NO BORDER

Corporate Governance
General Meeting of Shareholders
Internal Control System
Report
Board of Directors
Consultation/
Recommendation
Selection and
Appointment
Management Committee
Investment and Loan
Strategy Committee
Executive Committee
Audit
Audit Report
Selection and
Appointment
Representative Director
Direction/
Supervision
Report
Audit Report
Direction/
Report
Board of Corporate Auditors
Liaison
Report
Information Security Committee
Environmental Committee
Business Ethics Committee
Selection and
Appointment
Liaison
Internal
Auditing
Office
Audit
Audit
Audit
Report
Liaison
Liaison
Audit
Selection and
Appointment
Independent Auditors
Business Execution
Business Divisions
Advice and
Guidance
Lawyers,
Tax Accountants
and Other
Professionals
Internal Activities
> Basic Stance on Governance
The greatest priorities for Nissin Foods are to supply safe
products and to maximize the benefits to all stakeholders,
including shareholders, consumers, employees and local
communities. The improvement and reinforcement of corporate
governance is another key priority, and we are constantly
working to maintain high standards of objectivity and
transparency in our management activities.
For many years, we have appointed outside directors
and auditors to energize management and ensure transparency
by positively reflecting the views of non-employee
experts in management. In June 1998, we also introduced
an executive officer system to speed up decision making
and separate management from business operations.
> Setting Clear Corporate Functions
Nissin Foods has 11 directors, including two outside directors.
The Board of Directors meets monthly and convenes
special meetings as necessary. The role of the Board of
Directors is to deliberate on matters required by laws, regulations
and the company articles. The directors also monitor
business operations and supervise each other.
Directors also participate in decision making and supervise
operations at regular meetings of the Management
Committee, which consists of full-time directors and standing
auditors, and the Executive Committee, which is made up of
full-time directors, standing auditors and executive officers.
There are four corporate auditors, including two outside
auditors, who audit operations in accordance with standards
established by the Board of Corporate Auditors, the audit
policy for each accounting period, and the audit plan. They
attend important meetings, including meetings of the Board
of Directors, and interview directors and other officers concerning
the state of operations.
The Board of Directors nominates candidates for directorships,
and sets levels of remuneration.
> Status of Internal Control Systems
The development, maintenance and appropriate operation
of internal controls is a critical management task involving
the entire corporate organization. Individual organizational
units have established internal checks and balances covering
day-to-day operations, including procurement, production,
logistics, sales and administration. We are also setting
up checks and balances between organizational units.
The Internal Auditing Office and the corporate auditors
check internal control system effectiveness through operational
audits of each unit and order remedial action if called
for. Corporate auditors also audit internal control systems
relating to management in general.
ANNUAL REPORT 2006
19