The top priorities for corporate governance of the Mitsubishi Chemical (MCC) Group are to ensure fast and efficient decision making and business execution, clarify management responsibilities, ensure compliance and strengthen risk management.

The MCC Group’s basic corporate governance structure is illustrated below. The company has adopted an executive officer system to separate management and executive functions. Furthermore, MCC has defined the extent of the authority of such decision-making bodies as the Board of Directors and various management positions in its internal rules. Through these and other measures, MCC ensures proper, efficient managerial decision making and business execution.

Corporate Governance Structure of the Mitsubishi Chemical Group
(as of June 26, 2018)

Corporate Governance Structure of the Mitsubishi Chemical Group

Board of Directors

The Board of Directors meets once a month in principle. In accordance with the regulations of the Board of Directors and other relevant rules, the board makes decisions on important managerial matters and basic matters concerning Group management and provides oversight of the execution of duties by directors. The six directors (four of whom concurrently serve as executive officers) form a management structure capable of quickly adapting to environmental changes. To further clarify the managerial responsibilities and role of each director, the term of office for a director is one year. Human resources judged to possess the necessary skills and qualities to realize the Group’s corporate philosophy and fulfill its social responsibilities are selected as candidates for director by the Board of Directors. Candidates are then proposed at the Shareholders’ Meeting, where they may be elected by a resolution of shareholders.

Executive Management Committee

The Executive Management Committee is an advisory body that assists the President in making decisions, deliberating important matters concerning business execution, such as the investment and financing activities of MCC and the MCC Group. Particularly important managerial matters deliberated by the Executive Management Committee are acted on only upon the resolution of the Board of Directors. The Executive Management Committee meets twice a month in principle. The committee comprises the President, the chief operating officers of the business domains, the supervising officers of the corporate function domains, the presidents of the regional headquarters and the general manager of the Corporate Planning Department. The directors of the board and corporate auditors may also attend its meetings as needed.

Corporate Auditors

MCC has corporate auditors to audit its activities. The corporate auditors attend Board of Directors, various committee and other important meetings, verify the contents of reports submitted by directors of the board and other relevant parties, investigate the status of the company’s business and property, and audit the execution of duties by directors of the board. MCC does not have a Board of Corporate Auditors, but voluntarily maintains a Corporate Auditors Liaison Committee to facilitate coordination and cooperation among the corporate auditors. The Corporate Auditors Liaison Committee meets once a month in principle. At meetings, the corporate auditors discuss audit plans and other important audit-related matters. As of the end of June 2018, MCC has five corporate auditors. Corporate auditors, the accounting auditor and the Internal Audit Department work in close coordination, exchanging opinions on their respective audit processes and results.

Committees

The company maintains a number of committees, including the Compliance Promotion Committee, Risk Management Committee, Information Security Committee, Environmental and Safety Promotion Committee, and Human Rights and Diversity Promotion Committee. These committees refer or report important matters to the Board of Directors or the Executive Management Committee.