The Rules Governing Director Election Contests in Global Activism: A U.S.-Japan Comparative Study

In recent years, the relationship between corporate management and shareholders has grown increasingly confrontational, driven by a surge in shareholder activism. In the U.S., the Securities and Exchange Commission (SEC) has responded with updates to shareholder communication regulations, including the Universal Proxy Rule. Meanwhile, Japan has seen a notable increase in activist campaigns, developing a proxy solicitation framework that was initially inspired by the U.S. system but has since evolved to incorporate unique local practices. This Note examines key distinctions between the U.S. and Japanese approaches to “solicitation” under proxy rules, analyzing regulatory constraints on shareholder and management actions, the role of information disclosure, and mechanisms that facilitate shareholder participation beyond voting rights. By re-evaluating these systems within the context of global corporate governance, this paper provides insights into the influence of shareholder activism on regulatory practices and offers perspectives relevant to emerging activism in jurisdictions beyond the U.S. and Japan.