Once-in-a-Generation Shakeup: Market Segments and Well-Governed Firms

once-in-a-generation shakeup: Japan Exchange Group Inc., which owns the bourse, plans to cut the number of market segments, apply new listing criteria and turn five confusing, overlapping divisions into three simpler sections blue-chips, startups and the rest. ; A key goal seemed to have been to overhaul the Topix, whose membership has almost doubled since the 1990s to over 2,000 companies and includes more than half of Japan's listed firms, into a much slimmer benchmark of top-performing, well-governed firms, according to The Japan Times. But some are already voicing concern that the changes may not result in the dramatic transformation that had been hoped for. The Tokyo Stock Exchange is set to undergo a once-in-a-generation shakeup in little over a year. One reason is that Keidanren, Japan's powerful, industry-heavy business lobby, is likely to oppose significant changes to practices that have long made foreign investors skeptical of Japanese stocks such as cross-shareholdings, in which companies with business dealings own stakes in one another. It looks likely that vested interests will water down the process, moving the focus to merely ejecting the small caps rather than corporate governance laggards, Smith said. That's the view of Nicholas Smith, a strategist at CLSA Securities Japan Co., who wrote a report last month titled Opportunity Missed. (news.financializer.com). As reported in the news.