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Did Appointing a Woman to Canon’s board Save CEO Fujio Mitarai Job?
In a notable shift towards gender diversity, Institutional Shareholder Services (ISS) has endorsed the full slate of directors proposed by Canon Inc., including the company’s CEO, following the nomination of the first woman to its board. This move marks a significant change from the previous year when ISS withheld support for the CEO’s reappointment, citing the board’s lack of female representation.
The nomination of Akiko Ito, a former commissioner of Japan’s Consumer Affairs Agency, as an outside director is seen as a progressive step for Canon, which has not had any female board members in its 87-year history. If Ito’s appointment is confirmed at the upcoming general shareholders’ meeting on March 28, it will be a historic moment for the company.
This development comes amidst increasing pressure from institutional investors for Japanese firms to enhance corporate governance and diversify their board composition. ISS has been vocal about its stance, recommending opposition to boards that do not meet certain diversity criteria, including having at least two outside directors and ensuring that external voices constitute at least one-third of the board.
Canon’s decision to nominate ten directors this year, doubling the number from last year and including four external directors, reflects a broader commitment to these governance standards. The reappointment of CEO Fujio Mitarai, along with other key executives, is expected to proceed smoothly at the shareholder meeting, contrasting with the narrow margin of approval he received last year.
The company’s proactive approach in addressing the concerns raised by ISS and its shareholders signifies a potential turning point in the traditionally slow pace of gender diversification in Japanese corporate leadership.
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