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26 November 2025

Market Musings - Quiet shifts, lasting impact

Corporate governance in Japan has been evolving for years, but the pace of change is accelerating. Engagement is delivering tangible results. We observe companies introducing share buybacks, setting clearer return targets and refreshing boards. As illustrated in Figure 1, these actions reflect a cultural and regulatory push towards better capital discipline and more shareholder-aware decision-making. Recent policy shifts in Japan reflect a broader move towards more active capital discipline, reinforcing the momentum behind governance reform.

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Author

Jan Willem Berghuis

j.berghuis@vanlanschotkempen.com

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Disclaimer
Van Lanschot Kempen Investment Management NV (‘VLK Investment Management’) is licensed as a manager of various UCITS and AIFs and authorised to provide investment services and as such is subject to supervision by the Netherlands Authority for the Financial Markets. This document is for information purposes only and provides insufficient information for an investment decision. This document does not contain investment advice, investment recommendation, research, or an invitation to buy or sell any financial instruments, and should not be interpreted as such. The opinions expressed in this document are our opinions and views as of the date of publication only. These may be subject to change at any time, without prior notice.

Small-cap equities: general risks to take into account when investing in small-cap equity strategies.
Please note that all investments are subject to market fluctuations. Investing in a small-cap equity strategy may be subject to country risk and equity market risks, which could negatively affect performance. Under unusual market conditions, these specific risks can increase significantly. Potential investors should be aware that changes in the actual and perceived fundamentals of a company may result in changes to the market value of the shares of such company. Equities of companies with small capitalisation can be more volatile than equities of mid and large companies and may also be less liquid. The value of your investment may fluctuate. Past performance is no guarantee of future results. Do not take unnecessary risks. Before you invest, it is important that you are aware of and are informed about the characteristics and risks of investing. This information can be found in the available documents of the strategy and/or in the agreements that are part of the service you choose or have chosen.

There’s a saying in Dutch, Kom verder, it means many things and it’s our business philosophy. It captures the way we work with clients but also the way we steer our investee companies to deliver shareholder value through active engagement.

Capital at risk. The value of investments and the income from them can fall as well as rise, and investors may not get back the amount originally invested. Past performance provides no guarantee for the future.