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.

Higher P/E Is Driver for This Stock Rally. Profit Growth Is Necessary for Further Stock Rally

Challenge Is to Simultaneously Reduce Cash on Hand and Achieve Profitability over Cost of Capital

Alignment of Management and Shareholder Interests Could Be the Beginning of Happiness

Companies Should Show a Path to Accelerated Profit Growth Rather than Shareholder Returns

Few Companies Include ROE and ROIC as KPIs in Their Mid-Term Management Plans

Even if Proper Nomination Process Is Skipped, It May Be Considered Better than Zero Women Directors

Limited Number of Business Types with Great Opportunities for Women Is at Heart of the Problem

Executive Director, Metrical Inc

Aki Matsumoto

Executive Director

<ul>
<li>It's necessary to clearly present cash allocation policy to investors and communicate with them, but unless this policy is convincing and feasible, investors cannot envision an increase in corporate value.</li>
<li>Companies that use ROE or ROIC as KPIs and disclose their cost of capital are still limited. The low return on cash flow may be the reason behind this.</li>
<li>As TOPIX is correlating more rapidly with nominal GDP than with P/B after 2020, there's increasing need to communicate to investors that free cash flow will grow through cash allocation.</li>
</ul>


It's necessary to clearly present cash allocation policy to investors and communicate with them, but unless this policy is convincing and feasible, investors cannot envision an increase in corporate value.
Companies that use ROE or ROIC as KPIs and disclose their cost of capital are still limited. The low return on cash flow may be the reason behind this.
As TOPIX is correlating more rapidly with nominal GDP than with P/B after 2020, there's increasing need to communicate to investors that free cash flow will grow through cash allocation.


The Essence of the Matter Is the Low Return on Cash Flow Generated by the Company's Business

TSE Tokyo Price Index TOPIX

The Essence of the Matter Is the Low Return on Cash Flow Generated by the Company's Business