Category: Management
VideoBloomberg: ”Loeb Prevails in Latest Crusade to Reform Corporate Japan”
”The idea of an octogenarian CEO in questionable health ousting a potential successor to make way for his own son would be met by hackles, maybe even outright laughter, by many corporate governance experts and shareholder activists in the U.S. and Europe. Yet that’s what Dan Loeb accused Seven & i Holdings Co. Chief Executive Officer […]
Daniel E. Wolf et al ：”Social Covenants in Mergers: Legal Promises or Moral Commitments?”
‘With the return of acquirer stock as a featured form of consideration in many recent deals, dealmakers are once again focusing on “social” issues in striking a merger agreement. As compared to most straight cash takeovers where price garners the overwhelming share of, if not exclusive, attention, an acquisition featuring stock consideration, and especially a so-called merger-of-equals, often involves significant discussion between the parties of softer issues, including governance, board composition, management, people, and corporate identity (e.g., corporate and brand names, headquarters and facility locations, and charitable and community commitments). A number of deal developments over the last few years highlight some of the risks and considerations unique to these social terms.
Terry Lloyd: ”Sharp: How Not to Sell a Company in Japan”.
E-biz news in Japan
”Late last week, Mr. Terry Gou, the CEO of Foxconn Technology Group (also known as Honhai) signed a JPY389bn deal to take control of Sharp, one of Japan’s bedrock electronics firms. The signing came after a protracted cat-and-mouse game played between Mr. Gou, the management of Sharp, and in the wings, the public-private INCJ fund. Mr. Gou showed consummate deal sense in luring Sharp’s board with a much more attractive offer than the government’s INCJ (which wanted to break up the firm) then drag out the negotiations as Sharp was facing a possible collapse. Lastly, with impeccable timing he sprang a last minute demand to reduce the deal price by 20% and completely out-maneuvered, Sharp’s executives and shareholders, who eventually caved in and agreed.
Bloomberg: ”Loeb Takes on Seven & I Board in Test Case for Japan Governance”
”The latest activist showdown involving billionaire investor Dan Loeb has the makings of a test case for the progress Japan Inc. boards have made in improving governance.
” Executive Stock Ownership Guidelines”
”Public companies are beholden to align long-term interests of executive officers with those of their shareholders, and this balance often manifests in how executives are paid in relation to company performance. Many companies address this through use of equity packages, but because executives can still sell or hedge these shares, their incentives to make long-term decisions for the company are not always clear. To avoid this, many companies implement stock ownership guidelines, requiring executives to own a certain amount of equity in the company.
ADB Economics Working Paper Series – ”Women’s Leadership and Corporate Performance” by Meijun Qian
This paper reviews the concept, theory, and international evidence on gender diversity and its relation to financial performance.
”Why Can’t Boards Get CEO Succession Right?”
”It’s been 25 years since Professor Jeffrey Sonnenfeld’s landmark book The Hero’s Farewell vividly documented the challenges and failures of CEO succession planning at large publicly traded companies, and not much has changed beyond the exponential growth in what the top executives get paid.
”Shareholder Activism & Engagement 2016”
”At the end of another record-breaking year for shareholder activism activity, it is appropriate that we ring in the publication of this, the inaugural edition of Shareholder Activism & Engagement, part of the Getting the Deal Through series. We are pleased to serve as editors of this volume because we believe that shareholder activism is and will remain in sharp focus in financial markets, in the C-suite and in the boardroom, and that shareholder engagement is, and will continue to be, a leading and increasingly sophisticated priority. The international approach of the Getting the Deal Through series is especially apt for this topic, which we expect to become increasingly global over time, with ‘imports’ and ‘exports’ of shareholder activism and engagement between jurisdictions. Although the United States remains its dominant market, such activism and a heightened sensitivity to shareholder engagement is truly a global phenomenon.
Research Paper by Kodama et al ” Transplanting Corporate Culture across International Borders: FDI and female employment in Japan”
Abstract
”This paper examines the effect of foreign ownership on gender-related employment outcomes and work practices in Japan. The data indicate that the proportion of females among workers, managers, directors, and board members is higher, and the gender wage gap is smaller, in foreign affiliates than in domestic firms of comparable size operating in the same industry. Foreign affiliates are also more likely to offer flexible working arrangements, telecommuting, and child care subsidies. These effects are mostly visible in older affiliates and are more pronounced in affiliates with a larger foreign ownership share. These patterns are in line with the view that it takes time to transplant corporate culture to an overseas affiliate and that a higher ownership stake may facilitate this process……”