Corporate Governance

Board of Directors

The Furukawa Electric Board of Directors is composed of 12 directors, including three Outside Directors. This is so as to receive advice and opinions from an outside perspective in Board of Directors meeting discussions and decisions. It helps to ensure transparency in decision-making, and strengthens the oversight function in management overall.

The Outside Directors bring their rich experience from the worlds of finance, trading, and corporations, and provide valuable advice and guidance from a variety of perspectives, and the Board takes these into serious consideration in making decisions. Therefore, we have created a system that enables Outside Directors and Outside Auditors to perform their duties smoothly, which includes doing our best to schedule our Board of Directors meetings so that our Outside Directors and Outside Auditors are able to attend, and also to provide them with detailed prior explanations so as to deepen their understanding sufficiently in regard to items of discussion.

The Compensation Committee, which includes Outside Directors, is charged by the Board with the policy on compensation of directors and the details of individual compensation, so as to maintain transparency in the decision process and eliminate arbitrariness.

Board of Corporate Auditors

Furukawa Electric has in place a Board of Auditors. We place great importance on the function performed by our Corporate Auditors and Board of Corporate Auditors, which are independent of the Board of Directors. We continue to make every effort to strengthen our audit functions through close collaboration between our Corporate Auditors, Accounting Auditors and the CSR Division, which acts as our internal auditing department, including sharing information and exchanging opinions.

Operational Performance

Our operational structure is based on a company system and a chief officer system. Under the supervision of the president, who is responsible for overall operational performance, operations are run by company presidents, and operations relating to matters such as Group-wide strategies, resource allocation and administration are handled by the relevant chief officer. Details are then reported back to the Board of Directors on a quarterly basis.

1)Efficient Execution of Responsibilities

After setting concrete management goals for the Medium-Term Management Plan and over the course of the fiscal year, the President, Company Presidents and Chief Officers execute their responsibilities toward achieving these goals and regularly report their progress to the Board of Directors.

2)Compliance System

Upholding the basic philosophy of compliance with ethics and prevailing laws as laid out in the Furukawa Electric Group Action Guidelines, we promote compliance activities including in-house education and efforts to prevent legal violations through our Compliance Committee, which is chaired by the President. We also have an Internal Reporting System for the early detection and correction of compliance violations.

3)Risk Management System

We have established a system in which the Risk Management Committee, composed of the President, Company Presidents and Chief Officers, conducts an overall review of the risks associated with the business operations of the Furukawa Electric Group and determines effective methods for evaluating and managing these risks.

4)Information Management System

We appropriately manage and store records and documents related to important decisions, in compliance with prevailing laws and internal rules. With respect to other information related to our operations, the Information Security Committee establishes uniform standards and operates an information management system.

5)Group Company Management

Based on rules for controlling Group management, we have assigned the supervision of Group Companies to Company Presidents and Chief Officers, who seek to understand the status of management at each company and provide appropriate guidance.