Governance

Corporate Governance System

The DOWA group adopted the executive officer system to soundly and effectively operate organizations, fasten decision-making and for effective management. The group also adopted the holding company system to separate business units from the holding company as subsidiaries.
We also strive to ensure sound business management, focusing on enhancement of corporate governance through internal controls. This is done to improve quality and efficiency of management to implement open, highly transparent management, based on the DOWA Group's Values and Standards of Conduct.

As of March 2016

Types of organization	Company with auditors
Number of directors	7persons (No. of directors designated in the article of incorporation: 13 persons)
No. of external directors included	2persons (1 of them is designated as an independent officer)
Term of office of directors designated in the article of incorporation	1year
Chairman of Board of Directors	President
No. of auditors	4persons (No. of auditors designated in the article of incorporation: 5 persons)
No. of external auditors included	3persons

As a general rule, the Management Executive Committee, which includes the Board of Directors and executive officers, is held once a month to promote information sharing. Each Auditor conducts audits on the execution of duties by the Directors and in principle reports at the Board of Auditors meeting, which is held once a month, to ensure the effectiveness and efficiency of the audit.

For disclosure etc. based on each principle of corporate governance code, please refer to our Report Web pertaining to Corporate Governance. (Japanese only)

http://www.dowa.co.jp/en/about_dowa/governance.html

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Internal Control Activities

To strengthen corporate governance, we encourage each company in the group to share the basic policy and the system of internal control with DOWA Holdings (Holdings Company) and also entrust each company to conduct their own activities which shall exploit each company's uniqueness. This ensures effective and efficient internal control based on the holding company system.

Internal Audit

The internal audit based on the internal audit rules prescribed by the DOWA group involves all corporate activities, such as accounting audit, legal audit, safety and environmental audit etc. Our CSR department and each of the related departments and group companies cooperate with each other and conduct the internal audit, and report its results to the directors, auditors and relevant departments.

In FY2015, we conducted briefings at 7 domestic bases, internal audits in 14 companies and overseas internal audits in 15 companies in North America, South East Asia and China, as a part of strengthening the internal control.

Please refer to our annual report on the basic policy regarding the internal control system and its operation status.

http://www.dowa.co.jp/index_e.html

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Risk Management

The DOWA group addresses risk management to properly control risks that may hinder the realization of our business philosophy and achievement of our business plans, and to fulfill our social responsibilities, and contribute to the improvement of our sustainable corporate value. Among the risks that beleaguer the group, the board of directors is responsible for the "Business risks" and the CSR department is responsible for the "CSR risks" in cooperation with other departments.

Business Continuity Plan (BCP) Initiatives

The DOWA group has prepared a business continuity plan (BCP) by location and business entity to respond to natural disasters, such as large-scale earthquakes, typhoons, floods caused by torrential rains etc., and is making efforts to avoid risks so that business activities can continue when there is an emergency. BCP was reviewed on a regular basis and in FY2015, 24 business subsidiaries reviewed the supposed targets and countermeasures of BCP.
In addition, we strive to maintain and improve the initial response capability by conducting emergency drills once a year, establishing initial emergency response headquarters at an enterprise level and in business companies and each division of the business unit, confirming safety of employees and reporting the damage situation between each emergency response headquarters.

Survey of BCP Formulation in Supply Chain

The DOWA group mainly deals with B to B business and a disruption of the supply chain means a strong impact on the production and sales of customers at delivery destinations, therefore, through our CSR procurement, we are checking the formulation of BCP regarding rapid business restoration and its continuation in the event of a disaster, for the benefit of our main partners. For the business partners who are not yet decided, we explain the importance of the initiatives and request strengthening of BCP countermeasures.

DOWA Hotline Desk

With an aim of encouraging the early detection of risks associated with corporate activities and making employees find the workplace environment safer and more comfortable, we have established a "DOWA Hotline desk" that allows direct consultation with corporate lawyers. This is announced conducted through intranet, poster, etc. in which the confidentiality of reporting, etc. is maintained and guaranteed that the whistleblower is not subjected to unfair treatment. To build a healthier partnership with business partners and collaborating companies, we have opened the window of the DOWA Hotline desk outside the company so that it can be availed by the employees of business partners and collaborating companies. At the desk, we maintain the confidentiality of consultations and opinions received and respond promptly and appropriately.

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Relationship with National and Local Governments and Industries

The DOWA Group is promoting activities related to public policies such as international collaboration, participating in councils and forums at government and industrial organizations, solving social issues, establishing and reviewing legal systems.

Example of Participation

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Participation in International Organizations and Consortiums

The DOWA group has been participating in the UN Global Compact (UN GC), which is a voluntary international corporate citizenship advocated by the UN, since 2009. The DOWA group is committed to respecting and implementing the GC's ten principles in four areas of the Global Compact of human rights, labor, environment and anticorruption - these are geared towards sustainable development of society.
Even in formulating CSR procurement policies and guidelines, we reflect the principles of global compact, such as respect for human rights and elimination of child labor.

[ Global Compact Network, Japan ] http://www.ungcjn.org

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Compliance

In the DOWA Group, we have positioned "Legal Compliance" as the fundamental of corporate management and are working on measures to strengthen internal control and education based on the "DOWA Group Values and Code of Conduct."
In addition, each DOWA Group company aims to improve the awareness on compliance by handling the annual internal audits (legal audits).

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