Corporate Governance

Basic Policy

At Nippon Shinyaku, we recognize that it is a critical management priority to fulfill our accountability to all stakeholders, by securing the transparency of management in order to raise our corporate value through social contributions. This makes it essential for our corporate governance to function effectively, and we are committed to further expanding the framework for internal control, compliance, and risk management.

The Company shall,

  • (1) Respect the rights of shareholders and ensure the equality
  • (2) Have a responsibility to all stakeholders including shareholders and cooperate the stakeholders appropriately.
  • (3) Disclose Company information timely and properly, and ensure transparency and equality of decision-making.
  • (4) Make effective use of management resources and augment management activities by prompt and resolute decision-making.

Additionally, on December 15, 2015, the Company laid down the Corporate Governance Basic Policy, which defines its basic principles and policies on corporate governance. The Policy was revised on June 29, 2022.

Overview of Framework for Corporate Governance

The Company is a Company with Auditors which consists of 12 Directors including 4 external directors and 4 Auditor & Supervisory Board Members (Corporate Auditors) including 2 outside auditors.
To clarify the management responsibility and establish the optimal management system against changes of management circumstances agilely, the Company requires the Directors to serve one-year term.
The Company appoints 4 external Directors to further strengthen oversight of company operations by the Directors and strive to further progress the management transparency and objectivity. The Company adopted an auditor system in which Auditor & Supervisory Board Members shall attend all Board meetings and critical meetings on business. The Company ensures the independence of 2 outside auditors from the Company and the management oversight function by Audit & Supervisory Board.

Overview of Framework for Corporate Governance

Board of Directors Audit & Supervisory Board Nominating Committee and Remuneration Committee
Attendees
All Directors and Audit & Supervisory Board Members
All Audit & Supervisory Board Members
  • Shigenobu Maekawa
    (Representative Director, Chairman)
  • Miyuki Sakurai (Outside Director)
  • Yoshinao Wada (Outside Director)
Role
  • Performing the oversight function for management in general and ensuring fairness and transparency of management
  • Determining policies governing the appointment and dismissal of Directors and Audit & Supervisory Board Members
  • Evaluating serious risks and formulating countermeasures
  • Making decisions, such as the execution of important business operations
  • Playing a role in corporate oversight in coordination with the Board of Directors
  • Supervising the execution of duties by the Board of Directors and working to establish the corporate governance system
  • Actively expressing opinions based on their own specialized knowledge and vast experience
Nominating Committee
Deliberating on matters related to the appointment and dismissal of Directors and Audit & Supervisory Board Members and reporting to the Board of Directors
Remuneration Committee
Deliberating on proposals for the General Meeting of Shareholders related to remuneration of Directors and Audit & Supervisory Board Members and basic policies governing remuneration for Directors, and reporting to the Board of Directors
Deliberating and making decisions on the details of remuneration for individual Directors based on the responsibility delegated by the Board of Directors
Meetings
held in
FY2022
15
(12 regular meetings,
3 extraordinary meetings)
18 3
(Nominating Committee: 1;
Remuneration Committee: 2)
  • Inside Directors
  • Outside Directors
  • Standing Audit & Supervisory Board Members
  • Outside Audit & Supervisory Board Members
  • Chairperson

Related materials

Criteria for Judgment of Independence

Outside executives (External Directors and External Auditors) and other candidates that do not come under any of the following categories shall be considered by the Company to have an adequate degree of independence.

  • (1) Current or past executives of the Company (including subsidiaries; likewise hereafter)
  • (2) Major transaction partners of the Company, or their executives
  • (3) Parties for which the Company is a major transaction partner, or their executives
  • (4) Consultants, accountancy specialists or legal experts (in the case of corporations, associations and other groups, those who belong to such groups) who receive large sums of money or other assets from the Company in forms other than executive remuneration
  • (5) Major shareholders of the Company or their executives
  • (6) Parties who receive significant monetary donations from the Company (in the case of corporations, associations and other groups, executives of such groups)
  • (7) Any close relative(s) of those specified in (1) to (6) who is a significant party
  • * Notes
  • (1) - (6) “Executives” above refers to Executive Directors, Corporate Officers or any other individuals or employees with equivalent status
  • (2) “Major transaction partners of the Company” refers to any transaction partner who has accounted for more than 2% of consolidated sales of the Company by transaction amount over the most recent business year
  • (3) “Parties for which the Company is a major transaction partner” refers to any transaction partner for which the Company is deemed important; that is, the Company has accounted for more than 2% of consolidated sales of such partner by transaction amount over the most recent business year
  • (4) and (6) “Large sums” refers to sums in excess of ¥10 million or exceeding 2% of consolidated sales or total revenues of the party in question
  • (5) “Major shareholders of the Company” means shareholders holding at least 10% of the total voting rights
  • (7) “Significant party” means executives of general manager grade or higher, and “close relative(s)” refers to spouse or family members in second degree

Evaluation of effectiveness of the Board of Directors

Results of fiscal 2022 evaluation

As previously, the survey confirmed that all Board members believe that meetings provide the opportunity to actively voice opinions; to engage in free, constructive debate based on multi-faceted, wide-ranging perspectives; and that the discussions support appropriate management decisions. This result indicates the Board of Directors is broadly effective.

Response to the Corporate Governance Code

Conforming to the objectives and spirit of the Corporate Governance Code established by the Tokyo Stock Exchange (TSE) in June 2015, Nippon Shinyaku reexamined the status of its activities with regard to the General Principles of the Corporate Governance Code so as to ensure sustainable growth and medium- to long-term enhancement of its corporate value. In its Corporate Governance Report published in January 2024, Nippon Shinyaku implemented “Disclosure Based on the Principles of the Corporate Governance Code,” also disclosing “Reasons for Non-compliance with the Principles of the Corporate Governance Code.”

Officers’ Remuneration

Total sum of remuneration for each officer category, subtotals of types of remuneration, and the number of recipient officers (FY 2022)

Officer category Total sum
(millions of yen)
Subtotal by type (millions of yen) Number of recipient officers
Basic fixed remuneration Performance-linked remuneration
Directors (excluding external directors) 437 215 223 8
Auditors (excluding external auditors) 34 34 - 2
External directors & external auditors 60 60 - 6

Officers’ remuneration, the sum and calculation method, and how they are determined

In Nippon Shinyaku’s policy on officers’ remuneration, the sum and calculation method are determined on the basis of each officer’s grade and performance. The monthly salary is composed of a fixed part based on the grade and a part based on performance appraisal. Bonuses (offered to executive directors only) are performance-linked and set by multiplying the company’s annual operating income by a fixed percentage attributed to each officer grade.

Dialogue with Shareholders

To ensure sustainable growth and enhance medium- to long-term corporate value, Nippon Shinyaku actively engages in constructive dialogue with its shareholders. Such dialogue is followed up with the company’s efforts to develop and improve internal systems for reliable information disclosure and mechanisms that incorporate learnings from dialogue with shareholders into company management.

In FY2022, in addition to financial results briefings and conference calls, Nippon Shinyaku held a two-part R&D briefing for shareholders and investors. In the first part, a medical specialist explained the treatment of Dravet syndrome and future prospects in relation to Fintepla, a treatment for seizures associated with Dravet syndrome that was launched in Japan in November 2022. In the second part, presentations were made on the progress of the nucleic acid drug pipeline, as well as initiatives for new modalities of next-generation antisense nucleic acids, gene therapy, and cell therapy, which are attracting a great deal of attention. In addition, President Nakai has been attending financial results briefings, shareholder and investor meetings, overseas IR events and large meetings, and will continue to regularly interact with shareholders and investors to explain the Company’s growth strategies in the short, medium, and long term.

Cross-shareholdings and the basic policy on the exercise of voting rights related to cross-shareholdings

  • Nippon Shinyaku decides for or against cross-shareholdings in view of the importance of forming or maintaining transactions with concerned parties, the reinforcement of business partnership and other operating alliances, and the rationality of cross-shareholdings in terms of risks and returns.
  • With regard to major cross-held shares, Nippon Shinyaku’s Board of Directors periodically checks the rationality of their purposes and economic efficiency at its meetings.
  • Nippon Shinyaku responsibly exercises its voting rights associated with cross-held shares by examining whether or not the motions in question contribute to the enhancement of Nippon Shinyaku’s and the issuing company’s corporate value.

Succession Plan

Succession Plan

Nippon Shinyaku recognizes that it is important to train successors from various perspectives based on the future vision of the Company. We run HONKI Juku selective training programs which are classified into Leader, Management, and Executive according to the position and number of years at the Company of trainees.
The Leader program targets the younger group from age 25 to 35 to quickly uncover and pick out leader candidates. The Management program provides lectures on management basics and middle management for executives from age 36 to 45 to acquire the perspective of a department manager. The Executive program aims for acquisition of practical management knowledge to train the next generation of management candidates. Through these efforts, we constantly secure motivated and outstanding human resources, striving to develop and acquire the human resources to lead the Company in the future.

Training for Officers

Nippon Shinyaku holds training and debriefing sessions attended by all Directors, in order to convey information that is essential for Directors on legal responsibilities, corporate governance, etc., and to share information on the important operations performed by each division. Audit & Supervisory Board Members can also attend these sessions. New Directors and new Audit & Supervisory Board Members receive new officer training offered internally upon their assumption of office. In this manner, Nippon Shinyaku provides the necessary training opportunities for Directors and Audit & Supervisory Board Members, covering any expenses incurred.

Basic Policy on Internal Control System

The Company is striving to act with higher ethical sense, putting human dignity first and taking consistently into consideration of social contribution. The Company recognizes the aforementioned is involved closely to the progress of corporate value. Internal control system is a measure to achieve it and shall be practiced by all the people who comprise a business organizer. The reliability of financial reporting shall be ensured based on compliance with law and enhancement of effectiveness and efficacy in business. The Company thinks that internal control system shall provide the rational assurance, aiming at its goal to ensure the above reliability.

Skills Matrix

  • Shigenobu Maekawa
  • Toru Nakai
  • Shouzou Sano
  • Takashi Takaya
  • Takanori Edamitsu
  • Kazuchika Takagaki
  • Hitoshi Ishizawa
  • Hitomi Kimura
  • Miyuki Sakurai
  • Yoshinao Wada
  • Yukari Kobayashi
  • Mayumi Nishi
  • Hirotsugu Ito
  • Eriko Doi
  • Hiroharu Hara
  • Mariko Chaki
Category Name Skills and experience
Category Name Skills and experience
Corporate
management/
Management
strategy
Global
business
Finance/
Accounting
Legal affairs/
Risk
management
Research &
Development
Sales/
Marketing
Production/
Quality
Personnel/
HR
development
ESG/
Social
contribution
IT/
Information
management
Director
(Inside)
Shigenobu
Maekawa
Toru Nakai
Shouzou
Sano
Takashi
Takaya
Takanori
Edamitsu
Kazuchika
Takagaki
Hitoshi
Ishizawa
Hitomi
Kimura
Director
(External)
Miyuki
Sakurai
Yoshinao
Wada
Yukari
Kobayashi
Mayumi
Nishi
Corporate
Auditor
(Inside)
Hirotsugu
Ito
Eriko
Doi
Corporate
Auditor
(External)
Hiroharu
Hara
Mariko
Chaki
  • (Note) The above list does not represent all of the expertise and experience Directors and Corporate Auditors have.

ESG Management