(本文翻譯自 陳冲 除政治外 安倍還懂公司治理 2022-09-06)
After assassination of Shinzo Abe, Taiwan was arguing over whether to fly flag at half-staff and Japan itself was also debating over whether to hold a state funeral. We Appacus Foundation as usual focuses only on finance and economics and avoids discussing political issues. This article is no exception.
Abe became prime minister for the second time at the end of 2012. To wash away negative reviews that being criticized as incompetent leader, he worked hard after taking office this time. On Feb. 22nd 2013 at CSIS, he directly said at the beginning of the speech that Japan is back, strongly showing his ambition. At the Davos WEF the next year, he gave the speech “Japan’s New Dawn”, drawing Japan’s economic blueprint, from the preparation of the Olympic Games, power and energy, medical industry, to regional economic integration and tax reform. Since then, the term Abenomics spread like wildfire across the world. I had resigned from the government then, so I focused more on an under-reported thing, the corporate governance. Two months later on May. 2014, I had published an article in the newspaper column titled “Abe's Fourth Arrow”, pointing out that Abe’s ambition to promote corporate governance in Congress was a difficult task because there was strong opposition from industries. Even major donors of Liberal Democrats, commonly called "Keidanren", are privately campaigning against it.
At the end of 2015, the Japanese academic circles wrapped up three achievements of Abe’s corporate governance promotion over the past year. The tactics are both soft and tough and the methods include both force and inflexibility. There are amended laws and also administrative guidance. First, after the Davos meeting, Japan decided to introduce Japanese version of the Stewardship Code at the cabinet meeting. On Feb. 26th 2014, the Financial Services Agency published the Principles for Responsible Institutional Investors, requiring institutional investors to actively participate in the decision-making of shareholders’ meeting, disclose the voting process, and seriously participate in corporate governance in a spontaneous and self-disciplined manner. The fast speed really knocked people’s socks off. In fact, institutional investors also replied with an enthusiastic response. Second, on Mar. 5th 2015, Tokyo Stock Exchange issued the Corporate Governance Code, mainly referring to the OECD model. Interesting is that the regulation requires crossholding shareholders to explain the purpose and reasons for holding shares, which really posed pressure on companies using crossholding as the strategy to consolidate their ownership rights. Third, on May. 1st 2015, the Companies Act was amended. With the Tokyo Stock Exchange adding two outside directors (i.e. independent directors), the Companies Act stipulates the criteria for outside directors, which is quite shocking to many large corporations (especially the requirement that outside directors must not serve within the company for the past ten years).
From the promotion of corporate governance, we can see that Abe dealt with the problem with consummate and smart skill and that he was still willing to devote resources and energy to the issue., indicating that he is still a politician with ideal. After Abe's assassination, there were mixed reviews. I met several foreign affairs veterans and heard some deeds and I felt that Abe is a person thinking thoroughly. He had visited Taiwan two times in 2011 and 2012. Although only a member of the House of Representatives then (but after all former prime minister before), it’s said that he originally planned to visit former President Li when he got off the plane. The foreign affairs staff thought it inappropriate, so Abe said that he would first worship at the Martyrs' Shrine instead, and then conduct other visits. One day, the daytime trip ended and some party members invited him for dialogue at night in the evening. Abe told the reception staff that he needed to rest first and then took a taxi to the appointment by himself. Some people blamed the diplomats afterwards for being rude. In fact, in this situation, the host of post dinner activity should have sent car to pick him up. From these trivial things, we know that Abe is a man with delicate mind. No wonder he can promote corporate governance that was difficult for his predecessors.
Corporate governance is not a big deal for politicians, but a big one for individual companies and even for the capital market as a whole, especially in the ESG era. If domestic politicians can make pygmy effort improving corporate governance (for example, state-owned enterprises governance which is actually piece of cake for them), it would undoubtedly boundless beneficence for all!
(Released on Appacus Foundation website, Sep. 6th 2022)