Guidelines and Protection Policies for Minority Shareholders in Transactions with Controlling Shareholders
- The terms and conditions of transactions with controlling shareholders are determined rationally through prescribed procedures, taking into consideration contract terms and market prices, as in the case of transactions with other companies.
- In order to establish an effective governance system to protect the interests of minority shareholders, one third of the independent outside directors appointed by the Board of Directors are independent from the controlling shareholder.
- The Company has established the Special Committee (chaired by an independent outside director) and consisting solely of independent outside directors to deliberate and review important transactions and actions that may conflict with the interests of the controlling shareholder and minority shareholders. In principle, the meeting is held once a quarter, and extraordinary meetings are held as necessary.
Views on Independence from the Parent Company
Of the parent companies, the company that is deemed to have the greatest impact/influence on the Company is LY Corporation and it is a major business partner of the Company.
The Company has invited a person with extensive experience and knowledge in the internet business world from their time at LY Corporation to serve on the Company’s Board of Directors, and has received advice and recommendations from said Director to help streamline our business operations.
The Company provides services to and purchases services from LY Corporation. Terms and conditions of service provision and procurement are determined in the same manner as general terms and conditions of transactions or through negotiation, taking into consideration market prices and the consignment details, etc
In order to ensure independence from the parent company, the Company has established in its Table of Authority, the procedures for resolutions and reporting by the Board of Directors regarding transactions with the parent company and other companies that have the same parent company as the Company, that may exert significant influence on the Company. The Company’s Board of Directors fully deliberates and confirms the reasonableness of transactions and the appropriateness of the terms and conditions of important transactions with the parent company’s corporate group.
Since there are no business restrictions from the parent company and the Company is in a position to make its own management decisions, we believe that a certain degree of independence from the parent company is ensured. In addition, we view collaboration with the parent company group as a business opportunity for the Company, and we believe that it helps the Company achieve a competitive advantage over our competitors.
In addition, the Company has established the Special Committee (chaired by an independent outside director) consisting solely of independent outside directors as an advisory body to the Board of Directors for the purpose of deliberating and reviewing important transactions and actions that conflict with the interests of controlling shareholders and minority shareholders. In principle, the meeting is held once a quarter, and extraordinary meetings are held as necessary.
Through these measures, we have been able to establish a structure that minimizes involvement from the parent company and allows us to operate our business independently.
All executives and employees of the ValueCommerce Group comply with our Basic Policy on Anti-Corruption (Anti-Corruption Policy), along with all applicable anti-corruption laws and regulations in the countries and regions in which we operate.