ELECOM's ESG Initiatives

Governance

Corporate governance

Policy and Basic Approach

The ELECOM Group's fundamental policy for its corporate governance is to increase the efficiency, transparency, and independence of management from the standpoint of its shareholders and other stakeholders to maximize corporate value.
ELECOM has adopted an Audit & Supervisory Board system for its corporate governance, and believes that it is of paramount importance to maintain structures that enable the monitoring of management with an emphasis on the efficiency and legality of the Board of Directors and the Audit & Supervisory Board. In addition, Internal Control System will be promoted with emphasis on management efficiency, reliability of financial reporting, and compliance, and will be mutually linked with corporate governance initiatives to ensure the effectiveness of each.

Fiscal year Initiatives
2025 Establishment of Risk Management Committee
2023 Strengthened assessments regarding Board of Director effectiveness
Established Nomination Committee and Compensation Committee
Adopted Executive Officer system
2021 Inclusion of women on the Board of Directors

Corporate governance framework

Besides the Board of Directors and Audit & Supervisory Board, ELECOM has established systems or meeting forums to ensure appropriate and efficient execution of business as follows.

○Executive Officer System
To speed up business execution, we have adopted the Executive Officer System. Executive Officers are responsible for business execution in accordance with the basic policy decided by the Board of Directors. There are nine Executive Officers (of those, four concurrently serve as Executive Directors) as of June 30, 2026, and their terms are one year, the same as for Executive Directors. There are currently zero female Executive Officers.
○Executive Committee
The Executive Committee is chaired by the Director and President, with members drawn from internal Directors and Executive Officers, and meets once a month in principle. In accordance with the basic policies, plans, and strategies decided by the Board of Directors, it deliberates policy on important matters for the execution of business by Executive Officers.
○Nomination Committee and Compensation Committee
The Committee, a majority of which consists of external Directors, deliberates on the appointment and dismissal of Executive Directors and Audit and Supervisory Board Members as well as their remuneration, furnishes their opinions to the Board of Directors, and gives advice and recommendations as an advisory body to the Board of Directors, with the aim to contribute to the development of appropriate corporate governance and to help ensure the transparency of management. After being established in July 2023, the Committee met three times in the fiscal year under review.
○Risk Management Committee
The Risk Management Committee is chaired by the Director and President, with members consisting of executive officers and general managers of departments. It systematically and comprehensively identifies and evaluates risks inherent in our company and group during normal times, enabling corrective actions at an early warning stage and swift responses when risks become apparent. This aims to achieve sustainable growth and enhance corporate value over the medium to long term.
○Sustainability Committee
The Sustainability Committee consists of internal Directors and division managers. It works to improve business activities from the standpoints of reducing risk and creating opportunities with the goal of long-term growth for the Company and society as a whole. The Sustainability Committee works alongside each committee to minimize the risks of managerial and operational issues.
○Compliance Committee
The Compliance Committee consists of internal Directors and division managers. It checks on the maintenance and operation of internal control systems, and furthermore makes decisions on measures to prevent recurrence when important incidents involving compliance arise.
○Quarterly Business Meeting
Attended by internal Directors including the Representative Director and President, the Quarterly Business Meeting is held so that managers of the Sales Division can quarterly share details on progress made toward achieving targets and corporate strategy.
○Internal audit section
The purpose of the internal audit section is that of helping to bring about improvement of business affairs and increasing managerial efficiency, serving as an organization that is independent of executive bodies.
▶Corporate governance framework (as of June 30, 2026)
◀ The figure can be scrolled
Figure of Corporate governance framework

Roles of the Board of Directors

ELECOM positions the Board of Directors as a body to decide basic policy and strategy for group management, to decide items related to important business execution, and to oversee business execution. In principle, the Board of Directors holds regular meetings once a month and extraordinary meetings as necessary. It makes decisions on matters stipulated by law and on important matters related to management, and supervises business execution. The Board of Directors is currently composed of nine members, of which four are external Directors (as of June 30, 2026), and chaired by the Representative Director and President.
In addition, important business transactions between ELECOM and its Executive Directors, Audit & Supervisory Board Members, their close relatives, and other related parties are deemed matters to be resolved by the Board of Directors, which adequately deliberates on appropriateness thereof. Business transactions involving conflicts of interest between ELECOM and the Executive Directors would be gained approval of the Board of Directors.

○Initiatives to improve assessment
We strive to improve assessment at meetings of the Board of Directors through ensuring sufficient time for deliberation of respective proposals by presenting only those matters that are of high priority according to internal rules, and seeking active discussion encompassing external Directors by providing information prior to such meetings.

Policies and procedures regarding appointment and dismissal of Executive Directors

Executive Directors are elected by a resolution of the General Meeting of Shareholders, and their term of office runs until the conclusion of the Annual General Meeting of Shareholders for the last fiscal year ending within one year of their election. With respect to appointment and dismissal of Executive Directors, the company appoints Executive Directors who strive to achieve ideals of our purpose, in a fair and appropriate manner. This entails comprehensively reviewing candidates from the perspective of appointing the right person to the right position in terms of ensuring precise and swift decision-making by the Board of Directors, appropriately managing risk, monitoring business execution, and striking a balance in facilitating coverage of respective corporate functions and each business division.
In addition, the Nomination Committee has been established as an advisory body to the board of directors, which deliberates the following: (1) Matters related to the appointment and dismissal of Executive Directors and Executive Officers, and (2) Matters, etc. related to the selection and dismissal of Representative Directors and Directors with Specific Titles. This advisory body will continue to operate from an objective perspective as it works to enhance the transparency of the process for deciding nominations, as well as considering the selection of candidates.

Diversity of Executive Directors

As of June 30, 2026, ELECOM has nine Executive Directors, of whom four are external Directors (44% of the Executive Directors) and one is a woman (11% of Executive Directors).
Each of the external Directors is a professional capable of furnishing useful and appropriate advice and suggestions from a standpoint of independence and objectivity with respect to overall management, and is accordingly equipped with abundant experience and in-depth insight with respect to corporate management and corporate governance.
Moreover, all four of the external Directors have been designated as independent officers, upon having deemed that they pose no risk involving conflict of interest with general shareholders and accordingly satisfy the standards of independence stipulated by the stock exchange.

Roles of Audit & Supervisory Board Members and the Audit & Supervisory Board

The Audit & Supervisory Board consists of three members, including one full-time Audit & Supervisory Board Member, all of whom are external Audit & Supervisory Board Members. (As of June 30, 2026) In principle, the Audit & Supervisory Board meets once per month and extraordinarily as necessarily.
The Audit & Supervisory Board Members engage in tasks that include attending meetings of the Board of Directors, furnishing opinions as necessarily, listening to the status of business execution as appropriate from Executive Directors and the internal audit section, conducting investigations of important approval documents and financial statements, and auditing the adequacy and legality of Executive Directors' execution of business.

Policies and procedures regarding appointment of Audit & Supervisory Board Members

With respect to appointment and dismissal of Audit & Supervisory Board Members, the Company appoints persons who possess certified public accountant, tax accountant, attorney at law and other such qualifications, and who contribute to developing frameworks for establishing corporate ethics of the ELECOM Group from the perspective of risk management, compliance, and accountability by respectively engaging in managerial oversight from the perspective of professional ethics.
Furthermore, while taking into consideration the basic policy on the appointment and dismissal of Audit & Supervisory Board Members, to be formulated and proposed by the Nomination Committee (planned to be established in August 2023), and the abundant experience of the Audit & Supervisory Board Members, we are promoting efforts to ensure the establishment of an organization that can be expected to conduct audits from a neutral and objective perspective and based on a company-wide view.

Assessments regarding Board of Director effectiveness

In order to continuously improve the functionality of the Board of Directors, ELECOM has been implementing the assessments regarding the Board of Director effectiveness since April 2023.

○Assessment method
Self-assessment questionnaires are completed annually by all Executive Directors and Audit & Supervisory Board Members, with the results reported to and discussed by the Board of Directors. (Twice a year)
<Questionnaire items>
A 5-point scale evaluation method is used for each question, and space for free expression of opinion is provided for each
Contents of questions: Composition of Board of Directors; operational status of Board of Directors; status of discussions by the Board of Directors; role and function of the Board of Directors; Execution of duties by Executive Directors and Audit & Supervisory Board Members themselves; support to Executive Directors and Audit & Supervisory Board Members; overview
○Initiatives to enhance effectiveness
In FY2025, based on the results of the assessments regarding the Board of Director effectiveness and the opinions of external Directors, we reviewed the decision-making process and organized agenda items to improve the quality and efficiency of deliberations within the Board of Directors. This has enabled us to establish a system that allows the Board of Directors to focus more on its essential supervisory functions and medium- to long-term strategic discussions.
○Further initiatives
We will continue to address issues that require medium- to long-term improvement, such as enhancing discussions on medium- to long-term management strategies. Additionally, we will continuously monitor progress in improvement through annual surveys.

Remuneration, etc. of Executive Directors and Audit & Supervisory Board Members

○Policy for making decisions
With respect to remuneration for Executive Directors, the Company has established a basic policy of opting for competitive remuneration levels and remuneration structures upon taking into account the need to secure competent Executive Directors who are suited to such responsibilities in order to achieve the aim of sustainably improving corporate business performance and corporate value over the long term.
Specifically, such remuneration consists of a combination of:
  1. basic remuneration aligned with an Executive Director's position, responsibilities, years of service and other such criteria, and;
  2. share-based remuneration (stock options, restricted share remuneration) for the purpose of achieving greater corporate value over the medium to long term and encouraging a sense of shared value with shareholders.
Meanwhile, remuneration for external Directors is excluding any linkage to business performance given the nature of external Directors' professional duties, and accordingly limited to that of basic remuneration paid in alignment with position.
Basic remuneration is paid as fixed monetary remuneration on a monthly basis.
The Company considers the prospect of providing stock options annually at a specified time in view of business performance.
Restricted share remuneration is provided annually at a specified time. Transfer restrictions are to be lifted upon retirement.
Basic remuneration, stock options, and restricted share remuneration are provided at a ratio of approximately 8:1:1.
Moreover, the Company verifies and deliberates on whether remuneration levels and remuneration structures are appropriate in reference to results of executive compensation surveys mainly among listed companies conducted by external research organizations, and also in reference to salaries of the Company's highest-ranking employees. Such findings are then submitted to the Board of Directors for deliberation.
Decisions on remuneration for Audit & Supervisory Board Members are made based on discussions involving the Audit & Supervisory Board Members, but their remuneration is excluding any linkage to business performance given the business nature of auditing, and accordingly limited to basic remuneration paid in alignment with position.
Furthermore, the Company established a Compensation Committee as an advisory body to the Board of Directors (in August 2023). Based on policies, etc. on the design and management of the remuneration system formulated and proposed by the Compensation Committee, we are working to promote a system for ensuring transparency that is more objective.
○Decision-making procedure
ELECOM makes payment of remuneration based on remuneration standards approved by the Board of Directors, of amounts within the scope of total remuneration amounts that have been approved at the General Meeting of Shareholders. In addition, because share acquisition rights are granted in the form of stock options, a portion of remuneration is derived from share price volatility.

Internal control

Internal control systems

The ELECOM Group prescribes that compliance and risk management are one of its priorities, and has accordingly established basic guidelines for developing internal control systems to ensure that the operations of each organization within its Group companies are carried out legally, appropriately, and efficiently. We furthermore promote overall risk management by overseeing compliance initiatives, having stipulated organizational regulations and rules on committee practices, and having also established the Internal Control Promotion Committee situated at the center of its framework for promoting development of internal control systems of the ELECOM Group.
We submit such evaluation findings to the Prime Minister of Japan in internal control reports prepared based on internal control reporting systems under Japan's Financial Instruments and Exchange Act, and furthermore disclose such findings to our shareholders and other investors. Going forward, we will continue to appropriately maintain and operate our internal control systems in accordance with relevant standards and in alignment with changes in the business environment.

Tax transparency

Policy and Basic Approach

The ELECOM Group complies with laws and regimes related to taxation in respective nations and regions, aspires to minimize tax risk, and strives to increase corporate value. We also aim to act as a truly global company, which involves fulfilling our corporate social responsibility by monitoring developments with respect to international taxation frameworks and appropriately addressing such changes.

Tax policy
  1. The ELECOM Group engages in tax planning in a legal, appropriate and efficient manner. We regard taxation as an important element of business planning and accordingly use tax incentive schemes available to us within the realm of our normal business activities. However, we do not engage in transactions whose main purpose is that of tax avoidance and are not associated with business realities.
  2. The ELECOM Group minimizes its exposure to tax risk to the extent possible when dealing with issues of taxation. We also identify assess and manage tax risk in respective nations and regions in order to minimize such risks, and accordingly seek external advice when encountering significant uncertainties or complexities regarding risk.
  3. The ELECOM Group develops and maintains positive relationships of trust with tax authorities in respective countries and regions by submitting tax-related information in a timely and appropriate manner.
    In the event that concerns are identified, we immediately take corrective action to prevent recurrence of such situations, except when it is necessary to file an objection to actions and opinions of the tax authorities.

Tax management system

ELECOM's Chief Financial Officer (CFO) provides instructions on the basic policy for appropriate performance of tax obligations, and the General Manager of Accounting Department and the Accounting Department coordinate with related departments in performance of tax affairs in accordance with the instructions from the CFO. In cases where a material tax-related event or risk is recognized, the General Manager of Accounting Department and the Accounting Department provide timely reports to the CFO, the Executive Committee, and the Board of Directors.

○Tax amounts by country ELECOM Group in FY2025

  • Japan: 4,695 million yen
  • Overseas: 402 million yen

Risk management

Policy and Basic Approach

The ELECOM Group strives to gain the trust of its stakeholders over the long term. To this end, our basic risk management policy is to identify risks, prevent them from materializing, and ensure through compliance. The ELECOM Group promotes risk management by identifying risks at each Group company, planning a response to address such risks, and monitoring progress in implementation in that regard. We have established a "Risk Management Committee" aimed at systematically and comprehensively identifying and evaluating various risks during normal operations, enabling corrective actions at an early warning stage and swift responses when risks materialize, thereby promoting sustainable growth and enhancing corporate value in the medium to long term. We are further strengthening our organizational structure.

Risk management system

The ELECOM Group recognizes that risks affecting management are diversifying and becoming more complex due to changes in the business environment and the advancement of globalization. In light of this situation, we established the "Risk Management Committee" in FY2025 to further enhance our risk management system.
This committee is chaired by the Representative Director and President and is primarily composed of Executive Officers, with the Human Resources and General Affairs Department serving as the secretariat. The committee promotes the comprehensive and systematic identification of risks across the entire group, the identification of key risks, the formulation of countermeasure plans, and the monitoring of progress in implementation in an integrated manner. Furthermore, we strive to prevent major incidents by early detection and correction at an early warning sign of inappropriate accounting practices, information security issues, product and transaction quality problems, compliance violations, reputation risks, and more. The status of key management risks is regularly reported to the Board of Directors, contributing to the strengthening of governance across the Group and to its sustainable growth.

Risk management related to business operations

○Business Continuity Plan (BCP)
The ELECOM Group has drawn up a Business Continuity Plan (BCP) with the aim of resuming and continuing important business of the company within requisite periods of time even in the event of a disaster, accident, cyberattack or unforeseen circumstances otherwise.
We also engage in business continuity management (BCM) for the sake of consistently implementing and assessing measures, education and training stipulated under the BCP, continuously improving and maintaining the BCP.
In response to unforeseen circumstances, we have a system headed by the President, with the secretariat role being handled by the Human Resources and General Affairs Department in the event of a disaster, and by the Digital Promotion Department in the event of a cyberattack, ensuring initial response and coordination with internal and external parties according to the situation. Moreover, to promote awareness and understanding of the BCP, we conduct an annual briefing session on BCP measures for management and several safety confirmation drills each year.
We also maintain basic guidelines for fulfilling our responsibility to supply products to our business partners and to sell inventory to our suppliers even in the event of a major earthquake or other such natural disaster, while protecting lives and ensuring safety of our employees and their family members, with the aim of otherwise meeting the expectations of our stakeholders. In FY2025, we prepared for the appropriate handling of public relations in the event of unforeseen circumstances by identifying relevant risks, formulating a Crisis Management Public Relations Manual, and setting up training framework.

Risk response at logistics locations

The ELECOM Group has logistics centers in the east and the west of Japan that support the Group's supply chain, with optimal locations for the logistics centers selected from the standpoint of the BCP, including climate change and earthquake risk.
In March 2022, we relocated the West Japan Logistics Center, a logistics facility owned by ELECOM and DX Antenna, from the Osaka Prefecture's coastal region to the interior of Hyogo Prefecture, and the Center began real operations in April 2022. At this facility, we focus on labor-saving and automation to address the reduced labor force. With the introduction of our shuttle-type multi-level automated warehouse system "Systema Streamer SAS-R System,"which includes the automation of product sorting using a cross-belt sorter, we succeeded in realizing the Goods to Person (GTP) concept whereby goods are brought to where people are, and we worked to reduce the workload for laborers and greatly increase productivity through ultra-high-speed picking. This technology enables "logistics without walking" and represents innovation in logistics from a labor-intensive style to a process-industry style. This innovation also ensures greater safety for warehouse workers than ever before, resulting in a more pleasant working environment. Furthermore, to respond to rapid changes in the market including the increase in e-commerce demand, we have expanded our logistics capabilities including strengthening small-scale deliveries in conjunction with the logistics center.
We will continue to position logistics as one of our management strategies, and in addition to working with each division to pursue operational efficiency, we will address various issues starting with the 2024 issue, which is an issue affecting the logistics industry in a way that transcends boundaries between sectors, with a sense of urgency.

Photo of Hyogo Logistics Center, ELECOM Photo of Cross-belt sorter

Information security initiatives

The ELECOM Group regards the task of ensuring information security as one of its key challenges when engaging in business activities. As such, we accordingly establish rules to such ends and manage information in a manner appropriately aligned with prevailing risks. We take extra precautions when it comes to safeguarding personal information of our customers.
We also monitor changes in risk and maintain high levels of security.

○Information security measures
In response to the increasing sophistication of cyber-attacks, we are establishing a multi-tiered defense system. Moving forward, we aim to achieve zero-trust security by building a centralized management platform for IDs and access permissions, and implementing the following controls:
  • - Centralized management of IDs across multiple cloud services
  • - Immediate modification/invalidating of permissions for transferred or departing employees to prevent unauthorized access
  • - Issuing only the minimum necessary IDs and recording and storing all logs to improve management and tracking efficiency
○Measures for personal information protection
As a business operator handling personal information, the ELECOM Group has a duty to ensure that it is appropriately protected, and it has set out a policy for handling and appropriate protection of personal information that applies to all individuals, whether customers or business partners, who provide personal information to the company.
▶ https://www.elecom.co.jp/privacy/ (in Japanese*)

*ELECOM Japan website in Japanese This link provides an introduction in Japanese on the ELECOM Japan website. Cookies and similar technologies may be used in accordance with ELECOM Japan’s Website Privacy Policy (in Japanese).

○Education on information security
We are further strengthening annual information security training by focusing on cyber-attack defense and phishing email through recurring awareness emails, striving to enhance the organization's overall risk response capabilities.
○Acquisition of official certifications
The state of acquisition of the information security management system ISO/IEC 27001 is as follows.
◀ The table can be scrolled
Management system Company name Date of initial registration Business offices Description
ISO/IEC27001 Logitec INA Solutions September 22, 2008 Data Recovery Technology Center
ISO/IEC27001 groxi December 16, 2013 Head office

Initiatives of the internal audit

The ELECOM Group has established an internal audit team within ELECOM, which draws up annual audit plans and implements internal audit processes that cover the Group as a whole. The internal audit team aims to help bring about improvement with respect to operations and managerial efficiency, serving as an organization that it is independent of executive bodies pursuant to the internal audit regulations. The internal audit team is in charge of the Secretariat of the Internal Control Promotion Committee and the contact point for whistleblowing with respect to internal control systems.
The team conducts internal audits from the perspective of compliance and appropriateness regarding laws and regulations, and internal rules from the perspective of operational effectiveness and efficiency. The team furthermore confirms implementation of improvement measures and performs follow-up audits, while furnishing advice on improvements to divisions subject to audit pursuant to internal audit findings, and reports to the Representative Director and President and relevant officers and employees. Meanwhile, internal audit teams maintain regular contact with the full-time Audit & Supervisory Board Members, strive to improve efficiency and effectiveness of audits by exchanging information and opinions on audit policies, audit plans, and audit findings, and ensure cooperation with the Audit & Supervisory Board. Moreover, ELECOM has established a contact point for whistleblowing in accordance with its regulations on whistleblower protection. The Internal audit section coordinates with relevant departments to conduct investigations or audit activities as required regarding internal control systems or whistleblowing reports.

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