Companies Act reform: Review of the Three-Committee System [Feb ’25]

On 10 February 2025, the Minister of Justice requested that the Legislative Council review the Three-Committee System, which is one of the governance structures that Japanese companies can adopt under the Companies Act.

This system was introduced in 2002 with the intention to give companies the choice to adopt a US/UK-style nomination, remuneration and audit committee system. However, it has not gained popularity, with fewer than 3% of TSE-listed companies adopting this structure.

 Three-Committee System explained in: Governance Structures