Toshiba shareholders ousted the company’s board of directors in a historic vote that toppled one of the country’s most famous business names in unfamiliar territory and marked a watershed for activism. investors in Japan.
Friday’s decision by shareholders to vote against the resignation of Osamu Nagayama as chairman at the annual meeting was described by some of Toshiba’s largest investors as an inevitable consequence of the company’s long-term failure. company to establish better governance.
The vote against the council chair is not alone exceptionally rare in a corporate world where management is accustomed to unquestionable support, but it has been especially appealing because it has brought down a widely respected business leader.
The AGM followed the release this month of a explosive independent report in the events surrounding Toshiba’s 2020 annual meeting. The report alleged a collusion between the company and the Japanese government to suppress activist shareholders.
In addition to revealing contacts between Toshiba and Japan’s Ministry of Economy, Trade and Industry on how to deal with shareholders, the report’s results contrast with the company’s efforts to investigate the allegations surrounding the AGA.
The report concluded that the AGA 2020 had not been conducted fairly, while Toshiba’s own investigation, under the supervision of its control committee, found no evidence of societal pressure on the ‘shareholders.
Since its publication, the independent document was cited by investors and proxy advisors as a reason to vote against Nagayama’s resignation, who has been chairman of the board for the past year and chairs the nomination committee.
Nagayama was nominated for roles after the 2020 AGM and was not criticized in the independent report, but investors have argued should be responsible for the way Toshiba’s investigation was conducted.
Shareholders also rejected the appointment to the board of Nobuyuki Kobayashi, another member of the control committee, at the meeting, which lasted two and a half hours.
Prior to his move to Toshiba, Nagayama was known to have helped Sony’s turnround and transformed Chugai Pharmaceutical into a global player through its capital link with Switzerland’s Roche.