In February 2005, a fast-growing Japanese Internet service provider Livedoor placed a takeover bid for Nippon Broadcasting System (NBS), a radio network that was then the largest shareholder of Fuji Television Network. The rare hostile takeover bid had taken place when Fuji TV had been buying shares of NBC via takeover bid (TOB) system in order to correct "capital disorder", as NBS had actually been controlled by Fuji TV despite of its capital status. To block Livedoor's unwanted takeover attempt, NBC had declared its intention to issue the share warrants to Fuji TV. Since this significant example, managements of Japanese listed companies are seemingly to have been engaged to come up with equity related pre-emptive measures against hostile takeover. While these companies are focusing on defending themselves, there are hardly any signs of self-examining into their corporate governance. Managements should really put importance on auditors' role and choose the suitable person for the job. As far as NBS' case is concerned, Outside Corporate Auditor of Fuji TV did not functioned properly as they allowed "capital disorder" to happen. In general, it is effective to take a fresh look at auditing system to prevent hostile takeover. The Japanese new corporate law has recently introduced Special Director for Accounting ("Kaikei San-yo"), a post that is non-obligatory for a company to install but hugely responsible to the company's account once it is introduced. Although this role is aimed to increase the credibility of small and middle scale businesses, it should also be considered to apply for listed companies as such role is thought to be beneficial to support big companies' auditing system.
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