The Future of Japanese Corporate Governance: Participation, Sustainability, and Technology

This paper examines the development of corporate governance in Japan over the last fifteen years to understand what has changed and whether the intended results have been achieved. First, it demonstrates how corporate Japan is moving away from the post-war bank-dominated, heavy-industry led, and interlocked model. This provides a new corporate model for Japan for comparative research into law and economics. In addition, we examine how reform was accomplished, considering the legal tools used as well as the dynamics among the various stakeholders. Secondly, the paper shows how this new corporate model for Japan can catalyze sustainability through encouraging companies to be more purpose-based and through digital governance. Finally, we offer some concluding remarks.