Governance

Corporate Governance

Basic Approach to Corporate Governance

Based on the Kansai Paint Group’s Mission Statement within our Corporate Philosophy, “we leverage superior technology to contribute to our Customers and Society, in a sustainable manner, with innovative Products and Services, through a competent workforce, built on a culture of Customer Focus, Integrity and Respect to our Stakeholders,” we are working to enhance our mid- to long-term corporate value.
To this end, with the recognition that enhancing corporate governance is an important management task, we are striving to establish a corporate governance organization as described below, in order to establish a highly sound, transparent, and efficient management system, including fulfilling the management’s responsibility and accountability toward the shareholders and other stakeholders.

For details: Policies and initiatives concerning the corporate governance code (Japanese only)

https://www.kansai.co.jp/ir/governance/policy/pdf/gover20220630.pdf

Changes in Our Corporate Governance System

In order to contribute to our sustainable growth and the enhancement of our mid- to long-term corporate value, and also to ensure the mutual prosperity of various stakeholders, including shareholders, employees, customers, business partners, and the local community, we will continue working to strengthen corporate governance while adapting to revisions to various laws, regulations, and listing rules, as well as changes in the economic environment.

  2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Organization 2011
Introduced an executive officer system		 2016
Held an Evaluation Committee meeting		 2017
Held a Nomination Committee meeting		 2021
Reorganized into a 6-unit structure
Composition
of the Board
of Directors		 2011
Reduced the number of Board of Directors members from 20 to 11		 2013
Appointed one outside director		 2015
Appointed two outside directors (including one female outside director)		 2017
Shortened the term of the Board of Directors from two years to one
year		 2019
Appointed three outside directors (including one female outside director and one non-Japanese outside director) Outside directors account for 1/3 of all the Board of Directors
Remuneration
system		   2015
Introduced a performance-linked remuneration system using the shareholding
association		 2017
Introduced a performance-linked, stock-based remuneration system (trust-type) in place of the system introduced in 2015		 2022
Revised the executive remuneration system
Others   2015
Formulated and disclosed our policy and initiatives concerning the Corporate Governance Code		 2018
100th anniversary Renewed our Corporate Philosophy		 2021
Organized Sustainability Promotion Committee and Compliance Promotion Committee

Corporate Governance Chart (As of July 2022)

Management System and Business Execution System

Board of Directors

  • ・ The Board of Directors monitors the business performance, status of execution, and progress of the medium-term management plan on a quarterly basis, and also deliberates on management policies and important matters stipulated in laws and regulations, the articles of association, and the Articles of incorporation and Board of Directors regulations
  • ・ The composition of the Board of Directors is well-balanced in terms of diversity, including gender and international perspectives, and its members possess the knowledge and abilities necessary to effectively fulfill their responsibilities. The term of each director is one year, and they are elected at the annual General Meeting of Shareholders.

Audit & Supervisory Board

  • ・ Audit & Supervisory Board members attend Board of Directors meetings and other important meetings, and state their opinions as necessary. They also conduct audits of business execution by directors, by inspecting important documents and holding interviews regarding the status of the execution of duties, among other matters, as necessary.
  • ・ Audit & Supervisory Board members meet regularly with auditors to exchange opinions and information, and request reports from the auditors as necessary.
  • The Audit & Supervisory Board confirms that the auditing methods of the auditors and the investigation results are appropriate.

Exco Meeting

  • ・ In order to further ensure the separation of supervisory and executive functions, issues related to management strategies and decisions on important executive matters and policies are made by the Board of Directors after deliberation by the Exco Meeting, which is led by the Representative Director and President, and other executive officers.

Accounting Auditor

  • ・ We have entered into an audit contract with KPMG AZSA LLC for audits related to the Companies Act and the Financial Instruments and Exchange Act, including internal control audits based on the Financial Instruments and Exchange Act.

Discretionary Advisory Committees

Evaluation Committee

  • The committee works to improve the effectiveness of the Board of Directors by conducting self-evaluations of the operation of the Board of Directors, performance evaluations of directors and executive officers, and deliberations on issues such as the appropriate remuneration for directors and executive officers.

Nomination Committee

  • In submitting candidates for the position of director to the annual General Meeting of Shareholders, the Board of Directors decides whether to appoint candidates following deliberations by the committee

Management of Group Companies

  • ・ We have appointed a person to be in charge of each subsidiary, and dispatched executives and employees to serve as directors of subsidiaries if necessary. We have a system in place to ensure the efficiency of the execution of duties by the directors of subsidiaries by confirming that subsidiaries are fully informed of our policies and other matters in cooperation with the person in charge
  • ・ For issues that may have a significant impact on the management of subsidiaries, the person in charge reports to the Board of Directors. If necessary, the Board of Directors decides on policies through resolutions.
  • ・ We strive to share and foster the Corporate Philosophy, and encourage executives and employees at subsidiaries to act with high ethical standards and strive to establish a trustworthy management system.
  • ・ In order to ensure the legality, appropriateness, and efficiency of the operations of subsidiaries and to support the establishment of internal controls, the Internal Auditing Department conducts regular internal audits of subsidiaries in cooperation with the relevant departments, and reports the results to the Representative Director of the Board, President, Audit & Supervisory Board members, and the Board of Directors of the company as needed.