Corporate Governance
Basic Approach to Corporate Governance
Through the provision of human resource services and DX services, and by working to solve various problems in the labor market, dip aims to realize a society in which everyone can experience the joy and happiness of work, based on a vision of becoming a “Labor force solution company” under the corporate philosophy of “tapping into dreams, ideas and passion to create a better society.”
Ensuring effective corporate governance is essential to realizing this vision. Under an appropriate corporate governance system, we aim to increase medium and long-term corporate value while fulfilling our responsibilities to all stakeholders by enhancing management transparency and conducting efficient corporate operations.
dip has transitioned from a company with an Audit & Supervisory Board to a company with an Audit & Supervisory Committee with the resolution of the 26th Annual General Meeting of Shareholders held on May 24, 2023. Its aim is to strengthen the auditing and supervision of executive directors and further enhance its system of corporate governance by making Audit & Supervisory Committee members, who are responsible for auditing the execution of duties by board directors, members of the Board of Directors.
dip is determined to continue its efforts to pursue healthy and transparent corporate management and further improve and enhance its corporate governance in the future.
Corporate Governance Report 2024/4/8
Organizational structure
(1) Board of Directors
The Board of Directors, which is the management decision-making organ, consists of eight directors who possess a high degree of expertise and broad knowledge based on extensive experience. Board meetings are held on a monthly basis, in principle, and extraordinary Board meetings are held when needed to discuss and decide important management matters. Based on the basic policy that the ratio of independent outside directors on the Board of Directors should be at least two-thirds and the ratio of female directors should be half, six out of eight directors are outside directors, and we will strengthen the supervisory function of management by appointing outside directors who are independent from the management and controlling shareholders to two-thirds of the Board of Directors.
Chairperson: Hideki Tomita, Representative Director, President and CEO
Board members: Masatsugu Shidachi, Representative Director and COO; Kuniyoshi Mabuchi, Kanae Takeuchi, and Yuka Shimada, Outside Directors; and Eriko Tanabe, Yukiko Imazu, and Misae Maruyama, Outside Director Audit & Supervisory Committee Members
(2) Audit & Supervisory Committee
The Audit & Supervisory Committee consists of three outside directors who possess a high degree of expertise and broad knowledge based on extensive experience. Committee meetings are held on a monthly basis, in principle, and extraordinary Committee meetings are held when needed. The Audit & Supervisory Committee discusses matters stipulated by law and the Articles of Incorporation, conducts significant audit operations in accordance with the audit policy set forth by the Committee and strives to enhance the system for audit and supervision. Board directors who are Audit & Supervisory Committee members attend important meetings, such as Board meetings, to audit the legality and supervise the adequacy of board directors’ execution of duties.
Chairperson: Eriko Tanabe, Outside Director Audit & Supervisory Committee Member
Committee members: Yukiko Imazu, and Misae Maruyama, Outside Director Audit & Supervisory Committee Members
(3) Voluntary Nomination and Compensation Committee
The Nomination and Compensation Committee, a voluntary advisory body to the Board of Directors, deliberates and reports on matters related to director nominations and compensation in response to inquiries from the Board of Directors.
The Committee comprises the representative director, president and CEO and independent outside board directors. The latter must account for a majority of the Committee members, and the Committee must be chaired by an independent outside board director.
Chairperson: Kuniyoshi Mabuchi, Independent Outside Director
Committee members: Hideki Tomita, Representative Director, President and CEO; Kanae Takeuchi and Yuka Shimada, Independent Outside Directors; and Eriko Tanabe, Yukiko Imazu, and Misae Maruyama, Independent Outside Director Audit & Supervisory Committee Members
(4) Corporate Officers Meeting
dip has introduced a corporate officer system to expedite decision-making and ensure smooth execution and has established the Corporate Officers Meeting, which primarily comprises executive directors, and corporate officers. The Corporate Officers Meeting is held every week, in principle, to share information and discuss key matters. It is also attended by Audit & Supervisory Committee members depending on the agenda.
(5) Strategy Promotion Council
dip has established the Strategy Promotion Council, which discusses the agenda of the Corporate Officers Meeting in advance, to support swift management decision-making. It is attended by executive directors. The Strategy Promotion Council meets every week, in principle, to share information and discuss business execution matters. It is also attended by Audit & Supervisory Committee members depending on the agenda.
Note 1: Resolutions of the Board of Directors shall be adopted by a majority of the directors present at any meeting where a majority of the directors are in attendance.
Note 2: Directors (excluding those who are members of the Audit & Supervisory Committee) shall serve a one-year term, expiring at the conclusion of the Annual General Meeting of Shareholders representing one Board Tenure Year since their election.
Note 3: Directors who are members of the Audit & Supervisory Committee shall serve a one-year term, expiring at the conclusion of the Annual General Meeting of Shareholders representing two Board Tenure Years since their election.
dip’s Corporate Governance System
Skill Matrix of Board of Directors and Audit & Supervisory Committee (Reference Material)
Notes: Mses. Kanae Takeuchi, Yuka Shimada, Eriko Tanabe, Yukiko Imazu, and Misae Maruyama are female officers. Ms. Kanae Takeuchi is internationally minded from her many years of living abroad and through her extensive experience as a broadcaster for new programs and interviewer of corporate executives. The chart above is not necessarily a representation of all the relevant experience and expertise held by each officer.
Strengthening the Internal Control System
The Company and its subsidiaries have established the following basic policy regarding the development of an internal control system and will establish an appropriate and efficient system by constantly reviewing the administrative authority and division of duties in response to changes in the business environment and other factors. We also disclose this basic policy to the public and make efforts to promote the establishment of a more appropriate and efficient system by revising it as necessary through continuous reassessment.
Measures to revitalize the General Meeting of Shareholders and Facilitate the Exercise of Voting Rights
In order to allow as many shareholders as possible to participate, we avoid holding meetings during periods of congestion when many other companies are holding their general meetings. Our General Meeting of Shareholders is streamed in real time to allow shareholders the opportunity to participate wherever they are. We have also introduced an electronic voting platform and the ability to exercise voting rights via the Internet.
To enable shareholders to fully consider the agenda for the meeting, we send out the convocation notice at least 22 days prior to the date of the meeting and disclose the notice in Japanese and English (abridged version) on both TDnet and our corporate website. In addition, we are promoting improvements in the design and visuals of convocation notices, and on the day of the General Meeting of Shareholders, we are working to make it easier to understand the Company's business performance and business status by providing business reports using videos in addition to other materials.
Constructive Dialogue with Shareholders and Investors
Basic Philosophy
We recognize that two-way communication with our shareholders and investors, who are valued stakeholders, is essential for our sustainable growth and for the enhancement of corporate value over the medium to long term.
Based on this belief, we will strive to deepen the understanding of our shareholders and investors and build long-term relationships of trust by proactively disclosing information regarding management strategies and the business environment on our corporate website and by enhancing constructive dialogue.
Communication between Shareholders and Interlocutor
The Company's management (Representative Director ,President and CEO, Representative Director, COO, Corporate Officer, CFO Head of Corporate Management Group) will oversee all aspects of our communication with shareholders and other stakeholders, and will strive to realize constructive dialogue.
In addition, based on the wishes of shareholders and investors, other members of the management team (Outside directors, Corporate officers, etc.) and the general manager of the Investor Relations Division, will respond to requests and address the main concerns that arise from meetings.
Specific initiatives for constructive dialogue with shareholders
(1) Organic cooperation with internal divisions to support dialogue
When engaging in constructive dialogue with shareholders and investors, the division in charge of investor relations will assist the interlocutor in cooperation with other divisions to provide accurate information based on the interests of shareholders and investors. In order to promote smooth dialogue with shareholders and others, the division in charge of investor relations will hold regular meetings to collaborate and share information.
(2) Efforts to Enhance Means of Dialogue
In addition to the General Meeting of Shareholders and individual meetings, we hold financial results briefings and small meetings to explain our business status and strategies to our shareholders and investors. Furthermore, we are working to promote dialogue by actively disclosing information on our corporate website and enhancing Integrated Reports.
(3) Internal Feedback Regarding the Content of Dialogue
Opinions, requests, concerns, etc. from shareholders and investors obtained through dialogue are compiled by the Investor Relations Division and reported quarterly to internal stakeholders, including management, at meetings of the Board of Directors, Corporate Officers Meeting, and other management meetings. Matters of high importance or those requiring a prompt response are reported to the CEO, COO, and other members of the management team on a case-by-case basis, without waiting for quarterly reporting opportunities, and are addressed as appropriate.
(4) Management of Insider Information
When engaging in dialogue, we will comply with the separately stipulated "Rules for Management of Inside Information and Insider Trading" and thoroughly manage insider information in accordance with the "IR Policy".
Implementation of feedback on shareholders' and investors' opinions and concerns identified through dialogue
In the previous fiscal year, the Company actively exchanged opinions with shareholders and investors through individual interviews with overseas and domestic analysts and institutional investors, in addition to the General Meeting of Shareholders, financial results briefings (held four times a year) and small meetings. (Number of meetings during the fiscal year ended February 28, 2023: 367)
The content of the dialogues is compiled and reported quarterly to internal stakeholders, including management, at Investor concerns, comments and evaluations regarding the announcements of financial results and other matters are reported on a case-by-case basis, and are utilized in the formulation and execution of management strategies in discussions to further enhance corporate value meetings of the Board of Directors and the Corporate Officers Meeting.
In addition, during the current fiscal year, we are striving to further promote constructive dialogue by increasing opportunities for individual meetings with shareholders and investors, such as by holding a new overseas roadshow.
Items incorporated based on dialogue and subsequent feedback
Newly formulated financial strategies incorporated in the "dip30th" Mid-term Management Plan (announced in November 2023 and covering the period FY02/2025-FY02/2027) were informed through preliminary conversations between the CFO and several shareholders and investors, and further refined and decided by the Board of Directors and the Management Committee. Specifically, we aim to increase corporate and shareholder value by maximizing the equity spread, and have formulated strategies to improve ROE, including a cash allocation policy to achieve the ROE target of 30% in the final year of the Mid-term management plan by increasing profit growth and capital efficiency, and a policy to accelerate business growth through aggressive growth investments.
We will continue to apply the content of our dialogues with shareholders and investors to our management activities to achieve sustainable growth and enhance our corporate value over the medium to long term.