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Guidelines Based on the Philosophy of "Corporate Openness"

With its company executives and employees mutually recognizing and respecting one another's individuality and capabilities, our company supports a philosophy of "corporate openness" that strives for fair and transparent business operation. Each Group company also observes this philosophy, and it is the basis upon which they conduct their corporate activities.
This corporate philosophy was initially realized through the daily actions of each executive and employee of Kagome Group. In this regard, our company formulated the Kagome Code of Conduct, a set of behavioral guidelines thoroughly adhered to by all group executives and employees.

The Kagome Code of Conduct

Established on October 3, 2018

■ Preface

In recent years, worsened social issues are threating the international community and the economic order by taking the forms of anti-globalism, protectionism, and nationalism. Sustainable society is a prerequisite for corporations to thrive into the future.
In Japan, the nation of a super-aged society with frequent natural disasters, self-help and public assistance are not enough. We need to come up with the spirit and the system of "mutual aid" to fill the void in between.
Under such circumstances, Kagome declares its active involvement in social issues as a part of the Vision 2025. We accelerate coalition with local governments, other companies, and NPOs to achieve this goal. Unfortunately, our work place is not immune from harassment including sexual one and abuse of power, which are simply unacceptable. We need to address these issues. Furthermore, we must re-commit ourselves to comply with fair business practices, to stand firmly against the reported scandals by major companies.

Based on the recognition above, the Kagome Group establishes the Code of Conduct, a signpost of day-to-day actions and decisions for each one of us. This Code helps us to achieve the Vision 2025, “a strong company of sustainable growth, resolving social issues with foods," and encourages us to fulfill our social responsibility with high ethical standards including compliance with laws and rules, and the spirits behind such regulations.

■ Code of Conduct

1. Mutual aid

(The system of mutual aid)
In regard to the social issues that cannot be solved through self-help and public assistance alone, we choose a target what we can do, and we proactively engage in the system of mutual aid.

(Collaboration with stakeholders)
Social issues cannot be solved on our own. We look for willing stakeholders who share the goal with us, and we carry out collaborative action.

(Mutual aid within the regional community)
As a member of the regional community, we make mutual support and mutual assistance toward the sound development of the regional community.

2. Respect for human rights

(Respect for individuals)
We respect individuals and their privacy. We mutually recognize the various skill sets and diversity of employees as Kagome’s most valuable assets.

(Prohibition of discrimination)
Each person is treated fairly and equally in the workplace. Discrimination is an infringement of human rights and is strictly prohibited.

(Measures against harassment)
We nourish a corporate culture that prevents and stops all forms of harassment, both inside and outside of our company. We never look the other way.

3. Fairness

(Fair play)
We follow the norms of society and organizations, always keep our promises, and never engage in fraudulent acts.

(Fair trade)
We never conduct or engage in transactions using a dominant bargaining position or are complicit in exploitation.

(Information disclosure)
We quickly disclose accurate information in an easy-to-understand format for higher transparency of the corporate activities.

Compliance Promotion System

Management Meeting (which is chaired by Kagome's President & Representative Director). The Compliance Committee, which is chaired by Director & Senior Managing Executive Officer with responsibility for over-seeing compliance, undertakes verification of compliance pro-motion and monitoring status. The results of the Compliance Committee's deliberations are reported to the members of the Management Meetings via the Joint Risk Management Meeting. The Legal Affairs Office, which functions as the secretariat of the Compliance Committee, plays the central role in day-to-day compliance operations.
Kagome Group companies in Japan established the Kagome Compliance Hotline, which is accessible to all domestic Group employees, and through which reports can be made and guidance given with regard to illegal or suspicious activities in the workplace. This system incorporates an internal direct line to the Compliance Committee's secretariat, as well as an external hotline to an outside law firm. To encourage employees to use these contacts without hesitation, the identities of those making reports are kept strictly confidential.
Kagome takes steps to protect the privacy of employees who make reports to ensure that these employees do not suffer any adverse consequences. We quickly conduct investigations based on the information received and take appropriate countermeasures. In such cases, respecting the principle that whistleblowers and other related parties cannot be identified, we share information internally so as to prevent similar incidents from occurring in the future. In fiscal 2016, the Kagome Compliance Hotline was used 15 times, and each case was resolved.
Kagome Safety NetContact details of the Compliance Hotline are registered on Kagome Safety Net, a smartphone application which can be downloaded by the employees, and every effort is made to ensure that employees can access the Compliance Hotline at any time.
Kagome fully recognizes the importance of compliance in relation to the Group companies located overseas. In 2014, an overseas internal reporting system has been introduced, and the scope of this system has been gradually expanded to include the Group companies located in the U.S. and Australia.
We will continue to strive to prevent and rapidly identify illegal activities through the appropriate operation of the Kagome Compliance Hotline.

Number of consultations and reports received by Kagome Compliance Hotline

Initiatives to Maintain Rigorous Compliance

Having formulated the Kagome Group Compliance Implementation Rules, Kagome Group implements thorough compliance throughout the Group. At domestic Group companies, the legal affairs department, which serves as the secretariat of the aforementioned Compliance Committee, leads these efforts.
Compliance implementation activities include not only the preliminary checks in compliance-related cases and the dissemination of compliance-related information, but also the conduct of group training for new employees and new managers, and an ongoing program of in-house compliance seminars, etc. that make use of e-learning, case studies, and group discussions. The in-house compliance seminars are integrated with the Skill Points program that forms part of the company's personnel management system, and participation in these seminars is a prerequisite for promotion.
Efforts are made to keep training up-to-date, taking account of new developments in society and using examples from within the company. The training arranged for fiscal 2016 included e-learning concerning tax compliance. In addition, the group training aimed to increase the employees' awareness of compliance-related issues, delving into topics such as the Subcontract Act, points to note regarding the use of social media, unjustifiable premiums and misleading representations, maternity harassment and LGBT.

In recent years, based on global trends, internal surveys on harassment have been held. The Harassment Elimination Guideline have been established as an embodiment of the goal of “nourishing a corporate culture that prevents and stops all forms of harassment” as stated in our Code of Conduct. Also, a Harassment Case Study has been compiled based on the internal surveys, and efforts are being made to ensure a high level of awareness at Kagome.

Furthermore, through programs such as SDGs, there is a global trend of heightened demand for preventing corruption. As an anti-corruption effort, the risk of bribery was assessed at Kagome overseas subsidiaries. After deliberation by the Management Meeting, the Kagome Group Anti-Bribery Policy was established as a practical application of the Code of Conduct. In addition to a Japanese version, the Policy has been created in local languages such as English, Chinese (traditional), Portuguese, Italian, and Spanish. Under supervision from CEOs of overseas subsidiaries, a high level of awareness for the Policy is being created at all Group companies.

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