The major proxy advisory firm Glass Lewis has announced and published its proxy voting guidelines for the Japanese market. On the topic of independent directors, Glass Lewis writes:
To this end, we believe that a board should have: (i) at least two independent outside directors; or (ii) 20% independence representation, whichever is higher. If a board does not meet this minimal independence threshold, we will recommend shareholders vote against the re-election of the chairman14 of the board. When the position of chairman does not exist, we will hold the most senior member of the board – including the chief executive – accountable for this issue.15
We will, however, always review a board’s independence on a case-by-case basis and, wherejustified, we may make exceptions to our general rule. We are of the view that no single model ofgovernance is ideal for all listed entities, and so we encourage issuers to explain their system of
corporate governance and how it will be effective in protecting and promoting shareholder value.