Sustainability

Our policies and initiatives for the governance are introduced here.

We have established a corporate governance framework by clearly defining our commitment to our fiduciary duty, setting up compliance and investment committees, and other means. The framework enables us to ensure risk management and compliance in our operations, fairly handle transactions involving conflicts of interest, and work toward improving and further enhancing our corporate governance.

In addition, we place the highest priority on faithfully managing the funds entrusted to us by investors, and have established Basic Policy on Customer-Oriented Business Conduct and publicly announced the appropriate management of conflicts of interest transactions, clarification of fees, and other relevant matters.

• Information on our Basic Policy on Customer-Oriented Business Conduct can be found here (in Japanese).

Anti-corruption Policy

We recognize that legal compliance is a given, and that we must ensure compliance to continue being an organization that is trusted by society. We have therefore established our Anti-corruption Policy as part of our Compliance Manual. Our Anti-corruption Policy stipulates that we will maintain sound relationships with our stakeholders and that we will not provide entertainment or gifts that may lead to the suspicion or distrust of society. Specifically, we will firmly adhere to the following.

1. We will not engage in or be complicit in any form of corruption, including embezzlement, fraud, money laundering, or the obstruction of justice.
2. We will not provide money, services, conveniences, or other benefits to civil servants or persons in similar positions in Japan or elsewhere for the purpose of obtaining illicit gains.
3. We will not provide money, services, convenience, or other benefits to the officers and employees of private-sector business partners for the purpose of obtaining illicit gains.
4. We will not request business partners and others to provide entertainment or gifts that go beyond personal benefits or common sense.

Furthermore, we have established rules for prohibiting the provision of illicit benefits and rules for outsourcing management, which define prohibited acts and judgment criteria.

As for specific initiatives, we implement to apply guidelines related to bribery and internal audits to confirm that expenses are not being misused every year.

ITOCHU Group Anti-Corruption Policy

The ITOCHU Group has established the ITOCHU Group Anti-Corruption Policy based on the Corporate Ethics Code of Conduct. It prohibits the provision of money and goods, entertainment, convenience and other profits to public officials and officers and employees of private entities, in Japan or overseas, for the purpose of gaining an illegal advantage.

ITOCHU Group Anti-Corruption Policy

1. ITOCHU Group Anti-Corruption※ Policy
The ITOCHU Group ensures the implementation of the compliance principles, that is, legal compliance, and recognizes that it must continue to be an organization with acceptable standards in a modern society. We have no tolerance for any gain obtained through illegal means.

To address the risk of bribery and corruption, the ITOCHU Group has established rules that cover, among others, application and approval procedures and recording methods. These rules describe behaviors that are commonly found in scenarios where bribery or corruption take place, and instruct the strict observance of those rules. The rules were established based on “Regulations Concerning the Prohibition of Giving Illicit Benefit,” as well as four related guidelines about public officers, foreign public officers, business partners, and investments generally.

[ITOCHU Group Anti-Corruption Policy]

• No money, entertainment, gifts, or anything of value shall be given to any public or quasi-public official inside or outside of Japan, to obtain illicit gains.
• No money, entertainment, gifts, or anything of value shall be given to any director, officer or employee of any private entity, to obtain illicit gains.

2. Requests for All Partners
In order for the ITOCHU Group to implement the above anti-corruption policies, the ITOCHU Group requires the cooperation of all of its business partners and investment partners. When engaging with business partners, co-investors and targets of investments (collectively “Partners”), the ITOCHU Group is required by its internal rules to conduct due diligence on, and to enter into contracts containing anti-bribery provisions with such Partners.
On behalf of the ITOCHU Group we thank you for your understanding and cooperation.

April 1, 2020
Masahiro Okafuji
ITOCHU Corporation
Chairman & Chief Executive Officer

※Corruption: Making use of a position of power or authority for personal profit, including acts such as embezzlement, fraud, and money laundering.

Internal audit structure

We have an Internal Audit Office under the direct control of the president. Based on our Internal Audit Regulations, the Internal Audit Office conducts internal audits on the overall operations of all departments once a year to verify the status of their compliance with laws, regulations, the Articles of Incorporation, and internal regulations, as well as the procedures for executing duties and the validity of the work done. It also carries out unannounced inspections of information management and other operations two times a year. Furthermore, a system audit of IRM and property management companies is conducted by an external third-party organization once every five years. The Internal Audit Office itself is also evaluated by an external third-party organization once every five years.

If problems are identified or requests for improvement are made in audits, the audited department is required to formulate a plan for improvement and have it approved by IRM’s Board of Directors. Later, the Internal Audit Office conducts a follow-up audit and reports the progress made on improvement to the Board of Directors.

Whistleblowing system

We have set up whistleblowing contacts where all officers and employees can directly report misconduct (internal, at the parent company, and at an independent third-party). Under the whistleblowing system, we have established an appropriate handling mechanism, protect whistleblowers, and maintain the confidentiality of information. The system is designed to strengthen compliance management through the early detection and correction of improper acts, including bribery. The operational status of the whistleblowing system is reported to the Compliance Committee and the Board of Directors once a year.

The Compliance Officer immediately investigates the facts when report or consultation concerning a fact that is the subject of a report is received, unless there is a valid reason not to investigate the subject matter. The results of the investigation are reported to the representative director, president & CEO and to the general manager of the General Affairs and Management Division, and corrective action and measures to prevent recurrence are decided through discussion. If an internal disciplinary action is deemed appropriate, We will impose an appropriate disciplinary action on the officers and employees involved in the subject case in accordance with the Company's internal rules such as the Employment Regulations.

In addition, in compliance with the Whistleblower Protection Act, we prohibit disadvantageous treatment against whistleblowers.

Supervision by the Board of Directors and other bodies

We regard compliance as one of our most important management issues, and we are addressing it as follows.

The status of risk management and other information is reported to the Boards of Directors of IRM and each investment corporation as appropriate depending on the content. 

We formulate a compliance program each term to serve as a detailed plan of action for putting into practice the compliance manual, which is our code of conduct. The program is finalized after deliberation by the Compliance Committee and approval by the Board of Directors. The results of verification of the program’s progress and other factors are reported to the Compliance Committee and the Board of Directors. 

In addition, the results of internal audits and the operational status of the whistleblowing system are also reported to the Compliance Committee and the Board of Directors.

We also have a system in place in which the Compliance Committee and the Boards of Directors of IRM and each investment corporation can offer opinions and make other suggestions regarding the reported matters as needed to ensure that improvement efforts are effective.

Furthermore, the Sustainability Promotion Committee identifies and evaluates climate-related risks and opportunities, formulates strategic plans for key challenges, and verifies the results of measures based on the Climate Change and Resilience Policy, after which it reports these matters to the CEO and to the Board of Directors.

Implementation of compliance training, etc.

IRM offers such compliance training as general training for all officers and employees (including temporary employees and others in addition to full-time employees) Several times a year, training for new employees at the time of hiring, and training by department and rank. To date, we have taken up such topics as responding to legal amendments, measures to prevent power harassment and sexual harassment, and personal information management. By being timely in focusing on issues that society demands corporate action on, we are continuously working to enhance the compliance knowledge of officers and employees and to foster a mindset of compliance.

General training

In FY2022, we offered the following series of training sessions to all officers and employees (including temporary employees and others in addition to full-time employees): Administrative Disposition Cases, Information Security Structure. We also conducted exams on compliance every other month.

Training at the time of hire

In FY2022, for new hires (including mid-career hires, dispatched employees, and others), we provide training and review exams over a total of nine sessions on matters that they need to understand for their work at IRM.

Rank-based training

We provide rank-based training every year.

Others

Compliance-related information (including matters linked to preventing corruption) such as internal rules and regulations, the revision of laws and regulations, and compliance incidents and efforts at other companies is provided as appropriate.

In addition, as part of group compliance, ITOCHU Corporation conducts on-site compliance training at IRM once a year, using actual compliance incidents of group companies as a part of the teaching materials. The aim is to raise compliance awareness and prevent compliance incidents including bribery from occurring.

Compliance violations

In FY2022 (April 2022 to March 2023), there were no incidents of compliance violations disciplinary action based on our Employment Regulations or Board of Directors Regulations.

Violation of Anti-corruption Policy

There have been no incidents of violations of our Anti-corruption Policy, nor were any officers or employees disciplined or dismissed for this reason.

Payment of fines or settlements related to corruption

IRM has never paid any fines or settlements related to corruption.

Fines or settlements identified as ESG issues in audited accounts

No payments of fines or settlements have been identified as ESG issues in our audited accounts.

Donations to political parties and political funding organizations

IRM complies with the Political Funds Control Act, the Public Offices Election Act, and other relevant laws and regulations, and has never paid any political contributions.