Corporate Governance

Tokyo Stock Exchange, Inc.

Update : Jun. 22, 2011

Executive Officer System and Board of Directors

TSE has an executive officer system to streamline the decision-making process and to clarify the authority and responsibility of its operational and administrative functions. The Board of Directors consists of 12 or less members (10 members as of June 21, 2011.) Also, 6 of these 10 directors are appointed from outside the company in order to increase the transparency and accountability of management, raise the legitimacy of operations, and fortify the board's supervisory function. Six external board members are from listed companies, etc. All of them have a deep insight in their specific field of expertise. As a general rule, our Board of Directors meets once a month to determine basic policies, discuss important matters and oversee the execution of business operations by our executive officers.

Advisory Committees

TSE maintains Advisory Committee consisting of market participants and neutral third parties in order to represent a wide range of opinions in our operations and to advise the Board of Directors. The Market Structure Committee deliberates issues associated with transactions, settlements, and listings. During FY 2010, which ended on March 31, 2011, the Market Structure Committee met two times.

Statutory Auditors Board

TSE currently operates under an auditor system. Our Statutory Auditors Board consists of four individuals (including one standing statutory auditors), three of whom are external auditors. Of the three external auditors, two are lawyers, and one is a standing statutory auditor who was previously employed at the Bank of Japan (Japan's Central Bank). To support our Statutory Auditors Board, we have established an Auditors Office.

The statutory auditors attend significant meetings, including Board of Directors and Executive Officers meetings, and conduct audits with a focus on the compliance aspects of TSE's operations. They also coordinate their efforts with the financial auditors, the internal auditing team and the statutory auditors of TSE's subsidiaries to improve the overall efficiency of TSE's accounting and operational audits.