Compliance

Approach to Compliance

To practice Tokyo Electron’s Corporate Philosophy, it is vital that each employee performs their daily duties with strong interest in and a deep understanding of compliance. We established “Tokyo Electron’s Code of Ethics” as a code of conduct to ensure that our employees are aware of the risks around them and conduct themselves appropriately. We have built a global system that can directly address questions and concerns about compliance and business ethics to quickly address potential problems.

Compliance System

In order to effectively promote a global compliance program, we have appointed a Chief Compliance Officer (CCO) and established a dedicated Compliance Department at our headquarters. Additionally, people responsible for compliance (Regional Compliance Controllers) have been appointed at key overseas sites, creating a system for direct reporting to the Chief Compliance Officer and Compliance Department. The primary role of the Compliance Department is to formulate and review our practical compliance programs, establish and implement business ethics, plan and implement education and training, and establish and operate internal reporting systems. It also cooperates with the Risk Management business Support Group established within our General Affairs Department, regularly confirms the observance of laws and regulations in each country as well as internal company rules at each Group company, and assesses compliance risks. Furthermore, the Internal Audit Department conducts operational audits based on annual plans, which leads to the improvement of findings as appropriate.

Representative Director, President & CEO General Manager of Legal, Compliance Unit Chief Compliance Officer Compliance Department (Headquarters) Regional Compliance Controllers U.S. Europe/Israel Korea Taiwan China Singapore/Malaysia

Compliance Initiatives

Business Ethics

In addition to establishing the Code of Ethics as the standard of conduct by which all executives and employees should abide, we have also established an Ethics Committee to promote and raise awareness of compliance and business ethics more effectively within the company. We have also set up the Disciplinary Committee as a subordinate organization of the Ethics Committee for the purpose of ensuring that reasonable and appropriate disciplinary action is taken and proper procedures are followed.

To ensure awareness of the Code of Ethics, we have translated it into five languages, including Japanese, and have distributed it in the form of a booklet to all executives and employees. In fiscal year 2021, the Code of Ethics was revised. In addition to reflecting standards required as a global company, we added a number of new provisions on such important issues as personal data protection, information security, and money laundering. In addition, in pursuit of clarity and usability, we have made changes to the booklet design and adopted a bullet point format. We are also striving to raise awareness of compliance and corporate ethics by regularly obtaining confirmation from all executives and employees that they understand and comply with the revised content.

Initiatives for Anti-Bribery and Corruption and for Competition Laws

In fiscal year 2021, we established the company-wide Basic Policy on the Prevention of Bribery and Corruption, and through regular education, we are working to promote understanding and awareness. Based on this basic policy, we have prepared the Guidelines for Gifts, Hospitality and Entertainment, which stipulate specific, practical procedures and standards on monetary amounts, and we have established a thorough process requiring prior approval for cases outside these standards. Using questionnaires that we have prepared, we also regularly check the status of our suppliers' efforts to prevent corruption and provide them with feedback on the results and areas for improvement as required.

We have also established the company-wide Basic Policy on Competition Law Compliance, and have prepared, disseminated and enforced guidelines that summarize different types of violations in an easy-to-understand format, based on applicable laws and regulations in the countries and regions in which we operate.

Compliance Training

We conduct online and face-to-face training adapted to different levels for all employees*. We will systematically expand our comprehensive training program and multilingual support, and reinforce efforts to foster compliance awareness and practice in the company.

* Training and seminar topics include basics of corporate ethics and compliance, anticorruption, export compliance, insider trading prevention, the Act for Subcontracting and the prevention of harassment. Some training is limited to certain employees.

Internal Reporting System

Preventing problems from occurring and resolving them before they become significant requires a system that allows employees to raise questions and concerns about business ethics and compliance without reservation or hesitation and to discuss them fully. For this reason, we have established an internal reporting system that ensures complete confidentiality, anonymity and the prohibition of retribution so that employees can safely and reassuringly provide information and seek redress outside the chain of command about behavior that is, or may be, in violation of laws, regulations or business ethics.

Specifically, we have established and are operating the Tokyo Electron Group Ethics & Compliance Hotline—a global common internal point of contact that uses a third-party system that is also accessible to our suppliers—as well as an external point of contact that allows direct consultation with an outside law firm. The internal point of contact can be accessed via phone or a dedicated website 24 hours a day, 365 days a year, and accommodates all languages used by employees.

Response to Internal Reports

Reports and consultations received via these points of contact are handled with sincerity, and investigations are undertaken in accordance with internal regulations. If a compliance violation is found, disciplinary action is taken in accordance with the Rules of Employment*, and preventive measures and corrective measures, such as improvements to the workplace environment, are implemented as necessary.

In fiscal year 2021, a total of 82 cases were received via the internal reporting system, of which 6 were recognized as compliance violations. The reports and requests for advice primarily related to harassment, but some concerned the improper reporting of attendance and breaches of internal procedures. As a result, we have conducted regular education programs for our employees to prevent harassment and have provided thorough follow-up with those concerned or involved. There were no reports or cases of non-compliance that could have had a serious impact on our business or on local communities.

* A leniency system has been introduced whereby any disciplinary action may be reduced or exempted in the event the employee involved in a compliance violation has made a report or sought advice on his/her own volition.