April 7, 2014
Council of Experts Concerning the Japanese Version of the Stewardship Code

Principles for Responsible Institutional Investors
«Japan’s Stewardship Code»
- To promote sustainable growth of companies through investment and dialogue -
Publication of the final version and invitation to institutional investors to sign up for the Code

1. Finalization of the Japan’s Stewardship Code and Summary of Public Comments

The Council of Experts Concerning the Japanese Version of the Stewardship Code (hereafter, the “Council”) (Chairman: Professor Hiroyuki Kansaku, The University of Tokyo) was established in August 2013 and had met six times since then.

The Council published an exposure draft of the Code and solicited comments from January 15, 2014 through February 9, 2014.

The Council received comments in Japanese from 26 individuals/entities and 19 in English. Based on the received comments, the Council revised and finalized the Code on February 26, 2014.The final version is provided PDFhere(PDF:413KB).

The summary of comments received and the Council’s view on them has been posted in Japaneseopen new window and will soon be published in English as well. The Council expresses its gratitude for valuable comments.

2. Invitation to institutional investors to sign up for the Code

In its preamble, the Code describes the recommended process of the publication of the list of institutional investors who accept the code as follows:

  • 14.To make institutional investors’ acceptance of the Code transparent, the Council expects institutional investors who accept the Code to:

    • publicly disclose on their website their intention to accept the Code and information that are required to be disclosed by the principles of the Code, including the policy on how they fulfill the stewardship responsibilities and, if they do not comply with some of the principles, an explanation of the reason;
    • annually review and update the disclosed information; and
    • notify the Financial Services Agency of the address of their website (the URL) used to disclose the information above.

    The Council also expects the Financial Services Agency to publish information about the institutional investors who have made the disclosure in a tabular form.

In addition to the announcement of the acceptance of the Code, principles of the Code expect supporting institutional investors to disclose the following items:

(1)Principle 1: disclosure of policy on how institutional investors fulfill their stewardship responsibilities
(2)Principle 2: disclosure of policy on how institutional investors manage conflicts of interest in fulfilling their stewardship responsibilities
(3)Principle 5: disclosure of policy on voting (When institutional investors have a practice of lending stocks across the determination date of the voting right, their voting policy should include a policy on lending stocks as well.)
(4)Principle 5: disclosure of voting activity (When institutional investors use the service of proxy advisors, they should publicly disclose the fact and how they utilize the service in making voting judgments as well.)

The above items (1), (2) and (3) are expected to be disclosed publicly together with the announcement of the acceptance of the Code. Along with this, if institutional investors choose not to comply with any of the principles, they should explain the reason for it.

The above item (4) is expected to be disclosed annually.

The Financial Services Agency (FSA) would like to ask accepting institutional investors that all disclosure items be linked to the website (URL) where the announcement of the acceptance of the Code has been disclosed.

Global institutional investors including those who do not have any local offices in Japan can make disclosure either in Japanese or in English (or in both).

Those who newly intend to accept the Code are invited to notify the FSA (jstewardship@fsa.go.jp) of their intention as well as the institution’s name, name of the person in charge, contact information (email address), and the URL where the announcement of the acceptance of the Code and the disclosure items described in the Code have been released.

*The FSA publishes the list of institutional investors who have notified the FSA of their intention to accept the Code. From March 2016, the FSA will update the list any time when it receives the notification of acceptance of the Code from institutional investors. (Updated as of March 24, 2016)

(Appendix) PDFPrinciples for Responsible Institutional Investors «Japan’s Stewardship Code» - To promote sustainable growth of companies through investment and dialogue -(Final version)(PDF:413KB)

Contact

Corporate Accounting and Disclosure Division, Planning and Coordination Bureau, Financial Services Agency
Tel +81-(0)3-3506-6000

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