The state-backed Innovation Network Corporation of Japan investment fund will turn itself into a holding company to strengthen governance and boost investment in promising startup firms, a draft plan showed Thursday.
The INCJ has been criticized for an excessive emphasis on rescuing financially struggling companies rather than fostering industries with growth potential and global competitiveness.
The new holding company would check the performance of investment units under its umbrella, and improve their discipline and transparency, according to the draft obtained by Kyodo News.
The government set up an advisory panel in October to draw up a reform plan for the Tokyo-based investment fund. It now plans to submit a bill to revise the Act on Strengthening Industrial Competitiveness, which defines the role of the INCJ, to the regular Diet session next year to realize the structural change.
The fund's operation would also be extended beyond fiscal 2024, the current deadline for winding it up, through fiscal 2033, the draft states.
The government is also considering changing the name of the INCJ and integrating a number of state-backed investment funds into it, with the holding company overseeing the merged funds.
The INCJ, established in 2009, helped the turnaround efforts of microchip maker Renesas Electronics Corp. Its support for liquid crystal display maker Japan Display Inc. has been widely viewed as unsuccessful.