The evolution of corporate management has always happened at the forefront of the market.
Japanese companies have been increasing corporate value by refining competitiveness through catering Japanese customers’ requests that are said to be the most demanding in the world along with establishing a healthy collaborative relationship between employees and management that we can boast about to the world.
However, where does the relationship between corporate management and the capital markets stand? Even within the context of the shift from indirect finance to direct finance, shareholders have not contributed to supporting corporate management as banks have in the past. This is showcased through the unfortunate fact that 70 % of the listed companies’ capital productivity is less than the capital cost even when looking at the long-term average looking back past 10 years. Ironically, because of this inefficiency the frontiers of Japanese companies’ management lies in the current capital markets. We, as constructivists, will be spearheading the way in moving the distribution of the capital productivity upward to improve nationwide capital productivity.