The Corporate Ethics and Compliance Committee, inaugurated in 2004, is a body of executives and representatives from each headquarters/product group that operates under the chairmanship of the President of Canon Inc. The Committee meets four times a year to discuss and approve compliance and corporate ethics policy and measures for the Canon Group. In light of the nature of the Committee, a corporate auditor attends the meetings as an observer.
The primary objectives of the Corporate Ethics and Compliance Committee are: 1) to instill a consciousness of compliance and ethics universally throughout the Group, and 2) to enhance the transparency and soundness of business activities while fostering a corporate spirit that motivates employees to unfailingly consider compliance and ethics when making business decisions.
In addition to the regular members, once a year the Committee also invites the presidents of regional headquarters worldwide and all the presidents of Group companies in Japan to attend meetings. In 2006, the expanded committee reached a consensus on how to prevent scandals; each member of top management must have a clear grasp of on-site situations and, if a compliance-related issue arises, play a lead role in solving it. Canon is working as a group to thoroughly implement corporate ethics and compliance.
Expanded Corporate Ethics and Compliance Committee
The Internal Control Committee was established in 2004 to oversee the internal control structures and activities for the Group. All top executives of Canon Inc. and the top management of all Group companies serve on the committee under the chairmanship of the President of Canon Inc.
The Committee’s main task is to ensure the reliability of financial reporting by SEC filers under Section 404 of the Sarbanes-Oxley Act* of 2002. It also conducts comprehensive reviews of the Group’s internal control measures as a way to verify the true effectiveness and efficiency of the Group’s business operations and support compliance with all related laws, regulations, and internal rules.
Ahead of the 2006 application of Section 404, the committee concentrated on strengthening and improving specific operational processes and documentation related to ensuring the reliability of financial statements. As a result, we concluded that the Group’s internal control over financial reporting related to Section 404 was effective. Looking ahead, the committee will work to raise its activity levels still further by creating a system to maintain and manage these processes and documents with a view to establishing a more efficient operational flow.
Major working themes of the Global Legal Affairs Coordination Committee, established in 1987, involve correspondences to various major legal regulations worldwide. Working groups formed around each of these themes investigate and analyze related issues, form guidelines and publish guidebooks on legislative movements (IT, the environment and China), raise the level of companywide awareness of legal issues facing the Group, and support the relevant divisions at Group companies in their responses to legal issues.
The committee’s recent activities include full-scale preparations for the implementation of the EU’s REACH effective from June 2007.
Principal Working Themes of the Global Legal Affairs Coordination Committee
In 2005, we established the Disclosure Committee, which is chaired by Canon Inc.’s president. The committee’s purpose is the swift, accurate and comprehensive disclosure of important company information, in accordance with related laws and regulations, and stock exchange rules. Division personnel who are in charge of the information disclosure working group report to this committee information that requires timely disclosure.
