Press Conference by SUZUKI Shunichi, Minister of Finance and Minister of State for Financial Services

(Excerpt)

(Friday, January 28, 2022, ８:47 am to ８:49 am)

[Questions and answers:]

Q.

I would like to ask you about the review of the quarterly disclosure system that the Prime Minister Kishida often refers to. Upon delivering a policy speech to the Diet last October and at the current Diet session, the Prime Minister mentioned the idea to review the quarterly disclosure system. The Liberal Democratic Party also makes a campaign pledge for the House of Representatives election to review the system for promoting R&D activities and investment in human resources on a long-term basis. Some express concern about the possibility that quarterly disclosure requirements may lead to so-called short-termism, while others say that the system has already been established and rooted and the review might be perceived as a step backwards in Japanese companies' information disclosure. While this issue will be earnestly discussed at the Financial System Council from now, please provide your view at present regarding why the review of the quarterly disclosure system is necessary at this point in time and about a forecast of future discussions.

A.

Prime Minister Kishida thinks it is important for companies to run businesses from a long-term perspective and expresses his commitment to promoting enhanced disclosure of non-financial information and reviewing the quarterly disclosure system. Under the new capitalism that the Kishida administration aims to achieve, it is important for companies to place emphasis on long-term growth rather than on short-term profits and run businesses so that not only shareholders but various other stakeholders including employees can receive benefits. I understand that there is an opinion also from economic quarters that the quarterly disclosure system should be reviewed as the system foments investors and companies’ preference of short-term profits while medium- to long-term corporate value has come to be more and more emphasized. At the same time, I understand that there is also an opinion that it is necessary to check the progress of the business performances from the viewpoint of assessing medium-term corporate value. Accordingly, at the Financial System Council, we would like to discuss this issue carefully, including the need to enhance disclosure of information about investment in human resources. Regarding the timing of compiling the points of discussions, we would like to make a report by around this spring.