Corporate Governance

Basic policy of Corporate Governance

At GEESYS, reinforcing its corporate governance toward the improvement of its management transparency and its oversight function. In strengthening our corporate governance, our basic policies are to protect shareholder rights and ensure their equal treatment, cooperate appropriately with non-shareholder stakeholders, ensure proper information disclosure and transparency, execute the duties of the Board of Directors, and engage in dialogue with shareholders.

Our Principles

GEESYS corporate governance framework consists of the Board of Directors, which performs the functions of management supervision and making important decisions, and the Audit & Supervisory Board, which is in charge of the management audit function. As a company employing the corporate auditor system,GEESYS’s Audit & Supervisory Board suitably undertakes audits of the Company’s Directors and Executive Officers and guarantees objectivity and neutrality. The Company actively appoints Outside Officers that satisfy the requirements for Independent Directors / Audit & Supervisory Board Members, endeavors to strengthen management supervisory and auditing functions, and has established the Nomination and Remuneration Committee comprising a majority of Outside Officers as an advisory body to the Board of Directors.

Also, in order to clarify the roles of management and execution, we have introduced an executive officer system in an effort to clearly define the responsibilities of each business and streamline business execution. We are endeavoring to build an effective corporate governance framework with the use of the Executive Committee, which discusses and reports on important matters related to management as an advisory body to the president and chairman of the Board of Directors, as well as other committees tasked with planning and promoting key business strategy issues and key external issues, such as legal compliance

Nomination and Remuneration Committee

Established in fiscal 2019, the Nomination and Remuneration Committee enhances the Company’s corporate governance by reinforcing the fairness, transparency, and objectivity of procedures concerning the nomination and remuneration of Directors and Audit & Supervisory Board Members. The committee comprises at least three Directors as members, the majority of which are elected from among the Company’s Outside Directors. The chairperson is elected from among the Outside Directors that sit on the committee as members. The committee deliberates on the following matters and reports its findings to the Board of Directors.

  • Policy on the composition of the Board of Directors
  • Policies and criteria regarding the appointment or dismissal of Directors, the President and Chairman of the Board of　Directors, and Audit & Supervisory Board Members
  • Appointment or dismissal of Directors, the President and Chairman of the Board of Directors, and Audit & Supervisory Board Members
  • Matters regarding the formulation and implementation of a succession plan for the President and Chairman of the Board of Directors
  • Policies and criteria regarding the remuneration of Directors and Audit & Supervisory Board Members
  • Details of remuneration for Directors and Audit & Supervisory Board Members

Audit & Supervisory Board Members

GEESYS’s policy on nominating candidates for Directors and Audit & Supervisory Board Members is to decide on candidates by taking into account such factors as the overall balance of qualifications and experience on the Board of Directors, and other viewpoints like diversity. Directors are appointed for a single-year term so that their management responsibilities for each fiscal year can be clearly defined. This also creates a management structure capable of responding to changes in the operating environment.

Persons familiar with the Company’s operations in general who also possess expert knowledge and experience are appointed as Standing Audit & Supervisory Board Members. Persons equipped with the expert knowledge and experience required to undertake audits who also have an understanding of GEESYS’s management are appointed as Outside Audit & Supervisory Board Members. For instance, corporate managers, persons with experience as a standing auditor of a listed company, or legal experts.

Persons with the qualifications, experience, and other attributes required to execute the Company’s management policies are appointed as Standing Directors. Persons equipped with the insight and experience required to make multilateral business decisions who also have an understanding of GEESYS’s management are appointed as Outside Directors. For instance, managers of listed companies or experts in academic fields closely related to GEESYS’s business domains.

Independence Criteria for Outside Officers

The Company judges the applicable candidate to be fully independent from the Company when he/she does not fall under any of the conditions listed below in addition to criteria of independence stipulated by domestic financial exchanges

  • Major shareholder

    • A major shareholder of the Company (who owns 10% or more of the voting rights) or its executor of business.

  • Major business partner

    • A business partner (consultants such as lawyers, certified public accountants, and tax accountants, as well as consulting firms such as law firms, audit firms, and tax firms) or a person executing its business whose transactions with the Company exceed 2% of the annual consolidated net sales of the Company or the other entity in the past three fiscal years.

  • Major lender, etc.

    • A financial institution, other major creditor, or a person executing the business of these institutions that is indispensable for the Company’s funding and on which the Company depends to the extent that it is irreplaceable.

  • Accounting Auditor

    • A certified public accountant who belongs to an auditing firm that serves as the Accounting Auditor of the Company or employee, etc. of such auditing firm.

  • Donee

    • A person executing the business of an organization which receives a donation exceeding 10 million year per year that is greater than 2% of its annual income from the Company for the past three fiscal years.

Training Policy for Directors and Audit & Supervisory Board Members

Before taking office, Standing Officers undergo compliance training, which also encompasses legal and taxation matters. They are also provided opportunities after taking office to acquire necessary knowledge on an ongoing basis. Before taking office, Outside Officers are briefed on the state of the Company and the roles they are expected to perform. After taking office, they have the chance to deepen their understanding of the Company’s business by attending internal technology presentations and inspecting production sites.

Executive Remuneration

We have established a remuneration system and remuneration levels for GEESYS’s Directors and Audit & Supervisory Board Members that are deemed appropriate for their respective duties and in accordance with shareholder mandates, giving due consideration to the aims of securing and maintaining competent personnel and providing incentives for the improvement of business performance. We routinely verify that the system and levels are appropriate or whether they need reviewing in light of changes in the operating environment or objective external data.

Officer remuneration comprises mainly performance-linked remuneration and remuneration other than performance-linked　remuneration, but there is no policy in place for determining payment ratios. As for indicators pertaining to performance-linked　remuneration, the amount of performance-linked remuneration is determined mainly in line with the consolidated ratio of operating income to net sales—a key target in the Medium-Term Management Plan—and in light of consolidated Company earnings (operating income, net income, dividends, etc.) the previous fiscal year.

Evaluation of Effectiveness of the Board of Directors

The evaluation of the effectiveness of the Board of Directors was conducted with the use of a third-party survey for the first time in fiscal 2019 in order to verify whether the Board of Directors is properly fulfilling its expected roles and functions and to facilitate further improvements thereof. The results of the survey was reported to the Board of Directors and issues that require improvement going forward were shared with everyone.

Based on the results of this effectiveness evaluation, the Board of Directors will continue to work on enhancing its role by properly examining the issues that have been shared and addressing each one in turn according to a clearly defined schedule.

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GEESYS Technologies India Pvt. Ltd.
No.33A, Alandur Road, Saidapet, Chennai, Tamil Nadu, India 600015
+91 9962012354
geesyscare@geesysindia.com

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