Toyota’s annual general meeting on Tuesday saw the re-election of Chairman Akio Toyoda and nine other board members, despite concerns from proxy advisers and some shareholders about governance and certification test scandals.
Toyoda’s re-appointment was widely expected due to his popularity among Japanese retail investors and the significant shareholdings in the automaker owned by other Toyota group firms. Additionally, the company’s record business results and strong stock performance last year worked in his favor.
However, Toyoda’s approval rating fell to 85% last year, down from 96% in 2022. Any significant drop in shareholder support could lead to further action on governance reforms, including the unwinding of cross-shareholdings.
Proxy advisers Institutional Shareholder Services (ISS) and Glass Lewis had recommended against Toyoda’s re-election, cited concerns about the board’s lack of independence, strategic shareholdings, and return on equity. New York City’s public employee pension funds also voted against Toyoda, stating that “setting a tone at the top is critical.”
Despite this, Toyoda remained popular among retail investors, who account for 12.6% of the automaker’s shareholders. An 84-year-old shareholder, Hidenori Takahashi, expressed his support for Toyoda, calling Toyota the “best company in Japan” for shareholders.
The final tally of shareholder support for Toyoda would be released on Wednesday, and any significant opposition is expected to come from overseas investors, who accounted for a quarter of Toyota’s shareholders.
Boluwatife Enome
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