ISS and other proxy advisory firms' influence has been growing in recent years. ISS's recent recommendation to vote in favor of a shareholder proposal at Kuroda Electric's high-profile general shareholder meeting apparently influenced many shareholders' votes. Authorities should consider regulating proxy advisory firms to ensure the adequacy of their controls to prevent conflicts of interest and arbitrary or misinformed recommendations.

While Japanese banks' fund holdings are growing, meeting banks' regulatorily mandated informational requirements imposes a heavy burden on asset management companies. The asset management industry as a whole should develop uniform risk-weighting standards and standardize report forms in anticipation of prospective regulatory tightening and to better serve its bank clients.

Information theft and other losses due to cyber-attacks is a growing problem even in Japan. Fortification of information security has become an urgent priority for Japanese companies and organizations. NRI SecureTechnologies' Mitsuyoshi Sugaya spoke to information security expert Christopher Crowley, a SANS Institute certification instructor, about defenses against increasingly sophisticated cyber-attacks in the US.