Theme 1 · Foundations
Why this theme exists
Every regulator‑grade reform in Japan since 2014 traces back to one structural fact: for two decades after the 1989 Nikkei peak, Japanese listed companies earned a return on equity roughly half of their US peers — and the gap was not closing. That number, and the political authorisation to do something about it, is the foundation. Without it, none of the codes, segment reshuffles, or disclosure lists in the later themes would have happened.
Theme 1 puts the IR rep on solid historical ground. By the end you will know:
- Why 8 % became the most‑cited number in Japanese capital markets (the Ito Review of August 2014).
- What the pre‑reform architecture actually was — main bank, cross‑shareholdings, insider boards, statutory auditors — and why it stopped working.
- How Abenomics' Third Arrow converted a finance‑ministry concern into a Cabinet‑backed reform programme.
- Why Japan's Stewardship Code came first (February 2014, before the CG Code) and how it has been revised three times since.
The arc in one sentence
Japan's post‑bubble capital‑efficiency gap created the political space; the Ito Review and Abenomics' Third Arrow opened the policy door; and the Stewardship Code walked through it first, with the CG Code following 16 months later.
Posts in this theme
| # | Title | Visual |
|---|---|---|
| 1.1 | Why 8 % Was the Number That Changed Japan | ROE/ROIC comparison table |
| 1.2 | From Main Bank to Mizuno: Japan's pre‑reform architecture | Keiretsu network diagram |
| 1.3 | Abenomics' Third Arrow: how governance became growth policy | 2012–2015 reform timeline |
| 1.4 | The Two Wheels of the Cart: Japan's Stewardship Code | Stewardship Code revision diff (2014/2017/2020/2025) |
Reading order
Linear (1.1 → 1.2 → 1.3 → 1.4) is recommended. Post 1.1 sets up the why; 1.2 explains the what was there before; 1.3 explains the political authorisation; 1.4 examines the first concrete instrument.
What you carry into Theme 2
- The 8 % ROE benchmark and where it came from.
- A vocabulary for pre‑reform Japan: keiretsu, mochiai, kansayaku, main bank, salaryman CEO.
- The 2013 Japan Revitalization Strategy as the political mandate document.
- The Stewardship Code's seven (later eight) principles as the first comply‑or‑explain regime in Japan — the template the CG Code will follow.