Activist Toshiba shareholders score landmark win with vote for independent probe
TOKYO (Reuters) – Toshiba Corp shareholders voted on Thursday in favour of an independent investigation into allegations that investors were pressured ahead of last year’s annual general meeting – a landmark win for corporate governance in Japan.
The vote marks only the fourth time that a shareholder motion has won approval in Japan and the first at a major company that is a household name, albeit one sullied by a string of scandals.
It is also notable for the gravity of allegations that emerged after the AGM. Some Toshiba shareholders had felt pressure to vote in line with management’s wishes on director nominations after contact from a government adviser or the trade ministry, sources have previously told Reuters.
“This result shines a very public spotlight on the likelihood that EGMs, which in Japan can be called by a shareholder that has owned only 3% for 6 months, will probably be used more by activists,” said Nicholas Benes, a corporate governance expert and representative director of the Board Director Training Institute of Japan.
The proposal from Effissimo Capital Management, an activist investor and Toshiba’s biggest shareholder, was backed by proxy advisers and required a simple majority of votes at Thursday’s extraordinary general meeting to pass. A breakdown of the vote results was not immediately disclosed.
(Reporting by Makiko Yamazaki; Editing by Edwina Gibbs)