Compliance Initiatives
Compliance Initiatives
To put our Corporate Philosophy into practice and be a company trusted and loved by customers and society, the KONOIKE Group must comply with laws, ordinances, and social norms, as well as conduct business fairly and transparently. To this end, we established a Corporate Ethics Code. Under this code, we further defined a Compliance Code and Operational Regulations on the Konoike Reporting Desk (Helpline), which we use to ensure compliance with and practical application of the Corporate Ethics Code. These measures guide our efforts to raise compliance throughout the Group.
In addition, on May 30, 2025, we announced our Management Quality Declaration, which, in addition to returning to our founding philosophy, communicates our commitment to compliance with an eye toward the future for the next 50 to 100 years.
Internal Compliance Training
Compliance education is provided to employees in career-track positions during their annual training and employment-gradespecific training. During each training, we reiterate our Basic Philosophy, explain case studies of wrongdoing and misconduct within and outside the Group, discuss observations made by government agencies, and work to raise employee awareness of ethics. Our goal is to be a good corporate citizen, acting with integrity toward all stakeholders in a way that is ethical and in accordance with accepted social values and norms. In addition, the scope of e-learning has been expanded to include front-line employees and Group company employees, and compliance-related courses have been offered to raise Group compliance awareness.
Initiatives for Overseas Subsidiaries
We must promote the KONOIKE Group’s philosophies to overseas subsidiaries, where business practices differ from those in Japan. In addition to providing compliance education through e-learning, we measure the workplace climate and employee attachment at each local subsidiary. This is done by conducting surveys to gauge compliance awareness and employee engagement at each location. We also work to improve engagement through various initiatives, an example of which is Katariba. We also hold study meetings on our corporate ethics code for managers and promote the thorough enforcement of the Basic Philosophies of maintaining safe and pleasant workplaces, contributing as a good corporate citizen, caring for the environment, and engaging in fair trade.
Internal Reporting System
The KONOIKE Group offers the Konoike Reporting Desk (Helpline) as an internal reporting system. In addition to this internal helpline, we also offer access to a law firm as an external reporting point for employees who may be nervous about filing an internal report. Depending on the nature of the case, a member of the Audit & Supervisory Board may receive a report. In this event, the member will contact the department in charge to investigate the matter. Though report contents are submitted to the Board of Directors via the Internal Control Committee, the Internal Control Committee promptly reports to individual directors on particularly important or urgent matters for action. We have also introduced internal reporting systems at some locations outside Japan, planning to gradually expand these reporting channels.
Internal Control Committee
In the past, the activities of the Internal Control Subcommittee, headed by the executive general managers of the Finance/Accounting Division and the Corporate/Quality Division, were limited to information sharing on internal control deficiencies that occurred in the course of business operations and horizontal deployment. As a result, a case of misconduct occurred in 2023, and since April 2024, the Management Quality Council, headed by the President and Chief Executive Officer, has been working on measures to prevent recurrence. In the course of these efforts to prevent recurrence, we determined that there was insufficient involvement in compliance by senior management. We therefore formed an Internal Control Committee, chaired by the President and Chief Executive Officer and composed of all division executive general managers, and positioned it as an advisory body to the Board of Directors. In addition to the maintenance, operation, evaluation, and response to issues related to our internal control system, the committee also shares the details of reports to our reporting desk and promptly reports those of high importance and urgency to directors, thereby avoiding potential compliance risks.
Role
The Internal Control Committee is responsible for internal control matters, including planning of internal control, evaluation of maintenance and operation status and response to issues, as well as monitoring the performance of the Konoike Reporting Desk and responding to cases that require Company-wide action and to cases involving compliance risks reported by each department. For matters of particular urgency or importance, we plan to promptly coordinate with individual directors to handle each case. In addition, the Internal Control Promotion Subcommittee, consisting of branch managers and affiliate representatives, is a subordinate body designed to accurately disseminate the matters discussed by the Internal Control Committee to business units, and leads internal control and compliance activities for the entire Group.
Composition
Chair: President and Chief Executive Officer
Vice-Chair: Senior Managing Executive officer in charge of corporate affairs
Members: Senior managing executive officers, all general managers, full-time Audit & Supervisory Board members, general manager of the Internal Auditors Office
Outside members: One attorney and certified public accountant
Compliance Department Organization Chart
