ABSTRACT
Changes inside companies and introduced by public policy initiatives are gradually creating a new institutional framework. The notion that Japanese employees do not move from job to job misrepresents the actual record. Mobility is increasing and a number of studies provide evidence that employment practices are adapting towards a more differentiated and more flexible system that makes greater use of the external labour market and non company-specific skills. The convergence towards Western corporate governance practices is indisputable in regard of some practices such as the importance given to investors' relations and the changes at board director level. A shift towards a shareholder-driven type of governance in Japan will not only affect operational aspects such as the composition of the board of directors. In response to the forces of globalization, Japanese public authorities may feel entailed as some continental European countries to exercise tight control over the deregulation process in order to maintain social stability.
