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- “The Digital Governance Code 3.0 - Toward Enhancement of Corporate Value by DX Management -” Formulated
“The Digital Governance Code 3.0 - Toward Enhancement of Corporate Value by DX Management -” Formulated
September 19, 2024
In June 2024, the Ministry of Economy, Trade and Industry (METI) launched the Study Group on Digital Governance toward Enhancement of Corporate Value. Since then, the study group has been holding discussion on the revision of the Digital Governance Code.
Based on the results of the discussion in the study group, METI has formulated “the Digital Governance Code 3.0 - Toward Enhancement of Corporate Value by DX Management –“and hereby releases it.
1. Outline
In November 2020, METI compiled the Digital Governance Code as a collection of basic matters that businesses should refer to when formulating and publishing management visions taking into consideration social changes brought about by digital technologies, as an effort to encourage companies to voluntarily tackle DX efforts.
Following this, in September 2022, METI revised the compilation into the Digital Governance Code 2.0 to address changes in trends, including developing and securing human resources with expertise in digital technology.
In June 2024, METI launched the Study Group on Digital Governance toward Enhancement of Corporate Value. Aiming to encourage business administrators to further engage in digital transformation (DX), the study group focused on the enhancement of corporate value that was brought about by DX and held discussion to revise the Digital Governance Code 2.0 into one placing importance on the smooth conveyance of information to business owners (e.g., changes in the title and structures) and addressing changes in trends, including data utilization and collaboration, developing and securing human resources with expertise in digital technology, and cybersecurity. METI reflected these revised points and compiled a revised version titled “the Digital Governance Code 3.0 - Toward Enhancement of Corporate Value by DX Management (Draft).
METI hereby announces that it has formulated “the Digital Governance Code 3.0 - Toward Enhancement of Corporate Value by DX Management – “based also on public comments that it received during the call from August 8 to September 13, 2024.
2. Key points of the revision
Title
- The title was revised to introduce a new subtitle highlighting the purpose of the Digital Governance Code, i.e., enhancement of corporate value by DX management.
Preface
- The preface was dramatically revised, e.g., to add messages to business administrators for focusing on the enhancement of corporate value by promoting DX.
- It newly presents “Three Viewpoints Necessary for DX Management,” which are consistent with the three viewpoints shown in the Report of the Study Group on Realization of Human Capital Management - Ito Review 2.0: Human Resource Edition, and it shows a well-organized overview of the Digital Governance Code titled “Three Viewpoints and Five Main Concepts Necessary for DX Management.”
Main text
- The main text was dramatically revised in terms of the titles and structures of the main topics by focusing on the smooth conveyance of information to business administrators.
- The details shown in the “Example of efforts” sections in the Digital Governance Code 2.0 were revised and integrated with those shown in the “Desired direction” sections so as to present the details in a more concise and easy-to-understand manner.
- Given that data has been considered an essential element for corporate growth, the main text highlights the importance of data utilization and data collaboration in management.
- Featuring the issue of developing and securing human resources with expertise in digital technology, the most difficult challenge in promoting DX, the main text highlights the significance of such efforts as visualization of employees’ skills by referring to “The Digital Skill Standards”, awareness reform among executive officers and top management, including business administrators, and support for career development.
- The main text also focuses on cybersecurity risks, which are feared to increase in number and become more sophisticated and complex in the future, and highlights the importance of measures, e.g., for third-party audits and supply chain protection.
- In addition, the details shown in some items are revised as necessary, including the role of the board of directors.
3. Impact on the DX Certification program and the DX Stocks program from the revision of the Digital Governance Code
1. Certification criteria for DX Certification
The phrase “changes in society and the competitive environment due to the evolution of digital technologies” in the Digital Governance Code 2.0 was revised to “changes in society and the competitive environment due to data utilization and the evolution of digital technologies,” while the phrase “strategies of utilizing digital technologies” in the conventional code was revised to “DX strategies (i.e., strategies utilizing data and digital technologies).” Accordingly, Item 2. “Certification criteria” (i.e., certification criteria for the DX Certification) in the respective “Main concept” sections now explicitly covers elements involving data utilization.
Moreover, as the structures of the main topics in the Digital Governance Code 2.0 were dramatically revised, the revised version has transferred or divided some items that were described in Item 1. "Main concept" sections and Item 2. "Certification criteria" sections in the conventional code. However, no other details of the certification criteria except those mentioned above have been dramatically changed. If you, as companies, intend to file an application for such certification, you are required to prepare application documents in accordance with the new criteria. For details, please visit the website for the DX Certification Program (in Japanese).
2. Criteria for assessing and selecting companies as DX Stocks
The overall structure of the criteria was dramatically revised. The details of Items (2) “Desired direction” and (3) “Example of efforts” sections shown under the respective major topics in the Digital Governance Code 2.0 were revised and changed as necessary, and then they were integrated into Item (2) "Desired direction.” in the revised code.
The questionnaire items in the DX survey, based on which companies are selected as DX Stocks, are expected to reflect information based on the description of Item (2) “Desired direction.” For more information, please see the details of the DX Survey 2025, which will be published at later date.
Related Materials (in Japanese)
- Digital Governance Code 3.0 - Toward Enhancement of Corporate Value by DX Management(PDF:830KB)
- Reference: Key points of the Revised Digital Governance Code(PDF:963KB)
Related Links (in Japanese)
- Study Group on Digital Governance toward Enhancement of Corporate Value
- Digital Governance Code
- DX Certification Program (certification program under the provisions of Article 31 of the Act on Facilitation of Information Processing)
- Digital Transformation Stocks (DX Stocks)
- e-Gov website for the public comments
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IT Innovation Division, Commerce and Information Policy Bureau