Corporate governance structure

SMK regards corporate governance as a means for structure and operation of sound and effective business management and strives to optimize and enhance them. In April 2002, the posts of Chairman and President were decoupled and a system for Vice President and an outside board member system were introduced. As a result, the decision making and task administration functions by the Board Meeting for business administration were clearly separated from the task performance function by Vice President, and a system has been established for clarification of management responsibility and speedy business judgment. The Auditors’ Meeting comprises five auditors with three of them being outside auditors for monitoring directors’ duty performance on an objective standpoint.

Approach to compliance

SMK defined the “SMK Group Charter for Corporate Behavior” and started promotion of compliance in 1997. In 2005, the Compliance Committee was organized and in April 2006 the “SMK Group Code of Conduct ” was defined. In July 2006, the “SMK Ethics Helpline” was put into operation. The “SMK Group Charter for Corporate Behavior” and the “SMK Group Code of Conduct ” are available not only in Japanese and English but also put into Chinese and distributed to all employees of every globally located SMK group company. In addition, for better understanding, “explanatory meetings for compliance” has been provided to all SMK group company employees on a continual basis.

SMK Group Charter for Corporate Behavior

SMK-Group, in addition to being economic entity engaged in the pursuit of profit through fair competition, must be useful to society as a whole. For this reason, SMK-Group will adhere to the following nine principles; respect the letter and spirit of all laws, whether domestic or foreign, and of international rules, and behave in a socially responsible manner.

1. For customers' confidence, we will develop and provide superior goods in terms of quality, cost, and safety through our accumulated advanced technology.

2. To be understood/supported by customers, business partners, and shareholders, we will engage in fair, transparent, and free competition, under the spirit of independence, self-help, and self-regulation.

3. We will promote communication with society, by fairly disclosing corporate information, as an open enterprise in the advanced information network age.

4. We will take independent and positive action, fully recognizing the necessity of environment conservation.

5. We will strive to make it possible for employees to lead pleasant and enriched lives, by guaranteeing a comfortable and safe work environment and respecting employees' dignity and individuality.

6. We will stand firm against antisocial forces and organizations that threaten the order and security of civil society.

7. In overseas operation, we will observe international rules, respecting the cultures and customs of the hosting society, and will manage ourselves in a manner that contributes to local development as good corporate citizen.

8. In order to turn the spirit of the Charter into reality, top executives will always listen to the voices within/outside SMK, take the leadership to make all relevant Group people be fully aware of the Charter and to bring corporate systems into line with it, and will endeavor to cultivate corporate ethics.

9. When the charter is violated, top executives will take the initiative in resolving the problem, endeavoring to clarify its causes and prevent its recurrence, and take necessary action as explain precisely to the society/punish responsible person including themselves. 

SMK Group Code of Conduct

The SMK Group Code of Conduct was issued on April 1, 2006 with our eyes set on getting ourselves prepared for increasing social requirements for CSR.  This Code succeeds the concept of the “SMK Group Charter for Employee Behavior” that can be considered as the basic philosophy of promotion by SMK of CSR, and specifically defines events that constitute the base of promotion of compliance.

Introduction

 This SMK Group Code of Conduct sets forth the basic internal regulations to be observed by all officers and employees of SMK Group. SMK Group commits itself to be bound by this SMK Grope Code of Conduct and at the same time requests all officers and employees of SMK Grope to read, understand, and comply with this SMK Group Code of Conduct.

1.General provision
1) The Purpose of This Code
2) Scope of Application

2.Relations with Customers, Suppliers and Competitors.
3) Product Safety and Quality
5) Free and Fair Competition
6) Fair Transactions with Suppliers of Materials and Services
7) Entertainment and Gifts
8) Fair Advertising and Public Relations

3.Relations with Society
9) Compliance with Laws
10) Social Contribution
11) Prohibition of Child Labor and Forced Labor
12) Donations and Limit of Political Donations
14) Environmental Conservation and Protection
15) Compliance with Laws Concerning Import and Export

4.Relations with Shareholders and Investors
16) Disclosure of Management Information
17) Prohibition of Insider Trading

5. Relations with Employee
18) Respect for Human Rights, Prohibition of Discriminations
19) Protection of Personal Information
20) Safety and Health in the Workplace

6. Relations with Our Company and Its Assets
21) Compliance with Employment Regulations
22) Appropriate Accounting Procedure
23) Prohibition of Private Activity
24) Control of Business Confidential Information.
25) Appropriate Use of Corporate Assets
26) Protection of Intellectual Property (Rights)

7.SMK Ethics Helpline
27) SMK Ethics Helpline

8. Supplementary Provision
28) Improvement, or Amendment of This Code of Conduct.
29) Reference
30) Penalty
31) Submission of Pledge Card
32) Enforcement
SMK Code of Conduct shall be effective as of 1 April 2006.
Revised August 1st, 2007.

IR activities

SMK has emphasized the importance of impartial and continual provision in a timely manner of information necessary for making investment decisions to the current shareholders and potential investors into SMK’s shares.
Materials we made public include not only those obligatorily required for disclosure such as financial statements and short form financial reports but those we autonomously provided for IR presentation meetings.
Specifically, we have conducted the following activities:

• ①MOVE-UP statements
  Example: Announcement of financial statements for the term ending Mar. 2007 → April 25, 2007
• ②DISCLOSURE the of contents
  (To include explanatory materials used during the business result presentation meetings, in addition to business result presentation materials )
  ⇒Click here for more information
• ③Voluntary provision of IR presentation meetings four times a year (including the times for announcement of quarterly financial statements) for institutional investors since 2000
• ④Holding a company presentation session for shareholders on the days of shareholders’ meetings
• ⑤Provision of opportunities for presentation of company business conditions to overseas institutional investors (by a top executive of the Company in overseas countries)