Corporate Governance at Hino Motors

The Corporate Mission of the Hino Motors Group is "to make the world a better place to live by helping people and goods get to where they need to go―safely, economically and with environmental responsibility―while focusing on sustainable development." Achieving the mission is essential as one of management's priority tasks: attaining stable growth over the long term and raising the Company's corporate value. To this end, Hino Motors will first and foremost offer beneficial products and services to its customers, while striving to strengthen its bonds with its stakeholders and conducting business activities from a sound management platform. With this stance, Hino Motors, as an expanding global company, is adopting a variety of measures designed to enhance its corporate governance as it endeavors to further strengthen competitiveness.

Corporate Governance Framework

The Board of Directors and Management Committee

Hino Motors' Board of Directors comprises 13 directors as well as two full-time corporate auditors and three outside corporate auditors, one of whom is an independent auditor as required by the Tokyo Stock Exchange and Nagoya Securities Exchange. The Board of Directors makes decisions on important management matters, and supervises the execution of the duties of directors.

Hino Motors' Management Committee is made up of the directors and full-time auditors. It is responsible for deliberating and deciding on important issues for management and basic management policies of the Company as well as the Group as a whole. These are resolved by the Board of Directors when necessary, in accordance with laws, regulations and company rules.

Operating Framework

Hino Motors has adopted a managing officer system. It is designed to facilitate swift and efficient decision-making by delegating business execution authority to managing officers under the direction and supervision of the Board of Directors. Managing Officers Meetings, which consist of all the members of the Board of Directors and the Managing Officers, are held to share information and report on important matters related to the execution of business operations.

Auditing System

Hino Motors employs a Board of Company Auditors as defined by the Companies Act of Japan. It comprises five company auditors, three of whom are appointed from outside the Company. In this manner, Hino Motors strives to ensure open and fair management. Company auditors attend meetings of the Board of Directors as well as all other internal meetings considered of importance, and audit the status of management and business execution.

Internal Control Initiatives

Hino Motors is active in its efforts to promote a sound internal control environment with the aims of enhancing and improving corporate governance. In addition to the business audit functions conducted by the Board of Company Auditors and the supervising functions conducted by the Board of Directors, Hino Motors' basic internal control system is supported by a structure of cross-sectional meetings, which include meetings of the Board of Directors and the Management Committee where important matters are comprehensively deliberated and decided. In May 2006, the Company, encompassing its subsidiary companies, adopted the Basic Policy on Establishing a System to Ensure the Appropriateness of Business Operations of the Company (Establishment of an Internal Control System).

■Corporate Governance Framework