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>Companies that responded that they disclosed their annual securities reports prior to the AGM in response to investor needs are considering postponing the timing of their shareholders' meetings.</li>
<li>Annual securities reports are legal documents, and false statements are punishable by law, so the level of authenticity differs from other documents. It takes time to read them for AGM.</li>
<li>There needs to be an increase in the number of investors who carefully read annual securities reports and use them to make investment decisions.</li>
</ul>


Companies that responded that they disclosed their annual securities reports prior to the AGM in response to investor needs are considering postponing the timing of their shareholders' meetings.
Annual securities reports are legal documents, and false statements are punishable by law, so the level of authenticity differs from other documents. It takes time to read them for AGM.
There needs to be an increase in the number of investors who carefully read annual securities reports and use them to make investment decisions.


Annual Securities Reports Are Legal Documents, so They Carry More Significance than Other Documents

<ul>
<li>Companies with low CEO approval ratings at AGMs are likely to implement measures that will be effective by the following year's AGM, which is thought to affect stock price performance.</li>
<li>A low approval rate tends to mean that foreign shareholding ratio is high. Foreign investors invest in companies with potential to significantly increase corporate value if they can solve problems.</li>
<li>Many of the companies that currently enjoy superior returns on capital, stock valuations, and corporate governance practices have improved their management through the backdrop of high foreign ownership (voting power).</li>
</ul>


Companies with low CEO approval ratings at AGMs are likely to implement measures that will be effective by the following year's AGM, which is thought to affect stock price performance.
A low approval rate tends to mean that foreign shareholding ratio is high. Foreign investors invest in companies with potential to significantly increase corporate value if they can solve problems.
Many of the companies that currently enjoy superior returns on capital, stock valuations, and corporate governance practices have improved their management through the backdrop of high foreign ownership (voting power).


Ultimately, It Is the Power of Voting that Can Reform Management

<ul>
<li>It's true that measures to raise P/B that focus on strengthening shareholder returns are unpopular with investors, while excess cash on hand should be returned to shareholders under stagnated ROE.</li>
<li>Both bond and equity investors are focused on the future cash flow a company will generate, and increasing cash flow is consistent with the goals of a public company.</li>
<li>If a company can't use cash reserves to increase corporate value, it should either return excess cash to shareholders or change to a manager that can use cash for growth.</li>
</ul>


It's true that measures to raise P/B that focus on strengthening shareholder returns are unpopular with investors, while excess cash on hand should be returned to shareholders under stagnated ROE.
Both bond and equity investors are focused on the future cash flow a company will generate, and increasing cash flow is consistent with the goals of a public company.
If a company can't use cash reserves to increase corporate value, it should either return excess cash to shareholders or change to a manager that can use cash for growth.


Both Bond Investors and Stock Investors Are Focused on Future Cash Flows that a Company Will Produce

<ul>
<li>Corporate Governance Code, which makes the appointment of outside directors mandatory, was introduced in the hope of restructuring corporate governance and restoring profitability.</li>
<li>We must explore why, as the role of outside directors expands and dependence on them grows, the challenges of profitability and rising stock prices remain far from being resolved.</li>
<li>It's a good idea to have half of directors be independent outside directors. Companies with fewer than that should improve the skills of the entire BOD to increase their effectiveness.</li>
</ul>


Corporate Governance Code, which makes the appointment of outside directors mandatory, was introduced in the hope of restructuring corporate governance and restoring profitability.
We must explore why, as the role of outside directors expands and dependence on them grows, the challenges of profitability and rising stock prices remain far from being resolved.
It's a good idea to have half of directors be independent outside directors. Companies with fewer than that should improve the skills of the entire BOD to increase their effectiveness.


As Role of Outside Directors Becomes More Important, Is Effectiveness of BODs Improving Accordingly?

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

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)

Annual Securities Reports Are Legal Documents, so They Carry More Significance than Other Documents

I have considered the Nikkei newspaper article dated August 1 2025, “Submission of Annual Securities Reports Prior to AGMs and July AGMs.”

Metrical Inc

Ultimately, It Is the Power of Voting that Can Reform Management

I'd like to discuss the August 1 Nikkei article, "President's 'low approval rating' at AGM; expectations for reform proposals in autumn; Taisei...

Metrical Inc

Both Bond Investors and Stock Investors Are Focused on Future Cash Flows that a Company Will Produce

I would like to discuss the issues on the Nikkei newspaper article published on July 29, "P/B and credit rating: killing two rabbits."

Metrical Inc

As Role of Outside Directors Becomes More Important, Is Effectiveness of BODs Improving Accordingly?

I would like to discuss the issues on the July 27 Nikkei article titled "If a company goes private, shareholders should be provided with ample...

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

Annual Securities Reports Are Legal Documents, so They Carry More Significance than Other Documents

I have considered the Nikkei newspaper article dated August 1 2025, “Submission of Annual Securities Reports Prior to AGMs and July AGMs.”

Metrical Inc

Ultimately, It Is the Power of Voting that Can Reform Management

I'd like to discuss the August 1 Nikkei article, "President's 'low approval rating' at AGM; expectations for reform proposals in autumn; Taisei...

Metrical Inc

Both Bond Investors and Stock Investors Are Focused on Future Cash Flows that a Company Will Produce

I would like to discuss the issues on the Nikkei newspaper article published on July 29, "P/B and credit rating: killing two rabbits."

Metrical Inc

As Role of Outside Directors Becomes More Important, Is Effectiveness of BODs Improving Accordingly?

I would like to discuss the issues on the July 27 Nikkei article titled "If a company goes private, shareholders should be provided with ample...

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

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