Toyota Chairman Akio Toyoda Re-elected Amid Governance Concerns

At the recent annual general meeting of Toyota, Chairman Akio Toyoda and other board members were re-elected, despite facing concerns regarding governance and certification test scandals. Two proxy advisers had advised against Toyoda's re-election, citing issues with safety and certification testing violations at group firms. However, Toyoda's re-appointment was expected due to strong support from other Toyota group firms and impressive business results.

Toyoda's approval rating dropped to 85% last year, mainly due to the safety and certification testing violations. Proxy advisers criticized Toyota's handling of these issues, leading some investors to vote against Toyoda's re-election. Concerns were also raised about the board's independence, strategic shareholdings, and return on equity.

Most of the opposition to Toyoda likely came from overseas investors, while he continues to enjoy popularity among retail investors. Despite recent certification irregularities, Toyoda's leadership is backed by the company's record profits and stock performance. Shareholders rejected a proposal for increased disclosure of climate lobbying.

Toyota admitted to incorrectly conducting six vehicle certification tests, impacting models that are still on sale. The company's shares experienced a decline following the revelations but have since recovered, remaining positive for the year. CEO Koji Sato issued an apology for the certification problems, although neither he nor Toyoda directly addressed the recommendations put forth by the proxy advisers.

Despite facing challenges related to governance and certification scandals, Toyota's leadership under Chairman Akio Toyoda continues to be supported by strong business performance. The re-election of Toyoda, amidst some opposition, highlights the complexities of corporate governance and the importance of addressing shareholder concerns. Moving forward, Toyota may need to consider governance reforms to maintain shareholder trust and uphold transparency in its operations.