ENEOS HOLDINGS, INC. 
By JX Holdings ("the Company") is aware that its mission is to contribute to sustainable economic and social development through creation and innovation in the fields of energy, resources, and materials. In addition, the Company is cognizant of the importance of promoting all its business activities as a fair and responsible player and maximizing its corporate value.
The basic approach to corporate governance of the Company is to make decisions and execute operational activities quickly and flexibly to implement growth strategies for the JX Group as a whole and make appropriate responses to changes in the business environment. In addition, the Company endeavors to secure the soundness and transparency of its management to respond to the trust and confidence from all its stakeholders.
As the holding company, JX Holdings focuses especially on formulating medium- to long-term strategies for the JX Group and strategically allocating management resources to implement these strategies. Under the holding company, the core operating subsidiaries are responsible for actual business activities in the JX Group in the Petroleum Refining and Marketing business, the Oil and Natural Gas Exploration and Production (E&P) business, and the Metals business.
The Board of Directors as a statutory body makes decisions and reports on matters stipulated in the related laws, including Companies Act, and the Articles of Incorporation as well the Rules for the Board of Directors. In principle, the meetings of the Board of Directors are held once a month. After due deliberation, the Board makes decisions on important matters and receives reports from other directors regarding the conduct of business activities.
Directors are elected for a term of one year and must be approved each year by the General Meeting of Shareholders. In addition, to strengthen the supervision of management from an independent and objective perspective, among the total of 14 directors, four outside directors are appointed, who are selected on the basis of their management insight and extensive experience. These four outside directors meet the criteria for independent officers of each of the stock exchanges on which the Company is listed--Tokyo, Osaka, and Nagoya.
In addition, the presidents of core operating subsidiaries are appointed as directors of the Company and, in the Board of Directors' meetings, they participate in deliberations and decision making with respect to business strategy for the JX Group as a whole.
Information Regarding Outside Directors| Name |
Position and important concurrent office | Reasons for election as outside directors and reasons for designating as independent directors |
|
Masahiro Sakata |
Independent Director Attorney-at-law; Of Counsel at Anderson Mori & Tomotsune | Mr.Masahiro Sakata has long worked forthe Ministry of Finance, and held positions such as the Director General of the Cabinet Legislation Bureau, as a result of which he has abundant expertise and experience in administrative and legal aspects. Therefore, the Company assesses that he is qualified to provide the Company with instructions and advice on its management, as well as supervising its management from an independent and objective perspective. |
|
Hiroshi Komiyama |
Independent Director Chairman of Mitsubishi Research Institute, Inc. | Mr.Hiroshi Komiyama specializes in chemical system engineering, functional materials chemistry, and global environment engineering, and has long been engaged in education and research at the University of Tokyo. In addition, he has advanced expertise and abundant experience in the management of a university, having served as President of the University of Tokyo. Therefore, the Company assesses that he is qualified to provide the Company with instructions and advice on its management, as well as supervising its management from an independent and objective perspective. |
|
Hiroko Ota |
Independent Director National Graduate Institute for Policy Studies, Professor | Ms.Hiroko Ota specializes in public economics and economic policies, and has long been engaged in education and research at the National Graduate Institute for Policy Studies. In addition, she has held positions such as Director General for Economic Research in Cabinet Officeand Minister of State for Economic and Fiscal Policy, as a result of which she has abundant expertise and experience regarding the economy and finance. Therefore, the Company assesses that she is qualified to provide the Company with instructions and advice on its management, as well as supervising its management from an independent and objective perspective. |
| Mutsutake Otsuka |
Independent Director Advisor of East Japan Railway Company | Mr.Mutsutake Otsuka has long been engaged in the management of East Japan Railway Company;as a result, he has acquired deep insight into, and abundant experience and solid accomplishments in company management. Therefore, the Company assesses that he is qualified to provide the Company with instructions and advice on its management, as well as supervising its management from an independent and objective perspective. |
Under the Companies Act, the Rules for the Board of Corporate Auditors and Auditing Standards for the Corporate Auditors, the Board of Corporate Auditors prepares systems for comprehensively conducting audits by the corporate auditors and routinely audits the status of operational execution by the directors. Reports are made regarding the progress and results of audits of matters for which each corporate auditor is responsible at the regular meetings of the Board of Corporate Auditors, which are held once each month; these results are shared among the corporate auditors.
To enhance the effectiveness of audits, the corporate auditors attend the meetings of the Board of Directors and the Executive Council as well as other important meetings and express their opinions as deemed necessary. In addition, the corporate auditors work to ascertain the conduct of business activities of officers and employees by reading through important documents and conducting interviews with officers and employees of the Company and its subsidiaries. Furthermore, the corporate auditors receive auditing plans, progress reports on auditing activities, and information on results as well as other matters from the Internal Audit Department, and the independent auditors periodically and exchange opinions and information with them. In addition, full-time corporate auditors of the Company serve as auditors of the core operating subsidiaries of the JX Group.
Among the total of six corporate auditors, four outside corporate auditors, who constitute the majority, are appointed on the basis of their deep management insight and extensive experience. Within this structure, under Japan's Companies Act, which has strengthened and expanded the authority of the corporate auditors and the Board of Corporate Auditors, the Company secures the effectiveness of their audits. All of the four outside corporate auditors meet the criteria for independent corporate auditors of each of the stock exchanges on which the Company is listed Tokyo, Osaka, and Nagoya.
To further upgrade the auditing functions that are performed by all the corporate auditors, the Auditors' Affairs Office has been established as an organization that is independent from the business execution sections. Dedicated staff are assigned to this office to assist the auditors in the conduct of their duties.
| Name |
Position and important concurrent Office | Reasons for election as outside corporate auditors and reasons for designating as independent auditors |
|
Hiroyasu Watanabe |
Independent Auditor Professor of Graduate School of Finance, Accounting and Law, Waseda University | Mr. Hiroyasu Watanabe served in key positions in the Ministry of Finance, including Director General of the National Tax Agency, and subsequently became a professor in the graduate schools of Waseda University and the University of Tokyo. Therefore, he has sophisticated and specialized know-how and deep insight into corporate management. He was elected as an outside corporate auditor because from his objective, outside, and fair perspective, he is able to audit the management of the Company in the conduct of its duties. |
|
Mitsudo Urano |
Independent Auditor Representative Director and Chairman of Nichirei Corporation | Mr. Mitsudo Urano served in the management of Nichirei Corporation for many years and has strong insight into corporate management, extensive experience, and a solid record of accomplishments. He was elected as an outside corporate auditor because from his objective, outside, and fair perspective, he is able to audit the management of the Company in the conduct of its duties. |
|
Hideki Nakagome |
Independent Auditor Attorney-at-law, Partner at Fuji Partnership Law Office (Fuji Godo Houritsujimusho) | Mr. Hideki Nakagome has long worked as a judge, serving as the president of the Mito District Court and the president of the Nagoya High Court and later served as a committee member of an independent panel of a company in the capacity of an attorney. Therefore, he has extensive specialized knowledge and experience regarding legal and corporate governance. He was elected as an outside corporate auditor because from his objective, outside, and fair perspective, he is able to audit the management of the Company in the conduct of its duties. |
| Toshinori Kanemoto |
Independent Auditor Attorney-at-law, Of Council at City-Yuwa Partners | Mr.Toshinori Kanemoto has long worked for the National Police Agency, serving in such important positions as the President of International Criminal Police Organization(ICPO), and the Director of Cabinet Intelligence of Cabinet Secretariat, and later served as the compliance committee chair of a major company in the capacity of an attorney, as a result of which he has abundant expertise and experience regarding corporate legal affairs and compliance. Therefore, the Company assesses that he is qualified to audit the execution of duties by the directors from an objective, independent and fair stance. |
Executive Officers are appointed and are responsible for operational execution, based on the authority of the Board of Directors.
Matters to be decided by the Board of Directors must, in principle, be approved by the president in advance. The Executive Council has been formed to discuss matters related to operational execution that require the approval of the president. This council is composed of full-time directors, the presidents of core operating subsidiaries, and other executive officers, and it is convened periodically and at other times when deemed necessary. Thus, at the Executive Council, through team discussions and deliberation by executive members of the Company and the core operating subsidiaries, appropriate and efficient decisions by the president are secured.
Our internal control system works to ensure appropriate operational execution. In regard to the operation of this system, the Internal Control Council has been established to provide advice to the president to implement the system on a Groupwide basis. This council, which is composed of the same members as the Executive Council, confirms and reviews the results of the annual monitoring of the operation of the system and proposes an enhanced plan for the next year's operation of the autonomous self-control systems.
To ensure the transparency and objectivity of the process of determining the compensation and other benefits for directors and executive officers, the Compensation Advisory Committee has been formed to provide advice to the Board of Directors. The Compensation Advisory Committee comprises two outside directors and two representative directors, and one of the outside directors on the committee acts as chairman. The Compensation Advisory Committee is responsible for deliberating the policies for deciding the compensation and other benefits of directors and executive officers as well as other related matters. The results of the committee's deliberations are reported to the Board of Directors.
Executive CompensationThe total amount of compensation to be paid to directors and corporate auditors was decided at the first Ordinary General Meeting of Shareholders held on June 27, 2011.
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The total amount of compensation for all directors: Equal to or less than ¥1,100 million (inclusive of compensation to outside directors equal to or less than ¥200 million) in one fiscal year. If directors also hold positions as employees, the salary and bonuses to be paid in compensation for these services are not included.
- The total amount of compensation for all corporate auditors: Equal to or less than ¥200 million in one fiscal year.
Compensation paid to directors is divided into two components. The first component is basic compensation, which is determined in consideration of the roles undertaken by individual directors and paid in fixed amounts each month. The second component is in the form of a bonus, which varies according to the level of consolidated ordinary income, and, therefore, reflects performance during the relevant fiscal year. The policy for the determination of this compensation is for the decision to be made by resolution of the Board of Directors after deliberations and reporting by the Compensation Advisory Committee. Compensation paid to corporate auditors is fixed in consideration of the independence of their duties. Based on the deliberations of the corporate auditors, this compensation is paid within the limits stated above.
