Keiretsu are networks of Japanese companies linked through cross-shareholdings, shared banking relationships, and business partnerships.
Major Keiretsu Groups
- Mitsubishi: MUFG bank, Mitsubishi Corp, Mitsubishi Motors, Mitsubishi Electric
- Mitsui: Mitsui & Co, Sumitomo Mitsui Financial
- Sumitomo: Sumitomo Corp, NEC
- Toyota Group: Toyota, Denso, Aisin
Cross-Shareholdings
Historically, keiretsu companies held each other's shares for mutual protection. This reduced hostile takeovers but also reduced shareholder returns.
Unwinding
Since the corporate governance reforms of 2014-2023, cross-shareholdings have been declining. TSE requires companies to explain why they hold 'strategic shares' — and many are selling. This has been a major catalyst for Japanese stock market gains.