{"id":254,"date":"2016-06-17T08:23:09","date_gmt":"2016-06-17T08:23:09","guid":{"rendered":"https:\/\/www.hibiki-path-advisors.com\/?p=254"},"modified":"2018-11-05T15:35:55","modified_gmt":"2018-11-05T07:35:55","slug":"english-anti-takeover-measures-and-corporate-management","status":"publish","type":"post","link":"https:\/\/www.hibiki-path-advisors.com\/en\/message\/english-anti-takeover-measures-and-corporate-management\/","title":{"rendered":"Anti-takeover Measures and Corporate Management"},"content":{"rendered":"<p><\/p>\n<h2>Anti-takeover Measures and Corporate Management<\/h2>\n<style type=\"text\/css\">\n.table5 {\n  border-collapse: collapse;\n  width:100%;\n}\n.table5 th {\n  background-color: #ffffff;\n}\n.table5 td {\n  text-align: justify;\n}\n<\/style>\n<table class=\"table5\" border=0>\n<tr>\n<td>\nAnnual General Shareholders\u2019 Meeting (AGM) for March fiscal year-ending companies, which still\u3000majority of Japanese companies fall into, are held in June and I believe it is the busiest time of the year\u3000for those who are in corporate headquarters in charge of the AGM.<\/p>\n<p>Looking at the agenda for this year\u2019s meetings, you may have noticed that there is a trend to\u3000respond\u3000favorably to shareholders and investors, as seen in the fact that of the many companies that had put\u3000anti-takeover measures in place, nearly thirty have decided to abolish them, or move towards doing so.\u3000But on the other hand, strikingly, there seem to be 5+ companies that are still trying to put new\u3000anti-takeover measure in place. From the outside we can only guess at what the individual situations\u3000are, and I\u2019m sure management must have its own good reasons, but there is nevertheless an\u3000anachronistic feeling.<\/p>\n<p>Implementation of anti-takeover measure might in a way, give somewhat positive impression to\u3000shareholders (I know I am stretching a bit too far on this)due to lowering of risk that may\u3000arise from\u3000discontinuity of current managementteam. Increased predictability of the corporate strategy is good as\u3000long as the strategy seem to maximize shareholder value. However the counter argument is that with\u3000the implementation of anti-takeover measures, it casts serious threat to market mechanism as\u3000preventing the free trade of securities would increase the risk of management starting to pursue their\u3000own interest rather than shareholder value, widely known as agency problems. As we all know, devils\u3000whisper to us every day. Even in Japan, after a few years of tug-of-war it has become a consensus that\u3000overall, anti-takeover measure has a negative impact on long term shareholder value, evidenced by\u3000most of the publicly announced voting guidelinesby many pension funds and money managers clearly\u3000stating to vote against the measure (and still five+ companies introduce the measure).<\/p>\n<p>Now here is the difficult question. Judging whether the management is undoubtedly putting the\u3000best\u3000effort to increase the long term shareholder value or not should of course not be judged just by recent\u3000quantitative figures of the company. But because intrinsic shareholder value cannot be measured by\u3000simple procedures, management must interact with shareholders and investors and explain with\u3000sincerity and investors need to listen to what they are saying in order to make prudent investment\u3000decisions for their clients. If, for example, implementation of anti-takeover measures may limit the\u3000chance of constructive interaction between management and investors, this could result in lesser\u3000reliable information, and thus increased risk for shareholders and\u3000investors. In the end, it is likely to\u3000result in perpetual undervaluation of the company.\u3000In my personal, perhaps somewhat extreme opinion, if managers are considering setting up takeover\u3000defenses for their company, I feel they should also consider more radical solutions such as a\u3000management buyout or other forms of going private assuming the aim to introduce such measure is\u3000to\u3000limit the noise that may arise from having many differentnoisy shareholders. By becoming a full\u3000subsidiary of a parent company, or going under the umbrella of a certain company or patron, or just\u3000buying it for yourself (yes this is the MBO),the management will free themselves up from being\u3000obligated to explain details to many different parties and can focus on a selected shareholders to fulfill\u3000their accountability obligation. This should clearly enable the management and employees to focus on\u3000their real jobs and goals, resulting, hopefully, in better shareholder value and growth prospects.<\/p>\n<p>In any case, it is extremely encouraging that the overall trend we see is anti-takeover measures being\u3000torn down, many more companies setting up non-statutory committees, more outside directors being\u3000nominated, and more managers coming directly to terms with the significance of being a public\u3000company and striving to increase corporate value. It is wonderful that at the same time equity-based\u3000compensation is becoming more common, and it is taken for granted that directors should be rewarded\u3000based not just on their responsibilities but on the outcome of their efforts. It is my fervent hope that this\u3000trend grows in strength and breadth, and I myself will exert my utmost efforts to promote it.\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Yuya Shimizu<\/p>","protected":false},"excerpt":{"rendered":"\u8cb7\u53ce\u9632\u885b\u7b56\u3068\u4f01\u696d\u7d4c\u55b6 \u3000\u4eca\u5e74\u3082\uff13\u6708\u672b\u6c7a\u7b97\u4f01\u696d\u306e\u682a\u4e3b\u7dcf\u4f1a\u306e\u65e5\u7a0b\u304c\u8fd1\u3065\u3044\u3066\u304d\u307e\u3057\u305f\u3002\u4e8b\u696d\u4f1a\u793e\u306e\u6cd5\u52d9\u3001\u7dcf\u52d9\u3001\u682a\u5f0f\u90e8\u306e\u65b9\u3005\u306b\u3068\u3063\u3066\u306f\u4eca\u304c\u4e00\u5e74\u306e\u4e2d\u3067\u6700\u3082\u3081\u307e\u3050\u308b\u3057\u3044\u65e5\u3005\u3067\u3042\u308b\u3068\u5b58\u3058\u307e\u3059\u3002 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\u3072\u3073\u304d\u30fb\u30d1\u30fc\u30b9\u30fb\u30a2\u30c9\u30d0\u30a4\u30b6\u30fc\u30ba \u4ee3\u8868\u53d6\u7de0\u5f79 \u6e05\u6c34\u96c4\u4e5fAnti-takeover Measures and Corporate Management .table5 { border-collapse: collapse; width:100%; } .table5 th { background-color: #ffffff; } .table5 td { text-align: justify; } Annual General Shareholders\u2019 Meeting (AGM) for March fiscal year-ending companies, which still\u3000majority of Japanese companies fall into, are held in June and I believe it is the busiest time of the year\u3000for those who are in corporate headquarters in charge of the AGM. Looking at the agenda for this year\u2019s meetings, you may have noticed that there is a trend to\u3000respond\u3000favorably to shareholders and investors, as seen in the fact that of the many companies that had put\u3000anti-takeover measures in place, nearly thirty have decided to abolish them, or move towards doing so.\u3000But on the other hand, strikingly, there seem to be 5+ companies that are still trying to put new\u3000anti-takeover measure in place. From the outside we can only guess at what the individual situations\u3000are, and I\u2019m sure management must have its own good reasons, but there is nevertheless an\u3000anachronistic feeling. Implementation of anti-takeover measure might in a way, give somewhat positive impression to\u3000shareholders (I know I am stretching a bit too far on this)due to lowering of risk that may\u3000arise from\u3000discontinuity of current managementteam. Increased predictability of the corporate strategy is good as\u3000long as the strategy seem to maximize shareholder value. However the counter argument is that with\u3000the implementation of anti-takeover measures, it casts serious threat to market mechanism as\u3000preventing the free trade of securities would increase the risk of management starting to pursue their\u3000own interest rather than shareholder value, widely known as agency problems. As we all know, devils\u3000whisper to us every day. Even in Japan, after a few years of tug-of-war it has become a consensus that\u3000overall, anti-takeover measure has a negative impact on long term shareholder value, evidenced by\u3000most of the publicly announced voting guidelinesby many pension funds and money managers clearly\u3000stating to&hellip;","protected":false},"author":1,"featured_media":532,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5,16],"tags":[6],"class_list":{"0":"post-254","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-message","8":"category-16","9":"tag-yuya-shimizu"},"views":5193,"_links":{"self":[{"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/posts\/254","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/comments?post=254"}],"version-history":[{"count":7,"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/posts\/254\/revisions"}],"predecessor-version":[{"id":1248,"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/posts\/254\/revisions\/1248"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/media\/532"}],"wp:attachment":[{"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/media?parent=254"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/categories?post=254"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.hibiki-path-advisors.com\/en\/wp-json\/wp\/v2\/tags?post=254"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}