SoftBank governance reforms stop short of Vision Fund

TOKYO: SoftBank Group Corp has no plans to increase board oversight of its US$100 billion (RM428 bilion) Vision Fund, two sources said, disregarding calls from activist inve stor Elliott Management and signalling governance reforms have stopped short of the fund.

In recent months CEO Masayoshi Son has met other Elliott demands, from launching a ¥2.5 trillion (RM98.5 billion) buyback – vital to propping up SoftBank’s share price – to increasing the number of outside directors including the board’s only woman.

However even after a disastrous run betting on startups like officesharing firm WeWork that plunged the Japanese conglomerate to its biggestever annual loss, power structures at the Vision Fund remain largely intact.

US hedge fund Elliott asked SoftBank to create a subcommittee at board level to oversee and aid the Vision Fund’s investment process, sources previously told Reuters.

SoftBank has pushed back against creating such a committee, with executives arguing investments already vetted by top management and US$3-5 billion deals put to the large limited partners, said one of the people with direct knowledge of the matter, who declined to be identified as the matter was private.

The fund’s poor performance scuppered plans to raise a further mega fund from investors including the first fund’s anchor backers, the sovereign wealth funds of Saudi Arabia and Abu Dhabi. – Reuters