Nomura CEO Re-elected Amid Scandals, Shareholder Support Drops 7.2%

Nomura Holdings Inc. CEO Kentaro Okuda was re-elected to the board despite facing significant scrutiny and previous scandals. At the Tokyo annual meeting, Okuda received support from 82.5% of shareholders, a decrease from the 89.7% support he received the previous year. This re-election comes amidst a backdrop of record profits for the company, but also in the wake of a bond market manipulation case and a violent crime involving a former employee. These incidents have put a spotlight on Nomura's corporate governance and shareholder trust strategy as the company enters the new fiscal year.

Shareholders also rejected a proposal to rename the firm “Nomura Securities Group.” This proposal, aimed at reconnecting with the founder’s principles after damaging scandals, was the first shareholder-tabled motion in 13 years to be rejected. The decision underscores both unease with the company's reputation and concern over executive accountability. Despite opposition from proxy adviser ISS, both Okuda and Chairman Koji Nagai retained their board positions. Okuda's leadership saw a record profit year and a significant increase in his compensation to ¥1.208 billion. However, the scandals have highlighted weak internal controls, leading investors and analysts to evaluate Nomura's corporate governance and shareholder trust strategy for signs of deeper reforms.

Okuda’s annual compensation more than doubled, rising to ¥1.208 billion ($8.3 million), while other top executives also saw increased remuneration. For example, Christopher Willcox earned US$15 million, despite joining after the scandals. Though Nomura achieved its best financial results in years, the optics of high executive pay amid misconduct have fueled discontent. The company's internal review process has been called into question as it grapples with a scandal involving a former trader and a separate case of attempted murder linked to an ex-employee. These developments have intensified focus on Nomura's corporate governance and shareholder trust strategy, where investors now demand more accountability and better oversight.

Proxy adviser ISS recommended voting against both Okuda and Nagai due to the scandals. Although shareholders re-elected them, the reduced margin of support signals discomfort. The rejected name change proposal and lukewarm confidence reflect deeper governance issues that have yet to be fully addressed. Investors expect Nomura to take meaningful steps toward rebuilding trust. As Japan’s largest brokerage, Nomura must align performance with ethics. A strong corporate governance and shareholder trust strategy is now not just an investor demand, but a strategic necessity. Governance culture, executive pay, and branding are all under pressure as the firm seeks to restore long-term credibility.

With scandals still fresh and shareholder confidence shaken, Nomura faces pressure to overhaul its governance. Further reforms, internal control upgrades, and communication transparency will be crucial. Okuda’s re-election, though secured, came with a clear warning. The corporate governance and shareholder trust strategy must evolve to protect brand value and retain investor confidence. Future meetings could bring renewed scrutiny if visible change doesn’t follow.