is Kawai consider a family-run business?

I think it is...

I think it is...

I so much wanted to say "No, I think it is!"

But looks like maybe it isn't. Seems that it's a publicly traded company (link) -- i.e. there's stock and shareholders and stuff.

I suppose that doesn't necessarily mean it's not a family-run business, but usually it does. I guess it depends on:

-- whether the family owns more than 50% of the shares (which in itself would make the answer "yes")

-- .....or, if there are different "classes" of shares and that some of the shares don't have any voting power, so that even though the family doesn't own 50% they still have more than 50% of the votes (this in itself also would make the answer "yes").

And if neither of those, I guess it could still be considered "family-run" if (and I'm just making this up as I go along) .....

-- if enough people very friendly to the family interests own enough of the stock to make the total be over 50%, or

-- if the people doing the actual day-to-day operation of the company have essentially a free reign, even though they don't have control of the voting.

Please realize, I don't really know what I'm talking about.
But maybe this is about right anyway.

Why I was interested to go through all this: I'm curious myself about the answer, because I love Kawais. We have two of them in the family. (But no shares or voting power in the company.)

I say yes, it is, unequivocally a family enterprise. The business was founded in 1927 by Koichi Kawai and then his son, Shigeru expanded and upgraded the factories in the 1980s. It is currently run by Hirotaka Kawai, the grandson of Koichi. Each of these men has made a very significant contribution in the development of Kawai pianos.

Robert.

What about the fact that the company is "publicly owned"? (See post above yours.)

There is a difference between family-run and family-owned. It can be publicly held and still be family-run.

In those situations the family usually holds a controlling interest in the stock.

But a member of the Kawai family runs it, right?

Family owned is fairly clear. Ownership is a legal concept. If the firm is not publicly traded, and the family owns the existing shares, then it's family owned. If a firm is publicly traded, and the "family" does not maintain a controlling interest, then it is not really family owned any more.

Family run is a rather more imprecise term. It could mean the family calls all the shots. It could also mean the family has some small influence on decision making. And it could mean anything in between.

The OP asked if Kawai was family run. But he didn't specify what he meant by the term. If he wondered whether the Kawai family has some influence, I suspect the answer is yes. Does the family exert complete control? Got me.

Ford Motor Company is a good example of a publicly traded company where the family maintains a controlling interest.

http://www.kawai.co.jp/worldwide/company/index5.html

I don't know if this page and its associated links answer the question completely, or sufficiently. They do give an indication that there is not one 'Kawai,' as there seem to be a number of subsidiaries that have branched out into diverse areas such as the manufacture of auto parts and business software.

If someone can read Japanese, the home site may give more details. The company is listed on the Japan Exchange, and there's undoubtedly an annual report or some other public document that would spell out the business relationships.

From what I have heard about Japanese corporate structure a 2/3 majority vote is required to make any decisions. Because of that 34% ownership is considered a "controlling" interest since they can prevent the passage of anything they don't like. At least this is what I have been told - that in Japan one could own 66% of a company's stock and still be unable to affect its direction.

If that is true, then the family could hold a controlling interest without a majority interest.

For most companies, in Japan or elsewhere, a controlling interest is usually much less than 50% of the voting stock. Often, as little as 10% is sufficient to effectively block anything truly controversial. If you've got 10%, the other side has to get over 55% of the remaining votes. People usually don't want to ram stuff through except in extremis, so 10% is often enough to steer things to a mutually acceptable compromise. A 25% stake is even more powerful, obviously.

Right -- I included that!
But the question is, is it?

(It isn't usually.)


But the question is, does it?

(It usually doesn't.)

I don't remember where I read it but from what I recall, Shigeru MARRIED into the Kawai family and changed HIS name to Kawai.
If that's true then I guess Hirotaka is Koichi's maternal grandson--but related by blood none the less...

Think this is an interesting topic!

In the case of European makers it has always been very interesting to me to find out who actually owns things or runs things in factory - not necessarily same people.

But aside from that, the most interesting question, at least to me, has always been on what basis decisions were actually being made, the philosophy or rationale behind it.

One thing that I have found is that maximizing profit does not rule manufacturers same way, with those having to report to shareholders being generally in a tougher spot.

Norbert

Not sure about today, but in the 90's Mitsubishi Bank held controlling interest in Kawai, with the family at 11%.

Now we're really getting somewhere....

Hehe, oh really? Where's that?

Kawai is majority owned by Mr. Kawai, so it is still a family owned and operated business. I do not know the exact percentage of shares, but he owns the majority of the shares.

The company Mr. Kassman refers to was a branch of the Kawai company that owned and operated golf courses in Japan. That company had financial difficulties so was owned mostly by the bankers towards the end. The debts incurred through that mess were paid off by the continuing success of Kawai's piano business, and through the sale of the properties, etc.

I hope this helps.

Sure does -- if it's so.

It would help more if someone could find what's the actual percentage.

I can't read Japanese but if someone else can, they could probably look up the number of shares here

http://www.tse.or.jp/disc/79520/140120110609051812.pdf

Kawai has 85 million outstanding shares if I understand right. Page 9 looks like it might be describing major owners.

Sorry, best I could find.

No "sorry" needed! All we need is someone who can read Japanese!


Hey, we must have 1 or 2 or 3.....

According to google translate, the 85 million is the number of outstanding shares. Below that is the number of shareholders. The list of names with percentages are major shareholders. From what I can tell they are all institutional investors (banks and insurance companies). Mr. Kawai is not listed among them. Perhaps there's another section for insider ownership.

Looks like maybe we're getting closer. (Good work!)

With such a subject, if someone is interested in knowing the real answer, you can't 'assume' anything, and it looks like that's what some people are doing. But of course if it turns out they're right, it was with good reason.

I know that in general there's an impression that Kawai is essentially "family run," and I guess that's where the assumptions are coming from. Maybe in some sense it's true regardless of percentage ownership, and in fact that's my impression too. So to some extent it depends on exactly what someone means by "family run," and as people have said, that can mean different things. But it's looking like we don't know any of it for sure.

Interesting to note that of Kawai's major outstanding stockholders both Nippon Life Insurance and Japan Trustee Service Bank are major shareholders in Yamaha as well . . . and while Kawai's own holdings are also listed, for practical purposes this is not closely held stock, so the actual numbers do not tell the entire story . . . my guess would be that Mr. Kawai gets done what Mr. Kawai needs to get done . . .

Mike

Very possible even if the family's holdings are well under 50%.

I don't know if it works the same way in Japan as in the U.S. with a publicly-held company, but.....the way it is in the U.S., most shareholders pay little attention to most details of the company's operation and even to their own voting. Usually almost everyone either votes according to what is recommended by management, except for those who don't even bother to vote, which is many.

From the posts here, it seems that the family may well not own a majority of the shares, but that it probably does have the major say in what goes on -- but in theory, they might not always, because they could be outvoted on anything at any time. So, does this mean "family run"?
And is that really how it is?

The only thing I know for sure is that I like Kawai pianos a lot, and have for a long time.

Mark,

KawaiDon is an executive with Kawai. I would accord his view a bit more weight than our musings.

+1

Sure.
But he didn't give specifics. And anyway I wouldn't assume that executives always know such things. Would you, in general? Executives may have differing levels of interest or knowledge about exactly how much of the stock a family owns.

I didn't mean it's not true, just that from what we've seen here, we don't know.

We're both right.