RI Asia conference news: Japan launches corporate-investor forum for new Governance Code

A Japanese corporate management-investor forum is being established to facilitate the relationship between companies and shareholders after the rapid introduction of the Japanese Corporate Governance Code and the fledgling Stewardship Code.
In a keynote speech at the RI Asia conference this week (April 21/22) at the Tokyo Stock Exchange, Professor Kunio Ito of the Hitotsubashi University Department of Commerce and Management and author of the Ito Review, the Japanese equivalent of the UK Kay Review, said companies and investors will meet 3-4 times per year and that the meetings could include Japanese regulators. Ito will serve as Chair of the Forum and said its composition had been 80% decided and will be made up of 20-30 corporate/investment professionals. The first Forum meeting will be held in the middle of June. Japan’s new Corporate Governance Code, which is being ratified, is part of the country’s Revitalisation Strategy, the so-called third arrow of Abenomics, the economic policies advocated by Prime Minister Shinzō Abe. The Code was announced in August 2014, as RI reported Tokyo Stock Exchange (TSE) has drafted the Code for Japanese listed companies with the final, approved version to be published in time for the 2015 AGM season in June. The government says the code will support companies in making “timely entrepreneurial decisions with transparency and integrity and with due regards to the views of shareholders as well as customers, employees, local communities and other stakeholders”. Japanese companies will have to comply with the new TSE listing requirements or explain why not. The government says the aim of the Code is ‘sustainable growth in corporate value’ through improved company management and “strengthened fundamentals supported by financial institutions.” Ito said a government Council of Experts would finalise a report this week outlining the parameters for dialogue between companies and investors. He said there would likely be some confusion to begin with about what such corporate/investor dialogue should represent, but that the Forum would be the path to best practice. He noted that the Forum would have firm government support as part of the national growth strategy.