20250609 TA 10-year since Japan's corporate governance code img

Improving governance of Japanese companies was a key pillar of "Abenomics," the late Prime Minister Shinzo Abe's signature economic program. (Nikkei montage/Source photos by Ken Kobayashi and Mayumi Tsumita)

Japan finally ignites foreign investor interest after decade-long governance push

Companies double down on reforms as Tokyo bourse and activists team up

JADA NAGUMO

June 9, 2025 06:02 JST

TOKYO -- This June marks the tenth anniversary of Japan's adoption of the Corporate Governance Code, which set rules for shareholder rights, disclosures and more. The code was nonbinding but took direct aim at ineffective boards and encouraged listed companies to be more transparent.

Although change has only come gradually, foreign investors are finally seeing signs of companies becoming more receptive to reevaluating their capital allocation strategies, especially following a series of policy initiatives, as well as pressure from the increasing presence of activist investors.