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Corporate Governance

Fundamental Commitment

True to its corporate philosophy, the Kajima Group strives to continually advance its business operations and contribute to society. The Group's objective is to earn the trust and regard of all stakeholders. Kajima's fundamental commitment on corporate governance is to ensure fair and transparent corporate activities using enhanced management supervision by the Board of Directors and Audit & Supervisory Board. This is combined with risk management and accountability achieved via internal controls and systematic steps to ensure compliance.

Corporate Governance Structure

Board of Directors

The Board of Directors of Kajima consists of directors with expert knowledge of the Company’s businesses, along with highly knowledgeable outside directors with a wealth of experience. It makes deliberations and decisions concerning fundamental business policies and important matters, and it audits the execution of duties. The Board of Directors meets once a month and additionally as needed in order to deliberate and decide on fundamental management policies, matters that only the Board of Directors is allowed to handle legally, and other important matters related to management. It audits the execution of duties, and confirms the progress of business plans.

The Personnel Committee and the Governance and Remuneration Committee have been established as advisory organizations to the Board of Directors to strengthen management supervisory functions. Furthermore, an executive officer system has been introduced to separate and bolster supervisory and operational execution functions, as well as to increase the efficiency and speed of management. In addition, a Management Committee and a Joint Committee of Directors and Executive Officers have been established to improve the efficiency of operational execution.

To support the sustainable growth and progress of the Group for years to come based on the corporate philosophy, appointees to the Board of Directors must have the ability to apply the knowledge they have cultivated in their respective fields, such as business, finance, and technology. Candidate selection takes into consideration the diversity and appropriate size of the Board of Directors, while pursuing a balance of knowledge, experience and abilities. To ensure objectivity and transparency in nominating director candidates, the Personnel Committee discusses the basic policy on nomination, the structure of the Board of Directors, and other matters, and then the Board of Directors makes decisions on these matters based on the advice and recommendations of the committee.

Company regulations prescribe that the Board of Directors must be consulted about any conflict of interest between the Company and directors or executive officers, and about any transaction between related parties. A monitoring system is in place so as not to harm the common interests of the Company and our stockholders.

Auditing Framework

As a company with an Audit & Supervisory Board that has adopted an auditor system, Kajima is structured so as to help auditors conduct effective audits, including outside Audit & Supervisory Board members. The Audit & Supervisory Board is comprised entirely of auditors and meets once a month and additionally as needed.

Audit & Supervisory Board members conduct audits while communicating with directors, the internal audit organization, and other organizations in conformity with the Auditor Audit Standards established by the Audit & Supervisory Board and in accordance with audit policies and duty assignments.

In light of the characteristics of full-time personnel, full-time Audit & Supervisory Board Members actively strive to develop an auditing environment and collect internal information, as well as to monitor and verify the status of development and operation of internal controls and systematic steps on a day-to-day basis. In addition, they regularly call meetings to exchange information and communicate with one another. Part-time Audit & Supervisory Board Members attend important meetings, including Board of Directors meetings, and they conduct audits based mainly on daily reports from full-time Audit & Supervisory Board Members.

To ensure objectivity and transparency in nominating auditor candidates, nominees are selected with consent from the Audit & Supervisory Board based on discussions by the Personnel Committee about the basic policy on nomination, the structure of the Audit & Supervisory Board, and other matters.

Personnel Committee and Governance and Remuneration Committee

The Personnel Committee consists of our outside directors and President, and it deliberates on personnel matters related to directors and other staff. The Governance and Remuneration Committee consists of our outside directors and outside Audit & Supervisory Board members, and it deliberates on important governance matters including remuneration for directors and other staff. Established to provide advice to directors, both Committees strive to ensure objectivity and transparency.

Diagram of Corporate Governance Structure

Corporate Governance System

Group Company Management System

We have established the Kajima Group Code of Conduct as guidelines for action applied to all Group companies. Each Group company has also established and implements a compliance framework in line with that of Kajima, including the formulation of a compliance manual and the establishment of a whistleblower system.

For business management, we follow the Group Business Operation Rules, and so we request preparatory discussions and reports from Group companies about decisions on important matters. If needed, we send our officers and employees to Group companies as directors and auditors to conduct appropriate supervision and audits.

Internal Control System to Ensure Appropriate Execution of Business

While assiduously promoting compliance and managing risks in conducting business in an appropriate and efficient manner, we are working to enhance our internal management (internal control) system. For example, for the purpose of implementing the Internal Control Reporting System with the aim of ensuring the reliability of financial accounting, we have introduced the Kajima Group Code of Conduct, the Corporate Ethics Reporting System and other internal rules and regulations. We have also established the Compliance and Risk Management Committee and Internal Control Evaluation Committee on Financial Reporting.

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