YKK AP

Corporate Governance

As we inherit the philosophy of the "Cycle of Goodness," we strive to enhance our corporate governance system in an effort to further enrich our corporate value. Our company's basic approach to corporate governance involves several organizations and systems. The Board of Directors serves to make decisions on important matters, such as the company's management policy, and serves as an oversight function. The Audit & Supervisory Board, meanwhile, is the company's auditing organization. The final component of the company's basic approach is the Operating Officer System, a framework that helps the company promote the execution of business and operations.

Corporate Governance Structure

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General Meeting of Shareholders

Separation of management and execution (Execution of duties by directors, Operating Officer System)

Directors comply with the regulations of the Board of Directors and follow the rules regarding director duties, and appropriately carry out business based on the division of duties. They regularly attend compliance training offered by lawyers, etc., and submit to the company written oaths pledging to comply with laws and regulations in performing their duties as directors. In addition, we have introduced the Operating Officer System to ensure the faster execution of business and operations via the separation of management and execution. While directors dedicate themselves to realize total optimization, operating officers execute individual businesses and operations with responsibility and authority, in accordance with the policies resolved in the Board of Directors meeting.

Main Committees for Executing Business/Duties

Compliance Committee

We work to improve the compliance system of our company and subsidiaries. A compliance director is appointed, and he reports to the directors and audit & supervisory board members regarding the development of the compliance system and compliance status.

Brand Management Committee

This committee considers and formulates important policies for our company from a technical standpoint.

Investment Committee

We established the Investment Committee to discuss particularly important investment cases. By going through the review in the committee, they can be evaluated more efficiently by the Board of Directors meeting.

Environmental Policy Board Committee and Environment Committee

The Environmental Policy Board Committee was established to determine our environmental policies and measures, and to supervise the progress of our environmental policy. Also, the Environment Committee promotes the policies of business execution divisions and supervises their progress.

Risk-related Committees (5)

We have appointed a Chief Risk Management Officer (CRO) to promote YKK AP's risk management. We established a Quality Committee, Trade Management Committee, Crisis Management Committee, Information Security Committee, and Technical Asset Management Committee in order to maintain and enforce regulations.

Compliance

Not only do we ensure strict compliance with laws, regulations, and internal rules, we also strengthen our system in response to "social demands."

Corporate Compliance System and Education

We have established a Compliance Committee chaired by the compliance director to promote the YKK AP Group corporate compliance system. Divided into five units, this system promotes compliance activities of YKK AP and affiliated companies.
In addition to regularly holding compliance training for corporate officers, at least two hours of compliance training is provided to all employees per year. We also provide education led by each specialized department and committee to persons involved in specialized fields (personnel labor, purchasing, environmental safety, trade, information security, technical asset management, etc.).

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FY2021 Corporate Compliance System

Standards for Compliance Activities: "YKK Global Criteria of Compliance"

Since FY 2019, YKK AP has been implementing the "YKK Global Criteria of Compliance (YGCC)," which are the YKK Group's compliance standards based on the YKK philosophy "Circle of Goodness" and ISO26000. We continued implementation in FY 2020 despite the impact of COVID-19, and expect to complete deployment to key locations in Japan and overseas in FY 2021, keeping them in place throughout operations.
With the introduction of YGCC, we regularly carry out YGCC audits such as self-inspection and internal audits . Standardized monitoring contributes to reduction of on-site workloads by eliminating duplicate monitoring items.
We also strive to improve overall compliance literacy throughout the company with YGCC education efforts by the Compliance Promotion Office, and further improve transparency and sustainable business activities in the supply chain.

We distribute the YKK Group Compliance Book to all employees as a tool to facilitate greater understanding, awareness, and receptiveness of the YKK Group Code of Business Conduct, which is used across the world, and to encourage behavioral changes that stem from attitude transformations.

The 7 Aspects of YGCC The 7 Aspects of YGCC

Whistleblowing System

YKK Group has introduced the "YKK Group Whistleblowing System" to prevent illegal business acts in carrying out business activities and build a strong compliance-adhering structure by taking early action. The system allows employees to anonymously consult and report behavior that violates laws, work regulations, and company rules to internal and external contact points. We also have consultation desks inside and outside of the company to help employees with work environment matters, mental concerns, and health.
From FY 2020, we also set up hotlines and whistleblowing contact points for YKK AP America Inc. and YKK (China) Investment Co., Ltd. to enhance overseas operations by starting to grasp the number of reports, etc.

Risk Management

Strengthening of Risk Management System

YKK AP has established five risk committees (Quality Committee, Trade Management Committee, Crisis Management Committee, Information Security Committee, and Technical Asset Management Committee) to promote risk management.
In addition, we have appointed a CRO since 2008 to strengthen our risk management system and establish a governance system for emergencies. Under the leadership of the CRO, each committee develops regulations and promotes activities.

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Risk classifications and response

Risk Map Development and Selection of Key Risks

We assess the risks surrounding the business and create a risk map according to changes in the environment, the urgency of response to the risks, and the expected scale of damage. Among these, we identify 36 key risks (figure on the right) that have a significant impact on management. We then clarify the divisions in charge and prioritize measures to prevent the risks in ordinary operations.

Risk Map Risk Map

BCP Initiatives

In preparation for disaster and risk occurring, we have formulated business continuity plans (BCPs) at all locations in Japan and overseas. We carry out regular disaster drills every year, and in FY 2020, we conducted BCP training online due to the spread of COVID-19.
As part of the supply chain BCP, we also purchase our materials from multiple suppliers, strive to grasp and improve the supply chain (through supplier reassessment and reorganization), arrange emergency substitutions, secure inventory, and provide support with management improvement.

Procurement

YKK Group enforces a procurement policy consisting of organizational governance, human rights, labor practices, the environment, fair business practices, and consumer issues. We promote CSR procurement to fulfill our social responsibilities throughout the supply chain based on this policy. To deepen mutual understanding with business partners, we have established our "Basic Transaction Principles" that stipulate the following five principles: compliance with laws, regulations, and social norms along with fair and ethical transactions, consideration of human rights and the labor environment, consideration of the environment along with safety and health, quality and product safety assurance, and information security assurance. By FY 2020, we concluded agreements with 58 major business partners. Going forward, we will conduct CSR questionnaires to confirm the results of our efforts and strive to conclude agreements with more than 150 companies by FY 2024.

CSR Procurement Promotion Goals
Steps toward CSR Procurement

YKK Group Procurement Policy

Ever since YKK's founding, we have based our business activities on the conviction, under the "Cycle of Goodness" YKK Philosophy, that an enterprise is an important member of society, that it must thereby coexist with other elements of society, and the value of its existence will be recognized by the benefits it shares with society. The belief behind this is that no one prospers without rendering benefit to others. We carry out business activities with the aim of bringing mutual prosperity, and our intent is that innovative ideas and inventions will result in business expansion for the YKK Group, which in turn would bring prosperity to customers and business partners, and thus benefit all society. This is none other than our execution of corporate social responsibility.

Stakeholder Dialog

We work with all stakeholders, including employees, customers, business partners, and local communities, to continue being a company that is trusted by the community and loved by society. We strive to improve our corporate value by providing a place for dialogue as necessary to encourage business innovation and product quality improvement.

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Stakeholder Dialog