Corporate Governance

Recognizing that corporate governance is an important management issue, the Company has appointed outside directors to ensure management transparency since its establishment. Previously, the Company had a system of Board of Statutory Auditors. However, with the approval of an amendment to the Articles of Incorporation at the 78th Ordinary General Meeting of Shareholders held on June 24, 2022, the Company became a company with an Audit & Supervisory Committee system. The Board of Directors, which generally meets once a month, consists of 15 directors (including 7 full-time directors and 8 part-time outside directors, including 6 independent outside directors) and makes decisions on basic management policies, matters prescribed by laws and regulations and other important management matters, and supervises the conduct of business. The Audit & Supervisory Committee consists of three independent outside directors and members of the Audit & Supervisory Committee, who attend the meetings of the Board of Directors and other important meetings to monitor the legality and appropriateness of the directors' performance of their duties, as well as the transparency and soundness of management.

The Japan Airport Terminal Group (hereinafter, the “Group”) is a company engaged in a business of significant public importance. Under its philosophy of “Harmony between the Business and the Society,” the Group has established a company-wide internal control system including Group companies in order to raise the effectiveness and efficiency of operations, ensure the reliability of reporting, and promote compliance related to business activities. Further, the Group works to strengthen its internal control system through ongoing improvements.

(1) Systems to ensure that the execution of duties by directors, executive officers, and employees complies with laws, regulations, and the Articles of Incorporation

(i) To establish a compliance system for the Group, Japan Airport Terminal Co., Ltd. (hereinafter, the “Company”) shall establish a code of conduct for directors and employees in accordance with the Japan Airport Terminal Group Basic Compliance Guidelines (hereinafter, “Basic Compliance Guidelines”) and develop a system to promote compliance that includes the establishment of the Compliance Promotion Committee based on the Compliance Promotion Committee Regulations.
(ii) The Company shall establish a compliance reporting hotline (reporting system) to prevent the occurrence of illegal acts, etc., and minimize the impact on the Company if such acts should occur.
(iii) The compliance control division shall take the lead in holding training sessions and explanatory meetings to ensure thorough compliance.
(iv) The Company shall establish regulations for the Board of Directors and the Executive Committee and establish a system to report the status of execution of duties by each director at these meeting bodies.
(v) The Group shall establish various internal rules based on laws and regulations and the Articles of Incorporation, such as Organizational Regulations and Rules of Employment, and establish a system to ensure the execution of duties by such internal rules and regulations.
(vi) The Company shall establish a system under which the internal audit department audits the status of execution of duties in each department.

(2) System for storage and management of information related to the execution of duties by directors

Information related to the execution of duties by directors shall be appropriately stored and managed in accordance with the internal rules for document management, etc.

(3) Rules and other systems for managing the risk of loss

(i) To develop a system for risk management, the Group shall establish basic rules related to the management of the risk of loss and other systems for the entire Group.
(ii) The Risk Management Committee, based on the Risk Management Committee Regulations, shall periodically gather information on risks from each department, identify risks that need to be addressed on a priority basis based on this information, and periodically update the risks.
(iii) For risks deemed to be of high importance, the Risk Management Committee shall compile response measures, periodically confirm their progress, and report as appropriate to the Executive Committee and the Board of Directors.
(iv) The internal audit department shall audit the validity and appropriateness of processes related to the risk management system, make proposals for improvements to each department as necessary, and report as appropriate to the Audit and Supervisory Committee.

(4) System to ensure the efficient execution of duties by directors

(i) The Board of Directors shall, in principle, meet once a month in accordance with the Board of Directors Regulations to make decisions on basic management policies, matters required by law, and other important management matters, and to supervise the execution of business operations.
(ii) The Company shall introduce an Executive Officer System to separate supervision and execution, and accelerate decision-making. It shall also establish the Executive Committee to improve the executive function. The Executive Committee shall be attended by full-time directors and executive officers, etc. and meet once a week in principle based on the Executive Committee Regulations. Based on management policies decided by the Board of Directors, the Executive Committee shall deliberate on basic policies and important matters related to business execution and supervise overall business operations.
(iii) The Company shall establish Organizational Regulations to ensure the reliable and efficient operation of the duties of the directors.
(iv) The Company shall establish the Regulations on Administrative Authority to clarify the responsibilities and authority of each position concerning the execution of the Company's business and ensure the efficient and organized management of the Company’s business.

(5) System to ensure the appropriateness of operations of the corporate group consisting of the Company and its subsidiaries

(i) The Company shall establish the Affiliated Companies Management Regulations, which stipulate basic policies regarding the management of Group companies by the Company and the appropriateness of operations between the Company and Group companies, and shall establish a system to ensure the appropriateness of the execution of business by Group companies.
(ii) The Company shall establish the Group Management Committee to advance comprehensive business as a Group and strengthen the development of Group companies, and shall receive regular reports on the status of business execution, etc.
(iii) The Company shall establish systems to ensure compliance (including the prohibition of bribery and the prevention of relationships with antisocial forces) by developing the Basic Compliance Guidelines and establishing the Compliance Promotion Committee so that the Company and Group companies act appropriately in accordance with social rules and ethical standards.
(iv) To comply with the internal control reporting system for financial reporting under the Financial Instruments and Exchange Act, the Company shall establish the Internal Control Promotion Office to promote activities to ensure the reliability of the Group’s financial reporting, and shall work to enhance internal controls related to financial reporting.
(v) The internal audit department shall audit the status of business execution of Group companies.

(6) System for reporting to the Audit and Supervisory Committee by directors (excluding directors who are Audit and Supervisory Committee members; the same follows below), and employees, and system for reporting to the Company's Audit and Supervisory Committee by directors, corporate auditors, and employees of subsidiaries or persons who receive reports from them

(i) Directors, executive officers, and employees shall report to the Audit and Supervisory Committee on internal control matters regularly and whenever important matters arise, and the Audit and Supervisory Committee may request reports from directors, executive officers, and employees (including those of subsidiaries) as necessary.
(ii) Directors, corporate auditors, executive officers, and employees of Group companies, or directors, executive officers, and employees of the Company who receive reports from them on matters concerning internal controls or important matters, etc., shall report to the Audit and Supervisory Committee.

System to ensure that a person who reports to the Audit and Supervisory Committee as described in (6) above will not receive any disadvantageous treatment because of such a report

Regarding reports to the Audit and Supervisory Committee, employees, etc. who make compliance-related reports, etc. or cooperate in investigations shall be protected, and any disadvantageous treatment on the grounds of such reporting shall be prohibited, in accordance with the Basic Compliance Guidelines and the Japan Airport Terminal Group Compliance Reporting Hotline Operating Regulations.

(8) Matters concerning directors and employees assisting the Audit and Supervisory Committee

The Company shall establish the Audit and Supervisory Committee’s Office and assign employees to assist the Audit and Supervisory Committee in its duties. In addition, Special Audit & Supervisory Officers shall be selected to assist the Audit and Supervisory Committee in its duties.

(9) Matters concerning the independence of the directors and employees mentioned in (8) above from the Company’s directors and matters concerning the effectiveness of instructions given by the Audit and Supervisory Committee to such directors and employees

If full-time employees assigned to assist the duties of the Audit and Supervisory Committee are assigned to positions independent from directors, the Company shall ensure their independence from directors and the effectiveness of the Audit and Supervisory Committee’s instructions by, for example, holding prior discussions with the Audit and Supervisory Committee regarding personnel transfers, etc.

(10) Matters concerning procedures for advance payment or reimbursement of expenses incurred in connection with the execution of duties by Audit and Supervisory Committee Members (limited to those related to the execution of duties by the Audit and Supervisory Committee) and matters concerning the policy for the treatment of expenses or liabilities incurred in connection with the execution of such duties.

If an Audit and Supervisory Committee Member requests the Company to pay expenses or settle debts incurred in the execution of the duties of Audit and Supervisory Committee Members (limited to those related to the execution of the duties of the Audit and Supervisory Committee), the Company shall pay such expenses or debts to the Audit and Supervisory Committee Members except when it is deemed that the request is not necessary for the execution of duties of Audit and Supervisory Committee Members (limited to the execution of duties of the Audit and Supervisory Committee).

(11) Other systems to ensure the effective execution of audits by the Audit and Supervisory Committee

(i) The independence of the Audit and Supervisory Committee shall be ensured, and the Audit and Supervisory Committee shall hold regular meetings with the representative director, exchange opinions on important matters related to audits, etc., and make requests that are deemed necessary.
(ii) The internal audit department shall maintain close cooperation with the Audit and Supervisory Committee and shall report internal audit plans and results to the Audit and Supervisory Committee.
(iii) Audit and Supervisory Committee Members shall be able to attend important meetings to understand important decision-making processes and the status of business execution.
(iv) The Audit and Supervisory Committee Members shall be able to view important minutes and approval documents, etc. at all times.
(v) Directors, executive officers, and employees shall cooperate with any investigation or interview requested by the Audit and Supervisory Committee or any Audit and Supervisory Committee Members thereof.