Investors setting up the agenda for Japanese companies

Saxo Capital Markets Australia

It's estimated that Japanese companies are sitting on a combined US$1.9 trillion cash pile. This massive amount of money is the result of companies holding back from capital expenditure and wage rises due to low domestic growth. However, more importantly many corporations do not have a clear strategy for how to put the money work in the future, without firm plans to increase dividends or undertake stock buybacks. It has also always been clear that –to the frustration of global institutional investors– some listed Japanese corporations do not actively engage and communicate with shareholders. Despite pressure from investors, there are significant barriers to a higher level of investor activism and shareholder value emphasis in Japan. But Christoffer Moltke-Leth, Saxo Bank's director of sales trading services for institutional investors, based in Singapore, says the winds are changing. In fact, important developments can already be seen. This new trend could really push companies to stop them from just sitting on their cash. To read more visit: (VIEW LINK)


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