Category

ESG

Oct 26
0

Daily Brief ESG: Little Discussion of Listing Criteria Appropriate for Prime Market Listed Companies and more

By | Daily Briefs, ESG

In today’s briefing:

  • Little Discussion of Listing Criteria Appropriate for Prime Market Listed Companies

Little Discussion of Listing Criteria Appropriate for Prime Market Listed Companies

By Aki Matsumoto

  • It is anticipated that the plenary session will now begin the process of determining a deadline for transitional measures based on public comments.
  • It is likely that a decision will be made on the direction to proceed with English disclosure with respect to the prime market and other market segments.
  • In the meantime, a full-scale discussion on the listing criteria appropriate for prime market listed companies is awaited.

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Oct 23
0

Daily Brief ESG: Prime Market Should Raise Market Cap Standards. Companies Should Take Measures to Raise Valuations and more

By | Daily Briefs, ESG

In today’s briefing:

  • Prime Market Should Raise Market Cap Standards. Companies Should Take Measures to Raise Valuations

Prime Market Should Raise Market Cap Standards. Companies Should Take Measures to Raise Valuations

By Aki Matsumoto

  • There is a discrepancy between the prime market concept and the listing criteria of 10 billion yen in tradable market capitalization.
  • The most significant effect of the market restructuring was the elimination of parent-subsidiary listings, but companies are reluctant to discuss matters not explicitly addressed in the corporate governance code.
  • Increasing market capitalization is not an overnight solution, but companies should study the initiatives advanced by companies that have increased valuations and implement those initiatives.

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Oct 19
0

Daily Brief ESG: The Timing of the Mandatory Disclosure of Human Capital Information Should Not Be a Sticking Point and more

By | Daily Briefs, ESG

In today’s briefing:

  • The Timing of the Mandatory Disclosure of Human Capital Information Should Not Be a Sticking Point

The Timing of the Mandatory Disclosure of Human Capital Information Should Not Be a Sticking Point

By Aki Matsumoto

  • It is useful for statutory documents disclosing a company’s medium-to-long-term management strategy to include information on “human capital,” which plays a role in sustainable growth.
  • If the mandatory timing of the information to be disclosed in annual securities report is accelerated, there is risk that the information will be similar to that of other companies.
  • The government should not stick to 2023 for the mandatory inclusion in annual securities reports, but should give companies time to encourage them to deepen what they include.

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Oct 17
0

Daily Brief ESG: In-Depth Approach Is Necessary for Companies Seeking Further Communication with Overseas Investors and more

By | Daily Briefs, ESG

In today’s briefing:

  • In-Depth Approach Is Necessary for Companies Seeking Further Communication with Overseas Investors

In-Depth Approach Is Necessary for Companies Seeking Further Communication with Overseas Investors

By Aki Matsumoto

  • TSE published “English Disclosure Practice Guide” for companies with the aim of promoting disclosure in English for communicating with foreign investors, who have significant presence in TSE and Japanese companies.
  • The purpose of English-language disclosure is to attract investment from overseas investors and improve valuations, but there is mismatch between information needs of overseas investors and English-language disclosure of companies.
  • While this handbook is helpful for companies attempting to disclose in English for the first time, in-depth approach may be necessary for companies that need further communications with overseas investors.

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Oct 12
0

Daily Brief ESG: The Resolution of Human Rights Issues Should Not Be a Means to a Purpose and more

By | Daily Briefs, ESG

In today’s briefing:

  • The Resolution of Human Rights Issues Should Not Be a Means to a Purpose

The Resolution of Human Rights Issues Should Not Be a Means to a Purpose

By Aki Matsumoto

  • If discussion doesn’t proceed from the starting point that respect for rights should be for the coexistence of humankind, not for the maintenance of corporate activities, it will get confused.
  • Although human rights were included in the 2021 revision of the Corporate Governance Code in the Principles of Sustainability, it is not thought to have been effective.
  • The repeated human rights violation scandals at companies and the fact that these companies have human rights policies in place infers that this is a deeply rooted problem in society.

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Oct 11
0

Daily Brief ESG: Recognizing Human Resource Strategy as a Management Issue and Creating the Policy Is the First Step and more

By | Daily Briefs, ESG

In today’s briefing:

  • Recognizing Human Resource Strategy as a Management Issue and Creating the Policy Is the First Step

Recognizing Human Resource Strategy as a Management Issue and Creating the Policy Is the First Step

By Aki Matsumoto

  • Neither the company nor the employees have made sufficient investments, despite the fact that both sides see a gap between the skills they need and the reality.
  • Many companies either fail to link their management strategy to their human capital investment and human resource strategy, or don’t have a clear policy for human capital investment.
  • If investment in human resources is curbed in order to maintain short-term profit margins, this will lead to weighing on growth potential and profit margins in the medium-to-long term.

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Oct 10
0

Daily Brief ESG: SEBI Indicts and more

By | Daily Briefs, ESG

In today’s briefing:

  • SEBI Indicts, Kotak Mahindra Promotes

SEBI Indicts, Kotak Mahindra Promotes

By Hemindra Hazari

  • SEBI, capital market regulator penalises senior executives of Kotak Mahindra Asset Management Company for serious offenses in June 2022
  • The Securities Appellate Tribunal (SAT) stays the penalties but a stay is not an exoneration, final order scheduled on November 10, 2022 
  • Instead of disciplining senior executives, Kotak Mahindra publicly promotes concerned executives demonstrating contempt for the regulator. 

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Oct 06
0

Daily Brief ESG: Activist Investors Will Grow Their Presence and more

By | Daily Briefs, ESG

In today’s briefing:

  • Activist Investors Will Grow Their Presence, as Japanese Equities Would Be Good Fit for The Approach

Activist Investors Will Grow Their Presence, as Japanese Equities Would Be Good Fit for The Approach

By Aki Matsumoto

  • Given the increased stock market volatility, it’s not surprising that activist investment strategies are a good fit for investors seeking investment strategies that are less correlated with stock market fluctuations.
  • Japanese companies that have lower valuations, less effective steps to maximize their corporate value, and face many challenges in their governance practices are are well suited to activist investor approach.
  • Unlike passive investors who have an impact on the overall stock market, activist investors’ purchases will have a limited impact on the overall market, but their presence will be significant.

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Oct 04
0

Daily Brief ESG: Move to Company with Statutory Committees Is Shortcut to Make the Compensation Committee Functional and more

By | Daily Briefs, ESG

In today’s briefing:

  • Move to Company with Statutory Committees Is Shortcut to Make the Compensation Committee Functional

Move to Company with Statutory Committees Is Shortcut to Make the Compensation Committee Functional

By Aki Matsumoto

  • With the revision of Corporate Governance Code in 2021 and its listing criteria on prime market, the groundwork has been laid to some degree to facilitate functioning of compensation committee.
  • Meanwhile, there are not many companies with voluntary nominating and compensation committees that disclose the authority of their nominating and compensation committees in their annual securities reports.
  • Many companies, even large companies, do not even have a compensation policy in place, indicating that individual director compensation is a much lower priority to consider.

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Oct 02
0

Daily Brief ESG: What Initiatives Are Being Taken by Companies that Have Increased Valuations? and more

By | Daily Briefs, ESG

In today’s briefing:

  • What Initiatives Are Being Taken by Companies that Have Increased Valuations?

What Initiatives Are Being Taken by Companies that Have Increased Valuations?

By Aki Matsumoto

  • Changes in Tobin’s q were closely related to increases in foreign ownership. Companies with increases in Tobin’s q reduced cash equivalents and total assets, suggesting they used assets more effectively.
  • No significant correlation was shown between Tobin’s q and board practices, but companies with large increases in Tobin’s q improved in % independent directors and the independence of compensation committees.
  • Companies with increases in Tobin’s q showed superior values in Key Actions: change in growth policy score, dividend policy score, cash holdings score, frequency of share retirements, AGM/IR disclosure scores.

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