This document has been translated from the Japanese original for the convenience of non-Japanese shareholders. In the event of any discrepancy between this translation and the Japanese original, the original shall prevail.
Notice of the 110th Annual Shareholders' Meeting
(Items excluded from the paper-based documents to be delivered to shareholders who requested the delivery of paper-based documents, pursuant to laws and regulations and the Articles of Incorporation, among items for which the measures for providing information in electronic format are taken)
Matters relating to share options for the Company's shares Independent Auditor
Company systems and policies Consolidated Statement of Changes in Net Assets
Notes to Consolidated Financial Statements
Non-Consolidated Statement of Changes in Net Assets Notes to Non-Consolidated Financial Statements
(From April 1, 2024 to March 31, 2025)
NAGASE & CO., LTD.
The above items are excluded from the paper-based documents to be delivered to shareholders who requested the delivery of paper-based documents, pursuant to laws and regulations and the provision of Article 14, paragraph (2) of the Company's Articles of Incorporation.
Matters relating to share options for the Company's shares
Status of share options issued as consideration for the execution of duties and held by the Company officers as of the end of the fiscal year
No applicable information.
Status of share options issued to employees and others as consideration for the execution of duties during the fiscal year
No applicable information.
Other significant matters relating to share options No applicable information.
Independent Auditor
Name of Independent Auditor Ernst & Young ShinNihon LLC
Summary of liability limiting agreement
The Company has not entered into a liability limiting agreement specified in Article 423, paragraph (1) of the Companies Act with its Independent Auditor.
Amount of compensation paid to Independent Auditor during the current fiscal year
Amount of compensation (Millions of yen)
Amount of compensation, etc. paid by the Company to Independent Auditor in relation to business specified in Article 2, paragraph (1) of the Certified Public Accountants Act
118
Amount of compensation, etc. paid by the Company to Independent Auditor in relation to business other than that specified above
9
Total compensation, etc. paid by the Company and its consolidated subsidiaries to Independent Auditor
174
Notes: 1. The audit agreement between the Company and the Independent Auditor does not distinguish between audit compensation for audits performed pursuant to the Companies Act and audits performed pursuant to the Financial Instruments and Exchange Act and compensation cannot practically be categorized in this manner, and accordingly, the total amount is reported as compensation, etc. paid to the Independent Auditor during the current fiscal year.
2. The Audit & Supervisory Board received materials necessary for investigating the amount of the Independent Auditor's compensation from relevant internal divisions, Directors, Independent Auditor, and so on, received explanations from the Independent Auditor of a summary of the audit plan for the current fiscal year, audit times for each audit item, and so on, and based on the results of its confirmation of the audit plans for prior years and implementation of those plans determined that the compensation, etc. paid to the Independent Auditor is appropriate and gave its consent pursuant to Article 399, paragraph (1) of the Companies Act.
Details of duties other than audits
Non-audit services include agreed procedural work associated with tax filing in foreign countries.
Status of audits of financial statements of the Company's main subsidiaries by Certified Public Accountants or Audit Firms other than the Company's Independent Auditor
Of the Company's main subsidiaries, Prinova Group LLC, Nagase (Hong Kong) Ltd., Nagase (Thailand) Co., Ltd. and three other overseas subsidiaries were audited by certified public accountants or an audit firm (including persons with corresponding qualifications in a foreign country) other than the Company's Independent Auditor.
Policy on determination to dismiss or not to reappoint Independent Auditor
In addition to dismissal of the Independent Auditor by the Audit & Supervisory Board as specified in Article 340 of the Companies Act, if the Company determines that it would be difficult for the Independent Auditor to properly perform its duties because of a violation of laws and regulations by the Independent Auditor, the occurrence of events that impair the Independent Auditor's qualifications or independence, and so on or if the Company determines that changing the Independent Auditor would be suitable for enhancing the appropriateness of audits, the Company's policy is to propose at a Shareholders' Meeting to dismiss or not to reappoint the Independent Auditor.
Company systems and policies
Systems for ensuring the proper implementation of business and status of operation of those systems Summary of resolution on systems for ensuring the proper implementation of business (internal control systems)
The Company's Board of Directors adopted a resolution on basic policy for creating internal control systems entitled "Creation of Systems to Ensure that Directors Execute their Duties in Accordance with Laws and Regulations and the Articles of Incorporation and Other Systems Specified by Ministry of Justice Ordinance Necessary for Ensuring the Proper Implementation of Business by a Stock Corporation and the Corporate Group Comprising that Corporation and its Subsidiaries." Details of the policy are set forth below. Based on this basic policy, the Company will ensure the appropriateness of its business operations and conduct ongoing reviews and continuous improvement in order to appropriately reinforce governance systems even further in light of changes in the Company's business environment.
The Company has established the Internal Control Committee to build, maintain and improve the internal control system. The Committee deliberates on basic policies for the internal control systems, builds systems established under the internal control systems, and monitors the operation of the systems.
Systems to ensure that Directors and employees execute their duties in accordance with laws and regulations and the Articles of Incorporation (Article 362, paragraph (4), item (6) of the Companies Act and Article 100, paragraph (1), item (4) of the Regulations for Enforcement of the Companies Act)
Based on management philosophy of "recognizing our responsibility to society while maintaining the highest standards of integrity," the Company has established the Code of Conduct for Risk Management & Compliance, and has created systems for ensuring that all officers and employees including those of Group companies conduct corporate activities in accordance with the Code of Conduct for Risk Management & Compliance in order to create and maintain compliance systems.
The Company has established Risk Management & Compliance Committee and the Committee is made up of Directors and employees. The members make all determinations relating to risk management and compliance. When necessary, the Committee engages outside experts and works to prevent violations of laws and regulations and the Articles of Incorporation.
The Company has formulated internal rules on individual issues, and makes decisions through multidirectional examination on compliance and other important points from a professional perspective.
Should employees of Nagase or its Group companies become aware of legal or other compliance issue, they immediately report to and consult with their supervisor or the relevant division and then report to the Risk Management & Compliance Committee, which promptly reports to the Board of Directors and the Audit & Supervisory Board and its members. In addition, the Risk Management & Compliance Committee has introduced an internal reporting system wherein employees and officers including those of Group companies can report or discuss issues directly. The aim is to prevent violations of laws and regulations and the Articles of Incorporation by Directors and employees in the performance of their duties, and to prevent such violations from being left unattended or unaddressed.
Awareness regarding legal compliance among officers and employees including those of Group companies is raised by conducting courses taught by outside experts and through other means. And efforts are made to disseminate information regarding the management philosophy by the Committee.
Our Audit Office conducts internal audits relating to the status of execution of duties by Directors and employees in accordance with the Internal Audit Rules.
Systems for retaining and managing information relating to the execution of duties by Directors (Article 100, paragraph (1), item (1) of the Regulations for Enforcement of the Companies Act)
Information relating to the execution of duties by Directors is recorded on paper or electromagnetically in accordance with internal rules and is retained and managed. Directors and Audit & Supervisory Board members can access and view these documents at any time.
Rules relating to management of loss-related risks and other systems (Article 100, paragraph (1), item (2) of the Regulations for Enforcement of the Companies Act)
The Company has established the Risk Management & Compliance Committee as the organization that performs comprehensive management relating to loss-related risks for the Company and Group companies, determined the committee's functions and authority, and created a system that clarifies its roles and responsibilities.
Each responsible division establishes rules and guidelines, conducts training, prepares and distributes manuals, and takes other measures concerning individual risks relating to the business activities of the Company and Group companies.
When new risks arise, the Risk Management & Compliance Committee promptly designates the responsible division to address the risks, and also develops a system for prompt and appropriate communication and emergency procedures in case that an incident occurs within the Group.
Systems for ensuring the efficient execution of duties by Directors (Article 100, paragraph (1), item
(3) of the Regulations for Enforcement of the Companies Act)
The Board of Directors is clearly positioned as the body in charge of making decisions on management policies and strategies, and it supervises the execution of operations. The Board of Directors holds regular monthly meetings as well as extraordinary meetings when necessary.
The Group Management Committee, consisting of executive officers appointed by the Board of Directors, has been established to discuss important matters such as management strategies and investment projects, as a way to support management decision-making, and holds regular meetings once a month in principle. Directors and Audit & Supervisory Board Members may attend the Group Management Committee meetings.
With regard to the performance of business in accordance with the decisions of the Board of Directors, organizational operations rules and divisions of work responsibilities established under an executive officer system specify responsible parties, their responsibilities, and procedures for carrying out those responsibilities.
Systems for ensuring the proper implementation of business by the corporate group comprising a stock corporation and its subsidiaries (Article 100, paragraph (1), item (5) of the Regulations for Enforcement of the Companies Act)
Systems for reporting to the Company on matters pertaining to the execution of duties by directors, etc. of subsidiaries (Article 100, paragraph (1), item (5)(a) of the Regulations for Enforcement of the Companies Act)
The Company has established operational standards and established a system that requires
approval from or reporting to the Company after Group companies make decisions on certain matters.