Rules of the Audit Committee

Rules of the Audit Committee

• These Rules provide for matters related to the Audit Committee of Eisai Co., Ltd.

  • 2.
    In these Rules, “ENW” means a group of corporate entities, consisting of the Company and the subsidiaries and affiliates of the Company. “ENW Entity” means each entity within ENW.

• The Audit Committee shall perform the following duties:

  • 1)
    Audit the execution of duties by Directors and Corporate Officers.
  • 2)
    Audit the business report and its supplementary schedules, and the accounting-related documents (the consolidated financial statements, and the financial statements and their supplementary Schedules). Such audit shall include monitoring and verifying the appropriateness of the methods and results of the audit conducted by the External Auditor.
  • 3)
    Prepare audit reports in relation to the audits described in items 1) and 2) above.
  • 4)
    Determine the content of proposals to be submitted to the shareholders’ meeting concerning the appointment, dismissal, or non-reappointment of the External Auditor.
  • 5)
    Give consent to decisions regarding the remuneration and other compensation of the External Auditor or any person acting as a Temporary External Auditor.
  • 6)
    Perform other duties as are prescribed by applicable laws and regulations, the Articles of Incorporation, or resolutions of the Board of Directors. In addition, unless otherwise provided by applicable laws and regulations or the Articles of Incorporation, determine the matters for resolution set forth in the attached Detailed Rules of Audit Committee.

  • 2.
    The Audit Committee may require reports at any time from the Company’s Directors, Corporate Officers, and employees. Where necessary for the performance of its duties, the Audit Committee may also require reports from: officers and employees of ENW companies other than the Company; and the Company’s External Auditor.
    In addition, unless otherwise provided by applicable laws and regulations or the Articles of Incorporation, the Audit Committee shall receive reports on the matters specified in the attached Detailed Rules of Audit Committee.
  • 3.
    If an Audit Committee Member becomes aware of any actual or potential violation of applicable laws and regulations or the Articles of Incorporation, or any misconduct, by a Director or Corporate Officer, such member shall take action in accordance with Articles 406 and 407 of the Companies Act.

  Article 3 (Composition)

  • The Audit Committee shall be composed of Directors appointed by the Board of Directors (hereinafter called “Audit Committee Members”).

    • 2.
      The Chair of the Audit Committee shall be appointed from the Outside Directors by the Board of Directors.

  Chapter 3 Items Necessary for the Performance of Duties by the Audit Committee

  Article 4 (Items Necessary for the Performance of Duties by the Audit Committee)

  • The purpose of Articles 5 to 9 of these Rules are intended to set forth matters necessary for the performance of duties by the Audit Committee, in accordance with Article 416, paragraph (1), item (i), (b) of the Companies Act and Article 112, paragraph (1) of the Regulations for Enforcement of the Companies Act; provided, however, that the matters specified in Article 112, paragraph (1), items (iv) and (v) of the Regulations for Enforcement of the Companies Act shall be set forth in the Rules on the Development of Systems Necessary to Ensure the Proper Execution of Duties by Corporate Officers etc.

  Article 5 (Items regarding the employees who assist in the duties of the Audit Committee)

  • The Company shall establish a Management Audit Department to assist in the duties of the Audit Committee. The Directors shall not be assigned to assist in the duties of the Audit Committee of the Company.

    • 2.
      Staff of the Management Audit Department shall follow employment and work regulations of the Company for items not established by these rules.

  Article 6 (Items regarding the independence of the employees in the preceding Article from the Corporate Officers and items regarding ensuring the effectiveness of the instructions of the Audit Committee to such employees)

  • The Management Audit Department shall be established as an organization independent from the Corporate Officers and, under the direction of the Audit Committee, shall primarily perform the following duties:
    1) Conduct investigations and prepare reports based on the instructions of the Audit Committee and/or the audit plan.
    2) Perform administrative duties related to operations of the Audit Committee, including compiling meeting materials and preparing draft minutes.
    3) Serve as the corresponding secretaries with Corporate Officers and each department, the External Auditor, and Directors other than Audit Committee Members.

    • 2.
      The staff of the Management Audit Department shall be appointed, reassigned and disciplined by the Representative Corporate Officer and CEO with the consent of the Audit Committee.
    • 3.
      The decision on personnel evaluation of the staff of the Management Audit Department will be conducted by the Audit Committee.

  Article 7 (The system for Officers and employees of the ENW Entity to report to the Audit Committee)

  • The Audit Committee shall receive reports, in accordance with the Rules on the Development of Systems Necessary to Ensure the Proper Execution of Duties by Corporate Officers etc., from officers and employees of ENW companies, including Corporate Officers.

  Article 8 (Items regarding policies for the processing of expenses etc. that arise with respect to the execution of duties of the Audit Committee)

  • The Company shall bear all expenses incurred and obligations assumed in connection with the execution of duties by the Audit Committee.

  Article 9 (Other Systems to Ensure the Effectiveness of Audit by the Audit Committee)

  • The Representative Corporate Officer and CEO shall establish and maintain the systems within ENW companies necessary to enable the Audit Committee to perform its duties smoothly. The Representative Corporate Officer and CEO shall also take measures to ensure that the officers and employees of ENW companies are fully informed of the matters set forth in Articles 5 through 8 of these Rules.

    • 2.
      The Board of Directors and the Audit Committee shall, as necessary, establish any other systems required to ensure the effectiveness of audit by the Audit Committee, and shall require the Representative Corporate Officer and CEO and each Corporate Officer to take the actions necessary for their implementation.

  Chapter 4 Administration of Audit Committee meetings

  Article 10 (Convocation)

  • Audit Committee meetings shall be convened in principle by the Chair of the Audit Committee; provided, however, that any other Audit Committee Member may convene Audit Committee meetings whenever necessary.

    • 2.
      Notices of convocation of Audit Committee meetings shall be dispatched to each Audit Committee Member at least three (3) days prior to the date of the meeting, stating the date and time, place, and agenda of the meeting. Such period of notice may, however, be shortened in case of urgency.
    • 3.
      Audit Committee meetings may be held without conforming to the convocation procedures provided in the preceding paragraph with the unanimous consent of the Audit Committee Members.

  Article 11 (Holding of meetings)

  • Audit Committee meetings shall be held ten (10) times in principle each year. The timing of such meetings shall be specified in the audit plan and additional meetings may be held as necessary.

    • 2.
      Audit Committee meetings shall be held at the head office; provided, however, that a meeting may be held at some other place whenever necessary.
    • 3.
      Audit Committee meetings shall be held in the Japanese language. Interpreter(s) may be caused to be present at a meeting whenever necessary.

  Article 12 (Chair)

  • Audit Committee meetings shall be presided over by the Chair of the Audit Committee. In case the Chair is prevented from so doing, another Audit Committee Member shall act in the Chair’s place in accordance with the order previously determined by the Audit Committee.

  Article 13 (Methods of adopting resolutions)

  • Resolutions of the Audit Committee, except as otherwise provided by law, shall be adopted by a majority of Audit Committee Members present at each Audit Committee meeting where a majority of the Audit Committee Members who may participate in considering the resolution is present.

    • 2.
      An Audit Committee Member who has a special interest with regard to a resolution of the Audit Committee shall not exercise any voting rights with respect to that resolution. In such case, that Audit Committee Member’s voting rights shall not be counted towards the total number of the Audit Committee Members’ voting rights for that resolution.

  Article 14 (Reporting to the Board of Directors)

  • The Audit Committee Member appointed by the Audit Committee shall report the status of the Audit Committee’s performance to the Board of Directors without delay.

  Article 15 (Abbreviation of reporting to the Audit Committee)

  • Any matter that must be reported to the Audit Committee that a Director, an Corporate Officer or an External Auditor has notified to all Audit Committee Members need not be reported to the Audit Committee.

  Article 16 (Attendance of Relevant Persons for Agenda Item)

  • When the Audit Committee deems it necessary, it may invite Directors and Corporate Officers to attend an Audit Committee meeting and request explanations regarding matters on which reports have been requested from the relevant Directors or Corporate Officers. The Audit Committee may also require other persons to attend an Audit Committee meeting and to provide opinions, reports, or explanations.

  Article 17 (Minutes)

  • Minutes shall be prepared with respect to the substance of proceedings of Audit Committee meetings in compliance with law, and shall be physically or digitally signed or sealed by all Audit Committee Members present at the meeting.

    • 2.
      The minutes of Audit Committee meetings shall be kept at the Company’s head office for ten (10) years.

  Article 18 (Secretariat)

  • The Management Audit Department shall perform the clerical work of the Audit Committee.

  Chapter 5 Other items

  Article 19 (Revisions)

  • These Rules may be revised only by resolution of the Board of Directors.

   

  Supplementary Provisions

  (Enforcement)

  • Article 1
    These Rules shall come into effect on June 24, 2004.
  • Article 2
    These Rules shall come into effect on June 23, 2006.
  • Article 3
    These Rules shall come into effect on May 15, 2007.
  • Article 4
    These Rules shall come into effect on June 19, 2015.
  • Article 5
    These Rules shall come into effect on June 17, 2016.
  • Article 6
    These Rules shall come into effect on June 21, 2017.
  • Article 7
    These Rules shall come into effect on June 19, 2020.
  • Article 8
    These rules shall come into effect on June 18, 2021.
  • Article 9
    These Rules shall come into effect on June 17, 2022.
  • Article 10
    These Rules shall come into effect on June 18, 2025.
  • Article 11
    These Rules shall come into effect on June 17, 2026.

  (End)

  Detailed Rules of the Audit Committee

  1. Matters to be resolved

  • 1）
    Contents of the audit plan
  • 2）
    Results of audits conducted based on the audit plan, etc., and audit opinions regarding those audits (audit working papers)
  • 3）
    Contents of the audit report
  • 4）
    Dismissal of the External Auditor pursuant to Article 340 of the Companies Act (with the unanimous consent of all members of the Audit Committee)
  • 5）
    Submission to the shareholders’ meeting of proposals concerning the appointment and dismissal of the External Auditor, as well as not reappointing the External Auditor, and the contents thereof (if the External Auditor is absent and a new External Auditor is not appointed without delay, the appointment of a person to temporarily perform the duties of the External Auditor)
  • 6）
    Consent to remuneration, etc. for the External Auditor or a person who is to temporarily perform the duties of the External Auditor
  • 7）
    Matters concerning actions to pursue the liability of directors (excluding audit committee members, and including former directors; hereinafter the same in this item) or corporate officers (including former corporate officers; hereinafter the same in this item)

    • （1）
      Whether or not to file a lawsuit when a shareholder requests that a lawsuit be filed to pursue the liability of a director or corporate officer
    • （2）
      Whether or not the Company will participate in the lawsuit on the side of the plaintiff shareholder when notified by the shareholder of the filing of a shareholders' derivative suit
  • 8）
    Matters concerning the handling of internal whistleblowing reports to the Audit Committee
  • 9）
    Matters concerning prior consent to the appointment and personnel transfers of members of the Management Audit Department, as well as their performance evaluations
  • 10）
    Establishment, revision, and abolition of rules, etc. prescribed by the Audit Committee
  • 11）
    Other matters deemed necessary by the Audit Committee in relation to the execution of its duties

  2. Matters to be reported

  • 1）
    Reports from Corporate Officers invited to attend Audit Committee meetings, including:

    • （1）
      reports from the CFO on quarterly financial results
    • （2）
      a report from the CFO on the Accounting Documents
    • （3）
      a report from the Corporate Officers responsible for general affairs and share administration on the Business Report and Supplementary Schedules
    • （4）
      a report from the Corporate Officers responsible for internal audit
    • （5）
      a report from the Corporate Officers responsible for internal control and compliance promotion; and
    • （6）
      any other reports from Corporate Officers specified in the audit plan.
  • 2）
    Reports on major audit subjects.
  • 3）
    Reports from Corporate Officers, pursuant to the Rules on the Development, etc. of Systems Necessary to Ensure the Proper Execution of Duties by Corporate Officers, including

    • （1）
      monthly or immediate reports on incidents and similar matters
    • （2）
      reports on the retention and management of information
    • （3）
      reports on the management of risk of loss
    • （4）
      reports on internal control promotion activities
    • （5）
      reports on the results of internal audits and related matters
  • 4）
    Reports from External Auditor, including

    • （1）
      the annual audit plan of the External Auditor
    • （2）
      interim review reports
    • （3）
      accounting audit reports, including internal control audit reports
    • （4）
      matters concerning the performance of duties by the External Auditor under Article 131 of the Company Accounting Rules
    • （5）
      matters to be communicated to the Audit Committee under Auditing Standards Committee Report No. 260, etc.
    • （6）
      the status of discussions regarding Key Audit Matters (KAM).
  • 5）
    Reports from the External Auditor when the External Auditor discovers, in connection with the execution of duties by a Director or Corporate Officer, any fraudulent act or any material fact constituting a violation of laws and regulations or the Articles of Incorporation.
  • 6）
    Any other matters required by the Audit Committee in connection with the execution of its duties.  

  • Related Rules