Investor Relations

Corporate Governance Structure

Basic Approach to Corporate Governance

The Air Water Group believes that conducting fair business activities observing social common sense and gaining trust from shareholders, customers, local communities, employees and all other stakeholders is essential for continuous business growth and maximizing enterprise value. We view comprehensive corporate governance including an internal control system as the most important management issue for gaining stakeholder trust and fulfilling corporate social responsibility. Air Water is working to strengthen its corporate governance by constructing a fully functioning management structure for appropriate management decision-making and the proper and swift execution of business based thereon, with supervision and monitoring, while securing management transparency through wide-range information disclosure.

Compliance Framework

As the foundation of its compliance structure, Air Water has established the “Air Water Group-Code of Ethical Conduct” as an action guideline so that directors and employees of the company and its group companies comply with the law and practice behavior respecting social ethics. Air Water conducts education on the spirit of observing social ethics and the law, and establishes rules regarding legal compliance.
Directors report business activities in regular meetings of the Board of Directors or at other times as necessary and mutually review and supervise activities. In addition, each auditor including external auditors, attend meetings of the Board of Directors and other important meetings in accordance with the auditors' inspection standards established by the Board of Auditors. They also audit the state of business implementation at group companies as part of their supervision of the execution of duties of the directors.
The Internal Auditing Office, which is Air Water's internal auditing unit, carries out internal audits of the state of compliance with internal regulations and laws in the conduct of the business activities of Air Water and its group companies in accordance with the internal auditing regulations and internal audit plan. In addition, there is a system for reporting the results of the internal audit to the representative directors and standing auditors. Regarding compliance with the Antimonopoly Act, the company receives periodic advice from outside specialists, and conducts ongoing education of directors and employees concerning the Antimonopoly Act. Furthermore, in addition to strictly regulating contacts with competitors, the Compliance Center maintains a system for periodic monitoring of the implementation of internal regulations and state of compliance concerning the Antimonopoly Act in each of Air Water's operating divisions as well as its group companies.

Risk Management Structure

The Compliance Center, which is under the direct control of the representative directors, manages compliance items recognized as particularly important risks for business activities and risks concerning safety, disaster prevention and environmental preservation at Air Water and its group companies, as the supervisory division for the entire Air Water Group.
Individual risks concerning information security, quality control, intellectual properties and business contracts are managed through prior inspection and authorization procedures. Also by enacting internal regulations and creating manuals, the education and training at the level of each responsible division are carried out.
From August 2011, the Compliance Center has regularly held a risk management committee as a secretariat responsible for assessing the risk management framework in each division and group company, and for bolstering the risk management framework in the Air Water Group overall. If a risk with significant impact on business activities is realized, a Crisis Management Committee will be established immediately in accordance with the Risk Management Regulations, and a framework for dealing with the realized risk promptly and appropriately will be put in place.

Internal Audits

Internal audits are conducted periodically by the Internal Auditing Office, which is the Company's internal auditing unit, to audit the Air Water Group's compliance with laws and internal regulations, as well as the propriety and appropriateness of its business processes. The Internal Auditing Office also supervises and monitors the construction and administration of internal control systems to secure the reliability and propriety of financial reports, and evaluates their validity as the division in charge under the responsibility and direction of the representative directors. In addition to the Internal Auditing Office, Air Water has also established a Compliance Center as an exclusive unit for the management and control of compliance, safety and disaster prevention, and environmental preservation across the Air Water Group. Under our management structure, the Internal Auditing Office and Compliance Center report to the auditors and to the representative directors as appropriate when their internal audits confirm facts that might have a material effect on Air Water's management.