Category: Law

The Legal System Advisory Council has been discussing amendment of the Company Law for almost a year now but there have been precious few significant, concrete proposals put forth by the private sector. So, I have recently made one.

There's lots of focus on increased disclosure about executive compensation in the U.S. , UK and Japan, but we thoughtthese perspectives from Canada might be useful.

http://bdti.mastertree.jp/f/huxlpnkd

The UK’s Ministry of Justice has distributed well-written guides about the Bribery Act, which is stricter in key areas than the US Foreign Corrupt Practices Act.

The European Commission's Green Paper on corporate governance and remuneration policies in financial institutions madenumber of significant suggestions, including:

a) limiting the number of board memberships, and requiring greater expertise and qualificationson boards;

b) mandating risk committees and stronger risk management functions;

c) fortifying the legal liability of directors under an expanded duty of care;

d)regulating or restricting stock options; and

The SEC has set forth a time linefor finalized rules as well as tentative timing for future proposals and rulings, with respect to all the changes and studies required by the Dodd-Frank Wall Street Reform and Consumer Protection Act that as signed into law on July 21, 2010.

http://www.sec.gov/spotlight/dodd-frank.shtml

The Dodd-Frank Act itself can be found here:

http://www.sec.gov/about/laws/wallstreetreform-cpa.pdf

The report of the NYSE Commission, issued this fall, summarized this particularreccommendation in the following way in its press release:

While independence is an important attribute for board members, the NYSE’s Listing Standards do not limit a board to just one non-independent director, and boards should seek an appropriate balance between independent and non-independent directors to ensure a proper mix of expertise, diversity and knowledge.

On September 28, ACGA sent a formal letter tothe Ministry of Justice and keymembers ofthe Legislative Advisory Council's Company Law Sub-Committee in Japan. The letter was made public and is available on BDTI's data libary athttp://bdti.mastertree.jp/f/l0ngs7zm.

BDTI hasreceived a new comment on METI'sproposed Joint Audit　Committee Company. Please see below. (Admin.)

What is the general reaction to METI's proposal to amend the Company Law toenable formation ofa thirdtypeof company, a joint audit committee-style company? It isdescribedon pages 36-38 of this document: http://bdti.mastertree.jp/f/os68ejbz

NOTE: the summary translation file that was attached to the comment that was subsequently submitted in response (below) is available at: http://bdti.mastertree.jp/f/p5k7vzjg

(Reply to comment made yesterday.) Your idea* is a good one, but I believe that a much bolder reform of the corporategovernance framework is needed for Japan's markets.

The harsh reality is thatthe quality of corporate governance in Japan has lost much credibility and itslaws and rulesnow lag most other countries in Asia.