To ensure efficient, sound, and transparent management, Alpine works hard to strengthen our corporate governance structure
Basic Approach to Corporate Governance
Alpine manufactures on-board information systems and equipment as a member of the Alps Group led by Alpine's parent company, Alps Electric Co., Ltd.
The Alps Group defines corporate governance as the “establishment and operation of frameworks for the realization of efficient and appropriate decision-making and execution of duties by senior management, prompt reporting of outcomes to stakeholders, and sound, efficient and transparent business administration for the purpose of heightening corporate value.” We place importance on the sustainable development of shareholders and all other stakeholders, and the maximization of their mid-to-long-term benefits; therefore, our basic approach involves the maximization of corporate value and the delivery of benefits directly or indirectly to stakeholders in a balanced way to satisfy their respective interests.
We also have established the Alpine Corporate Governance Policy to facilitate our ability to realize effective corporate governance and fulfill our responsibilities to all of our stakeholders: shareholders, customers, local communities, and employees. We work on the fulfillment and improvement of this policy, and the smooth operation under the governance structure, including the Audit and Supervisory Committee, in our mid-term business plan. Visit the following web page for more information about the Alpine Corporate Governance Policy.
Corporate Governance Structure
We have adopted the structure of a company with an audit and supervisory committee for corporate governance pursuant to the Companies Act of Japan. Through the enhancement of auditing and supervising functions in close cooperation with accounting auditors and the Internal Audit Division, the Audit and Supervisory Committee, which is independent from the persons who execute the business, further strengthens our corporate governance structure, and improves the soundness and transparency of our corporate management.
Corporate Governance Structure (as of June 2018)
As a member of the Alps Group, Alpine places a priority on following the founding principles of the Alps Group led by Alps Electric Co., Ltd. We established our basic philosophy and conduct guidelines for compliance in accordance with the Alps Group management regulations, and promote compliance throughout the company and our subsidiaries. In addition, we continue developing our internal control system and structures to secure proper business management in accordance with the Companies Act and the Ordinance on Enforcement of the Companies Act, and conduct proper and effective business in all Alpine Group companies. Please read “Internal Control System” in our Corporate Governance Report for more detail on the structures of our internal control system.
Alps Group Internal Control Structure
Board of Directors & Board of Directors Meeting
The Alpine Board of Directors, which is composed of 11 directors (excluding Audit and Supervisory Committee members) and 4 directors who are Audit and Supervisory Committee members (3 are external directors), discusses and makes decisions about important matters regarding the Alpine Basic Business Policy and Mid-term Business Plan, and audit and monitor the business performance. The Board of Directors makes decisions about all important matters through discussion at monthly meetings and extraordinary general meetings, which are held as necessary. In accordance with rules and bylaws governing the Board of the Directors, matters that require a resolution of the Board of the Directors are examined in advance for legal, accounting, tax and economic soundness to ensure compliance and rationality.
The articles of incorporation specify that directors shall be elected and removed by resolution passed at a General Shareholders Meeting by a majority vote of shareholders who are in attendance and whose number holds one third or more of the voting rights of shareholders entitled to the exercise thereof, and that cumulative voting shall not be employed.
Audit and Supervisory Committee
The majority of the Alpine Audit and Supervisory Committee members, including the chairperson, are external Audit and Supervisory Committee members, allowing the committee to make objective judgments while acting independently of the persons who execute the business. The external members, consisting of two lawyers, a certified public accountant, and a corporate executive (who joined in June of 2018), work with an internal member, who is a full-time employee familiar with the company’s business, to perform audits of the company’s operations with a high level of effectiveness. The Committee also provides advice to the company’s top management at meetings of the Board of Directors and other important meetings, in cooperation with the Internal Audit Division. Assistants for the Audit and Supervisory Committee shall be assigned, and their independence from the Board of Directors (excluding those who are the members of the Audit and Supervisory Committee) shall be secured.
Alpine has appointed four External Directors to enhance the functions of the Board of Directors. Each External Director focuses on ensuring legal compliance and strengthens supervisory functions over the company's operation through active dialogue and advice on the selection and dismissal of top management, remuneration, supervision on conflict of interest among the company, top management, and controlling shareholders, and other important matters at the Board of Directors meetings.
Alpine appoints external directors in accordance with its standards for the nomination of directors, including the Alpine Standards for Independence. In addition, we designate these individuals as independent corporate directors upon consent, and report such to the Tokyo Stock Exchange.
Evaluation of the Effectiveness of the Board of Directors
With the aim of improving the soundness, transparency, efficiency, and mobility of our execution of duties, Alpine is working to strengthen our corporate governance structure. As part of this effort, we have performed evaluations of the effectiveness of our Board of Directors, starting in fiscal year 2016. The summary of the evaluation results for fiscal year 2017 is as follows:
- Method for Analysis and Evaluation
Members of the Board of Directors each responded to a questionnaire with their name signed, evaluating and commenting on topics such as the composition of the Board of Directors, administration, items deliberated, communication among directors, and the support system. These results were analyzed by our Audit and Supervisory Committee (including external directors) and by administration directors. After the issues were organized, a report was given at the Board of Directors meeting, and we performed verification and held a discussion.
- Summary of Results of Analysis and Evaluation
The results revealed the sufficiency and rationality of the discussion, deliberation, and management in fiscal year 2017, ascertaining the effectiveness of our Board of Directors. However, issues have become prominent concerning the efficiency of the preparation procedure for the deliberations at the meetings of the Board of Directors, the diversity of members of the Board of Directors, the quality of the materials used in the Board of Directors’ meetings, and other aspects.
- Courses of Action and Other Plans for the Future
Based on the above results, we will conduct studies looking ahead to the management integration with Alps Electric Co., Ltd. planned for 2019. We will also share the opinions and evaluations of the Board of Directors in order to develop a more unified business attitude, and will utilize them both for the company’s governance and to create corporate value.