Reflecting the Meiji Group’s System of Principles, the Meiji Group ensures highly transparent management for its customers, society, shareholders and investors, suppliers, employees, and all other stakeholders as well as for matters relating to the global environment through prompt, effective decision making and the timely disclosure of appropriate corporate information. Through this proactive stance, the Meiji Group aims to grow corporate value continuously.

In the Meiji Group, the holding company Meiji Holdings Co., Ltd., controls two operating companies.

A company with auditors, Meiji Holdings has a two-tier checking system comprising auditing and the Board of Directors’ oversight of operational implementation.

Moreover, the Company is strengthening its corporate governance structure through the following initiatives.
1) Appointment of outside directors
2) Limitation of the term of service for directors to one year
3) Appointment of an independent director
4) Establishment of a streamlined Board of Directors comprising only nine members to expedite business management decision making
5) Introduction of an executive officer system to separate implementation and oversight functions and clarify operational responsibility

The Company has adopted an auditor system, which it is strengthening and enhancing by appointing two outside auditors among its four auditors. Further, the inclusion of independent outside directors with diverse professional experience assists the Board of Directors in arriving at appropriate operational decisions based on extensive knowledge and expertise. In addition, the Board of Directors utilizes the operational auditing of auditors to ensure its business management is highly transparent, objective, and appropriate. In the Company’s view, the above-mentioned structure is the most rational manner in which to realize effective corporate governance.

Organizational Structure	Company with Auditors
Chairman of the Board of Directors	President and representative director
Directors	9 (including 2 outside directors)
Auditors	4 (including 2 outside auditors)
Appointment of an independent director	1 outside director
Number of times the Board of Directors convened in fiscal 2011	13
Number of times the Board of Corporate Auditors convened in fiscal 2011	14

Executive Committee (convenes twice a month in principle)
Members: Internal directors and executive officers
Role: Advisory body to the president and representative director
Function: Deliberating general important matters concerning operational implementation

Nomination Committee
Members: 2 outside directors, 2 internal directors
Role: Recommending candidates for the positions of directors or executive officers to the Board of Directors

Compensation Committee
Members: 2 outside directors, 2 internal directors
Role: Evaluating the performances and considering the compensation of directors and executive officers

Method of Determination

Directors: Calculated based on the Company’s business results and the individual’s performance, in light of peer compensation levels as shown by the data of external research companies, and maintained within the total amount approved by a resolution of the General Meeting of Shareholders. After consulting with the Compensation Committee, the Board of Directors approves the calculated amounts of compensation.

Auditors: Determined based on mutual consultation with auditors and maintained within the total amount approved by a resolution of the General Meeting of Shareholders.

Details of the Compensation of Directors and Auditors (fiscal 2011)

Independent auditor	Ernst & Young ShinNihon LLC
Audit department (internal auditing)	Audit department
Principal meetings auditors attend	Board of Directors, Executive Committee, Audit Department Liaison Meeting, Board of Corporate Auditors, etc.

Attendance of outside directors and outside auditors at meetings of the Board of Directors and Board of Corporate Auditors (fiscal 2011)

	Board of Directors	Board of Corporate Auditors
Outside directors	Approximately 92%	―
Outside auditors	Approximately 96%	Approximately 96%

The Meiji Group provides products and services to a large number of customers through its food and pharmaceuticals business operations. In accordance with the Corporate Behavior Charter adopted in April 2009, the Meiji Group has established an internal control system to ensure fair and sound business activities firmly rooted in compliance.

Regarding compliance as the cornerstone of its operations, the Meiji Group abides by statutory laws and regulations, international agreements, social norms, and the regulations of respective Group companies. The Group advances concerted initiatives aimed at inculcating and entrenching compliance awareness to ensure that employees carry out their duties equitably and honestly and based on a well-developed awareness of compliance and high ethical standards. Such efforts include improving and expanding educational and training programs, disseminating information through an in-house intranet, and making hotlines available.

• Establish risk management rules, construct an appropriate risk management system
• Conduct risk management systemically, carry out precise risk management for the Company and the Group while establishing systems to minimize damage in the event of an emergency