In the latest of our Travel Diary series, Global Listed Infrastructure Analyst Jessica Johnson explores the changing engagement and corporate governance of Japanese companies.
The latest Travel Diary from our Global Listed Infrastructure team comes from Analyst, Jessica Johnson. Following a recent trip to Japan, she discusses the countries changing corporate governance, investor engagement and infrastructure trends.
The key highlights of the trip were:
- Japan is open to improving corporate governance. There was noticeable change in engagement with investors, including discussions on diversity – particularly women in the boardroom – and incentives linked to financial performance.
- Japan is starting to deliver some volume expansion. Port volumes turned positive for the first time in two years. Rail and airport volumes are robust and will receive a boost from the 2019 Rugby World Cup and 2020 Olympics. Sentiment is lifting and domestic companies are expanding their operations.
- Identifying mispricing across the globe is one of the advantages of sector coverage within our team. Japanese gas utilities remain unloved with low expectations reflecting impending market deregulation – risks are to the upside. In contrast, the Chinese gas utilities are still a consensus buy and the risk of regulatory intervention is being downplayed.