Interviews with Outside Directors [ CSR/Governance ] - ANNUAL REPORT 2013

CSR/Governance

Interviews with Outside Directors

: Tatsuya Tamura

Director
(Outside, Independent)

Given your career experience, what role do you think that shareholders and investors expect you to play at AUTOBACS SEVEN?: The Board of Directors is the supreme decision-making body for routine corporate activities. I assume that shareholders and investors wish the board to engage in wide-ranging deliberations about overall corporate value rather than solely considering the interests of the management, employees, and key business partners involved in routine corporate activities. In general, deliberations on the boards of Japanese companies are solely by insiders. I believe that adding outside directors makes it possible to discuss issues that would not arise through internal deliberations, making board discussions fuller and more balanced.
What do you think of the governance structure of AUTOBACS SEVEN in comparison with those of Japanese companies overall?: The Companies Act of Japan provides two systems that a company may adopt 1) a Company with Committees or 2) a Company with a Board of Corporate Auditors system. Generally, the Company with Committees approach is considered to be the more advanced. That said, neither approach intrinsically determines true governance. The Company has retained a Board of Corporate Auditors, keeping a traditional Japanese corporate governance structure. It has enhanced this structure numerically and qualitatively with outside directors to reinforce actual governance. With this "hybrid" governance structure, we deliver very realistic results. Although there are some differences in governance between companies due to their corporate organization or "form," the important thing is to run a Board of Directors with a strong awareness of what governance or executive matters are. At AUTOBACS SEVEN, I think that the chairman of the Board of Directors makes sufficient decisions on such points and properly runs the board, so in this way the form is ideal.

: Norio Hattori

Director
(Outside, Independent)

Given your career experience, what role do you think that shareholders and investors expect you to play at AUTOBACS SEVEN?: I have spent more than 30 years of my career helping to maintain law and order, and have been involved in administration and management of various-sized organizations. AUTOBACS SEVEN operates with more than 500 stores. I believe that shareholders and investors expect me to constantly keep the whole organization in mind, monitoring management in the Board of Directors, naturally, but also endeavoring to maintain proper business execution.
What do you think of AUTOBACS SEVEN's compliance and crisis management structures?: The Company's compliance and crisis management structures were inadequate when I was elected as an outside director five years ago. Rules and other safeguards have gradually been established since then. It is important to note, however, the Company could instantly damage its image and brand by erroneously failing to fully adhere to laws and ordinances governing its operations. Such legislation includes the Road Transport Vehicle Act, the Product Liability Act, and the Act against Delay in Payment of Subcontract Proceeds, etc. to Subcontractors. I believe that it will become more important than ever to repeatedly educate employees and other internal stakeholders about laws and ordinances. Such efforts would go beyond mere formal reporting of specific cases or events and would clarify the issues and help prevent problems from recurring.

: Noriaki Shimazaki

Director
(Outside, Independent)

Given your career experience, what role do you think that shareholders and investors expect you to play at AUTOBACS SEVEN?: I think they expect me to draw on my 11 years of experience as a director of a general trading company to help formulate management strategies and contribute to risk management. In other words, I aim to help optimally allocate accumulated shareholders equity by involving myself in planning to increase the Company's shareholder value and provide appropriate advice. For example, for initiatives to expand existing businesses and build new businesses offering growth potential, I will thoroughly review and monitor everything from the formulation and execution of strategies through to post-implementation operational management.
In considering the management strategies of AUTOBACS, what do you think are the greatest strengths and opportunities?: The Company's strengths are that it has the highest shareholders' equity in its industry, a robust business network, and very experienced and educated executives and employees. Its strengths are that it has the high quality personnel, merchandise and service, and capital resources that it needs to drive corporate growth. Senior management has the responsibility of fully utilizing these operating resources to pursue corporate growth. The Company has many options it can take. In Japan, it can make preparations to acquire other companies or expand existing businesses. It can leverage its domestic experience and expertise to cultivate a proprietary model in emerging markets. It must urgently cultivate new human resources to undertake such endeavors.