FT News Briefing Activist investors give Japan a wake-up call
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Jan 2, 2025 The UK struggles to control illegal crypto ads despite attempts at regulation. In Japan, activist investors are shaking up the corporate world, challenging traditional governance practices. The number of U.S. venture capital firms is declining, leaving smaller startups in a tough position. Meanwhile, Europe's economic recovery strategies are put under the spotlight in an interview with Christine Lagarde, highlighting the region's fight against inflation post-Covid-19.
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Rise of Shareholder Activism in Japan
- Shareholder activism in Japan is increasing, targeting even the largest companies.
- This rise signals a shift in Japan's business landscape, as companies face pressure to adapt.
Shift in Corporate Governance
- Early shareholder activism in Japan faced resistance, but the corporate governance code introduced around 2013-2015 changed the landscape.
- This encouraged responsible behavior from companies and institutions, leading to a steady increase in activism.
Impact of Inflation
- Japan's long period of deflation and low interest rates reduced pressure on businesses.
- The current inflationary environment and rising interest rates are now pushing companies to focus on cost of capital and investor metrics.