A Message from the Chairman

長谷川委員長

Established in 1992, the SESC is celebrating its 25th anniversary in 2017. Our mission is to ensure the integrity of capital markets and to protect investors, thereby contributing to the sound development of Japan’s economy.

Our economy faces various challenges today, as the birthrate declines and the population ages. In light of these challenges, we believe that it is of paramount importance to enhance market transparency and to deter market misconduct that may inhibit investment. We also recognize that the role we play in market surveillance is changing and becoming more important than ever.

Japanese market environment has seen dramatic changes in recent years. Cross-border transactions are on the rise, and markets continue to offer a broader array of financial instruments and services. More specifically, new trading methods, such as algorithmic trading, continue to emerge as information technology advances, while insider trading cases involve the misuse of an ever-increasing range of material facts. Violations of disclosure requirements include large-scale accounting misconduct at one of Japan’s leading global companies, and some listed companies with global operations have failed to establish adequate control systems with respect to their overseas subsidiaries.


To address those concerns, the SESC intends to increase its efforts to implement forward-looking oversight of Japanese markets, including through the collection and analysis of intelligence from macro-economic perspectives. The SESC also intends to enhance its examination and investigation techniques to address the increasingly diverse, complex, and maneuvered issues that it encounters in dealing with market misconduct. Further, the SESC also intends to continue reviewing the appropriateness of information disclosure by large listed companies, in addition to its existing efforts to expose problem companies in general.

In its monitoring of financial instruments business operators, the SESC believes it is essential to further enhance its ability to identify potential risks and strengthen its capabilities to collect and analyze intelligence, with due consideration given to the different characteristics of diverse business models of such firms and of their customers, as well as to their increasingly complex and diverse financial instruments and transactions.

In addition, the SESC will cooperate with overseas regulators to deal with violations involving cross-border transactions, and will continue to take rigorous action against professional investors who engage in market misconduct both at home and abroad.

The SESC will work in close partnership with relevant authorities and self-regulatory organizations to increase the effectiveness and efficiency of its market surveillance and to ensure the integrity of markets and the protection of investors. We seek to demonstrate that we deserve the trust that you place on us. We thank you for your understanding and support.


Mitsuhiro Hasegawa
Chairman
Securities and Exchange Surveillance Commission
Jan. 2017

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