Corporate Governance

Corporate Governance

Fundamental policy on corporate governance

Understanding the importance of compliance and corporate ethics, Yoshinoya Holdings believes that it has a mission to consistently improve its enterprise value while boosting management efficiency, soundness, and transparency, to become a company that is trusted and respected by society.
In addition to its efforts to develop and maintain good relations with a range of stakeholders, including shareholders, customers, employees, business partners, and communities, the Company strives to increase management transparency, disclosing information actively and promptly to its shareholders and investors.

  • The Group’s corporate governance structure

Takeover Defense Measures

Notice of Approval of Continuation of Countermeasures (Takeover Defense Measures) Regarding Large-Scale Purchase of Company Shares.

The Company’s countermeasures against large-scale purchases of its shares, which has been approved by its shareholders at the 51st Ordinary General Meeting of Shareholders held on May 29, 2008 (hereinafter referred to as “the Original Plan”). The original plans with necessary modifications which has been approved by its shareholders at the Ordinary General Meetings of Shareholders held on May 26, 2011, May 22, 2014, and May 25, 2017, respectively and continued to be in use, expired at the end of the 63rd ordinary General Meeting of Shareholders held on May 21, 2020 (hereinafter, the takeover defense measures effective until the end of the 63rd Ordinary General Meeting of Shareholders, is called "The former Plan").

The Company reviewed The Former Plan, considering how to ensure and improve its enterprise value and the common interests of shareholders. Based on the reports of the Corporate Value Study Group and general trends, the Company amended The Former Plan and proposed the continuation of countermeasures (takeover defense measures) toward large-scale purchases of Yoshinoya Holdings share certificates, etc. as proposal item 4 to the 63rd Ordinary General Meeting of Shareholders held on May 21, 2020. The proposal was approved.
In accordance with the will of the shareholders, as demonstrated at the shareholders’ meeting, the Company will continue to ensure and improve its enterprise value and the common interests of the shareholders.

Internal Control

A summary of the decisions pertaining to the system to the ensure performance of director duties conform to the laws and Articles of Incorporation, and systems to ensure the proper operations of companies and the operations of corporate groups comprised from those companies and their subsidiaries, is as follows.

  1. System to ensure Company Group directors and employees' performance of their duties comply with laws and regulations and Articles of Incorporation
  2. System relating to the storage and management of information on directors' performance of their duties
  3. System relating to the management of the risk of loss and relevant regulations of the Company Group
  4. System to ensure directors' efficient performance of their duties
  5. System to ensure proper operations at the corporate group consisting of the Company and subsidiaries
  6. Matters relating to employees who assist corporate auditors with their duties at their request
  7. Independence of employees assisting corporate auditors from directors
  8. System for directors and employees to report to corporate auditors
  9. Matters pertaining to payments in advance of costs incurred by the execution of corporate auditors duties or, costs incurred for execution of other duties of redemption procedures or, policies concerning processing of debt
  10. Other systems to ensure effective audits by corporate auditors

Basic policies on internal control

  1. System to ensure that directors and employees' performance of their duties comply with laws and regulations and the Articles of Incorporation
    1. The Company and Group companies shall share and implement the six values and promises to the stakeholders as a common philosophy and guidelines to achieve the Group business philosophy “For the People.”
    2. To have the Company Group directors and employees comply with laws and regulations, the Articles of Incorporation and corporate ethics, the Group shall promote in-house education under compliance-related regulations and the Code of Conduct (compliance guide).
    3. To create financial reports properly in compliance with laws and regulations, the Group shall establish internal regulations for accounting and shall evaluate and improve the regulations and their operation in accordance with a plan for each fiscal year.
    4. The Group Audit Office shall conduct internal audits to check the status of compliance.
  2. System relating to the storage and management of information on directors' performance of their duties
    1. Documents or electromagnetic records of the directors' performance of their duties shall be created, stored, and controlled (or disposed of) properly under rules, including document control regulations, regulations of the Board of Directors, and criteria for holding conference bodies and decision making. Records shall be checked, and regulations and criteria shall be reviewed as needed.
    2. If corporate auditors or assistants of auditors ask to peruse information on directors' performance of their duties, the directors shall offer the relevant information and documents for perusal promptly.
  3. System relating to the management of the risk of loss and relevant regulations of the Company Group
    1. The director in charge of a division of the Company, a subsidiary, or an affiliate shall classify disaster risks and business risks that could adversely affect the results and shall assess the risks. The director shall establish regulations, criteria, and guidelines relating to the management of risks (and the system for managing risks) in each domain and shall handle risks appropriately under the regulations, criteria, and guidelines.
    2. If the risks described above emerge, and if serious losses are expected, the director responsible for the division of the Company, subsidiary, or affiliate shall report that to the Board of Directors immediately.
  4. System to ensure directors' efficient performance of their duties
    1. The Company shall hold a meeting of the Board of Directors once a month and shall hold additional meetings as needed. To assist the Board of Directors in making prompt and correct business decisions, the Company shall have conference bodies, including the Group Strategy Council, committees, and projects. Decisions made in these bodies shall be carried out by the relevant sections.
    2. The job assignments of directors and employees shall be clarified by administrative authority regulations and division of duties regulations. Decision-making regulations shall be reviewed from time to time, and the delegation of authority shall be promoted in the decision-making system. There shall be an appropriate and efficient system for the execution of business.
    3. The Company shall have a Group Audit Office as an internal audit department. The Group Audit Office shall monitor the appropriateness and adequacy of each division's performance of operations and shall report to the Board of Directors in a timely manner.
    4. The Company shall enhance and strengthen its corporate governance system through the engagement of third parties, including the guidance and advice of corporate lawyers about compliance and statutory audits by the accounting auditor.
  5. System to ensure proper operations at the corporate group consisting of the Company and subsidiaries
    1. Subsidiaries and affiliates shall report important matters specified in affiliate management regulations to the Company and shall seek either advanced discussions, approval or otherwise report to the Company. They shall hold Business Progress Debrief Meetings regularly. In this way, the subsidiaries and affiliates shall secure a system to ensure the appropriate performance of operations, while receiving report on business and risk management.
    2. Subsidiaries shall be subject to internal audits conducted regularly by the Company's Group Audit Office. The results of internal audits shall be reported to the Company's representative director.
    3. If the director responsible for the Management Strategy Office recognizes an occurrence of a risk of loss, he or she shall immediately report the details of the risk, the extent of possible losses, and the effect of possible losses on the Company to the Company's Board of Directors.
    4. The Company and its subsidiaries and affiliates shall have points if contact for whistleblowing as part of a system of reporting violations of laws and regulations or the Articles of Incorporation within the Group by directors or employees.
    5. The Company and its subsidiaries and affiliates shall not engage in any way with antisocial forces and groups that pose a threat to order and security in civil society, and shall take a resolute stance against demands from antisocial forces and groups. The Company and its subsidiaries and affiliates shall continually improve systems for removing antisocial forces in cooperation with the police, related organizations, and professionals such as lawyers.
  6. Matter relating to employees who assist corporate auditors with their duties at their request
    At their request, the Company shall provide corporate auditors with employees who will assist them as needed.
  7. Independence of employees assisting corporate auditors from directors
    If corporate auditors have employees assisting them, the transfer and evaluation of the employees shall require the approval of the Board of Corporate Auditors. The employees shall not concurrently engage in business operations.
  8. System for directors and employees to report to corporate auditors
    Corporate auditors shall attend meetings of the Board of Directors and other important meetings and shall receive reports on important matters from directors and employees. Directors and employees shall directly report the following as needed at the request of corporate auditors:
    1. Activities in divisions in relation to the building of the Company's internal control system
    2. The activities of corporate auditors at the Company's subsidiaries and affiliates
    3. The Company's important accounting policies and accounting standards, and changes in them
    4. The content of announcements of results and results forecasts and important disclosure documents
    5. The status of the management of the personal information that the Company possesses
    6. Facts at risk of causing considerable damage to the Company
    Furthermore, executives and employees having discovered facts of incidence of inappropriate conduct or action that is in violation of significant laws and Articles of incorporation pertaining to execution of duties or, persons in receipt of report(s) from employees or such persons of Subsidiaries, etc., shall submit their report to the corporate auditors.
    Disadvantageous treatment of persons whom submit such reports, on the grounds of submitting such a report, is prohibited and others shall be informed to the effect thereof.
  9. Matters pertaining to payments in advance of costs incurred by the execution of corporate auditors duties or, costs incurred for execution of other duties of redemption procedures or, policies concerning processing of debt
    The director shall, in order to secure the effectiveness of the audit by the auditors, implement a budgetary provision for the auditor costs and, where the auditors request payment of reasonable costs to execute their duty, respond accordingly.
  10. Other systems to ensure effective audits by corporate auditors
    1. To understand the status of important decision-making and business execution, corporate auditors may attend meetings of the Board of Directors and other important meetings and express their opinions. Corporate auditors may peruse documents about business execution and request explanations from directors and employees.
    2. When carrying out audits, corporate auditors shall exchange opinions with the Group Audit Office and the accounting auditor and shall cooperate with them.

Revised on May 27, 2015

Compliance

As a member of the local community and a company that sustains itself through its contribution to society, we position strict compliance as a matter of top priority in our business activities. We assure all of our stakeholders that our activities will be based on high ethical standards.

Compliance Promotion System

Meeting of persons in charge at the risk management office

At Yoshinoya Holdings, a meeting of persons in charge at the risk management office is convened on a monthly basis, consisting mainly of persons in charge of compliance within the Group. Tasks performed at the meeting include exchanging information on risk management, compliance activities and the operation of the whistleblowing system, identifying important issues that should be given priority, and examining basic policies and concrete measures for dealing with these issues. On-site improvements are sought by feeding back such information to the relevant division of each company, thereby promoting the compliance system within the Group in an integrated manner, not only domestically but also globally. In addition to a point of contact for whistleblowing established at each company, we have the “Group Hotline” in place, serving as a common point of contact for all employees within the Group. Yoshinoya Holdings’ self-cleansing function within its organization is boosted by operating such points of contact in an appropriate manner while making their objectives and method of use understood and widely known among employees through the Compliance Guide, posters, internal newsletters, etc.

Compliance Education

Compliance Guide

We promote on-site knowledge education and hands-on activities by distributing the Compliance Guide to employees and the Compliance Handbook to restaurants as a tool for compliance education, in an effort to spread compliance at the workplace as a whole. In training sessions by job rank held in the Group, where compliance is incorporated into the curriculum, participants deepen their understanding on the importance of the management philosophy and compliance, and learn about practicing compliance in their day-to-day work. Especially in regards to safety and security of food, which is regarded as a matter of the highest priority, efforts are being made by all employees to provide services daily by observing standards, manuals and guides in a thoroughgoing manner.

Risk Management

To manage the risks of losses associated with the Group’s business activities including risks regarding safety and security of food, we have established the Group Risk Management Rules, based on which each division identifies the risks on a quarterly basis, compiles a summary of the materiality assessment, reports it to the Group Risk Management Committee and confirms the progress made in tackling such risks. Yoshinoya Holdings is equipped with a system to take emergency countermeasures according to the risk level in the unlikely event that a risk becomes apparent, making it possible to minimize losses, take measures to prevent recurrence and ensure the credibility of its corporate brand. We also share information on risks across the entire Group, and as appropriate disclose such information to customers, the government, mass media, local communities and industry bodies according to certain standards.

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