Thanks to the leadership in the LDP, we were so successful in suggesting a large number of new practices to the FSA that were in fact included in the Japan's Corporate Governance Code, that I got worried that more explanation is needed.
The UK Financial Reporting Council’s report on Developments in Corporate Governance and Stewardship contains many insights useful to Japan as it implements its new Corporate Governance Code and the Stewardship Code. In particular, pages 17-22 on stewardship and engagement, and the quality of stewardship statements, provide food for thought in the sense that progress for the Stewardship Code seems spotty and slow.
Excerpt: "... Meno’s comments echo those of Nicholas Benes, head of the Tokyo-based Board Director Training Institute of Japan (BDTI), who has called for increased director training in corporate governance to ensure a “virtuous cycle” that accelerates reform.
(Note: The numbers below correspond to page numbers in the Powerpoint presentation, which can be downloaded below.)
George Olcott, a guest professor at the Faculty of Commerce at Keio University and an outside director at Hitachi Chemical and Denso Corporation, gave a speech on this topic at the recent Columbia Business School CJEB conference on corporate governance in Japan.
By Franz Waldenberger. Excerpt:
" 5.2 Governance reform as growth strategy
The high number of Japanese companies listed on domestic stock exchanges, the high degree of ownership dispersion and the moderate pay levels of top executives suggest Japan’s system of corporate governance to function well.
Sumitomo Mitsui Trust Group has published its “Initiatives for Strengthening Corporate Governance of the Sumitomo Mitsui Trust Group” , which is more advanced than other banking groups in various respects. It includes a requirement of one-third independent external directors, a monitoring role for those directors and a description of the board’s role, and provisions about director qualifications,, director training, and the formation of committees for nomination and compensation and also audit functions.
Our friend Isaku Murakami, a strong supporter of BDTI, reports, that " the 2015 BIO Tech Exhibitions was a huge success to hand out 400 candy-box including the Flower Designed Cards(insurance summary in the back) and also distribute 200 copies of BDTI's Corporate Governance Brochure during the 3-day convention held at the Tokyo Big Sight, which had 10,436 visitors. "
"In the study, to be released Tuesday, about a third of the people who said they made more than $500,000 annually contend that they “have witnessed or have firsthand knowledge of wrongdoing in the workplace.”
Just as bad: “Nearly one in five respondents feel financial service professionals must sometimes engage in unethical or illegal activity to be successful in the current financial environment.”
One in 10 said they had directly felt pressure “to compromise ethical standards or violate the law.”
"Many of the world’s best-known Asset Managers side too often with company management on controversial votes at company AGMs, even when there is a clear case for challenging company management on a vote, says sector watchdog ShareAction, which has compared the voting records of the largest 33 UK Asset Managers on a host of controversial votes made at a year’s worth of Annual General Meetings.