Compliance
- Compliance Structure of Tokyo Century Group
- Internal Reporting System
- Compliance Handbook
- Compliance Education
- Preventing Financial Crimes
- Preventing the Transfer of Criminal Proceeds
- Preventing Corruption
- Policy on Political Funds
Compliance Structure of Tokyo Century Group
Recognizing that ensuring strict compliance is essential for a company's continued existence, the Tokyo Century Group strives to establish a management system in which all officers and employees act with fairness and high ethical standards, thereby earning the broad trust of society.
Under this compliance structure, the Chief Risk Officer (CRO), appointed by the President & CEO, oversees group-wide compliance. Beneath the CRO, the Compliance Group of the Risk Management Division is responsible for promoting initiatives, providing education, and managing compliance across the Group in accordance with the compliance program, including human rights, anti-bribery, and anti-corruption efforts.
Within Tokyo Century Corporation, General Managers of divisions and branches serve as compliance officers responsible for their respective organizations, handling relevant matters and providing training in cooperation with the Compliance Group.
At consolidated subsidiaries, their president or an equivalent officer serves as the compliance officer, overseeing the establishment, maintenance, and management of their company's compliance system under the direction, guidance, and advice of the CRO.
For non-consolidated subsidiaries, the Compliance Group also provides guidance and advice regarding the implementation and management of their compliance systems.
The Tokyo Century Group’s compliance system, its operational status, and any identified compliance violations are periodically reported to the Management Meeting and the Board of Directors for effectiveness reviews. Based on the results, compliance promotion measures are formulated and executed.
Furthermore, to ensure all officers and employees maintain strict compliance, they are required to submit a compliance pledge once a year.
In fiscal 2025, there were no major compliance violations subject to public disclosure, including those related to human rights.
Internal Reporting System
The Tokyo Century Group operates an internal reporting system (a whistleblowing and consultation hotline) to detect and address risks at the earliest possible stage, enhance its organizational self-cleansing capabilities, and reinforce its corporate compliance. This system allows officers and employees to report directly without the intervention of their superiors, if they become aware of any compliance violations.
1. Outline of the Internal Reporting System
The internal reporting system is available to all officers and employees of the Tokyo Century Group in Japan and overseas, including Board members, permanent employees, contractors, temporary staff, seconded employees, part-time staff, and those who have retired within the past year.
We have established three reporting channels: the internal Compliance Group, an external legal counsel specializing in this field, and Standing Corporate Auditors to ensure independence. Reports can be made anonymously through any of these channels, regardless of their content. Submissions are accepted in Japanese and English in any format—either in writing (such as email) or verbally (such as by phone)—using the contact information available on the Company’s intranet and in the Group’s Compliance Handbook.
The system covers a wide range of reporting matters, including violations of the Antimonopoly Act that impede fair competition, corrupt practices such as bribery, violations of the Financial Instruments and Exchange Act that harm investor interests, harassment, and human rights abuses. It also extends to any other legal violations related to business operations, as well as misconduct that breaches corporate ethics or internal rules. Furthermore, the system allows users to seek consultation not only regarding actual or suspected compliance violations, but also whenever they have any compliance-related questions in the course of their daily duties.
Whistleblowers are under stringent protection. The Company strictly prohibits any disadvantageous treatment of whistleblowers, including disciplinary action and retaliation, and thoroughly ensures their anonymity while maintaining the absolute confidentiality of their reports. Personnel involved in handling these matters are designated as those engaged in whistleblowing response operations under Japan’s Whistleblower Protection Act. In accordance with the Act, they are under a permanent duty of confidentiality regarding any information that could identify or lead to the recognition of the whistleblower.
2. Response to Internal Reports
Upon receiving a report, the Company consults with the Chief Risk Officer (CRO) to determine the response while respecting the whistleblower’s wishes. If an investigation is deemed necessary, the Company promptly conducts a fact-finding inquiry. Except for anonymous submissions, the whistleblower must be notified promptly (within 20 days at the latest) of whether an investigation will be conducted, along with the reasons for the decision.
During this process, the Company imposes strict confidentiality on all individuals involved in or subject to the investigation. Furthermore, the Company prohibits any disadvantageous treatment of respondents or anyone cooperating with the investigation, providing them with the same protection as the whistleblower.
Timely reports on the status of the investigation are made to the CRO. In the event of a confirmed compliance violation, the CRO will implement corrective measures to address the issue, mitigate further loss, and prevent a recurrence, while drawing on the advice of legal counsel. This includes remedial action if the matter involves human rights violations or other abuses.
Material compliance violations will also be reported to the Company's President & CEO and the Corporate Auditors.
3. Status of Internal Reports
The issues received through internal reporting channels are broadly categorized into "rule violations," "harassment," "workplace environment," and "others." The number of cases, including reports from Group companies in Japan and overseas, has trended as follows, totaling 19 cases in fiscal 2025.
Appropriate corrective measures have been taken for all types of cases in accordance with their nature.
4. Review and Wider Use of the Internal Reporting System
The operational status of the internal reporting system and the responses to individual cases are periodically reported to the Management Meeting and the Board of Directors. Furthermore, the system is regularly reviewed and evaluated by our legal counsel, allowing the Company to implement improvements as necessary.
To encourage wider use of the system among all officers and employees, we continuously conduct compliance surveys to gauge awareness, share the system's purpose and significance through e-learning, and incorporate explanations of the system into various training themes.
Compliance Handbook
The Tokyo Century Group has prepared a Compliance Handbook that outlines the basics of compliance, making it accessible on the corporate portal at all times. The handbook covers key themes such as the Group's Management Philosophy Structure, Corporate Code of Conduct, compliance-related internal regulations, respect for human rights, the prohibition of harassment, and the prevention of both insider trading and corruption. All officers and employees can refer to and review the handbook at any time to deepen their understanding of compliance and ensure a shared awareness.
The Group has also created an English edition of the handbook for overseas subsidiaries, enhancing the compliance mindset globally.
Compliance Education
The Tokyo Century Group provides systematic and continuous compliance education to instill a compliance mindset throughout the organization. This includes rank-based training, e-learning programs for all employees (including officers, contractors, and temporary staff), and workplace compliance training conducted by compliance officers (such as the heads of divisions and branches).
Scrollable horizontally
| Targets (Training Methods) |
Major Subjects | Annual No. of Training Sessions |
|---|---|---|
| New employees |
Introduction to compliance
Information security
and others |
1 |
| New heads of divisions and branches |
Roles and responsibilities concerning risk management and compliance
and others |
1 |
| Mid-career hires (e-learning) |
and others |
As needed |
| All officers and employees (e-learning, video training) |
and others |
3 |
| Employees at divisions and branches (Workplace training conducted by compliance officers, the heads of divisions or branches) |
and others |
About 4 |
| Employees at overseas bases (Training for overseas assignees; workplace training conducted by compliance officers, the heads of overseas bases; and e-learning) |
Training for overseas assignees
|
As needed |
|
Workplace training conducted by compliance officers (base heads)
and others |
4 or more | |
|
As needed |
Preventing Financial Crimes
Tokyo Century Corporation recognizes the importance of taking action against money laundering, financing of terrorism, and proliferation financing (ML/FT/PF) and strives to prevent the Tokyo Century Group, its employees, and its customers from becoming involved in or affected by them.
The Group therefore works to prevent regulatory violations associated with ML/FT/PF while continuously strengthening its countermeasures to fulfill the requirements of the United Nations, the Financial Action Task Force on money laundering (FATF), and other international organizations and in compliance with the laws and regulations of Japan and other countries, including those imposed by the U.S. Office of Foreign Assets Control (OFAC).
A specific internal control framework and operations are stipulated in our Regulations for Anti-Money Laundering and Financing of Terrorism.
1. Establishment of a framework to prevent financial crimes
The Company recognizes measures against ML/FT/PF as an important management issue and will establish and maintain an effective control framework.
2. Commitment by management
The Company’s management takes a leadership role in preventing ML/FT/PF.
3. Identification, assessment, and mitigation of risks associated with financial crimes
The Company takes a risk-based approach to verifying and identifying risks related to ML/FT/PF that are relevant to the Company, assesses the risks identified, and takes appropriate action to mitigate the risks in light of the assessment results.
4. Customer verification
To ensure public security and sound economic practices, the Company takes Know Your Customer (KYC) measures in a timely and appropriate manner to prevent ML/FT/PF that encourages organized crime and to block any relationships with anti-social forces. To this end, we make use of databases and other tools to filter prospects prior to transactions, conduct customer due diligence, and perform ongoing transaction monitoring based on internal rules.
5. Notification of suspicious transactions
The Company will promptly notify the authorities in the event that it detects suspicious transactions based on customer due diligence, transaction monitoring, or through reporting by sales and other divisions.
6. Training of officers and employees
The Company provides ongoing training so that its officers and employees can deepen their knowledge of prevention of ML/FT/PF and take appropriate action at any time necessary.
7. Compliance auditing
To ensure appropriate operations regarding the prevention of ML/FT/PF, the Company conducts internal audits on a regular basis and strives to improve its internal framework.
Preventing the Transfer of Criminal Proceeds
Tokyo Century Corporation takes appropriate actions during transactions, such as pre-transaction verification, recordkeeping, and reporting of suspicious transactions, in accordance with the Act on Prevention of Transfer of Criminal Proceeds.
Under this act, we have established strict rules, which are enforced when it is considered necessary to conduct high-risk transactions that pose a greater degree of potential for money laundering or other illegal activities. In addition to the implementation of standard pre-transaction verification, these rules require the verification of the identity of each customer and the ultimate beneficial owner through a stringent method, as well as the decision—made by the supervisor of inspections of the verification—on whether or not to proceed with the transaction.
1. Transactions subject to pre-transaction verification:
- （1）Finance lease
- （2）Lending of funds and intermediation of loan transactions
- （3）Transactions concerning the purchase and sale of securities, including deemed securities, as defined by the Financial Instruments and Exchange Act
- （4）Transactions as an agency and intermediary for customers concerning the buying and selling of real estate
- （5）Other specified transactions as defined by the Act on Prevention of Transfer of Criminal Proceeds
- （6）Transactions that require special attention in regard to customer management
2. High-risk transactions that pose a greater degree of potential for money laundering or other illegal activities:
- （1）Specified transactions* where the counterparty is suspected of impersonating a customer or a formally designated person based on verified identities from previous transactions
- （2）Transactions with a customer suspected of having provided false information during verification for a specified transaction* in the past
- （3）Specified transactions* involving the transfer of assets with a customer residing in or located within a country or region specified by Cabinet Order
- （4）Specified transactions* conducted with foreign nationals who are politically exposed persons
*Transactions that fall under “1. Transactions subject to verification”
Preventing Corruption
The Tokyo Century Group is committed to preventing corruption by conducting fair, equitable, and transparent transactions in all our operating activities.
1. Initiatives for preventing corrupt practices
The Group makes a concerted effort to ensure strict compliance and prevent all forms of corruption. This includes preventing money laundering, terrorist financing, and proliferation financing; blocking any relationships with anti-social forces; prohibiting insider trading; and complying with both the Anti-Monopoly Act of Japan and international competition laws regarding cartels and bid-rigging.
2. Prohibition of bribery
Except as permitted by the relevant rules, the Group prohibits offering entertainment, cash, or any other benefits to domestic and foreign public officials* and engaging in behavior such as receiving, demanding, or promising illicit or unjustifiable business profit with the intention of obtaining favors, rewarding public officials for favors obtained, or gaining illicit profit, either directly or indirectly through agents, consultants, or any other third party.
*Includes public officials, quasi-public officials, foreign public officials, and officials and employees of special companies.
In our international business in particular, we strictly comply with the laws and regulations of Japan and other relevant jurisdictions, acting prudently and appropriately concerning entertainment and gifts involving foreign public officials.
- (1)Key considerations for providing entertainment and gifts to public officials
- ①Entertainment and gifts must have a legitimate purpose and should not be given with the intention of obtaining favors or rewarding public officials for favors obtained.
- ②Cost and other expenses must be within the scope of typical social norms.
- ③The location of meetings and handling of expenses must be open and transparent.
- ④Confirmation with the recipient must be made that the provided entertainment or gift does not violate any internal rules nor any public laws or regulations.
- ⑤If the recipient is a foreign public official, in addition to meeting the above requirements from ① to ④, it must be clear that the purpose is not to obtain illicit business profits, and the expenses must be kept within the customary and socially acceptable range of the country of the foreign public official.
- ①
- (2)Prohibition of entertainment and other benefits that violate social normsThe Group prohibits frequent entertainment or gifts to specific business partners and related parties, as well as excessively expensive entertainment in light of social norms and industry practices, and entertainment at inappropriate times (such as during bidding or selection processes). Furthermore, when providing or receiving entertainment or gifts, prior approval based on prescribed internal procedures is required to ensure appropriate management.
3. System and response
We ensure whistleblower protection so that no disadvantageous actions are directed toward any officer or employee who reports on, or who provides information concerning violations or potential violations of laws, regulations, or internal rules on preventing corrupt practices.
4. Education and training
To ensure that these anti-corruption initiatives are thoroughly understood and implemented by officers and employees across the Group, they are clearly laid out in our Compliance Handbook in Japanese and English and are also incorporated into e-learning and other in-house training as necessary.
Furthermore, we have compiled the Guidelines on Offering Entertainment to Public Officials in both languages, outlining key considerations to ensure compliance among officers and employees of overseas Group subsidiaries.
5. Reporting
The progress of initiatives for preventing corrupt practices is reported to and reviewed by the Management Meeting and the Board of Directors as part of the Group’s compliance systems and operations.
In fiscal 2025, no fines were imposed on the Group, and no officers or employees were dismissed or disciplined for corruption.
Policy on Political Funds
Tokyo Century Group Code of Conduct stipulates we act from a global perspective that is highly transparent and sincere, by respecting the cultures and customs of the countries and regions in which the Group operates and complying with all laws, regulations, and rules, in addition to conducting sound and fair corporate activities in accordance with social norms.
Our policy on political funds prohibits donations to political parties, political fundraising groups, other political organizations, and candidates for public office (e.g., politicians).
Therefore, no political contributions are recorded each year.
