The model from the Land of the Rising Sun is quite specific, so it is most often used in this country. Its peculiarity is the approach in which the ownership of securities is carried out in a cross-method. Another difference is that shares are allowed to be purchased only by large and medium-sized investors. Purchase for individual entrepreneurs and individuals is not provided. The latter characteristic can be attributed to the disadvantages of the method.
When using the Japanese model, banks actively participate in the organization's activities. At the same time, the company does not set the goal of owning a large number of shares and behaves passively in the market.
Since the approach opens up the usage of facebook database great opportunities for creditors, corporations, as a rule, work on a permanent basis with only one bank. Such cooperation provides certain advantages for doing business, but still, full access to resources (including shares) from credit institutions can negatively affect the company's profit. Despite the shortcomings, the model is quite workable for achieving commercial goals.
Japanese Model of Corporate Governance
The main source of income for Japanese companies is dividends. It is in this part of the business that cooperation with banks is important.
Entrepreneurship in Japan has been characterized by low liquidity for many years. Consequently, the most reliable source of profit in the Japanese corporate governance model is banks. That is why business in this country often relies on the active participation of credit companies.
Another advantage of the method is a high level of protection from the impact of the external environment. For example, the purchase of all securities or the company itself by more developed competitors occurs extremely rarely.
The management structures in a corporation are created in such a way that competitors cannot buy it. This is ensured by the partner bank, protecting the assets of the organization.
It is obvious that the Japanese model can become a reliable means of achieving the set goals, despite the fact that externally the activity will not demonstrate the criteria of active development. The company takes a passive position, receives a stable profit and at the same time is under the protection of the bank that finances it.
German Model of Corpor