Recognizing the importance of corporate governance in business operations, Japan Airport Terminal Co., Ltd. (JAT) has been ensuring transparency in management since its foundation by appointing Outside Directors and Outside Auditors. The Board of Directors is convened on a monthly basis in principle and is attended by ten full-time Directors and five part-time Directors (including four Outside Directors) to make decisions on basic management policies, statutory issues and other important management matters and oversee execution of operations. The Auditors, consisting of two full-time Auditors and three part-time Outside Auditors, attend the meetings of the Board of Directors and other important meetings to ensure oversight of legitimacy and adequacy of operations executed by Directors as well as transparency and soundness of management. To enhance oversight, two Independent Directors were appointed in 2010. Remuneration for Directors is decided by the Board of Directors to meet the total remuneration limits set by the General Meeting of Shareholders, after inquiring of the Advisory Committee on Remunerations.
Basic Policy and Implementation of the Internal Control System
JAT has an internal control system applicable to all the group companies in place in order to increase effectiveness and efficiency of business management, ensure the reliability of corporate financial reports, and foster compliance with laws and regulations relevant to its business.
Implementation of the Internal Control System
1. Systems to ensure that the duties executed by Directors and employees conform to law and the Articles of Incorporation
a. JAT has established a system to promote compliance by issuing a Declaration of Compliance to express its resolve to improve compliance across the JAT Group, by setting up Compliance Guidelines that define the code of conduct for company officers and employees, and by forming a Compliance Promotion Committee chaired by the President, which operates in accordance with the Internal Regulation on the Compliance Promotion Committee.
b. JAT has established a system to prevent violation of law and minimize the impact of potential illegal acts on the Company by providing a Compliance Information Hotline for whistle-blowing.
c. JAT's department in charge of compliance takes the initiative in organizing seminars and explanatory meetings to ensure compliance throughout the Group.
d. JAT has established a system to ensure that the state of execution of duties by Directors is reported to the Board of Directors and Executive Meetings in accordance with the Internal Regulation on the Board of Directors and the Internal Regulation on the Executive Meeting.
e. JAT has established a system to ensure execution of duties in accordance with its bylaws set up pursuant to law and the Articles of Incorporation, such as the Internal Regulation on Organizations and the Office Regulation.
f. JAT has established a system in which the internal audit department audits the execution state of duties in each department.
2. Systems concerning the storage and management of information associated with the duties executed by Directors
JAT appropriately stores and manages information on the execution of duties by Directors in accordance with the bylaw on document management.
3. Internal regulations and other systems concerning the management of risk of loss
a. JAT has established the Internal Regulation on Risk Management to build a system for risk management.
b. JAT's internal audit department periodically identifies risks in individual departments, provides risk information based on findings, and has each department take action in response.
c. When any company-wide risks or other risks determined to be significant are identified, all departments develop preventive measures under the initiative of the Business Planning Office, and the results are reported to the Executive Meeting as appropriate.
4. Systems to ensure that Directors execute their duties efficiently
a. The Board of Directors convenes on a monthly basis in principle in accordance with the Internal Regulation on the Board of Directors to make decisions on basic management policies, statutory issues and other important management matters and oversee execution of operations.
b. The Executive Meeting is attended by full-time Directors and Executive Officers and convened on a weekly basis in principle in accordance with the Internal Regulation on the Executive Meeting to deliberate on basic policies and important issues concerning the execution of operations in accordance with the business policy adopted by the Board of Directors and to supervise overall operations.
c. JAT has established the Internal Regulation on Organizations to ensure that Directors execute their duties duly and efficiently.
d. JAT has established the Internal Regulation on Duties and Powers to clearly define the responsibility and authority assigned to each position for the execution of operations at the Company and to ensure efficient and organized operation of corporate activities.
e. The Executive Officer system was adopted on April 1, 2009, to separate the corporate supervision function from execution and expedite decision-making. Under the system, the Managing Director Meeting was reorganized into the Executive Meeting, which may be attended by Executive Officers as well.
5. Systems to ensure that the actions of the corporate group, comprising the Company, its parent companies, and subsidiaries, are appropriate
a. JAT has established a system to ensure appropriate execution of operations at the Group companies in accordance with the Internal Regulation on Management of Affiliated Companies, which defines the basic policy on subsidiary management by the parent company and appropriate transactions between the parent company and its subsidiaries.
b. Under the Internal Regulation on Management of Affiliated Companies, the Group Executive Meeting has been organized for the purpose of developing the overall business of the Group and strengthening efforts to nurture subsidiaries through the periodical reporting of execution of operations.
c. JAT's internal audit department has a system in place to audit the execution of operations at subsidiaries.
6. Systems for reporting to Auditors, including reporting by Directors and employees
The Directors and employees are required to report to Auditors when requested in accordance with the Internal Regulation on the Board of Auditors and the Audit Standards for Auditors.
7. Other systems to ensure the effectiveness of audits by Auditors
a. JAT has established a system to ensure that Auditors closely cooperate with the Audit Office to use the results of internal audits.
b. Auditors attend the meetings of the Board of Directors and other important meetings to keep track of the key decision-making processes and the execution state of operations.