Corporate Governance
The DMC Board of Directors has responsibility for making business management decisions through active discussions and reinforcement of supervisory functions over the Company's management activities. The Board of Directors is composed of five Directors, and Board Meetings are held to address important matters regarding monthly management activities and to report the state of business execution.
DMC also holds Management Meetings with the participation of Directors, external advisors, and other appropriate individuals to reinforce prompt decision making, supervisory, and business execution functions. At Management Meetings, members thoroughly discuss basic measures regarding business, management policy, management plans and other important issues submitted by divisions and departments prior to Board Meetings, which enhances the optimization of decision making.
In addition, Group Company Meetings of USCO, the parent company of DMC, are held with the participation of top management of each group company to report the state of business performance of each group company, discuss and make decisions regarding business strategy and operation as USCO Group.
DMC Group audits are conducted by a part-time auditor and an external accountant to validate the adequacy of the financial information. Shareholder supervision rights are enhanced for supervision of the execution of business by the Board of Directors in accordance with laws and regulations. Shareholders have the right to request the convocation of a Board of Directors Meeting in the event that a director acts outside the scope of the purpose of the Board of Directors, and to express their opinions at the Board of Directors Meeting.
Compliance
With 40% of its total production taking place in global markets, compliance with both domestic and overseas laws, regulations and social norms is the top DMC priority in all business activities. DMC strives to ensure compliance throughout the organization. In FY2021, no serious violations of laws and regulations were reported.
DMC recognizes bribery and corruption as serious risk factors that have the potential to significantly damage the reputation of the company, and is committed to preventing illegal acts as well as scandals due to a lack of awareness.
In accordance with the Basic Policy on Gifts and Entertainment, DMC prohibits not only inappropriate compensation for public servants and representatives of private companies, including gifts, entertainment, and benefits, for the purpose of gaining or maintaining business, but also the promise, offer, or approval of such inappropriate compensation. DMC also established a system that specifies standards and approval processes for expenses regarding dining with business partners, and continues providing business partner management, education, and enlightenment activities for the executives and employees. Specifically, we require advance application for and detailed reporting after the use of customer-related entertainment expenses to prevent bribery and corruption. Any violation of these rules triggers the implementation of corrective measures and strict action against violators.
DMC Group has established an Internal Reporting Desk to enhance the prevention and early detection of violations against laws and regulations, and acts of dishonesty as well as to increase its reliability in society. DMC confirms the content of reports and consultations, takes corrective action and provides guidance. We also provide follow-up support to confirm that employees are not treated unfairly in order to provide appropriate protections. We received two reports and consultations in FY2021.
To establish a framework to accept reports and provide consultations for violations of compliance and harassment policy in business activities, we established Consultation Service Centers at Human Affairs & General Administration Departments at DMC and General Administration Departments at USCO.
At our Indonesia Factory, we have established a communication forum* and have developed our own reporting system based on the reporting process stipulated in our company regulations. In addition to serving as a whistleblower system, it is also used as a forum for communication among employees and with management.
* The Communication Forum is held monthly with 50 to 60 employee representatives coming together for a breakfast meeting (bread and drinks are provided). In addition to the head of the department in charge reporting on the current status of the company, other managers provide information that needs to be shared and a question-and-answer session is held.
DMC strives to increase employee awareness of compliance through seminars. In FY2021, outside lecturers were invited as part of the Sustainability training sessions with training on the important topic of compliance provided to managers of each department. At the Indonesia Factory, compliance is promoted through monthly DTI monthly reporting meetings to confirm that the compliance targets set by the Corporate Management System Division are being met.
DMC recognizes the importance of personal and other information received from our customers. In line with this, we have established a system to control such information and work to increase employee awareness and knowledge of the appropriate handling thereof to enhance the management system.
DMC has established“ Information Management Regulations” and“ Personal Information Protection and Management Regulations” for appropriate information management. We assign an Information System Manager and Personal Information Protection Manager in accordance with the regulations described above to ensure appropriate management and initiate measures for security. We also strive to increase employee awareness and knowledge of information management through in-house education. In addition, we dispose of media that contain information requiring the management specified by the above-mentioned regulations after physical destruction to prevent the risk of information leak. Thorough information management over subcontractors includes the requirement for recycling subcontractors to issue certificates of completion after data destruction.
We have been strengthening our networks, including security, in line with the longer duration and increase of people working from home during the pandemic. In fiscal 2021, we declared a one-star rating on the Security Action information security system conducted by the Informationtechnology Promotion Agency (IPA), a public institution of the Ministry of Economy, Trade and Industry, and carried out activities to raise awareness both inside and outside the company.
In addition, we enhanced information security by installing a fingerprint authentication system for entry to and exit from the Indonesia Factory to prevent unauthorized entry and information leakage.
Risk Management
DMC places a priority on risk management to accurately recognize risks that may have a significant influence on corporate value and business continuity, and strives to minimize damage by such risks.
Every year, each division manager clarifies both internal and external issues to identify and evaluate risks associated with such issues. Measures for risk assessment and effectiveness are appropriately managed through monitoring in accordance with the management plan and targets set for each risk. Top management assesses appropriateness, validity, and effectiveness quarterly and shares its assessment with each division manager to realize effective risk management. At the Indonesia Factory, we identify potential risks and report on the progress of measures to deal with the identified risks at a meeting attended by all divisions once a month in an effort to prevent the risks from materializing.
In response to the global spread of COVID-19, DMC strives to ensure infection control to protect the health of its employees and their families and to continue stable business activities.
In Japan, DMC takes preventive measures against COVID-19, including the wearing of masks, sanitizing, the implementation of remote work and flex-time systems, temperature checks when each employee arrives at the company in the morning, action history books, health surveys for guests, and a set response to infected individuals in accordance with guidelines provided by the government. In Indonesia, we implement thorough infection control in accordance with rules issued by the Ministry of Industry of Indonesia, and manage the health status of all employees using the Messenger app. Employees that commute to work use transportation provided by DMC in principle, and remote work is implemented when possible. We perform appropriate risk management in preparation for further spread of the infection using other approaches such as distributing health management flows for employees and their families when they feel sick.
DMC Group established a BCP in preparation for emergencies to ensure the safety of human life and the continuation of business activities. When a large disaster occurs, we must continue to provide supplies to customers, which we believe leads to the promotion of employment and vitalization of the local economy. We place a priority on business continuity to prevent disruption of our supply chain.
For emergencies, we have established an organizational structure headed by the president and subleaders assigned to perform external response, restoration, financial management and logistics support. This structure is capable of receiving top-down instructions and securing information management.
In FY2021, in response to the flooding disaster in Indonesia, we reaffirmed the importance of formulating and operating a BCP. As such, we are working to strengthen our supply chains, including decentralizing our suppliers and reviewing our purchasing routes, preparing comprehensive manuals that take into account earthquakes and fires at all of our factories.
We continue expanding the system of settlement, maintenance and revision of the BCP through periodical BCP education and training, and opinion exchange. We continue to improve our response to the BCP through opinion exchange with other companies and create effective business plans and structures for application in cooperation with our business partners, others in the industry and local communities.