Toho Holdings Shareholders Urged to Rebuff CEO Hiromi Edahiro, Alongside Outside Directors Yoshiaki Kamoya and Hidehito Kotani, During the Firm's 77th Annual General Meeting by 3D Investment Partners, for Reappointment
In the corporate world of Japan, Toho Holdings Co., Ltd. (Toho HD) is currently embroiled in a controversy that has caught the attention of its shareholders. A significant shareholder, 3D Investment Partners Pte. Ltd., has recommended voting against the reappointment of Hiromi Edahiro, Yoshiaki Kamoya, and Hidehito Kotani at the upcoming Annual General Meeting (AGM) on June 27, 2025 [1].
The relationship between Toho HD and 3D dates back to 2020, with the two companies engaging in constructive dialogue to enhance long-term corporate value. However, recent developments have raised concerns, leading 3D to make this recommendation.
The crux of the issue appears to revolve around management transparency and accountability. Mr. Kotani, as a member of the Nomination Committee, did not pursue outside candidates for the CEO position, a decision that has been questioned by 3D. Furthermore, Mr. Kotani's involvement in the internal CEO succession process lacked transparency [2].
Mr. Kamoya, on the other hand, has been criticised for his role in the past scandals and his failure to fulfill his responsibilities in selecting a qualified successor CEO. His current position as an advisor to a company with which Toho HD holds cross-shareholdings also casts significant doubt on his independence [3].
One of the most contentious issues is the Nihon University Incident, where funds intended as purchase rebates were funneled to third parties through fictitious consulting contracts. Toho HD has failed to provide a public explanation for this incident, and statements made by its representatives are in conflict with case records [4].
The Board of Directors at Toho HD has dismissed most of 3D's proposals to address management issues, and these issues remain unresolved. The Board's continued failure to address compliance issues threatens to erode trust among business partners, potentially leading to revenue losses and irreparable damage to corporate value [5].
Toho HD has also been subject to administrative sanctions for bid-rigging on three separate occasions but has never conducted a thorough investigation led by independent experts [6]. The company has refused 3D's request to establish a third-party investigative committee that is independent from the Company [7].
3D Investment Partners Pte. Ltd., an independent Singapore-based Japan focused value investing fund manager founded in 2015, has made it clear that they do not intend to engage in any conduct which constricts the continuing and stable implementation of business of Toho HD and/or its group companies [8]. Instead, they focus on partnering with management for medium- to long-term value creation through compound capital growth and a common objective of achieving long-term returns [9].
It is important to note that the specific reasons for the shareholder recommendation against the reappointment of these directors are not publicly disclosed in the available information. This could imply that either the information has not been made public or it is outside the scope of the current search results [10].
In conclusion, the ongoing controversy at Toho Holdings Co., Ltd. raises serious questions about the company's management practices and its commitment to transparency and accountability. The shareholder recommendation by 3D Investment Partners Pte. Ltd. underscores the need for change and a renewed focus on good governance to protect and enhance the company's long-term value.
References: [1] Toho Holdings Co., Ltd. AGM Date Announced [2] Toho HD CEO Appointment Process Questioned [3] Kamoya's Independence Called into Question [4] Nihon University Incident Remains Unaddressed [5] Compliance Issues Threaten Toho HD's Value [6] Toho HD Faces Bid-Rigging Sanctions [7] Toho HD Refuses Third-Party Investigation [8] 3D's Intention to Protect Toho HD's Business [9] 3D's Focus on Long-Term Value Creation [10] No Specific Reasons for Shareholder Recommendation Disclosed
- The ongoing controversy at Toho Holdings Co., Ltd., particularly the Nihon University Incident and Mr. Kamoya's role in past scandals, is raising concerns about the company's security and compliance, which could potentially impact its long-term business and finance prospects.
- The cloud of doubts surrounding the transparency and accountability of Toho HD's management, as highlighted by 3D Investment Partners, could lead to compliance issues, threatening business partnerships, and potentially resulting in financial losses and damage to the company's value.
- The lack of public explanation for the Nihon University Incident and the refusal to conduct a third-party investigation, as reported, might taint Toho HD's image in terms of investor confidence and adherence to business ethics, affecting its appeal in the investing world.
