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Trends in Japanese Markets

Goldman SachsBen Ferguson, Liz
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  • Negative interest rates in Japan are anticipated to have been relatively ineffectual, likely causing more harm than benefit to the financial sector.
  • Governance reforms aimed at returning cash to shareholders are expected to slow following lessons learned from the pandemic.
  • Continued activist investor activity is projected in the Japanese market, though requests for share buybacks may be tempered by the current economic environment.
  • Activists are likely to prioritize demands for improved board independence and management-shareholder alignment over capital return mechanisms.
  • Both activist requests and corporate responses are expected to evolve in reaction to the pandemic and prevailing economic conditions.