**Toyota Motor Chairman’s Concerns Over Reelection**
Toyota Motor Chairman, Akio Toyoda, expressed concern over his reelection as a director, stating that if shareholder support continues to decline at its current rate, he may not be reelected. The chairman’s support among shareholders plummeted to 72% at the company’s recent annual general meeting, a significant drop from the 85% support he received in 2023. In fact, this was the lowest level of support a director has ever received in Toyota’s history.
**Proxy Advisers’ Influence on Shareholder Support**
The decline in support for Toyoda came following recommendations from proxy advisers to vote against his reelection. Both Institutional Shareholder Services (ISS) and Glass Lewis took issue with the way Toyota handled certification testing violations. This criticism from proxy advisers likely influenced the decisions of institutional investors, causing a decline in support.
**Weak Support from Foreign Institutional Investors**
Of particular concern was the weak support from foreign institutional investors, with only 34% backing Toyoda. This lack of support from international investors reflects the growing concerns over the chairman’s actions and raises questions about his leadership. It remains to be seen how Toyoda will address these concerns and regain the trust of foreign institutional investors.
**Mixed Support among Domestic Institutional Investors**
While Toyoda’s support among domestic institutional investors was slightly higher at around 55%, this is still a significant decline from the previous year, where support stood at 70% or higher. This suggests that approximately half of domestic institutional investors are calling for Toyoda to step down due to his behavior over the past year. The chairman must address these concerns and regain the confidence of domestic investors to maintain his position.
**Strong Approval from Retail Investors**
In contrast to the declining support from institutional investors, Toyoda enjoyed a nearly 99% approval rating among retail investors. This strong show of support demonstrates the loyalty and confidence of individual shareholders in the chairman and his leadership. However, it is crucial for Toyoda to also address the concerns of institutional investors, as they hold significant influence over the company’s overall direction.
**The Future of Toyoda’s Leadership**
As the grandson of Toyota’s founder and with a long history in the company, Toyoda’s potential departure as a director would mark a significant change in the automaker’s leadership. The chairman’s acknowledgment of the declining support and his concerns about the future suggest a willingness to engage with shareholders and address their concerns. It will be essential for Toyoda to take proactive steps to regain support and strengthen his leadership to ensure the continued success of Toyota Motor.