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Concept and System

Basic Concept

Asahi Group Holdings, Ltd. (the “Company”), based on the Group philosophy, the “Asahi Group Philosophy (AGP),” aims to be a group that is trusted even by future stakeholders, and is committed to achieving sustainable growth and increasing corporate value over the medium- to long-term. In order to bring such goals to fruition, the Company has been proactive in its efforts to strengthen Group management in response to globalization, build solid relationships of trust with society including promotion of sustainability management, and enhance its social presence and transparency, such as advancement of engagement with stakeholders, while positioning the reinforcement of the Group’s corporate governance at the top of management priorities. At the same time, the Company has endorsed Japan’s Corporate Governance Code and incorporated it into its governance. In addition, with its sights set on the ultra-long term, the Company’s Board of Directors is promoting discussions on megatrends for the purpose of strengthening foresight with respect to medium- to long-term changes in the business environment and reinforcing its proactive and decisive management by promoting the achievement of the ideal business portfolio and other means.

The Company, to promote the reinforcement of corporate governance, works for sustainable enhancement of the effectiveness of the Board of Directors. The Company makes efforts for sustainable enhancement of the effectiveness of the Board of Directors by evaluating the effectiveness of the Board of Directors and the Audit & Supervisory Board periodically as well as identifying and addressing issues to ensure further enhancement of their effectiveness. Through these efforts, the Company strives to achieve sustainable growth and increase corporate value over the medium- to long-term.

This report summarizes our approach to corporate governance and our efforts to enhance it.

To contribute to the increase corporate value over the mid-to long-term of the company, we decide to analyze and evaluates the effectiveness of the Board of Directors, the Nomination Committee and the Compensation Committee every year. The summary of results of evaluation regarding the FY2022 is as follows:

To contribute to the increase of corporate value over the mid-to long –term of the company, we, Audit & Supervisory Board, decide to analyze and evaluate the effectiveness of the Audit & Supervisory Board. The summary of the results of FY2022 is as follows:

Related Information

Measures for Enhancing Corporate Governance

2000
  • Nomination Committee and Compensation Committee were established.
  • Corporate Strategy Board was established.
  • Executive Officer System was introduced.
  • Number of Outside Directors was increased from 1 to 3.
2007
  • Terms of Directors were shortened to 1 year.
  • Retirement benefits for Directors and Audit & Supervisory Board Members were abolished.
2011
  • The Company transitioned to a pure holding company structure.
2013
  • Takeover defense measures were abolished.
2015
  • Corporate Governance Guidelines were formulated.
  • Evaluations of the effectiveness of the Board of Directors were commenced.
2016
  • Performance-linked stock compensation was introduced for internal Directors.
2018
  • Title of CEO was transferred from Chairperson and Representative Director to President and Representative Director to improve the effectiveness of management supervision from operational execution.
  • Outside Directors/Audit & Supervisory Board Members account for the majority of the members of the Nomination Committee and the Compensation Committee. Both committees are chaired by Outside Directors.
  • Evaluations of the effectiveness of the Audit & Supervisory Board were commenced.
2019
  • The Company transitioned to a structure in which the Chairperson and Director does not serve concurrently as a representative director and serves exclusively as the Chairperson of the Board of Directors.
  • Standards and guidelines were formulated for the resignation of the CEO, the appointment of representative directors, and terms of office for officers.
  • The number of Outside Directors on the Board of Directors was raised, now constituting 1/3 or more of total Board members.
  • The overall functions of remuneration systems were strengthened to provide an incentive to internal Directors.
2020
  • The CXO system was introduced to enhance global governance.
  • The skill matrix of the Board of Directors and the skill set of CEO were formulated.
2021
  • Disclose summary Evaluation Results of the Effectiveness of the Nomination Committee and the Compensation Committee were commenced.
2022
  • The skill matrix of the Board of Directors was revised.
  • Social value indicators for remunerations of Directors are improved.

Characteristic Features of Our Corporate Governance System

Characteristic Features of Our Corporate Governance System

Board of Directors / Directors

In order to ensure balance and diversity in terms of the knowledge, experience and ability of the entire board necessary for the sustainable growth and the increase of corporate value of the Company over the medium- to long-term, the Company has decided that the Board of Directors is to be composed of persons suitable as Directors who have the required wealth of experience, extensive knowledge, high-level expertise, and ability, with reference to the “Skill Matrix of the Board of Directors,” which clearly states the personal requirements of company officers based on the Asahi Group Philosophy, along with the Asahi Group Code of Conduct, and corporate management strategy. Furthermore, Outside Directors shall be persons who meet the requirements of independent officers as defined by the Company such as corporate managers, experts, and others, and at least 1/3 of the Directors.

The Board of Directors aims for sustainable growth and the increase of corporate value of the Company over the medium- to long-term by appropriately fulfilling their roles and responsibilities to ensure the sustainable growth and the increase of corporate value over the medium- to long-term, as well as to promote the improvement of earning capacity and capital efficiency by taking into account their fiduciary responsibility and accountability to shareholders. Such initiatives include determining the Medium- to long -Term Management Policies and promoting their execution, while also properly supporting management’s risk taking by streamlining the internal control system and risk management system.

Meetings of the Board of Directors and attendance of directors

  FY2018 FY2019 FY2020 FY2021 FY2022
Number of regular meetings 13 12 12 12 12
Director attendance rate Average 99.2% 100% 100% 95.2% 100%
Akiyoshi Koji 100% 100% 100% 100% 100%
Atsushi Katsuki 100% 100% 100% 100% 100%
Taemin Park - 100% 100% 100% 100%
Keizo Tanimura - 100% 100% 100% 100%
Kaoru Sakita - - - - 100%
Christina L. Ahmadjian - 100% 100% 100% 100%
Kenichiro Sasae - - - - 100%
Tetsuji Ohashi - - - - 100%
Mari Matsunaga - - - - -
Audit & Supervisory Board Members attendance rate Average 97.4% 100% 100% 100% 98.2
Yoshihide Okuda - 100% 100% 100% 100%
Naoko Nishinaka - - 100% 100% 100%
Yukitaka Fukuda - - - - -
Yumiko Waseda 100% 100% 100% 100% 100%
Yutaka Kawakami 100% 100% 100% 100% 100%
Shigeo Ohyagi - - - - 88.9%
Sanae Tanaka - - - - -

The members were appointed in 2022 and 2023. The members with ※ were newly appointed in 2023. The members with ◆ have already resigned at the end of FY2022.

Audit & Supervisory Board / Audit & Supervisory Board Members

The structure of Asahi Group Holdings' Audit & Supervisory Board is shaped around audits performed by Audit & Supervisory Board Members and the Audit & Supervisory Board, which are independent from the Board of Directors, as well as supervision of the status of the performance of duties by directors.

The Company has decided that a good balance of the entire Audit & Supervisory Board must be ensured in terms of the knowledge, experience, ability and diversity required for sustainable growth and the increase of corporate value of the Company over the medium- to long-term, and that the Audit & Supervisory Board is to be composed of suitable persons reflecting the requirements of Directors and Audit & Supervisory Board Members derived from the group philosophy, the “Asahi Group Philosophy,” the Asahi Group Code of Conduct, and management strategy. Audit & Supervisory Board Members are appointed from among candidates who have appropriate experience, abilities, and high-level knowledge of finance and accounting or legal affairs. In particular, at least one individual with significant insight into finance and accounting shall be appointed. Furthermore, 3 of the Audit & Supervisory Board Members shall be Outside Audit & Supervisory Board Members who meet the requirements for independent officers which have been established by the Company, and be appointed from among corporate accounting experts, lawyers and persons with experience in corporate management who possess abundant experience and comprehensive knowledge in relevant fields.

The structure of the Audit & Supervisory Board includes the Outside Audit & Supervisory board members mentioned above as well as three full-time staff who do not take instructions from directors or employees to assist the Audit & Supervisory Board by supporting their smooth participation in important meetings and regular reading of documents for approval in order to ensure the smooth execution of audit operations. In addition, key items and other content of the Auditing Standards for Audit & Supervisory Board Members are reviewed annually in line with changes in the current business environment as a part of the audit policies for Audit & Supervisory Board Members.

Meetings of the audit & supervisory board were held 12 times in FY2022, with a 98.2% attendance rate of Audit & Supervisory Board Members.

Meetings of the Audit & Supervisory Board and attendance of Audit & Supervisory Board Members

  FY2018 FY2019 FY2020 FY2021 FY2022
Number of meetings 12 13 13 13 12
Audit & Supervisory Board Members' attendance rate Average 100% 98.5% 100% 100% 98.2%
Yoshihide - 100% 100% 100% 100%
Naoko Nishinaka - - 100% 100% 100%
Yukitaka Fukuda - - - - -
Yumiko Waseda 100% 100% 100% 100% 100%
Yutaka Kawakami 100% 100% 100% 100% 100%
Shigeo Ohyagi - - - - 87.5%
Sanae Tanaka - - - - -

The members were appointed in 2022 and 2023. The members with ※ were newly appointed in 2023. The members with ◆ have already resigned at the end of FY2022.

Reasons for the Election of Outside Directors and Outside Audit & Supervisory Board Members

Christina L. Ahmadjian
[Outside Director]
Since being appointed as an Outside Director of the Company in 2019, Christina L. Ahmadjian has participated in discussions and activities that contributed to substantial and appropriate supervision of the Board of Directors from the perspectives of ESG, sustainability, and a global perspective, based on her viewpoints as a university professor and an expert in risk and governance, human resources and culture, as well as her experience as an outside officer of other companies.
Furthermore, as Chairperson of the Compensation Committee, to enhance the supervisory function of the Board of Directors, she has led the operations of the committee in a fair and transparent manner, and reported to the Board of Directors on matters such as the establishment of social value indicators for the medium-term bonus and bonus payment plans. In addition, as a member of the Nomination Committee, she gave specific opinions and recommendations regarding the Board of Directors Skill Matrix, oversight of the CEO succession plan, and other matters. She is expected to demonstrate sustainability, global, risk and governance, human resources and cultural skills supported by her experience and insight.
Accordingly, the Company deems that Christina L. Ahmadjian is a necessary human resource who is indispensable to the composition of the Board of Directors, mainly to provide a supervisory function from the perspective of an expert on global organizational culture and other matters for increasing the effectiveness of the decision-making and oversight functions of the Board of Directors, and thus the Company re-appointed her as an Outside Director.
Kenichiro Sasae
[Outside Director]
Since being appointed as an Outside Director of the Company in 2022, Kenichiro Sasae has participated in discussions and activities that contributed to substantial and appropriate supervision of the Board of Directors on global business execution from the perspective of geopolitical risk and international affairs, based on his extensive knowledge and experience regarding international politics and economics, as well as his experience as an outside officer of other companies.
Furthermore, as Chairperson of the Nomination Committee, to enhance the supervisory function of the Board of Directors, he has led the operations of the committee in a fair and transparent manner, and reported to the Board of Directors on matters such as the Board of Directors Skill Matrix, oversight of the CEO succession plan, and proposals regarding officer appointments. Furthermore, as a member of the Compensation Committee, he gave specific opinions and recommendations regarding reports on matters such as the establishment of social value indicators for the medium-term bonus and bonus payment plans. He is expected to demonstrate ability in long-term strategy, global skills, senior leadership, and risk and governance skills supported by his experience and insight.
Accordingly, the Company deems that Kenichiro Sasae is a necessary human resource who is indispensable to the composition of the Board of Directors as a member of the Board who has diverse insight, expertise, and capabilities for increasing the effectiveness of the decision-making and oversight functions of the Board of Directors, and thus the Company re-appointed him as an Outside Director.
Tetsuji Ohashi
[Outside Director]
Since being appointed as an Outside Director of the Company in 2022, Tetsuji Ohashi has participated in discussions and activities that contributed to substantial and appropriate supervision of the Board of Directors such as asking questions and raising concerns about group governance and global business execution that grasp the essence based on the perspective of managing a global corporation and his experience as an outside officer of other companies.
As a member of the Nomination Committee, he gave specific opinions and recommendations regarding the Board of Directors Skill Matrix, oversight of the CEO succession plan, proposals for officer appointments, and other matters. Furthermore, as a member of the Compensation Committee, he gave specific opinions and recommendations regarding reports on matters such as the establishment of social value indicators for the medium-term bonus and bonus payment proposals. He is expected to demonstrate ability in long-term strategy, global skills, discontinuous growth skills, senior leadership, and finance skills supported by his experience and insight.
Accordingly, the Company deems that Tetsuji Ohashi is a necessary human resource who is indispensable to the composition of the Board of Directors as a member of the Board who has diverse insight, expertise, and capabilities for increasing the effectiveness of the decision-making and oversight functions of the Board of Directors, and thus the Company re-appointed him as an Outside Director.
Mari Matsunaga
[Outside Director]
Mari Matsunaga worked at Japan Recruit Center, Inc. (current Recruit Holdings Co., Ltd.) as Editor in chief of the magazines “Shushoku Journal” and “Travail.” She was appointed as Head of Planning Office for the Gateway Business Department at NTT Mobile Communications Network, Inc. (current NTT DOCOMO, INC.) where she developed content for i-mode. She has skills including senior leadership, risk and governance, human resources, as well as cultural skills based on her experience in developing new business models and as an outside officer at other company. She sufficiently possesses the insight, expertise, and ability required as a Director of the Company.
In particular, as an Outside Director, she has a high level of discontinuous growth skills due to her experience in new services and development. She can be expected to actively point out and make recommendations on management issues from the perspective of promoting open innovation, etc., and to actively provide opinions and recommendations at meetings of the Board of Directors based on her extensive knowledge and broad insight into the culture and lifestyles of modern society.
Accordingly, the Company deems that Mari Matsunaga is a human resource necessary to the composition of the Board of Directors as a member of the Board who has diverse insight, expertise, and capabilities for increasing the effectiveness of the decision-making and oversight functions of the Board of Directors, and thus the Company newly appointed her as an Outside Director.
Yutaka Kawakami
[Outside Audit & Supervisory Board Member]
Yutaka Kawakami has the expert knowledge related to accounting necessary for an Audit & Supervisory Board Member of the Company, and has a high level of insight for auditing management that comes from abundant audit experience in Japan and overseas, which were gained through activities over many years as an experienced certified public accountant who is well versed in accounting audits of global corporations. Furthermore, through active opinions and recommendations as an Outside Audit & Supervisory Board Member, he has provided appropriate auditing of the duties of the Directors of the Company. Accordingly, we deem that Yutaka Kawakami is a necessary human resource for strengthening the functions of the Company’s Audit & Supervisory Board in the aim for sustainable growth and enhancement of corporate value over the medium- to long-term, and thus the Company appointed him as an Outside Audit & Supervisory Board Member.
Shigeo Ohyagi
[Outside Audit & Supervisory Board Member]
Shigeo Ohyagi has extensive experience and exceptional insight into corporate management with respect to engaging in business globally, particularly given that he has served as president and chairman of global corporations. In particular, serving as an outside director and outside audit & supervisory board member in multiple leading Japanese companies, he appropriately performs roles that include analyzing potential risks, overseeing business execution and furnishing advice from a practical standpoint to verify potential business development, enlisting his fresh, objective and rational perspective.
The Company expects that in serving as Outside Audit & Supervisory Board Member he will appropriately perform the role of auditing the execution of duties by the Company’s Directors, including the internal control system, from an objective standpoint based on his knowledge and experience in corporate management. This will involve having him actively give his opinions and recommendations at meetings of the Board of Directors and the Audit & Supervisory Board, and also having him review the audit status of domestic group companies and activities of overseas group companies’ audit committees, etc.
Accordingly, we deem that Shigeo Ohyagi is a necessary human resource for strengthening the functions of the Company’s Audit & Supervisory Board in the aim for sustainable growth and enhancement of corporate value over the medium- to long-term, and thus the Company appointed him as an Outside Audit & Supervisory Board Member.
Sanae Tanaka
[Outside Audit & Supervisory Board Member]
Sanae Tanaka, through her long years of practice as an attorney at law, possesses expertise in corporate legal affairs necessary for an Audit & Supervisory Board Member of the Company and a high level of insight that enables her to audit management from the perspective of laws and regulations, etc.
The Company expects that in serving as Outside Audit & Supervisory Board Member she will appropriately perform the role of auditing the execution of duties by the Company’s Directors, including the internal control system, from an objective standpoint based on her extensive knowledge and experience as an attorney at law. This will involve having her actively give her opinions and recommendations at meetings of the Board of Directors and the Audit & Supervisory Board, and also having her review the audit status of domestic group companies and activities of overseas group companies’ audit committees.
Accordingly, the Company deems that Sanae Tanaka is a necessary human resource for strengthening the functions of the Company’s Audit & Supervisory Board in the aim for sustainable growth and enhancement of corporate value over the medium- to long-term, and thus the Company appointed her as an Outside Audit & Supervisory Board Member.

Nomination Committee and Compensation Committee

The Company established a Nomination Committee and a Compensation Committee as advisory bodies to the Board of Directors to ensure fairness and transparency in decision-making regarding officer personnel matters and officer compensation. The two committees are made up of Directors and Outside Directors.

The Nomination Committee reports to the Board of Directors when consulted on matters such as succession planning and candidates for directors and Audit & Supervisory Board Members. As of 28th of March 2023, the Nomination Committee comprises three Outside directors and two internal directors, and the Committee chairperson is an Outside Director elected by its members.

The Committee met 9 times in FY2022 and reported primarily on nomination of Director and Audit & Supervisory Board Member candidates, appointment of the Representative Director, Chairman of the Board, President, CEO, and chief officers (CXO), appointment of Nomination Committee members and the committee activity plan for FY2022.

The Compensation Committee reports to the Board of Directors when consulted on matters concerning remuneration structure and amount proposals regarding directors. As of 28th of March 2023, the Compensation Committee comprises three Outside directors and two internal directors, and the Committee chairperson is an Outside director elected by its members.

The Committee met 9 times in FY2022 and reported primarily on officer bonuses (annual and medium term) and allocation of points for stock compensation, appointment of members of Compensation Committee and the committee activity plan for FY2022.

Nomination Committee and attendance of members

  FY2018 FY2019 FY2020 FY2021 FY2022
Number of meetings 11 8 9 9 9
Members' attendance rate Average 90.9% 100% 100% 100% 100%
Christina L. Ahmadjian - - - - 100%
Kenichiro Sasae - - - - 100%
Tetsuji Ohashi - - - - 100%
Akiyoshi Koji 100% 100% 100% 100% 100%
Atsushi Katsuki - - - 100% 100%

The members were appointed in 2022 and 2023.

Compensation Committee and attendance of members

  FY2018 FY2019 FY2020 FY2021 FY2022
Number of meetings 12 9 5 10 9
Members' attendance rate Average 91.7% 100% 100% 96.0% 100%
Christina L. Ahmadjian - 100% 100% 100% 100%
Kenichiro Sasae - - - - 100%
Tetsuji Ohashi - - - - 100%
Keizo Tanimura - 100% 100% 100% 100%
Kaoru Sakita - - - - 100%

The members were appointed in 2022 and 2023.

Corporate Strategy Board

Corporate Strategy Board provides reports on its findings and views about evaluation of the legality, objectivity and reasonableness and of substantial matters concerning business execution in response to the inquiries referred from the President and Representative Director.

The Board consists of the President and Representative Director and other executive directors, Standing Audit & Supervisory Board Members and corporate officers and heads of each functions designated by the chairperson, and the President and Representative Director serves as its chairperson.

The Board held a total of 52 meetings during fiscal 2022, and provided reports on its findings and views primarily about development of corporate strategies and status of business executions by Group companies.

Global Sustainability Committee

The Global Sustainability Committee provides reports on its findings and views about the formulation and monitoring of sustainability strategies for the entire Asahi Group in response to the inquiries referred from the President and Representative Director.

The Committee consists of the President and Representative Director, the Director in charge of sustainability as well as CEOs of Regional Head Quarters etc., and the President and Representative Director serves as its chairperson.

The Committee held one meeting during fiscal 2022, intensively discussed and provided reports on its findings and views primarily about material issues in its sustainability strategy, “Communities” and “Responsible drinking.”

Information Disclosure Committee

Information Disclosure Committee is responsible for centrally managing and controlling corporate information disclosure, and provides reports on its findings and views in response to the inquiries referred from the President and Representative Director from the perspective of fair, expeditious and wide-ranging information disclosure. The Committee consists of the President and Representative Director and other executive directors as well as executive officers appointed by the committee chairperson, and the President and Representative Director serves as its chairperson.

The Committee held a total of 9 meetings during fiscal 2022, analyzed the contents of relevant information, and provided reports on its findings and views about the need or otherwise, contents, methods, etc. of information disclosure in light of the Timely Disclosure Rules, etc. of the Tokyo Stock Exchange.

Risk Management Committee

The Risk Management Committee provides reports on its findings and views on the promotion and supervision of risk management for the overall Asahi Group, in response to inquiries referred from the President and Representative Director. The Committee consists of the President and Representative Director and other executive directors, as well as executive officers who are appointed by the committee chairperson, and the President and Representative Director serves as its chairperson. Standing Audit & Supervisory Board Members also attend this Committee’s meetings.

The Committee held a total of 4 meetings during fiscal 2022, and provided reports on its findings and views primarily about identification and evaluation regarding major risks of the entire Group including tail risk (the risk of an event with a small probability of happening but could cause enormous losses if once happened), and action plans and the evaluation of the status of implementation in that regard, and improvement of a system to make a transition to crisis management without any disruptions at the outbreak of crisis.

Compliance Committee

The Compliance Committee provides reports on its findings and views on the promotion and supervision of corporate ethics and compliance for the overall Asahi Group in response to inquiries referred from the President and Representative Director, Compliance Committee consists of the President and Representative Director and other executive directors, as well as executive officers who are appointed by the committee chairperson, and the President and Representative Director serves as its chairperson. Standing Audit & Supervisory Board Members also attend this Committee’s meetings.

The Committee held a total of 4 meetings during fiscal 2022, and provided reports on its findings and views primarily about compliance promotion plans, the status of the Group’s compliance and the operational status of the whistle blowing system.

Internal Auditing

To effectively achieve the goals of internal control, the sections of the Company in charge of internal auditing cooperate with the internal auditing organization established within the Asahi Group conduct audits in accordance with our annual audit plans to determine whether operations are executed properly and efficiently.

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