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BOOK SERIES | Minority Shareholders, Chapter 19: An Association for Family Company Governance

Takano's vision grows into a company plan. He talks it through, realizing it's all about families in Chapter 19 of Shin Ushijima's novel, Minority Shareholders.



In this chapter of Minority Shareholders, I continue the story of Norio Takano. He is not a specific person; he is a character created for my book out of some high rollers who had existed during the bubble period.

As a young lawyer, I witnessed the generation of enormous wealth from scratch. A minority shareholder of a family company brought an action to the court and succeeded in taking hundreds and thousands of yen. I saw it firsthand. Ten years after the bubble popped, I started work related to corporate governance. In this book, my fictional characters tell the story of problems that persist in joint-stock corporations. What is an organization called a company? What if Norio Takano were reborn in this era?

This story is a work of fiction. Any resemblance to actual characters or organizations is entirely coincidental and unintentional. ー Shin Ushijima

Read earlier chapters of the series.

Minority Shareholders
Book cover, "Minority Shareholders" by Shin Ushijima.

CHAPTER 19: An Association for Family Company Governance 

Continuing from Chapter 18: Norio Takano's lawyer, Tadashi Ooki tells him, "You're saying you are going to torch such owners. Do you understand what you're saying?"

"Oh, no, I'm not going to do that."

"I'm sure you are. If it becomes possible for minority shareholders to sell their shares, the owner-presidents will feel unstable. You just said you're going to demand that the owner-president improve the management. [...]

"I just want to lend a helping hand to those minority shareholders before my eyes," says Takano

Takano looked Ooki in the face.

"So I'm going to make a new company. But my concern is, as you said before, people in the world might think that what I'm doing is a dirty business seeking only profit. I have no such intention at all. I've just been driven by righteous indignation. I've never thought that money-making is a dirty business, but this time it's totally different. Please make my purpose clear to everyone. 


"By the way, what shall we name the new company?

"If our business is only to deal with the case of Auntie Sumida, it can be registered under my name or my company, I don't mind. But as I told you, the number of companies we'll have to deal with is likely to be an order of magnitude higher than I expected. 

"It's a business to handle other people's money; it's about buying other people's shares. Some people may think it's all for money. I don't want them to misunderstand. But I can't help it considering what I did before and after the bubble years. I know I have to face the music."

'Let's Talk About the Future'

"Having predicted the bubble collapse, you sold everything and withdrew from the real estate business at its heyday," says Ooki. "And after the bubble collapsed, you successfully restarted a real estate business again. Who else could accomplish such a rare feat?" 

"Here you go again! It all happened by an odd coincidence. I happened to fall in love with Eiko without knowing what that would entail. I felt like I was Sun Wukong (also known as the Monkey King) jumping and leaping on the palm of the Buddha."

"Even so, whatever, I was greatly impressed by your decision to withdraw from your business when in fact you had a great chance to make more money. At that time, I thought your decision was preposterous, but later I became convinced that you had made the right choice."

"Ok, that's enough. Let's talk about the future. I have no interest in the past. This plan is not for me. Let other money-seekers do whatever they want if their purpose is only to make money. I'm different. 

"Look, in Japan, there are more than 27,000 companies that have lasted over 100 years. Great! Right? Needless to say, a majority of those long-established companies are family-owned. There are a fairly good number of such long-established companies in Japan. 

"Comparatively speaking, there are only 1,500 such companies in Germany. Japan can boast about the existence of those time-honored companies. Even more surprisingly, there are about 3,800 companies that date as far back as the Edo era. Amazing, isn't it? Such is Japan. 

A Company's Purpose

"Oh, sorry, it looks like I'm lecturing a great lawyer with an attitude. I just crammed this knowledge. Since I started thinking about this plan, I have been studying a lot trying to figure out what has made such companies exist that long.


"And I have come to the conclusion that Japanese family companies do not put profits first. What do they make a priority? Keeping in existence forever. That's it. To put it in modern-day language, sustainability. If they can live on, that's enough for them. 

"Nobody gives a damn about minority shareholders crying behind the scene. They don't care about mixing public and private. So, I always remind myself that what I'm going to do should not be geared toward creating money. There should be a movement to save minority shareholders. 

"But at the same time, I want to tell people of the world that we should not use the movement as a means of creating money. It may well be that some people steal my idea and do similar things for the purpose of only making money, but it doesn't do any good to society or the nation."

Takano wouldn't stop speaking. "Look, Ooki, after Confucius had helped the first cow he encountered, I wonder if he encountered another cow panting with heavy baggage on its back. I think he did. He must have come across similar chances many times. 

"Then, what did Confucius do when he encountered the second cow? How about the third or the fourth? Did he do the same thing every time he saw a cow panting? You are not able to do it unless you have a gigantic fortune. Confucius was not that well off, nor was he a person in authority."

A Passion for Action

"Confucius may not have cared about the second cow. Nobody knows whether he really helped even the first cow. He might have wanted to teach his apprentice compassion, and that was enough for him. He might have known from the beginning that it was beyond his ability to save all the cows in the world. 

"In my understanding, if he was able to instill into his apprentice the passion for action, not for knowledge, he was satisfied. He wanted to teach his apprentice that it was meaningless to be all talk and no action. What do you think?" asked Ooki.

"Hmm, sounds like Yangmingism."

"Maybe. After all, Yangmingism is believed to have its origins in Confucianism. By the way, are you seriously saying, 'It doesn't do any good to the nation'? Wow, that's the last sentence I expected to come out of your mouth. Never did I dream of hearing you say such a thing. 

"It puzzles me, but I understand what you mean. Since I'm a lawyer, if asked, I'll take sides with anyone unless it's illegal or goes against my sense of justice. I strongly believe that whoever I work for, it will contribute to the governance of Japan's law…only incrementally, though…invisible to the human eye."


"I know you. It explains why I want to hang on to you as my lawyer. Thinking hard, I find there is no time to be lost. I feel that I'm racing against the clock. So, I thought I needed to talk to you as soon as possible. Hence, here I am."

An Incorporated Association

"As soon as possible, huh?" Ooki took Takano's words lightly. "You're serious about it then?" Ooki said in a low voice, glancing at his hands on the table. Ooki spoke to Takano looking him in the eyes.

"Make it an incorporated association. That will work. An incorporated association is not allowed to distribute profits, so no one tries to make money through an incorporated association. If they want to earn money, surely they will establish a joint-stock corporation."

"Makes sense! That's how the world, scratch that, law works? I didn't know that. OK, now then, what shall we name it?"

"How about, 'Incorporated Association for Introduction and Promotion of Outside Directors for Unlisted Companies'? 

"No, hang on, since our purpose is not confined to only introducing outside directors to family companies, it can be misleading. What we want is to let it be known to the world that we are going to work on improving the management of unlisted companies. In cooperation with their shareholders. Using our position either as a shareholder or as a stalking horse, whatever the case. 

"To clarify that purpose, how about naming it 'Association for Promotion of Unlisted Company Corporate Governance'? The name gives away what kind of establishment we are. 

"It is believed in the world that corporate governance is only for listed companies, so the name can catch people's attention. And since it says promotion of corporate governance, people can know at a glance that it is one of our purposes to promote employment of outside directors."

"I wonder if ordinary people can understand what unlisted companies are. And 'un' sounds negative. But everyone knows what family companies are. Unlisted companies are usually family companies, right?"

It's All About Families

"Right. That's my Takano…you have such good people skills. Yes, it's better to use 'family' in the name, and call it 'Association for Promotion of Family Company Corporate Governance.' But it's a bit long. You should, with your good business sense, work out something that has a nice ring to it."


Takano and Ooki were eagerly chatting nose-to-nose across the table as if they were small children who had just procured a new toy that they had never seen before.

Takano suddenly raised his voice in excitement. "I got it! Let's go with 'Association for Family Company Governance'!"

"Terrific name! And that incorporated association will encourage unlisted companies and family companies to introduce governance and help minority shareholders sell their shares. Wow, it's going to be exciting. I can hardly wait to see how it'll come off. As for me, I can make some contribution to the world automatically while practicing law."

Continues in: Minority Shareholders, Chapter 20: A Contingent Fee Surprise


Minority Shareholders
Shin Ushijima, Esq

Minority Shareholders is a work of fiction and any similarity to real characters, companies and cases is purely coincidental and unintentional. Sign up to join our mailing list and look for the next chapter every Saturday on JAPAN Forward.

Author: Shin Ushijima

The founding partner of Ushijima & Partners, lawyer Shin Ushijima has an enormous wealth of experience in international transactions, mergers, and acquisitions, dispute resolution, system development, anti-monopoly law, labor, and tax law. Concurrently, he heads an NPO called the "Japan Corporate Governance Network." And in his leisure moments, he writes fiction. Additional details on Shin Ushijima's career, awards, publications, and more are available at his website: Ushijima & Partners, Attorneys-at-Law.


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