Japan’s Revised Stewardship Code Now Requires Disclosure of Voting Records, in Principle

The FSA has finalized its revision of the Stewardship Code. Perhaps the biggest change is that it now encourages signatories to disclose their voting records “for each investee company on a per-agenda basis”, something I proposed to the FSA in 2010 on a somewhat firmer basis but was ignored. However as you can see below, this is a “comply or explain rule”, thus weakening it to some extent:

“Institutional investors should disclose voting records for each investee company on an individual agenda item basis. (If there is a reason to believe it inappropriate to disclose such company-specific voting records on an individual agenda item basis due to the specific circumstances of an investor, the investor should proactively explain the reason. Institutional investors should at a minimum aggregate the voting records into each major kind of proposal, and publicly disclose them.)”

See:
http://www.fsa.go.jp/en/refer/councils/stewardship/

Here is a “track changes” version of the new code compared to the previous version:
http://www.fsa.go.jp/en/refer/councils/stewardship/20170529/02.pdf

The FSA also clarifies various legal issues here:
http://www.fsa.go.jp/en/refer/councils/stewardship/20140226.pdf

Nicholas Benes

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