The introduction in October of the much-touted U.S. 401(k)-style corporate pension system in Japan will have little impact until individual investors feel more confident about the regulatory environment and the economy, said Brian Murdoch, president and CEO of Merrill Lynch Investment Managers.

"It's a step. . . . Nothing will happen without this legislation," said Murdoch, who heads the asset-management branch of Merrill Lynch Securities Co. Japan. "This is not going to be an overnight change."

The Diet enacted the law to introduce the new pension system, paving the way for its launch this fall. The next and more daunting step is to improve the rights of shareholders and the transparency of Japanese firms, he said.