Corporate Governance

Based on the basic principles of management contained in The Analects and the Abacus (Ethics and Economics), Shimizu strives to manage the company in a highly timely, efficient, transparent, and lawful manner to achieve sustainable growth and increase corporate value over the medium and long-term, while also earning a greater degree of trust from our shareholders and investors, and all other stakeholders, including customers, employees, and local communities. We do so by fulfilling our social responsibilities through business activities.

To achieve this, Shimizu has established a structure that enables the Board of Directors and Audit and Supervisory Board to appropriately supervise and audit the performance of duties by executive officers, based on separation of the management strategy decision-making function from the execution of duties function. Our basic policy on corporate governance is for our directors, executive officers, audit & supervisory board members, and employees to implement compliance management based on high ethical standards.

1.Corporate Governance Structure of Shimizu Corporation

Diagram of Corporate Governance Structure
Diagram of Corporate Governance Structure

2.Management Decision-making & Executive, and Supervisory & Audit Functions

  • Shimizu’s governance structure is based on the separation of strategic decision-making and management supervisory functions from the business execution function. We have introduced an executive officer system and reduced the number of directors. We also established an Executive Nominating Committee to ensure fair and transparent appointment of executive officers and an Executive Compensation Committee to ensure fairness and transparency in evaluating executive officers and determining their compensation.
  • Shimizu forms various committees and meeting groups to ensure efficient decision-making on matters of importance concerning the execution of duties, strategy, and other matters.
  • Two external directors (one of whom is female) have been appointed to strengthen management supervision function, and to promote more active debate by the Board of Directors.
  • Shimizu has established the following Standards on the Independence of External Officers (External Directors and External Audit & Supervisory Board Members).

See the report disclosed to Tokyo Stock Exchange, Inc. for further details.

3.System of Internal Controls

  • Shimizu has established a Basic Policy on Establishment of Internal Controls, based on the Companies Act.

4.Corporate Ethics and Compliance with Laws and Regulations

  • The Analects and the Abacus contain the basic principles of management at Shimizu. The thought process behind this is to earn a fair profit while also contributing to society by engaging in corporate activities that are ethically sound.
  • These are timeless principles that endure through the ages. As society changes and imposes stronger demands on companies to be good corporate citizens and exercise corporate social responsibility, Shimizu works to make sure that management and employees fully understand these principles and act accordingly each day, through compliance with corporate ethical standards.
  • Shimizu established the Code of Corporate Ethics and Conduct to implement compliance management based on high ethical values. Each year we conduct compliance training on fair bidding practices (compliance with anti-trust laws, etc.), anti-corruption (prohibition on facilitation payments), human rights, labor conditions, environmental regulations and other compliance matters for all Shimizu employees.

Compliance Training

Training method e-learning (approx. 10-15 minutes per course), group training, legal newsletters, etc.
Training frequency Compliance overview e-learning, every year (three times a year, including specific topics)
Training content Observing fair bidding practices (compliance with anti-trust laws, etc.), anti-corruption, human rights, labor conditions, environmental regulations, information security, etc.
Attendance rate all employees, 100% (compliance overview e-learning)

Internal Whistleblowing System

  • Shimizu has established an internal whistleblowing system to detect compliance issues as early as possible when a compliance incident occurs and to improve the company’s ability to take corrective action on its own.

Overview of Whistleblowing System

Who can use the system ・Shimizu officers, employees, temporary employees, employees seconded from other companies, etc.
・Subsidiary officers and employees
・Officers and employees of subcontractors and suppliers
Contact for reporting ・Shimizu Corporate Ethics Helpline, Affiliated Business Department of the Corporation, Counselor, External Law Firm, etc.
Protection of whistleblowers Shimizu has established rules to guarantee that a whistleblower will not be subjected to disadvantageous treatment from having blown the whistle on a compliance problem.

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