Corporate Governance

Guided by its corporate philosophy of "creating a new world of communications culture," DOCOMO's management policy is to maximize corporate value so as to earn a high degree of trust and recognition from shareholders and customers. To this end, the Company will help to achieve a vibrant and enriched society by promoting mobile multimedia through the provision of services useful to customers'lives and businesses. At the same time, the Company will strive to enhance and bolster its core businesses with an emphasis on promoting wider adoption of FOMA and Xi services.
The Company believes that maintaining effective corporate governance is crucial to continuously increasing corporate value. Aiming to achieve the goal of ensuring promptness, transparency and soundness in its business management, the Company has been working to establish a governance structure that allows it to both make management decisions without delay and reinforce its audit and internal controls, as well as to improve its communications with stakeholders.

The Company has adopted a corporate governance structure led by the Board of Directors, which makes decisions on execution of important business and supervises the execution of duties by directors; and the corporate auditors/Board of Corporate Auditors, which audits the execution of duties by directors independently of the Board of Directors.
Also, the Company has introduced the corporate officer system and transferred a portion of business execution authority from the Board of Directors to the representative directors, corporate officers, and executive officers to enable agile business execution by the responsible corporate officers.
Furthermore, more than half of the members of the Board of Directors are assigned the responsibility of serving concurrently as corporate officers. As a result, the effectiveness of the mutual supervision of the members of the Board of Directors in business execution is enhanced, and the management supervision function is strengthened.

Our business execution and management supervision mechanisms are summarized in the figure below:

The Board of Directors consists of 13 members, including one outside director. In principle, the Board of Directors meets once a month, and extraordinary meetings are convened if necessary. In this way, decisions are made on important business matters, status reports are received as needed from Board of Directors members assigned the responsibility for business execution, and management supervision is implemented.
For decision making on important matters related to business execution, the Company has established the Management Committee, which includes the president and chief executive officer, senior executive vice presidents, executive vice presidents and full-time corporate auditors. The Management Committee meets in principle once a week, and extraordinary meetings are convened if necessary, to enable flexible, rapid decision-making by the president and chief executive officer.

The Board of Corporate Auditors consists of five members, including three outside corporate auditors. The Board of Corporate Auditors in principle meets once a month to make decisions on audit policies, plans, methods, and other important issues relating to the audit of the Company. Each corporate auditor, in accordance with audit policies and audit plans determined by the Board of Corporate Auditors, attends important meetings, such as meetings of the Board of Directors, and receives reports from directors, examines important documents, and conducts on-site examinations of the head office, major work sites, and major subsidiaries. In this way, corporate auditors appropriately conduct audits of the status of execution of duties by the directors and report to the Board of Corporate Auditors on the status of audit implementation. The Company's corporate auditors promote mutual understanding and information-sharing with the corporate auditors of subsidiaries. Corporate auditors ensure the effectiveness of audits by collaborating and exchanging information on audit plans and results with the Internal Audit Department, an independent unit established to perform internal audits of the Company and its registered public accountants on a regular basis.

The Company has established an advisory board composed of experts in various fields, including an advisory board in the United States to receive advice from a global viewpoint. In this way, the objective opinions and proposals of advisory board members regarding management issues facing the Company are reflected in management. To ensure that it receives a diverse range of advice, the Company invites advisory board members from various walks of life to sit on the advisory board, including prominent business leaders, university professors, commentators, and journalists.

• Period of establishment

October 2011 - September 2013 (planned)

• Board members

Motoshige Itoh	Professor, Faculty of Economics, The University of Tokyo
Shin Kikuchi	Partner, Mori Hamada & Matsumoto
Koh Koike	President and CEO, Representative Director, Oricon Inc.
Main Kohda	Novelist
Masaaki Shintaku	Special Olympics Nippon Executive Vice President
Jitsuro Terashima	Japan Research Institute CEO Tama University President
Taizo Nishimuro	Adviser to the Board Toshiba Corporation Chairman, The Japan Institute of International Affairs
Hideo Miyahara, Ph.D.	President, National Institute of Information and Communications Technology
Dr. Teruyasu Murakami	Senior Fellow, Nomura Research Institute, Ltd.

• Period of establishment

October 2011 - September 2013

• Board members

Mr. Tom Wheeler [Chairman]	Managing Director, Core Capital Partners Former CEO of Cellular Telecommunications & Internet Association (1992-2004)
Dr. Michael Katz	Professor, University of California, Berkeley Former Chief Economist of the Federal Communications Commission (1994-1996)

• Guest for the 1st meeting

Professor Pankaj Ghemawat

Professor, IESE Business School

Matters regarding the compensation of directors are determined by the Board of Directors. The compensation of directors (excluding outside directors) comprises monthly compensation as well as bonuses. Monthly compensation is paid in accordance with such factors as the importance and scope of responsibilities for each management level. Bonuses are paid in consideration of such factors as the Company's results. To reflect results over the medium-to-long term, a portion of monthly compensation is contributed to a director stock purchase plan through the Director's Shareholders Association. The shares of the Company that are purchased through the plan are held throughout the term of office.
In consultation with corporate auditors, it has been decided to pay only monthly compensation to corporate auditors in order to ensure a high degree of independence.
A summary of the aggregate amounts of compensation paid to directors and corporate auditors for fiscal 2010 follows:

Position	Number	Total Compensation
Directors	14	514 million yen
Corporate auditors	5	129 million yen
Total	19	643 million yen

The above total includes the following compensation to outside directors.

Position	Number	Total Compensation
Outside directors	3	69 million yen

The above includes two directors who retired at the conclusion of the 19th Ordinary General Meeting of Shareholders held on June 18, 2010.

Companies listed on the NYSE must comply with certain standards regarding corporate governance under Section 303A of the NYSE Listed Company Manual. However, listed companies that are foreign private issuers, such as NTT DOCOMO, are permitted to follow home country practice in lieu of certain provisions of Section 303A. To see the significant differences between two standards, please see the page below.

Significant Differences between Corporate Governance Practices of NTT DOCOMO and NYSE-listed U.S. companies

A summary of the Board of Directors resolutions concerning the development of systems to ensure the propriety of NTT DOCOMO's business activities (internal control systems) is set forth below.

1. In fortifying the internal control systems, we aim to achieve legal compliance, management of loss risk and appropriate and efficient business operations and consider various measures, including regulations, organizational and structural improvement, formulation of action plans, and the monitoring of activities.
2. An internal control committee will be formed as an entity overseeing efforts to have the internal control systems function more efficiently. The committee will aim to fortify internal control systems from the cross-departmental perspective; upon assessing efficacy, necessary improvements will be carried out.
3. Appropriate efforts will be made with regard to ensuring the reliability of the internal control systems, which will be involved with the financial reporting based on the U.S. Sarbanes-Oxley Act and the Financial Instruments and Exchange Act.
4. The Board of Directors will approve the basic policy on fortifying internal control systems (the Basic Policy), receive regular reports on the progress of the initiative to fortify internal control systems, and oversee and monitor the internal control systems of DOCOMO.
5. As chief executive officer, the president and representative director will oversee the efforts to build the internal control systems based on the Basic Policy approved by board members.

We institute the "NTT DOCOMO Group Code of Ethics" and compliance-related regulations and create requisite systems for ethical and legal compliance. In addition, when preparing financial statements, officers responsible for finance, corporate auditors, and independent auditors hold preliminary discussions of significant accounting policies, and for disclosure of company information including financial statements in a manner that conforms with securities-related laws and regulations, matters are decided at meetings of the Board of Directors after the necessary internal procedures pursuant to in-house regulations have been completed. Also, internal audit staff conducts audits of our overall business activities to ensure conformity with laws and regulations and in-house regulations.

Information relating to the performance of duties by directors is recorded and stored in accordance with rules stipulating the methods of storage and administration of documents and administrative information.

Executive directors responsible for risk management periodically summarize information relating to risks in their organizations in accordance with rules concerning risk management, and the internal control committee made up of directors, senior vice presidents, and others identifies risks as necessary for companywide risk management, and decides management policy for identified risks to prevent risks from occurring and to take rapid countermeasures in the event that risks do occur.

The efficiency of the performance by directors of their duties is ensured by such means as decision-making rules based on internal regulations and the specification of powers relating to their duties, the formulation of medium-term management policies and business plans by the Board of Directors, and the establishment of committees composed of directors, senior vice presidents, and others.

Based on rules governing fundamental matters relating to the management of our Group companies, group companies discuss important business matters with DOCOMO or report them to DOCOMO. In addition, officers with responsibility for corporate ethics who are appointed at subsidiaries report to DOCOMO in a timely manner on the state of problems involving senior management, and DOCOMO provides necessary guidance. With respect to unusual transactions with the parent company, investigations are conducted by legal personnel and audits are conducted by corporate auditors. Further, audits by internal audit personnel are directed to cover its subsidiaries, and whenever necessary they obtain and assess the results of the internal audits of those companies.

The Corporate Auditor's Office is established as an organization dedicated to assisting the corporate auditors with the performance of their duties, and specialist staff are assigned to it. We provide the Board of Corporate Auditors with advance explanations concerning matters such as appointments and transfers of these personnel and their job assignments, and pay respectful attention to the board's opinions before acting on such matters.

Directors, senior vice presidents, and employees report promptly to the corporate auditors and to the Board of Corporate Auditors concerning matters prescribed by laws and regulations as well as requested matters necessary for the performance by the corporate auditors of their duties.

Representative directors and the Board of Corporate Auditors hold regular meetings and develop an auditing environment necessary for enabling the corporate auditors to perform their duties. In addition, the internal audit staff coordinate with the audits by the corporate auditors to ensure auditing is conducted in a collaborative manner.

The corporate group led by our parent company, NIPPON TELEGRAPH AND TELEPHONE CORPORATION (NTT), operates the following main businesses: the regional communications business, the long distance and international communications business, the mobile communications business and the data communications business. As of March 31, 2011, NTT owned 66.65% of the voting rights of the Company and was in a position to influence the Company's management decision-making through the exercise of majority shareholder rights. However, the Company has its own management responsibility and conducts operational management in accordance with its own decision-making.

Each of our employees is instructed to follow the NTT DOCOMO Group Code of Ethics. Ensuring that activities are based on high ethical standards is the foundation of our compliance management. In addition, in order to increase the effectiveness of compliance management, we have strengthened the compliance promotion system, which is centered on Compliance Promotion Committees, and are building an information consultation system pertaining to compliance with ethics and laws. In addition, all divisions have employees with responsibility for compliance promotion, and at least once a year we implement employee education and training in ethics and legal compliance. We have carried out initiatives to enhance awareness of compliance on a companywide basis, including a compliance awareness survey of every employee, the results of which were reflected in our various measures to ensure compliance.

(Open this content in a new window)Code of Ethics

In conjunction with the full-fledged implementation of Personal Information Protection Law in April 2005, we established an Information Security Department, a unit overseeing our overall information security issues, which leads and manages our activities pertaining to the protection of customers' personal information, countermeasures against possible information leakage, development of our internal information control policies, and establishment and/or revisions of internal rules and codes. We have employed various measures to ensure the security of information, for example, by thoroughly administering terminals containing personal information, providing education to employees who handle personal information, supervising contracted companies, and strengthening the checking on the level of technical security employed. We have also established controls and procedures concerning disclosure of corporate information in accordance with domestic and overseas laws and regulations, and will disclose information in a timely, appropriate and proactive way to shareholders and investors to improve transparency.

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