Online Shareholder Meetings in Japan

The Covid-19 pandemic forced to change the way Shareholder meetings are conducted in Japan. Many shareholders who were afraid of getting infected hesitated to attend, as a result, it become difficult to hold a regular shareholder meeting in fact. The Japanese Corporate Act provides that a stock company has to decide “a place” to hold its shareholders meeting in the notice of the meeting, so the stock company has to prepare the place for “the real meeting.”

To deal with this problem, Japanese government enacted a new law, the industrial competition empowerment Act, in 2021, which allowed the Japanese companies who got a permission from the government to hold the shareholder meeting without mentioning the place provided that they changed their articles. Under the online shareholder meeting, shareholders put their questions into the web site that was specially prepared, and the chairperson read it, then a company’s president answer to it through a video camera. Shareholder’s vote is also conducted by the Internet.

The online shareholder meeting has a big possibility in the point that the attendants don’t have to worry about getting infected and also shareholders who lived in far distance can get opportunity to attend it. On the other hand, however, it was pointed out that the online meetings have some problems that the risk of disconnection, company may knowingly except questions it disliked, and unfair disguising shareholder. It could be serious problem especially in an important shareholder’s decision such as the articles change and the restructuring. It is required for the companies who use the online shareholder meeting not only to receive the merit but also to stand sincerely to the shareholders and to install a good online system.

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