The Tokyo Stock Exchange¡¯s rare call for better capital efficiency has made Japanese companies scramble to compile action plans to avoid being seen as laggards, the chief of Mizuho Financial Group¡¯s trust banking unit said.

¡°There has been a sense of urgency brewing among companies¡± ahead of January, when the TSE starts publishing a list of companies that have disclosed action plans in line with its call to improve their use of capital, Kei Umeda, CEO of Mizuho Trust & Banking, said in an interview.

The TSE¡¯s reform push has been hailed by investors as a remedy to Japan¡¯s unusually high number of chronically undervalued stocks, but only 20% of companies listed on the top ¡°prime¡± section had disclosed specific measures as of July.

Mizuho Trust¡¯s corporate finance consulting service has seen a surge in demand, having 60 to 100 client meetings every month to discuss how to boost price-to-book ratios, Umeda said.

His comments show that the bourse¡¯s planned disclosure of compliant companies has been creating ¡°naming and shaming¡± effects on laggards, where about half of listed firms are trading below their book value.

Even though the TSE¡¯s call is not legally binding, many companies ¡°care hugely about what others in the same industry or in the same region are doing,¡± Umeda said, adding that they don¡¯t want to be seen as lagging behind.

The TSE call has already sparked a slew of own share buybacks, unwinding of cross-shareholdings and some management buyouts (MBO) that take companies private to escape shareholder pressure.

Japan has had 16 MBO announcements this year, with total value of a record ?1.19 trillion ($8.11 billion), including Taisho Pharmaceutical Holdings¡¯ $4.8 billion deal, according to Recof Data.

¡°Costs associated with listing have come under more scrutiny,¡± as advantages of having the listing status in financing have faded, Umeda said. ¡°We are seeing a growing number of companies choosing to go private as they prioritize speed in decision-making.¡±