The Tokyo Stock Exchange held the 30th Follow-up Meeting on the Review of Market Segments on 14 October. The current status of the request, now in its fourth year, and the policy for future initiatives were made public.
At the 30th Follow-up Meeting on the Review of Market Segments held on 14 October, the Tokyo Stock Exchange explained the materials published as part of this special feature. The request was issued on 31 March 2023, making this its fourth year. Over the past year, the disclosure rate was 94% for the Prime Market and 55% for the Standard Market, while 16% of companies in each market were found to have gone more than one year without an update.
Over the past year, companies that had made disclosures tended to outperform companies that had not disclosed or were still considering their response. Companies that had made an update or their initial disclosure within the past year also tended to outperform companies that had gone more than one year without an update. PBR and ROE showed signs of improvement in both the Prime and Standard markets, with differences in improvement observed by disclosure status.
In the international comparison, 62% of Japanese companies had a PBR of at least 1x and ROE of at least 8%, narrowing the gap with Europe and the United States. In Europe and the United States, however, PBR of at least 2x and ROE of at least 15% were the most common range, while Japanese companies were concentrated in the PBR 1–2x and ROE 8–15% ranges. The analysis also indicated that gaps in return on capital and market valuations remain.
The proposed future policy presented three approaches: helping companies that have already made disclosures to refine and advance their initiatives, supporting companies that have not disclosed in taking the first step, and promoting dialogue with investors. Measures included strengthening feedback to both companies and investors in connection with the revision of the Corporate Governance Code.