Evaluation of the Board of Directors’ Effectiveness
Basic ideas and policies
The Resonac Group aims to achieve sustainable corporate growth and to increase its medium- to long-term corporate value. To this end, as its responsibility and role, the Board of Directors is expected to build a system to make decisions in a transparent, fair, prompt, and resolute manner and to supervise the management of the system. The Company issues a questionnaire survey to directors and Audit & Supervisory Board members to evaluate the effectiveness of the Board of Directors as a whole and whether it has fulfilled that responsibility and role. Based on the survey results, issues to be resolved are discussed by the Board of Directors.
Results for 2022(former Showa Denko)
Evaluation Method
In December 2022, we conducted a questionnaire survey of directors and corporate auditors (presenting questions and allowing open-ended comments) on their personal assessments of the effectiveness of the Board of Directors in fiscal 2022. Based on these self-assessment results and the discussions on reforming the Board of Directors held in June and September 2022, all directors and corporate auditors came together at the March 2023 Board of Directors meeting to summarize the overall effectiveness assessment for fiscal 2022 and formulate an action plan for fiscal 2023. To ensure the objectivity of the survey and further boost the effectiveness of the Board of Directors, the survey is conducted and the results are tabulated by an external organization.
Evaluation Results
The evaluation results have determined that, in Board of Directors’ meetings, highly effective Board members with a broad perspective and values reflecting a variety of experiences and expertise are engaged in discussions that help to increase corporate value. Handouts and explanations about agendas are standardized and provided beforehand to encourage the members to take part in vigorous and constructive discussions and allow sufficient time for discussions.
With regard to the action plan for 2022, which was made based on the results of evaluation of overall effectiveness of the Board of Directors for 2021, members of the Board of Directors and Audit & Supervisory Board have confirmed facts and issues as follows.
- That specific initiatives to improve the efficiency of the Board of Directors' meetings have been initiated to ensure sufficient time and opportunities for deliberation
- That discussions on what the Board of Directors should look like had been initiated and steps taken toward this end had been shared
We have decided to focus on the following as an action plan for 2023.
- Taking concrete measures to promote the segregation of execution and supervision
- Setting the agenda for future Board of Directors meetings based on the Board's intended purposes and roles
- Ensuring new opportunities for communication and improving on current methods
- Establishing new information-sharing mechanisms and improving on current methods
(Additional comments)
- The Board of Directors' deliberations are deemed to be more fulfilling, as time for deliberation is set aside with a better understanding of the subject matter and a clearer perspective on the issues to be discussed thanks to more in-depth advance briefings.
- It is time to consider how the Board of Directors should be organized to give more weight to discussions on essential strategies and future risks in order to realize management strategies.
- The criteria for agenda items should be revised to give priority to discussions on medium- and long-term affairs.