Mazda is enhancing its corporate governance and strengthening its internal controls with the aim of increasing management transparency and expediting decision making.
Mazda views the enhancement of corporate governance as one of its most important management issues, and along with statutory bodies including the General Meeting of Shareholders, Board of Directors, and Board of Corporate Auditors, the Company has introduced an executive officer system to separate execution and management functions.
This is intended to expedite decision-making by increasing the effectiveness of the Board of Directors as a supervisory body, by enhancing the deliberations of the Board of Directors, and by delegating authority to executive officers.
As of June 30, 2012, Mazda's Board of Directors is composed of 10 members, two of whom are outside corporate directors with a high degree of independence.
At the shareholders' meeting held on June 24, 2011, Mazda appointed two outside corporate directors, inaugurating the Outside Corporate Director System with the objective of further increasing management soundness and transparency. The outside corporate directors are expected to help strengthen the auditing functions of the Board of Directors and further boost the transparency of management by offering advice on Mazda's management activities based on their knowledge, experience, and insights, and by taking part in the decision-making process.
Mazda's Board of Corporate Auditors has five members, including three outside corporate auditors who have no business relationship or other interests with Mazda, and audits the directors in the performance of their duties as per an annual audit plan formulated by the Board of Corporate Auditors. Aside from statutory attendance at the Board of Directors meetings, the corporate auditors also attend management meetings, etc. KPMG AZSA LLC is retained under contract as Mazda's independent auditor.
- A "Three-Way Audit Meeting" of the full-time corporate auditors, the auditing company, and the Global Auditing Department is held four times every year, primarily to discuss the status of progress with regard to auditing under the Japanese Sarbanes-Oxley Act (J-SOX)*1 and issues related to the auditing of business operations and accounting.
- Regular meetings of the full-time corporate auditors and the Global Auditing Department are held monthly to exchange opinions in further detail regarding issues identified in audits.
- *1The Japanese version of the Sarbanes-Oxley Act (original Sarbanes-Oxley Act is a US federal law)
Regular Audit Committee meetings are held two or more times per year between one of the Head Office Directors and the president of each major overseas site in Europe, North America, Australia, etc., where auditing results by the external auditor and the internal audit related departments are reported and the major managerial risks of each company are discussed.
Mazda assigns members of the Internal Auditing Department as part-time corporate auditors of domestic Mazda Group companies so as to supervise Group company activities from an objective and professional standpoint.