Abstract/Summary

Responsible investment has grown globally over the last two decades, with a movement from screening strategies towards active ownership. In the UK this development was accelerated by the launch of the Stewardship Code. Not part of the global development, however, is Japan. The Japanese financial market is the only developed financial market globally that did not see a surge in assets under management invested in responsible investment products. In 2014, the Financial Service Authority (FSA) Japan launched the Japanese version of the Stewardship Code, the Principles for Responsible Institutional Investors (PRII) in order to boost responsible investment, focusing especially on active ownership. This thesis analyses the development of responsible investment and stewardship in Japan, with a focus on the question of whether or not stewardship increases accountability. The project is based on semi-structured in-depth interviews with experts in the Japanese market. In 2014, 12 interviews were conducted with investment managers, 11 with investment analysts and 8 with academics, researchers, and consultants. The study finds that several institutional logics are currently competing in the Japanese financial market and that hybrid logics are emerging. One key aspect of a sub-set of these logics is impression management, which occurs in investor-investee meetings. The study finds that trust in the long-term alignment of incentives between investor and investee company is the main determinant for the occurrence of impression management during investor-investee meetings. Consequently, stewardship can either increase accountability and serve as an important corporate governance tool, or create a myth of accountability without any real effect on accountability.