Nipponkoa Insurance President Makoto Hyodo breathed a sigh of relief Thursday as shareholders agreed to let him retain his post despite opposition from top shareholder Southeastern Asset Management Inc. of the United States.
Southeastern Asset, which has an 18.28 percent stake in the nonlife insurer, said on its Web site June 9 that it will oppose Hyodo's reappointment at the shareholders' meeting because of the company's poor performance in the past year.
No. 2 shareholder Davis Selected Advisors, a U.S. investment fund with a 5 percent stake in Nipponkoa, also reportedly voiced opposition by voting against the reappointments of Hyodo and nine other board members.
"We will aim to gain stable and continuous profits," Hyodo said at the start of the meeting.
Foreign investors are becoming increasingly frustrated with what they view as sloppy management at Japanese companies. And more are feeling the need to apply pressure by opposing the leaders' reappointment.
At Thursday's meeting, shareholders focused their questions on how Nipponkoa was handling its negotiations with Southeastern Asset, which has drawn unusual attention to the company over the past few weeks.
Hyodo revealed the U.S. investment fund has been urging the firm to separate its investment and insurance divisions and sell its head office.
"It came up during our talks but it was not an official proposal," Hyodo said. "It was still not in a stage where I should discuss it at the board meeting, so I didn't bring it up."
A shareholder who identified himself as Daijiro Kameyama criticized Hyodo for withholding such an important proposal from the board of directors.
Nipponkoa said it has returned some profit to shareholders through share buybacks, which will raise its stock price.