Corporate GovernanceSUSTAINABILITY FOR THE MEDIA DO GROUP

Basic Policy

To accomplish its mission and vision, MEDIA DO has put forth the basic management policy of improving corporate value and thereby maximizing shareholder value over the medium to long term based on an accurate understanding of the importance of its various stakeholders. MEDIA DO recognizes the following as important management issues to be addressed as its management grows increasingly more global: The expedition and streamlining of management decisions to facilitate the further broadening of its business and the heightening of corporate value, and the improvement of management health and transparency through enhanced corporate governance. Entrenching corporate ethics and awareness of these principles throughout the Company will be imperative to improving the health and transparency of management. By fostering such awareness, MEDIA DO aims to develop a corporate culture in which all internal institutions, officers, and employees make fair and accurate decisions. Meanwhile, improving management transparency, and thereby building long-term, trusting relationships with stakeholders, will require prompt and proactive disclosure of information. Systems for information disclosure, both legally mandated and voluntary, are therefore being enhanced toward this end.

To ensure impartial and highly effective management, MEDIA DO will continue to strengthen its corporate governance systems through such means as more effectively allocating resources, expediting decisions, and entrenching compliance awareness under the guidance of the Board of Directors.

For more information, please refer to below.
- MEDIA DO Basic Corporate Governance Policy

Corporate Governance System

At the Company, the Board of Directors has the highest authority for management decision-making while the Audit & Supervisory Board carries out the management oversight function. In addition, the Company’s Executive Committee is a committee of similar standing to the Board of Directors, with the former associated with the operational execution functions of directors and executive officers and the latter involved in management decision-making and operation oversight functions. This division of functions contributes to increased efficiency in operational execution.

The Company has selected the Company with Board of Company Auditors structure described in the Companies Act of Japan for its organizational structure as this structure provides for two lines of checks on operational execution through supervision by the Board of Directors and audits from the perspectives of legal compliance and appropriateness by the Audit & Supervisory Board. Under the Company’s current corporate governance system, all outside Audit & Supervisory Board members have been designated as independent auditors as stipulated by the Tokyo Stock Exchange, while the two outside directors are designated as independent directors.

This composition makes it possible for outside Audit & Supervisory Board members to audit the operational execution of directors with operational execution functions (executive directors) from the perspectives of legal compliance and appropriateness. Similarly, outside directors are able to exert influence on executive directors through the supervision of their exercise of voting rights at meetings of the Board of Directors and the appropriateness of these decisions. With all officers performing their functions in this manner, the Company is working to protect the interests of general shareholders. Furthermore, the Nomination and Compensation Committee was voluntarily established in June 2021 to facilitate the improvement of management transparency and impartiality, to strengthen the oversight function of the Board of Directors, and to expedite the execution of decisions.

Functions and Role of Corporate Governance System Constituents

NameOverview
1. Board of Directors
Number of Meetings / Frequency in FY2021
17 times a year

The Board of Directors is the Company’s highest management decision-making body. Based on the internal regulations for the Board of Directors, the Board of Directors makes decisions on important matters (management policies, business plans, acquisition and disposal of important assets, etc.) and supervises the status of operational execution. Regular meetings of the Board of Directors are held once a month, in principle, and special meetings are convened as necessary.

2. Representative Director

As the chief executive and the head of management, the representative director directs discussions at Board of Directors meetings and oversees all aspects of operational execution at the Company.

3. Audit & Supervisory Board
Number of Meetings / Frequency in FY2021
14 times a year

Audit & Supervisory Board members attend meetings of the Board of Directors to maintain an understanding of conditions within the Company and perform audits of operations along with accounting audits by interviewing directors and reviewing relevant documents. The standing Audit & Supervisory Board member also attends important meetings other than those of the Board of Directors to provide for sufficient oversight of the status of operational execution by directors. The Audit & Supervisory Board meets once a month. At meetings, the three Audit & Supervisory Board members establish audit plans and review the status of audit implementation and audit results and perform other tasks to ensure effective and efficient audits. Moreover, information is shared between Audit & Supervisory Board members, the Internal Audit Office, and the accounting auditor to ensure efficient and synergetic audit.

4. Executive Committee
Number of Meetings / Frequency in FY2021
Once a week

The Executive Committee comprises four internal directors and one standing Audit & Supervisory Board member. This committee meets once a week, in principle, primarily to discuss matters pertaining to business operation and to facilitate efficient operational execution through the examination and decision of matters pertaining to regulations for divisions of authority and basic operational execution items related to management that are not decided by the Board of Directors.

5. Internal Audit Office

The Internal Audit Office is an organization under the direct jurisdiction of the representative director, president and CEO. This organization reports directly to the Board of Directors and performs internal audits in accordance with the plans approved by the representative director, president and CEO. In this manner, the office audits the Company’s business activities while supervising the actions of directors and employees from the perspective of legal compliance. Any requests for improvements issued as part of these audits are submitted directly to the respective divisions and Group companies via the representative director, president and CEO to drive the necessary improvements.
The results of internal control audits are reported to the Board of Directors and the Audit & Supervisory Board.

6. Sustainability Committee
Established on June 1, 2022

The Sustainability Committee is chaired by the director in charge of corporate divisions and membered by oversight representatives that divisions have defined to clarify responsibility for managing risks and opportunities and is tasked with guiding the evolution of MEDIA DO into a more sustainable organization and company. Positioned beneath the Board of Directors, this committee reports to the Board of Directors on the findings of its discussions when appropriate. Meetings are held as necessary (once a quarter, in principle) as the committee seeks to identify, manage, and oversee business opportunities and risks based on a broad definition of risk management incorporating the perspectives of social expectations related to such matters as ESG and the UN SDGs. This approach is taken to facilitate management and strategy implementation based on MEDIA DO’s mission and vision.

7. Nomination and
Compensation Committee

Number of Meetings / Frequency in FY2021
Five times a year

The Nomination and Compensation Committee shall be comprised of three or more directors, including the representative director, appointed via resolution of the Board of Directors, a majority of which should be outside directors designated as independent directors. The chairperson of this committee shall be selected from among the members who are outside directors designated as independent directors based on a majority vote by members. These measures will be taken in order to ensure high levels of independence and transparency. As an advisory body to the Board of Directors, the Nomination and Compensation Committee reports to the Board of Directors on its examinations and deliberations pertaining to matters such as the nomination of director candidates, the appointment and dismissal of directors and executive officers, policies and procedures related to the compensation of directors and executive officers, and succession plans for the president and CEO.

Policies for Appointment of Directors and Audit & Supervisory Board Members

The articles of incorporation stipulate that the Board of Directors should comprise eight or less directors and that the Company should have four or less Audit & Supervisory Board members. Within this scope, the Company’s basic policy is to choose the membership of the Board of Directors that is deemed ideal while considering the balance of business knowledge, experience, and skills of members as well as their gender and other diversity aspects. From the perspectives of objectivity and transparency, candidates for positions as directors are selected by the Board of Directors after consulting with the Nomination and Compensation Committee and receiving reports on the discussions and evaluations of this committee. Evaluations and decisions regarding director candidates are carried out with comprehensive consideration paid to their experience, insight, and specialties based on MEDIA DO’s business philosophy and management strategies. In selecting candidates for positions as outside directors and outside Audit & Supervisory Board members, the Company seeks individuals that fulfill the requirements for outside directors and outside auditors stipulated by the Companies Act of Japan and for independent directors and independent auditors put forth by the Tokyo Stock Exchange. Moreover, these individuals must not present the risk of conflicts of interest with general shareholders.

Director

Name Possessed specialization/ Field of expected contribution
Corporate management/ management strategies Legal affairs/ risk management Finance & accounting/ capital policy Technologies/ Systems Personnel/ HR development Internal control/ Governance ESG/ Sustainability Marketing/ Business development International experience Industry experience Independence
Yasushi Fujita
Shin Niina
Atsushi Mizoguchi
Hiroshi Kanda
Ayako Kanamaru
Haruo Miyagi

Audit & Supervisory Board Member

Name Possessed specialization/ Field of expected contribution
Corporate management/ management strategies Legal affairs/ risk management Finance & accounting/ capital policy Technologies/ Systems Personnel/ HR development Internal control/ Governance ESG/ Sustainability Marketing/ Business development International experience Industry experience Independence
Kazuyoshi Ohwada
Toshiaki Morifuji
Tsuyoshi Shiina
Director Reason for Appointment
Yasushi Fujita
President and CEO
Attendance at Board of Directors Meetings
17/17

As the founder of the Company, Yasushi Fujita is well versed in all of its business and has a wealth of experience and exceptional insight as a manager. He was appointed to his current position so that his wealth of experience and exceptional insight can be utilized in the management of the Company.

Shin Niina
Director, Vice President, and COO
Attendance at Board of Directors Meetings
17/17

Shin Niina is knowledgeable in the publishing industry and in the eBook industry and has been involved in a wide range of business within these industries and also possesses a wealth of experience and exceptional insight as a manager. He was appointed to his current position so that his wealth of experience and exceptional insight can be utilized in the management of the Company.

Atsushi Mizoguchi
Director
Attendance at Board of Directors Meetings
17/17

Atsushi Mizoguchi has a breadth of experience in digital distribution, digital libraries, new business development, and other businesses that are central to the Company as well as deep insight into mobile communications and IT. He was appointed to the position of director so that his wealth of experience and exceptional insight can be utilized in the management of the Company.

Hiroshi Kanda
Director
Appointed to current position in May 2022

Hiroshi Kanda has been in charge of the Corporate Planning Office, and while being acquainted with the management strategies of the MEDIA DO Group, investor relations activities, corporate governance and other aspects, he has extensive experience and in-depth knowledge as a corporate manager. He was appointed to his current position so that his wealth of experience and exceptional insight can be utilized in the management of the Company.

Ayako Kanamaru
Outside Director*
Attendance at Board of Directors Meetings
13/13

As an attorney at law, Ayako Kanamaru has extensive experience and expert knowledge related to general corporate legal affairs encompassing international transactions, internal controls and corporate governance. She has been providing appropriate advice and supervision for the management of the Company as outside Director. The Company proposes her election as outside Director again in expectation of applying such knowledge and experience to the Company’s risk management and governance domains. She has never been involved in the management of a company in the past, except as an outside Director or outside Audit & Supervisory Board Member. However, the Company judges she will appropriately fulfill her duties as an outside Director based on the above reasons. She is expected to provide pertinent advice from the viewpoint of risk management and governance based on her knowledge and experience as an attorney at law, and effective supervision of the management team from an independent and objective standpoint.

Haruo Miyagi
Outside Director*
Appointed to current position in May 2022

Haruo Miyagi has extensive experience and in-depth knowledge regarding business support and organizational operation in a broad range of fields as the Representative Director of an NPO dedicated to the fostering and mentoring of entrepreneurial leaders. The Company proposes his election as an outside Director in the expectation of applying such experience and knowledge to further strengthen business promotion and organizational operation in the Media Do Group. He has never been involved in the management of a company in the past, except as an outside Director or outside Audit & Supervisory Board Member. However, the Company judges he will appropriately fulfill his duties as an outside Director based on the above reasons. He is expected to provide pertinent advice from his viewpoint on promotion of business and organizational operation in a broad range of fields, based on his long-standing knowledge and experience gained through fostering and supporting entrepreneurial leaders, and effective supervision of the management team from an independent and objective standpoint.

Audit & Supervisory Board Member Reason for Appointment
Kazuyoshi Ohwada
Standing Audit & Supervisory Board Member
Attendance at Board of Directors Meetings
17/17
Attendance at Audit & Supervisory Board Meetings
14/14

Kazuyoshi Ohwada has experience in the human resource, general affairs, and finance and accounting divisions of the Company and possesses the insight necessary for facilitating the healthy and appropriate operation of the Company. He was appointed to the position of Audit & Supervisory Board member because it was judged that he is capable of effectively fulfilling this role.

Toshiaki Morifuji
Outside Audit & Supervisory Board Member*
Attendance at Board of Directors Meetings
17/17
Attendance at Audit & Supervisory Board Meetings
14/14

Toshiaki Morifuji is qualified as a certified public accountant and therefore has considerable insight pertaining to finance and accounting. He was appointed to the position of outside Audit & Supervisory Board member out of 17/17 consideration for this insight.

Tsuyoshi Shiina
Outside Audit & Supervisory Board Member*
Attendance at Board of Directors Meetings
17/17
Attendance at Audit & Supervisory Board Meetings
14/14

Tsuyoshi Shiina is qualified as a lawyer and a tax accountant and therefore has considerable insight pertaining to corporate legal affairs, finance, and accounting. He was appointed to the position of outside Audit & Supervisory 17/17 Board member out of consideration for this insight.

* Notification has been submitted designating the individuals in question as independent directors or auditors as stipulated by the Tokyo Stock Exchange.

Compensation of Directors and Audit & Supervisory Board Members

Compensation for directors is decided in accordance with the basic policies detailed to the right. In line with the basic policies, compensation for executive directors is comprised of monetary compensation (not considered performance-linked compensation) and stock compensation. Monetary compensation consists of basic compensation and commitment-linked compensation.

  • Compensation systems for directors should be designed to generate strong motivation to pursue ongoing improvements in corporate value.
  • Compensation systems should also incorporate objective and transparent procedures founded on principles of accountability toward shareholders and other stakeholders.
  • Compensation amounts should be set appropriately based on the roles and responsibility of each individual director.

Ratios of Executive Officer Compensation by Type

Fixed
compensation
Performance-linked
compensation
Monetary Stock Monetary
Approx.
70%
Approx.
20%
Approx.
10%

Previously, the compensation to be paid to individual directors in a given fiscal year was decided based on comprehensive consideration of the role, degree of contribution, performance, and other factors pertaining to the director by the representative director, president and CEO based on authority delegated by the Board of Directors while the compensation of Audit & Supervisory Board members was determined through discussion among auditors. However, in June 2021 the Company established the Nomination and Compensation Committee as an advisory body to the Board of Directors tasked with examining and discussing matters pertaining to the nomination and compensation of directors for the purpose of ensuring the objectivity and transparency of decisions regarding these matters.

See more: Corporate Governance Report
(Date of Latest Update: May 27, 2022)