By Clayton Jones, writer of The Christian Science Monitor
The Christian Science Monitor
A RECORD 1,901 Japanese companies, or a majority of firms on the Tokyo Stock Exchange, held their annual shareholders' meeting Tuesday.
This peculiar collective action on one day may mark the beginning of the end for Japan's long recession, says business consultant Raisuke Miyawaki. With the meetings over, company executives feel freer from a silent but powerful influence on Japan's economy: the underground yakuza, or Japanese mafia, who often prey on these meetings as corporate racketeers.
A business recovery, which many Japanese economists say should have begun last year, may be on the way, says Mr. Miyawaki, who served as a top investigator of the yakuza during his 30 years with the National Police Agency. "The many businessmen throughout Japan who are scared by the shadow of the yakuza have been obliged to keep their businesses at a standstill," he says.
So many shareholders' meetings were held at once because companies, hit hard by the recession, are more afraid than ever of Japanese gangsters who threaten to expose their misdeeds at the meetings or just make embarrassing comments. Such blackmailers are called sokaiya, and almost all are tied to yakuza groups. National police estimate their number at about 1,200. This year, 7,264 national police were assigned to guard the meetings.
Calling themselves "grass-roots shareholders campaigners," the sokaiya can easily get access to a meeting by buying just a few shares of a company. To avoid embarrassment, many companies either pay off the sokaiya or dilute the potential for blackmail by holding the meetings on the same day. The problem was acutely spotlighted last year when three executives of a large retail firm, Ito-Yokado, were arrested for paying off sokaiya to avoid embarrassment at a shareholders' meeting.
Many company officials rehearse these meetings with lawyers months in advance to avoid being targeted by sokaiya. If no sokaiya show up, shareholders' meetings are usually little more than rituals, with minimal probing of management by shareholders. …