Corporate Governance

• Corporate Governance System
• Board of Directors
• Audit and Supervisory Board Members
• Nomination and Compensation Committees
• Director Training
• Analysis and Evaluation of the Board of Directors' Effectiveness
• Operating Officer System and Operating Officers

Corporate Governance System

NISSEI’s basic approach to corporate governance is to recognize the importance of strengthening the management oversight functions as well as ensuring prompt decision-making process and effective execution of business operations. In doing so, they can meet the expectations of its stakeholders, achieve sustainable growth, and improve their corporate value over medium and long terms. NISSEI partially amended its Articles of Incorporation on June 24, 2022 to strengthen its management structure and supervisory function. NISSEI transitioned from a Company with a Board of Company Auditors to a Company with an Audit and Supervisory Committee. Currently, the Board of Directors consists of 11 Directors, including 4 outside Directors.

Basic Information

Board of Directors

The Board of Directors is chaired by the Representative Director.

The reason why the Representative Director serves as a chair is because it requires having the insights of the injection molding industry and understanding of business operation within the Company.

The Board of Directors consists of 11 members.

• Directors who are non-members of the Audit and Supervisory Committee: 8 people (including two outside Directors)
• Directors who are member the Audit and Supervisory Committee: 3 people (including two outside Directors)

The term of Directors (excluding directors who are members of the Audit and Supervisory Committee) is set at one year for the purpose of clarifying their responsibility for business administration as directors and enabling prompt response to the ever-changing management environment.

The Board of Directors is responsible for making manegial decisions and supervising business executions. They deliberate and decide important management matters as stipulated in laws and regulations, the Articles of Incorporation, and Board of Directors Regulations. The Board of Directors also convenes the Management Committee as an assembly to discuss and report on important matters to be brought before the Board of Directors. The Management Committee effectively functions as a body to deliberate and check the execution of duties by the Directors in advance.

Audit and Supervisory Board Members

The Audit and Supervisory Committee consists of three Directors (including two outside Directors) who are members of the Audit Committee. The Audit and Supervisory Committee is chaired by a full-time Audit and Supervisory Committee Member. The Audit and Supervisory Committee Members attend the Board of Directors meetings, the Management Committee meetings, and other important internal meetings to ensure the integrity and transparency of business operations and provide input as necessary to safeguard the validity of decision-making processes. In addition, the Representative Director and the Audit Committee hold regular meetings to exchange opinions. They conduct thorough audits by interviewing about the status of business execution by the Executive Directors, reviewing reports, and inspecting written resolutions on important matters.

Nomination and Compensation Committees

NISSEI has established the Nomination Committee and Compensation Committee as advisory bodies to the Board of Directors for the purpose of enhancing corporate governance by ensuring the fairness, transparency, and impartiality related to the nomination and compensation of Directors. The Nominating Committee and the Compensation Committee are composed of three Directors with executive positions and four outside Directors, so that the majority of the members are outside Directors.

Nomination Committee

The Nominating Committee selects Director candidates in accordance with the criteria for the Election of Candidates for Directors. In addition to meeting the criteria to be Director candidates, the committee comprehensively examines and discusses Executive Directors to be reappointed based on their contributions to the company during their terms of office and the results of the annual evaluation by the Board of Directors to ensure a high level of transparency.

Compensation Committee

Compensation for NISSEI’s Executive Directors consists of monetary and performance-linked compensations (including stock options). The Compensation Committee discusses Director compensations based on the Company’s compensation criteria as well as taking their performances, contributions, positions, and other factors into considerations. The board of Directors reviews the results of the discussions and then makes decisions to ensure a high level of transparency.

Director Training

NISSEI recognizes that it is important for Directors to keep improving their skills and expand knowledge in order to effectively fulfill their duties and responsibilities. Accordingly, NISSEI arranges third-party training programs for Directors upon their appointments to ensure that they have the foundation of carrying out duties as Directors. In addition, NISSEI has established a system that allows Directors, including outside Directors, to participate in third-party training programs as needed at the Company’s expense.

Analysis and Evaluation of the Board of Directors' Effectiveness

NISSEI understands that the expectations for the Board of Directors and the climate surrounding its business operation are continuously changing. NISSEI assesses the effectiveness of the Board by conducting survey on the Board of Directors roles, functions, operations, and improvement to the Executive Directors (including those who are in the Audit and Supervisory Committee). As a result of the survey, the composition of the Board of Directors will be considered to have more diversity and add the number of members from the perspective of strengthening governance and fostering the next generation. Briefings to outside directors at the Board of Directors meetings as well as at the Nomination and Compensation Committee meetings are ensured to be informative and detailed. In addition, the Nomination and Compensation Committees have clear definitions for selecting director candidates and indicators for thier compensations. Based on these evaluations, NISSEI improves their operation efficiency continuously.

Operating Officer System and Operating Officers

NISSEI has introduced an Operating Officer System. Operating Officers are appointed by the Board of Directors and perform their duties according to the management policies and management decisions made by the Board of Directors. The Board of Directors and the Representative Director oversee and supervise the Operating Officers.

As of June 30, 2024, there were five Operating Officers as follows: