5. Corporate Relations: Keiretsu, Cross-Shareholdings, and the Main Bank

A small (100,000 m²) rhodolith bank located at the Arvoredo Marine Biological Reserve (Santa Catarina, Brazil) has been surveyed to determine the main bank components, the community structure, and carbonate production rates. Data from five photographic transects perpendicular to Arvoredo Island shore were complemented with sediment samples and shallow cores, all collected by scuba diving. The main bank component is the unattached, nongeniculate, coralline red algae Lithophyllum sp., used as substrate by the zoanthid Zoanthus sp. Percentage cover of living and dead coralline algae, zoanthids and sediment patches account for nearly 98% of the investigated area. Classification and ordination of samples showed that differences in the proportion of live and dead thalli of Lithophyllum sp. determine the relative abundances of zoanthids. Results also indicate that similarity of samples is high and community gradients are subtle. Significant differences in percentage cover along transects are concentrated in the central portion of the bank. Low carbonate content of sediments from deeper samples suggests low rates of recruitment and dispersal of coralline algae via fragmentation. However, carbonate production of Lithophyllum sp ranging from 55-136.3 g m-2 yr-1 agrees with production rates reported for other temperate settings. In the long run, rhodolith density at Arvoredo Is. is likely to be dependent upon random dispersal of spores and/or fragments from other source areas.

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The decrease in diversification and corporate governance: evidence from Japanese firms

Corporate Ownership and Control ◽

10.22495/cocv6i4p3 ◽

2009 ◽

Vol 6 (4) ◽

pp. 28-39

Author(s):

Hidetaka Aoki

Keyword(s):

Firm Performance ◽

Capital Market ◽

Firm Value ◽

Boards Of Directors ◽

Manufacturing Firms ◽

Business Units ◽

Unrelated Diversification ◽

Japanese Firms ◽

Bubble Economy ◽

Main Bank

This paper analyzes the effects of firm performance and governance factors on the decrease in diversification of Japanese firms in the 1990s. We focus on the cases of the decrease in diversification, because many previous studies proved that diversification caused firm value discount. Adjusting an excessive unrelated diversification would be an important topic, because the problems of low synergy between business units, inefficiency in management and so on were more serious in this type of diversification. The findings of this study are as follows. In the first half of the 1990s, immediately after the collapse of bubble economy, lower firm performance and main bank relationship encouraged firms to decrease the level of diversification of their businesses. On the other hand, in the latter half of the 1990s when the decrease in diversification itself was activated, higher performing non-manufacturing firms and manufacturing firms with lower profitability but facing higher growth in their main business tried to decrease diversification in order to strengthen the competitiveness in main businesses. Also, this kind of decrease in diversification was supported by the governance characteristics such as insider majority smaller boards of directors and the pressure from capital market.

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The financial system and corporate governance in Japan

Corporate Ownership and Control ◽

10.22495/cocv3i3p2 ◽

2006 ◽

Vol 3 (3) ◽

pp. 27-28 ◽

Cited By ~ 2

Author(s):

Mitsuaki Okabe

Keyword(s):

Corporate Governance ◽

Information And Communication Technologies ◽

Institutional Investors ◽

Communication Technologies ◽

Japanese Economy ◽

Information And Communication ◽

Japanese Corporations ◽

Main Banks ◽

Cross Shareholdings

Corporations may be said to be engines of any market economy and their proper behavior is a key to economic, hence human, security. This paper argues that one of the most important causes for the prolonged period of recessions of the Japanese economy in the 1990’s is deeply rooted in the long-established financial structure of the economy and in the closely related issue of corporate governance. Although Japanese corporations have been traditionally understood that their activities are monitored and governed by “main banks,” this framework has been changing over the last 10-15 years toward corporate governance driven by pressure from capital markets. This change has been necessitated by: (a) less need on the part of corporations to rely on banks in acquiring funds, (b) ongoing dissolution of cross shareholdings, (3) an increasing importance for the role of institutional investors, and (4) innovations in information and communication technologies. The change may be regarded as being one from “process innovation” toward a system conducive to “product innovation;” hence a desirable shift. There remain, however, a number of policy tasks, such as institutional improvement in securities investment trusts and the need to better define the role of institutional investors

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Creditor-Focused Corporate Governance: Evidence from Mergers and Acquisitions in Japan

Journal of Financial and Quantitative Analysis ◽

10.1017/s002210901100024x ◽

2011 ◽

Vol 46 (4) ◽

pp. 1051-1072 ◽

Cited By ~ 18

Author(s):

Vikas Mehrotra ◽

Dimitri van Schaik ◽

Jaap Spronk ◽

Onno Steenbeek

Keyword(s):

Corporate Governance ◽

Mergers And Acquisitions ◽

Dominant Role ◽

Sharp Contrast ◽

Distinctive Features ◽

Target Firms ◽

The World ◽

Main Bank ◽

The U.S

AbstractMergers in Japan have the dubious distinction of not creating wealth for shareholders of target firms, in sharp contrast to what occurs in much of the rest of the world. Using a sample of 91 mergers from 1982 through 2003 we document several distinctive features of the merger market in Japan: Mergers tend to be countercyclical and appear to be driven chiefly by creditor concerns. In particular, where the merging firms share a common main bank, we find that merger gains are lower. Overall, our results point to a market that is distinctly less shareholder focused than that in the U.S., and a market where creditors play an important, perhaps dominant, role in corporate governance.

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