Internal Control

Recognizing it as the important management issue to establish, maintain and operate a system in order to ensure that business may be executed in an appropriate manner, we have decided the "Internal Control Basic Policy" at the Board of Directors Meeting.

Internal Control Initiatives and Organization

We have established the Internal Control Basic Policy in compliance with laws and regulations.
Based on this Internal Control Basic Policy, we have developed  a system (internal control system) to ensure the appropriateness of business operations, and properly operate internal controls under the Companies Act and the Financial Instruments and Exchange Act.

Development and Operation of Whistleblowing System

Aiming for transparent and fair group management, we have established a whistleblowing hotline (whistleblowing system) for employees of our Group in order to detect and correct any violations of laws and regulations. The department in charge of compliance serves as the contact point, and we have also established a system both in Japan and overseas where employees can report directly to outside experts, such as lawyers, either anonymously or under their own names.
In the event that any violations of laws or regulations are identified, we will promptly take corrective and preventive measures.

In addition, we will impose strict measures, including disciplinary actions, on employees involved in misconduct, in accordance with our employment regulation.
Furthermore, we have also established relevant internal regulations and have put in place a system to ensure that whistleblowers do not suffer disadvantages as a result of making reports using the whistleblowing system.

Compliance

To specifically provide for the basic views that serve as the basis of compliance from a viewpoint in line with globalization of business and to share such views among the Nikkiso Group, we have established the "Nikkiso Group Global Code of Conduct" (hereinafter referred to as the "GCC").
The "GCC" is the highest level of standards with regard to the Nikkiso Group's compliance and provides for faithful business activities (fair competition, prevention of bribery, trade control, prohibition of insider trading, etc.), protection of corporate assets and management of information (prohibition of transactions involving conflicts of interest, proper accounting reporting, information management, etc.) as well as respect for human rights and harmony with the environment (workplace health, environmental conservation, etc.).
We will forge ahead with our business activities in accordance with the "GCC" and fulfill our social responsibilities

To promote compliance within our Group, we have assigned an executive (director or executive officer) in charge of compliance and established a department responsible for compliance within an administration division, as well as the Risk Management and Compliance Committee under the supervision of Sustainability Committee. We have appropriately developed and implemented a system for timely and proper  reporting to the Board of Directors and Audit & Supervisory Board on the status of compliance.

Basic Approach and Measures to Eliminating Anti-social Forces

At Nikkiso, we make it a basic policy to have no relationships whatsoever with anti-social forces (or organized crime groups) and strongly reject any coercive demands by such groups. This basic policy is clearly incorporated into the board of directors-approved Internal Control Basic Policy. In order to ensure that this basic policy is implemented throughout the organization, all employees are provided with training along with a compliance handbook that spells out the specific rules of conduct they must follow so that everyone is aware of the policy.

A department dedicated to eliminating influence by anti-social forces has been set up within the corporate division to address the issue across the organization. We also make a daily effort to gather information by working with the police and other related organizations to block any interaction with anti-social forces.