- Corporate Governance
- Foundation of Pioneer's Decisions and Actions
- Internal Control System and Risk Management
- Full Compliance and the Internal Whistleblowing System
- Crisis Control Measures
- Policy Regarding Material Suppliers
- Appropriate Disclosure of Management Information
- Security Export Control
- Ensuring Fair Trade
- Exclusion of Antisocial Forces
- Protection of Intellectual Property and Copyrights
- Information Security and Protection of Personal Information
Under the Companies Act of Japan, Pioneer has elected to structure its corporate governance system with a Board of Corporate Auditors. The Board of Directors decides on fundamental issues such as management policies and supervises the execution of business activities, while the Board of Corporate Auditors audits the directors' performance of their duties. Based on this institutional structure, Pioneer has adopted an executive officer system to expedite the execution of business activities.
Aimed at improving corporate governance, a new structure was established in June 2012 to enable the directors, with their number reduced from 10 to seven, to specialize in decision-making and supervisory functions from a Group-wide perspective and the executive officers to enhance their executing functions.
Meanwhile, aiming to enhance the transparency of decisionmaking, Pioneer has established a Group Executive Committee and voluntary advisory committees to the Board of Directors.
Please check Investor Relations/Corporate Governance for details
Foundation of Pioneer’s Decisions and Actions
The Pioneer Group will consistently take note of changes in society as it continues to provide products and services. To fulfill its social responsibilities, the Group intends to gain an understanding of society's expectations through dialog with various stakeholders including shareholders, consumers and customers, local communities, business partners and employees.
Of foremost importance is the Pioneer Group Charter for Corporate Operations, which aims to ensure that the Group will remain trusted and respected by society as a good corporate citizen. In addition, the Pioneer Group Code of Conduct has been established to outline basic decision-making and behavioral standards for Group directors, officers, and employees.
Each Group company ensures that every officer and employee follows this code while observing the laws and social conventions of their respective countries and regions.
Internal Control System and Risk Management
The Pioneer Group continues to upgrade, expand, and bolster its internal control system in an effort to prevent risk and address crisis situations. In this manner, the Group is endeavoring to enhance the integrity of its management.
In addition, the Group has put in place and is augmenting its Rules of the Pioneer Group. By further ensuring that all members of the Group are fully informed of these Rules, the Pioneer Group is taking steps to secure the adequacy and optimal efficiency of business activity execution.
With the Pioneer Group Charter for Corporate Operations positioned as its foremost component, the Rules of the Pioneer Group also consist of the Pioneer Group Code of Conduct as well as specific rules outlining the scope of responsibility and authority for each Group company and guidelines relating to compliance.
Chaired by a representative director, Pioneer's Internal Control Committee was established in accordance with the Basic Rules for Internal Control System. In addition to consolidating and reinforcing those management systems aimed at addressing risks inherent in the Group's business activities, this Committee is working to gain a better understanding of the nature and scope of business risks and to formulate effective crisis management countermeasures.
The Company manages important risks in a systematic manner in line with policies identified in the Rules of the Pioneer Group. As the organization that oversees these rules, a designated department located within the Company's headquarters is responsible for enhancing their acceptance and understanding by the Group as a whole.
The Audit Division, under the direct control of the president, takes overall charge of implementing internal auditing throughout the Group as a whole, based on the Basic Rules for Consolidated Internal Audit, which are part of the Rules of the Pioneer Group. Collaborating closely with the internal audit managers from each Group company, the Board of Corporate Auditors, the independent auditor and related parties, the division engages in wide-ranging audit activities encompassing internal control systems and risk management. Through each audit, the division endeavors to enhance the efficacy of such critical activities as quality control and environmental protection.
Full Compliance and the Internal Whistleblowing System
The Pioneer Group adheres to all relevant laws and regulations and regards compliance as the foundation for fulfilling its corporate social responsibilities and the basis for creating a workplace environment in which employees can carry out their duties with security and complete peace of mind.
The Business Ethics Committee, chaired by an outside director, was established in accordance with the Basic Rules for Business Ethics, which forms a part of the Rules of the Pioneer Group. This Committee aims to ensure strict adherence to all relevant laws and regulations as well as the Pioneer Group Code of Conduct by all members of Group management and employees.
Behavior that departs from accepted standards can upset the harmony of the workplace. In order to eliminate any wrongdoing, internal auditing has been consolidated across the Group. In addition, the Business Ethics Hotline has been established as an internal whistleblowing system for the entire Group to quickly detect and appropriately address behavior that is in violation of the Pioneer Group Code of Conduct.
The Hotline, operated by an external agency, offers a mechanism that can check the details of informants while maintaining their anonymity. The information is also sent simultaneously to the Business Ethics Committee and the Board of Corporate Auditors, enabling them to ensure a response in good faith.
The Committee Administrative Office promotes the Business Ethics Hotline with posts on the intranet bulletin board and by distributing cards that employees are encouraged to carry at all times. This creates an environment that allows employees to report on any wrongdoing they may encounter.
Outline of Whistleblowing and Inquiry Information Flow
Crisis Control Measures
Forming a part of the Rules of the Pioneer Group, the Basic Rules for Crisis Controls have been formulated to optimize the Group's response in the event of a crisis that has the potential to seriously impact its business and operations. Chaired by a representative director, the Emergency Management Committee has been established as a permanent organization pursuant to these basic rules. In addition to overseeing the education, training and notification processes as they relate to crisis management, the Committee assigns officers, who are responsible for addressing and resolving crisis events and issues, to each division of Pioneer and each Group company. The Crisis Control Manual outlines the roles and responsibilities of each crisis management organization as well as crisis management response procedures and protocol.
In the face of such disasters as a highly virulent influenza epidemic or an earthquake of major proportions, the Pioneer Group places the utmost emphasis on the sanctity of life. In this regard, and in order to ensure a swift resumption of business activities, the Pioneer Group has put in place a disaster manual that outlines those measures and actions to be adopted in the event of a disaster or crisis. Moreover, the Group has taken steps to secure adequate reserves of emergency food, medical and other supplies while maintaining appropriate modes of communication. These initiatives are supported by continuous emergency drills and training.
The actions of each business site in the immediate aftermath of the Great East Japan Earthquake that struck the nation in March 2011, together with the aforementioned reserves of emergency food, medical and other supplies and the Group's communication network, all played an important role in grasping the status of damage.
Pioneer plant in Thailand with the ground floor flooded
Led by the Company's president, Pioneer established a countermeasure task force to address such issues as rolling blackouts and concerns surrounding incidents at nuclear power stations resulting from the earthquake disaster. This task force was also charged with the responsibility of considering initiatives and issuing instructions with respect to disaster-stricken business sites and the delivery of emergency supplies to affected employees.
Then in October 2011, flooding in Thailand caused damage to plants owned by two Group companies. In both cases the ground floors of the buildings were flooded, and the plants were shut down for about three months. During this time, efforts were made to minimize the impact on product shipments and deliveries, including switching production to Pioneer Group plants in Japan, China, and Malaysia.
Based on these experiences, Pioneer is devising a business continuity plan to ensure the rapid recovery of business systems after a major disaster.
Policy Regarding Material Suppliers
The Pioneer Group Code of Conduct requires the Group to deal fairly with suppliers on an equal footing, in accordance with relevant laws and agreements. In addition, it requires suppliers to act with awareness of their social responsibility, observing the laws of the countries and regions where they do business, and respecting international agreements of the United Nations, the International Labour Organization, the Organisation for Economic Cooperation and Development, and so on.
The Pioneer Group is striving to ensure socially responsible procurement throughout its supply chain, from parts to products, as a responsible member of society. As part of these efforts, the Group provides its suppliers with the Pioneer CSR Procurement Guidelines, which are grounded in the principles of equity, fairness, environmental conservation and social responsibility. The Group has also executed memoranda concerning CSR procurement with a large number of suppliers and is engaged in cooperative initiatives with them.
In recent years, it has become increasingly important to promote CSR activities throughout the supply chain, including initiatives to ensure business continuity after a disaster and efforts relating to the protection of human rights. Therefore, the Pioneer Group plans to strengthen its activities while obtaining the understanding and cooperation of suppliers.
Appropriate Disclosure of Management Information
Guided by its Basic Rules on Disclosure, which form a part of the Rules of the Pioneer Group, the Group as a whole maintains the basic policy of disclosing accurate management information to all stakeholders including shareholders, investors, customers, suppliers, the mass media and local communities in a timely and appropriate manner. As a matter of course, the Group discloses information required by laws and public regulations. Pioneer also seeks to actively disclose information that may be considered useful for shareholders to make investment decisions and to gain a better understanding of the Group. In addition to this rigorous and fair disclosure of appropriate information, Pioneer engages in highly transparent corporate activities with the aim of deepening the understanding and trust of shareholders, investors and society at large.
Furthermore, taking into consideration certain mandatory provisions introduced from 2009 under the Financial Instruments and Exchange Act, which aim to ensure the adequacy of financial reporting, the Company obtained confirmation from its independent auditor that its internal control system was again adequate and effective. Details of audit results were submitted together with Pioneer's securities report in June 2012.
Under the Rules of the Pioneer Group, the Company has formulated Basic Rules for Prevention of Insider Trading. While Pioneer has endeavored to stringently manage information and to implement a management structure and system aimed at preventing insider trading, improper conduct in April 2007 by a former corporate auditor while in active duty was subsequently uncovered in March 2009. Pioneer is successively implementing various initiatives including the tightening of information management as well as regulations relating to the trade of the Company's shares applicable to directors and employees, while re-emphasizing relevant staff education and training.
Security Export Control
As a global company that undertakes its operations within many communities around the world, the Pioneer Group hopes for the maintenance and expansion of international peace and security. Therefore, the Group regards as fundamental principles the international consensus in security export control and compliance with every country's laws concerning the regulation of exports. In addition, Pioneer has formulated its Basic Rules on Security Export Controls under the Rules of the Pioneer Group and appointed one of its representative directors to oversee the appropriate management of export control.
Ensuring Fair Trade
The Pioneer Group has implemented a variety of measures to ensure strict adherence to anti-monopoly laws and regulations. In addition to establishing the Basic Rules on Fair Trade as a part of the Rules of the Pioneer Group, the Company has issued its Monopoly Prohibition Compliance Manual. Along with ensuring thorough awareness of the manual Group-wide, the Company continues to augment its fair trade compliance counseling and reporting structure and systems, led by its Legal Division.
In addition, Pioneer is strengthening its initiatives to ensure fair trade through training relating to the Japanese subcontract law for employees in departments that purchase goods and services. Other initiatives include the establishment of guidelines to prevent monopolistic behavior, unfair trading methods, and unfair restraint of trade, and making them well known throughout the Group.
Exclusion of Antisocial Forces
In the spirit of undertaking fair corporate activities with respect for social norms as specified in the Pioneer Group Charter for Corporate Operations, the Pioneer Group applies firm, systematic measures as required by the Pioneer Group Code of Conduct to exclude antisocial forces, particularly in the form of organized crime, that threaten the safety and orderliness of civil society. To achieve this, the Group has designated a department to take overall charge of responding to antisocial forces. The internal framework encompasses liaison with specialist external agencies, sharing information within the Pioneer Group, providing guidance in responding to issues, ensuring communication and other measures.
Protection of Intellectual Property and Copyrights
The Pioneer Group not only maintains and manages intellectual property acquired through technology development and other means, but it also undertakes day-to-day measures to respect the intellectual assets of third parties as a matter of principle.
Pioneer and its Group companies have established a copyright liaison meeting for their respective administrators of relevant departments to ensure Group-wide compliance of copyright protection technology in all Pioneer products.
Furthermore, to avoid betraying the trust that customers have in the Pioneer brand, the Company's business divisions and Legal & Intellectual Property Division work together with related departments at Group companies to eliminate counterfeit goods from the marketplace, since they threaten to damage Pioneer's brand value and social status.
For the benefit of the Group's employees in Japan, the Company posted a Q&A page on its intranet bulletin board concerning the protection of copyright in operational activities. At the same time, Pioneer has set up an inquiry desk to answer employees' questions.
Information Security and Protection of Personal Information
Within the Rules of the Pioneer Group, the Company has formulated the Basic Rules for Information Security Management. These Rules form the basis of the Group's information security framework and outline the policies and measures to be implemented to ensure the optimal protection, utilization and management of information assets.