Japan Petroleum Exploration Co., Ltd.
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Corporate Governance

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Basic Policy

JAPEX recognizes that the contribution to society through the stable energy supply is our mission and that addressing social issues toward realizing the sustainable development goals is the corporate vision.

In order to achieve the corporate vision and to maximize our corporate value in a medium- and long-term perspective, the efficient and transparent corporate management and the building of mutual trust relationships with our stakeholders including shareholders through ensuring our accountability are required, and corporate governance is one of our important challenges as our foundation.

We will enhance our corporate governance by respecting the purpose and spirit of Japan's Corporate Governance Code.

Outline of Corporate Governance

Organizational Structure Company with Audit & Supervisory Board
Executive Officer System Yes
Number of Directors provided for under Articles of Incorporation 18
Number of Directors 11
(including 4 Outside Directors)
Chairman of Board of Directors President
Number of Audit & Supervisory Board Members provided for under the Articles of Incorporation 4
Number of Audit and Supervisory Board Members 4
(including 2 Outside Audit & Supervisory Board Members)

Related

Corporate Governance Structure

Board of Directors and Executive Committee

The Board of Directors is regularly held once a month, and discusses and make decision concerning important business execution, the detail of which is provided by the decision-making standard of the Board of Directors, including launching new business, management strategy such as a basic plan of marketing and sales, and decision, revision, or repeal of the Mid-term Business Plan, as well as the exclusive prerogatives of the Board of Directors.

From the standpoint of accelerating the speed of decision-making, we compose the Executive Committee by the directors and other executives based at the headquarters to make decisions on the matters not involved by the decision-making standard of the Board of Directors and to make a discussion to assist the decision-making in the Board of Directors. The Executive Committee is held basically two times in each month, and extraordinary meeting is also held as needed.

And, Nomination and Compensation Advisory Committee is organized under the Board of Directors, in order to further enhance the supervisory function of the Board of Directors, by ensuring fairness, transparency, and objectivity of the procedures to make decisions concerning nomination and compensation of the director.

Audit & Supervisory Board and Audit & Supervisory Board Members

All Audit & Supervisory Board Members attend the Board of Directors as well as fulltime Audit & Supervisory Board Members attend the Executive Committee and other important management meetings to perform the function of management supervision by exchanging opinions as necessary with Directors and Executive Officers responsible for business execution.

The number of Audit & Supervisory Board Members is four, two of which are outside Audit & Supervisory Board Members. Each member exercises auditing authority independently based on the auditing policy and each responsibility between the members which are predetermined.

Internal Audits

Internal audits of JAPEX are conducted by Auditing Dept. under the direct management of the President. Auditing Dept. has been assigned five staffs to conduct internal audits, and they confirm whether the business operations of each department are carried out in accordance with the laws and internal regulations.

Internal audits are conducted following the annual plan in order, and Auditing Dept. reports the results of each audit to President and provides guidance and advice to the relevant business departments where necessary.

Accounting Auditor

The accounting auditor who conducts the audit of the financial statements and the internal control practices in the 51st fiscal year has been Ernst & Young Shin Nihon LLC, and the certified public accountants who conducted the audit were as follows:

  • Name: YUKAWA Yoshio, YAMAZAKI Kazuhiko, YOSHIDA Takeshi
  • Breakdown of assistants to the audit: 11 certified public accountants and 23 other assistants

Internal Committees

JAPEX has the risk management system with various internal committees. Risks in general management and each projects are evaluated and managed by the Management Risk Committee with a cross-sectional perspective, and deliberated by the expert committees to mitigate each risks.

For example, the Investment Evaluation Committee verifies risks and validity of important investments. The Risk Management Committee monitors the progress and formulates its countermeasures for the issues of each project which the investment decision was made.

The Sustainability Committee deliberates on matters related to the long-term vision, medium-term business plan, and ESG (Environmental, Social, and Governance) management including company-wide climate change measures, in order to make a sustainable growth over the medium to long term. In case to deliberate the risks of each business or project at the Sustainability Committee, the conclusions of deliberation in the Investment Committee and the Risk Management Committees are appropriately adopted and referred. Other important matters related to information security and occupational health and safety are discussed by the Information Security Committee and the HSSE Committee.

The results of deliberation and verification in the internal committees are reported to the Executive Committee and the Board of Directors as necessary for the deliberation of related matters.

Outline of the Limited Liability Agreement

JAPEX amended the articles of incorporation at the General Meeting of Shareholders as of June 2015, enacted the new article related to the limited liability agreement with Outside Directors and Outside Audit & Supervisory Board Members, and each Outside Directors and Outside Audit & Supervisory Board Members executed the agreement based on the above article. The outline of the limited liability agreement is as follows:

  • The limited liability agreement with Outside Directors: In the case where Outside Director(s) is(are) liable for damages which have arisen to JAPEX, given his/her performance of duties are made faithfully and without any gross negligence, he/she should be liable for damages to JAPEX within the limit of minimum amount as stipulated in Article 425-1 of the Companies Act and should be exempted from any liabilities beyond the minimum amount by JAPEX.
  • The limited liability agreement with Outside Audit & Supervisory Board Members: In the case where Outside Audit & Supervisory Board Member(s) is(are) liable for damages which have arisen to JAPEX, given his/her performance of duties are made faithfully and without any gross negligence, he/she should be liable for damages to JAPEX within the limit of minimum amount as stipulated in Article 425-1 of the Companies Act and should be exempted from any liabilities beyond the minimum amount by JAPEX.

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Corporate Governance System

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