One of Asia’s foremost advocates of better corporate governance died aged 60 in January 2026. This was David Webb, founder of the eponymous “webbsite.com," on which he based his long and successful campaign against the abuse of public company shareholder rights in Hong Kong. A wide cross section of the business community there, from regulators to retail investors, admired his extraordinary contribution to the fight against collusion and corruption and his efforts to foster greater transparency in listed stocks. His FT obituary noted: “In the 1990s Hong Kong’s financial markets were a regulatory wild west. There were weak protections for minority shareholders, a lack of disclosure and feeble oversight by company boards.” Since 1998, operating alone through his website, he campaigned for improvements in all these areas and took on vested interests wherever he found them. He served as a nonexecutive director at Hong Kong Exchanges and Clearing from 2003-8 and as a panel member for the Securities and Futures Commission for 24 years. His most high profile achievement was his expose in 2017 of the “Enigma” network of 50 public companies which utilised extensive cross shareholdings to sustain higher valuations than would otherwise have been likely - the resulting transparency led to a shakeout in which share prices fell to more realistic levels, in one case a decline of 90%. His work was recognised by the award of an MBE last year.
Japan has benefited from similar improvements, albeit on a completely different scale and with different dynamics. The Japanese market was an uphill battle and ultimately fruitless for activist investors for decades until eventually there was a government led corporate governance revolution. The Stewardship Code (2014) and Corporate Governance Code (2015) provided the framework. The Tokyo Stock Exchange applied pressure on companies trading below book value and there was an explicit focus on return on equity (ROE) and capital efficiency. More than 95% of Prime Market companies now have independent directors, while nomination and remuneration committees have become mainstream. These policies have driven record share buybacks and divestments; there has been a measurable improvement in equity returns and higher foreign investor participation. The reforms are framed as a “Value Up” agenda rather than compliance which has been more appealing to local market participants but provides a similar result. A re-rating of the Japanese market has followed.
Korea is trying to replicate Japan’s success and is finally targeting the “Korea discount” which has dogged the market since it emerged as an “Asian Tiger” economy in the 1980s. The Corporate Value Up Program was announced in 2024, based on incentives to raise ROE, dividends, and governance transparency. The new Korea Value Up index is designed to channel investor capital so that global investors are already reallocating from Japan to Korea in anticipation of reform payoffs. However, entrenched “chaebol” (conglomerate) cross holdings and tax distortions are among some of the obstacles still to be overcome. Korea is where Japan was a decade ago with global capital watching in real time, but will they be able to pull it off?
Travelling south to Singapore, a small but sophisticated market, there is another government policy led initiative designed to benefit from North Asia’s success with its Value Up approach. The Equity Market Development Programme (EQDP) borrows from the success of Japan’s approach and follows Monetary Authority of Singapore (MAS) consultation to address structural ROE and trading volume weaknesses. Singapore’s approach is through capital market engineering rather than via governance confrontation - a more pragmatic, cautious, and state curated version of “Value Up.” In typical Singapore style the reforms are incremental and debate continues over their effectiveness on issues such as mandatory disclosures, board accountability, and protection of minority shareholders.
Investor activism has become more successful in Japan and Korea because in both cases the state has legitimised it rather than activists suddenly becoming more persuasive. Governments have ushered in greater alignment of boards, regulators, and investors and emphasised the incentive of higher valuations as a result, and when the state itself has rising liabilities in government-related pension funds the incentive for higher valuations takes on an overtly political angle. Demographic pressures are as great in Asia as in the west. Singapore also leans towards government-sanctioned improvements but has focused on a capital allocation led version of Value Up and relied on local regulatory institutions (which adhere closely to government direction) rather than on explicit changes to the legal framework. Hong Kong remains an outlier in this respect. There have been technical governance upgrades and even since July last year enhancements include capped tenures of Independent Non-Executive Directors; diversity disclosures; mandatory director training; and improved shareholder engagement. However, none of this has been government led, there has been no deliberate or explicit Value Up or ROE reform driven agenda in a city whose historic “laissez faire” attitude to business remains an important driving force. David Webb was motivated more by an obsession with fairness and egalitarianism than a desire to improve valuations and financial gain, although he would have been the first to acknowledge these benefits. Good governance is good business, or as a famous Asian political leader once said: “Who cares if the cat is black or white as long as it catches mice?”
March 2026