New Governance Guidelines for Unlisted Companies Released by Japan's Corporate Governance Committee
On December 5, 2025, Management Solutions Inc. (MSOL), headquartered in Minato, Tokyo, announced the publication of the 'Corporate Governance Guidelines for Unlisted Companies.' This initiative is spearheaded by Shinya Takahashi, the Chairman of the Board and head of the Japan Corporate Directors Association's committee focusing on unlisted companies. With about 1.78 million corporate entities in Japan, only around 0.22% are listed companies. This indicates that the vast majority of unlisted enterprises play a vital role in supporting the local economy and employment. However, unlike listed companies, unlisted entities are not necessarily subject to governance codes or required to appoint outside directors, which can lead to governance issues, such as dependence on individual entrepreneurs’ discretion and weaknesses in systematic decision-making and risk management.
The newly released publication aims to address these challenges by systematically organizing corporate governance concepts suitable for unlisted companies. It provides practical guidance to facilitate sustainable growth and enhance corporate value, emphasizing that governance should not merely be viewed as control or restrictions but as a foundation that improves management quality and supports business growth.
1. Categorizing Unlisted Companies
The guidelines categorize unlisted companies into three types, analyzing their characteristics and the challenges they face:
- Startup Companies: Focused on rapid growth and aiming for an exit within a short timeframe.
- Showa-style Companies: These are primarily owner-operated businesses that serve as mid-sized or small enterprises within large corporations' supply chains.
- Large Unlisted Enterprises: Intentionally remaining unlisted, these companies are of considerable size.
2. Enhanced Governance Direction by Category
Practical governance recommendations are tailored for each type. For startups, a 'Minimum Corporate Governance Checklist' is provided to ensure transparency by instituting board meetings, minute-taking, and authority regulations from the early stages of operation. Showa-style companies are encouraged to move away from isolated operations by incorporating external advisors and professionals in board meetings. Meanwhile, large unlisted firms can introduce measures such as authority regulations and advisory boards to maintain a balance against the concentration of power among founding families.
3. Common Perspectives and Institutional Promotion
Across different categories, the guidelines emphasize the importance of:
- Viewing a company as a 'public entity' rather than a private possession.
- Designing functional systems that go beyond mere formalities.
- Balancing governance reforms with respect for the founding ideals and corporate culture.
Furthermore, it is suggested that business succession should be seen as an opportunity for governance reform, advocating tax incentives and collaboration with local financial institutions and experts to establish a supportive ecosystem for dissemination.
This framework is anticipated to assist unlisted companies in improving corporate value and achieving sustainable growth.
The 'Corporate Governance Guidelines for Unlisted Companies' can be accessed in full through the Japan Corporate Directors Association's website: JACD Guidelines
Shinya Takahashi is the Chairman of the Board of MSOL and has an extensive background in consulting and management. After graduating from university, he joined Andersen Consulting (now Accenture), working on operational design and system development. He later worked at Capgemini, focusing on management and performance consulting, and served as the PMO leader for a global system development project at Sony Global Solutions. He founded Management Solutions in 2005 and took office as the Chairman of the Board in January 2024, also leading the committee focused on unlisted company governance at the Japan Corporate Directors Association.
As a company specializing in management, MSOL leverages its extensive experience and knowledge to support various projects across organizations, enabling them to achieve success. The company aims to serve as a platform for societal impact through the fusion of people and technology in management, fostering organizational transformation, value creation, and individual growth. It was established in July 2005, is headquartered in Akasaka, Tokyo, and is led by CEO Hiroshi Kaneko.
For further inquiries:
Management Solutions Inc.
Prime TSE: 7033
PM Business Headquarters
〒107-6229 Tokyo, Minato-ku, Akasaka 9-7-1, Midtown Tower 29F
TEL: 03-5413-8808
Email: [email protected]
The newly released publication aims to address these challenges by systematically organizing corporate governance concepts suitable for unlisted companies. It provides practical guidance to facilitate sustainable growth and enhance corporate value, emphasizing that governance should not merely be viewed as control or restrictions but as a foundation that improves management quality and supports business growth.
Key Points of the Guidelines
1. Categorizing Unlisted Companies
The guidelines categorize unlisted companies into three types, analyzing their characteristics and the challenges they face:
- Startup Companies: Focused on rapid growth and aiming for an exit within a short timeframe.
- Showa-style Companies: These are primarily owner-operated businesses that serve as mid-sized or small enterprises within large corporations' supply chains.
- Large Unlisted Enterprises: Intentionally remaining unlisted, these companies are of considerable size.
2. Enhanced Governance Direction by Category
Practical governance recommendations are tailored for each type. For startups, a 'Minimum Corporate Governance Checklist' is provided to ensure transparency by instituting board meetings, minute-taking, and authority regulations from the early stages of operation. Showa-style companies are encouraged to move away from isolated operations by incorporating external advisors and professionals in board meetings. Meanwhile, large unlisted firms can introduce measures such as authority regulations and advisory boards to maintain a balance against the concentration of power among founding families.
3. Common Perspectives and Institutional Promotion
Across different categories, the guidelines emphasize the importance of:
- Viewing a company as a 'public entity' rather than a private possession.
- Designing functional systems that go beyond mere formalities.
- Balancing governance reforms with respect for the founding ideals and corporate culture.
Furthermore, it is suggested that business succession should be seen as an opportunity for governance reform, advocating tax incentives and collaboration with local financial institutions and experts to establish a supportive ecosystem for dissemination.
This framework is anticipated to assist unlisted companies in improving corporate value and achieving sustainable growth.
About the Guidelines
The 'Corporate Governance Guidelines for Unlisted Companies' can be accessed in full through the Japan Corporate Directors Association's website: JACD Guidelines
Profile of Shinya Takahashi, Chairman of the Committee
Shinya Takahashi is the Chairman of the Board of MSOL and has an extensive background in consulting and management. After graduating from university, he joined Andersen Consulting (now Accenture), working on operational design and system development. He later worked at Capgemini, focusing on management and performance consulting, and served as the PMO leader for a global system development project at Sony Global Solutions. He founded Management Solutions in 2005 and took office as the Chairman of the Board in January 2024, also leading the committee focused on unlisted company governance at the Japan Corporate Directors Association.
About Management Solutions Inc.
As a company specializing in management, MSOL leverages its extensive experience and knowledge to support various projects across organizations, enabling them to achieve success. The company aims to serve as a platform for societal impact through the fusion of people and technology in management, fostering organizational transformation, value creation, and individual growth. It was established in July 2005, is headquartered in Akasaka, Tokyo, and is led by CEO Hiroshi Kaneko.
For further inquiries:
Management Solutions Inc.
Prime TSE: 7033
PM Business Headquarters
〒107-6229 Tokyo, Minato-ku, Akasaka 9-7-1, Midtown Tower 29F
TEL: 03-5413-8808
Email: [email protected]
Topics Business Technology）
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