TOKYO (Reuters) – The Tokyo Stock Exchange’s role from now on is to facilitate constructive dialogue between companies and investors, rather than imposing business management, its chief said on Thursday.
“The real power to effect change lies with investors and shareholders,” Hiromi Yamaji, chief executive of Japan Exchange group, which runs the Tokyo Stock Exchange, told a briefing in Tokyo.
The exchange’s efforts to encourage companies to improve their management practices and corporate value lifted local stocks. The average share hit a 34-year high in February this year.
But Yamaji said forcing companies to change their management practices could be counterproductive because it could backfire.
“Reform is not sustainable unless companies take voluntary action,” Yamaji said.
Yamaji also said he hoped Japanese Prime Minister Shigeru Ishiba would promote policies to boost private sector growth and continue his predecessor Fumio Kishida’s efforts to encourage a shift from savings to investment.
