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Governance

Compliance

Policy and Basic Concept (Ricoh Group’s Human Rights Policy)

The Ricoh Group considers that “compliance” includes observance of not only laws and regulations, but also company rules and social ethics. Therefore, the Ricoh Group provides thorough instruction of each company's action principle, which provides the principles of Ricoh Group's corporate behaviors, and “Ricoh Group Code of Conduct”, which indicates behavioral principle of directors and employees of the Ricoh Group. Every member of the Group is concerned to ensure all employees observe the principles in their daily activities.

Ricoh Group Code of Conduct

The Ricoh Group Code of Conduct is intended to establish the basic standards to ensure that each company, executives and employees of the Ricoh Group, when engaging in corporate activities to advance the Ricoh Group, shall act in accordance with social ethics and in full compliance with the law.

Code of Conduct education

Since FY 2019, the Ricoh Group has provided Code of Conduct education to all global employees in line with the content of the Ricoh Group Code of Conduct, which was revised in fiscal 2018.

In Japan, the Ricoh Group provides all of its directors and employees with the education on the Code of Conduct via e-learning programs. The content of the education includes confirmation of each provision of the Code of Conduct as well as other topics relating to the enforcement of laws and regulations as priority issues with actual case examples. So far, topics such as, “Harassment” and “Compliance Violations” have been featured.

After finishing the courses, the participants are tested to check their level of understanding, and each person is expected to sign a pledge to confirm that they have understood and will observe the Code of Conduct.

In addition, in FY2020, we held a Compliance Month Campaign globally to promote the education and establishment of specialized compliance. We promoted enhanced compliance awareness of all employees by sending Top messages and conducting web-based education.

Internal Controls

The Ricoh Group aims for continuous improvement based on the values embodied in The RICOH Way.

That includes operating an internal control system designed to strengthen competitiveness while maintaining transparency based on principles of corporate ethics and legal compliance. Ricoh has established the Ricoh Group Corporate Management Principles as a set of guidelines for corporate activities, and follows the Internal Control Principles included therein.

  • The Group Management Committee (GMC) was established to oversee the Group's overall business operations and to enable quick analysis and decision making to ensure the best result for the Group as a whole.
  • The Internal Control Committee was established within the GMC to determine action policies, report incidents, and evaluate and correct the control system regarding internal controls, risk management and compliance in particular.
  • Corporate Management Regulations for Ricoh Affiliates stipulate the establishment of a supervising organization to oversee risk at all Ricoh Group companies.
  • The Ricoh Group Standards (RGS) have been established as a set of common rules for all Ricoh Group employees to follow, and adherence to these rules across the Group is ensured.
  • A disclosure policy has been established to ensure that corporate information released by the Group is accurate, timely and comprehensive. A Disclosure Committee has also been set up, with the CFO (who is the chief officer responsible for information disclosure) as its chairperson. The Committee is charged with determining and judging the importance of information to be disclosed, necessity of disclosure and adequacy of content being disclosed.
  • Internal audits are conducted to ensure the reliability of our financial reports, improve operational efficiency, confirm compliance to laws and regulations, and to confirm that risk management measures are being implemented properly.
  • The Fraud Risk Management (FRM) program of the Ricoh Group has been deployed to prevent fraud risk and adopts a check sheet and tools to detect anomalies within large volumes of data in the internal audit.

Internal audit

The Internal Audit Office, an independent dedicated organization under the direct control of the President and Executive Officer, conducts internal audits from the perspective of legal compliance, operational efficiency, reliability of financial reporting, and asset conservation. It then provides advice and recommendations for improvement from a fair and objective standpoint while coordinating with the internal audit departments of overseas subsidiaries regarding the status of business execution, including that of each business department within the group. The results are regularly reported to the "Internal Control Committee" established under the president's executive officer. The Internal Audit Office holds regular information exchange meetings with Audit & Supervisory Board Members and reports on the audit results and internal control status of the Group. Moreover, we utilize a common database to enable information to be viewed by the Internal Audit Office and Audit & Supervisory Board Members, and we carry out audits in close cooperation with these two bodies. In addition, the Audit & Supervisory Board Members, the Board of Corporate Auditors, and the Internal Audit Office hold regular and irregular information exchange meetings with the 3rd party Accounting Auditor to discuss the details of audits. Through these meetings, the four maintain close cooperation with each other by exchanging opinions on the status of internal control and risk assessment which is grasped by the auditors. Areas requiring improvement will be highlighted and examined by each department and consolidated subsidiary, and through reconfirming whether the necessary improvements have been made. These measures will ensure that the Group's internal control will be strengthened, and business execution will be improved.

Whistle-blowing system

The Ricoh Group has established “Ricoh Group Hotline”, which is made available to all directors, employees, part-timers and temporary staff in Japan as a contact for whistle-blowing and consultation regarding violations of compliance. Independent contact points are set up externally at the first point of contact. In any case, the numbers and website for exclusive lines has been set up to provide protection for the security of details of the consultation. Furthermore, a ban on unfavorable treatment of whistle-blower for the act of whistle-blowing or consultation itself, but also a ban on retaliatory actions against them have been established to protect whistle-blowers. The reception hours are being reviewed in order to make it more accessible to consult, for instance, night-time and holidays are added to regular work hours for telephone calls, and 24 hours for contact by website. The Group standard on whistle-blowing system was established by including these details, and is now applied.

The content of whistle-blowing and consultations are reported to the top management periodically, for the horizontal spread of improvement of problems and preventive measures of the Ricoh Group as a whole.

In addition to “Ricoh Group Hotline”, major companies in Japan and in overseas have established their own contact for whistle-blowing and consultation according to their organizational and regional characteristics.

In addition, since November 2018, the Ricoh Group has established the “Ricoh Group Global Whistle-Blowing System,” which is available to all directors and employees at Ricoh Group companies in Japan and overseas. We have built a system in which workers can report directly to the full-time auditor of Ricoh by e-mail. The number of whistle-blowing cases in 2020 was 989, of which no reports led to serious incidents.

Basic flow of the Hotline system in Japan

Improving the compliance mind

One of the seven values in Ricoh Way that should be respected by the Ricoh Group employees is the compliance mind “Ethics and Integrity - Act with honesty and accountability.” We are conducting awareness-raising activities for all Group employees to let the thought penetrate and motivate them to have a strong sense of ethics, a law-abiding spirit and always work with a sense of integrity and responsibility.

Furthermore, we translate into English and share the information on illegal matters throughout the Ricoh Group that are reported to top management.

Response to compliance related risks

As mentioned in “Risk Management” the risks relating to violations of compliance was set up as part of the risk management items which may exert a significant influence on the group's business (operation), the risk management is carried out, with focus on preventive measures on one hand, and rapid response in the event of an outbreak of a risk on the other.

“The Ricoh Group Code of Conduct” provides for the global basic policy and specific actions, while the Group standards and Guidelines provide for items that call for further responses.

The following shows examples of responses to some of the compliance related risks.

Bribery Prevention

The Ricoh Group established RGS, “Ricoh Group Standard for Bribery Prevention” in compliance with “7. Ensuring fair corporate activities”, stipulated in “Ricoh Group Code of Conduct”.

Ricoh Group Standard for Bribery Prevention

This standard sets out procedures aimed at the prevention of acts of bribery and to ensure compliance with laws and regulations prohibiting corruption and bribery such as the US Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act 2010, that are applied in any of the countries and regions in which the Ricoh Group operates business, and thus facilitates the bribery prevention of Ricoh Group companies and all of their directors and employees.

At the same time, the Ricoh Group established “Ricoh Group Bribery Prevention Guidelines for Third Parties” as well, in order to prevent bribery by third parties (*) of the Ricoh Group, by informing the Ricoh Group's policy of bribery prevention.

In addition, it is defined in the Guidelines that when making political contributions or other donations or providing sponsorship, it is necessary to comply with the laws and regulations applicable to the country or region concerned when doing so and to seek the approval of the decision-making authority at each Ricoh Group company in advance.

*
“Third Parties” refers to organizations and individuals outside of the Ricoh Group, who provide services “for the benefit of each Ricoh Group company” or “on behalf of each Ricoh Group company”.
Political contributions, donations and sponsorship expenses

Political contributions in FY2020: JPY 0

Donations in FY2020: All donations were properly processed with the approval of the relevant authority.

Prevention of bribery

In addition to the education of the Code of Conduct, the Ricoh Group has been conducting education about bribery prevention in accordance with the necessity of each region, attempting to familiarize the problems and taking preventive measures. In the United States and United Kingdom, in order to address the US Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act 2010, the policy on bribery prevention and entertainment and gifts was established and the education is being provided as well.

Furthermore, in order to respond appropriately to the laws for the prevention of illegal transactions by corporations, we have been cooperating with subject matter experts such as lawyers in order to prevent any in appropriate behavior.

Prevention of participation in anti-social actions

Preventive measures are being taken, for instance, guidebooks that provide the roles of responsible departments and daily behavioral norms are established in the RGS, and articles regarding the exclusion of organized crime are incorporated in various agreements with the third parties, etc.

As a company, in cooperation with the police, corporate lawyers and other external organizations, the Ricoh Group has established a framework to response timely and appropriately towards the contact from anti-social forces.

Preventing insider trading

Because of the fact that the Group Headquarters is located in Japan, the possibility of insider trading is higher than in other regions. Thus, in Japan, education by e-learning program is provided and specific rules are established in the RGS.

In the RGS, as one of the measures to prevent insider trading with respect to the trading of stocks of listed companies of the Ricoh Group, the rule for in-advance application is established. For instance, the periods prior to stockholders' meetings or before the release of the business results, insider information is most likely to rises. Thus, these periods are designated as lock-up i.e. a closed period, for the concerned parties of the Ricoh Group, such as directors, employees, part-timers and temporary staff.

Political contributions and other spending

The Ricoh Group's Corporate Code of Conduct stipulates that we comply with the relevant laws and regulations regarding transactions with public institutions and political contributions, and that we will practice (1) strict impartiality, neither making (2) improper political contributions nor participating in election activities.

Every year, we review the significance and necessity of joining each organization and confirm that the payment of contributions is appropriate.

Ricoh's political contributions and other expenditures over the last four years are as follows:


Political contributions and other spending

(Millions of yen)

Breakdown FY2017 FY2018 FY2019 FY2020
Lobbying, interest representation or similar 0 0 0 0
Local, regional or national political campaigns / organizations / candidates 0 0 0 0
Trade associations or tax-exempt groups (ex. Think tanks) 76.7 74.8 75.1 76.4
Other (ex. Spending related to ballot measures or referendums) 0 0 0 0
Total contributions and other spending 76.7 74.8 75.1 76.4

Major contributions / expenditures and Ricoh’s engagement

Name of organization Type of organization and Ricoh’s position / engagement
Japan Business Machine and Information System Industries Association
(JBMIA)
The Japan Business Machine and Information System Industries Association (JBMIA) is an industrial organization dedicated to the development of the Japanese economy and the improvement of the office environment through the comprehensive development of the Japanese business machine and information system industries.
Ricoh served as a representative company for two years, from 2018 to 2019, and our CEO, Yoshinori Yamashita, led the activities of JBMIA as a chairman.
More than 200 Ricoh employees from R&D and business strategies divisions participate in research. They work based on JBMIA's philosophy of proposing new work styles, pursuing safety and security for customers, and realizing a low-carbon society/circulation-based society. They are mandated to make policy proposals regarding technology and trade, international cooperation, global warming prevention, environmental conservation, standardization, product safety, etc.
Japan Electronics and Information Technology Industries Association
(JEITA)
The Japan Electronics and Information Technology Industries Association (JEITA) is an industrial organization tasked to promote the healthy manufacturing, international trade and consumption of electronics products and components in order to contribute to the overall development of the electronics and information technology (IT) industries, and thereby further Japan's economic development and cultural prosperity.
Ricoh works closely with other member companies to minimize the risks related to conflict mineral issues, human rights abuses, labor issues or environmental destruction, etc. We continue to secure transparency in the supply chain, and ensure responsible mineral sourcing practices.
Japan Business Federation
(KEIDANREN)
KEIDANREN (Japan Business Federation) is a comprehensive economic organization with a membership comprised of 1,444 representative companies of Japan, 109 nationwide industrial associations and the regional economic organizations of all 47 prefectures.
Keidanren is committed to the steady and prompt resolution of international issues by developing close economic relations with individual countries through policy dialogues with various governments and economic organizations. Ricoh is a member of the Executive Committee and the Standing Board, both of which deliberate policy recommendations and reports on all activities of Keidanren.
Japan Association of Corporate Executives
(KEIZAI DOYUKAI)
Japan Association of Corporate Executives (KEIZAI DOYUKAI) is a private, nonprofit, nonpartisan organization founded in 1946, whose mission is to improve the Japanese economic community and seek solutions for numerous domestic issues to ensure the overall well-being of Japanese society. KEIZAI DOYUKAI membership comprises approximately 1,500 top executives, and all members discuss various issues and make policy proposals, with the common belief that corporate managers should be key players in formulating solutions for a broad range of political, economic, and social issues.
Three executives from Ricoh are members and are actively engaged as chairs and vice chairs of various policy committees. Masamitsu Sakurai, chairman of Ricoh, was the lead secretary of DOYUKAI from 2007 to 2010.
Japan Machinery for Center for Trade and Investment
(JMC)
The Machinery for Center for Trade and Investment (JMC) is a non-profit organization established to engage in activities which enhance the common benefits of member companies and promote the sound development of international trade and investment by the machinery industry.
Ricoh sits on a committee that mainly deals with trade, economic cooperation, and export control. In cooperation with other members, we strive to analyze and study foreign laws and regulations, including foreign exchange laws and customs act, and make proposals to government organizations on enhancing export control conditions.

Tax Governance

The Ricoh Group's tax governance is based on a tax policy approved and established by the President and CEO (hereafter CEO), the representative director of the Board behind the introduction of Ricoh’s tax transparency system.

The Chief Financial Officer (hereafter CFO), who has been delegated authority by the CEO, is responsible for the Group's specific tax policies and procedures and implements them in accordance with internal rules and regulations.
In addition, the CFO reports tax-related issues to the Audit and Supervisory Board members. The Audit and Supervisory Board members request the Accounting Auditor explanations of tax issues as necessary and confirm the status of such issues.
The Ricoh Group fulfills corporate social responsibility by constantly updating these internal rules and regulations in accordance with the tax-related laws and regulations as well as the international regulations covering the rules of each country and region, and striving to maintain and improve tax compliance while paying appropriate taxes.