TY - CHAP
T1 - The Performance Effects and Determinants of Corporate Governance Reform 1
AU - Miyajima, Hideaki
N1 - Publisher Copyright:
© Oxford University Press, 2013.
PY - 2007/9/1
Y1 - 2007/9/1
N2 - This chapter addresses the introduction of the executive officer system as an alternative to the traditional insider board structure. As a result, since 1997 board sizes have decreased and a greater separation has been made between monitoring and management responsibilities. Some firms have also introduced outside directors and performance-related compensation schemes, such as stock options. The extent of these reforms among Japanese firms is examined using a survey-based Corporate Governance Score (CGS) for each corporation. Higher CGS scores are associated with better performance, a higher percentage of foreign shareholders, and a lower percentage of stable shareholders. However, among firms exposed to capital market pressures, the presence of strong employee participation also has a significant positive impact on the degree of reform and suggests a strong mutual reliance on capital markets and long-term employment among strongly performing Japanese firms.
AB - This chapter addresses the introduction of the executive officer system as an alternative to the traditional insider board structure. As a result, since 1997 board sizes have decreased and a greater separation has been made between monitoring and management responsibilities. Some firms have also introduced outside directors and performance-related compensation schemes, such as stock options. The extent of these reforms among Japanese firms is examined using a survey-based Corporate Governance Score (CGS) for each corporation. Higher CGS scores are associated with better performance, a higher percentage of foreign shareholders, and a lower percentage of stable shareholders. However, among firms exposed to capital market pressures, the presence of strong employee participation also has a significant positive impact on the degree of reform and suggests a strong mutual reliance on capital markets and long-term employment among strongly performing Japanese firms.
KW - Board of directors
KW - Employee participation
KW - Independence
KW - Japanese economy
KW - Non-executive directors
KW - Shareholder rights
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U2 - 10.1093/acprof:oso/9780199284511.003.0012
DO - 10.1093/acprof:oso/9780199284511.003.0012
M3 - Chapter
AN - SCOPUS:84920066753
SN - 9780199284511
BT - Corporate Governance in Japan
PB - Oxford University Press
ER -