Individual and institutional investors were assertive at shareholders’ meetings held by many companies in late June, raising questions about low stock prices and directors’ retirement allowances.

This is a far cry from several years ago when shareholders were silent and used to give companies carte blanche at shareholders’ meetings.

More than 1,000 companies held their annual meetings June 27.

At one of them, the management of NTT Corp. came under severe criticism from shareholders over its first decline in revenue.

“I suffered a tremendous loss due to the sluggish price of NTT shares,” one shareholder charged. “What is the company going to do about it?”

About 1,650 shareholders attended the NTT meeting, 300 more than last year.

Apparently reflecting their growing concern over a sharp decline in business performance, the number of shareholders who raised questions at the meeting increased to 12, up from four last year.

The company described its management policy only in broad terms, saying it would focus on areas related to broadband.

A representative of an institutional investor who cast a blank vote on the company’s profit appropriation proposal said he was dissatisfied with NTT’s tepid explanation.

“It showed no great enthusiasm for doing something to shore up the stock price,” he said.

The moribund state of the stock market appears to have woken up the “sleeping investors.”

Nippon Life Insurance Co., which holds stocks of nearly 2,000 listed companies, added “stock buyback” to the questions it would have its representatives ask at the shareholders’ meetings of some of those companies.

The nation’s largest life insurer picked out about 50 companies, including Hitachi Ltd., that have surplus funds but are reluctant to purchase their own shares, and asked for an explanation of their policy on share buybacks.

“With the investment environment deteriorating more than ever before, we can no longer sit still and watch how companies deal with the problem of bolstering their share prices,” said Hiroshi Ishimura, stock department director at Nippon Life Insurance.

Though Nippon Life did not vote against any of the proposals made by Hitachi at the shareholders’ meeting, it remains tough. “We will take a strong line, depending on Hitachi’s future action,” Ishimura said.

Some institutional investors took tougher stances.

The Employees’ Pension Fund Association, which has 5.4 trillion yen in assets under its management, voted against 40 percent of the 7,035 proposals brought up for discussion at this year’s meetings.

Nomura Asset Management Co., the nation’s largest investment trust, analyzed proposals made by nearly 1,000 companies and cast ballots against some of them, citing antisocial aspects or insufficient openness.

The number of proposals voted against by Nomura Asset Management this year increased by 20 percent to 30 percent from last year.

According to Hiroshi Suzuki of the Daiwa Research Institute, behind these tougher stances lies institutional investors’ fear that they might “be viewed with suspicion unless they show to annuity holders convincing evidence that they took proper actions as an institutional investor.”

The shareholders’ meeting of Sony Corp. held June 20 was the company’s largest ever, drawing 6,257 shareholders, mostly middle-aged and elderly individual investors. Total attendance was up 43 percent from the year before.

Some shareholders demanded that the company disclose directors’ remunerations and reduce its planned 1.6 billion yen retirement allowance for Norio Ohga, Sony’s former president and chairman, to about 100 million yen.

Though the shareholders’ proposals were voted down, they gained support from 30.1 percent of those with voting rights.

A new aspect of shareholders’ meetings is voting over the Internet, which has increased the number of individuals who exercise their voting rights.

In the case of Sony, 11,000 cast their ballots online this year, up 50 percent from the previous year.

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