Executive Director, Metrical Inc

Aki Matsumoto

Executive Director

Independent Leading Corporate Governance Research

Metrical Inc

METRICAL INC. is an independent leading Corporate Governance research firm in Japan where Corporate Governance is increasingly recognized as an important element on corporate management in these days. Thus, CG research and solutions would become an essential component of global capital markets and play important to contribute to transparency of the markets and maximize shareholders’ value in Japan. 

METRICAL INC. provides Corporate Governance research and analysis including rating services, and  also offers investment research and IR services with solutions and customized profound research on CG and IR issues.

<ul>
<li>This article is a follow-up to the previous one and will further explore how the ratio of foreign shareholders affects companies that have anti-takeover measures.</li>
<li>There is a correlation between the increase in the percentage of foreign shareholders and the decrease in the percentage in favor of the proposal to continue takeover defense measures.</li>
<li>Overseas investors invest in companies with high profitability even when investing in companies with anti-takeover, and portfolio companies tend to try to improve other practices while retaining takeover defense measures.</li>
</ul>


This article is a follow-up to the previous one and will further explore how the ratio of foreign shareholders affects companies that have anti-takeover measures.
There is a correlation between the increase in the percentage of foreign shareholders and the decrease in the percentage in favor of the proposal to continue takeover defense measures.
Overseas investors invest in companies with high profitability even when investing in companies with anti-takeover, and portfolio companies tend to try to improve other practices while retaining takeover defense measures.


Japan's Governance: Takeover Defense Measures and Foreign Shareholder Ratio

<ul>
<li>This article explored what kind of companies overseas investors are investing in in terms of Key Performance Indicators and Corporate Governance Practices by focusing on the percentage of foreign shareholders.</li>
<li>The group of companies with the higher percentage of foreign shareholders tend to have higher ROE, ROA and Tobin's q, as well as better values in many corporate governance criteria.</li>
<li>The difference in Key Performance Indicators and corporate governance practices between the group with &gt;30% and =&lt; 30% in foreign shareholding suggests that there is a watershed around 30% shareholding.</li>
</ul>


This article explored what kind of companies overseas investors are investing in in terms of Key Performance Indicators and Corporate Governance Practices by focusing on the percentage of foreign shareholders.
The group of companies with the higher percentage of foreign shareholders tend to have higher ROE, ROA and Tobin's q, as well as better values in many corporate governance criteria.
The difference in Key Performance Indicators and corporate governance practices between the group with &gt;30% and =&lt; 30% in foreign shareholding suggests that there is a watershed around 30% shareholding.


Japan's Governance: Considerations Regarding the Percentage of Foreign Shareholders

Founder & Chief Market Strategist - SAV Markets, SAV Markets

Shyam Devani

Founder & Chief Market Strategist - SAV Markets

Provide Comprehensive Analysis & Commentary

SAV Markets

SAV Markets aims to provide comprehensive analysis & commentary on foreign exchange and asset markets. The approach is multi asset as markets are typically interlinked. Cause and effect are always at work, even if those effects take time to manifest. As nothing is permanent we strive to get ahead of the curve in an ever changing world.

Cross Asset Strategy

<ul>
<li>This is an opinion piece that attempts to look at the sustainability of policies set out by the Bank of Japan, namely the yield curve control.</li>
<li>There seems to be a growing risk that long end yields are set to rise further, testing the BoJ's resolve.</li>
<li>Indications are already there in the interest rate curves and the performance of Japanese Banks. A further report will follow, highlighting relevant charts and trade ideas</li>
</ul>


This is an opinion piece that attempts to look at the sustainability of policies set out by the Bank of Japan, namely the yield curve control.
There seems to be a growing risk that long end yields are set to rise further, testing the BoJ's resolve.
Indications are already there in the interest rate curves and the performance of Japanese Banks. A further report will follow, highlighting relevant charts and trade ideas


<ul>
<li>The frequency of share repurchases is highly correlated not only with ROE and ROA, but also with changes in market capitalization, regardless of whether the stock is undervalued or not.</li>
<li>Since the frequency of share retirements was found to be correlated with key board practices, I examined hypothesis that an improvement in board practices would have positive impact on actions.</li>
<li>As a result of focusing on ％ independent directors, key to ensuring the transparency of board, it was confirmed that ％ independent directors has significant positive correlation with many actions.</li>
</ul>


The frequency of share repurchases is highly correlated not only with ROE and ROA, but also with changes in market capitalization, regardless of whether the stock is undervalued or not.
Since the frequency of share retirements was found to be correlated with key board practices, I examined hypothesis that an improvement in board practices would have positive impact on actions.
As a result of focusing on ％ independent directors, key to ensuring the transparency of board, it was confirmed that ％ independent directors has significant positive correlation with many actions.


Japan's Governance: Considerations Regarding Retirement of Treasury Stock

<ul>
<li>It is said that an increasing number of companies are cancelling their own shares to meet prime market listing criteria that requires % of tradable shares be at least 35%.</li>
<li>However, in reality, more than half of companies have never cancelled treasury stock. Companies that have retired three or more times perform significantly better in Key performance and Corporate Governance.</li>
<li>It is worthwhile to continue to focus on the retirement of treasury stock as a litmus test for assessing the progress of corporate governance initiatives and performance improvement.</li>
</ul>


It is said that an increasing number of companies are cancelling their own shares to meet prime market listing criteria that requires % of tradable shares be at least 35%.
However, in reality, more than half of companies have never cancelled treasury stock. Companies that have retired three or more times perform significantly better in Key performance and Corporate Governance.
It is worthwhile to continue to focus on the retirement of treasury stock as a litmus test for assessing the progress of corporate governance initiatives and performance improvement.


Japan's Governance: Prime Market Standard and Treasury Stock Retirement

Japan

The TOPIX, also known as the Tokyo Stock Price Index, is a capitalization-weighted index of all companies listed on the First Section of the Tokyo Stock Exchange. The index is supplemented by the subindices of the 33 industry sectors. The index calculation excludes temporary issues and preferred stocks, and has a base value of 100 as of January 4, 1968.

TSE Tokyo Price Index TOPIX (TPX INDEX)

Japan's Governance: Takeover Defense Measures and Foreign Shareholder Ratio

This article examines anti-takeover with a focus on % foreign shareholders. There is correlation between % foreign shareholders and % of support...

Metrical Inc

Japan's Governance: Considerations Regarding the Percentage of Foreign Shareholders

Analysis of Performance and Governance on ％ foreign shareholding, shows that there are differences between groups with >30% and =< 30%, indicating...

Metrical Inc

Playing with Fire – FX & Rates, Japan

Is the Bank of Japan immune in a world that sees rising consumer prices? Should they continue to pursue a policy that only seems to weaken their...

Shyam Devani

Japan's Governance: Considerations Regarding Retirement of Treasury Stock

The frequency of retirement of treasury stock is correlated not only with ROE and ROA but also with changes in market cap. This is also correlated...

Metrical Inc

Japan's Governance: Prime Market Standard and Treasury Stock Retirement

It is true that the number of companies retiring their own shares increases along with TSE's market reorganization, but the reality is that the...

Metrical Inc