Japan¡¯s financial regulator is urging the country¡¯s listed companies to spend more of their cash piles on long-term business investment instead of rewarding shareholders with buybacks and higher dividends.
In addition to cash, executives should consider utilizing cross-shareholdings and real estate property for growth, Tatsufumi Shibata, a senior official at the Financial Services Agency, said in an interview. Japanese companies tend to prioritize payouts to shareholders regardless of where they stand in the growth curve, he said.
¡°I don¡¯t think investors demand that from companies that are in a rapid growth phase,¡± he said in an interview.
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