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This study compares the short-term behaviour of finance directors the UK and in Japan, in the context of their corporate governance systems, using the funding, structure and evaluation of Research and Development (R&D) projects as indicators. The empirical part of the study consists of two questionnaire studies carried out in the UK and Japan. A number of personal interviews were also carried out with UK and Japanese senior finance managers. The results of the study indicate different management behaviour with respect to short-termism in the UK and Japan. There is a statistically significant difference in perceptions between the finance directors of two countries. Managers in both countries appreciate and would like to use long term performance criteria to assess and manage R&D projects. In practice however, Japanese finance directors are much better protected from short-term pressures than their UK counterparts in dealing with most aspects of their management R&D. These differences in behaviour are identified and possible reasons for them are offered in the paper. [ABSTRACT FROM AUTHOR]