nihonkohden

nihonkohden

Compliance

Our Commitment to Compliance

The term “compliance” (compliance with laws and regulations) has become quite common in the business world, and not only our company, but most companies have expressed that they are giving high priority on compliance. Still, there is no end to the companies that lose the trust of their customers or consumers and suffer serious damage by a violation of laws or socially disapproved behavior if not unlawful.

This is not a problem for someone else. Over many years, our management philosophy and business practices have earned the trust of our customers, business partners and other stakeholders. That trust is a precious and irreplaceable asset that is now integral to the "Nihon Kohden" brand. Even just one compliance violation can destroy such a precious asset.

Compliance is a part of corporate social responsibility and a minimum requirement for companies to continue to exist. Even more so, we strive to create an ethical culture within our business. No violation of compliance is acceptable in Nihon Kohden Group. When faced with making a choice between unlawful act for profits and ethical choices in compliance with laws in our daily business activities, I believe we will choose compliance without question and hesitation.

Nihon Kohden Group is committed to establish and maintain a robust and effective compliance program with zero tolerance for any misconduct and violation of applicable laws and regulations. In order to enjoy perpetual growth as a company with social significance, each and every one of us must ensure compliance and act based on high ethics with good sense as a member of society. 

Hirokazu Ogino
President and CEO
Nihon Kohden Corporation

I. Our Compliance Policies

Nihon Kohden and all of its subsidiaries (collectively, “the Company”) are fully committed to a program of sound ethics and rigorous legal compliance. Aside from being the “right” thing to do, these principles ensure that Nihon Kohden does not lose one of its most valued assets—the trust of its customers, business partners, and stakeholders.

Nihon Kohden’s commitment to ethical and responsible actions is embodied by its Code of Ethics and Conduct (the “Code”). The Code requires all executives, employees, part-time employees, temporary employees, etc. (collectively, “Employees”) to comply with all laws, regulations, and Company policies.

The Code further requires Employees to abide by ethical standards and respect social justice. Employees are obligated to clearly explain the purpose and contents of the Code to customers, distributors, and business partners.

The Company’s Charter of Conduct sets forth guidelines by which the Company and its Employees must abide. These guidelines ensure that the Company’s business activities comply with the Company’s Management Philosophy. The Board of Director has adopted these policies, ensuring that these values are promoted from the highest levels of the Company. These policies are subject to refinement or change as the Board deems appropriate.
 

Nihon Kohden Charter of Conduct
  1. We fight disease and improve health with advanced technology, and contribute to medical care around the world by providing high quality products and services with consideration of the environment and safety, and earn the trust of customers and patients.
  2. We comply with applicable laws, regulations, restrictions, and Company internal and external rules as well as ethical standards, and conduct fair and legitimate business activities.
  3. While maintaining a sound relationship with politics and government, we engage in fair, transparent and free competition and appropriate transactions.
  4. We take a firm stand against anti-social forces, such as organized crime groups, that threaten the order and safety of civil society, and have no relationship with them.
  5. In all aspects of our business activities, we respect the human rights of all people and we do not commit unreasonable discrimination or any act which infringes on the personality and dignity of an individual.
  6. We communicate with the public extensively as well as shareholders, disclose corporate information properly and fairly, and carry out highly transparent management.
  7. We are aware of our responsibility as a corporate citizen in the international community, respect the culture and customs of each country and region, and actively carry out social contribution activities.
  8. We are mindful of environmental issues as a global citizen, and address those issues voluntarily and proactively to leave for our posterity a healthy global environment.
  9. We ensure a safe and comfortable working environment and create a fulfilling life for our employees.

II. Compliance Organizational Framework

The Company has a global compliance program effective in all regions in which it conducts business. In order to ensure thorough compliance, the Company has created the following Compliance Organizational Framework:
Organizatoin Chart
Subsequent to the General Meeting of Stockholders, the Board of Directors is the highest decision-making body in the Company. The Management Council, consisting of all of the Company’s Directors and Officers, among other things, discusses all important compliance-related matters and submits them to the Board if the legal resolution is necessary.

The Compliance Committee is an organization consisting of directors, officers, and senior managers designated by the Board of Directors. The Compliance Committee ensures and enhances compliance by the followings:
 
(i) Establishing and amending the Company’s compliance policies;
(ii) Supervising, evaluating, assessing, reviewing, and continuously improving the compliance program of the Company;
(iii) Coping with important compliance issues; and
(iv) Studying, assessing, addressing, and implementation of responses to other compliance matters.
 
The Chief Compliance Officer (CCO) is responsible for management, operation, and implementation of the compliance program throughout the Company. The Divisional and Local Compliance Officers are empowered and authorized to implement, ensure, and enhance the compliance program in each division or subsidiary. The CCO carefully selects these individuals and regularly communicates with them to verify that global policies are implemented.

III. Internal Reporting System

The Company’s reporting system is an integral component of its strong compliance culture. Employees are required to report any violations of laws, regulations, or Company policies. If Employees do not feel comfortable reporting to their supervisors, they have the option to use an internal or external hotline service.

All integrity compliance-related matters reported through these systems are investigated by the CCO, in coordination with Local Compliance Officers as necessary. Furthermore, the CCO reports all such matters to the Compliance Committee.

The Company forbids all forms of retaliation against individuals who make reports in good faith. However, to alleviate any concerns of reporting Employees, the Company accepts anonymous reports. In response to the revised Whistleblower Protection Act, which took effect in Japan on June 1, 2022, the Company has established new rules to strengthen the protection of whistleblowers and further enhance its internal reporting system.

Internal Reporting Hotline Internal Reporting Hotline

IV. Preventing Corruption

The Nihon Kohden Code of Ethics and Conduct prohibits any act of illegal bribery or corrupt act towards Japanese and foreign public officials, and ensures compliance with laws and regulations preventing corruption in every region in which Nihon Kohden engages in business, including bribery and corruption-related laws in Japan, the Foreign Corrupt Practices Act (FCPA) in the United States, and the Bribery Act in the United Kingdom. Furthermore, Nihon Kohden has established the Anti-Corruption Policies, which prescribe detailed rules and procedures to prevent bribery, and ensures thorough adherence thereto. The Company also asks business partners including overseas distributors to understand and cooperate with Nihon Kohden’s anti-corruption efforts and provides them with the Nihon Kohden Code of Ethics and Conduct and educational materials related to anti-corruption.

V. Training

Every year, the Company conducts compliance training for all executives and employees at the workplace level in each division and subsidiary in Japan and overseas (Approximately 5,500 participants in FY2021). Executives and employees first conduct self-study using prescribed materials to check their level of understanding. Next, we read the materials and discussing it with colleagues in order to deepen employees’ understanding of compliance. As necessary, Local Compliance Officers in overseas subsidiaries provide additional training in accordance with local laws, regulations, and policies in each country. In addition, compliance study sessions are held in each division according to business such as harassment, Pharmaceutical and Medical Device Act, and sales activities. Furthermore, from FY2021, training on anti-corruption is conducted by outside experts for all executives such as office managers of domestic branch offices and domestic business operations.

The Company has also developed an Employee Compliance Handbook. This Handbook contains the rules, guidelines, and procedures that all Employees must follow. The Company distributes this Handbook to all Employees, so that it may serve as a reference tool when compliance matters arise on a day-to-day basis. The Handbook has been translated into several languages, ensuring that Employees throughout the world are able to understand and utilize it.

Employees of third parties who work on behalf of the Company in connection with public officials receive anti-corruption compliance materials at the outset of, and throughout the course of, the engagement. The Company conducts regular due diligence of these third parties to ensure that they provide regular anti-corruption compliance training to employees working with the Company.
 

VI. Initiatives for Global Compliance

Nihon Kohden introduced the Global Compliance Program in 2017 and is working to ensure thorough compliance throughout the Group, including overseas sales subsidiaries. In FY2021, we held training for managers of overseas sales subsidiaries and quarterly online meetings for Local Compliance Officers, and issued a newsletter. We also conducted risk assessments for all overseas subsidiaries to confirm the status of implementation of the Global Compliance Program and future areas of focus.
In the Three-year Business Plan, we will establish more robust compliance structure by addressing the following initiatives; to ensure strict compliance and strengthen group governance and to strengthen internal control over domestic sales.

VII. Formulated the Global Business Management Policy

As the role of our overseas subsidiaries has become more important under transforming into a global high-value-added company, we have worked to strengthen the organizational risk management capabilities of each company. In October 2021, we formulated the Global Business Management Policy to support risk management related to finance and accounting, personnel and labor affairs, compliance, and internal information security, with the aim of preventing occurrence and recurrence of fraud and misconduct, and started implementation in 24 overseas subsidiaries of the Company. We will periodically review and enhance the contents of this policy and work closely with each company to ensure its effective application.

VIII. Ethical Company Declaration

As an ethical company widely trusted by society, contributing to the world by fighting disease and improving health with advanced technology, we hereby declare as follows:
  1. We comply with laws and regulations, acting with fairness and high ethical standards.
  2. We engage in fair and open competition and transactions, never committing any bribery or other corrupt acts.
  3. We respect the human rights of all people, and do not discriminate or commit any acts which infringe on the personality or dignity of an individual.
  4. We aim to realize a sustainable society by addressing global medical and social issues through our business and corporate activities.
  5. As a global citizen, we address environmental issues proactively to pass on a healthy global environment to the next generation.

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