Corporate Governance Guideline

The eREX Group (“the Group”) is a long-established independent power producer and supplier (PPS) in the electric power industry. Based on its corporate philosophy of “Employees further promote the development of the company through tireless effort and by utilizing their own strengths and contribute to improving the standard of living in society,” the Company will take a highly ethical perspective and faithfully comply with all laws and regulations, while striving to improve corporate value by governing itself and contributing to society with social common sense.

The Group aims to contribute to society through its business activities. In the process of realizing the Company’s corporate philosophy, we the executives and the employees will be aware of corporate social responsibility and work in the spirit of legal compliance on the foundation of the various experiences we have cultivated so far.

Based on the above position, the Company’s Board of Directors will establish the following Corporate Governance Guideline and Corporate Governance System, which will be next in importance after the Companies Act, related laws and regulations and the Articles of Incorporation.

Relationship with Stakeholders

(1)Ensuring Shareholders Rights

To enhance its relationships with stakeholders such as shareholders, the Group strives to communicate broadly with society and discloses corporate information in a timely and appropriate matter in accordance with relevant laws and regulations. In particular, the Company recognizes that the General Meeting of Shareholders is a forum for constructive dialogue with shareholders and will consider the shareholders’ perspective in creating an environment where they can exercise their rights appropriately.
Furthermore, the Group emphasizes fairness, accuracy and continuity, as it actively engages in investor relations (IR) aimed at achieving effective two-way communication. As a company that is open to society, the Company will strive to encourage understanding of its corporate activities within society by preserving transparency in its corporate activities and conducting appropriate information disclosure to stakeholders such as shareholders.

(2)Responsibility as a Corporate Citizen

In the process of developing power sources and selling electricity, the Group aims to promote a better society for future generations. As a long-established PPS, the Group meets society’s expectations through the electricity business, as well as taking steps to resolve various social problems and actively implement social contribution activities as a “good corporate citizen.”

Board of Directors

(1)Board of Directors

The Board of Directors works to improve corporate value by ensuring highly transparent management and strong management supervision functions through the appointment of candidates for directors and for Audit & Supervisory Board members and other important decision-making.
The Board of Directors clarifies management supervision functions and business execution functions and appoints an appropriate number of two or more highly independent outside director candidates. The Board also establishes a structure that allows the outside directors to perform an appropriate advisory function.
The Board of Directors considers one of its main roles and responsibilities to be establishing the Company’s aspirations (corporate philosophy, etc.) and establishing a strategic direction. It is considered to be a decision-making organization that should engage in constructive discussion regarding specific management strategies, management plans and so forth. To ensure efficient decision-making, for matters that are not required by laws and regulations to be decided by resolution of the Board of Directors, decision making for matters set out in the table for setting positional authority based on the Positional Authority Regulations decided by the Board of Directors is entrusted to the president, vice president, or managing directors, etc.


Directors receive an explanation of legal cautionary points etc. and directors are thoroughly advised of their duties as directors, including the “duty of loyalty” and the “duty of care of a good manager.”
Outside directors are appointed with a view to ensuring diversity from a pool of candidates with strong experience, advanced insight and specialist knowledge in various fields. Moreover, the Company does not appoint outside directors who do not have real independence based on the Company’s own “Independence Standard” for outside corporate officers.

Audit & Supervisory Board Members and the Audit & Supervisory Board

(1)Audit & Supervisory Board Members

The Audit & Supervisory Board members attend Board of Directors meetings and other important meetings, as well as browsing important documents related to decisions and so forth. In this way, they audit important matters related to company management and business operations as well as the status of business execution. They report the results of their audits to the representative director.They also strive to strengthen audits by exchanging information with the Internal Audit Department and the accounting auditor.
The Company provides company information to the Audit & Supervisory Board members and opportunities to acquire sufficient understanding of the role and responsibilities required of Audit & Supervisory Board members through continuous participation in external training, external organizations and so forth, for which the Company pays the necessary expenses.
Outside Audit & Supervisory Board members are selected from people with rich knowledge and experience in various fields. Moreover, candidates who do not have real independence based on the Company’s “Independence Standards” for outside corporate officers are not appointed as outside Audit & Supervisory Board members. Outside Audit & Supervisory Board members together with other Audit & Supervisory Board member cooperate with the Internal Audit Department and the accounting auditor to perform audits from a more neutral and objective perspective, thereby ensuring the soundness of management.

(2)Audit & Supervisory Board

The Audit & Supervisory Board performs its role and responsibilities, such as auditing the directors’ execution of duties, exercising authority with relation to the election and dismissal of accounting auditors and compensation for audits. In doing so, the Board makes appropriate judgments from an independent and objective perspective, based on its fiduciary responsibility to shareholders.