Governance

Basic policy on corporate governance

Through fair and efficient corporate activities, the Company aims to earn the trust of our shareholders, customers, suppliers, local communities, employees, and other stakeholders, and to make further contribution to the international community in order to continue to grow and develop as a sustainable company. To achieve this goal, the Company recognizes that continuous improvement of corporate governance is essential, and as a top priority management issue, we are actively working on various measures.
In consideration of the meaning of the respective principles of the Corporate Governance Code, Suzuki will make continuing efforts to ensure the rights and equality of shareholders and the effectiveness of the Board of Directors and the Audit & Supervisory Board, as well as to upgrade the internal control system.
Also, in order to be trusted further by society and stakeholders, we will disclose information immediately in a fair and accurate manner prescribed in laws and regulations and actively disclose information that we consider is beneficial to deepen their understanding of the Company. Thus, we will further enhance the transparency of the Company.

Corporate Governance Report
https://www.globalsuzuki.com/ir/library/governance/pdf/report.pdf

Outline of the corporate governance system

The Company has adopted the current system with the idea that a company auditor system is the foundation and that the establishment of an optional committee for the appointment of highly independent Outside Directors, election of candidates for Directors, and decisions regarding remuneration will enable the improvement of governance.

■Corporate governance system

(As of June 23, 2023)

Status of corporate governance

Board of Directors

Board evaluation

The Company carried out analysis and evaluation in order to further improve the effectiveness of the Board of Directors. The outline is as follows.

(1) Method of evaluation

• As in FY2021, in FY2022 the Company focused on the Board of Directors’ challenges to enhance Suzuki’s competitiveness.
• From March to April 2023, interviews were held with individual Directors and as a group for Audit & Supervisory Board Members. Through this process, the Company confirmed future initiatives at Board of Directors meetings in line with discussions at the Executive Committee that took place after the interviews.

(2) Outline of FY2021 results and initiatives

a. Outline of results

• 1) Agenda-setting should be further strengthened to discuss the direction that the Company should take.
• 2) Explanatory materials should be clearer about key points for decision-making.
• 3) More reporting on progress in business execution should be made.
• 4) Explanations of materials should be shorter and done more efficiently to allocate more time to deliberation.
• 5) Members attending Board of Directors meetings should have separate meetings to discuss and exchange opinions without formality.

b. Initiatives

• 1) and 3): Scheduled agenda items were set in advance and discussed at the Board of Directors meetings in order.
• 2) and 4): The Board of Directors Rules were revised to make it easier for internal departments to understand the procedures to submit proposals to the Board of Directors, and precautions for submission were prepared and guided.
• 5):At the proposal of the Chairperson of the Board of Directors, the board members have an opportunity to freely exchange their views after Board of Directors meetings.

(3) Outline of FY2022 results and initiatives

a. Outline of results

The Company has received the following feedback from the Outside Directors:

• They have no complaints about the explanation itself and the deliberation time is appropriate.
• They are grateful that the Chairperson of the Board of Directors has taken care so that they can express their opinions candidly and that discussions held in other meeting bodies are made available before they attend a Board of Directors meeting.
• The Board of Directors as a whole is functioning well.

On the other hand, based on suggestions including those made by Outside Directors, the following three issues have been set as priority issues for FY2023:

• 1) Selection of topics for deliberations, resolution, and reporting
• 2) Scheduling and advance preparation for submitting proposals to the Board of Directors
• 3) When to distribute materials in advance and how to prepare and explain materials

b. Initiatives

To achieve the goals of Suzuki’s Growth Strategy for FY2030, the Company will make further improvements by setting appropriate agendas, ensuring more detailed scheduling including advance preparation of proposals to the Board of Directors, enhancing explanatory materials and streamlining explanations, etc.

Audit & Supervisory Board

The Audit & Supervisory Board is comprised of five members, specifically Full-time Audit & Supervisory Board Members Taisuke Toyoda and Masato Kasai, and Outside Audit & Supervisory Board Members Norio Tanaka, Norihisa Nagano, and Mitsuhiro Fukuta.
Mr. Taisuke Toyoda, Full-time Audit & Supervisory Board Member, has operational experience in the financial and audit divisions, and Mr. Norio Tanaka, Outside Audit & Supervisory Board Member, has ample experience as Certified Public Accountant. They have sufficient knowledge and experience in relation to finance and accounting. Mr. Masato Kasai, Fulltime Audit & Supervisory Board Member, has considerable knowledge in the fields of technology, quality control, environment, etc., Mr. Norihisa Nagano, Outside Audit & Supervisory Board Member, has extensive knowledge in law as a solicitor, and Mr. Mitsuhiro Fukuta, Outside Audit & Supervisory Board Member, has considerable knowledge in the fields of technology, human resources development, etc.
In addition, we have established the Secretariat of Audit & Supervisory Board as a full-time staff division independent of the chain of command of the Directors and others to assist the Audit & Supervisory Board Members in their duties. There are four staff members with expertise and experience in accounting and finance, auditing, overseas assignment, technology divisions, etc.
Audit & Supervisory Board Members’ audit procedures conform to the auditing standards of the Audit & Supervisory Board, and according to the auditing policy and division of duties, which are formulated after the General Meeting of Shareholders, Audit & Supervisory Board Members audit the proper execution of corporate management and communicate their opinions by attending meetings of the Board of Directors, Executive Committee and other important meetings, inspecting important approval documents, etc., and receiving reports and interviews from Directors and employees on the status of operations. In addition, Audit & Supervisory Board Members review and discuss the audit plan and topics formulated by the Audit Division, which is an internal audit division, and the results of operational audits conducted by the Audit Division.
The following are the main matters to consider, resolve, and report at the Audit & Supervisory Board meetings.

<Major matters to consider>

• Audit policy and audit plan
• Items to be submitted to Board of Directors meetings
• Status of development and operation of an internal control system
• Appropriateness, etc. of audit methods and results of Accounting Auditors

<Main issues to resolve>

• Audit policy, audit plan and division of duties
• Consent to proposals for election of Audit & Supervisory Board Members
• Evaluation, election and dismissal of Accounting Auditors
• Consent to auditing fees for Accounting Auditors
• Preparation of audit reports

<Main matters to report>

• Audit status and findings from each Audit & Supervisory Board Member
• Status of accounting audit of quarterly financial results, etc., and audits on business report and financial statements, etc.
• Audit plans from Accounting Auditors, report on results of quarterly review, status of implementation of annual audit, and initiatives for quality control of audit
• Discussions with Accounting Auditors on Key Audit Matters (KAM)
• Status of audits conducted by the Audit Division, which is an internal audit division, about the head office, major business sites, and subsidiaries
• Status of financial reporting from the Finance Division

Audit & Supervisory Board Members strive to share information based on the audit policy, audit plan and division of duties resolved at Audit & Supervisory Board meetings. In addition to the activities at Audit & Supervisory Board meetings, Audit & Supervisory Board Members are mainly engaged in the following activities.

• Communication with Directors, internal audit divisions, other employees, etc.
• Attendance at Board of Directors meetings and other important meetings
• Attendance at the meetings of the Committee on Personnel and Remuneration, etc., the Corporate Governance Committee, the monthly business report meeting, the product planning meeting, the Quality Assurance Committee, the Environmental Committee, etc.
• Inspection of important approval documents, etc.
• Investigation of the status of operations and assets at the head office and major business site
• Communication and exchange of information with directors, audit & supervisory board members and others of subsidiaries, etc., and verification of business reports from subsidiaries as necessary
• Attendance at accounting audits conducted by Accounting Auditors
• Exchange of opinions with Representative Directors and Outside Directors

After the end of the fiscal year, Audit & Supervisory Board Members evaluate the effectiveness of the Audit & Supervisory Board and detect issues therein to improve the effectiveness of the Audit & Supervisory Board for the following fiscal year.

Independence of Outside Directors and Outside Audit & Supervisory Board Members

As to the independence from the Company with regard to the election of Outside Directors and Outside Audit & Supervisory Board Members, the Company judges their independence under the Company’s “Standard for Independence of Outside Directors and Outside Audit & Supervisory Board Members of the Company” based on independence criteria set by the Tokyo Stock Exchange. Suzuki reports all the elected Outside Directors and Outside Audit & Supervisory Board Members to the Tokyo Stock Exchange as independent officers.

<Standard for Independence of Outside Directors and Outside Audit & Supervisory Board Members>

The Company judges an independent person who does not fall under any of the following as an Outside Director or an Outside Audit & Supervisory Board Member:

1. Persons concerned with the Company and its subsidiaries (“the Suzuki Group”)

• (1) With regard to Outside Directors, any person who is or was a person executing business^*1 of the Suzuki Group at present or in the past,
• (2) With regard to Outside Audit & Supervisory Board Members, any person who is or was a Director, Managing Officer, or employee of the Suzuki Group at present or in the past, or
• (3) A spouse or a relative within the second degree of kinship of a present Director or Managing Officer of the Suzuki Group

2. Persons concerned such as business partners or major shareholders, etc.

• (1) Any person who is a person executing business of any of the following:
  • 1) A company whose major business partner is the Suzuki Group^*2
  • 2) A major business partner of the Suzuki Group^*3
  • 3) A major shareholder holding 10% or more of the total voting rights of the Company
  • 4) A company in which the Suzuki Group holds 10% or more of the total voting rights
• (2) A person who is or was a representative partner or a partner of the Suzuki Group’s Accounting Auditor at present or in the past five years
• (3) A person who receives a large amount of remuneration from the Suzuki Group other than remuneration for Director / Audit & Supervisory Board Member^*4
• (4) A person who receives a large donation from the Suzuki Group^*5
• (5) A spouse or relative within the second degree of kinship of a person who falls under categories (1) through (4) above

Notes

• 1. A person executing business:
  An Executive Director, an executive officer, a Managing Officer or an employee
• 2. A company whose major business partner is the Suzuki Group:
  A company which belongs to the group of a business partner who has received 2% or more of its consolidated net sales in the group’s latest fiscal year from the Suzuki Group in any of the past three fiscal years
• 3. A major business partner of the Suzuki Group:
  A company which belongs to the group of a business partner who has paid 2% or more of the Suzuki Group’s consolidated net sales or provides loans to the Suzuki Group worth 2% or more of its consolidated total assets in the Suzuki Group’s latest fiscal year in any of the past three fiscal years
• 4. A person who receives a large amount of remuneration:
  In any of the past three fiscal years:
  • • A consultant or legal or accounting expert, etc., who receives annual remuneration of ¥10 million or more other than remuneration as a Director / Audit & Supervisory Board Member, as an individual
  • • A consultant or legal or accounting expert, etc., who belongs to an organization that receives annual remuneration worth 2% or more of its annual total revenues
• 5. A person who receives a large donation:
  In any of the past three fiscal years:
  • • A person who receives an annual donation of ¥10 million or more as an individual
  • • A person who belongs to an organization that receives an annual donation worth 2% or more of its annual total revenues and manages the activities that are the purpose of the donation

Training for Directors and Audit & Supervisory Board Members

The Company implements trainings that allow Directors and Audit & Supervisory Board Members to deepen their understanding of their respective roles, responsibilities, etc. We intend to make the training an opportunity in which Directors and Audit & Supervisory Board Members take part together in principle, so that they can share information on their respective roles, responsibilities, etc.
When a new Outside Director or a new Outside Audit & Supervisory Board Member assumes post in the Company, the Company will explain to the person the corporate philosophy, lines of business, finances, organizations, etc. In addition, the Company will prepare opportunities, such as interaction with Directors, Managing Officers and employees in the Company, attendance at various meetings related to business operation and management, and joining of factory inspections, to ensure that the person can deepen their understanding of the Company.

Committee on Personnel and Remuneration, etc.

To enhance transparency and objectivity in electing candidates for Directors and Audit & Supervisory Board Members, as well as deciding remuneration of Directors, the Company has established the Committee on Personnel and Remuneration, etc. as an optional committee. A majority of the members are Outside Directors.
The Committee on Personnel and Remuneration, etc. discusses issues such as election standards and adequacy of candidates for Directors and Audit & Supervisory Board Members, as well as the adequacy of the system and level of Directors’ remuneration. The Board of Directors decides based on their results. Also, the Board of Directors delegates decisions on some matters to the Committee.
Decisions made by the Board of Directors for the election and remuneration of Senior Managing Officers are also based on the results of the Committee’s deliberation.
The main issues reviewed in FY2022 were as follows:

• Appropriateness of policy for determination of individual remuneration, etc. of Directors in FY2022
• Determination of the specific details of basic remuneration for each individual Director in FY2022 (the Board of Directors has delegated this determination to the Committee on Personnel and Remuneration, etc.)
• Appropriateness of policy and procedures for determining the remuneration of Managing Officers in FY2022
• Appropriateness of policy on selecting candidates for Director or Audit & Supervisory Board Member and proposed candidates to be submitted to Annual General Meetings of Shareholders held in 2023 and subsequent years
• Appropriateness of proposed appointments for Executive Vice President

■Composition of the Board of Directors, Audit & Supervisory Board, and Committee on Personnel and Remuneration, etc. (as of June 23, 2023) and attendance in FY2022

◎:Chairperson ○:Member attending △:Observer

Notes:

• 1. Mr. Naomi Ishii and Ms. Naoko Takahashi were appointed as Directors on June 23, 2023.
• 2. Mr. Shun Egusa was appointed as a Director on June 29, 2022.
• 3. Mr. Norio Tanaka attended two of the seven meetings of the Committee on Personnel and Remuneration, etc. as a committee member and five of those meetings as an observer.
• 4. Mr. Mitsuhiro Fukuta was appointed as an Audit & Supervisory Board Member on June 29, 2022.

■Directors and Audit & Supervisory Board Members and their respective experience, specialization, and knowledge

*1 ◎ : Experience as President, ○ : Experience as executive officer
*2 ◎ : Experience in India / emerging countries

Executive Committee and other various meetings relating to business operation and management

In order to speedily deliberate and decide on important management issues and measures, the Company holds the Executive Committee, attended by Executive Directors, Managing Officers, Executive General Managers, and Audit & Supervisory Board Members, as well as meetings to report and share information on management and business execution on a regular and as-needed basis.
Also, various meetings are held periodically and whenever necessary to deliberate business plans, etc. and to receive reporting on operation of the Company, enabling the Company to appropriately plan, identify administrative issues at an early stage, and grasp the situation on execution of operation.
In such a way, the Company is enhancing the efficiency of decision-making at the meetings of the Board of Directors and the supervision of execution of operations.

Corporate Governance Committee

The Corporate Governance Committee has been established to examine matters to ensure compliance and risk management, as well as to promote the implementation of measures and policies for the Suzuki Group’s sustainable growth and the mid- to long-term enhancement of corporate value. The Committee also verifies the results of the effectiveness evaluation of internal controls over financial reporting in accordance with Article 24-4-4, Paragraph 1 of the Financial Instruments and Exchange Act.
Following a resolution of the Board of Directors in March 2023, the Committee was restructured in April 2023 to include the President as the Chairperson, the Vice Presidents, some of the Senior Managing Officers and Managing Officers as Vice Chairpersons, and other Managing Officers and the Executive General Managers as members, with Full-time Audit & Supervisory Board Members present as observers, commencing to oversee overall risk management including compliance.

Internal auditing

The Audit Division was established as an organization under the direct control of the President, whose staff members with expertise in various areas of the Company’s operations regularly audit the Company’s departments and domestic and overseas Group companies in accordance with the audit plan.
Operational audits include on-site, remote, and paper audits to confirm the appropriateness and efficiency of overall operations, compliance with law and regulations and internal rules, and the development and operation of internal controls, such as the management and maintenance of assets. The operational audit results are reported to the President, the head of relevant divisions and Full-time Audit & Supervisory Board Members each time an audit is conducted, along with proposals for improvement of matters pointed out. The results of audits are also reported to the Audit & Supervisory Board on a regular basis and opinions are exchanged there, as well as to the Board of Directors once every six months. Advice and guidance are provided until improvements are completed to solve issues at an early timing.
In addition, the effectiveness evaluation of internal controls over financial reporting in accordance with Article 24-4- 4, Paragraph 1 of the Financial Instruments and Exchange Act is conducted by the Corporate Governance Committee, and the results are reported by the Corporate Governance Committee to the Board of Directors and the Audit & Supervisory Board.
For subsidiaries with internal audit divisions, the Company’s internal auditing checks their activities, receives reports on their audit plans and results, and provides advice and guidance as necessary.
Furthermore, audit results are shared with the Accounting Auditor as needed, and regular meetings are held to share information, enhance communication, and maintain close cooperation.

Policy on Directors’ and Audit & Supervisory Board Members’ remuneration

a. Remuneration of Directors

Regarding the decision-making policy for individual remuneration of Directors (hereinafter referred to as the “Decision-making Policy”), the Committee on Personnel and Remuneration, etc., with a majority of the members as Outside Directors, is consulted on the appropriateness of the proposed policy. The Board of Directors deliberates and makes a resolution based on the report. The following is a summary of the Decision-making Policy as of the publication of this report.
Remuneration of Directors (excluding Outside Directors) consists of basic remuneration, bonuses linked to the Company’s performance of each fiscal year, and restricted stock remuneration to function as an incentive for continuous improvement of the Company’s corporate value resulting in the mid- to long-term stock price. The ratio is roughly 40% basic remuneration, 30% bonuses, and 30% restricted stock remuneration. Outside Directors’ remuneration shall be solely basic remuneration, given their duties.
Basic remuneration for Directors is fixed monthly remuneration, which is determined and paid in consideration of duties and responsibilities, remuneration levels at other companies, and employee salary levels. Bonuses are calculated based on a formula for each position linked to consolidated operating profit and are paid at a certain time each year. In addition, the content of restricted stock remuneration is determined based on the criteria for each position and is delivered at a certain time every year.
The Decision-making Policy for remuneration, etc. for FY2022 was established by a resolution at the Board of Directors meeting held on June 15, 2022, after a consultation with the Committee on Personnel and Remuneration, etc. on the same day.
The determination of specific details about basic remuneration for each individual for FY2022 was delegated to the Committee on Personnel and Remuneration, etc., in accordance with a resolution of the Board of Directors meeting held on June 15, 2022. The reason for this delegation was to increase the transparency of the process for determining remuneration. Specific calculation methods to decide on FY2022 bonuses for each position were resolved at the Board of Directors meeting held on the same day, and specific details about payment of restricted stock remuneration for each individual were resolved as of July 12, 2022 by a so-called written resolution of the Board of Directors meeting under Article 370 of the Companies Act, after an outline was explained in advance at the Board of Directors meeting. Based on the above, the Board of Directors has determined that the individual remuneration, etc. for Directors in FY2022 is in line with the Decision-making Policy.

Bonus (performance-linked remuneration)

Bonuses are paid to Directors (excluding Outside Directors) in order to raise awareness of improvement of each fiscal year’s performance. The specific amount of remuneration for each individual is calculated by multiplying the performance indicators predetermined by the Board of Directors by a stipulated percentage and the multiplication rate by position predetermined by the Board of Directors. The performance indicator is consolidated operating profit from the perspective of company profitability.

Restricted stock remuneration

It is paid to Directors (excluding Outside Directors) in order to function as an incentive for continuous improvement of corporate value and to further promote shared value with shareholders. Eligible Directors receive ordinary shares of the Company by paying all remuneration paid based on the resolution of the Board of Directors (monetary remuneration rights) as contribution in kind. The transfer restriction period is until the date of retirement from the position of Director. If a Director falls under certain grounds, such as the Director retiring for any reason other than that deemed reasonable by the Board of Directors, the Company shall acquire the shares allotted for no fee.

b. Remuneration of Audit & Supervisory Board Members

The remuneration of Audit & Supervisory Board Members shall be limited to monthly fixed remuneration and is determined and paid based on consultations with Audit & Supervisory Board Members.

■Amount of remuneration for Directors and Audit & Supervisory Board Members in FY2022

Notes:

• 1.The above bonus and restricted stock remuneration for Directors (excluding Outside Directors) are the amounts recorded as expenses in FY2022.
• 2.The above remuneration for Outside Directors includes the amount paid to two Directors who retired as of the conclusion of the 156th Annual General Meeting of Shareholders held on June 29, 2022 and one Director who retired by resigning on September 21, 2022.
• 3.The above remuneration for Outside Audit & Supervisory Board Members includes the amount paid to one Audit & Supervisory Board Member who retired by resigning as of the conclusion of the 156th Annual General Meeting of Shareholders held on June 29, 2022.

Status of meetings with shareholders, etc.

(Main dialogue topics)

Most of the main topics discussed concerned Suzuki’s mainstay Indian market for automobiles. A wide range of views were also exchanged on other main topics such as the Japanese market for automobiles, electrification strategy, financial figures, and shareholder returns.

(Main dialogue topics at ESG meetings)

The Company exchanged a wide range of views about measures for carbon neutrality, growth strategies, human rights, women’s empowerment, and corporate governance, among other topics.

The management team and Board of Directors are provided with feedback regarding dialogue content and other related details.

Situation of cross-shareholdings

Compliance

Basic Policy

For the Suzuki Group to achieve sustainable growth and development, it must be trusted by society and its activities need to be supported and understood. For this purpose, Suzuki recognizes that it is essential to not only comply with laws and internal regulations, but also adhere to social norms and carry out activities based on high ethical standards.
On the basis of the tradition and spirit passed down since the Company’s founding, in 1962 Suzuki established the Mission Statement, which expresses the corporate philosophy of “what kind of company we seek to become” with the aim of sharing values throughout the Suzuki Group. (Please refer to "Corporate Philosophy" for details.)
In 2016, Suzuki formulated the Suzuki Group Code of Conduct in line with the spirit of the Mission Statement, as a set of rules for enabling all persons working in the Suzuki Group to dedicate themselves to their duties healthily, efficiently, and energetically. This Code of Conduct has been made into a booklet so that all Suzuki Group employees can carry it at all times. Besides a Japanese version, English and Portuguese versions have been created and distributed to non-Japanese employees working in Japan. Also, at overseas subsidiaries, booklets written in the respective local native languages are distributed to employees.
Furthermore, based on the Code of Conduct, in 2020 Suzuki created and distributed the Compliance Handbook to all employees in Japan. This handbook specifically summarizes what people working in the Suzuki Group must and must not do from the perspective of compliance. Along with a Japanese version, Suzuki also created English and Portuguese versions of the handbook to enable employees to confirm and review their conduct at any time in their daily work.

Compliance system

●Corporate Governance Committee

Suzuki has established the Corporate Governance Committee directly reporting to the Board of Directors. The Committee examines matters to ensure compliance and risk management, as well as to promote measures and policies to address cross-organizational issues in cooperation with related departments. The Committee also verifies the results of the effectiveness evaluation of internal controls over financial reporting in accordance with Article 24-4-4, Paragraph 1 of the Financial Instruments and Exchange Act.
Following the resolution of the Board of Directors in March 2023, the Committee was restructured in April 2023 to include the President as Chairperson, the Vice Presidents, some of the Senior Managing Officers and Managing Officers as Vice Chairpersons, and other Managing Officers and the Executive General Managers as members, with Full-time Audit & Supervisory Board Members present as observers, commencing to oversee overall risk management including compliance.
The Committee engages in enhancement of compliance awareness by employees and urges caution for individual legal compliance throughout the Company. Furthermore, if compliance issues arise, the Committee deliberates each issue, formulates required measures, and reports the details to Directors and Audit & Supervisory Board Members as appropriate.

●Whistleblowing system (Suzuki Group Risk Management Hotline)

Compliance-related education

Compliance-related initiatives

●Status of measures to prevent recurrence of improper conduct during final vehicle inspections

JapanDomestic sales distributors

Risk management

Risk management system

Suzuki has established the Corporate Governance Committee under the Board of Directors. The Committee has been established to examine matters to ensure compliance and risk management, as well as to promote the implementation of measures to address cross-organizational issues in cooperation with related departments.
The Company ensures issues occurring or recognized in any department are deliberated on promptly by the Corporate Governance Committee or another committee, depending on their urgency and severity. The Company checks concerns of the impact and measures from each division every week at the Executive Committee to quickly grasp the impact on the business and make necessary management decisions on issues related to product quality, homologations, final vehicle inspections, as well as newer issues such as climate change and decarbonization, and issues of shortages of semiconductors and other parts or raw materials. Particularly important issues are discussed and reported by the Board of Directors.

Response to quality issues

The Company is working to strengthen its system for prompt investigation of causes and swift implementation of countermeasures to avoid situations where the prolonged response to quality issues causes major inconvenience to customers and an increase in the cost of countermeasures. The Company constantly keeps track of the latest status of quality issues at weekly and monthly meetings such as the Executive Committee. Market actions such as recalls are decided after deliberation by the Quality Assurance Committee, which is composed of related officers, Executive General Managers, General Managers, etc.

Establishing a tax policy

Suzuki established the Suzuki Group Tax Policy in December 2022 as the basic policy for thorough tax compliance and to conduct appropriate tax payments.

Efforts for preventing corruption

While acknowledging the existence of differences in laws and regulations related to competition such as antitrust law, those related to fair trading, and societal norms in each country or region, the Suzuki Group will grasp the differences and provide training to employees to ensure that they observe laws and regulations and societal norms in their respective countries and regions. We will work to prevent all forms of corruption, including bribery.

●Efforts for preventing bribery

Suzuki makes efforts to prevent bribery. The Suzuki Group Code of Conduct explicitly prohibits the bribery of public officials while the Compliance Handbook cites examples of specific prohibited acts (e.g., making facilitation payments, providing entertainment for public officials who have an influence on corporate activities, etc.).
Additionally, to build and maintain fair and proper relationships with all our business partners, Suzuki has prescribed internal regulations regarding entertainment received from our business partners and requires all executives and employees to obey these rules.

●Efforts for preventing anti-competitive behavior

Within the Suzuki Group Code of Conduct, Suzuki calls for compliance with laws and regulations, including competition laws, and provides thoroughgoing education in this area.
Moreover, Suzuki is working to raise the level of understanding among employees such as by citing specific prohibited behavior in an easily comprehensible manner in the Compliance Handbook.

Efforts for compliance with laws and regulations, respect for human rights and environmental conservation in the supply chain

In step with the global development of Suzuki’s business activities, its business partners and other stakeholders are increasingly multi-nationalized and diversified. As such, there are rising expectations for Suzuki to not only comply with the laws and social norms of each country but also fulfill its corporate social responsibilities (CSR) while giving consideration to the culture and history of each region.
Based on such social demands, Suzuki summarized in its CSR Guidelines for Suppliers its basic policy on the social responsibilities it must fulfill and the matters it must put into practice together with its business partners. Accordingly, Suzuki and its suppliers work as one team in promoting CSR activities.
Moreover, Suzuki newly established the Suzuki Group’s basic policy regarding human rights in December 2022. We believe that respect for human rights is the basis of all our corporate activities and are rigorous in this pursuit through each of the companies in the Suzuki Group. Furthermore, we expect all business partners associated with our business, including suppliers and dealers, to understand this policy and respect human rights, and proactively encourage and cooperate with them on their efforts.
Please refer to Suzuki Group Basic Policy on Respect for Human Rights.

Business continuity plan (BCP)

The Company has formulated a BCP assuming the occurrence of Nankai Trough megathrust earthquakes, and based on this, secures the necessary cash on hand and lines of credit as one aspect of measures to prepare for natural disasters.

Disaster measures by Suzuki

Suzuki takes various measures for natural disasters including Nankai Trough megathrust earthquakes to give top priority to protecting employees’ lives and quickly resuming our business for our customers as well as minimizing the impact of damages. For example, we have taken various preventive measures such as earthquake resistant measures for buildings and facilities, fire prevention measures, establishment of the disaster action manual and Business Continuity Plan (BCP) that includes establishment of a disaster countermeasure organization, and purchase of earthquake insurance.

●Damage prevention

While the Group has been taking various measures to prevent anticipated damage caused by Nankai Trough megathrust earthquakes, after experiencing the Great East Japan Earthquake, it has diversified production and research sites including those overseas. Firstly, it relocated plants and facilities to the Miyakoda district in the northern part of Hamamatsu from the Ryuyo region in Iwata, Shizuoka, since massive tsunami damages are anticipated in the region. The Group has diversified its production of engines for mini-vehicles, which was concentrated at Sagara Plant, to Kosai Plant to mitigate risk. Furthermore, the Group is expanding its research facilities in India in order to mitigate risk concerning product development facilities for automobiles at Sagara Proving Grounds. In order to enhance the performance of disaster countermeasure headquarters, which is to be established following a disaster, the head office periodically conducts training with officers and each representative of the disaster countermeasure headquarters attending in cooperation with a consulting company specialized in disaster countermeasures. Through these initiatives, the Group will continue to enhance its preparedness against natural disasters.

●Efforts against earthquakes and tsunami taken by Suzuki for local residents

●Measures against earthquakes and tsunami taken by Suzuki for employees

●Efforts against fire disasters

●Contribution to construction of storm surge barrier in the coastal zone of Hamamatsu

Suzuki contributed a total of ¥500 million by the end of September 2014 to the “Hamamatsu Tsunami Protection Measure Fund” which Hamamatsu City has founded for constructing a tsunami barrier as a countermeasure for tsunami caused by earthquakes. In addition, a total of ¥500 million was contributed to “Hamamatsu Sports Facility Construction Fund” by the end of March 2015 to cooperate with construction of a sports facility which has both a tsunami evacuation base and urgent relief heliport functions in case of a disaster. As a result, with the “Hamamatsu Tsunami Protection Measure Fund” and “Hamamatsu Sports Facility Construction Fund” combined, the total amount of contributions to the Hamamatsu City storm surge barrier was ¥1 billion.
The Company also contributed ¥340 million in total to eight neighboring cities and towns in western Shizuoka Prefecture, where many of its plants, associated facilities and business partners are located, for disaster measures such as earthquakes and tsunami by the end of March 2019, contributed ¥2.8 billion to Iwata City in August 2020 to promote the construction of the storm surge barrier, and donated a portion of land for the Ryuyo Proving Grounds in December 2021.

TOPICSGlobal Risk Management initiatives started

Suzuki started the Global Risk Management (GRM) initiative in FY2022 in cooperation with Tokio Marine & Nichido Fire Insurance Co., Ltd. and Tokio Marine dR Co., Ltd., which have risk management expertise, with the aim of building a system where “fire accidents don’t break out, are difficult to break out or quickly recover if they do break out.”

• (1) Formulate globally unified fire standards
• (2) Conduct joint fire prevention audits
• (3) Calculate a unified fire prevention score

Depending on the GRM initiative, we will enact a PDCA cycle, strengthening the planning and checking for the aforementioned three items while striving to enhance the effectiveness of the Do and Action we carry out daily.
In FY2022, we started initiatives in the Suzuki Motor Corporation’s main domestic plants and for domestic manufacturing subsidiaries, and plan to sequentially broaden their reach to development department facilities, sales offices and overseas offices.