Below are key takeaways from ISS’ recently released 2025 Japan Proxy Season Preview. The full report is available to institutional subscribers by logging into ProxyExchange then selecting the Knowledge Center and its Library tab and to corporate subscribers by logging into Compass then selecting Governance and the Governance Library or Governance Exchange tab.
- Peak meeting date: This year’s peak Japan meeting day is once again expected to be June 27, when about a quarter of June annual meetings are likely to be held on a single day, followed by June 26, June 25, and June 24.
- Board Independence: The number of outside directors at Japanese companies had increased in recent years, and most companies are now in compliance with the Japan Corporate Governance Code requirements. As of March 2025, 87 percent of companies covered by ISS had a board composed of at least one third outsiders. In addition, at 46 percent of companies, at least half of the board members were outsiders.
- Board Gender Diversity: A continued uptick in female board representation is observed. As of March 2025, 77 percent of companies ISS covered had at least one female director (an increase from 74 percent a year earlier). Moreover, the number of companies with at least two female directors has jumped from 26 percent last year to 36 percent this year.
- Equity Compensation Plans: More equity compensation plans are expected to be seen on ballots this year. An increasing number of Japanese companies are continuing to propose performance-based and equity-based compensation to better align the interests of executives with those of shareholders, a trend partially driven by Japan’s Corporate Governance Code.
- ISS Japan Policy Changes: ISS has introduced a new director independence criteria for Japan, under which individuals who have served on the board for 12 years or more will not be considered independent. However, the policy update won’t be implemented until February 2026. This one-year transition period is intended to give companies sufficient time and awareness to recruit qualified candidates, if they wish to.
If you are not a subscriber, please contact sales@iss-stoxx.com (for institutional investors) or contactus@isscorporatesolutions.com (for corporations) to learn more about accessing bespoke governance research.
By:
Japan Research Team
