Japan: Boosting Capital Efficiency

The issue of improving corporate governance has been on the radar in Japan for the past decade but following the Tokyo Stock Exchange’s recent push for companies to design and provide capital improvement plans, the pace of change is accelerating. Chris Smith, Co-manager of the Polar Capital Japan Value Fund, explores how excess capital is being put to use through increased dividends and internal investment, as well as addressing the possible implications of these reforms on Japanese equities and why he believes value investors are best placed to benefit.