TOKYO — As Fujitsu shifts to a business model focused on software, the company is also taking steps to incorporate investor perspectives in its governance with the addition of an outside director from an asset management company.

The Japanese technology powerhouse will name Scott Callon, CEO of Ichigo Asset Management, as an independent director pending approval at Fujitsu’s shareholders meeting this June.

Fujitsu has high expectations for its outside directors as the company recasts both its business model and corporate governance.

Experts disagree on the wisdom of giving board seats to officials hailing from investment funds. Critics argue that the funds gain an informational advantage over other shareholders — and they also cite cases in the U.S. of such directors voting against corporate policies that would benefit society but not contribute directly to profits. Supporters note that venture capital firms can boost value by sending officials to their investment targets.

Nikkei spoke with Fujitsu outside director and board chairman Atsushi Abe, who worked for years at investment funds.

Edited excerpts from the interview follow.

Q: Please tell us about inviting Scott Callon to sit on Fujitsu’s board.

A: Our company has announced a plan to have outside directors constitute a majority of the board to diversify the board and stimulate discussions. Lawyers and former bureaucrats are among those who typically become candidates, but we wanted to broaden the field to include business managers and investors to improve diversity.

When we asked our shareholders how they feel about us inviting officials from asset managers to join the board, this was received favorably along with predictions that the stock price will rise. And several shareholders mentioned Mr. Callon’s name. Ichigo is our shareholder, so we have been in dialogue with them, and we know how they think, so we decided [to invite Callon].


Atsushi Abe, outside director and chairman of the board of directors at Fujitsu. (Photo by Natsuko Segawa)

Q: With corporations now busy dealing with the novel coronavirus pandemic, what do you expect from Callon?

A: I hope that he can present the voices of shareholders and the capital market to the board, specifically and directly. Regarding coronavirus measures, I would like him to share insights into what other companies are thinking and doing by tapping his connections with listed companies, including those in other industries.

Over the medium term, I believe that the current pandemic with fundamentally change how companies think about sustainability. Our investors have been pointing out that if we make the shift to software and services, the amount of capital needed for capital investment will decrease, so we should reduce our equity ratio by increasing low-interest loans.

But the coronavirus has forced us to rethink the balance between risk management and the optimum capital structure. I hope that Mr. Callon can provide his opinions on how the thinking of the capital market and shareholders will change or will not change.

Q: What steps is Fujitsu taking to deal with the coronavirus?

A: First, to ensure personnel management and business continuity, we have begun ascertaining infections among employees and dealing with that, in addition to taking safety measures, and we have begun gauging how the coronavirus will impact our business environment, including finance and transport systems.

We are also looking at contributions to society. For example, we are considering building and providing data platforms that can help ascertain and reduce coronavirus infections, track infections, detect and predict infection clusters, and prevent a collapse of the health care system.

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