Corporate Governance

Assessment of the Effectiveness of the Board of Directors

Assessment of the Effectiveness of the Board of Directors

Assessment Methods

Based on the results of questionnaires sent out to all Directors and Audit & Supervisory Board embers in November 2020, the Board of Directors met on three occasions to assess the effectiveness of its operations, thereby identifying issues to be tackled and initiatives to be implemented going forward.
The questionnaires used in this round were designed to confirm conformity with Japan’s Corporate Governance Code while incorporating items aimed at qualitative improvement. We employed the advice of an expert organization to determine the content of these items and analyze input from respondents.

Process for the Assessment of the Board of Directors’ Effectiveness
Figure
Assessment results: Overall functions of the Board of Directors were confirmed.
Issues identified and future initiatives

Based on results of the assessment of its effectiveness, the Board of Directors deliberated on its mode of operations and reconfirmed that it will continuously strive to contribute to further improvement in corporate value. Specifically, the Board of Directors will address medium- to long-term important issues related to management strategies with the greater involvement of Outside Directors to facilitate the exchange of frank opinions and in-depth discussion, with the aim of improving the quality of its future decision making. To this end, it will tackle the following issues.

  1. Review of agenda ite

    The Board of Directors will determine priorities among agenda items identified via the assessment of its effectiveness and deliberate on them accordingly.

  2. Enhancement of opportunities for Outside Directors to step up their involvement in discussion and acquire necessary information, etc.

    Utilizing Outside Director meetings and other sessions, we will create greater opportunities for Outside Directors to engage in information exchange toward the revision of the Medium-term Management Plan and discussion with business departments. At the same time, we will enhance the content of information and other input offered to them to support their judgments.

  3. Invigoration of discussions via improvement in the Board of Directors’ mode of operations

    When Directors and Audit & Supervisory Board Members are sufficiently briefed on agenda items to be submitted to the Board of Directors, on-the-day explanations of these agenda items will be simplified. In these and other ways, we will improve the Board of Directors’ mode of operations and enable it to better focus on and secure greater time for discussion aimed at improving corporate value.

  4. Enhancement of the content of discussion regarding the nomination of and compensation for Executives

    The Nomination and Compensation Advisory Committee began to share important points of its discussion with the Board of Directors in addition to continuing to report its conclusions so that matters related to the nomination of and compensation for Executives are sufficiently discussed by the Board of Directors.

出光興産, DFF Inc.