1. Basic Approach to Corporate Governance
Topcon (hereinafter referred to as the “Company”) works to enhance management soundness, transparency, and efficiency based on TOPCON WAY and the TOPCON Global Code of Conduct, which set out the values, evaluation standards, and basic principles of conduct to be shared by the officers and employees of the Topcon Group (hereinafter referred to as the “Topcon Group”), comprising the Company and its subsidiaries.
The Company has also established internal control systems in accordance with the Companies Act. Through oversight by the Board of Directors, internal control, and compliance activities, the Company maintains a governance framework that supports the sustainable enhancement of corporate value.
2. Governance Structure
As a company with an Audit and Supervisory Committee, the Company separates management oversight by the Board of Directors from business execution by Executive Officers, thereby promoting timely and appropriate decision-making.
The Audit and Supervisory Committee, Accounting Auditor, internal audit department, and Nomination, Governance and Human Capital Committee work in coordination to enhance the effectiveness of the governance framework.
3. Group Governance
As a global company, the Topcon Group has established group-wide decision-making and control systems in accordance with the Topcon Group Governance Rules and other internal rules.
The Topcon Group also applies appropriate reporting and approval processes for material matters and monitors the management status of the entire group to enhance management soundness and effectiveness.
4. Compliance
Based on TOPCON WAY and the TOPCON Global Code of Conduct, the Topcon Group is committed to strict compliance with laws and regulations and to upholding high standards of corporate ethics.
The Topcon Group continuously develops internal rules, provides training, and conducts monitoring with respect to key compliance matters, including anti-corruption, competition law, export controls, respect for human rights, personal data protection, and information security.
In addition to compliance with laws and regulations and adherence to corporate ethics, the Topcon Group regards environmental and social issues as important management priorities. Please visit our Sustainability page for details of the sustainability initiatives.
5. Risk Management
The Topcon Group appropriately identifies and assesses risks associated with its business activities and works to mitigate and prevent them.
The Topcon Group continuously monitors key risks, including quality and safety, supply chains, information security, and legal and regulatory compliance, and maintains appropriate risk management systems across the group.
6. Audit and Supervisory Committee
The Audit and Supervisory Committee supports the Board of Directors in overseeing business execution and works to ensure management soundness through its oversight of the Corporate Auditing Department and the Accounting Auditor.
7. Audit Framework and Whistleblowing System
The Company has established the Corporate Auditing Department as its internal audit department, reporting directly to the Audit and Supervisory Committee and the Representative Director, President and CEO. The Corporate Auditing Department provides assurance on the appropriateness of business execution, internal controls, and internal management systems throughout the Topcon Group.
With the aim of contributing to the effective achievement of the Company’s management objectives and the enhancement of corporate value, the Corporate Auditing Department promptly reports any significant issues identified to the Audit and Supervisory Committee, the Representative Director, President and CEO, and the Board of Directors. The Corporate Auditing Department also works with compliance-related sections and the Accounting Auditor to facilitate the early detection, correction, and prevention of compliance-related issues.
To strengthen compliance management through the early detection of and prompt response to violations of laws and regulations and other misconduct, the Topcon Group operates a whistleblowing system with both internal and external reporting channels. The Topcon Group protects whistleblowers, prohibits retaliation, responds appropriately to reports, takes corrective action, and works to prevent recurrence.
8. Nomination, Governance and Human Capital Committee
The Company has established the Nomination, Governance and Human Capital Committee to deliberate matters concerning the appointment, dismissal, and compensation of Directors and Executive Officers. The Committee reports and makes recommendations to the Board of Directors, thereby contributing to greater transparency and objectivity in the management structure and compensation system.
