The Timing of Governance Redesign as Listing Approaches
On June 3, 2025, a seminar titled “The Realities of Listing on TOKYO PRO Market and Step-Up Strategies” will be held in person, featuring a former TSE examiner and a J-Adviser (listing advisor). One of the key themes of this seminar is governance design that accelerates business growth.
For SME owners, listing is not a “goal” but a “starting line.” However, many entrepreneurs first encounter serious governance design during the listing preparation process.
This article uses this news as a springboard to explore how the TOKYO PRO Market option impacts governance design for SMEs, along with specific actionable steps.
Three Changes TOKYO PRO Market Brings to SMEs
Governance Standards Different from Traditional TSE First and Second Sections
TOKYO PRO Market is a market operated by the Tokyo Stock Exchange, with more relaxed listing criteria compared to the traditional First and Second Sections. Specifically, requirements such as market capitalization and number of shareholders are set lower, making it easier for SMEs to list.
However, governance is not “loose.” On the contrary, after listing, stricter internal controls and information disclosure are required from the perspective of investor protection.
The key point here is to avoid the misconception that “relaxed criteria mean relaxed governance.” TOKYO PRO Market serves as a “nurturing market” where SMEs can gain listing experience while gradually strengthening their governance.
Medium- to Long-Term Governance Design Through Step-Up Strategies
The seminar uses the term “step-up strategy.” This refers to a strategy that, after listing on TOKYO PRO Market, aims for a future transition to the TSE Prime Market or Standard Market.
This perspective is extremely important for SME owners. If the only goal is “getting listed first,” governance design becomes ad hoc, leading to significant revision costs later on.
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