Corporate Governance | Internal Control

Nomura Group is working to ensure proper corporate behavior throughout the Group by strengthening and expanding the internal control system with the objectives of securing transparency and efficiency in management, maintaining compliance with laws and regulations, conducting proper risk management, ensuring reliability of business and financial reporting, and promoting timely and appropriate information disclosure.

Internal Controls Structure and Processes

Given that Nomura Holdings, Inc. utilizes a committee-based system of corporate governance, the central role in business oversight is taken by the Board of Directors and the Audit Committee, the latter of which comprises a majority of outside directors. The chair of the Board of Directors is held by a non-executive director, allowing the Board to better oversee the business conducted by the executive offi cers. The Audit Committee is chaired by an outside director, making its independence from management even clearer. In addition, we have established an internal controls system based on a decision made by the Board of Directors, so as to ensure the effectiveness of audits. A non-executive but full-time director well-versed in Nomura Group's business and in company affairs is appointed as "Audit Mission Director", and we have established an Office of Audit Committee with the sole duty of providing support to the Audit Committee.
We have established the Group Internal Audit Department, which is independent from business divisions and, along with internal audit departments established in key subsidiaries and working under its direction, conducts internal audits of NHI and its subsidiaries, so as to ensure the effectiveness and suitability of internal controls. The Group Internal Audit Department acts under the direction of the Internal Controls Committee, and results of audits are reported not only to business lines, but to the Audit Committee and the Audit Mission Directors.

Internal Controls System

1. Two full-time non-executive directors (Audit Mission Directors) who are familiar with the business and organization of Nomura Group, are appointed as Directors of the Company and Nomura Securities. In accordance with the instructions by the Audit Committee, Audit Mission Directors conduct operational supervision to support the Audit Committee, including daily inspections and investigations such as attending important committee meetings.
2. An Audit Committee member and an Audit Mission Director participate as members of the Internal Controls Committee, a higher body of the Internal Audit Division. Moreover, internal audit results are reported to the Audit Committee and Audit Mission Directors as well as to executive management.
3. The Company has established Office of Audit Committee to assist the Audit Committee. Office of Audit Committee provides assistance to Audit Committee members and Audit Mission Directors and operational support to the Audit Committee.