Around 2,020 firms held shareholders’ meetings nationwide Thursday, with scandal-ridden companies claiming most of the limelight.
The meetings were for listed and unlisted firms whose 2001 business year ended on March 31.
At companies embroiled in scandals, the meetings began with top management making apologies. These included Snow Brand Milk Products Co., whose now-disbanded subsidiary Snow Brand Foods Co. was found to have deliberately mislabeled beef.
Snow Brand President Kohei Nishi faced about 600 shareholders and apologized for the problems that have plagued his firm, beginning with a mass food poisoning outbreak the company’s dairy products triggered two years ago. The media were able to view the proceedings via monitors in a separate room.
“The disbanding of Snow Brand Foods was a difficult decision to make, but we determined that it was necessary to win back public trust,” he said. The company sought shareholder acceptance of a new restructuring plan, which calls for spinning off its mainstay dairy business.
Some shareholders questioned whether Snow Brand had a system to check the operations of its subsidiaries, while others asked how the distribution of debt burdens stemming from the disbanding were decided.
Other firms that held meetings included the engineering firm JGC Corp. and construction consultancy Nippon Koei Co., both of which are embroiled in a scandal involving Diet lawmaker Muneo Suzuki, who is now under arrest for suspected bribery.
The management of Sasebo Heavy Industries Co., which is under investigation for suspected fraud related to government subsidies, also apologized to shareholders.
Sasebo Heavy President Arifumi Himeno tendered his resignation at the meeting, and shareholders accepted it.
The tradition of thousands of companies holding shareholders’ meetings on the same day in June was adopted in an effort to prevent “sokaiya” corporate racketeers from extorting money from companies by threatening to disrupt their meetings.
According to the Tokyo Stock Exchange, of the number of firms whose business years end March 31, a record 96.2 percent held their shareholders’ meetings on the same day in June in 1995.
The proportion has gradually fallen, and marked 76.5 percent this year.
According to the National Police Agency, the number of sokaiya has risen slightly from last year to around 430. While they have been relatively quiet in recent years, some appeared at shareholders’ meetings in March, and there are signs they are becoming more active, police said.
There are fewer cases of sokaiya disrupting meetings by making lengthy speeches or taking turns in making endless comments, but they are adopting tactics such as asking for compensation for losses incurred in stock price declines, according to police.
Around 6,000 police officers were deployed nationwide at the request of almost 1,900 firms to keep a watch on the meetings. In Tokyo, around 2,200 police officers were sent to the meetings of 860 companies.
Shareholders’ meetings are usually rituals that end in about 20 minutes with no significant questions being raised by shareholders, but this is gradually changing as shareholders demand more information.
A survey showed that such meetings for firms listed on the first and second sections of the stock exchanges lasted an average of 39 minutes in 2001, compared with 26 minutes in 1996.
While the salaries of executives have generally been an off-limit subject, a few companies have revealed data, with Hitachi Ltd. disclosing the monthly wages of its executives. and Toshiba Corp. revealing the level of bonus pay for retiring executives.
Some companies, including Sony Corp., NEC Corp. and NTT DoCoMo Inc., have introduced voting for shareholders via the Internet, a system made possible under a revision to the Commercial Code in April.
Only about 2 percent of shareholders chose to vote online, but the number is expected to rise in the future, particularly among individual shareholders.
West Japan Railway Co. gave its shareholders ID numbers and a password that enabled them to view proceedings over the Internet.