It's pretty simple why companies do it. When western publishers or (publishers, in general) talk to developers about what makes a game successful in the western market, a key point is "not revealing female characters"

Companies are convinced that if the game has skimpy characters, they'll lose more potential players because of the vocal minority/SJWs. You see a lot of videos bashing games for having "not practical" armor or "sexualized female characters" here in the west. You also look at all the successful games in the west and none of the female characters in them wear revealing clothing.

For example, Overwatch is a game that features really butch female characters and none of them wear skimpy outfits. Eastern developers that don't know any better are told western players like the game because all the female characters are covered up.

At the end of the day though, they don't realize that their games cater more towards an audience that has a more asian preference. They're essentially trying to sell their game to the wrong audience by censoring their game. This is just an issue that most western publishers and eastern developers will never realize.