Olympus Scandal and Corporate Governance Reform: Can Japan Find a Middle Ground Between the Board Monitoring Model and Management Model
UCLA UCLA Pacific Basin Law Journal Title The Olympus Scandal and Corporate Governance Reform: Can Japan Find a Middle Ground between the Board Monitoring Model and Management Model Permalink https://escholarship.org/uc/item/9v5803kw Journal UCLA Pacific Basin Law Journal, 30(1) Author Aronson, Bruce E. Publication Date 2012 DOI 10.5070/P8301022242 Peer reviewed eScholarship.org Powered by the California Digital Library University of California THE OLYMPUS SCANDAL AND CORPORATE GOVERNANCE REFORM: CAN JAPAN FIND A MIDDLE GROUND BETWEEN THE BOARD MONITORING MODEL AND MANAGEMENT MODEL? By Bruce E. Aronson* TABLE OF CONTENTS I. Introduction ................................. 95 II. The Olympus Scandal and Corporate Governance Issues ..................................... 106 A. Background of the Olympus Case ............ 106 B. Monitoring of Management under Japan's Corporate Governance System .............. 115 III. Back to Basics: Revisiting Theoretical and Structural Issues ............................ 120 A. Purpose of Corporate Governance Reform .... 120 B. Monitoring Function of the Board of Directors..... ........................ 125 IV. Practical Issues: Achieving "Truly Effective" Corporate Governance Reform ................. 129 A. Information ............................. 130 1. Internal Sharing of Information .......... 130 2. Public Information Disclosure ............ 132 * Senior Fulbright Research Scholar, Waseda University; Professor of Law, Creighton University School of Law. I thank Mr. Sumitaka Fujita, Professor Yumiko Miwa, and Mr. Naoaki Okabe for acting as a panel of commentators following my presentation on this research at the Meiji Institute for Global Affairs Inaugural Symposium, Tokyo, Japan (Feb. 21, 2012), and participants in presentations at Nagoya University (April 20, 2012), AIMA Japan Hedge Fund Forum 2012, Tokyo Stock Exchange (June 4, 2012), 2012 International Conference on Law & Society, Law & Society Association, Honolulu (June 5, 2012), and Business Research Institute, Tokyo (Aug.
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