CSR / Environment

Compliance

Compliance

  • Self-evaluation: ★★★ Achieved more than targeted / ★★ Achieved as targeted / ★ Achieved to some extent
Fiscal 2017 Objectives Fiscal 2017 Achievements Self-Evaluation*
  • Strengthen compliance-promotion system
  • Hold compliance training and audits, and put in place rules
  • Promoted compliance through close collaboration within the Group
  • Implemented training, auditing, and coordination of rules on compliance in each category of laws and regulations
★★
Priority Objectives for Fiscal 2018
  • Enhance global compliance
  • Respond to international privacy protection, including GDPR

System to Promote Compliance

Sharp defines compliance as “observing social codes of conduct and company regulations, including laws and corporate ethics.” Accordingly, Sharp is pursuing management practices that give priority to compliance.

The person most responsible for leading compliance at Sharp is the general manager of the Corporate Strategic Planning and Control Group. This person is in charge of formulating basic policies for compliance and making sure these policies are firmly established within the company. Meanwhile, the person responsible for leading compliance for the entire Sharp Group is the general manager of the President's Office. This person is in charge of devising concrete measures for compliance and thoroughly implementing them. As well as affirming the implementation status of compliance measures, he or she draws up corrective measures where necessary and makes sure they are thoroughly executed. Under these two general managers, the general managers of the business units are responsible for compliance within their respective organizations. The business unit general managers are also responsible for guiding and supervising compliance measures at subsidiaries and affiliated companies (hereinafter referred to as “affiliates”) under their business units.

Promoting compliance at each affiliate is the responsibility of the affiliate president.

Among the laws and regulations that pertain to business execution, some are considered to be critically important and capable of affecting the entire Sharp Group. For each of these material categories of laws and regulations, the company sets up a dedicated legal department. The aim is to achieve thorough compliance with these laws and regulations. Each legal department fully understands the content of the critically important law and studies the effects it could have on the business of the entire Sharp Group and on operations shared by different departments. It then reviews—as needed—business operations and processes, revises company regulations, formulates or revises routine operation standards, and communicates these changes to executives and employees.

In the event a compliance-related risk is actualized, Sharp will implement an emergency response in accordance with the Basic Rules for Compliance and the Rules for Business Risk Management, and take comprehensive corrective measures and prevent recurrence.

Compliance Training

As a means of promoting compliance, the Sharp Group has formulated the Sharp Group Compliance Guidebook, which states defined standards for matters to be observed, matters which are prohibited, and actions to be taken for all executives and employees, and publishes and disseminates this throughout the company.

Sharp also periodically carries out compliance training (including e-learning) on the Sharp Code of Conduct and material categories of laws and regulations (such as competition laws, anticorruption, and personal information protection).

Consultation Hotline for Compliance Issues

Sharp Corporation and its affiliated companies in Japan have set up a hotline to provide counseling services for problems in the workplace, such as compliance issues. The company has also set up a competition law hotline, which serves as a contact point specifically for issues related to competition laws.

These hotlines are accessible inside the company and externally (via an outside law firm providing legal counsel) to enable employees and temporary staff—as well as employees of business partners*—to ask questions or request a consultation in line with the spirit of Japan's Whistleblower Protection Act. Sharp also has a consultation service dedicated to addressing workplace harassment (which includes sexual harassment, pregnancy discrimination, and abuse of authority).

In fiscal 2017, the compliance hotline received about 60 reports and requests for consultation. As a result, a violation by an employee was revealed, and the person received disciplinary action after being deliberated by the disciplinary committee.

The Sharp Code of Conduct clearly stipulates that the privacy of individuals who report compliance violations or seek consultation will be strictly protected and that those persons will suffer no unfavorable treatment or penalties.

Similar reporting and consultation services have been set up at Sharp's major overseas bases, and early actions are being taken to resolve problems.

  • Only the compliance hotline is available for use by employees of business partners.

Preventing Corruption in All Forms and Dealing Properly with Donations

The Sharp Group Charter of Corporate Behavior and the Sharp Code of Conduct contain provisions that strictly prohibit any form of corrupt behavior, such as extortion or direct or indirect bribes of money, goods, or services. The Group Charter and Code of Conduct also stipulate that donations must be handled in a proper manner.

In March 2015, Sharp instituted rules of conduct governing both executives and employees, with a view to preventing corrupt practices such as bribery. By setting up a clear system of checks, the company is working to prevent acts of bribery. Particular attention is paid to the employment of third parties such as agents and consultants, providing or exchanging gifts or entertainment to government employees, and participation in associations, with defined issues for relevant departments to confirm. Sharp sets up a consulting department for providing internal approval for each issue above. Sharp also prepares internal guidebooks and training materials for use by employees to ensure compliance with relevant laws, such as Japan's Unfair Competition Prevention Act and the US Foreign Corrupt Practices Act (FCPA), and implements internal training. No violations occurred in fiscal 2017.

In Japan, Sharp prevents illegal payoffs and improper expenditures through a system of compulsory reviews that check legality, reasonableness, and transparency. In place since December 2008, this system serves to assess the propriety of monetary disbursements such as donations and contributions made by Sharp Corporation and its affiliated companies.

The Sharp Code of Conduct states, “Regarding political donations, we will observe all applicable laws and regulations and we will ensure transparency and proceed in strict conformance with internal company rules when making such donations in line with the company policy to build a healthy and responsible relationship with politics and government.” Based on this policy, any political donations abide by relevant laws and follow the necessary internal procedures.

In March 2014, Sharp further tightened the assessment criteria to ensure fairer reviews. In fiscal 2017, there were 32 cases of such reviews.

Management of Personal Information

Domestic Response

In Japan, the revised Act on the Protection of Personal Information came into full force in May 2017. The strict management of personal information is demanded now more than ever. In response, Sharp holds annual e-learning on personal information protection for all employees in Japan in order to properly manage personal information and prevent incidences of data leaks across all departments. Sharp also holds training at each business site.

While the acquisition, provision to third parties, and joint use of personal information all require internal approval, Sharp has created a more effective system for personal information protection by defining the appropriate department from which to obtain approval. In addition, Sharp operates a unique system for registering customer personal information, which involves confirming the appropriateness of the acquisition, storage, management, use, and disposal of personal information as well as its current status. Comprehensive personal information management is ensured through self-checks linked into the system and on-site audits of specific departments responsible for management of personal information.

Global Response

On May 25, 2018 the General Data Protection Regulation (GDPR) came into effect in the European Union (EU).

In response, Sharp collaborated with its affiliates in Europe and carried out a survey across the Sharp Group and a risk analysis and assessment covering the acquisition and processing of personal data in the EU. Sharp has entered into Standard Contractual Clauses (SCC) specified by the EU authorities on the movement of data outside the EU between each site within the Sharp Group. Sharp is also preparing privacy policies and updating internal rules. Sharp captures changes to other personal information protection laws similar to those in the EU, for example in Asia, as they are introduced. Sharp carries out research and analysis on each country's personal information protection law, and promotes a global compliance strategy for the handling of personal information.

Compliance with Competition Laws

Basic matters relating to compliance with cartel rules under competition laws required of employees in their duties are set forth in the Antimonopoly Act Compliance Manual (Action Guidelines). To raise awareness amongst employees, Sharp has prepared a guidebook summarizing the key points of competition laws for each field of business, and it carries out periodic internal training. Sharp also raises awareness internally of case studies relating to competition laws from within Japan and internationally as well as information on major revisions to the laws. Sharp prevents actualization of competition law-related risks in transactions with business partners by reviewing all contracts and consulting with its legal department when approving new contracts.

Sharp maintains the effectiveness of the compliance program by confirming the circumstances of matters such as transactions and contacts with competitors in each field, and the legal department captures competition law risks by having the business departments report on the risks in these transactions and contacts. This enables Sharp to capture how likely competition law risks (such as cartel activities or bid-rigging) are to occur in a certain business area, and to prevent actualization of said risks. No violations occurred in fiscal 2017.

Exclusion of Antisocial Forces

Fundamental Stance on the Exclusion of Antisocial Forces

As a matter of basic policy, Sharp prevents or excludes any association with antisocial forces without exception, and deals with them in a resolute manner. It has established specific guidelines in the Sharp Group Charter of Corporate Behavior under the section entitled “Practice of Fair and Open Management,” as well as clearly stipulated in the Sharp Code of Conduct that Sharp shall seek to exclude antisocial forces by being “cooperative in the maintenance of social order, and will not engage in antisocial activity.”

Activities Aimed at Excluding Antisocial Forces

Sharp Corporation has established Rules for Excluding Antisocial Forces, which serve as the basis for Sharp's efforts to prevent antisocial transactions, as well as Sharp's preparation and updating, as needed, of such resources as manuals for dealing with antisocial forces.

In order to facilitate its handling of antisocial forces, Sharp maintains a system of prompt communication and cooperation with the police, legal advisors, and other external experts, from whom it regularly obtains information, which is then thoroughly disseminated and managed amongst the Sharp Group. Sharp also works to raise employee awareness by conducting once-a-year compliance training, which includes how to deal with antisocial forces.

In addition, Sharp Corporation and its affiliated companies in Japan take other steps to exclude antisocial forces, such as including a stipulation of antisocial forces exclusion in all basic agreements for ongoing transactions and concluding memorandums containing the equivalent stipulation with existing suppliers.