In accordance with the Companies Act and the Enforcement Regulations of the Companies Act, the Group has established the following basic policy for the establishment of an internal control system to ensure the appropriateness of the Company's operations, and under this system, the Group strives to ensure the legality and efficiency of the Company's operations and to manage risks. At the same time, the Company is committed to improving and enhancing the system by constantly reviewing it in response to changes in the business environment.
A) System to ensure that the execution of duties by directors and employees complies with laws and regulations and the Articles of Incorporation
The Company shall establish and maintain a compliance system by ensuring that all directors and employees are familiar with the Compliance Charter, which serves as a code of conduct to ensure that the execution of their duties complies with laws and regulations and the Articles of Incorporation and fulfills social responsibilities.
In addition, the Company shall ensure the appropriate operation of the whistle-blowing system, which allows directors and employees to report to the Company any act that violates or is likely to violate laws, regulations, the Articles of Incorporation or internal rules.
B)System for the storage and management of information related to the execution of duties by directors
Documents and other information relating to the execution of duties by Directors shall be stored and managed appropriately in accordance with the Document Handling Rules.
C)Rules and other systems for managing the risk of loss
a）Management of management risks in accordance with the Risk Management Regulations, which are designed to assess risks and ensure thorough risk management.
b）In addition to the Board of Directors, the General Management Committee, which meets once a month, reviews and evaluates various issues from a company-wide perspective, including management issues, business issues, and overseas business conditions, and establishes and operates a risk management system that enables effective countermeasures to be taken for risks that the Group may face in the future.
D)The establishment and operation of a risk management system capable of implementing a system to ensure the efficient performance of the directors' duties.
(a) The Board of Directors shall meet once a month as the basis for a system to ensure the efficient execution of duties by the Directors, and shall also meet on an ad hoc basis as necessary to ensure prompt and accurate decision-making on important matters.
(b) The Company's performance shall be managed in accordance with the annual plan and the medium-term management plan, which are formulated annually based on the Company's management philosophy or important guidelines.
(c) In the day-to-day execution of business, authority shall be delegated in accordance with the Rules on Administrative Authority and the Rules on Division of Duties, etc., and the person in charge shall execute business in accordance with the decision-making rules in each phase.
E)System to ensure the appropriateness of business operations of the corporate group consisting of the Company and its subsidiaries
The Company and its group companies shall strive to improve the corporate value of the entire group and to ensure the appropriateness of business operations of the group as a whole by providing guidance, advice, and evaluation through close coordination of instructions, orders, and communication within the group in accordance with the Compliance Rules, Risk Management Rules, and Overseas and Domestic Affiliated Company Management Rules, etc. based on the group management philosophy. We will also provide guidance, advice and evaluations to ensure the proper conduct of business for the entire Group.
F)Matters related to employees who are requested by corporate auditors to assist them in their duties, and matters related to the independence of such employees from directors
In the case of appointing employees to assist corporate auditors in their duties, their appointment, transfer, evaluation and disciplinary action shall be made after respecting the opinions of the Board of Corporate Auditors, and the independence of such employees from directors shall be ensured.
G)System for directors and employees to report to corporate auditors and other systems for reporting to corporate auditors
(a) Representative directors and directors in charge of business execution shall comply with the regulations of the Board of Directors and report the status of execution of the business they are in charge of at any time at important meetings such as the General Management Committee.
(b) The directors and employees of the Company and its group companies shall immediately report to the corporate auditors when they become aware of facts that may cause significant damage to the Company, or facts that may violate laws, regulations or the Articles of Incorporation.
(c) The Company and its Group companies shall not dismiss or otherwise treat disadvantageously any person who has made a report to the Corporate Auditors on the grounds that he or she has made such a report.
H) Other systems to ensure that the audits of the Company's corporate auditors are carried out effectively
The Company shall establish an internal system that enables corporate auditors to exercise their authority without hindrance by attending various important meetings and inspecting major approval documents and other important documents. In addition, the Corporate Auditors shall cooperate with the Directors by exchanging information, etc., to ensure that the reporting and communication system functions sufficiently.
I) Matters relating to the procedures for prepayment or redemption of expenses arising from the execution of duties by the Company's Corporate Auditors and other policies relating to the disposal of expenses or liabilities arising from the execution of such duties
In the event that a corporate auditor makes a request for the prepayment or redemption of expenses incurred in the performance of his or her duties, such expenses or debts shall be promptly dealt with, except in cases where it is recognized that such expenses or debts are not necessary for the performance of the duties of the corporate auditor.
J) Systems to ensure the reliability of financial reporting
In order to ensure the reliability of financial reporting, the Company shall establish a system for the development and operation of effective and appropriate internal controls in accordance with the Financial Instruments and Exchange Act and other relevant laws and regulations, and shall continuously evaluate the proper functioning of this system and take necessary corrective measures.
K) System to eliminate antisocial forces
In addition to eliminating any relationship with antisocial forces, the Company shall take a resolute stance against unreasonable demands from antisocial forces in close cooperation with the police and lawyers.