ESG

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Voyage Care’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Weak”.

• Since the total shares held by Founder Family, trust Banks and FamilyMart exceed 50%, this director appointment proposal will pass unless the shareholders held by the trust banks oppose it.
• Challenges will be noted in the function of the nominating committee, which nominated directors with few elements falling under the skills item, and in the disclosure of the skills matrix.
• While PPIH’s free cash flow is ample and growth is expected, shareholder returns and governance remain challenges, but with overseas investor equity exceeding 30%, much improvement is expected in future.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Constellium’s ESG as “Adequate”, in line with its Environmental and Social scores, while the Governance pillar is “Strong”. Controversies are “Immaterial” and Disclosure is “Strong”.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Guala Closures’ ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Strong”.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Techem’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Derichebourg’s ESG as “Adequate”, in line with the scores for the Environmental, Social and Governance pillars. Controversies are “Immaterial” and Disclosure is “Strong”. 

We note that the company is active in the recycling industry, which is generally a positive driver.

• The reason companies object to a reduction in the investment unit is the cost of shareholder relations, not the cost paid to the trust bank.
• We should discuss whether it is better for the “unit of investment” principle to remain in place for the convenience of companies that want to pass company proposals smoothly.
• It will be interesting to see if there will be a discussion on going back to basics and allowing single share holders to exercise their voting rights.

• Information asymmetries between shareholders/investors and board directors, between inside and outside board directors, between inside and outside statutory auditors, and between insiders and the rest are constant challenges.
• Statutory auditors cannot be dismissed and have significant powers, including the right to investigate, and since statutory auditors are board members, they can attend and speak at board meetings.
• To make statutory auditors function, establish a process for nominating statutory auditors, raise the compensation of outside auditors, and run an open board meeting where board members’ comments are respected.

• Last year’s CAPEX plan was also a record high, but ROE growth was limited. We should closely monitor whether the allocation of CAPEX, shareholder returns, and retained earnings is appropriate.
• When a company finally begins using cash on hand for investments and lacks reliable track records, it should be monitored to ensure that it’s generating sufficient cash flow from CAPEX.
• The trend continues to remain that most investments are directed overseas. Note that many Japanese companies have a history of having difficulty managing their overseas operations.

• Without the driving force to generate cash flow in excess of the discount rate (cost of capital), there is not enough power to push stock valuations higher and higher.
• The fact that 8% ROE is the threshold at which valuations change means that investors consider the cost of capital for Japanese equities to be roughly 8% on average.
• Little progress has been made since 10 years ago, when the Ito Report advocated “shift to corporate value management with an awareness of capital efficiency” and “engagement of institutional investors.”

• Rather than “companies with advanced disclosure have higher ratios of female managers,” companies with high ratios of female managers are willing to disclose their ratios to show their progress.
• Women’s tenure in the company is shorter than men’s, which is one of the reasons for the low ratio of women in management positions.
• Changing from the “traditional division of labor in households” to a mindset in which men and women are equally responsible for household tasks is essential to solving the root problem.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We view SPIE’s ESG as “Strong”, in line with its Social and Governance scores. The company has an “Adequate” score for the Environmental pillar. Controversies are “Immaterial” and Disclosure is “Strong”. 

SPIE was awarded a Gold rating by EcoVadis for the ninth consecutive year in 2023.

• Few Japanese stocks that have advantages in profitability has led to the fact that investors who invest long-term in quality stocks have few Japanese stocks to choose from globally.
• It’s the profit margin on sales that has had the greatest impact on changes in ROE. Companies must now get their core competencies once again to regain competitiveness and profitability.
• Even if business selection and investment in promising businesses were to be implemented, it would be several years before they bear fruit. For many investors, this pace seems unacceptable.

• Rather than lowering the minimum investment amount, attention is focused on whether the essence of the issue is whether the long-standing unit share system can be abolished.
• This system, which doesn’t grant voting rights to shareholders who don’t hold more than certain number shares, has led companies to turn inward-looking by making AGMs skeleton and accelerating cross-shareholdings.
• With corporate racketeer, who triggered the introduction of this system, gone and the reduction of cross-shareholdings beginning, shareholder units that can exercise voting rights for open AGMs should be reexamined.

• Comparing the number of Japanese companies in top 50 global market capitalization and Japan’s GDP as percentage of world’s GDP in 1989, it’s clear that economy and companies didn’t grow.
• Without more Japanese companies that have an edge in profitability, a key focus for long-term global investors, it will not be possible to put long-term investment money into Japanese equities.
• It is assumed that BoJ’s policy of inducing the yen to depreciate through ultra-monetary easing may have in part spoiled company managers and caused them to neglect their corporate efforts.