Sustainability

Dialogue with Outside Directors

Directors 1: Joji Iki / Junji Uchida
We will continue our discussions to make Glory an attractive company to all stakeholders.
Joji Iki
  • Outside Director
    Chairperson of the Nomination Advisory Committee
    Member of the Compensation Advisory Committee

Held posts including president of the Gas Turbine & Machinery Company, senior vice president and senior executive vice president at Kawasaki Heavy Industries, Ltd.
Serving in the current post since June 2017.


Junji Uchida
  • Outside Director
    Chairperson of the Compensation Advisory Committee
    Member of the Nomination Advisory Committee

Held posts including managing director of NIPPON STEEL CORPORATION and representative director and president of OSAKA STEEL CO., LTD.
Serving in the current post since June 2019.

Q:Tell us about the role you are expected to play as an outside director of Glory.

Iki
As an outside director, I provide independent and objective supervision of Glory’s management, and its business execution from a perspective of validity and rationality. I also like to provide effective advice and firm support to business departments when planning and executing Group management strategies. This advice extends to such areas as product development for new markets and business domains, market development, and M&A.

Uchida
I believe that from the perspective of shareholders and other stakeholders, it is our task as outside directors to promote further vitalization of management and to make statements to ensure fair and appropriate business execution and operation. With the revision of the Corporate Governance Code, there is a growing demand for sustainable corporate growth and medium- to long-term value enhancement. As such, I recognize that our roles and responsibilities as outside directors are becoming more and more important.

Q:What is your assessment of Glory’s current governance structure and what issues does it face?

Iki
With the enhanced segregation of duties between the Management Conference and the Board of Directors, the latter is now able to focus more on strategic discussions and to supervise the execution of duties. I appreciate the fact that the members are provided with sufficient information in advance of meetings, and that we have engaging discussions to make a variety of proposals.
At the same time, I feel that participants can be more outspoken and willing to challenge each other. I also think that, to further expand Glory’s overseas businesses, there should be more Board members with overseas business backgrounds and the composition of the Board should reflect the focus of Glory’s businesses.

Uchida
I acknowledge Glory’s efforts to strengthen its governance system by appointing outside external directors and establishing both its Nomination Advisory Committee and its Compensation Advisory Committee well before the Corporate Governance Code was introduced. I would also like to note that there is an open atmosphere at Board meetings that makes it is easier for us to express our opinions, and this leads us to have vigorous discussions. On the other hand, we have challenges in the development of globally-competent human resources and the enhancement of corporate governance and risk management, which are the requisite for Glory to further grow in the overseas market. Transition to a ‘Company with an Audit & Supervisory Committee’ has enabled the Board of Directors to develop strategic discussions on ‘What to do’, considering ‘How to do’ based on operational matters reported and shared in Board meetings. We will continue our discussions with a focus on management strategies and provide guidance as necessary.

Q:What is being discussed at the Board of Directors meetings from a medium to long-term perspective and what issues are being addressed?

Iki
I believe that the strategies outlined in the 2023 Medium-Term Management Plan have been well-discussed, but the ability and the speed to execute these strategies is in question. As such, the Board is discussing the optimal allocation of management resources to achieve the set targets. With the business environment in a constant state of flux, I feel the challenge lies in how a sense of urgency can be shared not only by top management and certain managers but also among all employees Group-wide to the same degree.

Uchida
Glory has expanded its business globally via several key milestones, including the acquisition of U.K.-based 'Talaris' in 2012. However, growth has been sluggish lately given the changes seen in the business environment. The 2023 Medium-Term Management Plan promotes the idea of ‘Core and new businesses powering growth together’ for the next phase of future growth. As an outside director, I will keep an eye on how this concept is being incorporated into Glory’s day-to-day operations. Sowing a seed is not enough to pave a way for new businesses, and as such, I would like Glory to cultivate its corporate culture where employees are encouraged to take on challenges and receive recognition for their efforts even if they fail.

Iki
If we are to develop the next generation of leaders over the medium to long term, it is important to provide this generation of employees with opportunities to see the big picture of Glory’s business from a broader perspective. For example, one should be given an opportunity to carry out a project from start to finish, rather than being partially assigned to set tasks. I have requested Glory to provide us with opportunities to interact with all levels of employees through informal gatherings.

Uchida
As for human resource development, overseas businesses account for half of the Company’s sales, yet currently only a small number of employees have business experience outside Japan. To become a truly global company, Glory needs to establish a system to enable global exchanges of personnel and job positions.

Iki
I totally agree. I hope that the Overseas Business Company would spend even more time and resource to effectively capture the state of overseas business including its business environment and customers’ demand, and engage in human resource development of each region, to the same level we do for the Domestic Business Company.

Q:What challenges does Glory face in becoming a leading company that enables a ‘Confident World’?, as outlined in the Long-Term Vision 2028?

Iki
We will continue our discussions for short/medium/long term goals, set a future vision for each, then encourage employees to think what they need to do in their positions to achieve these goals. It might be helpful to share my story to encourage younger generations to take on new challenges.

Uchida
It is important for executives and managers to sow a seed to achieve the long-term vision, for example, using roughly 30% of work hours for future-oriented tasks. Mistakes may be made in the process, however, I would like to support Glory in building a positive corporate culture where employees are motivated and encouraged to take on challenges without the fear of failure.

Iki
As the world changes, Glory will face unexpected changes in business environments, as was the case with the COVID-19 outbreak. Being alert to minor changes is important, but it is equally important to make necessary shifts according to such major changes, and re-set the medium to long-term goals accordingly, just as we did for the performance targets last year during the pandemic. We will also require further discussions in line with the carbon-neutral targets announced by the Japanese government in 2020.

Uchida
What shapes the future of Glory is our ability to carry out the necessary tasks at hand with the long-term vision in mind. To that end, we are engaged in very fruitful discussions about new business domains such as biometrics and image recognition, as well as measures to expand the customer base. I would encourage Glory to continue taking on new challenges toward the goals set in the long-term vision.

Q:To conclude, what are your expectations of Glory as a company?

Iki
I would like Glory to provide a work environment where employees are able to do their best to achieve their goals. While all stakeholders are important to Glory, I especially hope that during their careers at Glory, employees will be able to take advantage of the irreplaceable experiences that lay in store.

Uchida
For Glory to remain valuable and attractive to all stakeholders including shareholders, customers, and employees, it needs to be a ‘good company’ that leverages its uniqueness and individuality to provide products and services that are beneficial to society. I would like Glory to be a company where everyone thinks about what should be done to achieve this.

Directors 2: Satoshi Hamada / Keiichi Kato
We conduct audits with a greater emphasis on shareholder perspectives, effectively leveraging systematic audits strengthened through the transition to a Company with an Audit & Supervisory Committee.
Satoshi Hamada
  • Outside Director (Audit & Supervisory Committee Member)

President of Satoshi Hamada Accounting Office. Holds post of outside director at other companies, including NISHIMATSUYA CHAIN Co., Ltd. and WDB Holdings Co., Ltd. (Audit & Supervisory Committee Member).
Appointed Outside A&SB Member of the Company in June 2015. Serving in the current post since June 2020.


Keiichi Kato
  • Outside Director (Audit & Supervisory Committee Member)

Registered as an Attorneyatlaw in October 2003. Attorney-at-law and partner at the Harima Law Office. Apart from serving as an Outside Corporate Auditor at Sanyo Color Works Ltd., Mr. Kato has extensive experience serving as an outside member of local government committees. Appointed Outside A&SB Member of the Company in June 2019.
Serving in the current post since June 2020.

Q:A year has passed since Glory transitioned to a Company with an Audit & Supervisory Committee. Please give us your assessment of this move, including how things have changed.

Hamada
Having transitioned, Glory’s Board has shifted from ‘management model’ to a ‘monitoring model’, enabling us to conduct systematic audits. The Audit & Supervisory Committee (A&S Committee) helps enhance the monitoring functions of the Board with an increased number of assisting members of the Committee and even more thorough discussions in preparation for the Board meetings.

Kato
With the current system, we are able to conduct systematic audits in closer cooperation with the Internal Audit Department, which has been positioned under the direct control of the A&S Committee since April 2021. In addition, the internal audit division of Glory Global Solutions, headquartered in the U.K., plays an important role when conducting global audits. Our systematic audits for fiscal 2020 were well supported by this division despite the limitations on global travel due to COVID-19.

Hamada
In recent years, internal Audit & Supervisory Board Members would travel to the U.K. every February with the accounting auditors to conduct on-site audits. Although we were unable to make this visit during fiscal 2020 due to the pandemic, local affiliates of the accounting auditors delivered quarterly reports, which enabled us to understand the pending issues. We will continue enhancing the effectiveness and comprehensiveness of our audits, in cooperation with our overseas affiliates and the accounting auditors.

Q:Are there themes to which you pay extra attention or aspects on which you focus during audits?

Kato
Based on my experience, I particularly keep a sharp eye out for compliance infractions, however small they may be, as they can often develop into major issues.

Hamada
When it comes to the increasing number in recent years of overseas M&A, I like to evaluate the validity of proposed value and benefit of acquisition in my own way as an accounting specialist, while respecting the opinions of the executive side.

Q:As an A&S Committee Member, what are your impressions of the discussions held by the Board of Directors?

Kato
I feel that the Board members, both internal and external, more actively express their opinions and engage in lively and productive discussions, compared to other companies. As for myself, I make inquiries in advance to seek clarity regarding the items to be discussed in the Board meetings, then continue to do so during the meetings if I still have concerns.

Hamada
Those outside directors who are not A&S Committee Members necessarily ask questions about each subject during the Board meetings. I also ask questions and give opinions to confirm for myself the contents of these discussions. Glory must carry out its growth strategy to shift towards a cashless society from the business based on the existing premise of a cash-based society. I believe that the direction of such strategy is finalized through the process of the executive side responding to the opinions and questions of the outside directors.

Q:As the importance of global governance grows, what areas are you particularly focused on in terms of your audit duties?

Kato
Ensuring legitimacy and adequacy is obviously a duty I execute as an A&S Committee member, but additionally as an outside director, I conduct audits with a greater emphasis on shareholder perspectives. Similarly, when proposals are made on risky investments, M&As, and investments for new businesses, I examine whether these are free of problems from the standpoint of shareholders. I also assume the similar perspective when reviewing contents and progress of a Medium-Term Management Plan, and thoroughly check the direction in which Glory is advancing and how the plan will drive growth and sales, as these are of significant interest to shareholders and investors.

Hamada
Prior to Board meetings, I review meeting materials to confirm whether there are any points related to financial accounting in particular, on which I should comment. In addition, I examine any major changes in balance sheets and consolidated statement of monthly performance reports, then clarify in the A&S Committee any concerns I may have including accounting processes, prior to attending Board meetings.

Q:The importance of non-financial information is being debated in the U.S. and European companies. What are your thoughts on this?

Hamada
Professor Kunio Ito, the author of ‘Ito Review’ released by the Ministry of Economy, Trade and Industry of Japan, has stated that comprehensively achieving ROE together with ESG, which he recently termed ‘ROESG’, will lead to greater corporate value in the future. ROE is an area that many Japanese companies have worked to improve thus far. I feel that Glory too must raise its ROE standard, but the true challenge for the future is to engage itself in ESG-oriented management. That said, I acknowledge Glory’s efforts for establishing its governance system as outlined in the Corporate Governance Guidelines, which is formulated based on Japan’s Corporate Governance Code, and for implementing highly conscious initiatives such as creating employee-friendly environments and collaborating with local communities.

Kato
Laws and regulations are revised or newly enforced in many of the countries, in which Glory operates. I do not have major concerns in this respect, as Glory Group’s legal division has a very solid framework for addressing new, and changes in, laws and regulations in each country.

Q:Tell us the direction you aim to take in the future as an A&S Committee Member.

Hamada
I serve as an outside director at two other companies besides Glory. While I recognize the differences between each company, I look to confirm if there are common themes of which Glory should also be fully aware. As for the future direction, I will ensure in the perspective of shareholders that Glory executes business in compliance with both legal and accounting requirements. In that term, when viewing proposals, reports and other related documents in the A&S Committee, I pay careful attention to see if there are any issues that has potentials to become serious or if there is any corporate culture that may lead to problems.

Kato
As with Mr. Hamada, I believe it will become even more important from now on to fully assume the perspective of shareholders. There has been a big change to Glory’s audits with the transition to a Company with an Audit & Supervisory Committee. Through such audits, I aim to examine whether management decisions are being made in the right manner.

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