INSTITUTIONAL INVESTORS,CORPORATE GOVERNANCE AND FIRM PERFORMANCE IN JAPAN

Since the beginning of the 2000s, institutional investors in Japan have become active in strengthening corporate governance, with the aim of achieving long‐term corporate value. The present paper examines the relationship between institutional investors and corporate governance, and also the relationship between institutional investors' shareholdings and firm performance. The results suggest that corporate governance has been enhanced by institutional investors. However, it is found that there is not a statistically significant difference between institutional investors' shareholdings and firm performance.