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Corporate Governance

The KOSÉ Group, in line with its Behavioral Charter that serves as the core of its Action Guidelines, is committed to the belief of its founders in having a “mind to follow the right path.” The “KOSÉ Sustainability Plan” defines “Thorough implementation of corporate governance” as one of the six fundamental compliance policies. The KOSÉ Group strives to become a company that is trusted and supported by customers and the public at large through implementing self-governance, acting based on judgment in good faith and use of common sense, and respecting the rights of all persons concerned.

Sustainability Policies

Establishment of the Corporate Governance System

Corporate Governance (Corporate Information)

KOSÉ Group Action Guidelines and code of conduct

The KOSÉ Group defines its Behavioral Charter and Code of Conduct (shown below), in the KOSÉ Group Action Guidelines. The Guidelines stipulate that employees are required to comply with laws and regulations, observe social norms, and make decisions and take actions in good faith and through the use of common sense at all times. They also encourage employees to make efforts to ensure they will continue to be trusted by the public.The Guidelines are made available to officers and employees via a groupware, and they are used as a training material for new employees in Japan. They are also available as a booklet in four languages (English, Chinese (simplified and traditional), Korean and Thai) for distribution to local employees in overseas offices.

KOSÉ Group Code of Conduct

1. We will comply with laws and regulations and pledge to observe the following standards in our relationship with customers and clients:

  • We will provide excellent and safe products.
  • We will provide appropriate information and services.
  • We will not take advantage nor impose the KOSÉ Group’s position in our relationship with our clients for personal interests.

2. We will comply with laws and regulations and pledge to observe the following standards in our relationship with the community and society:

  • We will work to improve the transparency of our corporate management and business operations as well as accurately and promptly disclose corporate information to ensure our corporate accountability to our customers, shareholders, investors and communities as well as society in general.
  • We will ensure the appropriate management and protection of any information about our company and customers.
  • We will make efforts toward environmental conservation through all of our processes including development, manufacturing, distribution and disposal by developing ecological products and by using energy and resources efficiently.
  • We will use our intellectual properties appropriately and take steps to protect our intellectual property rights.
  • We will maintain a healthy and honest relationship with the government and its administration.
  • We will not conduct any antisocial act. We will take a firm stance in dealing with antisocial forces.
  • We will respect customs and cultures in all countries and regions and comply with their laws and regulations.

3. We will comply with laws and regulations and pledge to observe the following standards in our relationship within our company and our employees:

  • We will comply with our company’s rules and regulations.
  • We will take steps to maintain a healthy office environment at all times, respect the human rights of each individual, and we will not engage in any action that constitutes discrimination.

4. We will take leadership in ensuring awareness and compliance with laws and regulations.

  • Our management recognizes that the implementation of this Code of Conduct is its role.
  • Our management will lead by example and ensure awareness and compliance.We will establish a compliance committee, stay open to internal and external feedback and foster mutual communication to establish effective internal systems.

Risk management and compliance education

Our Group has established a Risk Management and Compliance Committee and has formulated a Business Continuity Plan (BCP) to ensure the continuation of corporate activities in the event of a disaster or other emergency. In addition to regular compliance training and other ongoing employee education, we have established a social media policy and are working to ensure that social media is used with an eye to risk.

Risk Management Orientation

An orientation for officers, managers, and executives is held every year to provide a venue to share information on the changes in laws, regulations and environment. With a goal of establishing company-wide risk management compliance maintenance activities, activities to drive awareness are held continually with the use of recent cases.

Compliance Training

Training for All Employees (including temporary and part-time employees)

Since 2008, every year, trainings that focus on the important issue of compliance is given to KOSÉ Group employees through the use of e-learning or through handing out learning materials. Participation is managed strictly and all employees are urged to take part in them.All employees are encouraged to make decisions and take actions in good faith and through the use of common sense in every possible scenario that may occur in daily work including, but not limited to, information leakage, presents from clients, patronage to foreign officials, preventing any form of harassment, and others.

  • FY 2012 "Vol.5 Learn by Case Studies! Social media policy"
  • FY 2013 "Vol.6 Learn by Case Studies! Information Management"
  • FY 2014 "Vol.7 Review the Points! Personal Information Protection and Leakage Prevention"
  • FY 2015 "Vol.8 Learning about Harassment in the Workplace"
  • FY 2016 "Vol.9 KOSÉ Group Action Guidelines"
  • FY 2017 "Vol.10 Learn by Case Studies! Compliance Basics"
  • FY 2018 "Vol.11 Compliance Basics + Compliance Awareness Survey"
  • FY 2019 "Vol.12 Lean from Harassment Cases – Responding to the Latest Legislation"
  • FY 2020 "Vol.13 Protect Organizations and Individuals: Measures against Social Media Risks in the Smartphone Era"

Since 2017, we provide new employees with training in accordance with the “KOSÉ Group Action Guidelines”. In particular, managers are trained on specific examples of harassment, which is important for their position, in training for new managers.(28employees took the course in 2020.) We also conduct training to prevent corruption when formulating the KOSÉ Group Global Bribery Prevention Guidelines.

Number of employees receiving compliance education to prevent corruption and harassment: Sustainability data

Training for Beauty Staff

Since FY 2014, a training page entitled “Let’s Aim to become Compliance Beauties!” is published in the EMB Textbook that is issued 6 times a year as a training handout for Beauty Staff. Relevant cases that a Beauty Staff who engages with customers in many occasions must know are disseminated in the form of a four-panel manga.

Trainings for participants based on their groups

Newly-hired employees, newly-appointed managers, and managers of group companies take part in a compliance training specifically designed for their group once every year. Topics including introduction to compliance, information security, and harassment are delivered to each participant based on the participants’ needs. One-on-one trainings are provided to employees who are newly-assigned overseas as a part of risk management in a global business environment to ensure that they understand and comply with the country’s or region’s laws and regulations.

Compliance Training Month (December to January, every year)

Three types of compliance posters are created and distributed/posted in domestic group companies, offices and branches (73 locations in Japan).

Social Media Policy (in the products and beauty information website)

Activities for Corruption and Bribery Prevention

To remain honest, fair, impartial and trusted by society, the Group defines corruption as “the use of entrusted power, whether monetary or otherwise, for personal gain” and works to prevent all forms of corruption, including bribery, facilitation payments, fraud, extortion, collusion, money laundering, excessive entertainment and gift giving, collusion, embezzlement, falsification, breach of trust and concealment. The KOSÉ Group Action Guidelines, Basic Policy on Procurement, and the KOSÉ Group Global Anti-Bribery Guidelines set forth basic rules for relationships with customers, business partners, government agencies, and other entities, and we are working to ensure that all employees are fully aware of these rules. In addition, the Board of Directors has adopted a resolution on action guidelines against corruption in general. The Risk Management and Compliance Committee reports any corruption issues to the Board of Directors.

Number of legal violations (Significant incident related to business operations): Sustainability data

Dealing with Clients

  • When selecting consignees, the selection is made from multiple candidates in accordance with the law through a fair evaluation. The KOSÉ Group’s will not take advantage nor impose the KOSÉ Group’s position for personal interests.
  • Exchange of presents with clients is prohibited with the exception of cases within bounds of socially accepted norms.
  • Deals with corporations or individuals that are deemed to have a special relationship with The KOSÉ Group will not be honored except for sales agreements.
  • For new transactions, agreements are entered following the Basic Policy on Procurement.

Basic Policy on Procurement (Material Procurement Information)

Appointment of Business Partners (Distributor, Agent, etc.)

When appointing a business partner (distributor, agent, etc. collectively “Business Partners”), in accordance with the “KOSÉ Group Global Bribery Prevention Guidelines” and the “KOSÉ Group Global Bribery Prevention Manual”, the following items are subject to prior scrutiny, the appropriateness of services and compensation is examined, and the approval of the responsible person is obtained.

  • Business Partner Integrity (background of the referral, relationship with public officials, past involvement in bribery, recipients of business partner remuneration, etc.)
  • Business Partner Competency (performance history, expertise, substance, ease of communication, etc.)
  • Terms of the consignment agreement with the business partner (details of the consignment, the amount of money to be paid for the consigned business, whether or not receipt is required by the business partner, whether or not there is a provision prohibiting bribery, the contract period, etc.)

We will also strive to include anti-corruption and anti-bribery clauses in our contracts with our business partners.

Dealing with Public Officials

The KOSÉ Group established the KOSÉ Group Code of Conduct and KOSÉ Group Global Bribery Prevention Guidelines, conducts its operations within their bounds, and does not allow bribery to public officials and people in equivalent positions. We prohibit unlawful donations and promises of money, presents, services and other profits (including facilitation and payment) to public officials to gain deals and unfair profits, and continue to work to prevent corruption and establish and maintain fair business practices. We also conduct detailed audits and investigations in selecting distributors and agents and require prior agreement to our standards.

Facilitation and payment refers to small amount payments made to public officials in order to facilitate the processing involved in government services where they do not have discretion.

Corruption risk assessment in business

Risk Management Promotion Committee conducts overall risk assessment by business function every year, and a risk analysis for bribery and corruption including collusion with business partners is performed in the process.

Establishment of Compliance Help Desk

We have established a Compliance Consultation Desk to detect possible illegal activities (including all forms of corruption, including bribery) and violations of internal rules, including human rights issues such as bullying and harassment, that may be taking place within the Group. The Compliance Promotion Committee or the lawyer in charge of compliance can be selected for reporting (consultation) by e-mail or telephone. This contact point is made known to employees through the “KOSÉ Group Code of Conduct” distributed to all employees upon joining the company, compliance awareness posters displayed on a regular basis, and the “EMB Textbook,” a teaching material for beauty consultants.
All information given through the Help Desk are handled in a way that ensures that the informant is not put at risk. With advice from external lawyers, the Compliance Committee acts on this information fairly and sincerely, works to get the facts early and resolve issues promptly.
A Compliance Help Desk for group companies overseas is also available where employees of each office can directly report to the head office via email. This information is also disseminated to employees.

Number of Calls to Compliance Consultation Desks: Sustainability data

Consultation and reporting by business partners (JP)

Tax transparency

  1. In the KOSÉ Group, the Board of Directors is responsible for overseeing tax risks, and the director in charge of the tax division is designated as the person responsible for overseeing taxation. Under the supervision, the department in charge of finance manages and reports on tax matters.
  2. The Board of Corporate Auditors regularly evaluates tax-related matters through reports from the internal audit department and the accounting auditor.
  3. KOSÉ Group will comply with the applicable tax laws in each country and will make appropriate declarations and payments with respect to their spirit. In addition, we do not conduct transactions solely for tax avoidance without business purpose or economic reality.
  4. KOSÉ Group will work with tax authorities in each country sincerely to ensure that the Company’s business is accurately understood and to build sound relationships so that proper taxation can be made.
  5. KOSÉ Group will promote appropriate tax treatment, including the elimination of potential double taxation, in compliance with laws and regulations.We will work to optimize tax expenses.

Information security

With the increased adoption of information technology, it has become increasingly important to protect personal information. Recognizing that the protection of personal information is an important risk management issue, we updated the Management Regulations for Personal Information Protection, which were developed in 2005, to take account of current conditions. More specifically, we have strengthened the management system by creating a new position of Personal Information Manager, prepared a personal data register, revised the management manual and the reporting route for reporting security breaches concerning personal information, and placed emphasis on ensuring the implementation of the revised regulations. We are making sure that all employees are fully informed of and will implement appropriate management of personal information.

Handling of Personal Information (in the Products and Beauty Website)

Number of personal data breach incidents reported to Personal Information Protection Commission: Sustainability data

Personal Information Protection and Management System

Personal Information Protection and Management System

Appropriate Disclosure of Information to Investors

Financial Results Briefing

A Financial Results Briefing is held twice a year for institutional investors and analysts. We are also focusing our efforts in IR activities to gain the understanding and trust of shareholders and investors through proper information disclosure by holding activities such as IR seminars for females.

IR (investor information)

Company Information List

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