take place in ad hoc meetings of the Investment Strategy Council, the Investment and Loan  Council, the Environmental Strategy Committee, the Group IT Strategy Committee, the Reorgani- zation Deliberation (Acquisition) Council, the New Business Deliberation Council, the Com- pliance Committee and bi-weekly Management Meetings. The Company is also enhancing  the effectiveness of governance by having important proposals approved at the monthly  meetings of the Board of Directors. The Articles of Incorporation of the holding company stipulate that there shall be 16 or fewer  members on its Board of Directors, that a resolution to appoint a director can only be passed by  a simple majority in a meeting attended by shareholders possessing a third or more of the voting  rights of shareholders who can exercise voting rights, and that the resolution shall not be made  by cumulative voting. In order to ensure flexible management, there are currently eight directors,  each of whom is appointed for one year. Of these, three are outside directors who offer supervi- sion and advice from a third-party perspective and draw on expert knowledge in active discus- sion to ensure speed and transparency of management decisions. The Board of Directors of the holding company supervises the execution of each operating  company’s duties. During the year ended March 31, 2010, the Board of Directors met 15 times,  with average attendance of 100% by directors and 98% by auditors. The Chairman of the JS  Group Corporation also serves as chairman of the board. Attendance of outside directors at board meetings was 100%. These directors actively expressed opinions and comments at meetings and sufficiently car- ried out their roles. Decision-making Body Regarding Dividends of Surplus, etc. The Articles of Incorporation of the JS Group Corporation also stipulate that the items stipulated  in each number of the Corporate Law, Article 459, Paragraph (1), including the item regarding  dividends of surplus, shall be determined not by a resolution of the General Meeting of Share- holders but by a resolution of the Board of Directors, unless stipulated otherwise in bylaws or  regulations. The objective of this provision is to ensure timely returns of profits to shareholders  by giving the authority for dividends of surplus to the Board of Directors. The boards of directors of each operating company consists of members with business respon- sibility. There are relatively few members on each board to ensure prompt decision-making. Indi- vidual directors of the holding company also act as directors at seven consolidated subsidiaries  as of June 30, 2010. Operating Companies Holding Company The internal audit function of the JS Group (Audit Department) comprises three staff members  (as of June 30, 2010). The main operating companies have internal audit divisions and conduct regular internal  audits, including those of the subsidiaries of each operating company. With regard to operating  companies without internal audit divisions, the holding company’s internal audit division con- ducts regular audits to ensure there are no omissions anywhere in the Group. Audit activities are  checked at regular meetings of the officials responsible for internal audits. Group companies also  share information and have a common audit policy. Internal Audits JS Group Corporation Annual Report 2010 36 Implementation of Audits Board of Directors Meeting