Die Reform des Gesellschaftsrechts vom Mai 2002 und Corporate Governance in Japan

Abstract

Just as in Europe and the U.S., the discussion about corporate governance has lately intensified in Japan, too. One of the major aims of the corporate law reform of 2002 has been an improvement in the Japanese system of corporate governance. Large stock corporations may now choose between three different organizational forms. First, companies may keep their traditional structure. However, in this case the board has to delegate the task of running the daily business and representing the company to some of its members. The board as such controls these managing directors. In addition, as has been the practice before, an audit committee controls the management. At least half of the auditors have to be externs, i.e., they must not be, or must not have been, employed by the company. Following the second model, a corporation has to establish, within the board, three mandatory committees for auditing and for the remuneration and appoint-ment of the directors, and the board, in turn, has to appoint one or more officers re-sponsible for the daily business. Thus there is a separation between managing and supervisory functions. Additional auditors are not required. Under the third model, a board may install a committee that is responsible for all financially important deci-sions. In a recent poll, many companies declared an interest in adopting one of the new models. Whether the new system will work in practice remains to be seen.

(The Editors)