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.

Employee Stock Compensation Plans Need to Be Designed to Increase Employee Engagement

No Consistent Relationship Between Executive Compensation and Stock Price/ Earnings Has Been Seen

Evaluate Not Only Board Practices, but Also Key Actions to See if They Are Leading to Value Creation

"TSE's Request" Could Be a Harvest that Has Made It Easier to Compare Managers with Stock Valuations

Move to Company with Statutory Committees Is Shortcut to Make the Compensation Committee Functional

New Index Distracts from Prime Market Issues While Providing Long/Short Opportunities for Investors

Executive Director, Metrical Inc

Aki Matsumoto

Executive Director

<ul>
<li>Overseas investors have called for increasing the ratio of variable compensation to executive compensation. Given that foreign ownership ratios have remained high, this upward trend is expected to continue.</li>
<li>Few companies use capital efficiency like ROE as KPIs for variable compensation, which is consistent with the fact that few companies set them as numerical targets in mid-term management plans.</li>
<li>The role of independent directors has become more important as more companies are involving compensation committees in the compensation determination process since the 2001 amendments to the Companies Law.</li>
</ul>


Overseas investors have called for increasing the ratio of variable compensation to executive compensation. Given that foreign ownership ratios have remained high, this upward trend is expected to continue.
Few companies use capital efficiency like ROE as KPIs for variable compensation, which is consistent with the fact that few companies set them as numerical targets in mid-term management plans.
The role of independent directors has become more important as more companies are involving compensation committees in the compensation determination process since the 2001 amendments to the Companies Law.


Fewer Companies Still Use Capital Efficiency Such as ROE as KPIs for Variable Compensation

TSE Tokyo Price Index TOPIX

Fewer Companies Still Use Capital Efficiency Such as ROE as KPIs for Variable Compensation