Good corporate governance should be a part of continuing professional education for senior managers and board members everywhere. Corporate governance is a fascinating topic, but is often misunderstood by the public; sometimes it gets confused with discussions of corporate control or hostile takeovers.
I’m a proponent of stronger corporate governance everywhere – not just in Japan, but also the US. Clearly, both countries have had lapses in good governance, and solutions will vary, because laws and constituencies vary from country to country. Everywhere, the winners from better governance are not just equity shareholders, but pensioners, creditors, employees, the community at large, and the public.
As a consultant at KPH Capital, I’ve been able to draft, design, and implement systems to achieve better governance. Implementation at the corporate level is details-driven and challenging — but, in the end, is worth every drop of sweat. The long-term societal costs associated with backsliding — pension fund deficits, reduced standard of living, and poor health of employment – are too serious to ignore.
Autobiographical note —
My professional roots are in the Japanese stock market, beginning with the heady 1980s “bubble economy”. I was a student of Japanese at a tiny “cram school” in Shibuya, Tokyo, and began my career as an English language investment research editor. Then for a spell I was a sales-trader, before heading off to graduate school. In New York, in the mid-1990s, I worked on project finance and DFI in the emerging markets of Latin America, which have since become very buoyant investment-wise. After that, I spent nearly a decade as a buy-side equity research analyst for two hedge fund start-ups. The first was acquired via takeover, and the second unraveled during the early days of what journalists sometimes call the US Great Recession of 2008. Amid the meltdown, I branched out to become a senior general manager similar to a COO – but without the officer title. This position involved, among other duties, designing and implementing an improved corporate governance system for a culturally “Japanese” company legally domiciled in the State of California, subject to US oversight, annual audit and tax filings.
The Board Director Training Institute (BDTI) is a "public interest" nonprofit in Japan dedicated to training about directorship, corporate governance, and related management techniques. It is certified by the Japanese government to conduct these activities as a regulated nonprofit. Read a summary about BDTI here, and see a menu of its services for both corporations and investors here.