Corporate governance

Corporate Governance Policy

Since our founding, Enplas Corporation has worked with customers around the world to contribute to develop a prosperous society by advancing the development of materials, process engineering, and evaluation technology, and by creating and mass-producing products previously thought impossible. The corporate philosophy, embodying management policy, corporate culture, and corporate ethics, clarifies the corporate mission of contributing to society and forms the basis of corporate governance. In accordance with the corporate philosophy and to create sustainable increases in corporate value, Enplas is enacting the corporate governance policy and will endeavor to ensure ongoing enhancement of corporate governance.

Corporate Governance Policy

Governance

Board of Directors
Ratio of independent outside directors: Four (4) independent outside directors / nine (9) directors (44.4%)

Skill Matrix
■Experience and skills related to effective supervision and governance
Global management: Enplas seeks directors who understand the financial, operational and strategic issues facing the company, have expertise in governance, strategy and execution, and have experience in global corporate management and international business management.
Sustainability: We seeks directors who has knowledge, experience and skills in non-financial factors that support our sustainable growth, in order to recognize material issues (risks and opportunities) for the future, including climate change, and to develop and implement long-term plans.
Finance and accounting: Enplas regard expertise in finance as emphasized. Our audit committee is required to have multiple directors with accounting and financial expertise.
Legal/ Risk management/ Governance: Enplas have to comply with various regulations in each region as a global company.
Therefore, we seek directors who owns experience in legal and risk management and expertise in governance.
Innovation/ Technology Development: Expertise and experience related to core technology with novelty is required to innovate constantly and explore market as pioneer by differentiate of technology.
And not only technology side, but also experience in forming basement of organization that develop new technology is expected.
Production/ SCM: Enplas seeks directors who owns expertise in manufacturing including supply chain, such as production technology, manufacturing technology and raw material procurement in creating and mass-producing products previously thought impossible.
Marketing/ Business Development: Enplas seek directors with business develop experience who have not only achieved further growth in existing technological fields, but have also found new market earlier than competitors, led the creation of markets from newly developed technologies, and put them on track.
Human Resource Strategy/ Corporate Culture: Enplas seek directors with experience of recruiting, training, retaining, creating management talent and cultivating corporate culture, in order to establish and realize human resource strategies based on our corporate culture and business strategy of “Pursuit of novelty”.

Establishing the Nomination and Compensation Advisory Committee
We’ve established a nomination and compensation advisory committee as a voluntary advisory body under the board of directors. This measure is intended to strengthen the independence, transparency, and objectivity of procedures related to decisions on nomination, remuneration, and other matters concerning directors and thereby strengthen our corporate governance.
Adopt transfer-restricted stock compensation as a long-term incentive
We’ve adopted a remuneration program based on shares with restrictions on transfers for Company directors (not including directors who are members of the audit committee and outside directors). This measure is an incentive intended to promote sustained growth in the Company’s corporate value and further sharing of value with shareholders.
Evaluation of effectiveness of the Board of Directors
Enplas conduct evaluation of effectiveness of the Board of Directors by questionnaires for enhancing its effectiveness annually. The Board of Directors aims to maintain and enhance its effectiveness by analyzing and evaluating the effectiveness of the board with being reported from the secretariat of the Board of Directors regarding the outcomes. In FY2021 and FY2022, we conducted the evaluation using internal questionnaires and FY2023 we conducted interview by third party organization.

Risk Management and Business Continuity Planning (BCP)

Risk management
In anticipation of natural disasters such as earthquakes, floods, and typhoons, the Enplas Group has in place a disaster response headquarters headed by the executive officer responsible for General Affairs, and identify the risks at each business site by creating a hazard map. Going forward, we will devise risk reduction measures for scenarios such as downed communications from cyber-attacks, transportation disruptions, pathogens, major power outages, and terrorism, and will also create hazard maps that cover customers, suppliers, partner companies, and other stakeholders. To address disaster risk, we have introduced distributed data storage as well as a safety confirmation system that includes suppliers as well as our own employees. In the supply chain, we practice multiple sourcing and also distribute partner companies geographically.

Business Continuity Planning and Management (BCP/BCM)
Since our founding, Enplas Corporation has worked with customers around the world to contribute to develop a prosperous society by advancing the development of materials, process engineering, and evaluation technology, and by creating and mass-producing products previously thought impossible. To continue growing sustainably, we are working to pass on skills to younger generations of employees and also accumulate and operationalize data by digitalizing it.

Fair and transparent transactions
Our Guiding Principles state: “The exchange of gifts and entertainment in the context of business must in no way deviate from the scope set by national laws and regulations or of societal norms. Actions that constitute bribery or other legal violations of law are strictly prohibited.” Our compliance mechanism requires employees and managers to report to or consult a LCO when they receive a request for exchange of gifts or entertainment from a national or local government official or from a staff member of a government-associated company.
Transactions with suppliers, meanwhile, must be carried out “fairly and appropriately in accordance with national laws and regulations, company rules, and business customs.” We carry out fact-finding audits to check for unfair dealings in relationships with suppliers with which we have done business continually for a certain period.
■Approach Towards Prevention of Bribery
① Enplas Group Code of Conduct and Guiding Principles state: “The exchange of gifts and entertainment in the context of business must in no way deviate from the scope set by national laws and regulations or of societal norms. Actions that constitute bribery or other legal violations of law are strictly prohibited.”
②Enplas Group operate whistleblowing system.
③We conduct a compliance inspection of all business sites once a year.
■Approach Towards Prevention of Corrupt Practices
① Enplas Group Code of Conduct and Guiding Principles state: “The exchange of gifts and entertainment in the context of business must in no way deviate from the scope set by national laws and regulations or of societal norms. Actions that constitute bribery or other legal violations of law are strictly prohibited.”
②Enplas Group operate whistleblowing system.
③We conduct a compliance inspection of all business sites once a year.

Security & Intellectual Property

Information security and cyber security
The Enplas Group has a Security Management Committee in charge of advancing the Group’s IT infrastructure and implementing cyber security measures. Our Information Management Regulations stipulate the handling of information and the routes of transmitting information in the event of an information leak. All Group employees undergo training on these rules. We take various steps to address risks related to the deliberate sending or taking of data outside the company, such as setting access permissions, data encryption, and email log analysis. We build our accounting and other important systems used globally to meet a set recovery time (RTO).

Handling of personal information
We include items on the handling of personal information in our information management rules and have also formulated and disclosed a privacy policy. All Group employees worldwide take a security training once a year.

Handling of intellectual property (IP)
The Enplas Group strives to increase the number of inventions created within the Group by establishing internal rules that stipulate the handling of inventions and the provision of incentives for inventors. Our inventions are appropriately protected by intellectual property rights, including patents, utility models, designs, and trade secrets. Information that should be kept secret is appropriately managed as confidential information. We strategically register and license inventions that are difficult to keep secret. We submit applications to acquire rights on IP, including patents, utility models, and designs, on a global basis. In fiscal year 2023, we own approximately 820 IP rights.
While we are not currently engaged in any disputes over IP rights, we do thorough research to ensure that our IP rights are not infringed and that we do not infringe the IP rights of other companies. Utilizing our network of patent and law firms in Japan, China and the US, we collect the latest information on global developments in IP, including in Europe.