Stephen Givens is a corporate lawyer based in Tokyo.
As Japan’s rainy season descends and shareholder proposals for June-end annual general meetings begin to trickle in, Hong Kong-based LIM Advisors’ approach to unlocking value in Japanese companies with low price-to-book ratios is, if nothing else, a diverting contrast to the usual menu of activist demands for higher dividends and share buybacks.
Rather than delving into balance sheet economics to persuade fellow shareholders to vote for a dividend or share buyback, LIM seems to be simply lobbing flares over the wall that illuminate corporate scandals within the target company, but without linking the proposals to demands for concrete action like a dividend or stock buyback that would have a direct economic impact.
No doubt, shareholder proposals that call unwelcome attention to corporate scandals create stress and embarrassment for target company executives and can be entertaining for spectators. The…