Executive Director, Metrical Inc

Aki Matsumoto

Executive Director

Independent Leading Corporate Governance Research

Metrical Inc

METRICAL INC. is an independent leading Corporate Governance research firm in Japan where Corporate Governance is increasingly recognized as an important element on corporate management in these days. Thus, CG research and solutions would become an essential component of global capital markets and play important to contribute to transparency of the markets and maximize shareholders’ value in Japan. 

METRICAL INC. provides Corporate Governance research and analysis including rating services, and  also offers investment research and IR services with solutions and customized profound research on CG and IR issues.

<ul>
<li>It seems unlikely that there'll be an increase in formal criteria for corporate governance, like in the previous revision. It looks like there'll be more demand for human capital disclosure.</li>
<li>Many companies don't fully understand human capital, and there's concern that achieving disclosure criteria will become the goal, rather than original objective of investing in human capital to create value.</li>
<li>The revised Corporate Governance Code requires verification that management resources are being appropriately allocated to investment and shareholder returns. It seems that simpler questions are better than difficult “technical terms.”</li>
</ul>


It seems unlikely that there'll be an increase in formal criteria for corporate governance, like in the previous revision. It looks like there'll be more demand for human capital disclosure.
Many companies don't fully understand human capital, and there's concern that achieving disclosure criteria will become the goal, rather than original objective of investing in human capital to create value.
The revised Corporate Governance Code requires verification that management resources are being appropriately allocated to investment and shareholder returns. It seems that simpler questions are better than difficult “technical terms.”


How Many Companies Will Be Able to Keep up with the Next Revision of the Corporate Governance Code?

Equity/Index & Cross Asset Volatility Specialist, Cameron Design

Jay Cameron

Equity/Index & Cross Asset Volatility Specialist

Cameron Design

We specialize in financial products and volatility. Our strategies balance speed, data, and risk control to capture opportunities across global markets. Our research leverages AI and data analytics to continuously refine our algorithms and adapt to evolving market dynamics.

Equity Derivatives

<ul>
<li>Sustained pressure from the JPX initiative targeting firms trading below P/B is forcing enhanced capital returns (buybacks and dividends), creating opportunity across both indices.</li>
<li>BoJ's shift to a positive rate environment is fundamentally restoring Net Interest Income and profitability to the Financials sector, positioning the TOPIX, in particular, for outperformance.</li>
<li>AI/Tech Sector Dominance: The Nikkei 225 is driven by high-tech firms. This concentration, led by high-priced high weighted stocks like Advantest and Softbank Group, provides high-beta AI exposure</li>
</ul>


Sustained pressure from the JPX initiative targeting firms trading below P/B is forcing enhanced capital returns (buybacks and dividends), creating opportunity across both indices.
BoJ's shift to a positive rate environment is fundamentally restoring Net Interest Income and profitability to the Financials sector, positioning the TOPIX, in particular, for outperformance.
AI/Tech Sector Dominance: The Nikkei 225 is driven by high-tech firms. This concentration, led by high-priced high weighted stocks like Advantest and Softbank Group, provides high-beta AI exposure


2026 High Conviction - Japan's Triple Play: How PBR Reform, AI, and Banks Unlock Alpha

<ul>
<li>Data suggests that share buybacks/share cancellations are expected to have positive effect on ROE/ROA, while companies with low valuations increasingly utilize share buybacks as a measure to raise stock prices.</li>
<li>Overseas investors share the value that companies should have business plans for growth and return surplus cash after investment to shareholders. There's gap between investors and companies inn this value.</li>
<li>More effective approach would be to require management to fulfill accountability by explaining fundamentals of returning unused cash to shareholders and disclosing business plans if they wish to retain cash.</li>
</ul>


Data suggests that share buybacks/share cancellations are expected to have positive effect on ROE/ROA, while companies with low valuations increasingly utilize share buybacks as a measure to raise stock prices.
Overseas investors share the value that companies should have business plans for growth and return surplus cash after investment to shareholders. There's gap between investors and companies inn this value.
More effective approach would be to require management to fulfill accountability by explaining fundamentals of returning unused cash to shareholders and disclosing business plans if they wish to retain cash.


The Data Also Shows that Companies with Low Stock Valuations Are Increasingly Using Share Buybacks

<ul>
<li>Although corporate governance in Japan has gradually improved over the past decade, many listed companies have failed to achieve their management goal of sustainable growth in corporate value.</li>
<li>TSE seems to believe that the underlying problem is that management does not recognize “capital costs” and is therefore unable to concentrate resources on businesses that can secure sufficient margins.</li>
<li>I believe that the problem stems from a lack of awareness that free cash flow belongs to shareholders and that companies have a fiduciary duty to shareholders.</li>
</ul>


Although corporate governance in Japan has gradually improved over the past decade, many listed companies have failed to achieve their management goal of sustainable growth in corporate value.
TSE seems to believe that the underlying problem is that management does not recognize “capital costs” and is therefore unable to concentrate resources on businesses that can secure sufficient margins.
I believe that the problem stems from a lack of awareness that free cash flow belongs to shareholders and that companies have a fiduciary duty to shareholders.


Proxy Voting at AGMs Is Good Opportunity for Investors to Think if Managers Fulfill Fiduciary Duties

<ul>
<li>While very few companies allocate cash appropriately, many companies simply announce small-scale share buybacks, resulting in cash being used in a half-hearted manner for both growth and shareholder returns.</li>
<li>The problem is that many managers lack awareness of their fiduciary responsibility to make sincere decisions on cash allocation based on the idea that free cash flow belongs to shareholders.</li>
<li>Even for listed companies, the time has come to discuss the role of managers who are unable to thoroughly fulfill their fiduciary duties to shareholders.</li>
</ul>


While very few companies allocate cash appropriately, many companies simply announce small-scale share buybacks, resulting in cash being used in a half-hearted manner for both growth and shareholder returns.
The problem is that many managers lack awareness of their fiduciary responsibility to make sincere decisions on cash allocation based on the idea that free cash flow belongs to shareholders.
Even for listed companies, the time has come to discuss the role of managers who are unable to thoroughly fulfill their fiduciary duties to shareholders.


Rather than “Technical Guidance,” What Is Needed Is Thorough Fiduciary Duty to Shareholders

Japan

The TOPIX, also known as the Tokyo Stock Price Index, is a capitalization-weighted index of all companies listed on the First Section of the Tokyo Stock Exchange. The index is supplemented by the subindices of the 33 industry sectors. The index calculation excludes temporary issues and preferred stocks, and has a base value of 100 as of January 4, 1968.

TSE Tokyo Price Index TOPIX (TPX INDEX)

How Many Companies Will Be Able to Keep up with the Next Revision of the Corporate Governance Code?

I would like to discuss the Nikkei article dated June 2, “Financial Services Agency Requests Disclosure of Salary Increase/Decrease Rates; Third...

Metrical Inc

2026 High Conviction - Japan's Triple Play: How PBR Reform, AI, and Banks Unlock Alpha

JPX initiative pressures firms to enhance capital returns, BoJ's positive rate shift boosts Financials, Nikkei 225 driven by high-tech firms for...

Jay Cameron

Proxy Voting at AGMs Is Good Opportunity for Investors to Think if Managers Fulfill Fiduciary Duties

I would like to discuss the issues on the Nikkei newspaper article dated June 12, titled “Appointment of top management opposed due to ROE falling...

Metrical Inc

Rather than “Technical Guidance,” What Is Needed Is Thorough Fiduciary Duty to Shareholders

I would like to discuss the June 11 article, “Share buybacks reach record high of 12 trillion yen in January-May; companies rush to improve capital...

Metrical Inc

How Many Companies Will Be Able to Keep up with the Next Revision of the Corporate Governance Code?

I would like to discuss the Nikkei article dated June 2, “Financial Services Agency Requests Disclosure of Salary Increase/Decrease Rates; Third...

Metrical Inc

2026 High Conviction - Japan's Triple Play: How PBR Reform, AI, and Banks Unlock Alpha

​JPX initiative pressures firms to enhance capital returns, BoJ's positive rate shift boosts Financials, Nikkei 225 driven by high-tech firms for...

Jay Cameron

The Data Also Shows that Companies with Low Stock Valuations Are Increasingly Using Share Buybacks

I would like to discuss the issues on the June 12 Nikkei newspaper article, “Share Buybacks Impact Stock Prices; Mention of Undervaluation Leads to...

Metrical Inc

Proxy Voting at AGMs Is Good Opportunity for Investors to Think if Managers Fulfill Fiduciary Duties

I would like to discuss the issues on the Nikkei newspaper article dated June 12, titled “Appointment of top management opposed due to ROE falling...

Metrical Inc

Rather than “Technical Guidance,” What Is Needed Is Thorough Fiduciary Duty to Shareholders

I would like to discuss the June 11 article, “Share buybacks reach record high of 12 trillion yen in January-May; companies rush to improve capital...

Metrical Inc

JPX initiative pressures firms to enhance capital returns, BoJ's positive rate shift boosts Financials, Nikkei 225 driven by high-tech firms for...