JURIST:”The Toshiba Corporate Governance Scandal: How Can Japanese Corporate Governance be Fixed?”- reference to board training

Excerpt: “….. It will be interesting to see what lessons are drawn from Toshiba’s failure. Problems with Toshiba’s seemingly well-considered hybrid approach to governance clearly illustrate the tension and difficult tradeoffs between insider and outsider perspectives. Director independence is important for monitoring management, however failures by American companies during the 2008 financial crisis have also exposed the limits of independence and resulted in a renewed call for director competence. Toshiba made an effort to utilize the knowledge and experience of former insiders, in combination with independent directors, to ensure effective monitoring of management.

However, in this case, what it assumed was a strength proved to be a two-edged sword, as the audit committee apparently failed to function with sufficient independence.

Japan’s corporate governance may be aided by a new corporate governance code for listed companies (which became effective June 1, 2015). Under this code Japanese companies must now report (comply or explain) with respect to a long list of governance issues. Although a clear principle recommending a minimum of two independent directors has claimed much of the attention, other new areas such as director training and board self-evaluation may have a greater impact on board functioning. “

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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.

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