Introduction
Dividend strategies have become increasingly prominent in Japan’s equity market. By the end of 2025, assets under management (AUM) in Japan-listed dividend index funds reached approximately JPY 1.9 trillion, nearly 18 times the level recorded in 2016. From 2024 to 2025, dividend index funds witnessed more than JPY 600 billion in net inflows in Japan, surpassing other factor strategy categories. This growth indicates rising demand for stable income and highlights the growing importance of dividends for the Japanese market.
This paper reviews the key policies that have shaped Japan’s dividend market, examines how the market has evolved over the past decade and assesses the historical performance of Japanese high dividend yield strategies.
Governance Reform Overview
Japan’s dividend market transformation has been supported by a sequence of governance and investor policy reforms. These measures were designed to strengthen investor engagement, encourage companies to improve capital efficiency and promote a shift in household financial assets from savings toward investment products.
