Abstract
In Japan in recent years, fiduciary investment institutions such as the Pension Fund Association and public pensions as well as investment advisors have created guidelines for exercising shareholder voting rights, and have been actively endeavoring in exercising these rights. Participation in corporate governance by American institutional investors is exerting great influence in movements such as these. Foreign stock investment by American institutional investors was centered in Europe in the 1990s. In recent years, with the increase in index investing and an eye toward the effects of risk diversification, there has been an increased amount of investment in Asian and other countries. With investment in foreign stocks increasing, American institutional investors have also come to exert influence on overseas corporate governance. When obstacles arise in taking actions such as these, appeals are made to respective national governments through international organizations such as the OECD, and actions are taken to demand systemic revision. In this way, positions taken toward American institutional investors’ corporate governance come to have strong influence around the world. Actions like these have such huge international impact that French and German researchers have concerns about a “new imperialism.” What does this mean for a stock-held corporation system in which “separation of ownership and management” has been ever increasing? Do institutional investors who have fiduciary responsibility bear a responsibility that differs from that of simply a large shareholder? In this chapter, based on this premise of the issues, I will describe the current circumstances surrounding exercising shareholder voting rights by institutional investors in Japan, and examine the significance of this in the stock-held corporation system.
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