DyDo Group Holdings

Ongoing Improvements to Corporate Governance

  • 2014
  • 2016
  • 2017
  • 2018
  • 2019
  • 2020
  • 2021
  • President
    • 2014: Appointment of Tomiya Takamatsu as president
  • Group
    structure
    • 2017: Transition to holding company structure
    • 2020: Formation of a Group ESG Committee
  • Revitalizing
    the Board
    of
    Directors
    and
    strengthening
    its functions
    • 2016: Review of the scope of authority
      2017: Transffer of authority to group companies
    • The number of members on the Board of Directors as determined in the Artickes of Inc corporation to 9 to fewer
      2016: The number of members on the Board of Directors as determined in the Artickes of Inc corporation to 7 to fewer
    • 2019: Formation of an Advisory Board
  • Improving
    the
    effectiveness
    of the
    Board of
    Directors
    • 2017: Introduction of a performance-based incentive program
      2021:Formation of a Nominating and Compensation Committee
    • 2016: Evaluation of the effectiveness of the Board of Directors
    • 2017: Disclosure of a summary of the evaluation results
  • Outside
    directors
    (the number of people)
    • 2014: Apppintment of two outside directors
    • 2016 : two of six
      2021: three of seven*
  • Outside
    directors
    (ratio)
    • 2016: one-third
      2021: 42.9%*
  • Company
    philosophy
    • 2014: Enactment of a new group philosophy,vision,and slogan
    • 2016: Enactment of a corporate governance basic policy
    • 2019:Enactment of a Group Code of Conduct
*Due to the resignation of one director, the number of outside directors is three of six (account for 50%) as of June 15, 2021.

1. Evaluation of Effectiveness of Board of Directors

At DyDo, we have been evaluating the effectiveness of the board of directors since FY2016.

Method of analysis and evaluation

In order to analyze and evaluate the effectiveness of the Board of Directors, during the period between December 2020 and February 2021, all directors and auditors carried out a self-evaluation survey, and individual interviews were carried out by the Secretariat of the Board of Directors.
After that, at a meeting of the Board of Directors that was held on March 4 2021, in addition to analyzing the results of the self-evaluation surveys, and in an attempt to enhance awareness regarding present problems, constructive discussions were held regarding these matters and future efforts to realize a higher level of effectiveness for the Board of Directors.

Evaluation items

The self-evaluation survey form included items addressing the following major topics so that respondents could review the effectiveness with which the Board of Directors deliberated and dealt with issues identified through the evaluation of its effectiveness during the previous year:

  • (1)

    Board agenda and operations

  • (2)

    Status of discussions of medium- and long-term issues in light of Group Mission 2030

  • (3)

    Other (issues related to the strengthening of governance structures, etc.)

Overview of Analysis/Evaluation Results

On the basis of the outcome of discussions regarding the analysis of the results of the self-evaluation surveys,the Board of Directors of the company came to the conclusion that “the Board of Directors is functioning effectively.”

[Improvements in Board of Directors operations during FY2020]

The Board of Directors sought to improve materials provided to directors in a number of ways, for example by including supplemental explanations of progress in important KPIs in our Domestic Beverage Business, which is one of the Group’s core businesses, and of points of discussion at the Management Committee and other bodies. It also worked to expand availability of information that contributes to ongoing monitoring of our approach to key management issues, for example by creating regular opportunities for reporting on progress in implementing our human resources strategy, and it held a series of discussions on criteria for exiting certain businesses.
With regard to deliberation of important matters, the Board sought to stimulate discussions, for example by convening meetings to facilitate the exchange of views in advance of Board meetings so that outside directors and auditors can better communicate with the directors who oversee the company’s operations.
With regard to discussions related to more highly specialized business domains, directors affirmed the need to provide sufficient and thorough explanations in advance of meetings and to appoint outside executives with extensive experience and expertise in specialized domains in the future.

Challenges for the Future
  • (1)

    We need to create new opportunities for communication and further deepen discussions on the nature of the company’s business portfolio and on the direction of its investment strategy as we prepare to formulate the next mid-term business plan.

  • (2)

    We need to ensure appropriate oversight of the status of initiatives related to the hiring, retention, and training of human resources with the skills necessary to implement the succession plan that will orchestrate the transition to a new generation of executive leadership and the company’s international business strategy.

  • (3)

    In addition to working to strengthen management and auditing structures to accommodate the expansion of our international businesses, we need to develop more sophisticated management techniques, for example by establishing KPIs that accommodate growth in our business domains.

  • (4)

    With regard to the composition of the Board of Directors over the medium and long term, we need to continue to study how to appoint even more diverse human resources in response to progress in our management strategy and changes in society.

2. Nominating and Compensation Committee

Nominating and Compensation Committee, which is being established to strengthen the independence, objectivity, and accountability with which the Board carries out its functions by empowering it to involve, and obtain advice from, independent outside directors in an appropriate manner, particularly when considering important matters such as the nomination and compensation of top management and directors.

3. Advisory Board

The Advisory Board, which consists of roughlythree outside experts not currently serving as outside directors or external auditors, embodies a voluntary mechanismby the Company to further enhance its corporate governance. It meets from time to time as necessary to offer the president assessments and advice from an objective perspective concerning issues that demand a high level ofspecialized knowledge, for example investment decisions related to the orphan drug business, and to further boost the transparency of the Company’s management by incorporating outside perspectives into the execution of strategy, for example by offering advice concerning management issues faced by the Group.

4. Group ESG Committee

TheGroup ESG Committee, which is chaired by the president, consists of members appointed by its chairperson. It meets twice a year, and at other times as necessary, to increase the value of the Group’s corporate brand by considering and approving the Group’soverall ESG management policy, by adopting the companywide ESG program, and by issuing instructions for improvements.

ormation of an Advisory Board

5. Establishing an Internal Reporting Liaison Independent from Management

We have established an internal reporting liaison called the "DyDo Compliance Hotline," and we are working to ensure awareness about it among group employees.
If there is a violation of laws, regulations, in-house rules, or social norms, or a risk of such a violation, we ensure that the employees of our group (employees, temporary workers based on the Worker Dispatch Act, and part-timers) and employees of business partners of our group, can directly communicate that information without fear of negative repercussions. In addition to our internal risk management department, we have set up an outside law office as a liaison since January 2017, thus enabling actions such as reporting to either an internal or external contact.