What are the basic features of the German and Japanese models of corporate governance?

In Japan and Germany, although there are well-developed stock markets, enterprises have limited fund-raising from them, high debt ratios of enterprises, relatively concentrated shareholdings mainly held by industrial corporate shareholders (the phenomenon of cross-shareholding among enterprises is common), and banks are also shareholders of enterprises. In these enterprises, banks, suppliers, customers and employees are actively involved in corporate governance matters through the company's board of directors, supervisory board, etc., and play a supervisory role.

These banks and major corporate shareholders form what is known as an "insider group.

In Japan and Germany, the long-term stable capital and trade relations between enterprises and banks constitute an internal mechanism for monitoring and restraining the operators, which is called the internal governance model. Comparatively speaking, the governance model of Japanese companies more reflect a business class dominated model, because under normal circumstances, the operator's decision-making independence is very strong, rarely directly affected by shareholders; the operator's decision-making not only covers the company's general issues, but also around the company's strategic issues, and the company's long-term development is in a position to prioritize. The German governance model is more reflective of a *** with the decision-led model, in the operation of the company, shareholders, managers, employees *** with the decision of the company's major policies, goals, strategies, etc..