Japan's trade and industry ministry effectively colluded with Toshiba Corp's (6502.T) management to undermine shareholders' rights, an independent probe into the company's controversial shareholders' meeting last year found.
The report from the investigation, released on Thursday, is likely to heighten investor concern about governance and government interference at the conglomerate.
It comes after activist investors including top shareholder Effissimo Capital Management successfully pushed for an investigation into whether Toshiba had applied pressure on shareholders over voting at the meeting.
Reuters has reported that the Harvard University endowment fund had been told by a Japanese government adviser it could be subject to a regulatory probe if the fund did not follow management's recommendations at last July's AGM.
The investigators' report found that Toshiba had effectively asked a government adviser to talk to the Harvard University endowment fund to change its voting.
It also found that Toshiba, with the Ministry of Economy, Trade and Industry (METI), tried to force Effissimo to withdraw its shareholder proposal calling for a probe.
"Toshiba, so to speak in unison with METI, devised a plan to prevent Effissimo from exercising its shareholder proposal right at the AGM," investigators said in the report, which was released by Toshiba.
No one was immediately available for comment at the ministry.
Toshiba said it "will carefully review this investigation report and plans to announce its comments towards this investigation result at a later date."
The controversy comes amid a push by Japan's government for improved corporate governance.