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Opinion

Japan Inc must back independent boards as a check on hostile takeovers

Yahoo Japan's victorious fight with Askul is ominous precedent

| Japan
The Yahoo Japan-Askul precedent demonstrates that, without independent directors, companies are more vulnerable to hostile takeovers.

Two recent events -- Yahoo Japan's ousting of Askul's CEO and three independent directors, and H.I.S.'s unfolding hostile tender offer for Unizo Holdings -- should prompt corporate Japan to question its failure to adopt a hard legal requirement that listed companies maintain majority independent boards.

The conventional argument in favor of independent boards, the norm in other advanced economies, is that they protect general shareholders from potential abuse at the hands of self-interested management and controlling shareholders.

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