JAPAN - Normally placid Japanese pension funds have opened hostilities with failing companies in which they invest by threatening to vote against the re-election of management - and payment of their retirement allowances - if a firm suffers three straight years of losses with no dividend pay-outs.
The country’s Pension Funds Association, which represents 1,700 employee pension funds worth ¥5,300bn (US$45.2bn), is set to adopt the new corporate governance voting guidelines in April.
Up until now there was a reluctance on the part of Japanese pension funds to engage in shareholder activism.
Kazuhisa Okamoto, managing director of Barclays Global Investors in Japan, said: “Some companies are responsive, but some do not understand properly what good corporate governance can mean for them.
“Generally speaking, global companies are more responsive to these moves.
“Quite possibly one of the fundamental reasons for the poor performance of the Japanese market might be attributable to lack of adequate corporate governance to date.”
The registration deadline for the Workplace Savings & Benefits Awards 2019 is today.
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