Exhibit 11
Code of Ethics (English Translation)
Introduction
The globalization and liberalization of national economies and financial
services, as well as the advance of new information technologies, has
intensified competition among financial institutions and brought about a
drastic realignment in the financial sector beyond traditional industry or
national boundaries. This trend is expected to continue for the foreseeable
future. It was against this backdrop that Mitsubishi Tokyo Financial Group
("MTFG") was established as a diversified financial services group to
organically combine the different strengths of its member companies and achieve
further growth. Financial institutions serve important public functions that
come with high social responsibilities. MTFG is no exception, and has the
obligation to actively fulfill its role. To this end, we must recognize once
again that the trust and confidence our clients invest in us are irreplaceable
assets, and that they form the foundation of our very existence. We then must
strive to conduct our business activities based on a higher sense of mission
and ethical standards.
It is with these ideas in mind that we have created the MTFG Code of Ethics
(the "Code"). The Code will serve as a set of guiding principles shaping the
basic corporate and ethical values of MTFG, and we must endeavor to reflect
these in our daily activities. It goes without saying that top management must
set a leading example in honoring the Code, and all management and employees of
MTFG and its entities must follow suit. We understand that ambition and
enthusiasm for business objectives can create the potential to take the focus
away from ethics and compliance. However, one cannot take pride in a company
that does not have high ethical standards; indeed, there is no future for such
a company. It is fundamentally impermissible for a company to neglect laws or
regulations, or to pursue profits in an unethical fashion. And it is becoming
increasingly clear that without an appropriate compliance framework a company
is in no position to even enter the competitive marketplace.
We have decided to make the Code of Ethics public in order to demonstrate to
the world at large our strong commitment to ethics and compliance. We wish to
clearly state our ethical principles, and to undertake that we will observe
them to the fullest extent.
As a core element of our daily activities, the Code must be mastered as a
matter of basic discipline. In regard to the practical application of the Code,
it is also useful to refer to the compliance manual and other related materials
that provide specific explanations of relevant laws, regulations, and internal
rules, and to consult with your line managers and compliance officers. With
these points in mind, we expect all management and employees of MTFG and its
entities to read the Code carefully, and make the most of it as a valuable
guide for your future actions.
Akio Utsumi Shigemitsu Miki
Chairman President
Mitsubishi Tokyo Financial Group, Inc.
May 2002
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Contents
I. Underlying Principles...................... 3
II. The MTFG Code of Ethics................... 3
III. Self-appraisal Guide for Specific Actions 6
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I. Underlying Principles
1. Establishment of Trust
Fully cognizant of the importance of the Group's social responsibilities and
public role, we strive to maintain unwavering trust from society through the
sound and proper management of our business activities, based on the principle
of accountability.
2. Serving Our Clients First
We recognize that the satisfaction of our clients and their confidence in
MTFG form the foundation of the Group's very existence. As such, we endeavor to
always provide our clients with the highest quality products and services best
suited to their needs.
3. Sound and Transparent Management
We endeavor to manage our affairs in a sound and transparent manner by
maintaining appropriate and balanced relationships with all stakeholders,
including clients, shareholders and others, while assuring fair, adequate and
timely disclosure of corporate information.
4. Strict Observance of Laws, Regulations, and Internal Rules
We are committed to strictly observing relevant laws, regulations, and
internal rules and to acting with fairness and integrity in conformity with the
common values of society at large. As a diversified global financial services
group, we also make continuous efforts to operate in ways that reflect
internationally accepted standards.
5. Respect for Human Rights and the Environment
We respect human rights and the environment and seek to co-exist in harmony
with society.
6. Disavowal of Anti-Social Elements
We stand firmly against supporting the activities of any group or individual
that unlawfully threatens public order and safety.
II. The MTFG Code of Ethics
1. Establishment of Trust
Fully cognizant of the importance of the Group's social responsibilities and
public role, we strive to maintain unwavering trust from society through the
sound and proper management of our business activities, based on the principle
of accountability.
As one of the world's largest diversified financial services groups, MTFG
serves an important public role and has corresponding social responsibilities.
Aspects of commercial banking, for example, such as the intermediation of funds
through deposits and loans, as well as the settlement of accounts through fund
transfers, are an indispensable part of the national economic infrastructure.
In the securities business, too, we serve as an important conduit between
clients and the securities market, where funds are raised and invested.
Accordingly, we must act fairly and with integrity to protect the interests of
our customers, while helping to maintain the soundness of the marketplace. In
conducting trust banking business, meanwhile, we contribute to the healthy
development of our economy and of society through the custody, investment, and
disposition of assets held in trust. In these activities, therefore, we are
obligated to comply fully with relevant laws, regulations, and internal rules,
while acting with all reasonable care and skill, with the duty of loyalty, and
with the utmost professionalism.
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The principle of accountability dictates that we act on our own judgment and
take responsibility for the consequences of our actions. Winning trust from
society becomes possible only when each MTFG company fulfills its social
responsibilities and public role, and conducts its affairs in a sound and
appropriate fashion, based on the principle of accountability. It must be
remembered that trust built up over many years can be lost in a moment through
inappropriate behavior. With this firmly in mind, each and every one of us will
strive to perform our activities with the highest sense of ethics.
2. Serving Our Clients First
We recognize that the satisfaction of our clients and their confidence in
MTFG form the foundation of the Group's very existence. As such, we endeavor to
always provide our clients with the highest quality products and services best
suited to their needs.
To survive and prosper as a going concern, an enterprise must be highly
valued by its clients. This is becoming more and more relevant in today's
rapidly changing society. As such, we endeavor to satisfy and win the
confidence of our clients by providing them, in a timely fashion, with high
quality products and services that meet their needs. To this end, each one of
us must continue to strive with professional pride in our assigned area of
responsibility. We should not be complacent and accept the status quo. We need
to tackle challenges with creativity, and put the task of satisfying the
diverse needs of our clients first.
As a comprehensive financial services group, MTFG comprises companies from
different industry sectors with different functions. By harnessing the
strengths of the Group as a whole, each MTFG company is working to provide
competitive new products and services.
We are also dedicated to communicating responsibly and effectively with our
clients. Through proactive disclosure of information and thorough explanation
of our products, services, and attendant risks and other relevant factors, we
will do our best to facilitate the understanding and appropriate
decision-making of our clients. In executing transactions, we will hold to our
promises, and carry out our business activities fairly and with integrity.
Furthermore, we will prudently manage our clients' assets and earnestly
fulfill the duty of confidentiality. Unless properly justified, we do not
disclose to outside parties any information about our clients obtained through
our transactions with them or through related activities. Through proper
conduct in such matters, we will maintain relationships with clients that are
founded on trust.
3. Sound and Transparent Management
We endeavor to manage our affairs in a sound and transparent manner by
maintaining appropriate and balanced relationships with all stakeholders,
including clients, shareholders and others, while assuring fair, adequate and
timely disclosure of corporate information.
Through our business activities, we invariably interact with various
stakeholders, including clients, shareholders, creditors, management,
employees, vendors, competitors, local communities, political bodies, and
government offices. To be truly accepted into society, we must act as a good
corporate citizen and formulate appropriate and balanced relationships with all
stakeholders, while ensuring that we behave in a manner that does not warrant
any suspicion of misconduct.
Disclosing corporate information fairly, while remaining sensitive to the
choices and decisions of the marketplace and our clients, increases the
transparency of corporate activities and helps facilitate understanding and
trust from society. Therefore, we are committed to the timely and comprehensive
disclosure of corporate information that would be reasonably required for our
shareholders, investors, and clients to make decisions. At the same time, we
are open to a wide range of outside opinions. We consider these opinions with
care as part of our continuous efforts to improve our operations and services.
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In order to assure the soundness of our businesses, we endeavor to generate
profits, manage risks prudently, and safeguard and expand the Group's assets.
We also pay particular attention to whether appropriate internal control
systems are in place in areas such as the effectiveness and efficiency of
operations, the issuance of accurate financial statements, and the Group's
compliance with relevant laws, regulations, and internal rules.
4. Strict Observance of Laws, Regulations, and Internal Rules
We are committed to strictly observing relevant laws, regulations, and
internal rules to acting with fairness and integrity in conformity with the
common values of society at large. As a diversified global financial services
group, we also make continuous efforts to operate in ways that reflect
internationally accepted standards.
MTFG conducts business globally through its first class domestic and
international network. Accordingly, there are numerous laws, regulations, and
internal rules that MTFG must abide by. Regardless of national boundaries, we
are committed to thoroughly understanding and complying with the letter and
spirit of relevant laws, regulations, and internal rules. We will carry out our
business activities fairly and with integrity, and act in conformity with
recognized social values. We do not seek any transactions or profits to be
obtained through the breach of laws, regulations, or ethical standards.
In order to maintain high ethical standards and create a corporate culture
that encourages compliance with laws, regulations, and internal rules, we will
continually work to improve our institutional framework and distribution of
necessary information. In cases of violations of laws, regulations, or internal
rules, we will act promptly to resolve the problems and seek out the causes,
and will establish measures to prevent recurrences of such problems. We will
also deal with violators in a strict and fair manner, and actively cooperate
with appropriate authorities.
As economic activities become increasingly borderless and companies look to
compete internationally on a level playing field, there is a growing trend to
unify standards in various areas of corporate management, such as corporate
governance, corporate accounting standards, and internal controls. We will
maintain our awareness of such global trends, and continuously review aspects
of our business such as management systems, public disclosure rules, internal
control systems, business practices, and human resources management from a
global perspective, in order to manage our affairs in a fashion worthy of a
full participant in international society.
5. Respect for Human Rights and the Environment
We respect human rights and the environment and seek to co-exist in harmony
with society.
As a global, diversified financial services group, MTFG conducts business in
countries around the world. As such, our clients as well as our employees come
from diverse backgrounds. In every aspect of doing business, we respect each
individual's human rights. We also respect the environment.
We are dedicated to protecting people's privacy. We reject discriminatory
language, actions, and harassment, both within and outside of the organization.
Discrimination on the basis of gender, age, nationality, race, ethnic origin,
religion, social status, or physical disability has no place in our business
activities, hiring, or personnel management. We respect different cultures and
customs in conducting our affairs, and value harmony with society.
Furthermore, we seek to balance our business activities with the protection
of the global environment, which is the common asset of mankind. We will
continue to give careful consideration to environmental issues, not just in
terms of the consumption of resources within the Group, but also in our
relationships with clients and society.
6. Disavowal of Anti-Social Elements
We stand firmly against supporting the activities of any group or individual
that unlawfully threatens public order and safety.
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We will not tolerate any unjust intervention from elements that seek to
disrupt public order and safety. Condoning this kind of intervention could
undermine confidence in MTFG, and we will steadfastly refuse to yield to any
such attempts. Through properly conducting our affairs we will minimize any
opportunity for disturbance. Should a situation arise, we will in all cases
take necessary action, including cooperation with the police and other
concerned parties as appropriate.
In particular, we are committed to enhancing adequate systems to combat
money laundering and to prevent the use of financial institutions for criminal
activities, including terrorism and tax evasion.
III. Self-Appraisal Guide for Specific Actions
The MTFG Code of Ethics comprises guiding principles that each MTFG company
and all management and employees must abide by in order to realize our
management philosophy. The accurate understanding of its contents and
underlying spirit is a prerequisite before taking action. Nonetheless, we may
occasionally encounter problems that are not directly covered in the Code, or
to encounter situations in which we are not sure how to act. In such
circumstances, consult with your line manager or compliance officer without
hesitation.
When considering how to act in your day-to-day activities, it may also be
useful to consider the following questions. If you have a sense of discomfort
in formulating your answers to any of these questions, there is a strong
possibility that you may be facing a potential problem under the principles of
the Code.
1. Would my action be fair, and something that I could talk about proudly
with my family and friends?
2. Would my action conform to all relevant laws, regulations, and internal
rules?
3. Would my action seem appropriate to others?
4. Am I trying to ignore my conscience by pretending that my action would
be for the good of the company?
5. Would my action harm MTFG's reputation in any way?
When in doubt, remember that you are not alone. Please have the courage to
consult with your line manager or compliance section.
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Excerpts from MTFG's Compliance Rules
(English Translation)
(Objective)
Article 1.
These rules prescribe basic matters relating to compliance with laws and
regulations.
(Definition)
Article 2.
(1) In these rules, "laws and regulations" mean laws and government ordinances
(including those by local authorities) to be strictly observed by MTFG
personnel when carrying out business operations, and MTFG's Articles of
Incorporation, Code of Ethics, and other rules and regulations established
according to the laws and government ordinances above.
(2) "Compliance" means understanding the purpose and contents of laws and
regulations properly, and behaving in an appropriate manner so as not to
violate the laws and regulations.
(Revision and abolishment)
Article 3.
These rules may be revised or abolished by resolution of MTFG's Board of
Directors.
(Responsibilities of Directors, Executive officers (Shikko Yakuin) and Board of
Directors)
Article 4.
(1) In accordance with the "Code of Ethics", MTFG directors and executive
officers (shikko yakuin) must carry out their responsibilities with the
recognition that compliance is one of the most important objectives of
their management.
(2) The board of directors must establish systems including the measures listed
below and seek to achieve and maintain compliance.
(1) The board of directors must formulate concrete action plans relating to
compliance matters, such as training and internal control implementation
plans, at least once a year, and must periodically check the status of
their implementation.
(2) The board of directors shall create a guiding manual regarding
compliance related matters (the "Compliance Manual") and must confirm
all important revisions of the Compliance Manual.
(Responsibility of MTFG Employees)
Article 5.
(1) MTFG employees must perform their duties by securing compliance, and in
accordance with the "Code of Ethics".
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(2) MTFG employees must strive to acquire adequate knowledge of the laws and
regulations which are necessary to their business operations.
(3) When an MTFG employee discovers violations of laws and regulations
(including cases of willful wrongdoing), or possible violations, they must
report directly to the Compliance Officer as stipulated in Article 6.
(Compliance Officers)
Article 6.
(1) The Chief Manager of each division is designated as a Compliance Officer.
(2) The Compliance Officer is responsible for the strengthening of compliance
in each division and for planning and supervising compliance related issues
regarding business matters under his jurisdiction.
(Compliance Reporting System)
Article 7.
When the Compliance Officers receive reports of or otherwise detect
violations of laws and regulations, or possible violations, they must report
directly to the Compliance Group and the General Manager of their division.
(Responsibilities of General Managers)
Article 8.
(1) If a General Manager discovers, or receives a report from the Compliance
Officer regarding, actual or potential violations of laws and regulations,
such General Manager must discuss and consult with the General Manager of
the Audit Division regarding such actual or potential violations, and issue
necessary directions and instructions to the Compliance Officer as
appropriate.
(2) Each General Manager may appoint a Deputy Compliance Officer to assist the
Compliance Officer when such General Manager deems it necessary. Each
General Manager shall report any such appointments to the General Manager
of the Audit Division.
(Audit Division Monitoring Group)
Article 9.
If the Audit Division Monitoring Group discovers actual or potential
violations of laws and regulations with respect to an audit, it must report the
matter to the Compliance Group without delay.
(Office in Charge of Compliance)
Article 10.
(1) The Compliance Group in the Audit Division is in charge of overseeing the
overall compliance framework.
(3) When the Compliance Group receives report of or otherwise detects
violations of laws and regulations, or possible violations, it must take
necessary actions.
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(Director in Charge of the Audit Division)
Article 11.
(1) The Director in charge of the Audit Division must report matters concerning
compliance to the Board of Directors or Executive Committee as necessary.
(2) When there is a risk of an unavoidable conflict of interest on a compliance
matter of a different division which the Director in charge of the Audit
Division is also in charge of, to insure the independence of the Audit
Division, the General Manager of the Audit Division shall report to the
President. The President will report such matter to the Board of Directors
or Executive Committee as necessary. Appropriate action shall also be taken
to avoid conflicts of interest in cases other than those mentioned above.
(Disciplinary Action)
Article 16.
If an employee violates laws and regulations including this Compliance rule,
disciplinary action may be taken according to the rules governing his/her
employment.
Excerpts from MTFG's Compliance Manual
(English Translation)
1. Legal Management
(3) Board of Directors
(4) Transactions involving a conflict of interest
When a Director engages in a transaction with a conflict of interest, the
Director must gain the approval of the Board of Directors.
9. Conflicts of Interest
When a Director engages in a transaction with a conflict of interest, the
Director must gain the approval of the Board of Directors.
An employee may not receive, as an employee of a bank holding company (or an
employee of a subsidiary bank) cash or other benefits from a customer or
similar persons of the bank. An employee may not take part in a transaction
which may cause a conflict of interest with his/her family member or friend.
MTFG is prohibited from receiving continuous service from a subsidiary at a
price that is substantially lower than cost. MTFG is also prohibited from
having an affiliated company pay for fees that should be paid by MTFG.
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