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Japan's corporate governance gets some long-overdue scrutiny

Encouraged by new codes, institutional investors turn up the heat on management

Japanese companies have been getting an earful from investors lately. As scandals envelop Toshiba, Fujifilm group and air bag maker Takata, demands for better corporate governance across all of Japan Inc. are growing louder -- and they are being heard.

TOKYO -- "If all the people sitting there were replaced, the corporate culture would change instantly," one irritated shareholder said at Toshiba's annual shareholders meeting on June 28, drawing applause from the other attendees. The scandal-hit electronics giant has decided to sell its semiconductor business and is on the verge of breaking up.

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