Mitsubishi Corporation

Corporate Governance

Basic Policy

MC's corporate philosophy is enshrined in the Three Corporate Principles—Corporate Responsibility to Society, Integrity and Fairness, and Global Understanding Through Business. Through corporate activities rooted in the principles of fairness and integrity, MC strives to continuously raise corporate value. MC believes that by helping to enrich society, both materially and spiritually, it will also meet the expectations of shareholders, customers and all other stakeholders.

In order to ensure sound, transparent and efficient management, MC has put in place a corporate governance system, based on the Corporate Auditor System. This includes strengthening management supervision by appointing independent directors and independent corporate auditors, and using the executive officer system to expedite and bolster decision-making and business execution.

Corporate Governance Framework (As of April 1,2014)

Board of Directors

MC's Board of Directors has 14 members, including five outside directors. Outside directors represent more than one-third of all directors. Board meetings are also attended by the five corporate auditors, three of whom are outside corporate auditors.

As a rule, the Board convenes once a month and is responsible for making decisions concerning important management issues and overseeing business execution. The objective and expert viewpoints of outside directors and outside corporate auditors ensure appropriate decisionmaking and management oversight.

Board of Directors' Advisory Bodies

MC also has a Governance & Compensation Committee and an International Advisory Committee as advisory bodies to the Board of Directors. These committees are made up mostly of outside directors and outside corporate auditors as well as other experts from outside MC. The Governance & Compensation Committee conducts continuous reviews of corporate governance-related issues at MC and also discusses the remuneration system for directors and corporate auditors, including the policy for setting remuneration and appropriateness of remuneration levels for these corporate officers, and monitors operation of this system. The International Advisory Committee holds discussions on management issues and advises MC management from a global perspective.

Business Execution

The president, as the Company's chief executive officer, manages the Company's business through the Executive Committee, a decision-making body of executive officers. Important management issues are first determined by the Executive Committee, which meets around twice a month, and then referred to the Board of Directors for deliberation and final determination.

Furthermore, in order to clarify the functions and responsibilities of officers for executing duties, we introduced the executive officer system, thereby promoting faster and more efficient business execution.

Selection Criteria for Outside Directors and Outside Corporate Auditors

MC has worked to expand and improve the number and quality of outside directors and outside corporate auditors in order to strengthen supervision. We have established selection criteria for outside directors and outside corporate auditors to clarify the role and selection policy for these individuals.

Selection Criteria for Outside Directors

  1. Outside directors are elected from among those individuals who have an eye for practicality founded on a wealth of experience as corporate managers, as well as an objective and specialist viewpoint based on extensive insight regarding global conditions and social and economic trends.
    Through their diverse perspectives, outside directors help ensure levels of decision-making and management oversight appropriate to the Board of Directors.
  2. To enable outside directors to fulfill their appointed task, attention is given to maintain their independent stance; individuals incapable of preserving this stance will not be selected to serve as outside directors.
  3. MC operations span a broad range of business domains; hence there may be cases of conflict of interest stemming from business relationships with firms home to the corporate managers appointed as outsider directors. MC copes with this potential issue through the procedural exclusion of the director in question from matters related to the conflict of interest, and by preserving a variety of viewpoints through the selection of numerous outside directors.

Selection Criteria for Outside Corporate Auditors

  1. Outside corporate auditors are selected from among individuals possessing a wealth of knowledge and experience across various fields that is helpful in performing audits. Neutral and objective auditing, in turn, will ensure sound management.
  2. To enable outside corporate auditors to fulfill their appointed task, attention is given to maintain their independent stance; individuals incapable of preserving this stance will not be selected to serve as outside corporate auditors.
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