The Obstacle: ‘Group Shareholders’
Over the past two years, Sparx submitted proposals to Teikoku similar to AVI’s. Although in the best interests of all shareholders, the proposals failed to receive majority approval because Teikoku’s “Group Shareholders” supported Teikoku’s management despite Teikoku’s unhealthy and value destructive balance sheet.

The core members of Teikoku’s “Group Shareholders” are well-known companies and financial institutions who hold shares in Teikoku based on business ties and historic relationships. They include Sompo Holdings (TSE:8630), Mizuho Bank, Meiji Yasuda Life Insurance, Marubeni (TSE:8002), Hulic (TSE:3003), Morita (TSE:6455), Nishimatsu Construction (TSE:1820) and Teijin Frontier, a wholly-owned subsidiary of Teijin (TSE:3401).

While they pay lip service to corporate governance, passively voting their shares in support of the Board harms the interests of general shareholders and is inconsistent with accepted principles of good governance. This is a systemic problem across corporate Japan and must come to an end to allow for much-needed reforms.
IT IS TIME FOR TEIKOKU’S “GROUP SHAREHOLDERS” TO STOP VOTING PASSIVELY WITH MANAGEMENT AND VOTE IN THE INTERESTS OF ALL SHAREHOLDERS AND BEST GOVERNANCE PRACTICES
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