Competition Laws/Anti-corruption Laws | Compliance | Governance | Sustainability | IHI Corporation

Approach

Commitment to Competition and Anti-corruption Law Compliance

IHI has established the Basic Code of Conduct for the IHI Group to be followed by all the officers and the employees of all the IHI Group companies. The CEO, along with all other members of the IHI Group, is fully committed to complying with all laws including competition laws, as well as anti-corruption laws.
The IHI Group revised the IHI Group Competition Law Compliance Policy in fiscal 2021 which now requires each group company to establish operational standards and appoint a management supervisor who is in charge of compliance in competition laws. The policy concretizes the Basic Code of Conduct for the IHI Group from competition law perspective, with the aim of strengthening its competition law compliance system. The IHI Legal Division is continuously taking initiatives to enhance compliance of competition laws and working together with IHI Group companies, providing supports in, for example, establishing effective operational standards that take into account the actual business settings of each group company to prevent any anti-competitive activities to occur.
The IHI Group aims to eradicate corruption and prohibits bribery, including facilitation payments and payment of unfair and unreasonable expenses and donations, to all persons, whether they are public officials or not, under the IHI Group Basic Policy Against Bribery of Public Officials established in 2015. To enhance the effectiveness of this policy, the IHI Group has obliged each group company to establish operating guidelines and appoint a chief administrator who is in charge of compliance in anti-corruption laws.

Governance

As a part of its internal control, the IHI Group regularly audits on each of its internal divisions and IHI Group companies to ensure that they are in compliance with the IHI Group Competition Law Compliance Policy and the IHI Group Basic Policy Against Bribery of Public Officials. Additionally, the IHI Group conducts risk assessments, education, and training on competition laws and anti-corruption laws, and reports the status of these activities to its Compliance Committee once every six months. Furthermore, the IHI Group aims to identify and address any compliance issues at the earliest possible stage through the Compliance Hotline.
If any serious compliance issues are discovered, the IHI Group will set up an emergency headquarters headed by the Chief Executive Officer to quickly and flexibly handle the issue, utilizing the expertise of internal and external experts. The emergency headquarters will follow up the matter until the implementation of measures to prevent recurrence are completed.

Risk Management

Competition Law and Bribery Risk Assessment

Every year, the IHI Group conducts assessment on risks to competition laws and anti-corruption laws for each department of IHI and each Group company, considering their respective business settings such as countries in which they operate and their business models. Based on the assessments, appropriate measures are taken.

Initiatives

Education/Awareness Building

In order to prevent anti-competitive behavior to occur, the IHI Group conducts anti-competition law training for all the officers and the employees of IHI Group, which covers competition laws in various countries, such as the Act on Prohibition of Private Monopolization and Maintenance of Fair Trade and Unfair Competition Prevention Act in Japan, the Sherman Antitrust Act in United States, and competition laws in the European Union.
Moreover, in order to prevent corruption, the IHI Group conducts awareness-raising activities and education regarding compliance with anti-corruption laws such as the U.S. Foreign Corrupt Practices Act and the UK Bribery Act. During fiscal 2023 the IHI Group expanded its scope of e-learning participants, resulting in a significant increase in the number of participants taking part in both training.
These training programs are provided to IHI departments and Group companies based on the results of risk assessments. In addition, the training materials are shared on the company’s intranet so that officers and employees are able to refer to them at any time. Also, the IHI Legal Division continuously reviews the effectiveness of the program by reflecting feedbacks from the participants or any development in laws to enhance compliance activities in subsequent years.

Training Participants (Total)

(Unit: People)

Item		Scope of Data	FY2022	FY2023
Officers and employees		IHI and consolidated subsidiaries	2,007	51,222
(Breakdown by topic)	Competition law	IHI and consolidated subsidiaries	622	26,148
(Breakdown by topic)	Anti-corruption law	IHI and consolidated subsidiaries	1,385	25,074
(Breakdown by region)	Japan	IHI and subsidiary companies in Japan	1,784	50,618
(Breakdown by region)	Overseas	Subsidiary companies overseas	223	604

Compliance with Competition Law/Anti-corruption Law

Competition Law/Anti-corruption Law Violations

(Unit: Incidents, Scope: IHI and consolidated subsidiaries)

Item	FY2020	FY2021	FY2022	FY2023
Competition law	0	0	0	0
Anti-corruption law	0	0	0	0

Expenditure to Political Organizations, Economic Organizations, and Other Major Industry Organizations

(Unit: Millions of yen, Scope: IHI)

Item		FY2020	FY2021	FY2022	FY2023
Expenditure	Political organizations	10	10	10	10
	Economic organizations	57	52	55	55
	Other major industry organizations	122	119	122	123

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