• Home
  • Product Information
  • Download
  • Technical Specifications
  • Corporate Information
  • Investor Relations
  • Contact Us

Corporate Governance

Corporate Governance

1.Basic Policy

At Star Micronics, our basic approach to corporate governance is based on fulfilling our social responsibilities as a company. To this end, we strive for management that is both appropriate and efficient at sustainably raising corporate value, while distributing an appropriate amount of the resulting profits to our shareholders and other stakeholders.

Go to top of the page

2. Corporate Governance System

(1)Summary of Corporate Governance System and Reasons for Its Adoption

Based on a resolution at the Company’s 91st General Meeting held on May 26, 2016, Star Micronics transitioned to a company with an audit and supervisory committee in order to further strengthen the supervisory function of its Board of Directors and to enhance its corporate governance capabilities. The Company has decided to set the number of internal directors including the president at three and to appoint four outside directors including directors who serve as Audit and Supervisory Committee members. In this manner, outside directors make up a majority of the Board of Directors. Based on each of the aforementioned, the Company has taken steps to further clarify the supervisory and executive roles of management. This initiative is aimed at increasing the speed at which business strategies are implemented.
Furthermore, an executive officer system was introduced to Star Micronics to speed up and raise the efficiency of business execution even further, and ensure that management as an organization is flexible and capable of prompt, rational decisions for executing business. The Board of Directors is comprised of seven directors, four of whom are appointed from outside the Company. This ensures the independence, efficacy, and efficiency of the decision-making process while fortifying the supervisory function with respect to the execution of directors’ duties. The Audit and Supervisory Committee is comprised of three outside directors. In addition to auditing the activities of directors in the general conduct of their duties, the Audit and Supervisory Committee is responsible for auditing the Company’s accounting statements and related documentation and preparing audit reports in accordance with audit policies and plans determined by the Audit and Supervisory Committee. Moreover, the Committee undertakes audits in conjunction with accounting auditors as well as internal audit and related departments.

(2)Overview of Limitation of Liability Agreements

The Company and its outside director have entered into agreements on the limitation of liability for damages pursuant to Article 423-1 of the Companies Act of Japan, as stipulated by Article 29 of the Company’s Articles of Incorporation, in accordance with Article 427-1 of said Act. Based on these agreements, the maximum amount of liability for damages shall be the minimum amount stipulated in Article 425-1 of the Companies Act of Japan.

(3)Internal Control System

Star Micronics strives to maintain an internal control system that will enable proper and efficient management to drive a continuous increase in corporate value.
To strengthen internal control, the Star Micronics Global Code of Conduct was drawn up for employees to follow, and we have been working to establish rules and organizational structures to ensure compliance at every level of our activities. In addition, a department dedicated to promoting corporate social responsibility (CSR) spearheads our compliance activities. This department plays a central role in providing reminders and education on compliance to the Group’s directors, executives and employees, and is charged with holding periodic committee meetings and monitoring the status in regard to the Group’s adherence with all relevant laws and regulations.
Star Micronics also has an appropriate internal control and whistleblower system for ensuring the reliability of its financial reporting, as stipulated in the Financial Instruments and Exchange Law of Japan.

(4)Status of the Risk Management System

Star Micronics approaches the management of material risks such as legal issues, natural disasters, environmental considerations and export management in an organized and systematic manner. Departments and individuals are assigned as needed to manage a specific risk, and take responsibility for establishing rules and manuals, etc., for managing the risks. They also implement programs to alert, educate and prepare the Group’s directors, executives and employees against the risks. There is also a committee which meets periodically to monitor and manage risks for the Group.

(5)Status of Systems Designed to Ensure That Subsidiaries Conduct Their Operations in an Appropriate Manner

The director or executive officer that heads the division in charge of each subsidiary obtains the Company’s approval and/or submits to the Company all essential reports of in connection with important decisions made and facts pertaining to the subsidiary in accordance with the Company’s internal rules and regulations.

Go to top of the page

3. Status of Internal Audits, Audit & Supervisory Committee Member Audits and Accounting Audits

(1) Internal Audits

The Company has an Audit Office (5 staff members) that reports directly to the president and CEO. The Audit Office strives to ensure proper management of business operations by conducting audits in accordance with internal audit rules and audit plans.

(2) Audit & Supervisory Committee Member Audits

The Company’s Audit & Supervisory Committee comprises three outside Audit & Supervisory Committee Members. Each Audit & Supervisory Committee Member audits the performance of directors’ duties principally by attending Board of Directors’ meetings, and surveying the operations and financial position of each business department. These activities are based on the audit policies, audit plans, audit operations, division of roles and responsibilities and other matters determined by the Audit & Supervisory Committee.

(3)Accounting Audit

The Company has concluded an audit contract with Deloitte Touche Tohmatsu LLC. The Audit & Supervisory Committee Members maintain close cooperation with this accounting auditor, such as by requesting reports as necessary. The certified public accountants who carried out the accounting audit of the Company were Mr.Hajime Seishi and Mr.Hiroyasu Sakai. They were assisted by 8 certified public accountants, 3 passed the certified public accountant examination etc and 8 other staff.

(4)Cooperation between Internal Audits, Audit & Supervisory Committee Member Audits and Accounting Audits, and Relationship between These Audits and Internal Control Divisions

The Audit & Supervisory Committee Members receive reports on the results of audits conducted by the Audit Office. Employees belonging to the Audit Office assist with the Audit & Supervisory Committee Members’ duties when such assistance is requested by the Audit & Supervisory Committee Members. In addition, the Audit & Supervisory Committee Members maintain close cooperation with the accounting auditor, such as by requesting reports as necessary.
Furthermore, the full-time Audit & Supervisory Committee Members are taking steps to strengthen internal control functions, such as by attending compliance and risk management committee meetings and expressing their opinions as necessary.

Go to top of the page

4. The Board of Directors

(1) Personal, capital, business, or other special interest relationships

There are four outside appointee to the Board of Directors of Star Micronics, and three members of the Audit & Supervisory Committee at Star Micronics are outside appointees. Outside Audit & Supervisory Committee member Mr. Hidenobu Horiike has previously served at The Shizuoka Bank, Ltd. with which Star Micronics has a business relationship. This business relationship mainly consists of monetary loans. However, given that Shizuoka Bank is only one of a number of financial institutions with which the Company has business relationships, the Company's business dealings with Shizuoka Bank are not exceptional in any respect. Moreover, considering Shizuoka Bank's shareholding ratio in the Company, Star Micronics has determined that Shizuoka Bank has no influence over decision making regarding the Company's business execution or other matters.
There are no personal, capital, business, or other special interest relationships between any other outside members of the Board of Directors.
There is no risk of a conflict of interest between any of the outside members of the Board of Directors. For this reason, the outside appointees have been designated as independent officers based on the rules of the Tokyo Stock Exchange, and the Company has provided the Tokyo Stock Exchange with notification to this effect.

(2) Approach to functionality and appointments as regards fulfilling corporate governance
Mr. Seigo Iwasaki is a representative director for Shizuoka Gas Company, Ltd. and has a wealth of experience and extensive insight based on his involvement in corporate management. For this reason, management believes that Mr. Iwasaki is qualified to audit matters such as the appropriateness of the decision making and the performance of duties by the Company's directors. Based on the foregoing, Star Micronics has appointed Mr. Iwasaki as an outside Board of Directors member.
Mr. Hidenobu Horiike, after having experienced a broad range of business at The Shizuoka Bank, Ltd., is involved in the management of Shizugin Business Create Co., Ltd. as Director and Managing Executive Officer. The Company would like to elect him as an Outside Audit & Supervisory Board Member in the hope that he will reflect his experience and knowledge in auditing the Company. For this reason, management believes that Mr. Horiike is qualified to conduct the Company's audits. Based on the foregoing, Star Micronics has appointed Mr. Horiike as an outside Audit & Supervisory member.
Mr. Hide Doko is a lawyer and has an appreciable degree of insight into corporate legal affairs. For this reason, management believes that Mr. Doko is qualified to conduct the Company's audits. Based on the foregoing, Star Micronics has appointed Mr. Doko as an outside Audit & Supervisory Committee member.
Mr. Motoki Sugimoto has advanced specialist expertise and abundant experience as a certified accountant and a tax attorney. For this reason, management believes that Mr. Sugimoto is qualified to conduct the Company's audits. Based on the foregoing, Star Micronics has appointed Mr. Sugimoto as an outside Audit & Supervisory Committee member.
Star Micronics has not established any particular standards or policies regarding the independence of officers from the Company for the purpose of selecting outside appointees. However, when selecting outside appointees, the Company refers to the Tokyo Stock Exchange's standards for independent officers, as well as ensuring that they satisfy the requirements for outside officers stipulated by the Companies Act of Japan.

(3) Cooperation between supervision and auditing of management and internal audits, corporate auditor audits and accounting audits, and the relationship between these audits and internal control divisions

The outside Board of Directors members grasp the status of internal control through the internal Board of Directors members and others, and are able to provide advice and issue instructions when necessary from an objective and even-handed viewpoint. The outside Audit & Supervisory Committee members audit the performance of directors by attending Board of Directors meetings and other meetings, based on the audit policies and division of duties determined by the Audit & Supervisory Committee. The internal audit division, the internal control division, and the accounting auditor cooperate to exchange information and opinions and hold discussions.

Go to top of the page

5. Number of Directors

The Articles of Incorporation stipulate that the Company shall have no more than 10 directors.

Go to top of the page

6. Requirements for Resolution on Selection of Directors

The Articles of Incorporation stipulate that resolutions on the selection of directors shall be adopted by a majority of votes of the shareholders present at a meeting, where such shareholders hold at least one-third of the aggregate number of voting rights held by the shareholders who are entitled to exercise voting rights. The Articles of Incorporation also stipulate that resolutions on the selection of directors shall not be adopted by cumulative voting.

Go to top of the page

7. Resolutions of General Meetings of Shareholders that can be Resolved by the Board of Directors

The Articles of Association stipulate that the Company may decide a resolution about Article 459-1 of the Companies Act of Japan in accordance with resolution of the Board of Directors unless otherwise provided for in the laws and regulations. This is to enable agile execution of capital structure policies and dividends polices.

Go to top of the page

8. Requirements for Special Resolutions by the General Meeting of Shareholders

In regard to requirements for special resolutions by the General Meeting of Shareholders in accordance with Article 309-2 of the Companies Act of Japan, the Articles of Incorporation stipulate that resolutions at the General Meeting of Shareholders shall be adopted by at least two-thirds of the voting rights of the shareholders present at the meeting, where such shareholders have at least one-third of the aggregate number of voting rights held by the shareholders who are entitled to exercise voting rights. This is to reduce the quorum for special resolutions by the General Meeting of Shareholders for the purpose of facilitating the efficient operation of the General Meeting of Shareholders.

The Company’s corporate governance system is outlined as follows:

corporate governance system

Go to top of the page

PAGE TOP