Compliance

1. Basic Approach

We have established the Skylark Group Charter of Corporate Behavior, and have shared this with all executives and employees so that they each behave with social decency and observe laws, international rules and their spirit. We position food safety and security as the highest priority issues, and make effort to thoroughly educate all executives and employees through the use of various manuals and other means.
In addition, we have stipulated the basis for compliance in the Group Compliance Regulations. By appropriately administering the policy, we aim to improve our levels of compliance and social credibility.

2. System for Promoting Compliance

The store managers play a key role in compliance at the individual stores, which are directly visited by customers. The managers offer services by following manuals and checklists, while internal audit departments which function independently of store operations check to make sure that measures outlined in these materials are observed. In addition to establishing the customer services center in order to utilize customer feedback and requests to improve the quality of our products and services, we created the QSC Improvement Committee as a vehicle to quickly respond to customer needs. Customer suggestions, opinions, and requests received at the Customer Relations Office are reported to management as "customer feedback" and are shared with relevant departments to review business operations and improve products and services.
At the headquarters, which supports the stores, the Group Risk and Compliance Committee, which is responsible for and supervised by the Board of Directors and consists of the Chairman, President, and all executive officers, deliberates important matters related to ethics and compliance of the Group and determines basic policies. Specifically, in addition to formulating Group policies and reporting on the status of compliance promotion at Group companies, the committee deliberates on measures to prevent violations, investigates violations when they occur, and corrects remedial measures, before confirming and reporting to the Board of Directors. This makes the Board of Directors the executive body that decides on and manages the progress of ethics and compliance initiatives, and the body responsible for the ethics and compliance of the Group. Our Internal Audit Group is responsible for checking and pointing out whether this promotion system is functioning and operating properly.
The Group's internal audits are conducted at least once a year, covering all divisions and operations within the Group, with audit themes based on the operational characteristics of each division.
With regard to ethics and compliance, in 2022, all departments and operations within the Group were audited twice each for items related to "Ethics and Compliance".
Since the internal audit in 2023, we have applied the Ethics and Compliance Management System Standard (ECS2000v1.2) to all departments to verify conformity to the requirements of the standard, effectiveness of each business process, and the status of continuous improvement.
The standard consists of a total of 67 requirements, and the overall framework is as follows.
Plan: To formulate a basic policy for compliance with ethics laws and regulations, develop an implementation plan to embody the policy, identify relevant laws and regulations, and develop internal rules and manuals.
Implementation: Define operational roles and develop training/education, operational management, document management, and emergency response accordingly.
Audit: Verify that the ethics policy is understood, that operations are conducted in accordance with role assignments, and that reporting/consultation and corrective/preventive systems are functioning.
Review: Management should organize and review areas for improvement based on audit results.
During the 2023 internal audit, one finding and one observation were detected, both of which have been appropriately corrected.
In addition, we have established the Skylark Group Internal Reporting Desk (whistle-blowing function), for which we have designated an outside specialty company as our point of contact, for the purpose of the early detection and correction of acts which violate laws and regulations or fraudulent acts which give disadvantages to customers, investors, communities, and other stakeholders. The internal reporting desk receives the whistleblowing from all executives, employees, and their families, and retired employees of our group companies in Japan and our suppliers. While privacy of the whistle-blowers will be respected, whistle-blower reports are shared directly with independent outside officers as well as our full-time Audit and Supervisory Committee members, and are reported to directors and corporate auditors on a regular basis in accordance with internal regulations.
Each overseas affiliated company also has its own internal reporting desk which we supervise and receive reports on.
In order to make the system and contact information known to all employees, the system is explained during employee training sessions, the contact information is posted on employees' work smartphones, and posters are displayed at each office and store.
Furthermore, in the event of a violation of the Code of Conduct, strict sanctions such as disciplinary action will be taken in accordance with the Employment Regulations and with the approval of the Awards and Disciplinary Committee in order to guarantee the employment of employees and to maintain order in the performance of their duties.

3. Establishment and Disclosure of Anti-bribery/Anti-corruption Policy

We conduct business operations, not only in Japan but also on a global basis through our overseas Group companies. Laws and regulations regarding bribery and fair competition in various countries around the world are becoming increasingly stricter. In order to comply with social ethics and laws and regulations in Japan and abroad, prevent any and all improper conduct, including corrupt practices (bribery, money laundering, anti-competitive behavior, improper conflicts of interest, etc.), and conduct fair and equitable transactions, the Group as a whole has established a new “Anti-bribery/Anti-corruption Policy” to further clarify its stance toward the prevention of bribery.

Anti-bribery/Anti-corruption Policy

４．Relationship with Politics and Government

With regard to interactions with external parties, we have established criteria for judgment and compliance with internal regulations to ensure fair business operations and a clear distinction between public and private matters.
Regarding relations with politics and government, the same regulations stipulate that the company shall comply with laws, regulations, and internal rules regarding political contributions, donations, and contributions, and shall not make donations or contributions that exceed the permissible range, and shall maintain healthy and transparent relations.

5. Training Programs on Ethics and Compliance Standards

Comprehensive training is provided to all Group employees (including part-time employees) regarding ethics and compliance standards.
As an example of a training program on ethics and compliance standards, all employees receive training when they join the company. In addition, training sessions are held for J2, J3, managers, and other employees at the time of promotion or salary increase, and the content of these training sessions is also included in promotion examination questions.
Also, we offer training opportunities as on-demand training so that employees can learn when they want to learn themselves. In addition, the latest information is regularly published in the monthly internal newsletter, and all employees are informed of the initiatives decided by the Group Risk Compliance Committee through store notifications.
In this way, we promote the strengthening of the Group's ethics and compliance efforts, including supplementing individual knowledge, by providing regular and comprehensive training to all employees.

6．Ethical Marketing and Advertising

We have established the following provisions for marketing and advertising in our "Voluntary Declaration of Customer Orientation".

1. （1）We will comply with laws and regulations, and conduct marketing, advertising, sales promotion, and display in a fair and easy-to-understand manner from the customer's perspective.
2. （2）We will continuously work to improve information related to food safety and security.
3. （3）Ensure proper marketing, advertising, promotion and labeling of food and beverage products.
4. （4）Marketing, advertising, promotion, and labeling based on the concept of proper drinking, including the prevention of underage drinking and drinking by drivers.

Based on the above policy, we will pay special attention in marketing and advertising the products and services we provide to children, and will ensure that our customers can easily understand the content of such marketing and advertising.
Appeals in information and advertisements strictly adhere to fair and accurate representation and comply with the prohibition of false and exaggerated advertisements (expressions that differ from the actual situation or exaggerate the actual situation) as stipulated by laws and regulations.
We also communicate our environmental and social initiatives and references to our competitors without exaggeration to avoid misleading our customers.