Corporate Governance

Basic Philosophy

We consider the enhancement of corporate governance to be a critical issue for maintaining transparent, sound, and efficient management. While mindful of maintaining a fair management structure, we strive to further strengthen our governance system to remain a trusted company by fulfilling our accountability to our various stakeholders.

Details of Company Institutions and
the Status of Internal Control System Establishment

Details of Company Institutions

Board of Directors	The Board of Directors consists of 9 directors and makes decisions on important matters of the company while supervising the execution of directors' duties.
Audit & Supervisory Board System	We have adopted the Audit & Supervisory Board System. The three Audit & Supervisory Board Members (including one full-time member) audit the execution of duties by directors through attendance at Board of Directors meetings and other important meetings, as well as reviewing important documents. They also receive reports from the accounting auditor regarding accounting audits and examine their contents.
Executive Officer System	We have introduced an Executive Officer System to promote the separation and strengthening of the business execution function from the traditional Board of Directors, which is responsible for management decision-making and supervisory functions, thereby building a system that enhances management soundness and efficiency.
Full-Time Officers Meeting	We have established a Full-Time Officers Meeting consisting of full-time directors and executive officers to deliberate and report on important matters related to business execution. Full-time Audit & Supervisory Board Members also attend and express opinions as necessary to monitor important decision-making processes and the status of business execution.

Status of Internal Control System Establishment

The Board of Directors resolved on the Basic Policy for Internal Control Systems. Based on this policy, we established a Compliance Committee consisting of full-time directors and the presidents of consolidated subsidiaries. We establish and operate systems related to information retention management, risk management, compliance, and corporate group internal control execution to ensure appropriate business operations. We also established sub-organizations under the Compliance Committee, such as the Internal Audit Committee and Crisis Management Committee, to conduct internal control audits and business audits, as well as handle emergency situations and business continuity planning within the Risk Management System.

Execution of Internal Control

We execute this through a dual structure of internal audits and a Risk Management System. Internal audits include operational audits under the Companies Act, involving specialized consultants, and audits under J-SOX by accounting audit firms.

Compliance

Basic Philosophy

As we aim for urban development that brings happiness to people, cities, and society, we recognize the importance of conducting business with a strong commitment to legal compliance, ethics, and a sense of purpose. We view compliance as extending beyond mere legal adherence to encompass social norms and internal company regulations. To achieve this, we believe it is vital for every individual to possess a strong sense of social responsibility, respect the fundamental human rights of all Group employees and everyone involved in our business, and contribute to creating a comfortable work environment. We practice compliance-based management to ensure that we remain a trusted and reliable organization, capable of making sound judgments when facing various challenges.

Compliance Initiatives

In accordance with our Compliance Regulations and Detailed Ethics Rules for Officers and Employees, we implement the following initiatives to ensure appropriate, compliance-conscious behavior.

Establishment of Compliance Committee

We have established a Compliance Committee consisting of our directors, group company presidents, and designated appointees. Meeting regularly, the committee evaluates and improves the overall status of compliance operations, and maintains and implements regulations related to internal control systems.

Enhancement of Internal Reporting System

The Group has established internal (Compliance Dept.) and external (specialized agency) reporting and consultation hotlines available to all employees for reporting acts that violate laws, internal rules, or codes of conduct, including whistleblowing. We have also established a helpline exclusively for business partners to enhance external check-and-balance functions. We strive for the early detection and correction of misconduct and the fostering of a self-correcting corporate culture.

Anti-Social Verification & Anti-Corruption Measures

To ensure the exclusion of anti-social forces from business transactions, we have established a verification system and rules for confirmation. Regarding anti-bribery, we conduct employee education to prevent violations.

Issuance of Compliance Handbook

Implementation of Compliance Survey

We conduct an annual Group-wide survey regarding compliance in general, including harassment. We implement countermeasures based on year-over-year changes, assessments of actual conditions, and analyses, utilizing the results to maintain a comfortable work environment.

Implementation of Compliance Training

We regularly hold level-specific training for everyone from officers to general employees aimed at practicing compliance management, featuring themes incorporating the latest laws and social conditions. We strive to improve compliance knowledge and awareness through seminars with lawyers and experts, as well as online learning. In training for mid-career and new employees, the curriculum goes beyond basic legal compliance to broadly cover company regulations and corporate ethics.

Annual Basic Program

	New Graduate Hire	Mid-Career Hire
Compliance Handbook Distribution	〇	〇
New Employee Compliance Training	〇 (In-person as a rule)	〇 (In-person as a rule)

• △ indicates participation is limited to specific positions or responsibilities.
• In addition to the above, spot training is conducted as necessary. The target audience may be expanded (e.g., to include conflict of interest management in real estate investment).

Human Rights Policy

To realize a society where human rights are respected, Sankei Building employees comply with the Human Rights Policy established by Fuji Media Holdings.

Fuji Media Holdings
Group Human Rights Policy