The revised Corporate Governance Code calls on boards to take appropriate risks to support growth investment, raising questions about the company-wide risk management and internal controls that underpin this approach. Some have also pointed out that Japanese companies lack the third layer of the four-layer structure.
The revised Corporate Governance Code is described as calling on boards to take appropriate risks to support growth investment. This presupposes the establishment of a framework for overseeing risk across the entire company.
The article points out that the way company-wide risk management and internal controls are structured is directly linked to the ability to execute growth investment, and stresses the importance of strengthening them.
It also presents an analysis that Japanese companies lack the third layer of the four-layer structure supporting governance, and states that the functions and consistency of each layer need to be enhanced.