Sustainability

Compliance

Observing Competition Laws and Other Laws and Regulations Pertaining to Business Transactions

In addition to mandating compliance with competition laws in the NGK Group Code of Conduct, we have established the Competition Laws Compliance Rules, set forth to comply with international standards, which are strictly enforced by the NGK Group both in Japan and its overseas locations. We have established these policies and procedures in order to eradicate unfair business practices and maintain fair and equitable business relationships with our business partners.
We also provide education and training aimed at ensuring widespread awareness and thorough compliance with the Competition Laws Compliance Rules and the Competition Laws Compliance Handbook. Furthermore, since fiscal 2015, we have contracted PwC Advisory LLC (hereinafter, “PwC”) as our independent compliance professional. PwC is engaged to annually review the implementation status of the NGK Group's competition law compliance program per the Competition Laws Compliance Rules as well as assessing the overall oversight and reporting structures in place for NGK Group companies, both in Japan and overseas locations. On top of this, starting in fiscal 2017, PwC has also conducted interviews with the directors overseeing NGK's various business groups in order to: 1) assess the tone of each director's approach toward competition law compliance; and 2) to further enhance their awareness of these efforts. The results of these reviews are being leveraged for a variety of purposes, such as operating and improving the competition law compliance program.

Plea Agreement with U.S. Department of Justice concerning ceramic substrates for catalytic converters

Strengthening Our Compliance System Related to Competition Laws

Year conducted Regulation development Creation of internal systems Training
FY1997
  • Formulated guidebook and briefing document for the Anti-Monopoly Act
  • Required each business group to submit a Compliance Status Report on the Anti-Monopoly Act
  • Lectures on the Anti-Monopoly Act by outside instructors (attorneys) (subsequently held annually)
FY2011
  • Formulated Competition Laws Compliance Rules
FY2012
  • Created and distributed the Competition Laws Compliance Handbook
  • Created and distributed an Appendix to the Competition Laws Compliance Handbook
  • Established an independent committee
  • In-house training led by legal department staff
  • Lectures by local attorneys held at Group companies outside Japan
FY2013
  • Conducted briefing on the Competition Laws Compliance Handbook
  • Invited U.S. attorneys to lecture on competition laws
FY2014
  • Revised Competition Laws Compliance Rules
  • Launched operation of a database for advanced notifications and participation reports pertaining to meetings
  • Launched operation of an e-mail monitoring system
  • Revised Competition Laws Compliance Rules at North American sales subsidiaries
  • Introduced company-wide centralized supervision and reporting structures led by the Board of Directors (independent of the President)
  • Appointed company-wide competition laws supervisory managers
  • Enhanced the helpline
  • Conducted study meetings for newly appointed directors on competition laws and the Companies Act by Japanese and U.S. attorneys (subsequently held annually)
  • Conducted study meetings on competition laws at Group companies outside Japan (corresponding to laws and regulations in each country)
FY2015
  • Competition Laws Compliance Rules of all NGK Group companies in and outside Japan were revised to ensure that the NGK Group's compliance system meets global standards
  • Revised the Compliance Laws Compliance Handbook
  • The Competition Laws Compliance Program was resolved by the Board of Directors
  • Established the Global Compliance Office
  • Contracted Pricewaterhouse Coopers to review the implementation status of the NGK Group's competition law compliance program and assess the overall oversight and reporting structures in place for NGK Group companies
  • Conducted study meetings on competition laws for new employees
  • Distributed a DVD on competition laws to Group companies in Japan
  • Upgraded training on compliance with competition laws provided in and outside Japan
FY2016
  • The U.S. version and Chinese version of the Competition Laws Compliance Handbook were created and distributed to Group companies in the U.S. and China, respectively
  • Progress status of the competition law compliance program was quarterly reported to the Business Ethics Committee, which is composed mainly of external directors. The program was promoted based on suggestions received from the Committee.
  • Retained PwC Advisory to assess the status of competition law compliance
  • Expanded seminars led by attorneys in Asia
  • Held seminars on the Companies Act and competition laws for newly appointed executive officers
  • Prepared online-based training aimed at realizing broader training programs
    (Implemented in fiscal 2017 in Japan)
FY2017
  • Operating manual for database used to document competition law compliance underwent maintenance and updating
  • Top management of headquarters, business groups, and Group companies provided notifications about compliance with competition laws at beginning of term
  • Online seminars provided to 861 employees in Japan
FY2018
  • Clarified items that should be reported to the hotline when there were violations or fear of violation of competition laws, and revised Competition Laws Compliance Rules
  • Created a working manual for compliance with competition laws
  • Top management of headquarters, business groups, and Group companies provided notifications about compliance with competition laws at beginning of term
  • Held seminars on the Companies Act and competition laws for newly appointed directors and executive officers
  • Held competition law compliance lectures. All executives and managers attended.
FY2019
  • Revised Competition Laws Compliance Rules at NGK Electronics Devices, Inc. to strengthen that subsidiary's competition laws compliance system
  • Top management of headquarters, business groups, and Group companies provided notifications about compliance with competition laws at beginning of term
  • Held seminars on the Companies Act and competition laws for newly appointed executive officers
  • Held competition law compliance lectures. All managers and those designated by competition law compliance managers attended.
  • Information session provided regarding the Competition Laws Compliance Handbook's key points (on competitor information when creating email and documentation)

Note: Items in blue continue every year

Strict Adherence to Laws and Regulations Relating to Export Management

As part of its full compliance efforts, NGK is engaged in strictly observing and enforcing laws and regulations related to import and export control. Based on the NGK Group Code of Conduct, we stipulate abidance with laws and regulations related to secure export control, and we carry out export control and employee training in accordance with internal rules and the Export/Import Handbook.

Using Databases to Conduct Comprehensive Inspections and Customs Management

In response to the Foreign Exchange and Foreign Trade Act and other export control-related laws and regulations, NGK has screened exports to determine whether export licenses are required and has recorded screening results in a security export control database. However, since October 16, 2017, we have moved to a security export control system (TPP) and are performing management via this new system. Furthermore, export management with respect to the export of certain products is conducted under the Japanese government's AEO (authorized economic operator) Program.
We have used an export/import cargo management ledger to fulfill our obligations to track and record imports and exports; however, since our switch to a security export control system (TPP), we have been using the system's shipment ledger to track and record exports. We continue to use an import cargo control ledger for imports. Each department performs voluntary inspections of imports and exports under the AEO Program at the start of the fiscal year.
In addition, we use NACCS data (Nippon Automated Cargo and Port Consolidated System) to verify the completeness of export/import cargo management ledgers and shipment ledgers. We have achieved nearly 100% completeness for both imports and exports.

Familiarization with the Export/Import Handbook

NGK also makes efforts toward thorough compliance with the Export/Import Handbook, which was published in fiscal 2012 and summarizes items for the observance of export/import customs clearance regulations.
In addition to publishing this handbook on the company intranet where it can be viewed throughout the entire company, we provide training to spread awareness of the content of the handbook through study meetings related to export/import management conducted in each business division.
Study meetings on the AEO Program and export/import management are held one or more times per year targeting relevant staff in divisions responsible for export and import activities. In fiscal 2019, these meetings were held 31 times, with 568 employees in attendance.

Privacy Policy and Organization for Personal Information Protection

The NGK Group has established internal rules in an effort to ensure strict handling and management of personal information obtained from customers. In fiscal 2015, NGK formulated and published our Basic Policy on the Proper Handling of Specific Personal Information in response to the enforcement of the Act on the Use of Numbers to Identify a Specific Individual in Administrative Procedures. Moreover, our policies are in full compliance with the revised Act on the Protection of Personal Information, which came into effect on May 30, 2017.

Protection of personal information