period from April 2018 to March 2019

Compliance with Japan’s Corporate Governance Code

Tokyo Gas has formulated the “Basic Policy on Corporate Governance” in compliance with Japan’s Corporate Governance Code for listed companies. To achieve sustainable growth and increase its corporate value over the medium- to long-term, we will collaborate with our stakeholders, ensure appropriate information disclosure and transparency, and fulfill the commitment of the Board of Directors, and at the same time, we will pay due consideration to communicating and gaining the understanding of stakeholders including shareholders. Our response to each of the principles of Japan’s Corporate Governance Code as of June 2019 is summarized below.
 
Principles Location of Disclosure
Website Basic Policy on Corporate Governance Corporate Governance Report
Principle 1-4 Cross-Shareholdings   Article 20
Principle 1-7 Related Party Transactions   Article 21
Principle 2-6 Roles as an owner of corporate pension assets   Article 29
Principle 3-1
Full Disclosure

(1) Management Philosophy, strategies and medium- and long-term management plans

   

(2) Basic views and guidelines on corporate governance

  Article 2

(3) Policy and procedures for determining officer remuneration

Article 15

(4) Policy and procedures for election (nomination) of officers

  Article 6
Article 11

(5) Reasons for election and nomination of individual officers

   
Supplementary Principle 4-1-1 Scope of Matters Delegated to Management by the Board of Directors   Article 4
Principle 4-9 Independence Standards
and Qualification for
Independent Directors
Article 6
Supplementary Principle 4-11-1 View on the Board of Directors as a Whole   Article 4
Article 5
Article 6
Supplementary Principle 4-11-2 Concurrent Posts Held by Directors and Audit & Supervisory Board Members    
Supplementary Principle 4-11-3 Analysis and Evaluation of Effectiveness of Board of Directors as a Whole   Article 8
Supplementary Principle 4-14-2 Policy for Training of Directors and Audit & Supervisory Board Members   Article 16
Principle 5-1 Policy for Constructive Dialogue with Shareholders   Article 19
 
DFF Inc., Corporate Social Responsibility Sect, General Administration Dept., Corporate Planning Dept., Resources & Global Business Division, Energy Solution Div, Power Buisiness Dept., Pipeline Network Division, IT Division, Residential Sales Div., Fundamental Technology Dept., Energy Solution Div, Environmental Affairs Dept., Purchasing Dept. , Health Insurance & Employees' Welfare Sect., Personnel Dept., Internal Audit Dept., Audit & Supervisory Board Member's Office, Compliance Dept., Regional Development Div., Finance Dept, TGES, TOKYO GAS COMMUNICATIONS, INC.