EXCLUSIVE Harvard was not pressured by Toshiba, ex-Japanese adviser says
BOSTON / TOKYO, June 22 (Reuters) – A former Japanese government adviser said he did not press the Harvard University endowment fund to influence its vote at the disputed shareholders meeting of Toshiba Corp (6502.T) last year, and that the fund is expected to “set the record straight”.
Hiromichi Mizuno, until recently an adviser to the Ministry of Economy, Trade and Industry, was identified by a shareholder-commissioned inquiry this month as a prominent figure in what he called collusion management with METI to block the influence of foreign shareholders. Read more
Mizuno told Reuters he volunteered with METI officials to speak to Harvard Management Co as he was about to start a scholarship at the university last year.
Mizuno, a board member of U.S. electric vehicle maker Tesla Inc (TSLA.O), said he discussed potential risks to the Harvard fund, known as HMC, regarding voting at Toshiba. The main shareholder of the conglomerate, the activist hedge fund Effissimo Capital Management, was demanding seats on the board of directors.
HMC was also an investor in Singapore-based Effissimo, sources previously told Reuters.
Mizuno made it clear to HMC that he is not representing the Japanese government, he said.
“I don’t care how you vote,” Mizuno told the foundation’s leaders.
Mizuno’s comments to Reuters in an interview on Monday night were his first public remarks on Toshiba since the investigation revealed that management had colluded with METI to block the influence of Effissimo, HMC and other foreign shareholders. , and provided further details on the talks. He had previously told the Financial Times that he was not representing the Japanese government.
Mizuno’s account also sheds new light on events at Toshiba. The incidents detailed in the investigation have rekindled concerns about Japan’s corporate governance and its openness to foreign shareholders, and appear to run counter to the government’s long campaign to attract more foreign investment.
A spokesperson for HMC declined to comment for this article.
A senior METI official with first-hand knowledge of the case, speaking on condition of anonymity, supported Mizuno’s account and said this was not reflected in the investigation.
Toshiba declined to comment.
The independent investigation found that Mizuno’s role compromised the vote at the July 2020 annual general meeting after HMC, which held a stake of more than 4%, abstained from voting.
It was not clear how HMC planned to vote at the meeting.
Mizuno told Reuters he was trying to keep his relations with Harvard friendly and asked the fund for clarification “to set the record straight.”
Mizuno is the former investment manager of the $ 1.61 trillion Japanese pension fund. He resigned from his post as special adviser to METI after being appointed United Nations special envoy, the government announced in January.
Part of Mizuno’s account contrasted with the investigation, which cites a letter from HMC indicating that the endowment received an unwelcome request from a person – apparently Mizuno – before the shareholders’ meeting and “found the exchange highly inappropriate in both content and timing. “.
The report says that even if Mizuno spoke as a private citizen, shareholders would understand his government influence.
METI has regulatory power over Toshiba’s foreign shareholders as the company is viewed as a strategic asset, manufacturing nuclear and defense equipment.
Mizuno told Reuters in a follow-up message on Tuesday that it served as a channel for HMC’s messages to METI and Toshiba after the fund became frustrated with the company, which was plagued by accounting and governance issues. and a low share price.
Mizuno said the executives of the $ 41 billion endowment, Managing Director NP “Narv” Narvekar and Chief Investment Officer Rick Slocum, praised his contribution.
HMC did not make Narvekar or Slocum available for an interview.
Effissimo had nominated three candidates to Toshiba’s board of directors at the July 31 meeting, all of whom were opposed by management. None failed to be elected although one obtained 44% of the vote. Read more
Mizuno said he wanted HMC to understand the potential consequences of the vote, given that new foreign ownership rules in Japan could control HMC’s ties to Effissimo.
Sources previously told Reuters that Mizuno raised the possibility of a regulatory investigation if HMC votes against the interests of Toshiba management. Mizuno told Reuters he wanted to help HMC avoid surprises.
“I made it clear that I was only trying to give enough information” for the fund to understand how things worked in Japan, he said.
($ 1 = 110.3700 yen)
Reporting by Ross Kerber in Boston and Makiko Yamazaki in Tokyo; Editing by David Dolan and Timothy Heritage
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