Governance

Maintaining Ricoh’s corporate value on behalf of all stakeholders

The Ricoh Group established The RICOH Way as a set of guiding principles and values that serves as the foundation for all our business activities. Abiding by these principles in corporate ethics and compliance and maintaining transparency in management, we continuously strive to improve our governance, and in doing so ultimately enhance our corporate value.

Corporate Governance

We strongly believe that responsible global citizenship calls for a corporate culture that embraces a sense of mission to meet the expectations of diverse stakeholders—a culture that is committed to operating under the highest ethical standards in line with the expectations of society as a whole.
Based on this belief, we advance the operations of the entire Group under The RICOH Way, strengthening our governance and ceaselessly promoting a culture of integrity while working toward sustainable corporate growth.
The Ricoh Group has also introduced a corporate audit system, in which audit and supervisory board members strengthen the effectiveness of audits and the monitoring of top management, while the Board of Directors, including outside directors, maintains strict oversight over the decision-making process to make sure it is always transparent and fair. Furthermore, by expanding the executive officer system, the segregating of duties between oversight and business execution is clarified, resulting in speedier decision-making.
The Group has also implemented an integrated risk management system for both business opportunities and business execution, and follows internal control procedures to achieve the success of our corporate strategies and business targets.

Governance structure Governance structure

Comments from Outside Directors

External perspective vital in creating new core businesses

Mochio Umeda

Mochio Umeda (Date of birth: August 30, 1960)

Director (outside) and Member of Nomination and Compensation Committee
Since June 2010

(Currently) President, MUSE Associates, LLC. (U.S.A.); Managing Director, Pacifica Fund I, LP.; Outside Director, ASATSU-DK INC.; Representative Director and President of MUSE ASSOCIATES INC.; Director, βinnovation, Co., Ltd.

Mr. Umeda has advanced knowledge of information technology and experience in global business. This gives him expert ability to analyze our decision-making process and offer valuable recommendations from an outside perspective. He attended 10 out of 11 Board meetings held in fiscal 2013.

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Three points to remember to ensure sustainable growth and higher corporate value

Kunio Noji

Kunio Noji (Date of birth: November 17, 1946)

Director (outside) and Member of Nomination and Compensation Committee
Since June 2012

(Currently) Chairman of the Board, Komatsu Ltd.; Outside Director, NEC Corporation

Mr. Noji was president and CEO of Komatsu Ltd. He has abundant experience and expertise as a member of top management of one of the leading companies in Japan. We believe that this wealth of experience and knowledge will greatly benefit our decision-making process, and Mr. Noji will be able to offer us useful advice and counsel from an independent perspective. He attended all 11 Board meetings held in fiscal 2013.

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Master the “flamingo pose” but work on building another leg to stand on, too

Makoto Azuma

Makoto Azuma (Date of birth: May 25, 1945)

Director (outside) and Member of Nomination and Compensation Committee
Since June 2014

(Currently) Professor, Graduate School of Innovation Studies, Tokyo University of Science; Advisory Professor, Tsing Hua University (China)

Mr. Azuma was senior vice president and executive officer and CTO (chief technology officer) of Toshiba Corporation and is currently a professor at Tokyo University of Science Graduate School of Innovation Studies. His wealth of knowledge regarding technology strategy and managerial expertise will help shape and integrate our decision making and guide our efforts with an objective, expert perspective.

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Management structure

  • The Ricoh Group has introduced a corporate audit system.
  • The Board of Directors is responsible for management oversight and important decision making concerning Group management. By appointing highly independent outside directors, the Group ensures greater transparency in its management and decision making.
  • Three of the Board’s nine directors are outside directors—part of an effort to incorporate various views and opinions and to eliminate arbitrary decision making in management.
  • To ensure a clear separation between management oversight and business execution, internal regulations stipulate that the chairman of the company—who in principle is not involved in the management of the business—serves as the chair of the Board of Directors.
  • Audit and Supervisory Board members hold discussions to determine audit and supervising policies and the assignment of duties, and monitor corporate management.
  • Audit and Supervisory Board members attend all important meetings, including but not limited to Board meetings, and exchange information regularly with the representative directors.
  • The Audit and Supervisory Board Members Office, with designated support staff, has been established to ensure that the Audit and Supervisory Board members can work effectively.
  • Under the executive officer system, the authority to carry out business has been assigned to respective functional departments so as to expedite decision-making and clarify the roles of each department.

Board of Directors and Audit and Supervisory Board

  • Board of Directors
    Maximum number of directors: 15
    Current number of executives: 9 (including 3 outside directors)
    Term: 2 years
  • Audit and Supervisory Board
    Maximum number of Audit and Supervisory Board members: 5
    Current number of executives: 4 (including 2 outside Audit and Supervisory Board members)
    Term: 4 years

(As of June 20, 2014)

Group Management Committee

The Group Management Committee (GMC) consists of executive officers and is a decision-making body empowered by the Board of Directors. The GMC facilitates deliberations and renders decisions on the Group’s overall management from the perspective of total optimization.

Nomination and Compensation Committee

The Nomination and Compensation Committee—a unique permanent body consisting of three outside directors and two internal directors—plans the appointment/dismissal policy of directors and executive officers as well as their compensation packages.

Internal auditing

The Internal Management and Control Division, which is in charge of internal auditing, objectively reviews and assesses the status of business execution by respective business divisions according to clearly defined rules to ensure legal compliance and adequacy of execution practices. It also provides advice and recommendations for improvement. The results are regularly reported to the GMC’s Internal Control Committee.

External auditing

Ricoh has formulated a set of guidelines called the “Policy and Procedures for Prior Approvals for Audit and Non-audit Services.” In accordance with these guidelines, advance approval must be obtained from the Audit and Supervisory Board members concerning the details of and fees for auditing contracts.

Executive compensation

In its pursuit of increased shareholder value, the Ricoh Group employs executive compensation as an effective incentive to achieve a sustainable increase in corporate earnings over the medium and long term.
The base salary of directors consists of remuneration related to management oversight, remuneration reflecting the importance of individual roles and responsibilities, remuneration for the purpose of purchasing treasury stocks (except for outside directors), and variable remuneration linked to stock price performance during the relevant fiscal year. The Ricoh Group has been strengthening incentives for executives to increase shareholder value over the long term by allocating a portion of remuneration for stock repurchase so that executives will have a common interest with shareholders.
The amount of bonuses paid to directors is based on the attainment of key performance indicators—such as sales, operating income and ROA—that pertain to shareholder value and the company’s competitiveness. Proposed bonuses for directors are brought before the general shareholders meeting for approval.
Compensation paid to the Audit and Supervisory Board members is composed solely of remuneration for their auditing duties.

Executive compensation Executive compensation

[Compensation for external accounting auditors]
Ricoh verifies the appropriateness of time spent on auditing together with audit firms and certified public accountants (CPAs), taking into consideration the scale and characteristics of our businesses to determine final compensation for auditing services.

Compensation for auditing by external accounting auditors Compensation for auditing by external accounting auditors

Securities Reports

Ricoh Institute of Sustainability and Business

The Ricoh Institute of Sustainability and Business has two think tank functions: to anticipate future socioeconomic trends and gauge their potential impact on corporate management; and to raise issues and offer advice, based on its research, to the top management of Ricoh. The Institute pinpoints structural transformations taking place in society with regard to ongoing changes in the business environment while conducting independent analyses highlighting business conditions specific to Ricoh. In addition, the Institute explores new growth models, addressing such issues as corporate objectives for contributing to the resolution of universal problems, such as global warming, and how the Company should respond to global competition. Results are reflected in medium- and long-term management strategies. Through this cycle of research tied to corporate initiatives, we seek to sharpen our competitive edge while gaining further trust from the international community.

Ricoh Institute of Sustainability and Business

Ricoh Institute of Sustainability and Business

Interacting with shareholders and investors

Interacting with shareholders and investors[General meeting of shareholders]
We review and revise our notifications of shareholder meetings and other materials as necessary to deepen shareholder understanding of our business activities. We subscribe to the online Electronic Proxy Voting system to make voting more convenient for shareholders. After each general meeting of shareholders, we hold a business briefing where the CEO describes the mid-term management plan as well as a social gathering where executives and shareholders can speak directly with each other.

[Various explanatory meetings]
We hold meetings, as necessary, where the CEO explains our mid-term management strategy and progress on the implementation of associated measures. We also hold meetings each quarter to present financial results.

[IR site expansion]
Materials related to general meetings of shareholders, investor meetings and financial announcements are uploaded on our investor relations (IR) site as they become available for the benefit of shareholders and investors unable to attend related events. Ricoh’s IR site has been recognized for excellence by several external organizations, including Daiwa Investor Relations Co., Ltd.

[Communicating with shareholders and investors]
In addition to social gatherings for shareholders, Ricoh organizes various other events, including camera seminars, so that shareholders and investors have an opportunity to gain a deeper understanding of the Group’s activities. These kinds of events were held eight times in fiscal 2014. We also hold meetings with over 400 worldwide institutional investor firms annually.

[Number of tangen shares]
The number of shares constituting one unit (tangen) of shares was reduced from one thousand (1,000) shares to one hundred (100) shares, effective January 2014.

Investor Relations
The 114th Ordinary General Meeting
IR Presentations

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