Compliance

SUBARU has established the Risk Management and Compliance Committee, a company-wide organization designed to promote compliance. This committee deliberates, discusses, decides, and exchanges information on important matters related to risk management. Also, each department formulates their own implementation plan (compliance program) to promote compliance every fiscal year, and moves forward with continuous, systematic independent activities.

Compliance System

The Chief Risk Management Officer (CRMO), appointed by the Board of Directors, serves as chair of this committee, with the Risk Management and Compliance Office serving as its secretariat. Under the chair’s direction, the committee executes global and Group-wide compliance initiatives, regularly reporting these activities to the Board of Directors.

Compliance Hotline

When regular or temporary employees of SUBARU and its Group companies in Japan detect a problem related to compliance in the Group, they can consult with our Internal Reporting Desk by using the Compliance Hotline.
The Internal Reporting Desk is where employees assigned to the Risk Management and Compliance Office based on the relevant rules receive reports via mail, telephone calls, email, and websites, investigate facts, and provide response. We have also established a desk outside the Company staffed by external specialists to increase the hours in which service is available and to increase the confidentiality of those contacting the desk. Furthermore, we provide consultation services in four languages (English, Chinese, Portuguese, and Spanish) for foreign workers.
For consultations, the Risk Management and Compliance Office General manager plays a central role in investigating the facts of each situation and, subsequently, working to resolve issues promptly. Also, the Internal Reporting Desk reports to the proper management members and the Risk Management and Compliance Committee, working toward preventive measures.
There were 214 consultations in FYE March 2022, the details of which are outlined in the table below.
Through initiatives to raise awareness of this system, SUBARU has improved awareness of compliance and fostered an atmosphere where employees can consult even about trivial matters. This has resulted in an increasing trend in the number of consultations over the previous five years.

Compliance Hotline (Consultation and resolution procedure)

Breakdown of Compliance Hotline Consultations and Trend over Time

Training

In enforcing thorough compliance, we believe that initiatives in which the entire SUBARU Group acts in concert are necessary. We conduct compliance training, training for legal affairs in practical business, and other programs for all Group employees in Japan organized by our Legal Department, Risk Management and Compliance Office, and human resource and education departments.
In particular, more than 15,000 employees have participated in video-based training programs introduced in light of work environment changes due to COVID-19, as we work to improve compliance awareness for all employees at SUBARU and its Group companies in Japan. In addition, to complement compliance enlightenment training, study groups are held at each department and affiliated company based on their compliance program, covering important laws and regulations related to their work. These include export controls, the Act on the Protection of Personal Information, the Antimonopoly Act, and the Political Funds Control Act.

Compliance Implementation Support Tools

In order to promote compliance in everyday work, we create and provide various implementation support tools other than the Compliance Manual, such as in areas of specialization at affiliated companies.
To make knowledge of the Compliance Hotline common, we distribute cards containing information on the framework of the system and the contact address for consulting services, and also put up posters in all workplaces. We have designed the information cards and posters to deliver a message that encourages employees to proactively use the system even for things that feel only slightly suspicious.
In addition, we are making efforts for the timely report of highly urgent information and to call the entire Group’s attention to such matters.

Bribery Prevention

At SUBARU and its Group companies in Japan, we consider the prevention of bribery in the connection to our businesses as an important issue, and work to ensure the following approach is rigorously permeated.

• Prohibition of providing, offering, or promising improper entertainment, gifts, favors, or other economic benefits to public officials or persons in similar positions, whether in Japan or abroad
• Prohibition of providing or receiving an amount in excess of socially accepted norms in dealings with business partners and customers who do not constitute public officials or similar persons
• Prohibition of receipt of personal gain as a result of using information obtained in the course of business, establishing boundaries between public and private life

In addition, we have established the company-wide Bribery Prevention Rules, which clarify prohibited and non-prohibited acts when dealing with public officials. The SUBARU Group has also established guidelines on anti-bribery to clarify the conduct required of employees and executives. In China, taking into consideration unique social conditions, we created the Bribery Prevention Guidelines (with a Chinese translation included). It is distributed throughout our Chinese subsidiaries and forms the official rules of the relevant companies.
Also, anti-corruption is identified as an important issue in the Compliance Manual (Japanese and English versions) issued to affiliated companies in Japan and overseas. We not only require proper conduct regarding bribery to government workers but also pursue thorough fairness in transactions with private-sector customers and partners.
Under the monitoring system for bribery prevention, SUBARU collects information to ascertain the presence of cases that may constitute compliance violations through company-wide compliance activities, its whistleblowing system, and other channels. It also strives to use actions like internal audit departments’ business audits to detect cases early. Furthermore, SUBARU has established a system to report high-risk cases to the Risk Management and Compliance Committee and the Board of Directors, in an effort to strengthen oversight.

Security Trade Control

SUBARU, seeking to preserve the peace and safety of the international community, performs independent export control in accordance with the Foreign Exchange and Foreign Trade Act so that consumer products and technology that could be repurposed for military use, including weaponry, do not fall into the hands of countries developing weapons of mass destruction or terrorists (non-state entities).
We have regulations for the purpose of appropriate management of the entire group. Also, the Export Control Committee is a body that meets at least once a year to deliberate on Group-wide initiatives. It is comprised of executives from all departments involved in exports, chaired by the director in charge of the Legal Department.
With the goal of improving the level of its management, SUBARU also promotes PDCA cycles, including review of related rules, with a focus on the following initiatives.

• Export controls utilizing IT systems (from FYE March 2021, all export-related departments have begun using these systems)
• Utilization of proprietary checklists in accordance with relevant regulations and on-site voluntary inspections

Enactment of the Tax Policy

The SUBARU Group enacted its Tax Policy in June 2020. This basic policy sets forth our posture and way of thinking toward the tax laws we should comply with when paying the appropriate amount of tax.
In promoting tax strategy and risk management, these are reported to the Chief Financial Officer (CFO), who must approve these before submission to SUBARU’s Executive Management Board Meeting and the Board of Directors. Such matters are also reported to the accounting auditors during their audits and to the Board of Corporate Auditors upon request by the respective parties as appropriate.

Established in June 2020