Summary of June 2025 annual general shareholder meeting season shareholder proposals

• The number of shareholder proposals during the June 2025 general meeting season reached a new record high.
• Director appointments by shareholders drew particular attention among governance-focused proposals.
• 40 out of the 146 proposals submitted by activist funds at the June 2025 shareholder meetings received support of 30% or more.

Sustained high level of Shareholder Proposals for the June 2025 general meeting season

According to the news reports, during the June 2025 annual general meeting season, shareholders made a total of 399 proposals to 114 Japanese publicly listed companies. This marks the fourth consecutive year of record-breaking numbers. According to our calculations, among the companies that received proposals, a total of 146 proposals were submitted by institutional investors including activists. Shareholder proposals from activists in Japan have traditionally focused on balance sheet-related issues, such as demands for dividend payouts or other improvements to the company's financial structure. However, in recent years, there has been an increase in governance-related proposals, such as seeking changes in board composition or director appointments, and strategic proposals, such as calls for delisting or withdrawal from unprofitable businesses that affect core management strategy. At this year's June annual general meetings, several noteworthy cases emerged involving governance-related shareholder proposals submitted by activist investors.

View full image: Activist investor proposals by category (2025) (PDF)

Management overhaul at Tokyo Cosmos Electric through proposal by Global ESG Strategy

At the 68th Annual General Meeting of Tokyo Cosmos Electric Co., Ltd. held on June 24, 2025, two shareholders—Global ESG Strategy and Seisei Co., Ltd.—submitted proposals to appoint a total of eight directors (excluding directors who serve as Audit and Supervisory Committee members). Global ESG Strategy proposed five candidates, including the Chief Investment Officer of Swiss-Asia Financial Services Pte. Ltd., the fund's manager at the time of the proposal,¹ while Seisei proposed three candidates. Although Tokyo Cosmos Electric opposed both shareholder proposals, all eight candidates were elected, while the company's own proposals to appoint five directors (four incumbents and one new candidate) were rejected, resulting in the company's entire management team being replaced.

The support rates for Tokyo Cosmos Electric's proposed directors ranged from 47.98% to 48.45%, with the lowest being for Yoshiki Iwasaki, the incumbent President and Representative Director, who received 47.98%. In contrast, all five candidates proposed by Global ESG Strategy received 52.62% support, and the three candidates proposed by Seisei received 52.29% support.²

According to large shareholding reports submitted just before the record date of March 31, 2025, Global ESG Strategy held 19.82%³ of the company's shares, and Seisei held 12.98%,⁴ which shows that both shareholder proposals gained significant support from shareholders beyond the proposing entities themselves.

Dalton's proposal to appoint its own Chief Investment Officer (CIO) as an outside director at Hogy Medical succeeded

At the 64th Annual General Meeting of Hogy Medical Co., Ltd., held on June 20, 2025, NIPPON ACTIVE VALUE FUND PLC submitted a proposal along with its joint-holders, Dalton Investments, Inc., and NAVF Select LLC, seeking the appointment of three directors (excluding directors who serve as Audit and Supervisory Committee members) including James B. Rosenwald III, the CIO of Dalton. Despite opposition from Hogy Medical, the proposal to appoint Mr. Rosenwald as a director was approved with 52.1% support. The company had also proposed the appointment of two directors, both of which were approved.⁵

According to a large shareholding report submitted by NIPPON ACTIVE VALUE FUND just before the record date of March 31, 2025, the combined shareholding ratio (including joint holders) was 25.03%,⁶ indicating that the proposal to appoint Mr. Rosenwald received significant support from shareholders beyond the proposing entities.

While shareholder proposals often seek to appoint independent third parties as outside directors, this case—where a shareholder's executive is directly appointed to the board by a contested vote—is a less-common but sometimes seen phenomenon.

Taiyo Holdings' proposal to reappoint its president was voted down despite its strong business performance

At the 79th Annual General Meeting of Taiyo Holdings Co., Ltd., held on June 21, 2025, a fund managed by Oasis Management Co. Ltd ("Oasis") submitted a shareholder proposal to dismiss President and Representative Director Eiji Sato while the company proposed his re-appointment.

Oasis argued that the medical and pharmaceutical business, which the company began expanding in earnest in 2018 under Mr. Sato's leadership, had resulted in low returns despite significant investment, thereby damaging corporate value. Oasis also criticized the third-party allotment of shares conducted in 2017 as part of a capital and business alliance with DIC Corporation.⁷

The company disclosed receipt of the shareholder proposal on May 8,⁸ and on May 16, it announced the board's opposition.⁹ However, on June 3, DIC—Taiyo Holdings' largest shareholder and strategic partner—issued a statement titled "Notice Regarding Our Voting Intentions for Director Appointment Proposal (Proposal No. 2) at Taiyo Holdings' 79th Annual General Meeting," declaring its intention to vote against Mr. Sato's reappointment.¹⁰ It is highly unusual for a business partner to publicly oppose the reappointment of the sitting president before the AGM in response to an activist campaign.

The company's proposal to reappoint Mr. Sato received only 46.09% support, falling short of the required 50% and was rejected. Although Oasis's proposal to dismiss Mr. Sato was also rejected, it received 49.90% support, coming very close to being approved as well.¹¹ It was reported that DIC, which held 20.04% of shares as stated in the meeting notice, and Oasis, which held 10.57% as of March 25, 2025,¹² were joined by members of the founding family in opposing the proposal to re-appoint Mr. Sato.¹³ Notably, the outcome of the shareholder proposal could not be determined based on voting results prior to the day of the meeting. Therefore, shareholders attending the AGM cast their votes in person. At Japanese shareholder meetings, if the company determines that the requirements for passing or rejecting a resolution have been met based on the votes cast up to the day before the meeting, and the resolution is deemed legally valid under the Companies Act, shareholders present may exercise their right to vote through applause or similar means. In such cases, the company may choose not to count the number of votes from attending shareholders whose positions (for, against or abstention) cannot be confirmed as part of the resolution's outcome.

As a result of the vote, Mr. Sato was removed from his roles as President, Representative Director and CEO (as well as board member). The board appointed him as Senior Executive Officer, and he will continue to serve as CEO of the Medical and Pharmaceutical Division. This was described as a temporary measure to minimize disruption to the business, with a final decision to be made by the board of directors.¹⁴

Although the removal proposal itself was rejected, this will likely be seen as a catalyst for shareholders to reassess the company's governance structure.

Shareholder proposals by activist funds at the June 2025 shareholder general meetings which received over 30% support¹⁵

According to our calculations, out of the 146 shareholder proposals submitted by activist investors at the June 2025 shareholder meetings, 40 proposals received support of 30% or more as below.

Jonathon Jackson (White & Case, Law Clerk, Tokyo) contributed to the development of this publication.

_{1 As of July 15, 2025, Axium Capital Pte. Ltd. has been acting as the discretionary investment manager (Axium Capital Pte. Ltd. "Large Shareholding Report" (filed July 22, 2025)).
2 Tokyo Cosmos Electric Co., Ltd. "Extraordinary Report," June 25, 2025).
3 Swiss-Asia Financial Services Pte. Ltd. "Large Shareholding Report," submitted on March 27, 2025.
4 Seisei Co., Ltd. "Large Shareholding Report," submitted on February 12, 2025.
5 Hogy Medical Co., Ltd. "Extraordinary Report," June 23, 2025.
6 NIPPON ACTIVE VALUE FUND PLC "Amendment Report No. 18," submitted on February 7, 2025.
7 Taiyo Holdings Co., Ltd. Notice of the 79th Annual General Meeting of Shareholders.
8 Taiyo Holdings Co., Ltd. "Notice of Receipt of Written Shareholder Proposal," May 8, 2025.
9 Taiyo Holdings Co., Ltd. "Notice Regarding the Board of Directors' Opinion on the Shareholder Proposal," dated May 16, 2025.
10 DIC Corporation "Notice Regarding the Exercise of Voting Rights on Proposal No. 2 (Election of Directors) at the 79th Annual General Meeting of Shareholders of Taiyo Holdings Co., Ltd.," June 3, 2025.
11 Taiyo Holdings Co., Ltd. "Extraordinary Report," June 23, 2025.
12 Oasis Management Company Ltd. "Amendment Report No. 1," submitted on April 1, 2025.
13 Nikkei Newspaper, Morning Edition, June 22, 2025.
14 Taiyo Holdings Co., Ltd. "Initiatives to Enhance Corporate Value and Secure Joint Interests of Shareholders Following Transition to New Management Structure," July 1, 2025.
15 All numerical data were calculated by White & Case LLP based on search results from XeBRal ADDS and other publicly}

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