Ongoing requirements for running a Japanese kabushiki kaisha

Ongoing requirements for running a Japanese kabushiki kaisha

The key people in the organization will be the directors, and especially the person called the representative director. The representative director is the most powerful representative of the company because he or she represents and can therefore bind the company. Note the title "Representative Director" is merely a legal title, and is usually used in addition with other titles like "president" or executive vice president.

Although the representative director can bind the company, other people such as managing directors and vice presidents can create liabilities for the firm as well. Because of this, all managers, and especially the representative director should be chosen carefully.

Nevertheless, the representative director's powers are not absolute. For decisions regarding acquisition or disposal of key assets or the hiring and firing of key people, the representative director must consult with the board of directors.

A firm may have more than one representative director. However, a joint venture that tries to do this may encounter unnecessary problems if one of the representative directors is based out of the country because the written approval of both representative directors is required for many basic corporate acts.

Each kabushiki kaisha also requires a statutory auditor. This auditor must not be an employee of the firm, but he or she need not be a CPA. If the KK's capital exceeds about $5 million, it must have at least two auditors, and must undergo audits by CPAs.