Compliance

We believe that key actions to earn the trust and understanding of society pertain to the DENSO Group’s observance of all applicable national and regional laws and all Group employees’ fair and faithful conduct that embodies the highest ethical standards. Based on this recognition, in 2006 we adopted the Code of Conduct for DENSO Group Associates, which clearly indicates the standards of conduct for each and every employee. In training and at workplace conferences, we utilize the Code of Conduct for raising employees’ awareness of compliance at DENSO CORPORATION and all domestic Group companies. Overseas Group companies use a regional version of the Code of Conduct for DENSO Group Associates, formulated by their regional headquarters in accordance with national and regional laws and customs.

For compliance themes that are deemed particularly important, we have formulated individual policies and ensure that all employees are fully aware of them. A representative example is the “Global Anti-Bribery Policy,” which requires all employees to have a proper understanding of relevant laws, regulations, and internal rules, and to act in compliance with them.
If any employee discovers any conduct or suspected conduct in violation of the Code of Conduct, such as potential cartel activities, embezzlement, theft, bribery, conflicts of interest, and other acts of corruption as well as sexual harassment, abuse of power and other forms of harassment, and discrimination and other issues related to human rights, the employee is encouraged to report the matter to his/her supervisor, a specialized department, or the “Internal Reporting System (Whistleblower System)” or other consultation services established and operated by the company. In addition, the Company's internal regulations stipulate that necessary investigations should be conducted into the reported case reported.

DENSO created the Risk Management Meeting chaired by the Chief Risk Management Officer and the Chief Compliance Officer (CRO & CCO, appointed from a member of the Board) to deliberate and discuss the direction and action plan of activities to ensure compliance.
We have also installed committee structures, such as the Compliance Committee, and appointed compliance promotion officers, and have positioned such compliance leaders at the regional headquarters of each region of our collective global base. In doing so, we are building global systems that promote compliance, while at the same time promoting the development of organizational structures that take differing regional characteristics into consideration, introducing and operating reporting systems, and pursuing enlightenment activities.
Furthermore, personnel in charge of legal affairs in Japan, North America, South America, Europe, China, Southeast Asia, India, and South Korea exchange information and share issues with each other on a regular basis in an effort to further establish and promote compliance.

DENSO implements various educational and enlightenment activities for full-time employees and contractors on an ongoing basis with the aim of enhancing their overall awareness of compliance matters.
For example, in Japan, we carry out the following educational and enlightenment activities related to compliance. We also roll out activities for employees in each region of operation, centered on our regional headquarters, which are carried out in the same manner in which they are conducted at DENSO CORPORATION.

From fiscal 2024, the number of participants in e-learning courses will increase following our efforts to provide personnel in the Manufacturing Division with tablet devices.

In accordance with the circumstances in each region of operation, the DENSO Group has set up internal reporting systems at its regional headquarters and each business site. These systems allow employees to report their concerns and receive consultation on matters related to legal and regulatory violations (including potential cartel activities, embezzlement, theft, bribery, conflicts of interest, and other acts of corruption as well as sexual harassment, abuse of power and other forms of harassment, and discrimination and other issues related to human rights) via email, telephone, written correspondence, or face-to-face interaction.
For example, at DENSO CORPORATION, we have established a Business Ethics Hotline that allows anonymous reporting; is independent from the normal chain of command; and is administered by outside attorneys and the Business Ethics Hotline Secretariat in accordance with Japan’s Whistleblower Protection Act.

To ensure that employees can use the Business Ethics Hotline with peace of mind, we have formulated internal regulations for the operational use of the hotline, which are thoroughly communicated internally. These regulations clearly establish a confidentiality obligation that protects the privacy of whistleblowers and prohibit the unfair treatment of whistleblowers because of a report that they had made or consultation that they had sought. Furthermore, this hotline can be used by all persons working at DENSO CORPORATION, including employees, contractors, temporary employees, and employees contracted from other companies, as well as principal suppliers.

In addition to the Business Ethics Hotline, we have set up specialized consultation services, including the Harassment Consultation Center, the Consultation Center for Employees with Disabilities, and the LGBT Consultation Center, to address human rights issues that may arise in the workplace, as well as the “All Consultations Welcome Office,” which accepts reports and consultations on a broad range of issues. In the same manner as the Business Ethics Hotline, the aforementioned centers are operated under the premise of confidentiality and no unfair treatment for the reporting individual.
We also accept reports and consultations from outside the Company, including from local residents, via our corporate website, in accordance with our Privacy Policy.

In fiscal 2025, the hotline received 130 reports and consultations regarding matters such as employment, labor, work environment, information management, business transactions, and accounting, all of which were addressed appropriately after staff investigated the situations and confirmed the facts. The results of such investigations are reported to the relevant officer (chief risk officer), and the status of the consultations are disclosed via the company intranet under the basic premise of confidentiality and anonymity.
After the amendment to the Whistleblower Protection Act that was enacted in 2022, the number of reports and consultations regarding harassment to the Business Ethics Hotline and the Harassment Consultation Center is on the rise. There has been growing interest in internal reporting systems, and the number of reported cases is expected to continue to increase in the future. Looking ahead, we will strengthen collaboration with relevant divisions as we work to swiftly carry out investigations and response measures to reports and consultations received.

DENSO conducts inspections to ascertain whether its compliance activities have sufficiently taken hold and to look for any potential compliance issues. Additionally, if an issue is discovered, reports are made to top management etc. when necessary, and steps are taken to prevent a recurrence of the issue.
In addition, DENSO conducts compliance audit annually by the audit section or supervising division, which scope is for all organizations and groups. The results of these audits and surveys are used to make improvements. Furthermore, DENSO CORPORATION conducts a sustainability survey every year in order to gain an understanding on the extent to which compliance-related measures have taken hold and on potential compliance risks.

Sustainability survey (DENSO CORPORATION)
Question: Are you implementing the Code of Conduct for DENSO Group Associates? (percentage of respondents who answered “yes”)

In February 2010, the U.S.-based subsidiary DENSO International America was investigated by the U.S. Department of Justice. We took the matter very seriously and, since then, we have established the Antitrust Laws Compliance Committee to further reinforce our existing efforts to comply with antitrust laws.

Furthermore, under the guidance and supervision of this committee, which is chaired by the chief compliance officer (CCO), we are continuing to endeavor to reinstitute strict compliance with antitrust laws across the entire DENSO Group by ensuring strict adherence to laws and regulations, strengthening education about relevant rules, and conducting more precise audits regarding legal compliance.

Corruption is not only a hindrance to legitimate business activities but also a source of concern due to its connection with the funding of antisocial forces such as terrorist and criminal organizations. As a result, many countries around the world are strengthening their regulations against acts of corruption, including the United Kingdom’s Bribery Act (UKBA), and the United States’ Foreign Corrupt Practices Act (FCPA).
In accordance with the DENSO Group Sustainability Policy, DENSO is committed to conducting sound and fair business activities with high ethical standards. For example, DENSO is committed to practicing compliance with anti-corruption laws and regulations in all regions and countries in which it conducts business activities to ensure that it does not provide benefits or advantages through illegal or improper means such as bribery, illegal political contributions or donations; through threats, extortion, or embezzlement; or by engaging in money laundering, illegal international money transfers, or the funding of antisocial forces.
The main initiatives we will implement are as follows.

In order to respond promptly to rapid changes in its businesses and in the external environment, DENSO has established the Anti-Bribery Compliance Committee. The Company is promoting anti-bribery compliance activities under the direction and supervision of the committee, which is chaired by the CCO, in anticipation of an increase in opportunities to collaborate with public authorities and officials in various countries and regions.

The Company has established the Global Anti-Bribery Policy as its basic policy for preventing bribery. Under this policy, DENSO has established internal regulations on a global basis, operates anti-bribery systems, and promotes anti-bribery awareness activities and education for employees.
We also inform suppliers of our Supplier Sustainability Guidelines, which include anti-bribery measures, and conduct self-inspections to prevent acts of bribery by our suppliers.

To ensure fairness and soundness in the securities market and to secure the confidence of shareholders and investors, DENSO has established the Internal Information Committee, which is chaired by the executive vice president, and the Internal Information Review Committee, which manages the practical affairs of the Internal Information Committee to ensure the implementation of thorough measures against insider trading.
Additionally, in an effort to instill an awareness of insider trading prevention among its employees, the Company has established internal rules and bylaws regarding internal information management and standards of conduct for officers and employees concerning the trading of company shares and other securities; clearly states the prohibition of insider trading in its employee conduct guidelines; and conducts compliance-related educational activities on a regular basis, among other initiatives.

DENSO has established and maintains Company rules and procedures for the handling of expenses, inventory, and other matters, and ensures that all employees are aware of said rules and procedures by sharing relevant information via the Company intranet, and providing accounting compliance education along with other measures. The aim of such measures is to ensure that transactions that could lead to accounting irregularities, such as off-balance-sheet transactions, fictitious transactions or other unsound transactions, or transactions that could be mistaken as such, are not conducted, and that proper accounting procedures are performed in accordance with International Financial Reporting Standards and the laws and accounting standards of each country in which the Company operates.
Moreover, the Company creates and maintains accounting records, such as forms and account ledgers, that in reasonable detail accurately and fairly reflect all transactions and dispositions of assets.

DENSO is working on a Groupwide basis to ensure appropriate transactions and adhere to laws and regulations. To that end, the Company has been engaging in close communication with each of its suppliers, promoting discussion on cost fluctuations and working to assess issues suppliers face. Amid the soaring costs of various goods, including not only unavoidable increases in raw material and energy costs but also rises in wage levels, we have been working to appropriately pass on costs to customers within the supply chain, seeking to set in motion a virtuous cycle across the industry and the domestic economy.
Moreover, we encourage suppliers to utilize our Internal Reporting System. We also distribute the DENSO Compliance Declaration, which clarifies items to be observed in conducting business, to suppliers and procurement departments. Additionally, we offer anonymous surveys to suppliers on fair transactions and carefully reflect on the unfiltered feedback that we receive. In these ways, we are working to ensure strict compliance and make　improvements to better meet supplier needs.

As corporations seek to promote diversity, the forms of harassment　are also becoming more diverse. In light of these circumstances, we are strengthening our initiatives to prevent harassment based on a zero-tolerance policy against harassment. To ensure behavior in accordance with the DENSO Group Human Rights Policy, we clearly state the prohibition of harassment within our Code of Conduct. Additionally, we promote awareness-raising activities such as educational training for employees at each Group company.
For example, at DENSO CORPORATION, we provide harassment prevention training for all workplace leaders, including department heads and all supervisory personnel above that position, as well as section and team leaders. Aside from harassment prevention measures, including studying trends and response strategies using case studies based on a wide range of specific harassment behaviors, this training covers methods for creating harassment-free workplaces and handling harassment when it occurs in nearby settings.
In fiscal 2024, DENSO CORPORATION and domestic Group companies introduced new training for regular employees, in addition to the conventional web-based education. This new training includes discussions at the workplace to promote a proper understanding of harassment and systematically address harassment prevention.
In FY2025, a small group meeting on harassment has been held at each workplace every month since October, using video materials, to promote correct understanding of harassment and prevent harassment. In addition, all employees are surveyed on their awareness of harassment, and managers and supervisors are given the opportunity to self-assess their risk of harassment to ascertain changes in employee awareness and to help in the formulation of harassment prevention measures.
Moving forward, we will continue to implement harassment training and prevention activities to increase knowledge and awareness of harassment issues and its prevention and further improve our response capabilities when harassment does occur. In these ways, we will aim to create a fulfilling workplace culture in which employees can draw on their abilities to the greatest extent possible.

In the future, we will continue to upgrade and strengthen our structure for raising the compliance awareness of each and every employee as we work to raise the level of the compliance structure across the entire DENSO Group.