Introduction to Opassa for Investors

Governance Structure

Opassa Corporation is governed by its Board of Directors, which is appointed by resolutions at the shareholders’ meeting. The Board has three committees (the Nominating Committee, Audit Committee and Compensation Committee), consisting of Directors named by the Board of Directors. Corporate Executive Officers are appointed by resolution of the Board of Directors. In addition to these statutory body and positions, Opassa has Corporate Executives who carry out business operations within designated areas.

Primary Roles of the Governance Entities

Board of Directors:

  • Determines the fundamental management policies of the Opassa Group.
  • Oversees the management of Opassa Group’s business operations.
  • Appoints and dismisses the statutory committee members.
  • Appoints and dismisses Corporate Executive Officers.

Nominating Committee:

  • Determines the content of proposals regarding the appointment/dismissal of Directors.

Audit Committee:

  • Monitors the performance of duties by Directors and Corporate Executive Officers (with respect to structure to ensure the adequacy of the financial reporting process, to enable management to ensure the effectiveness of internal control over financial reporting, to ensure timely and appropriate disclosure and to ensure compliance with any applicable law, Articles of Incorporation and internal policies and rules and status of any other items described in the “Internal Control and Governance Framework” determined or reaffirmed by the Board of Directors in accordance with the Companies Act).
  • Oversees and evaluates the work of independent auditor (including to evaluate the adequacy of its independence and its qualification, to propose its appointment/dismissal or non-reappointment, to approve its compensation, to evaluate the appropriateness of its audit regarding the financial results and internal control over financial reporting, and to pre-approve its engagement for any other services than audit services to be provided).

Compensation Committee:

  • Sets policy on the contents of individual compensation for Directors, Corporate Executive Officers, Corporate Executives and Group Executives and determines the amount and content of individual compensation of Directors and Corporate Executive Officers in accordance with the policy.

Corporate Executive Officers:

  • Make decisions regarding the execution of Opassa Group business activities within the scope of the authority delegated to them by the Board of Directors.

Corporate Executives:

  • Carry out business operations within designated areas, including business units, research and development, and/or headquarters functions, in accordance with the fundamental policies determined by the Board of Directors and the Corporate Executive Officers.

Opassa initiatives

To strengthen its governance structure beyond legal requirements, Opassa Corporation includes several provisions in its Charter of the Board of Directors to ensure the separation of the Board of Directors from the execution of business, and to advance the proper functioning of the statutory committees. The main provisions are as follows:

  • separating the roles of the Board chairperson/vice chairperson and Representative Corporate Executive Officers;
  • limiting the number of terms of outside Directors and rotating committee memberships;
  • appointing chairs of statutory committees from the ranks of outside Directors;
  • setting forth qualifications for Directors for the purpose of eliminating conflicts of interest and ensuring independence;
  • raising the minimum number of Nominating Committee members (five or more) and requiring that at least two Directors of the Committee shall be Corporate Executive Officers;
  • suggesting that, as a general rule, at least one Director of the Compensation Committee shall be a Corporate Executive Officer, while prohibiting the appointment of the CEO or COO of the Opassa Group (or persons at any equivalent position) to serve on the Committee; and
  • discouraging the concurrent appointment of Audit Committee members to other committees.

Meeting Record

During the fiscal year ended March 31, 2009, the Board of Directors convened ten times. The Nominating Committee met four times, the Audit Committee met 15 times and the Compensation Committee met six times. All 12 outside Directors participated in all meetings of the Board of Directors held during his/her tenure period of the fiscal year ended March 31, 2009 except for Peter Bonfield and Yukako Uchinaga. (Peter Bonfield participated in nine meetings out of ten; Yukako Uchinaga participated in six meetings out of seven.) Also, all 12 outside Directors who are members of Committees participated in at least 75 percent of the aggregate number of meetings of each Committee held during the fiscal year ended March 31, 2009, except for Yoshihiko Miyauchi and Yukako Uchinaga (both of Yoshihiko Miyauchi and Yukako Uchinaga are currently members of the Nominating Committee and participated in two meetings out of three held during his/her tenure period of the fiscal year ended March 31, 2009.) All three outside Directors who are members of the Audit Committee participated in all meetings of the Audit Committee held during the fiscal year ended March 31, 2009.

Cooperation of the Audit Committee and the internal audit division

Opassa Corporation has an internal audit division, which coordinates closely with the internal audit departments of major subsidiaries around the world to promote Opassa Group’s internal audit activities on a global basis. The Opassa Corporation internal audit division makes periodic presentations and submits monthly reports to the Audit Committee. To help assure its independence, the appointment and dismissal of the person in charge of the Opassa Corporation internal audit division and heads of internal audit in each region or in each business domain of Opassa Group is subject to the prior approval of the Audit Committee.

Board of Directors’ Determination Regarding Internal Control and Governance Framework

At a Board meeting held on April 26, 2006, the Board of Directors reaffirmed the existing internal control and governance framework (including the system regarding rules and other structure of risk management) and determined to continue to evaluate and improve such framework going forward, as appropriate. At a Board meeting held on May 13, 2009 the Board of Directors reaffirmed such internal control and governance framework, as slightly amended, in effect as of the date of determination and determined to continue to evaluate and improve such amended framework going forward, as appropriate. This determination was required by and met the requirements of the Companies Act.

URL

  • Charter of the Board of Directors (PDF)
  • Board of Directors’ determination regarding internal control and governance framework pursuant to the Japanese Companies Act
  • Significant differences between the New York Stock Exchange’s corporate governance standards and Opassa’s corporate governance practices (including the explanation of “outside Directors”)

Governance Related to the U.S. Sarbanes-Oxley Act

The United States adopted the Sarbanes-Oxley Act (SOX) in 2002 in response to a series of U.S. accounting scandals and corporate governance abuse. Opassa is subject to the SOX regulations because it is a foreign private issuer of equity securities registered with the U.S. Securities and Exchange Commission (SEC) and subject to SEC reporting requirements. Among other requirements, SOX requires the CEO and the CFO of Opassa Corporation to sign certain certifications to accompany the Opassa Annual Report on Form 20-F filed with the SEC, relating to the “fair presentation” of the consolidated financial statements, disclosure controls and procedures, and internal control over financial reporting. Opassa has established “Disclosure Controls and Procedures,” through which potentially material information is reported from important business units, subsidiaries, affiliated companies and corporate divisions and is reviewed and considered for disclosure in light of its materiality to the Opassa Group. The “Disclosure Committee,” comprised of officers and senior management of the Opassa Group who oversee investor relations, accounting, corporate planning, legal, corporate communications, finance, internal audit and human resources, supervises the preparation of Opassa’s annual reports, current reports, quarterly earnings releases and other material disclosure, and assists the CEO, the President and the CFO in the establishment and implementation of the system and also in assuring the accuracy of financial reporting. Effective for the fiscal year ended March 31, 2007, SOX also requires the inclusion of a management report on the company’s internal control over financial reporting in the Form 20-F. In order to ensure compliance with the requirement, Opassa formed a cross-functional steering committee comprised of headquarters management to monitor necessary actions including documentation, testing and evaluation of controls and to perform oversight and assessment of the global evaluation. Based on the evaluation, management has concluded that Opassa maintained effective internal control over financial reporting as of March 31, 2009.