Corporate governance

MTI’s key management priorities include the establishment of a sound and highly transparent management structure, and the creation of systems to support timely, appropriate decision-making in response to a changing business environment. One of the measures introduced with the aim of achieving these goals was the adoption of a oneyear term of office for directors. This has added a sense of urgency to the management environment, since directors are required to earn the confidence of shareholders every year. We are also working to strengthen and consolidate our compliance systems.

In accordance with our IR policy, we provide timely and accurate disclosure of information including financial results and other key management data. We also emphasize two-way communication with all stakeholders to enhance management transparency and build relationships of trust with market participants.

Audit & Supervisory Board Members’ Audits

The Company is a company with an Audit & Supervisory Board. The Audit & Supervisory Board consists of one standing Audit & Supervisory Board Member and three non-standing Audit & Supervisory Board Members. Chie Kasahara, a non-standing Audit & Supervisory Board Member, has a great deal of experience in corporate legal affairs and considerable knowledge in legal affairs.

A post of assistant to auditor has been created to provide assistance in the duties of Audit & Supervisory Board Members and the Audit & Supervisory Board. One full-time staff member is installed in this post.

Individual Audit & Supervisory Board Members audit the state of execution of duties of individual directors. Their roles also include examining whether or not the execution of duties by any director, executive officer or employee complies with laws, ordinances and the Articles of Incorporation and the performance of auditing aimed at ensuring the appropriateness of accounting and other documents.

Internal audits

In internal audits, the Internal Audit Department (six members), which is under the jurisdiction of the Representative Directors and President, conducts business audit activities focusing on compliance with internal regulations and the efficacy and efficiency of business activities, in addition to auditing the execution of duties. The Internal Audit Department also carries out an evaluation of the efficacy of internal control over financial reporting in accordance with the Financial Instruments and Exchange Act to ensure the reliability of financial reporting.
In addition, in order to further enhance the effectiveness of the threefold audit, the Board of Corporate Auditors, the Accounting Auditor and the Internal Audit Office meet on a regular basis for approximately 1.5 hours once a quarter to work closely together and exchange information and opinions.

Accounting audits

• Name of audit corporation: Ernst & Young ShinNihon LLC.

  ・Certified public accountants who carry out the audit: Masahiro Okonogi, Yonako Emura

  The number of consecutive years conducting audits of MTI as of the end of September 2024 is three years (from January 2022) and two years (from January 2023) respectively.

• Composition of assistants with audit operations

  Persons who provide assistance for MTI’s accounting audit work consist of 9 certified public accountants and 17 other persons.

• Policy on appointment of Accounting Auditor and reasons for appointment

  MTI appointed Ernst & Young ShinNihon LLC. as Accounting Auditor based on the results of examination by the Audit & Supervisory Board taking into comprehensive consideration a range of factors including the quality management structure, the independence and expertise of the audit team and audit remuneration.

  MTI’s Audit & Supervisory Board will dismiss the Accounting Auditor based on the unanimous approval of all Audit & Supervisory Board Members if any of the matters set out in the Article 340, Paragraph 1 of the Companies Act is deemed to apply to the Accounting Auditor. In this case, an Audit & Supervisory Board Member elected by the Audit & Supervisory Board will report the dismissal of the Accounting Auditor and the reason for dismissal at the first General Meeting of Shareholders convened after dismissal.

  In cases other than the foregoing where it is deemed difficult for the Accounting Auditor to perform appropriate audits due to the occurrence of events which undermine its suitability or independence, the Audit & Supervisory Board will determine the details of a proposal for the dismissal or non-reappointment of the Accounting Auditor to be submitted to a General Meeting of Shareholders.

Reason why the Audit & Supervisory Board consented to the remuneration, etc. of the Accounting Auditor

The reason why the Audit & Supervisory Board Members gave consent pursuant to Article 399, Paragraph 1 of the Companies Act is that they judged the level of the Accounting Auditor’s remuneration to be appropriate based on confirmation and examination of factors such as the details of the Accounting Auditor’s audit plan, its audit track record and the basis for calculation of the remuneration estimate.

Audit fees

Fiscal year ended September 30, 2024
Fees for audit services
MTI Ltd. 52,000 thousand yen
Consolidated subsidiary 10,440 thousand yen
Total 62,440 thousand yen

Officers’ remuneration paid to MTI’s Directors and Audit & Supervisory Board Members in the fiscal year ended September 30, 2024 and audit remuneration paid to the Accounting Auditor is as follows.

Total remuneration for each officer category of MTI, total amount by type of remuneration, and number of eligible officers

(Unit: thousand yen)

• (Note) The number of directors subject to compensation excludes one director who does not receive any remuneration.

Total remuneration on a consolidated basis for each officer of MTI

The information is omitted because no officers receive remuneration, etc. of ¥100 million or more.