Assisting Business

The Sales Support Alliance supercharges ACCJ members’ networking opportunities with monthly meetings and unselfish teamwork.

In many sports, one player basks in all the glory of a score while another enjoys lesser accolades for their assist. Ice hockey spreads the wealth a bit more with a secondary assist—the pass before the pass that leads to the goal—and all three players earn a point in their stats.

This emphasis on teamwork is the same idea that forms the foundation of the American Chamber of Commerce in Japan (ACCJ) Sales Support Alliance (SSA). Founded in 2019 by Sales Development Committee Co-Chairs Eric Wedemeyer and Kjell Yadon, the SSA is designed to add value for committee members and guests by setting up the assists that lead to a business win.

Wedemeyer and Yadon describe their committee as horizontal rather than vertical as it serves ACCJ members across industries and company types. This broad reach amplifies the network effects and helps the SSA “supercharge everybody’s ACCJ experience.”

As an organization built on community and networking, the lifeblood of the ACCJ is serving up opportunities to its members. The SSA infuses this with the unselfish teamwork that leads to long-term success. Members introduce each other to new contacts in the hope that those fellow members will find business, even if there is no direct benefit to themselves—the pass before the pass that leads to the goal.

“In a networking situation, when you meet a new person at an ACCJ event, someone you know could very well be of use to the person you’re talking to, it becomes a richer experience if seen as an opportunity to introduce not just yourself, but also your contacts,” explained Wedemeyer. “If that results in a valuable business connection between two other people, that’s great. It’s a nice thing to do, it feels good, and the introduction will get paid back over time.”

J.R. Best, an SSA regular, found himself on the receiving end of an assist a couple of years ago. “David Clement connected me with the athletic director at [the American School in Japan],” said the co-founder of Hawaii-based Sports Camp of America (SCOA). “His daughter ended up being a junior counselor at SCOA’s summer camp, and she was fantastic.”

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“In a networking situation, when you meet a new person at an ACCJ event, someone you know could very well be of use to the person you’re talking to, it becomes a richer experience if seen as an opportunity to introduce not just yourself, but also your contacts.”

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SSA meetings regularly feature alternating small-group sessions and large-group discussions where attendees refine their self-introductions, sharpen their listening skills, and practice introducing other members to the group. This creates a feedback loop that allows attendees to reflect on their message and understand if their main point is coming across. For Japanese salespeople, it’s a chance to build confidence presenting in English in a comfortable, supportive, informal setting.

“By explaining my business to the people around me, I am able to look at myself objectively—what I am doing now, what I want to do, whether I am overreaching,” said Naoki Hioka, president of translation and localization company MedicaLingual, Inc. Hioka feels he has been able to identify issues and find the best path forward for his business thanks to SSA meetings.

Another feature of SSA meetings is the “Expert Corner,” where participants share knowledge and tips on a sales topic of interest. Recent topics have included using generative AI as a sales tool and post-Covid changes in lead generation strategies. Because SSA members represent so many different industries and job descriptions, these discussions generate an illuminating range of perspectives.

The name Sales Support Alliance might lead some to assume that only salespeople stand to benefit from the meetings, but Wedemeyer and Yadon stress that this is far from the truth. More than half of attendees are not in formal sales roles.

“Everyone is selling something,” said Yadon. “Many of our attendees are running their own companies or are responsible for promoting a company function internally. Sales skills always come in handy.”

Kreston ProWorks Business Development Manager Luc Swamika shared how he has benefitted from an introduction made at an SSA meeting. “Through the program, we forged a strong, lasting partnership and developed a mutually beneficial referral system that’s driving value for both our companies. Most importantly, we’ve built a relationship of trust and deep understanding with a valued partner.”

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“SSA meetings regularly feature alternating small-group sessions and large-group discussions where attendees refine their self-introductions, sharpen their listening skills, and practice introducing other members to the group. ”

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SSA meetings are open to non-committee-members, and usually half of attendees are first-timers. But once in the door, many get hooked and thrive on repeat attendance, building relationships over time.

Wedemeyer and Yadon describe the SSA as a momentum machine. Month to month, the results may look piecemeal, with people coming in with different sales targets and networking expectations. But over time, the SSA’s connections multiply as members get to know one another and build the trust necessary to make new introductions with confidence.

That momentum changed a bit during the coronavirus pandemic. Like most groups, productivity waned as meetings were forced to go virtual. Now, the Sales Development Committee is rebuilding the SSA as the in-person gathering it was before Covid-19. With more and more members joining, setting up the assist and scoring the winning goal is within everyone’s reach.

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The next SSA meeting will take place on May 22 in the American Room at Cambridge Innovation Center. If you enjoy the personal relationship building of business, or just want to get together to chat, the SSA is waiting for you.

Losing the Lag

Rob Claar’s quest to bring lifesaving innovations to Japan

Rob Claar became interested in healthcare at an early age. Watching his father work on the government-program side of insurance and talking to him about the industry, Claar came to understand some of the issues surrounding public and private systems. But as he entered Yale University to study art history, he did not envision a career helping healthcare innovators from the United States and elsewhere bring their lifesaving drugs and devices to Japan. A twist of fate, however, led Claar to become a champion of Japanese doctors, working to connect them with international peers and innovation.

Ahead of his presentation at a March 13 luncheon hosted by the American Chamber of Commerce in Japan Independent Business and Healthcare Committees, the HekaBio K.K. founder shares his journey from childhood in Detroit to Tokyo, where he helps companies gain regulatory approval for healthcare innovations.

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An extended version of this interview is available on The ACCJ Journal Podcast or by streaming from the audio player above.

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How did you get involved in healthcare innovation in Japan?

Claar: I came to Japan basically out of cultural interest. This was in 1987. I was 23, had just graduated from college, and decided that I wanted to see Asia. I was interested in the culture, art, and language, particularly of Japan.

I forced myself not to come to Tokyo to begin with. I thought Tokyo would be an easier place to survive with English, and I wanted to push myself to learn Japanese as quickly as possible. So, I landed in Nagoya and immersed myself in studying the language. I thought I was going to be good enough at Japanese after one year to move on to my next destination and call my Japan experience a success. That didn’t happen.

I was studying Japanese at the YWCA in Nagoya, and it was going very well. But, as you know, it takes a lot of time. After one year, I was still not where I wanted to be. I gave myself another half a year, and I started really enjoying being in Japan and speaking Japanese.

Then I got a job as a Japanese-to-English translator for Brother Industries and moved into their dormitory in Nagoya. They were setting up manufacturing operations in Malaysia and elsewhere, and I was translating manufacturing and line instructions. That was interesting and a good experience but, once I got good enough at Japanese, I decided it was time to either go home to America and start the rest of my academic career or go up to Tokyo and see what I could do. I decided to move to Tokyo and was lucky enough to get hired by a think tank called Sanwa Soken.

They were essentially a research arm for the government. The day after I joined, a huge project came in from the Ministry of Health. I was put on that project and got to learn all about the healthcare system. I traveled around Japan, met doctors, and began to understand how serious they are about patient care. I really started to fall in love with the idea of the Japanese healthcare system [and] how a national single-payer system can work wonderfully.

What did you discover that led you to want to help innovators?

Claar: As I met doctors, I began to understand their struggles. They wanted to be considered among their international peers as studying, researching, and being able to speak in an international forum on the greatest innovations worldwide. But their frustration was that their research was one generation too late in many areas. I became aware of the innovation lag and wanted to see what I could do to make an impact.

I realized that Japanese doctors struggle to get their hands on up-to-date innovations from around the world. There’s a lot of talk about drug lag and loss, and the same thing is happening on the device side, where innovations that are getting approved in the United States and Europe are not making it to Japan.

There are a few reasons for this, but I thought that if I could focus on how to help these very sincere, wonderful doctors in Japan, then that was going to be a way for me to potentially make a career here and have an impact on society.

So, I left Sanwa Soken to start my own company, Junicon. We would go around and interview doctors, and we found a way to sell those results to large pharmaceutical and medical device companies in Japan, Europe, and the United States.

I also started spending my spare time helping doctors translate their papers from Japanese into English so that they were better able to speak at international conferences. It was a minor thing, but being helpful to Japanese doctors is a way that I got into things and maintained those relationships.

What’s stopping overseas companies from entering the Japanese market?

Claar: Small companies are doing more and more of the true innovation around the world, and they have no bandwidth to start thinking about Japan. So, how do we get more innovative companies to think about Japan? That’s what we’re really focused on at HekaBio, and that’s my personal interest.

Japan is far away, and these companies don’t really know what goes on here. They have this outdated image that Japan is very hard to get into and the regulatory process is super opaque. They’re never going to get regulatory approval on their own, or they’re never going to form the right commercial relationship. I think this is a really outdated image of Japan that many companies have. We’re trying to help solve that. Our doctors and their patients are waiting for these innovations. We want to see if we can bring them in and arrange the capital.

The Japanese government is doing a great job right now with new programs that they’re introducing. They’re making clinical trials easier to get started and operate in Japan, both on the drug and the device sides. They’re welcoming first-in-human studies to be done in Japan, which has not been the case until recently. They’ve eliminated the requirement to have a Japanese principal investigator on international studies. And they’re also offering pricing incentives for programs that get submitted in Japan within a certain number of days or months of the submission in the United States. In some cases, we’ve had an approval in Japan before the United States, even though we started at the same time.

How many companies have you helped get regulatory approvals in Japan?

Claar: More than 50, including at our former subsidiary unit, which was a clinical research organization called Vorpal Technologies. We’re very proud to have been involved in getting those launched and into the market.

What is that process like?

Claar: At the beginning, we do market research. We want to confirm that the doctors who we want to be behind the program are really behind it. We’ll find out who has done the presentations and who has published how many papers in that area. Who’s in the medical society? Who’s on the board? All these different things. The worst thing we could do is partner with an overseas company that doesn’t have the health economics and an appreciation for the Japan system in mind.

Once we do that, and we understand the strength of the clinical data that the company has produced overseas—and whether the Pharmaceuticals and Medical Devices Agency (PMDA) will accept it as valid in Japan—then we start talking with the PMDA to understand the regulatory process [for the specific innovation]. Once we get buy-in from the regulators, then we go forward with the clinical trial. If no in-Japan clinical trial is required, which is often the case for devices, then we can just go forward to the submission and review period, which typically takes 12 months.

Sounds straightforward. Is there something else holding back innovation from overseas?

Claar: What remains is the question of reimbursement price. If companies have no idea until the very end what the reimbursement price is going to be, then it becomes difficult for them to want to invest the time and money. So, that’s part of the upfront market research that we do. What does a comparative product look like in terms of reimbursement? What can you expect, based on your experience in overseas markets, in terms of the ability for the Japanese health insurance system to pay?

If there’s no comparative product, if it’s a new category, then you submit your cost accounting information. The PMDA really wants to see everything in a very transparent way.

What we would like to see in Japan is more clarity. New categories, where nobody knows what the pricing is going to be, is a situation in the market that most people have to deal with. I think that if the government were able to give better guidelines up front, in a consultative process, and you could go to the Ministry of Health, Labour and Welfare and tell them what you are thinking about, more of the issues around the drug and device lag and loss could be solved. But they won’t give you anything in terms of a response with any responsibility associated with it. They’ll listen and tell you yes or no, but their answer is not a promise.

Japan’s healthcare system is the best in the world. I fully believe that. And we all have the responsibility to make sure that Japan’s great healthcare system can survive. We know that the government is fearful of healthcare costs growing. They’re looking for ways to cut the costs of [things such as] long-selling drugs, devices, and in vitro diagnostic tests. But we would like to encourage them to think more long term about some of the things that can be done in terms of digital health solutions for early diagnosis of particular conditions.

What opportunities do you see for ACCJ member companies? Can they replicate the success you’ve had?

Claar: Absolutely. And I hope so. I think we’ve come up with a great business model, and we’re happy for anyone to copy it, because we think it really works for bringing innovations into Japan.

HekaBio is focused, for the most part, on pharmaceutical and device interventions for acute illnesses, hospital treatments, and serious diseases. What we’re not working on are things such as chronic diseases, which are a huge burden on the healthcare system. [Monitoring] chronic diseases with at-home digital health [tech] would also work in our business model.

If somebody wanted to exactly copy our model and go right into exactly what HekaBio is doing in serious acute disease identification and treatment drugs and devices, then be my guest. We’ll be happy to have them [replicate] our business model with no worry.

But there are so many opportunities. For example, if they want to do something different, there are many new molecular entities, particularly for rare diseases. The PMDA has a list showing the status of those that are [only] available elsewhere. So, there’s no development risk, really, because you know that it works. It’s been approved in either the European Union or the United States, but it’s not available in Japan yet. Take one of those for a rare disease, buy the rights for Japan, and get it developed. You wouldn’t even have to build a big organization with your own infrastructure here. You could be a one-person company, get the rights, and then have a contract research organization do the clinical trial and be the in-country clinical caretaker on your behalf. Get it all through and then sell it to a pharmaceutical company once it’s done. That’s another business that could be not only very lucrative, but interesting and of societal benefit for Japan.

Charting the Course

ACCJ President Victor Osumi shares his thoughts on 2024 and the chamber.

Photos by Shelley Mae Photography

January 1 marked a change in leadership for the American Chamber of Commerce in Japan (ACCJ) as Victor Osumi, managing director and president of Japan operations for Delta Air Lines, Inc., was elected to guide the chamber in 2024.

Having served as a vice president last year, Osumi joined the board as a governor in January 2021 and has played an active role in chamber advocacy through the DC Doorknock visits to Washington and Diet Doorknock meetings with Japanese lawmakers.

The ACCJ Journal sat down with the former pilot at Delta’s office near Shiba Park to learn more about how his career took flight, how he became involved with the chamber, and the path he sees ahead as he takes the helm as president.

Tell me a bit about your background.

Growing up in a diverse, dual-culture environment, I spent most of my early years in Los Angeles, but I went to high school in Florida. My father was a Japanese expat. That’s what brought me to the United States. I also spent some time in school in Japan. I had dual citizenship, but Japan requires you to choose one by age 22. So, when I was 21 and joined the US Air Force, I chose to keep my US citizenship.

What led you to become a pilot?

I always had a passion for flying. After high school, I went to the Florida Institute of Technology and majored in aviation management, with a focus on flight technology and aeronautics. That led me to get my private pilot license, commercial pilot license, and flight instructor license.

I joined the Air Force because of this passion. I also thought that I could get a lot of flight hours, and that could create a path to joining a US airline as a pilot. But when my physical condition made it more difficult for me to fly, I got into management. Since I couldn’t fly, I decide to leave the Air Force.

Where did that course change take you?

When I shifted away from aviation, I joined a hotel company. That gave me experience in hospitality and an understanding of tourism, what it takes to be the best of the best when it comes to customer experience and service. I thought it would be for just a couple of years, but I ended up spending 27 years in the hotel industry.

That really gave me the backbone of where I am today. I gained knowledge through the financial side, customer service, and food and beverage. I also sat on the owner’s side of the property, which gave me additional insight into what a private equity company does, how they operate, and how they make decisions on investment in different countries.

Now, here I am back where my original passion lies: aviation and airlines. It took me a long time—almost three decades—but it came full circle.

How did you become involved with the ACCJ?

When I was assigned to Japan in 1998, I thought I would be here for five years and then I would go back to the United States. But I found that this country is where I belonged. At that time, most of the management at global hotel companies were American expats. They needed someone who could understand, speak, read, and write Japanese. And I thought that working in Japan for a global company gave me more opportunities for career advancement.

Ever since, either directly or indirectly, I have always been involved in chambers. I worked at Hyatt, then briefly with the IHG Group, and then twice at Marriott, which is a global, US-based company.

Being part of the ACCJ has given me a great opportunity to network and expand people-to-people relationships in the community.

Are there other career benefits you’ve felt from ACCJ involvement?

In the airline industry, we really value our relationship with the government, anywhere we go. I think it is the same for a lot of chamber members. They expect to have some type of advocacy dialogue, whether it’s with the US Embassy, the US government in Washington, or the Japanese government. We had a great opportunity in December during our Diet Doorknock to meet with lawmakers and officials to voice our mission and what we’re trying to accomplish.

And, of course, there is the education aspect. There are so many committees and forums at the ACCJ, and these offer great opportunities to learn more about a wide range of areas, from investment and finances to healthcare and pharmaceuticals—almost any area of business you can imagine. This has been a great experience for me.

Why did you decide to run for president?

It’s obviously a big commitment and will take a lot of my time. It’s a team effort. It’s not just me. At Delta, we value the presence of chambers commerce of commerce in each country. Particularly for Japan, the Atlanta headquarters recognized the importance of being part of the ACCJ and the value in me serving as president.

Of course, I have big shoes to fill following Om [Prakash]. But again, he and I are both ex-military, so he always said that I was second in command. Last year, when there were some times when he was not able to be present, I took the controls in a way. And having had that opportunity really helps smooth this transition for me, I feel.

Why is 2024 a special year?

It is the year of the dragon, but not just any dragon. Each of the 12 animals in the Chinese Zodiac has five types associated with the elements. This year’s dragon is the wood dragon, called kinoetatsu in Japanese. It only comes around every 60 years. The last time was 1964, when the Olympics were held in Tokyo, the shinkansen began operations, and I was born.

Kinoetatsu means this is a year when the energies of growth and adaptability associated with the element of wood in Chinese Wu Xing philosophy combine with the dragon’s qualities of power, prosperity, and transformation.

What do you see as the key initiatives and advocacy points for 2024?

My vision for the ACCJ this year centers on three main areas:

• Fostering partnership
• Embracing progress
• Bridging the future with excellence

The Indo-Pacific Economic Framework for Prosperity (IPEF) is an area I feel is especially important. It is key not only for Japan but the Asia–Pacific region, and the ACCJ must continue to be part of the discussions around IPEF.

Of course, diversity, equity, and inclusion will remain important, as will sustainability and cross-border investment.

One I see as especially big, as it impacts all the others, is digital transformation. Not just “going digital” as some people might see it, but the many aspects that can impact industries. In transportation, for example, one of the biggest issues is the free flow of data across borders. This would allow us create things such as paperless passports, with face-recognition technology used to ensure security. But there are still issues to resolve so that the US side has full confidence in Japan’s data security.

And as we talk about economic security, I think that data is going to be one of the biggest parts to bringing about economic security. It has tremendous value. But we need an agreement between the Ministry of Economy, Trade and Industry and the US Department of Commerce to make sure that we have cleared out the trust issues that impact digital transformation.

How important has US Ambassador Rahm Emanuel been to ACCJ advocacy?

We were missing an ambassador for almost three years. We always have great representatives and support from the US Embassy, but when Ambassador Emanuel arrived, he hit the ground running. He has been a tremendous help to the ACCJ and Japan. We really needed somebody like him to represent the United States in the Japanese community. I have very high respect for Ambassador Emanuel.

When he arrived, two years into the Covid-19 pandemic, there was pressure from many areas and organizations to get the borders reopened. The ACCJ played a part in making this finally happen, and Ambassador Emanuel and his staff were key. The chamber was able to speak up and serve as a conduit between our members and the Japanese government, and also the US government to get their help as they pushed from their end.

Ambassador Emanuel also visited Chubu last July in support of efforts to resume flights from the region to the United States. He met with ACCJ members from our Chubu Chapter and area leaders that included Aichi Governor Hideaki Ohmura, Nagoya Mayor Takashi Kawamura, and Riki Ishizuka, president and chief executive officer of the Chubu Centrair International Airport.

These are not only examples of his effectiveness, but how both the US and Japanese governments value the ACCJ’s voice.

What else would you like to say to members?

As we continue our celebrations to mark the ACCJ’s 75th anniversary, one thing I would like to ask is for everyone to help grow our membership. Word of mouth is very important. So, if there is someone you feel is a potential candidate for membership, please let me know.

Related to this is finding ways to make the chamber even more appealing. Advocacy, education, networking, and dialogue with the US and Japanese governments are important. If you have ideas for making these more effective, I would love to hear them.

Let’s work together to make 2024 a great year and the ACCJ’s presence bigger than ever before.

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Synthetic Savants

As generative AI sweeps the world, how will it transform the way we work and innovate?

We live in an age of intelligent machines. Since the introduction of consumer-facing artificial intelligence (AI) applications such as OpenAI’s ChatGPT and Google’s Bard over the past year, generative AI has transformed how people work around the world.

From $40 billion in 2022, the market size for generative AI will balloon to $1.3 trillion over the next 10 years, according to Bloomberg Intelligence. First popularized through image generators, the technology has been applied in fields ranging from neuroscience to advertising, sometimes in surprising ways.

Generative AI programs like the large language models powering ChatGPT are trained on enormous volumes of data to sense patterns and predict how they will play out in a piece of content. These models can be trained on linguistic, financial, scientific, sensor, or other data—especially data that is uniform and structured—and can then create new content in response to user input. They have had remarkable success, particularly in image and text generation, and have seen rapid uptake in sectors ranging from education to computer programming. “This technology is set to fundamentally transform everything from science, to business, to healthcare … to society itself,” Accenture analysts enthused in a report. “The positive impact on human creativity and productivity will be massive.”

Powerful New Assistants

Generative AI first gained public attention thanks to its ability to change how we communicate through words, images, and video. It’s no wonder, then, that the world’s largest public relations company has embraced it. Edelman worked with OpenAI to launch the original ChatGPT-2 and delivered the first application in an ad campaign. In the spots for Hellmann’s Mayonnaise, the tool is tasked with finding new ways to use leftovers.

Edelman believes the technology will reconfigure the communications industry, but it won’t replace human ingenuity, strategic advice, and ethical decision-making that builds trust, said Meghan Barstow, president and representative director of Edelman Japan.

“We predict that AI will become an essential assistant in our work, helping to brainstorm, research, summarize, trend spot, monitor media, and generate content, among other tasks,” explained the ACCJ governor and chair of the chamber’s Communications Advisory Council. “The emphasis here is on ‘assistant,’ as we believe there will always be a human in the loop, that AI and people working together will provide the most effective and valuable work output.

“As with any technology, there are risks that require appropriate caution, education, processes, and policies to ensure the safe and trustworthy use of generative AI to protect our work, our clients, and end users from issues related to disinformation, bias, copyright infringement, and privacy.”

Similarly, lawyers such as Catherine O’Connell are also using generative AI as smart assistants. O’Connell is principal and founder of Catherine O’Connell Law and co-chair of the American Chamber of Commerce in Japan (ACCJ) Legal Services and IP Committee.

After taking a course on how to get the most out of ChatGPT, she has been using it for writing keynote speeches, article outlines, posts on social media, and skeletons of presentations. She compares the tool to a human intern, and praises its time-saving efficiencies, but warns that it should not be used for legal work, such as contracts or legal advice. Attorneys in the United States, she noted, have found themselves in trouble after producing legal filings referencing non-existent cases that generative AI simply made up.

“Generative AI is like a teenager that has a lot of promise but has not learned how to be a whole professional yet; it needs guidance,” said O’Connell. “However, in terms of an idea generator or idea expander, a time-saving device, and an assistive tool, generative AI is an asset. The rest falls to me to add my human touch to check and verify, to add my own personality and insights only I have, and to make the output my very own. I think generative AI is so good that its cousin, Google search, may be out of a job sometime soon.”

Smart Tools for Talent

Recruiting is another industry in which workers deal with mountains of structured data, in the form of resumes and online posts, that can be utilized by AI. Robert Half Japan, an ACCJ Corporate Sustaining Member company, uses a system called AI Recommended Talent (ART) to match resumes to client needs. The system speeds up matching for job hunters and employers, allowing staff to spend more time with clients.

“The real power of generative AI is how much it can integrate with our existing systems,” explained Steven Li, senior division director for cybersecurity. “We are piloting ChatGPT-4 integration in our Salesforce CRM. Studies have shown benefits from integrating generative AI into workflows. Other industry examples that highlight the benefit of integration include the GitHub CoPilot generative AI feature.”

The effectiveness of AI in recruiting has led some people to speculate that it could render many human recruiters obsolete. Deep learning algorithms are figuring out what a good resume looks like, and generative AI can craft approach messages and InMails, a form of direct message on the popular LinkedIn platform, noted Daniel Bamford, Robert Half’s associate director for technology.

“However, the real value of agency recruitment is not, and never was, a simple job-description-to-resume matching service,” added Bamford. “Agency recruitment done well is a wonderful journey of problem-solving, involving the goals of organizations and teams and the values and desires of individuals. Excellent recruiters will thrive. They will use AI’s capacity to handle simple tasks like scheduling and shortlisting. This will free up time for high-value interactions, delivering even greater value for their partners and industries through the human touch. The future of excellent recruiters will be brighter with AI’s support.”

Tracking Ships and Patients

Even a traditionally hardware-oriented industry like logistics is being transformed by generative AI. Shipping giant Maersk is using a predictive cargo arrival model to help customers reduce costs with more reliable supply chains. It also wants to harness the power of AI to recommend solutions when shipping routes are congested, advising on whether goods should be flown or stored, and better understand the sales process, Navneet Kapoor, Maersk’s chief technology and information officer, told CNBC.

Maurice Lyn, head of Managed by Maersk for Northeast Asia, also sees great potential in the technology. “The biggest changes that I foresee will be related to the enhanced visibility into, and agility of the management of, the global supply chains of our clients on an execution level,” he told The ACCJ Journal. “The data aggregated will allow logistics service providers [LSPs] to deliver predictive and proactive solutions to our clients. If clearly interpreted by the LSPs, stability and uniformity of costs and deliverables will be provided globally and locally to our clients.”

Generative AI may even help us live longer, healthier lives via long-term patient monitoring. Sydney-based medical AI startup Prospection recently launched its first generative-AI model in Japan to analyze anonymized patient data for pharmaceutical companies so they can better understand patient needs. A Japanese drug company, for instance, could look at cancer patient outcomes across the country and find that they are slightly worse in a particular region, possibly because less-effective drugs are prescribed there.

Founded in 2012 and operating in Australia, Japan, and the United States, Prospection now has data on half a billion patients. For the first 10 years, it was using traditional AI methods, but generative AI has opened new services for the company. Users can query Prospection’s AI services about typical pathways for patients who took a certain drug, or what therapy they underwent after quitting the medication. A Prospection model can predict whether a patient will experience a certain event, such as needing to be hospitalized, over the next year.

“The ChatGPT transformer model is trained on billions of sentences consisting of words. We see each patient’s journey as the sentence and events in the journey as the words. That’s the vocabulary,” said Eric Chung, co-founder and co-CEO of Prospection. “The data is very powerful. There are lots of insights to be gained from data on 500 million patients. It’s beyond the power of humans to analyze, but AI can do it.”

Renewable Ambitions

Japan aims to mix up power, but are the targets achievable?

Japan has detailed ambitious plans for the wider deployment of renewable energy sources throughout the economy, with the government in October 2021 announcing the Sixth Strategic Energy Plan and setting a target of between 36 and 38 percent of the nation’s power coming from renewables in 2030.

That would be about double the 2019 level and significantly above the previous 2030 goal of up to 24 percent.

Japan’s target renewables mix would include up to:

• 16 percent from solar
• 11 percent from hydropower
• 5 percent from wind
• 5 percent from biomass
• 1 percent from geothermal

The contribution from nuclear energy was left unchanged, at between 20 and 22 percent. This will require a minimum of 30 reactors to be operational.

The targets tie in with the Clean Energy Strategy, unveiled by the government in May 2022, announcing an ambitious 46-percent reduction in greenhouse gas emissions in fiscal 2030 and carbon neutrality by 2050.

And, given the impact of instability involving Russia and in the Middle East, the two traditional primary sources of energy for Japan, combined with the yen at 10-year lows against other leading currencies, it would be in Japan’s best interest to dramatically reduce its reliance on imported energy.

Yet energy experts caution that Tokyo is unlikely to reach those targets as progress in the development of renewables has slowed, with fewer large-scale solar projects, delays in offshore wind generation, and local resistance hampering the acceleration of other technologies, such as onshore wind and geothermal power.

“Private capital markets are ready to invest in Japan, and both multinational and Japanese firms have developed technology and human resource pools to hit targets,” points out Andrew Statter, a partner at the Titan Consulting Group and head of its GreenTech division.

“However, policies and subsidies are unclear, and there are conflicts between ministries that are causing questions for investors while potentially profitable asset types, such as large-scale agrisolar, are not yet eligible for project financing,” he told The ACCJ Journal. “All of which puts a huge pause on the potential accelerated development that industry is ready to deliver.”

Japan needs to go beyond the “what” in its policies and clarify the “when,” “where,” and “how” to encourage investment, Statter said.

Favorable Winds

Turning to specific energy resources, Statter said offshore wind is critical as Japan has geographical and physical limitations on the volume of onshore renewables that can be developed. “With vast ocean resources, offshore wind is the ideal renewable technology which is proven and scalable to give Japan a shot at hitting renewable energy targets,” he said. “Key here is the need to accelerate floating offshore wind, as Japan’s waters become very deep quite close to shore.”

Statter also sees a secondary benefit to Japan’s expansion of floating technology. The country could become a technology exporter on a regional scale as Asia–Pacific markets embrace the technology.

Akira Amano, country manager of Invenergy Wind Development Japan GK, agrees on the importance of offshore wind to the nation’s overall energy goals, pointing out that “Japan has the right resources to become a global leader in renewable energy, especially offshore wind.”

He also concurs that significant challenges need to be navigated for the renewables sector to thrive.

“In order to accelerate progress and meet our nation’s goals, there will need to be long-term regulatory certainty, increased transmission capacity to deliver energy to customers, and long-term planning to address challenges like cost uncertainty.

Amano also noted that, with strong leadership, Japan can accelerate the build-out of clean energy and meet its energy goals in a timely manner.

Rocky Foundation

If the authorities are serious about making the most of offshore wind, Amano said, a number of regulations need to be revised, not least the unbundling of generation, transmission, and distribution at existing electricity utility companies to get rid of unfair competition. The sector also needs the authorities to increase the price for renewable energy certificates, he added.

Hideyuki Ohnishi, regional general manager for GE Renewable Energy in North Asia, agrees that Japan needs to make the most of its exclusive economic zone—one of the world’s largest—for offshore wind.

“The wind conditions, the speed and quality of the wind, is much better when you go to the seaside,” said Ohnishi. “In the mountains, there is turbulence and such, and average wind [speed] is not as strong. So, it is important for us to go to the places where we have better wind.”

Yet there are challenges, particularly in laying the foundations for turbines.

“We have to install big wind turbines in the sea, where the depth differs,” he explained. “Wave and seabed conditions have an impact. The geosurface is very important. Rocks and related conditions impact our design, and it’s not easy in terms of technology.”

Equally, the investment required to get the blades turning is significant, and projects must be considered in the long term.

The Japanese government is also pushing for 60 percent of the components in offshore wind farms to be manufactured locally.

General Electric started working with Toshiba in 2021, initially focusing on the nacelle at the top of the tower that houses all the critical components of the turbine. Construction of the nacelle is now largely done by local labor and with components utilizing the local supply chain, all of which will have a long-term benefit for the community, Ohnishi added.

Lofty Aims

While the government’s 2030 targets can be achieved as battery storage and grid technology improve, in tandem with innovations in the use of the grid, the 2050 targets are “a real moonshot,” Ohnishi admitted. “The 2050 goal is very, very challenging, but a majority of us have agreed to aim for it,” he said.

The Japanese government has also been a vocal advocate of hydrogen as an effectively limitless source of energy in the future, although questions are being asked as to whether this is the most appropriate path.

“Generally speaking, I think the industry and international impression is that Japan’s hyper focus on hydrogen to solve all problems has been outsized and unrealistic,” said Ken Haig, vice-chair of the ACCJ Energy Committee. “It is also too future-focused, relying on technologies that will not become commercially viable or scalable until well after 2030.”

Haig noted a comment made by former ACCJ President Glen Fukushima in a recent Kyodo News opinion piece: “Japan’s support for innovation in green hydrogen, perovskite technology, and offshore wind is the right move,” said Fukushima, “But METI should take a ‘yes, and’ approach by also immediately boosting funds to deploy existing clean energy technologies like solar and wind power—technologies that have already proven successful for Japan.”

Whatever the source, the renewables sector agrees that Japan’s need for home-grown energy is only going to intensify. The Sixth Strategic Energy Plan is billed as a rethink of regulations that have thus far inhibited development; for developers, the elimination of red tape cannot come soon enough.

2022 Person of the Year: Akio Mimura

The ACCJ honors the Japan Chamber of Commerce and Industry honorary chairman for his enduring support of international businesses in Japan.

Photos by Miki Kawaguchi/LIFE.14

From left: ACCJ Executive Director Laura Younger, Akio Mimura, and ACCJ President Om Prakash

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On November 9, 2023, the American Chamber of Commerce in Japan (ACCJ) recognized Akio Mimura as the 2022 ACCJ Person of the Year. He was chosen for his efforts to bring the Japanese and international business communities closer together during his nine years as chairman of the Japan Chamber of Commerce and Industry (JCCI).

The person of the year is normally honored in spring, but this year’s event was delayed due to the coronavirus pandemic.

During a special luncheon at The Place of Tokyo, the former chairman and president of Nippon Steel Corporation spoke about his long career.

The event began with a VIP session where ACCJ leaders greeted Mimura, after which ACCJ Executive Director Laura Younger welcomed guests and provided background about the award. ACCJ President Om Prakash delivered remarks and invited Mimura to the podium.

“I am truly honored to be nominated as the 2022 ACCJ Person of the Year, because 2022 was the year I concluded my 60-year business career, 51 years in the Nippon Steel Corporation and nine years as the chairman of the JCCI,” Mimura began.

“The last nine years have been especially worthwhile periods in my life,” he continued, noting that the coronavirus pandemic, during which he closed out his time as JCCI chairman, required action and guidance to protect the most vulnerable people and businesses, especially small and medium-sized enterprises (SMEs).

“I devoted my energy to three initiatives,” explained Mimura, who requested:

• Balanced measures to contain Covid-19 that allow free economic activity
• All possible measures from government to ensure that businesses survive
• SMEs use the pandemic as a wake-up call and promote self-reformation

“Luckily, Covid-19 is finally coming to an end, and most SMEs were able to preserve their business continuation,” he said. “Overall unemployment in Japan was kept very low, at 2–3 percent. Our real challenge is to position this pandemic and the worldwide inflation as a turning point, and to rejuvenate the Japanese economy, which has been stagnant for the past quarter century.”

Mimura shared that another great memory is encountering the philosophy of Eiichi Shibusawa. Born in 1840, Shibusawa played a key part in business development during the Meiji Period (1868–1912) and is often referred to as the father of Japanese capitalism.

“He was involved in the founding of 481 companies and played an active role in the launch of 600 social contribution institutes. Can you believe it?”

The latter especially resonates with Mimura.

“In recent years, I have been very heartened to see the increasing global interest in [strategic development goals] and stakeholder capitalism,” he said. “However, I have personally felt dissatisfied with the fact that this interest often remains only on the surface, limited to general overviews or investor-related presentations without translating into concrete actions.”

Shibusawa, he notes, insisted earnestly that business leaders should pursue profit but also contribute to the public interest, namely by enriching society and making people happier.

“He was not only a person of action but also a visionary leader,” Mimura said. “We business leaders must somehow achieve the harmony of private and public interests in our own way.”

Equal Partners

Five years in, the ACCJ’s campaign for marriage equality gains speed.

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In September 2018, the American Chamber of Commerce in Japan (ACCJ) released a viewpoint entitled Support the Recruitment and Retention of Talent by Instituting Marriage Equality in Japan in collaboration with the Lawyers for LGBT & Allies Network (LLAN) and five other chambers of commerce. Five years later, the viewpoint has been endorsed by 139 domestic and international entities.

Across Japan, support for marriage equality is gaining momentum among the population, with 278 municipalities and prefectures now offering same-sex partnership registration. This includes the Tokyo Metropolis as well as major cities such as Sapporo, Osaka, Kyoto, and Fukuoka.

Traction can also be seen in the general population, with surveys indicating support for marriage equality of 44 to 82 percent, with stronger support among younger people and women.

Yet calls for marriage equality continue to fall on deaf ears in the Diet.

“This year, we did have the very first LGBT legislation, the ‘awareness bill,’ so that domino has fallen,” said LLAN co-founder and co-chair Alexander Dmitrenko. He noted that the watered-down language does little more than say, “Please be aware there are gay people out there.”

But there are ways to influence the national government, he said.

“One way is to really work with local governments to ensure that, to the extent they can support recognizing equality, they do it.”

Some prefectural governments, he said, have made strong efforts to afford greater rights to same-sex partners.

Dmitrenko said the LGBT community is very grateful for this, but warned that, when talking about this progress, “we need to be very careful not to dilute focus on the actual goal, which is equality. These move us a small step closer, but they’re not equality.”

A second way, he explained, is through the courts.

The impact of the ACCJ viewpoint can be seen in litigation efforts. In 2021, Sapporo District Court Judge Tomoko Takebe referenced the ACCJ position in a case brought against the government by three same-sex couples. Takebe ruled that prohibition of same-sex marriage is unconstitutional, but denied demands for compensation.

There have also been favorable outcomes in Tokyo, Nagoya, and Fukuoka. The message from the first-level courts was that there’s definitely discrimination. And, like Sapporo, these cases also referenced the ACCJ viewpoint.

“But ultimately, court cases, unlike in the US, can’t change the law. Only the Diet can,” Dmitrenko explained. “Yet, those cases create important pressure points.”

Growing support from Japanese corporations is also helping move the needle. The Business for Marriage Equality campaign had the support of 458 companies and organizations as of December 8.

The ACCJ issued an open letter to the government on April 21 stating the business case for marriage equality and protection of LGBTQ+ rights, and will soon release an updated viewpoint. Both can be viewed on the ACCJ website. Any company can endorse the viewpoint by contacting info@llanjapan.org.

Dmitrenko is confident that Japan will eventually join its G7 partners in recognizing same-sex marriages.

“It’s a very slow, local train to equality, making all the stops, getting everyone on,” he said. “Which is fine. Just a little faster, please.”

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Innovation Engine

CIC co-founder Tim Rowe shares his entrepreneurial journey and vision for collaboration in Japan.

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Like so many new graduates, Tim Rowe and his friends from the Massachusetts Institute of Technology (MIT) left their Cambridge campus with diploma in hand and took “ordinary” jobs. A few years later, in 1999, they quit those jobs to build
start-ups.

But they needed offices—not the easiest thing for young entrepreneurs to pay for in a town that’s home to two of the world’s most prestigious universities. So they decided to share a space near MIT and Harvard to lighten the financial load. At least one of their companies would make it, they thought.

The shared space led them down an unexpected path, however, as more companies moved in and they went from five to 10 to 50 to 100. The Cambridge Innovation Center (CIC) was born.

Fast forward two decades and CIC opened its first Asia facility in Tokyo, in the Toranomon Hills Business Tower. The ACCJ Journal sat down with Rowe in the bustling networking hub to learn more about how he went from sharing a space with friends to leading a community for entrepreneurs that includes more than 1,000 companies at centers in eight cities around the world.

How did CIC expand?

For the first 13 years or so, we just grew right there in Cambridge. I had little kids at the time and didn’t really want to travel as much. And Cambridge is an amazing place for start-ups. So, we just kept taking more space and filling it. It was really kind of a surprise to us. We didn’t set out to build a shared space for start-ups as a business. We were actually just
using it for ourselves.

My mother had been the ombudsman at MIT, and one of her friends who had been the provost of MIT, Mark Wrighton, had become the chancellor of Washington University in St. Louis, one of the top medical schools in the United States. She said, “Mark called and wants you to come to St. Louis.” I was about to give all the reasons why I didn’t know if I could do that, but then she was like, you gotta go. Okay, Mom. So, I flew to St. Louis and met with Mark Wrighton. He said, “Look, we want you here, and we’re going to help you figure it out.”

One thing led to another and we opened in St. Louis. A few years later, the federal government was looking for a home for the National Geospatial-Intelligence Agency, and they toured St. Louis. They came to our center and said this is the kind of vibe they were looking for. They actually testified before Congress that they selected St. Louis because of their experience at our center. It was a $2 billion investment, a big deal for the local economy. After that, as other people came and knocked on the door, we said, “Sure, let’s look into it.”

How has the view of start-ups changed?

If you survey new college graduates, they often say the number one thing they want to do is go create a start-up. I think it’s good for the world, because what we’ve learned is that innovation has the power to make the world better in so many ways. But what we’re finding is that innovation gets into the world, is adopted and spreads much more quickly, through new enterprises rather than existing ones.

When we’re part of a larger organization, we want to respect all the rules that exist in that organization. Doing new things becomes rather hard. We hear things such as, “We tried that once and it didn’t work,” or “That sounds interesting, but that’s 1/1,000 of the revenue of this company, so we can’t prioritize it.” That’s normal, and it’s been well studied. But the bottom line is that existing enterprises find it very difficult to introduce true innovation.

“They understand that it’s not about them so, when there’s something really new and interesting that they have in their company, they push it out. It’s like asking your teenager to move out of your house. It’s time now, it’s time to go off.”

I think the smarter of the big organizations understand this. They understand that it’s not about them, so, when there’s something really new and interesting that they have in their company, they push it out. It’s like asking your teenager to move out of your house. It’s time now, it’s time to go off. They do the same thing and take those teams and move them out of headquarters.

Why did CIC choose Japan?

There’s a personal reason and there are professional reasons. The personal reason is that, in my youth, my dad said that if I studied Japanese for a while he would help me get an internship here. And my grandmother spent about 10 years in Asia in her youth, in the 1920s—mostly in China but some in Japan—and she taught me kanji when I was a kid. That all got me interested in Japan, and I was fortunate to do an internship here during high school.

Professionally, if you look at the most successful companies in the world—and you can use any measure, but one would be the Russell 2000 Index—all those companies were at one point start-ups. So, another way to look at that list is that it is a list of the 2,000 most successful start-ups ever. When you break them down by country, you find that the United States and Japan tie for the number of companies on the list adjusted by population. So, historically, Japan ties for number one as a place to build start-ups. That’s a reason to be here.

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Photos: ©CIC Tokyo

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Is the Japanese government doing enough to support start-ups?

Building a start-up ecosystem is a decade-long process. A piece can come from a supportive government, and it’s really terrific that the Japanese government is leaning in. Other governments that have leaned in, such as Israel, have done really well. It’s clear that a national policy that pushes in this direction can pay big dividends.

But it’s not the only thing that needs to happen. You also need the entrepreneurs themselves. And I think the Japanese innovation ecosystem is responding. These days, if you talk to young Japanese people—and this is a change, perhaps just like what started to happen a decade ago in the United States—you see many more who say they want to build a start-up.

I see Japanese universities leaning into this, which is important. They’re doing entrepreneur programs like those US universities started a decade or more ago. I see a growing awareness of, and interest in, what we call innovation infrastructure. This is things such as shared wet laboratories, the physical infra-structure that allows for new start-ups in, let’s say, the biotech field.

We’ve built shared workspaces focused on a number of industries. The largest so far is the wet lab for life sciences. We collaborated with others to found a nonprofit doing that in Cambridge. It’s called LabCentral and is, as far as we are aware, the largest shared wet lab on the planet. It’s over 20,000 square meters and has every possible piece of equipment you would need in life sciences. Then we figured out how to make that commercially viable and built a similar facility, a commercial one, called CIC Labs in Philadelphia. It’s the largest commercial shared wetland facility in the world, to our knowledge.

How can Japan and the United States work together?

The good news is that the interests are very aligned for Japan, for the United States, for Japanese companies, and for US companies in Japan. Everyone in this circle benefits when they figure out how to get these collaborations to work well, and set a different way.

If you aren’t out there working with new technologies, which are often coming from start-ups, then you’re at risk that you’ll be Airbnb’d or Uber’d. You’re in the hotel business and someone figures out another way to have lodging. You’re in the taxi business and someone figures out another way to get people around the city.

“If you aren’t out there working with new technologies, which are often coming from start-ups, then you’re at risk that you’ll be Airbnb’d or Uber’d.”

This is core to the ACCJ itself. Really, what you’re talking about is brokering conversations. You’re getting people to know each other and to talk about what they’re doing, and how they might help each other.

When I was a young person at the Mitsubishi Research Institute in the early 1990s, I was a member of the ACCJ, because I saw—and I convinced my bosses—that the connections that could be made were meaningful and important. I think it’s no less relevant today. And I think that, as many of these companies have evolved, one of the things they’ve come to realize is that, while the connections between larger organizations are important, the connections between larger organizations and smaller fledgling ones are also important. The challenge is figuring out how to find those little companies and how to know which ones to work with.

What’s next for CIC in Japan?

We were approached by Nishitetsu, the major private railway company in Kyushu. They said, we like what we see at CIC Tokyo and we’d like to work with you to build another one in Fukuoka. We have announced that we’re in a formal collaboration and will soon finish all the due diligence to make sure this will really work. Then we can announce if, in fact, we’re moving ahead with construction, but it’s looking very good and we’re excited to be headed to the second site.

We’re also in several conversations about building some of those shared wet laboratories, robotics laboratories, and other kinds of deep tech shared spaces here in Japan.

We’d love to hear from Journal readers on this; if they have ideas, they should let us know. We think there’s a lot of demand for this kind of innovation infrastructure. Not only does it propel start-ups, but it also creates an environment much like CIC Tokyo does, where larger companies can interact with, and find interesting, smaller companies. Those are our two main areas in the future: more in deep tech and more locations around Japan.

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Healthy Makeover

How are digital transformation tools changing healthcare in Japan?

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ChatGPT, that large language model that is stealing the headlines these days, may be all the buzz, but it’s just one example of how technology is rapidly changing the way we work and do business. And while the artificial intelligence (AI) bot may represent a leap forward, the deployment of digital technology across an organization’s operations has been on the rise in all industries since the advent of the World Wide Web in 1989.

Today, we call it digital transformation (DX), and it is bringing computation, Big Data, AI, other digital applications, as well as connected devices, to bear on how products and services are made and/or delivered, in industries as diverse as education, finance, and logistics.

Healthcare could also greatly benefit from these incredible advances, and the industry is undergoing its own DX revolution—including in Japan. Here, healthcare DX is gaining traction in part due to the advocacy efforts of the American Chamber of Commerce in Japan (ACCJ).

However, speaking to The ACCJ Journal, industry insiders—including members of the chamber’s Healthcare Committee—note that adoption of healthcare DX in Japan lags that of other countries, especially those in North America and Europe.

“I think the current situation is that [Japan is far behind] compared with countries such as Denmark or the United States,” said Makoto Kawai, director of government affairs at Zimmer Biomet G.K., a global medical technology company. Kawai is also co-chair of the ACCJ Healthcare Committee.

Maya Mamiya and Diogo Rau share similar sentiments. Mamiya is an associate director of global public policy for Asia at Eli Lilly Japan K.K. and a Healthcare Committee vice-chair, while Rau serves as Eli Lilly’s chief information and digital officer.

Also sympathetic to Kawai’s view are healthcare industry expert and committee Vice-Chair Eiji Sasahara, and Go Ikeda, a senior manager in the Healthcare Economics and Government Affairs Division of medical devices maker Medtronic Japan Co., Ltd.

Data Utilization

Dr. Sasahara noted that healthcare DX in Japan—especially optimal utilization of Big Data—is still low. Why? It is in large part because “operations heavily depend on manual and paper-based processes,” he explained. “It’s not easy to utilize [the] merits of digital technologies, such as accessibility, scaling, and automation.”

However, optimizing Big Data use in healthcare is important for a variety of reasons. One area where its effective deployment is critical is in determining the health outcomes of patients, the experts pointed out.

Rau identified even more areas where optimal use of DX tools can make a difference. In the case of Eli Lilly, Big Data, AI, and machine learning can be used to:

• Develop digital connectivity for clinical trials and therapeutics
• Deploy solutions to manage patient-specific digital information
• Speed up the discovery of new life-changing medicines
• Design and implement clinical trials
• Increase accessibility to and diversity of medicines
• Obtain more accurate efficacy/safety data
• Improve patient experience
• Improve the safety and effectiveness of medicines
• Manage and interpret patient data from connected therapeutic devices

Medtronic’s Ikeda agrees. “In order to link personal health records [(PHRs)] and medical information, it is necessary to build a platform and take measures to shift data ownership and management to individuals,” he explained.

“By connecting and sharing data such as PHRs and medical information, the value of medical care will be improved, allowing for early diagnosis and prevention of disease progression.”

“By connecting and sharing data such as PHRs and medical information, the value of medical care will be improved, allowing for early diagnosis and prevention of disease progression.”

To provide better healthcare while maintaining universal access, the current fee-for-service health insurance system should be shifted to value-based healthcare (VBHC), Ikeda suggested. “DX of healthcare is an important precondition for VBHC.”

Sasahara refers to this new paradigm as “citizen-centered care”—a form of healthcare that not only makes use of digital tools such as Big Data, but also puts patient outcomes at the core of the industry.

Healthy Prices

The upside of deploying healthcare DX can be enjoyed not only by patients and the private sector, but the public sector, too, the experts noted.

Government ministries and agencies—as well as the hospitals and other healthcare institutions and research and development (R&D) centers they fund—will be able to reduce costs through the effective deployment of DX strategies.

Ikeda noted: “DX will promote R&D and enable outcome-based reimbursement evaluation, supporting a reduction of medical and nursing care costs. It can also support the healthcare workforce shortage [to] benefit patients overall.”

Data Security

Improving data security is another benefit the DX revolution will confer on the healthcare industry, according to the experts. This is especially the case when securing the privacy of patient records, an area of concern many of them highlighted.

Healthcare DX, they said, should adhere to international standards of security. These standards are based on interoperability of systems and use of platforms such as cloud computing. In Japan, however, patient data is usually stored on premises and in stand-alone systems, which are not necessarily secure.

“With regard to data storage, the current mainstream on-premises, stand-alone system has increased security risks, and it should be considered that an open mechanism using the public cloud paradoxically improves security,” explained Ikeda.

Lilly’s Rau added: “Some of the key concerns include ensuring the confidentiality of this data when tied to a patient and the integrity of the data when billing and making care decisions.”

Sasahara agrees. He also noted that, in Japan, there is a lack of in-house security expertise. “It is usual that there is no [chief information security officer] at Japanese hospitals.” Kawai held a similar view.

However, this opens up an opportunity not only to acquire the necessary human resources but also to “develop and utilize emerging privacy-enhancing technologies,” Sasahara and Kawai agreed.

Securely digitizing patient records will be key to realizing the potential of healthcare DX.

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Prevent and Cure

The reach of healthcare is broad. It includes the prevention, diagnosis, and treatment of diseases, injuries, and ailments, and encompasses a wide area of professions and fields—from doctors to nurses to medical researchers—as well as facilities such as hospitals, clinics, and research institutions.

In the healthcare technology space, a few themes are emerging at the forefront. For Ikeda, three areas of particular note are:

• Grand design
• Value assessment
• Private–public partnership (PPP)

Regarding the path to implementation, Ikeda shared: “We believe that it is necessary to first illustrate a grand design for the overall picture of what the platform should be in order to realize medical DX, and then the process for building that overall picture should be presented.” It is the remit of the government, working with stakeholders across society, to provide that grand design or vision, he added.

“DX will promote R&D and enable outcome-based reimbursement evaluation, supporting a reduction of medical and nursing care costs. It can also support the healthcare workforce shortage [to] benefit patients overall.”

As for value assessment of digital health technology, Ikeda noted that this is difficult to properly assess under existing medical service reimbursement systems.

“To reduce the burden on medical professionals, as a new evaluation perspective unique to digital health technology [emerges], to equalize and improve the efficiency of technology, and to evaluate products that match the speed of product development and improvement, it is necessary to build a new evaluation system by referring to overseas cases and the utilization of non-insurance combined medical care systems,” he explained. Here, stakeholders in Japan and abroad can learn from each other.

And what of private–public partnerships? To enhance PPP, Ikeda added, it is also necessary to set up new forums for information sharing and discussion among the public and cross-cutting private sectors. “I am expecting that the ACCJ could be the hub of PPP.”

Sasahara mentioned three more trends to keep an eye on as paradigms change in the healthcare industry:

• Citizen engagement
• A shift from reactive treatment to data-driven prevention
• Utilization of gamification tech for patient care

The ACCJ Healthcare x Digital program focused on empowering elderly patients through digital health in 2022.

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Advocating for Change

To keep abreast of fast-changing developments in the industry, the ACCJ Healthcare Committee was invited in March to an event hosted by the American Medical Devices and Diagnostics Manufacturers’ Association (AMDD).

Led by Ikeda, who is chair of the AMDD’s Digital Health Committee, the event featured Dr. Kengo Miyo of the National Center for Global Health and Medicine, a hospital and international medical research and healthcare training facility located across Tokyo. Miyo is the director of the institute’s Department of Planning Information and Management.

Ikeda explained that the event was organized to realize medical DX in a situation where the environment is changing, and technology is progressing rapidly. “Cooperation among stakeholders toward a shared goal, and understanding of medical DX as a whole, are indispensable,” he stated.

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Future Ready

What must Japan do to ensure that its workforce can compete in a digital world?

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We’ve been living in a digital world for quite some time. More than three decades have passed since the World Wide Web began connecting us through zeros and ones. For most of that time, it’s been possible to straddle the line between digital and analog. But if the first quarter of 2023 has made anything clear, it’s that we’re at an inflection point when it comes to technology.

If Japan is to remain globally competitive and secure its future economy, it must embrace digital transformation (DX).

Despite increased efforts to push DX, Japan dropped to 29th place in the 2022 IMD World Digital Competitiveness Ranking, an annual report published by the Switzerland-based International Institute for Management Development that assesses and compares the digital competitiveness of countries based on their ability to adopt and explore digital technologies.

More concerning is that Japan ranked 41st in the talent subcategory and 54th in future readiness.

Overcoming this digital talent gap is a must. For companies, the required skill sets are shifting, impacting not only talent acquisition and retention, but also the country’s education system and overall workplace culture.

To find out where Japan is on the road to readiness, The ACCJ Journal spoke with corporate leaders making DX possible, as well as those helping companies and talent come together for success in today’s digital-driven world.

Widening Gap

Talent acquisition has become a pressing issue for companies across Japan. In a 2022 survey conducted by the Ministry of Internal Affairs and Communications (MIC), 67 percent of Japanese respondents cited a shortage of information and communications technology (ICT) personnel as a roadblock to their DX efforts.

Surveys conducted by recruitment site Doda show a sharp rise in the monthly number of job openings per candidate for engineers and other tech professionals—from 3.44 in March 2019 to 9.54 in March 2022. The Ministry of Economy, Trade and Industry (METI) projects a shortage of 450,000 ICT workers by 2030.

“We have a big problem. It’s a serious talent crisis that is going to get much worse,” said Daniel Bamford, associate director of technology for Asia–Pacific at specialized recruitment agency Robert Half Japan.

Changing Workplace

Faced with a dwindling talent pool and fierce competition, the Japanese labor system must change within a few years if Japanese companies are to acquire good talent, Megumi Tsukamoto, senior adviser at global consultancy J.S. Held Japan LLC, told The ACCJ Journal. The country’s traditional human resources model, according to which compensation is based on age and seniority, has exacerbated the digital talent shortage.

A 2016 comparative survey by METI found that the average annual salary of ICT personnel in Japan was roughly half that of their US counterparts. Workers in their twenties in the United States earned an average of $77,990 per year, while their Japanese counterparts took home just $31,300.

“Workers in their twenties in the United States earned an average of $77,990 per year, while their Japanese counterparts took home just $31,300.”

Tsukamoto noted that, in a bid to obtain and retain talent, some Japanese companies are beginning to offer salaries two to three times higher than previous packages. Some are offering much more than that. This is the result of ICT professionals either moving abroad, or choosing to work for such foreign companies in Japan as Google.

However, higher salaries are just one piece of the puzzle, said Victoria Ryo, associate director at Robert Half. In-demand ICT tech workers expect more.

“A company that provides workplace flexibility, along with benefits, interesting projects, and an international environment, is going to be more attractive,” she explained.

Ryo pointed to innovative initiatives that catch the attention of potential ICT workers. As an example, she mentioned the financial services organization Money Forward’s Culture Hero campaign, which awards employees who epitomize the company’s inclusive culture. But Bamford warns that a good diversity, equity, and inclusion (DEI) policy is not enough to attract these in-demand talents.

“For them, it’s a base expectation, not something that will win them over,” he said. “But if you’re not providing a diverse and inclusive environment, you will lose people.”

Looking Abroad

To address the domestic talent shortage, companies such as Fujitsu Japan Limited have accelerated plans to hire non-Japanese engineering researchers in the wake of recent mass layoffs in the US tech sector.

While skepticism remains that ICT workers from abroad can thrive in Japanese workplaces, where language—and sometimes insufficient DEI culture—remains a barrier, Tsukamoto cites Mercari, Inc. as a domestic player that has found success hiring international talent.

The thriving e-commerce company began its full-scale efforts to recruit overseas talent in 2018. Today, more than 50 foreign nationals are working at Mercari’s Tokyo office, according to their FY2022 sustainability report.

Last year, the company opened a subsidiary in Bengaluru, a hub for IT companies in southern India, with the goal of recruiting IT workers. As of last July, it had attracted 45 new graduates from the Indian Institute of Technology.

The school has been a popular source of tech talent for Japanese companies such as Rakuten Group, Inc., whose Bengaluru base grew from six engineers in 2014 to more than 1,000 in 2020.

The Japanese government has responded to this trend by launching two new visa schemes in April that target highly skilled foreign workers, such as researchers and engineers, as well as graduates of highly ranked universities.

The Japan System for Special Highly Skilled Professionals, or J-Skip, visa allows researchers, engineers, and business managers to bypass the points-based system used to award visas to skilled professionals.

Meanwhile, the Japan System for Future Creation Individual, or J-Find, visa allows graduates from highly ranked universities to live in the country for up to two years while they find employment.

Evolving Workforce

The Japanese government also pledged last October to spend ¥1 trillion over the next five years on reskilling workers to address the shrinking pool of tech talent.

In January, Japanese Prime Minister Fumio Kishida said that guidelines will be drawn up in June to increase labor market flexibility to encourage workers to move to high-growth sectors.

Major companies are also contributing. Amazon Web Services Japan G.K. (AWS) has invested more than ¥1.3 trillion to help its Japanese customers modernize their IT systems and to overcome their digital skills gap through education programs, training, and certification.

“Cloud and cybersecurity skills will be the two most sought-after digital skills by Japanese employers by 2025,” said James Miller, the company’s head of public policy. “AWS has trained over 400,000 individuals in Japan with cloud skills since 2017, providing them with in-demand skills and best practices to help learners and organizations innovate in the cloud.”

Miller—an American Chamber of Commerce in Japan (ACCJ) governor who also serves as co-chair of the chamber’s Digital Transformation Committee and vice-chair of the Secure Digital Infrastructure Committee—shared an example of how AWS extended a 21st-century hand to a 19th-century company.

In 2021, the company helped Toppan Printing Co., Ltd., the 122-year-old Japanese global juggernaut, embark on a full-scale digital transformation. More than 1,600 of its employees received AWS training over three months and 1,050 pursued AWS certifications in a single year.

Room for Movement

As businesses make DX a point of emphasis, having a range of skill sets has become more important. In terms of hard skills, such as cloud and DevOps, Bamford noted that recruitment has gone from a T-shaped model, where someone has broad awareness and one deep specialization, to a V-shaped one, where the candidate’s deep specialization is complemented by medium-depth knowledge in other areas.

“The other side is that the soft skills aspect is really focused on being able to bridge global and local, while also bringing technical and people skills,” he added.

While senior managers who can lead a company’s DX efforts are in demand, companies should look inward for potential employees who they can elevate, according to Bamford. He pointed to a client that was looking for a certified ScrumMaster and, rather than hiring someone already at that level, found success in ambitious young candidates who the company could train to be certified.

“Since there will be that much more demand, and that much more shortage, the secret is to unlock the skill sets of the people you currently have. Experience is nice, but learning mindsets are even better.”

“Since there will be that much more demand, and that much more shortage, the secret is to unlock the skill sets of the people you currently have. Experience is nice, but learning mindsets are even better,” he added.

Ryo noted that this can help companies retain their technical talent. “I think the number one reason people leave an organization is because they don’t feel they have the opportunity to grow.”

Preparing Future Generations

While reskilling offers companies a path to overcoming current DX issues, Japan’s new ¥10 trillion national endowment fund to boost research at universities in strategic priorities such as artificial intelligence (AI), biotech, and quantum technology is expected to help train the next generation.

However, Matthew Wilson, dean and president of Temple University, Japan Campus, believes that changing student mindsets is arguably more important to reversing the tech talent drain.

He contrasted students in the United States, who define their future goals by jobs they want to pursue, with Japanese students, who aspire to work for specific companies.

“If your goal is to work at a company, your pathway is going to be a lot different,” he said, noting that the practice of job rotations at Japanese companies, in which employees are transferred from department to department every few years, provides fewer incentives to focus on specific fields.

Wilson also noted that Japan’s public education system is “very conservative, which is difficult to change,” but is optimistic that the government’s push for DX and the advent of new AI technologies, such as ChatGPT, the conversational large language model developed by OpenAI, will accelerate change.

“It’s going to force people to educate differently and to assess differently,” Wilson said. “The point isn’t catching somebody who just did their essay with ChatGPT. Rather, it’s how to educate somebody so they have the skills and the knowledge they’re going to need for a job five years down the road.”

Unified Response

Steps have been taken to reshape the country’s education system with last year’s release of the Roadmap on the Utilization of Data in Education. A joint statement issued by the Digital Agency, MIC, METI, and the Ministry of Education, Culture, Sports, Science and Technology states that, by 2030, the government aims to create “a society where anyone can learn in their own way, anytime, anywhere, with anyone.”

While Wilson recalls similar government ambitions, such as former Japanese Prime Minister Yoshiro Mori’s “one student, one computer” initiative more than two decades ago, which had little success, he is optimistic about the Digital Agency and Minister Taro Kono, whom he praises for being “energetic and constantly finding ways to challenge processes and procedures.”

But he also noted that, while things are starting to move, “it’s going to take a while to get Japan to the digital utopia that they’ve been talking about for 25 years.”

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Surf the DX Wave

Five big lessons for Japan from Hawaii

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As Japan’s fledgling Digital Agency finds its way through its second year of existence, and the Tokyo Metropolitan Government’s new start-up strategy takes hold, a digital transformation (DX) wave is sweeping across the country. Learning to surf that wave takes experience, however, and another group of islands that know a bit about surfing, and have ridden DX to their advantage, could be a guide for Japan.

How the Hawaiian tourism industry found renewed life through digital transformation was the subject of a February 28 event held at Tokyo American Club and online, and entitled How to Surf the DX Wave: Five Big Lessons for Japan from Hawaii. The American Chamber of Commerce in Japan Tourism and Hospitality Committee luncheon—co-hosted by the Digital Transformation and the Information, Communications, and Technology Committees—welcomed Mayumi Nakamura and Mike Birt of Ascent Partners, LLC to discuss the restructuring of Hawaii’s tourism management system.

When the Covid-19 pandemic forced a total shutdown of travel, tourism hot spots such as Honolulu, which had welcomed a record 10.4 million visitors in 2019, went from overtourism to dead empty in just a few days. The islands fell quiet. And when tourism returned in 2021, it was not the same.

Recovering from Wipeout

“As people started coming back, the domestic travel industry was just a madhouse,” Birt explained. It was clear that the pandemic had left Hawaii’s tourism industry scarred and unprepared for the influx. Change was needed.

The seeds for change were planted even earlier. When heavy storms hit Haena State Park, on the island of Kauai, in April 2018, major access roads were shut down and neither tourists nor locals could enter.

It was a needed pause, however. Before the disaster, some 3,000 tourists had visited daily, leaving little room for Hawaiians. “There was some conflict there, and many people couldn’t enjoy their own homeland,” Nakamura explained.

While the storm was a multi-million-dollar disaster for many, others saw it as divine intervention, an opportunity to reappraise the management of state parks and give greater consideration to the balance of tourists and locals.

When the decision was made to transform the system, the Hawaiian government approached Ascent Partners for help. Nakamura led a team that designed a timed-entry reservation system. Entry was restricted to those with reservations, and daily tourist admission was capped. This allowed locals more opportunities to enjoy their own land. Greater emphasis was also placed on hiking the trails and evoking the experience of the natural land as the Native Hawaiians saw it.

Due to the pandemic, all the work had to be done remotely. The Hawaii project was run from Seattle, while the software development team was in India and various support staff were scattered across the US mainland.

The project was a great success. Not only were there societal benefits, but economic ones as well. The state brought in 250 percent of its projected tourism revenue in the first year.

The island of Kauai, home to Haena State Park

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Model for DX

Birt believes the fact that this project could be carried out remotely with such great success shows the potential for adapting the approach to other countries, with each following their own philosophy of reimagining post-pandemic tourism.

“It became a model for how to scale and develop very effective software digital transformation projects that can literally span the world,” he explained. “Destination management is a key element—and this isn’t just Hawaii. Venice, Iceland, Amsterdam … there are a number of [places] that have really had to work on how to manage their destination so that it doesn’t become overrun, and the community can still enjoy where they live.”

“It became a model for how to scale and develop very effective software digital transformation projects that can literally span the world.”

Birt and Nakamura said they learned a lot during their three years working with the Hawaiian state government. They shared five lessons which they believe Japan could put into action to transform its own post-pandemic tourism.

Lesson 1: DX requires leadership and vision
“Without a vision, none of the people around [you] can support the project. In the case of Hawaii, it was a return of aloha spirit,” Nakamura said. What made the project possible, she added, was that both the state government and private individuals were on board and committed to using the pandemic to take a bold step.

Lesson 2: DX has customers—and adversaries
“The state parks are literally part of [Hawaii’s] soul; Hawaiians think of their parks as almost a living thing,” Birt explained. Undertaking such a large-scale project, therefore, brought together many parties with a vested interest, whether emotional or financial.

Naturally, with this came those who strongly opposed the transformation. But nobody, Birt and Nakamura acknowledged, knowingly played the role of adversary; they resisted change simply for self-preservation. What saved the project from failure was that powerful friends in the Hawaiian state government shared the vision and supported it from the start.

Lesson 3: Technology is powerful
DX is not a simple one-and-done operation. It is an everyday effort that must be constantly analyzed and adjusted to fit the needs of the project. The DX wave does not stop or slow down. Everyone must be skilled and educated to properly participate in the journey. Questions must be constantly asked. In the case of the Hawaii project: Where are the tourists going? How are they going? How could communication be improved? What could smooth entrance into the parks?

Lesson 4: Expectations change
While the aloha spirit is the genuine treasure of Hawaii, it must always be met in balance with malama, the respect for the state and environment, as well as the customs and culture that come with it. You receive the generosity of Hawaii, but you are obliged to pay it back in appreciation. The same balance is sought in DX, where it has the potential to bring revenue and benefits, but we must be careful to not kill the goose that lays the golden eggs.

Lesson 5: DX waves won’t stop, learn to surf them
Lastly, there must be an emphasis on change, and an understanding that there is no final resting point in DX. Nakamura referred to the decline of Facebook and the rise of the artificial intelligence tool ChatGPT as examples of the unpredictable nature of technology. “You have to be ready to ride the waves as they comes,” she said. “Be adaptable, be adjustable. Don’t think of it as a destination, but as a journey.”

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Big Moves Moving

Two years into the JDA 2030, ACCJ leaders take stock of progress.

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Transformations take time. Reaping rewards can take longer. For Japan, shedding analog processes is critical for future prosperity, and the American Chamber of Commerce in Japan (ACCJ) is bringing together the broad expertise and experience of its membership to assist with the push for digital transformation (DX).

In early 2021, the ACCJ unveiled a comprehensive white paper entitled Japan Digital Agenda 2030 (JDA 2030) that outlined 11 big moves which could position the country as a global leader as we dive deeper into the 21st century. Produced together with McKinsey & Company, the JDA 2030 presents technology use cases and describes how Japan could realize a transformation that would put the world’s third-largest economy on equal footing with leading digital nations.

These measures to bolster DX in Japan call for concerted steps by major industries and stakeholders in areas such as digital talent, industry transformation, digital government, and economic renewal. And in the two years since the paper was published, the need for cross-industry collaboration to make many of the JDA 2030’s big moves a reality has become increasingly clear.

An Evolving Proposition

What has also become clear is that the pace at which digital everything is infiltrating all aspects of business and society calls for a reassessment of the JDA 2030. The ACCJ’s new Digital Forum, confirmed by the Board of Governors in April and led by Chair Mitsuhiko Ida, along with Vice-Chairs Kristopher Tate and Scott Warren, will be leading this task, working with the various digital-related committees to coordinate the chamber’s voice and position on DX.

And with DX impacting all organizations, not just those in technology fields, everyone has a role to play.

“The question is swiftly becoming, Is there such a thing as a non-tech field?” Warren told The ACCJ Journal. “We are seeing technology being applied in almost every business. I think the application of technology is almost too alluring—and necessary to keeping a competitive edge—to be ignored.”

ACCJ Digital Transformation Committee Co-Chair Jim Weisser agrees. “All businesses are digital or have a DX component. Trying to figure out which piece to transform—and how to do it—is a problem for all companies.”

“All businesses are digital or have a DX component. Trying to figure out which piece to transform—and how to do it—is a problem for all companies.”

Fellow co-chair and ACCJ Governor James Miller added: “The most important thing for members to keep in mind is the cross-sectional view versus the deep dives. There are sets of concerns that are technology specific, but we are continuing to focus on sharing what sets of issues business leaders should prioritize that are cross-sectional.”

Already, the chamber is looking at a variety of mechanisms to bring together the insights from the JDA 2030—and those continually being developed by the ACCJ’s committees—to refine its position and recommendations to provide the best guidance in a rapidly changing environment. This effort, supported by the work of the digital committees on technology-specific issues, is focused on teasing out the common positions across the broad range of committees to bring the whole chamber to bear on DX.

A question about the big moves outlined in the JDA 2030 is whether they might require a longer timeline to be realized than the seven years that remain until the original target date. This has spurred an effort to learn from the chamber’s landmark 2009 white paper Achieving the Full Potential of the Internet Economy in Japan, how progress was achieved, or efforts stalled, and how the digital agenda itself can evolve.

While a lack of dialogue or substantive business input may have slowed progress, the Great East Japan Earthquake and Tsunami of March 11, 2011, reignited interest in resilience. Similarly, former Japanese Prime Minister Shinzo Abe’s focus on the role of data at the 2019 World Economic Forum Annual Meeting in Davos has since proved to be a major lift for the JDA 2030.

Data, Trust, and Talent

At the center of Abe’s Davos proposal was Data-Free Flow with Trust (DFFT), something which Japan and its allies have struggled to define in the years since, said Warren, who is also co-chair of the ACCJ Legal Services and IP Committee as well as vice-chair of the Information, Communications, and Technology Committee.

“How we achieve [DFFT] will be one of the main topics discussed during the G7 conference. The real challenge, I think, is that the definition cannot be static, as it is very dependent on the type of data—critical infrastructure data versus other data—and the question of how much you trust the receiving entity and country. I think the true answer has to take those factors into account.”

Ida, an ACCJ governor, noted that the establishment of a new organization to promote DFFT was agreed at the G7 Digital Ministerial Meeting held in Gunma Prefecture in April. “For this, governments want private sectors to share our experiences, needs, and suggestions for policymaking. This is just one case in which the ACCJ can contribute,” he said.

Another area of great importance to successful DX is the acquisition and training of digital talent. But for a company to build a deep bench of world-class talent, with the digital know-how that is increasingly critical to success, takes time, Weisser said.

Megumi Tsukamoto, a vice-chair of the ACCJ Task Force on Economic Security, said that it is likely to take five years or so for Japanese companies to establish their digital bench once they recognize the need and begin fostering this talent. First, they must overcome major challenges in their operating cultures to provide levels of compensation expected by these professionals.

She also notes that opportunities are emerging that might enable Japanese companies and IT vendors to build their digital talent sooner. One is the sudden availability of personnel following the recent restructuring in the IT sector, both in Japan and in key markets overseas. “They’ll do it because, without IT talent, it is very difficult to compete with other global companies. It is an urgent issue,” Tsukamoto emphasized.

Companies are also increasingly aware of the business opportunities digital can drive, and are developing their people to realize them. Tsukamoto points to one Japanese service provider that is working to create tools, some powered by artificial intelligence, to help staff who lack digital skills. By pooling specialists in planning, user interface design, and the core product—and combining these with dedicated IT support—they are able to develop in-house software that can enable service staff to focus on the highest value tasks while leaving the software to automate others. She also mentioned a Japanese manufacturer that is already pairing robots with its production line workers to realize mutual benefits.

Now Is the Time

New tools such as these show that technology concerns are not the biggest obstacle. “Oftentimes, it is the business thinking that we should be focused on,” said Miller. “A lot of tools can be used to reduce risk and mitigate concerns in a way that was not conceivable a decade ago.”

Japan also brings to the table a high level of competency in science, technology, engineering, and mathematics, or STEM disciplines, that enables it to leverage a strong legacy of engineering capabilities. “Combined with being the world’s third-largest economy, the level of scale and scope of opportunities seen in Japan are really unrivaled,” added Miller.

“Combined with being the world’s third-largest economy, the level of scale and scope of opportunities seen in Japan are really unrivaled.”

These insights are the basis for plans to coordinate DX leaders across the ACCJ’s various digital committees. The goal is to
understand the high-level points and the depth of topics, ranging from talent acquisition to cybersecurity.

“Now is the time to work together,” Miller concluded. “We’re seeing dramatic changes in Japanese policy and company environment that we haven’t seen for 30 years. We are seeing a lot more combined interest in [the US–Japan] partnership.”

The ACCJ, with its diverse and multinational membership, is one of the few organizations that can pull such voices together and bring industry views to both the US and Japanese governments, noted Ida. “We can partner with both governments to support their policymaking by providing our experiences, needs, and technical assistance.”

Warren invites all ACCJ members to get involved in shaping the chamber’s digital advocacy.

“The ACCJ has consistently espoused, for years, that whatever new policies are created in Japan must be fairly implemented across both domestic and international companies,” he said. “As for specific policies to implement related to digital transformation, the ACCJ is in the process of gathering those. If you have ones you think important, please submit them to one of the many digital policy committees or to your committee leadership.”

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Have an idea? Get involved!

The ACCJ has a range of committees working on leadership and advocacy for Japan’s DX journey:

Digital Transformation • Digital Economy Task Force on Economic Security • Secure Digital Infrastructure • Information, Communications, and Technology • Healthcare • and many more

Visit accj.or.jp/committees to learn more.

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(Re)Open for Business

Japan’s long journey to open borders and what lies ahead for business and education

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It isn’t easy to do business when you’re standing outside staring through the window. But that’s the situation so many found themselves in during much of the pandemic, thanks to some of the world’s most stringent border restrictions. Japan’s reluctance to allow non-citizens to enter the country, slowness in loosening the reins, and insistence on complicated and costly requirements once the trickle was allowed to start put both domestic and non-Japanese companies in a tough spot.

Getting these policies eased became a centerpiece of advocacy for the American Chamber of Commerce in Japan (ACCJ) and other foreign chambers in 2021, and the efforts continued in 2022. It took most of the year to get the desired results, but Japan finally reopened its borders to mostly normal travel, including visa-free entry, just months ago, on October 11. And now we look ahead to 2023.

Long Road

When Japan placed visa restrictions on travelers from 38 countries at midnight on March 21, 2020, no one imagined the journey back to normality would take so long. There was still the feeling that this would be a short-term measure to minimize the duration of the pandemic, which itself was expected to pass within months if strict steps were taken. But by May 27, the list had grown to 111 countries, including the United States, and it had become clear that Covid-19 wasn’t going away anytime soon.

The ACCJ, other foreign chambers, and the European Business Council in Japan set out on a long advocacy journey calling for fair and equal treatment of foreign residents. Eventually, two of the most influential domestic lobbies—the Japan Business Federation (Keidanren) and the Japan Association of Corporate Executives (Keizai Doyukai)—added their voices, and on November 8, 2021, the Japanese government temporarily loosened restrictions on business travelers and students.

The move was welcome, but many agreed more was needed. The ACCJ continued to push for change in 2022, and the chamber’s advocacy received broad exposure in media, with coverage by Bloomberg, Kyodo News, and Nikkei Asia, and in Japanese through the Mainichi Shimbun and NHK.

On March 3, Japanese Prime Minister Fumio Kishida announced that the daily cap on entrants would be raised from 5,000 to 7,000 on March 14. More phases played out as small-scale tours were allowed and the daily arrival cap raised to 20,000 in June. Another rise to 50,000 came in September, and the country fully reopened in October.

“Our experience during the pandemic demonstrated that the ACCJ remains the single most important vehicle in Japan for its members to address shared concerns with Japanese and US leaders and with the media,” Christopher J. LaFleur told The ACCJ Journal. LaFleur, who was ACCJ chair when the pandemic began and later served as a special advisor, often spoke to media on behalf of the chamber about the border issue and advocacy positions.

“We also demonstrated our unique capacity to bring together like-minded organizations to amplify our impact. Moving forward, the chamber should continue to monitor travel policies as it focuses on other high priority issues, such as economic security and digital transformation.”

Then and Now

Just before the November 2021 announcement, ACCJ members shared with The ACCJ Journal how the strung-out restrictions had impacted their businesses.

Kenneth Lebrun, a partner with the law firm Davis Polk & Wardwell LLP in Tokyo and co-chair of the ACCJ FDI and Global Economic Cooperation Committee, said his business had been impacted in two ways. “First, we have been unable to bring new employees to Japan, whether internal rotations from our US offices or external hires, because the government is not issuing new long-term work visas. This has impacted the ability of professional service firms to provide services to Japanese clients concerning their overseas operations,” he explained.

“In addition, the blanket ban on foreign business travelers coming to Japan—and the quarantine requirements for Japanese residents traveling abroad, and then returning to Japan—has negatively affected the level of cross-border investment and M&A activity, which is a significant portion of our business.”

Revisiting these issues now, Lebrun said that the Japanese government’s resumption of issuing business visas in 2022 allowed the firm to bring new hires and rotations from its US offices to work in Tokyo and thus return normality to its services.

He also feels optimistic about M&A recovery. “As Japanese companies typically desire to conduct site visits and meet face-to-face with the management of potential acquisition targets, the easing of border restrictions has encouraged many Japanese companies to resume their overseas acquisition activities,” he said while noting a caveat.

“The rebound of outbound M&A has been tempered by the strong yen, which makes foreign assets more expensive, but I am optimistic that cross-border M&A will return to pre-Covid levels during 2023 as the macroeconomic and demographic trends underpinning Japanese companies’ desire for overseas growth remain unchanged.”

Catherine O’Connell expects that increased business activities involving non-Japanese companies and entrepreneurs will boost her own law practice, Catherine O’Connell Law. Co-chair of the ACCJ Legal Services and IP Committee, O’Connell believes that demand for fractional general counsel support for businesses will expand.

“As borders open, people need experienced, bilingual lawyers to ensure full compliance across all their business activities,” she said.

“Long before the pandemic, I was well placed to service corporate clients who need efficient, competent, and practical legal advice, tapping into a network of specialist Japanese lawyers to cover all aspects of the law. This has only gotten better during the pandemic for me, so I have full confidence the work will be consistent and rewarding.”

O’Connell, who serves as independent audit and supervisory board member for Fujitsu Limited—the first foreign woman to hold the position—also sees benefits in other areas as a result of the pandemic.

“Performing my outside board roles has also become far easier and acceptable to do remotely outside Japan when necessary—yet another pandemic silver lining,” she explained. “In my view, the border closure has not impeded the advancement in board governance as companies continue to hire directors and statutory auditors who are based overseas for part of the year.”

Learning Again

Another sector significantly affected was education. Matt Wilson, president and dean of Temple University, Japan Campus (TUJ), expressed concerns to The ACCJ Journal in November 2021 over the impact on TUJ’s students and Japan’s reputation.

“Because of the borders being closed, we have had some long-term, degree-seeking students who decided they were going to attend other institutions, take an indefinite leave of absence, or simply abandon their plans to study here in Japan,” he said. “Our concern is that the patience of our current students who are unable to enter Japan will run thin, and they will burn out on online education at strange hours in their home countries. They could decide to take a leave of absence or pursue other opportunities.”

Fortunately, the situation has improved greatly, he said when asked how things have progressed. “The reopening of the country to educators and students in March 2022 has turned the tide, and students seeking an international experience in Japan have flocked to our campus since the reopening while expert faculty from our main campus in Philadelphia have started asking about short-term teaching opportunities on our campus,” he explained.

“And due to a major influx of overseas students and increased interest among domestically based students, TUJ’s undergraduate program has soared to new heights, reaching a record 1,841 students. In 2020, TUJ’s undergraduate enrollment was about 1,250.”

Mark Davidson, a board member of TUJ as well as the U.S.-Japan Bridging Foundation, which awards scholarships to US undergraduate students to study in Japan for one semester or an academic year, said, “I’m delighted to say that inbound student mobility is back to pre-pandemic levels.”

Davidson, who also serves as vice-chair of the ACCJ Education Committee, is a strong advocate of internships and helped the ACCJ—together with the Embassy of the United States, Tokyo, and the US–Japan Conference on Cultural and Educational Interchange (CULCON)—to launch an online portal in 2019 where ACCJ member companies can post internship openings. He hopes the progress made on reopening entry into the country for students will spur development of more internship opportunities.

“In the post-pandemic world, I hope that both foreign-based and Japanese companies will redouble efforts to offer substantive, US-style internship programs to Japanese and foreign students alike,” he said. We need to get beyond the one-size-fits-all, lockstep shukatsu system and promote more flexible, practical, and innovative approaches to hiring. A serious internship program will help companies to win the war for talent and also contribute to cultivating the kind of globally talented young people that every company—and Japan as a whole—needs to succeed and prosper in the 21st century.”

TUJ’s remarkable recovery certainly points in a positive direction for young talent in Japan’s future. “With the borders open, TUJ is seeing strong demand for 10 undergraduate degrees and short-term study abroad programs from the United States and around the world,” Wilson explained. “In 2023, we anticipate that this will continue so long as Japan continues to prioritize entry for students and educators. Based on a weaker yen and issues with China’s approach to the pandemic, now is a prime time for Japan to attract students seeking higher education.”

MGM Resorts’ Osaka integrated resort concept. Image: MGM Resorts International

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Have Ticket, Will Travel

Perhaps the most noticeable impact of the border closures was the end of tourism. Some 32.5 million tourists visited Japan in 2019, and the government had set a target of 40 million for 2020. But just 2,900 foreign nationals arrived in April 2020, down 99.9 percent from the same month a year before. It was the first time since 1964 that the monthly arrivals figure had slumped below 10,000. And it’s been a slow climb out of that hole.

Now that tourists can once again enter the country, ACCJ Vice President-Kansai Jiro Kawakami, who is vice president and chief of staff at MGM Resorts LLC, is positive about Japan’s prospects for a robust tourism recovery.

“The signs are starting to emerge in the form of high occupancy and rates at hotels, large crowds at tourist sites in Tokyo and Kyoto, as well as popular attractions such as Tokyo Disneyland and Universal Studios Japan,” he said. “China was the largest source of inbound tourism before the pandemic, and we should see some of that segment return as their government eases outbound travel restrictions.”

Prior to the pandemic, there was much talk of building Japan’s first integrated resort (IR), and a number of companies were competing for the license to do so. While tourism came to a stop due to Covid-19, the IR process did not. MGM Resorts and Orix Corporation were awarded rights in September 2021 and Kawakami said they are now in the process of applying for a license to develop Japan’s first IR in Yumeshima, Osaka.

“Osaka’s IR candidate site is the same location as the 2025 Osaka Kansai Expo,” he explained. “We look forward to hearing back from the Government of Japan in the near future. In the meantime, we continue to work closely with tourism and hospitality stakeholders in Kansai to develop Osaka into a global tourism hub leading up to the 2025 Expo and projected 2029 opening of the IR in Osaka.”

O’Connell is also confident tourism will rebound, and events such as the 2025 Expo may be well timed for what she expects to be a gradual recovery.

“Any tourist who traveled here for the Rugby World Cup in 2019 has Japan as their last fantastic, vivid travel memory,” she said. “So I believe Japan is a very hot travel destination and people will be desperate to return. That said, I’m happy if tourism is slower and more controlled than before to prevent overtourism of Japan’s scenic spots.”

Resolution

LaFleur said that, through its advocacy on travel restrictions over the past three years, the ACCJ helped its members and the broader foreign community in Japan secure fair treatment and a reopening of borders that sustains both public health and the economy.

“Covid and its aftereffects remain global challenges,” he added. “However, the ACCJ can and should continue urging Japan and its global partners to ensure their heath policies enable the fullest possible economic recovery, not least because stronger economies are crucial to ensuring our countries have the resources to maintain global peace and security.”

Healthy Ideas

Innovators empower elderly patients at ACCJ Healthcare x Digital Ideathon

Started in 2020, the Healthcare x Digital (HxD) initiative of the American Chamber of Commerce in Japan (ACCJ) has grown to become a key platform for collaboration among innovators, startups, entrepreneurs, and top pharma executives.

After hosting pitch events for the first two years, the first ever HxD Ideathon took place late last fall with a hybrid in-person and online kickoff at the Hilton Osaka on October 29. This was followed by two virtual sessions on November 5 and 12, then finalized by the hybrid pitch event on November 19 at the Hilton Osaka. The four-day event was inspired by the tagline “empowering elderly patients through digital health.”

Participants included university students from the United States and Japan as well as healthcare professionals and a panel of judges from healthcare fields. Their aim? To forge new partnerships and create solutions for some of Japan’s most critical challenges in community healthcare and individual patient care.

Ideathon

The 2022 HxD event was modeled on the concept of ideathons, or workshop-like gatherings of groups tasked with challenges for which they are to propose solutions. Through this model, a total of 86 ideators, facilitators, and mentors worked together through a cyclic ideation process to identify root causes and develop the next big project in healthcare.

Day one began with opening remarks by Simone Thomsen, president and representative director of Eli Lilly Japan K.K. as well as ACCJ governor-Kansai, and continued with a panel discussion and ideation in groups to define problem statements and the healthcare challenges to be tackled. Ideation continued on days two and three, when teams focused on initial designs and worked to find agreement on a solution—one per group—that was to be presented on pitch day.

The event culminated on November 19 with a pitch contest in which nine teams presented their concepts, and engaged in question and answers sessions with judges, who then selected the best ideas. The winning teams will move forward to the next phase of the competition—a hackathon—to be held in 2023.

Pitch Day

The final day was divided into two rounds during which each group had five minutes to pitch their solution to a panel of judges.

Perhaps the biggest draw of HxD is the opportunity to present ideas directly to—and receive invaluable feedback from—industry leaders. There’s also the possibility of entering into a joint venture with, or receiving investment from, an industry player.

Winners also receive cash prizes and, this time, will have the chance to present their ideas at the 2025 Osaka Kansai Expo and as part of the Japanese government’s Super City Initiative.

Let’s take a look at this year’s pitches.

Kyocare

Presented by Hiba Abulgasim, Kyocare is a digital customer-to-customer and business-to-business platform that provides flexible, personalized, quality care.

In the pitch, Abulgasim noted that 28.9 percent of Japan’s population is over the age of 65 —a record number that is growing. But the workforce tasked with caring for them is understaffed and overworked, and about 70 percent want to leave the profession.

This means care services are poorly coordinated. Many elderly people feel lonely and disconnected as a result, and family members tasked with their care feel stressed out.

The solution? Kyocare provides on-demand caregiving services for the elderly through an app that matches those who need long-term home care with nearby care workers.

Hi-Real System

A digital ecosystem pitched by Masato Suzuki and Sachiko Nakatsuka, Hi-Real System allows emergency-patient health records to be accessed by healthcare professionals even before emergency care is provided.

In their problem statement, Suzuki and Nakatsuka asked, “How do we support emergency triage when medical resources, such as medical staff, are limited?” Their solution involves a blockchain emergency information transmission service that instantly shares patient information to the hospital before patient arrival, which can then be used for smoother emergency treatment diagnosis.

Maya Mind

Osaka University Assistant Professor Gajanan Revankar presented Maya Mind, a web platform accessible via smartphones, tablets, or personal computers that targets patients who suffer from dementia. Revankar noted that, during early onset of dementia, diagnosis is time consuming and costly, while accuracy is low. Maya Mind seeks to tackle all these challenges.

The app uses eye tracking, speech processing, artificial intelligence (AI)-based analytics, and machine learning algorithms to create an index score for classifying different kinds of dementia, among other provisions.

AI Assistant

Ajinkya Takawale and Tomoko Mitsuoka pitched a voice-controlled AI assistant with a focus on early diagnosis of chronic kidney disease (CKD) and diabetes. The challenge before Takawale and Mitsuoko included how to leverage digital technologies to make the elderly more aware of their health risks through early diagnosis. Their voice-controlled robot uses non-invasive methods such as retinal imaging to track, record, and analyze an elderly person’s healthcare data. Using the results, they provide a diagnosis and help the person plan their lifestyle based on the insights.

Toilet Light Sensor for CKD

Chisato Banno and Reiko Tsubaki, both third-year students at Tokyo Medical and Dental University, also pitched a digital solution for patients at risk of CKD. Their solution offers a low-cost yet accurate Internet of Things device that samples, analyzes, and visualizes a person’s real-time health data, helping them to diagnose the onset of CKD early.

Their first prototype will use toilet-based light sensors that can analyze urine. The data gathered can be visualized via a smartphone app, which also can share data with a relevant healthcare provider, such as a hospital.

Helper-san

An avatar bot that identifies and neutralizes triggers that cause aggression in dementia patients, Helper-san is a digital platform that was presented by students and researchers Shobha Dasari, Allison Jia, Kanon Mori, Aarushi Patil, and Tsubasa Tanabe.

The students and researchers are part of a collaboration involving universities in Japan and the United States brought about by the Japan-American Innovators of Medicine, a four-month program in which medical innovators from both countries join to tackle a global healthcare issue related to dementia, such as aggression.

Their bot, which is embedded in a small, television-like device, can track a patient’s behavior, identify aggression triggers, and defuse them. An example would be dimming or turning off a light source that has been identified as the trigger.

Parapul

A web app presented by Kasper Watanabe, Parapul helps caregivers obtain the information they need, build relationships with like-minded people, and support their caregiving lives.

As the portion of society classified as elderly increases, Watanabe noted, the physical, mental, and financial burden on family members will grow, and yet such caregivers often lack the information necessary to provide care.

The Parapul platform is based on three pillars:

• Providing customized information, such as nursing care, educational materials, or local service listings to family members who are caregivers
• Connecting caregivers so they can share their challenges on bulletin boards, question-and-answer boards, or via direct messaging
• Offering a caregiving management system that, for instance, allows users to schedule nursing care support

Mobile Health

Pitched by Jingwen Zhang and Nondo Jacob Sikazwe, Mobile Health (mHealth) is a community platform that allows those at risk of CKD to be inspired to connect and receive information that can help them manage the condition.

During their presentation, the ideators noted that there are few digital tools on the market to help patients prevent or manage CKD. Why is this? First, individuals at risk, or who have early onset, of CKD have no or only slight symptoms that cause them inconvenience in daily life.

What’s more, those with middle-to-low incomes often struggle with daily living, which leaves little time and few resources to access primary healthcare.

Lastly, current biomarkers used to screen for CKD are affected by many factors, so there is a need for regular checkups.

Their community platform solves these challenges by incentivizing elderly people and their caregivers in three key areas:

• Motivation: where you can collaborate with the local community and receive community rewards for positive lifestyle changes
• Connection: where you can communicate directly with a healthcare provider
• Education: participate in customized, immersive games, quizzes, audio guides, and more that shed light on the issues of CKD

Coupon Kun

The final pitch, by Zechen Zeng and Keita Tsuyuguchi, addressed loneliness among elderly, which has reached epidemic levels. Zechen and Tsuyuguchi’s solution is a social network being developed in four phases. Phase one is to create a “Groupon experience,” through coupons for groups, that incentivizes elderly individuals to experience new things—such as hobbies, lessons, or traveling—with new social connections.

In phase two, the platform aims to introduce digital literacy to the elderly, including adoption of smart devices, while they undertake the group experiences.

In phase three, apps are used to monitor, collect, and share the health data of users with healthcare professionals following strict data privacy and security protocols.

And in phase four, insights gleaned from healthcare data are used to help users follow a healthy lifestyle.

Winners

With so many innovative ideas to consider, selecting the winners was not easy for the panel of industry professionals tasked with judging the 2022 HxD Ideathon.

Pitches were scored based on scientific innovation, relevance and timeliness, business feasibility, and how well they addressed the core issue.

Three ideas were selected to advance to the HxD hackathon in 2023:

• Maya Mind
• Hi-Real System
• Toilet Light Sensor for CKD

One other, Kyocare, was given special recognition and will also be part of the hackathon.

Overall, 119 ideators, facilitators, and students participated in at least one day of the ideathon, and connections were made with more than 22 universities for future events.

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Judges

Kozo Mori
Director, Medical Industry City, Medical and New Industry Division, Planning and Coordination Bureau, Kobe City Hall

Masayoshi Yamada
Deputy director, Department of Smart City Strategy, Strategy Promotion Office, Regional Strategy Promotion Division, Osaka Prefecture

Torsten Kanisch
Executive officer and vice president, commercial excellence, AstraZeneca K.K.

Christian Boettcher
Consulting partner, health sciences and wellness, EY Strategy & Consulting

Francisco Proano
Head of strategy and digital transformation, Bayer Yakuin

Yasuhiko Iida
Senior director, Consumer Experience Team and Next Generation Customer Engagement Strategy, Eli Lilly Japan

Hiroki Kayama
Strategic partnership development manager, AI for Japan, Google G.K.

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Stronger Together

The ACCJ promotes US, Japan, and regional collaboration for economic security

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The US–Japan partnership is the cornerstone of peace, security, and stability in the Indo-Pacific region, and the alliance got a boost in May when US President Joe Biden, visiting Tokyo, launched the Indo–Pacific Economic Framework for Prosperity (IPEF) with a dozen initial partners.

The launch came soon after the introduction of the Economic Security Promotion Bill in the Diet in February and was a welcome development for the American Chamber of Commerce in Japan (ACCJ), which believes that Japan’s efforts to promote economic security represent an important opportunity to further strengthen the vital bilateral partnership.

IPEF is built on four key pillars:

• Connected economy
• Resilient economy
• Clean economy
• Fair economy

The ACCJ was honored to be present at the launch, with leaders in the room with Biden, Japanese Prime Minister Fumio Kishida, and Indian Prime Minister Narendra Modi, while officials from 10 other IPEF member nations joined online.

In announcing IPEF, the White House said in a fact sheet that “the United States and our partners in the region believe that much of our success in the coming decades will depend on how well governments harness innovation—especially the transformations afoot in the clean energy, digital, and technology sectors—while fortifying our economies against a range of threats, from fragile supply chains to corruption to tax havens.”

In addition to Japan and India, those partners are Australia, Brunei, Fiji, Indonesia, Malaysia, New Zealand, the Philippines, Singapore, South Korea, Thailand, and Vietnam. There is an open invitation to other nations to join.

Task Force on Economic Security

Along with entry restrictions, digital economy, healthcare, and sustainable society, economic security was one of the ACCJ’s five key advocacy pillars in 2022.

With the Diet taking up the Economic Security Promotion Bill and IPEF approaching launch, in February the chamber formed a Task Force on Economic Security, led by Chair Arthur Mitchell and Vice-Chairs Shuichi Izumo, David Richards, Eric Sedlak, Megumi Tsukamoto, and Toshiki Yano.

On April 12, in support of the efforts by the Government of Japan (GOJ) to promote Japan–US economic security in the context of further strengthening the US–Japan partnership, the task force announced six principles to maximize the contributions of foreign companies to further enhance Japan’s attractiveness as a place for business to invest, innovate, and grow. These are:

• Maintain commitment to economic growth and free market principles.
• Work with partner countries and ensure a level playing field.
• Define critical infrastructure, equipment, and services narrowly and clearly.
• Ensure transparent and fair processes.
• Leverage global best practices.
• Reinforce US–Japan economic collaboration.

The first notes that the promotion of competitive and efficiently regulated markets, as well as open trade and investment, are essential to harnessing the dynamism of the private sector to drive economic growth, prosperity, and overall welfare in Japan. Ensuring predictability, consistency, and alignment across various regulations, while avoiding overly prescriptive, inconsistent, or duplicative measures that risk impairing market dynamism, is key.

The second points out that allowing new market entrants fair access and guaranteeing fair treatment of all market participants is critical. Any measures to introduce differential treatment on the basis of promoting economic security should be narrow, targeted, and not undermine the ability of companies from allied and like-minded countries to continue making important contributions to Japan’s economic welfare and economic security.

From left: ACCJ Economic Security Task Force Vice-Chair Shuichi Izumo, then-Economic Security Minister Takayuki Kobayashi, ACCJ President Om Prakash, task force Chair Arthur Mitchell, and Vice-Chair Megumi Tsukamoto

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The third requires that certain infrastructure, equipment, and services designated as critical be narrowly and clearly scoped, and not cover wide categories of offerings in Japan. This will help ensure that the right resources are applied to protecting the parts of the infrastructure that are most essential, and not extended to non-critical systems.

The fourth asks the GOJ to ensure ample opportunity for broad stakeholder engagement at all stages of development, implementation, and enforcement of rules related to economic security. Ensuring that procedures such as notification or reporting requirements are clear, simple, reliable, and appropriately scoped—and are informed on an ongoing basis by private sector engagement and expertise—will be critical, the task force says, to avoiding negative unintended consequences and achieving their intended goals.

The fifth notes that the adoption of global best practices will promote efficiency and sound regulation, thereby helping Japan benefit from innovation and expertise developed across the globe. By proactively engaging with like-minded countries, such as the United States, the GOJ can develop and elevate best practices as internationally recognized standards, including with regard to ensuring data free flows with trust.

The final principle calls for bilateral mechanisms for cooperation, such as the US–Japan Economic Policy Consultative Committee, established in January 2022, as well as multilateral groupings such as the G7 and IPEF, to be leveraged to share best practices and promote alignment and interoperability in each country’s respective mechanisms for promoting economic security.

Task force Chair Mitchell, Vice-Chairs Izumo and Tsukamoto, and ACCJ President Om Prakash had the honor of discussing the principles directly with then-Economic Security Minister Takayuki Kobayashi on April 21.

With the passage on May 11 of the Act for the Promotion of Ensuring National Security through Integrated Implementation of Economic Measures by the Diet, IPEF underway, and Japan set to host the G7 Summit in Hiroshima in May, economic security will continue to play a key role in ACCJ advocacy throughout 2023.

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Read the full ACCJ Principles for Promotion of Economic Security.

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CO2 Punch!

On the road and in the air, companies are charting a more sustainable future for transportation and travel

Electric propulsion enables small, zero-emissions aircraft that have the potential to bring sustainable flight closer to home.

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Those old enough to remember road trips in the days before handheld video games, televisions mounted in headrests, and smartphones will recall the myriad ways in which we entertained ourselves as the miles went by. Some games involved punching each other when a (gas-powered) Volkswagen Beetle was spotted. Others required finding out-of-state license plates. And then there were those about numbers.

Today’s numbers from the road are a bit less fun. Globally, 14 percent of greenhouse gas emissions originate from the transportation sector—and that jumps to 27 percent in the United States. Cars aren’t the only culprits. The aviation industry is also concerned about its share of carbon dioxide (CO2) going into the atmosphere. On our way to a sustainable, carbon-neutral future, bypassing such pollution is a must.

The ACCJ Journal spoke with companies in the automotive and aerospace sectors to take the pulse of transportation and find out where future journeys might take us.

Hit the Road

Everywhere you turn, there’s a car. And most are still burning gasoline. But as climate change becomes a more urgent problem, the tide is turning. The compound annual growth rate of the electric vehicle (EV) market is now at 24.8 percent, and sales are projected to reach $980 billion dollars by 2028, up from $185 billion in 2021.

The move by California to ban the sale of new gas-powered cars and light trucks by 2035 is sure to accelerate that change, at least locally.

While it might feel as if electric cars are a rather new invention, they’ve been around for a long time. The first was Scottish inventor Robert Anderson’s motorized carriage around 1832, more than 50 years before German engineer Karl Benz rolled out the first gas-powered car.

So, what’s old is new again as EVs drive their way to the head of the pack and cut greenhouse gas emissions in the process.

Tesla may be the first brand that comes to mind when asked to name an EV, but there are many options on the road today, ranging from the very affordable Nissan Leaf to GMC’s powerful-but-expensive Hummer EV pickup. Chevy has even announced an all-electric Corvette. What would Florence Jean “Flo” Castleberry have to say about that? These are all changing the way we think about automobiles.

“Similar to the way the smartphone turbocharged the use of the internet, pushed it to become fully mobile, and instigated many new services—and industries—EVs are digitally transforming the transportation industry as a conduit for new mobility technologies that go beyond simply using an electric power source,” explained Karma Automotive LLC’s Chris Sachno, who will speak about electrifying mobility at an event hosted by the American Chamber of Commerce in Japan Information, Communications, and Technology Committee on October 6.

The senior vice president for e‑mobility, cloud services, and innovation said this is summarized by the CASE model of automotive technology megatrends. An acronym for connected services, autonomous vehicles, shared mobility, and electrification technologies, CASE is providing a superior user experience with groundbreaking technologies, Sachno explained. “There are economic benefits, as well, such as lower total cost of ownership and reduced emissions, which encourage economic activity within communities,” he added.

The Karma GS-6 54 Edition

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Karma has developed a commercial solution called Powered by Karma which enables existing internal combustion engine (ICE) vehicles to be converted to electric powertrains.

“This dramatically reduces the complexity of the drivetrain by 90 percent, from more than 1,000 components to fewer than 100,” Sachno said. “Installing an electric powertrain into an existing commercial vehicle also extends the life of the vehicle’s other parts, such as the body, chassis, brakes, and interior. This reduces the emissions created during the production of a new vehicle, or from scrapping or recycling the old vehicle.”

The Powered by Karma electrification solution, which utilizes the company’s OEM experience and automotive grade technology in providing top-quality engineering, design, electrification, and contract manufacturing, delivers a total cost of ownership reduction of up to 48 percent.

“We believe this provides a unique proposition for the commercial vehicle space by offering electrification solutions for existing vehicles, rather than relying on the replacement of existing ICE vehicles. Substitution will take considerable time, especially given the long lifetime of commercial vehicles,” Sachno said.

The Irvine, California-based EV startup also designs and manufactures its own vehicles. The Revero GT is powered by dual electric motors that offer extended range and embody Karma’s goal of offering leading technology with a luxury experience. And last year, Karma introduced the 536-horsepower GS-6, which Sachno said “looks amazing, is incredibly fun to drive, and is packed full of cutting-edge technology.”

While building such vehicles, Karma is dedicated to sustainability and, in 2021, joined The Climate Pledge, which was co-founded in 2019 by Global Optimism, and ACCJ corporate sustaining member Amazon. As a signatory, Karma has committed to become net-zero by 2040.

“This commitment encompasses our production facility, supply chain partners, and product lineup, which includes vehicles powered both by hybrid and pure electric powertrains and propulsion systems,” Sachno explained. “Karma continues to align with partners that share the same philosophy on protecting the environment and investing in research and development projects that have a positive effect on the planet. We look forward to collaborating with other Climate Pledge signatories on research and development of green technologies in the automotive space to advance and attain the goal of becoming net carbon neutral.”

Take Flight

The ground can only get you so far. Air travel is essential to life in the 21st century. In our tightly knit, global community, the movement of people and goods is key to a healthy economy, quality of life, and support of those in need following disasters and during humanitarian crises.

The coronavirus pandemic may have curtailed travel, but the statistics from 2019, the last year before the appearance of Covid-19, demonstrate the importance of air travel. In that year, according to the Geneva-based Air Transport Action Group, 4.5 billion people flew, $7 trillion in goods were exchanged, and the aviation industry supported 87.7 million jobs.

The environmental impact of aerospace will again increase, what with global travel now recovering as border restrictions and testing requirements are lifted. Japan, one of the only countries still limiting the number of tourists it allows in, announced on September 23 that it will fully reopen on October 11.

In 2019, the airline industry generated 900 million tons of carbon emissions, accounting for 12 percent of transportation-related emissions and 2.6 percent of all emissions globally.

Two companies with which The ACCJ Journal spoke explained the steps they are taking to reduce their carbon footprint.

Boeing, also an ACCJ corporate sustaining member, designs and manufactures some of the most widely used passenger planes. It put additional emphasis on sustainability in 2020 by naming a chief sustainability officer, reviewing the composition of its board-level subcommittee, and explicitly incorporating sustainable aerospace into the company’s values and strategic objectives.

There are four pillars to Boeing’s sustainability activities:

• People
• Products and services
• Operations
• Communities

“Today, all our stakeholders are increasingly concerned about sustainability and, specifically, the environmental impact of aerospace,” said Will Shaffer, president of Boeing Japan and an ACCJ governor. “We recognize climate change-driven risks and the need to decarbonize aerospace for sustained long-term growth, as well as stakeholder trust and preference.”

Everything for Zero

Boeing’s vision for future flight is embodied in the company’s Everything for Zero initiative, which comprises four strategies to get to zero-climate-impact aviation:

• Fleet renewal: replacing older models with more efficient ones
• Operational efficiency: leveraging data, digital tools, and modifications to reduce emissions
• Renewable energy transition: utilizing sustainable aviation fuel (SAF), renewable electricity, and green hydrogen
• Advanced technologies: intersecting fuel sources with advanced-technology flying machines

Also, part of the initiative is verified offsets—midterm, market-based solutions for matters which cannot yet be sufficiently addressed.

“Boeing has invested more than $60 billion over the past 10 years to improve sustainable product lifecycle, including innovative technologies such as the digital thread, carbon composite materials, and advanced high-bypass-ratio engine designs,” explained Shaffer. “Other aerodynamic improvements include a natural laminar flow that reduces drag to improve environmental efficiency.”

These efforts have led to planes which provide significant efficiency gains. Each generation reduces fuel use and emissions 15–25 percent, as demonstrated by the Boeing 777-9, which has 25-percent lower CO2 emissions compared with previous planes. The 777-9 is slated to enter service in 2025.

Airlines flying Boeing planes are taking advantage of these new technologies as they move along their routes to net-zero.

“Many customers have accelerated the retirement of older airplanes during the pandemic to optimize their fleets with the latest, most-efficient models,” Shaffer said. “Our latest Commercial Market Outlook forecasts that 49 percent of the 41,170 planes needed will be fleet replacements. Boeing will continue to invest in efficiencies that reduce fuel use and carbon emissions.”

Given that those airplanes will use current propulsion technology and be flying for the next 20–30 years, SAF will play a big part in realizing the aviation industry’s ambitious goal of zero carbon by 2050. Boeing and the world’s airlines recognize the importance of increasing SAF production and promoting its use. In fact, this year Boeing procured 2 million gallons of SAF for its own operations at its factories in the United States. And in Japan, it recently joined ACT for SKY, a voluntary organization of companies from the airline, engineering, and biofuel industries, among others, that works to commercialize, promote and expand the use of Japan-produced SAF.

Sustainable Flight Challenge

Fellow ACCJ corporate sustaining member Delta Air Lines, Inc. is one Boeing customer that is assisting with the development of new technologies and solutions.

In April, Delta’s most fuel-efficient plane at the time, the Boeing 737-900ER, made a flight powered by a fuel blend that included 400 gallons of SAF. It was part of the Sustainable Flight Challenge hosted by the SkyTeam Alliance, a group of 18 airlines that operates more than 10,000 daily flights over 1,062 destinations in 170-plus countries. The flight was part of Delta’s ongoing efforts to reduce its carbon footprint—a goal to which the airline is devoting significant resources.

Delta now has even more fuel-efficient planes in its updated fleet, including the Airbus A350-900 and the A330-900 neo.

Airbus A350-900

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“In 2022 alone, we are expecting to have reduced fuel consumption by more than 10 million gallons through operations and fleet modifications, including reducing aircraft weight, modifying landing approaches, and optimizing flight speed,” according to Victor Osumi, managing director and president of the Atlanta-headquartered airline’s operations in Japan.

“We’re also funding top minds to accelerate new innovations through our pension fund’s co-investment with the TPG Rise Climate Fund.” This fund opened in early 2021 and closed its inaugural fundraising in April of this year, having brought in $7.3 billion. The primary climate investing strategy of global alternative asset manager TPG, it focuses on five climate sub-sectors:

• Clean energy
• Enabling solutions
• Decarbonized transport
• Greening industrials
• Agriculture and natural solutions

To support the exchange of knowledge and generate investment opportunities, TPG formed the Rise Climate Coalition. Some 28 companies, including Boeing, are part of the alliance, and Delta announced its involvement in March. Delta Vice President of Sustainability Amelia DeLuca said in the announcement that “investing in TPG Rise Climate is the next step … as we work to decarbonize our operations while supporting promising solutions for the future.” All these efforts are important parts of how Delta is pushing the industry forward.

“As we reshape the fundamentals of aviation, we are dedicated intently across these areas to making immediate progress and to investing wisely in disruptive solutions,” explained Osumi, who is also an ACCJ governor. “A portfolio of short-, medium-, and long-term actions across the industry are essential to achieving net-zero aviation.”

Start Me Up

Electricity could be one solution. Might it serve as a power source for aircraft, as it now widely does for cars? Osumi said that, as of now, electric-powered aircraft appear to be an option for smaller, shorter-haul flights. “But as investments and innovations continue, that could evolve,” he added. “We believe that there are many paths that could help accelerate us to a more sustainable future.

Renewable electricity is part of Boeing’s Everything for Zero initiative. The company and its joint venture partner Wisk Aero LLC announced on September 20 a roadmap for the deployment of an electric vertical take-off and landing (eVTOL) solution for urban commuters.

“Boeing and Wisk are developing a two-passenger eVTOL air taxi, which has flown more than 1,500 successful test flights since 2017,” explained Shaffer. “Wisk’s sixth-generation eVTOL aircraft will represent a first-ever candidate for the certification of autonomous, all-electric, passenger-carrying aircraft in the United States.”

And in January, GE Aviation announced the selection of Boeing to support the flight tests of its hybrid electric propulsion system—a big step forward in exploring ways to reduce carbon emissions.

Boeing has been exploring and developing concepts for advanced aircraft that can meet specific energy-efficiency, environmental, and operational goals.

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Hydrogen High

Given the success of transitioning cars to electricity, it’s no surprise that the same ideas are being applied to aircraft. But what about the universe’s most abundant chemical substance? Could hydrogen one day be used to zip air passengers around the globe?

Osumi said that hydrogen is one of the options being explored by Delta for next-generation aviation. The company has partnered with Airbus to study hydrogen-powered aircraft as well as the ecosystem required at airports and beyond as a way to reduce aviation emissions exponentially.

Boeing is also innovating with hydrogen. Shaffer noted that they’ve been developing hydrogen and fuel cell applications on board aircraft for more than 15 years, carrying out six hydrogen technology demonstrations with crewed and uncrewed aircraft using hydrogen fuel cells and hydrogen combustion engines.

“We benefit from green hydrogen for any version of the future,” he said. “Green hydrogen is used to produce SAF and it has the potential to be used in future propulsion systems, when the technology is ready.”

A new Japan Research and Technology Center, focused on sustainability, that opened in August is just one of the investments Boeing is making to find sustainable solutions in Japan. As part of this, Boeing and its Japanese partners will pursue research into zero climate impact aviation under an agreement with the Ministry of Economy, Trade and Industry. In addition, it also announced a partnership with Mitsubishi Heavy Industries in July that will involve the study of hydrogen as well as other sustainable technologies.

New Heights

Osumi said he and Delta look forward to fostering collaboration with the industry, academia, and startups to accelerate the sustainable future of flight. “We’re optimistic about early-stage companies pushing the boundaries with futurist thinking on aircraft, propulsion, and more.

“And we’ve proven that the infrastructure exists to make sustainable aviation fuel, or SAF, accessible to every major airport on the East Coast by leveraging our partnership with Colonial Pipeline.” This company operates the largest pipeline system for refined oil products in the United States.

With the evolution of next-generation technologies, he expects to see new designs for planes and a completely transformed client perception. “Even now, on Delta planes, the customer experience is beginning to look more sustainable, with refreshed onboard product offerings such as artisan-made amenity kits, recycled bedding, reusable and biodegradable service ware, and premium canned wine.” Together, these products will reduce onboard single-use plastic consumption by approximately 4.9 million pounds per year—roughly the weight of 1,500 standard-sized cars—and significantly increase Delta’s support of minority- and women-run businesses.

Boeing aims for much the same.

“Our common goal is to have zero impact on our planet while maintaining and growing the societal benefits of air transportation,” concluded Shaffer. “To ensure the benefits of aerospace remain available for generations to come, we have work to do. We’ve made great strides since the beginning of the jet age, but our greatest accomplishments are yet to come. We believe the future of flight will take ‘everything for zero.’”

Individual Matters

Companies put diversity, equity, and inclusion at the center of return-to-office policies

Offices in Japan have seen a revolution over the past two years or so, with the pandemic having ushered in the need for remote work. Despite being largely unfamiliar with the practice, companies across the country stepped up to the challenge. But, as living with Covid-19 has become standard, many businesses have back-pedaled or adapted their approach as they navigate a return to the office. Others have come to see the new normal as an opportunity to reflect on where, when, and how employees work, to foster greater productivity, and expand their diversity, equity, and inclusion (DEI) efforts.

The ACCJ Journal spoke with leading companies in various industries to explore the lessons they have learned from the pandemic vis-à-vis work and what the future might hold for employees in Japan.

Starting from Behind

When Japanese enterprises were slow to respond to the government’s request, in February 2020, to allow 70 percent of employees to telework to help contain Covid-19, they came under fire. Critics said companies’ working cultures were outdated and being held back by a focus on presenteeism and physical administration tools such as hanko (seals).

A study by Tokyo-based brand consultancy Riskybrand Inc., however, shows that Japan was simply behind the curve. Only five percent of the country’s workforce was practicing telework pre-pandemic (compared with 32 percent in the United States and 27 percent in the United Kingdom), making remote work an abrupt switch for Japanese companies.

Still, many were able to implement the recommendation quickly. According to a Riskybrand survey of some 1,700 businesspeople in Japan, in May 2020 almost 40 percent were working remotely at least three days a week, of whom 20 percent were doing so daily. The larger the company, the more extensive the implementation, with 30 percent of large organizations (those with more than 3,000 staff) offering telework compared with 14 percent of small and medium-sized enterprises (SMEs), defined here as having fewer than 50 employees.

Managed talent services provider MESHD, a brand of Tokyo-based HCCR, was among those to respond swiftly. On the declaration of Covid-19 being a pandemic, the enterprise shifted from office-based work to a compulsory work-from-home model across its Japan and India offices.

“On the whole, the company responded positively to the changes, and we saw no visible dips in performance and limited impact on team dynamics,” said Chief Executive Officer Sean Travers. “We felt the team was working as effectively remotely as they [had been] from the office.”

“Covid-19 and the workstyles adopted to mitigate it have boosted understanding of, and a desire for, greater DEI in business.”

Following the government’s first state of emergency declaration, healthcare company Novartis Pharma also introduced remote work for all staff, unless it was absolutely necessary for them to go to the office or attend critical customer visits. To support employees affected by the closure of schools and childcare centers, Novartis provided additional childcare services until the end of 2020.

Coca-Cola (Japan) Co., Ltd., meanwhile, encouraged employees to work remotely in the early days of the pandemic, before closing its office for a time in March 2020 and asking all staff to telework. On reopening, the organization capped office attendance at 25 percent to ensure employees were allowed to access the office for critical work of specific needs.

From those early days, the uptake of remote work by companies with white-collar workers has continued to rise—and increasingly so with the emergence of the highly contagious omicron variant of the coronavirus. By fall 2021, 52 percent of enterprises in Japan were offering telework, according to statistics portal Statista.

Office Allure

With Japan now well into the third year of the pandemic, many companies are returning to the former status quo.

In a survey of 6,500 companies by Tokyo Shoko Research, Ltd., 27 percent of those offering telework during the height of the pandemic had stopped doing so as of June, up from 21 percent in October 2021. Only 29 percent of those surveyed now offer the option of remote work, down from 37 percent in October 2021. Large enterprises were more flexible (57 percent offered telework) compared with 24 percent of SMEs.

And it is not only companies that are trying to go back to the former normal. About one-quarter of those offering teleworking said only 10 percent of their staff were using the option as of June 2022.

The reasons for this are unclear, especially as 80 percent of employees surveyed by Teikoku Databank Ltd. in February 2022 said they wanted to continue teleworking, citing reasons such as saving time on commuting, having freedom to care for family members, or gaining greater work–life balance.

But the past two years have shown that teleworking can pose difficulties for some groups, including those without an adequate office setup or a conducive working environment at home, which may make returning to the office appealing.

From the early days of the pandemic, EY Japan recognized that not everyone would have the ideal environment for telework and supported staff financially by purchasing display monitors, microphones, and other equipment for their use at home.

The company’s DEI leader, Megumi Umeda, said the move acknowledged the potential of remote work to “enhance the workforce by welcoming working mothers, people with disabilities, and others who have limitations on their workplace and working hours.”

Patrick Jordan, vice president of human resources for Coca-Cola Japan & Korea at The Coca-Cola Company, also found that not all staff were equipped—physically, mentally, or emotionally—to work from home, noting that the company’s implementation of telework was “a great learning experience” regarding employee needs.

“While we wanted to ensure the safety of our employees from Covid, we also recognized we have to ensure their safety in many other ways, such as mental health,” said Jordan, adding that staff with medical concerns or who were uncomfortable working at home were allowed to return to the office, while undertaking thorough infection control measures.

For MESHD’s Travers, only a few months of telework brought to light issues for new hires. “New joiners were really struggling with their onboarding,” he said, noting that he “underestimated the impact of them not being in the same room as senior members” who could guide them in phone interactions, exchanges with fellow employees, day-to-day queries, and so on.

Learning Lessons

As the advantages and disadvantages of telework have become more apparent, so too have some successful approaches to future workstyles. Many companies have been finding out more about what employees want and giving them the choice to work in ways that suit them, all the while offering a hybrid work model.

Coca-Cola removed the office’s staff capacity rate of 25 percent in June and monitored attendance to see if there were any changes. When the number of staff working in the office didn’t rise, leaders had a sense of validation, believing that staff “didn’t want to return, didn’t see value in returning, or were not sure how to return,” explained Jordan.

However, the subsequent introduction of flex guidelines, to enable teams to choose how to work virtually, has resulted in an organic increase in attendance to 30 percent capacity. This shows that “clearer instructions are needed to help people settle into a more balanced hybrid way of working,” he added.

He also pointed out that survey data is critical for gaining better understanding of the desirable elements of hybrid working, as well as people’s concerns about working at the office or at home.

Flexibility is also key at Novartis. The company offers a framework called Choice with Responsibility, which was implemented in July 2020 in the belief that the pandemic would last longer than the world anticipated.

“This evolving framework asks employees and leaders to continue redesigning the way we work and make the best choices for high-impact hybrid work—not just for the individual but also for the team,” explained Chanel Leitch, country head of people and organization for Japan at Novartis.

Novartis has a new space for individual work which can be easily converted for small group discussions or medium-sized group short meetings.

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While the company continues to restrict the number of staff working at headquarters to 50 percent of each division at any one time, other limitations, such as the number of face-to-face attendees in meetings, have been relaxed to give staff autonomy over their workstyle. As a result, “each employee is now used to making sound decisions as to how they can best produce outcomes as an individual and a team in a hybrid working environment,” said Leitch, adding that the approach is “a key driver of engagement and continued retention.”

Similarly, EY Japan’s recent people survey also shows that continuing to offer telework options has resulted in improved engagement and inclusivity.

Since introducing this workstyle in 2018, the company launched its Flex and Remote Program in 2020 as a commitment to employees. EY Japan has promised to continue offering staff flexibility regarding where and when they work, regardless of the Covid-19 situation.

“Each person’s schedule is unique, considering the needs of the individual, the project they are working on, and the needs of the client and the team,” and therefore requires flexibility, Umeda said.

A new volunteer program was implemented to provide financial support to employees who wanted to move outside central Tokyo and work remotely from the suburbs. This supports employees desire to live outside Tokyo and contributes to the larger community.

Big Picture Thinking

Looking ahead, the future of work is likely to focus on how and why people work, as much as where and when they work. For many companies, the pandemic has shone a light on what work traditionally has been and has prompted or accelerated discussion on what work could be after some out-of-the-box thinking.

“As an organization, we need to think about the reasons we want our team to spend time together in the office,” said Travers. “It needs to go beyond just working at your desk.”

Indeed, with staff now able to conduct meetings online and do “deep work” and other individual-based tasks remotely, companies are keen for office-based time to focus on interactive activities, such as mind mapping and team building.

Coca-Cola has redesigned one floor of its headquarters as the Coke Collaboration Center, an experimental initiative to encourage teamwork via hot desks, lockers, meeting spots for different groups, and phone booths for individual or remote meeting participation.

EY Japan’s Umeda agrees that the role of the office has changed, noting that it should “become a collaboration space for colleagues, clients, and business partners, not a workspace.”

And, given that online employee social events “could never really be a substitute for an in-person, on-premises event,” office time should also be used for staff to spend time together and build relationships with each other, said Travers. For MESHD, a key reason for the hybrid work model is to forge a strong company culture and sense of community via employees’ in-office time.

Jordan agrees, noting that “the need for social interaction is very important.”

To encourage it, Coca-Cola has begun offering events at the office such as free lunches in the cafeteria, a summer festival that includes employees’ family members, and a bar serving alcoholic beverages.

“Each employee is now used to making sound decisions as to how they can best produce outcomes as an individual and a team in a hybrid working environment … the approach is a key driver of engagement and continued retention.”

Most important though, Covid-19 and the workstyles adopted to mitigate it have boosted understanding of, and a desire for, greater DEI in business.

EY Japan’s Umeda said people’s own challenges during the pandemic had made them “recognize the importance of inclusiveness, equity, and respect for others.”

The Novartis Choice with Responsibility framework has enabled the company to further embrace diverse needs and “look for ways to progress in building an inclusive environment,” said Leitch.

And at Coca-Cola, the hybrid work model is fostering inclusivity. “Returning to the office is all about inclusion,” said Jordan. “Each [employee] has developed personal habits which interact with their professional habits … so we need to be mindful of each individual’s needs and not treat everyone the same.”

MESHD’s Travers also has staff front of mind. The pandemic has enabled him to “come to the realization that it’s the employees who will dictate the future of work, irrespective of companies establishing regulations,” he said.

Indeed, the pandemic has increased employees’ willingness to change employers if they are not satisfied with their workstyle. In June, the JLL Workforce Preferences Barometer found three out of four of the 4,000 office workers surveyed would reconsider their involvement with their company if they wanted greater work flexibility.

Setting up suitable work models and fostering DEI has, therefore, never been so important for recruitment and retention.

Certainly, Travers notes, companies investing “time, money, and resources into their employees’ skills, emotional wellbeing, and job satisfaction will reap the rewards in the future.”

Bridge the Gap

Bank of America’s Tamao Sasada shares her thoughts on DEI, ESG, and sustainable finance

Tamao Sasada says that her grandmother was her mentor. “When I was a kid, she always told me that I would need to have a career with a professional skill set,” Sasada shared. Her advice was based on experience gained as a woman doctor during World War II—something rarely seen during those days—that gave her this wisdom to share with the granddaughter who, one day, would lead Bank of America in Japan.

Sasada was already a career-minded student when she attended university in Japan in the early 1990s, but those words from her grandmother helped her find her path. She chose to study law.

But what should be her next step? Where should she work?

“Back then, some Japanese women who aspired to advance their careers chose to work for US or non-Japanese companies, as these were perceived to be more performance driven and gave women more opportunities to advance their careers,” Sasada explained. “So, after graduation, I chose to become a lawyer in New York.”

From there, her path took her into the world of banking and back to Japan. Today, as Japan country executive for Bank of America and president of BofA Securities Japan, she focuses on business growth for the bank and also devotes considerable effort to promote environmental, social, and corporate governance (ESG); diversity, equity, and inclusion (DEI); and sustainable finance at Bank of America.

Sasada spoke at a fireside chat hosted by the American Chamber of Commerce in Japan (ACCJ) Alternative Investment Committee on September 7, and she later sat down with The ACCJ Journal to share her thoughts on a number of topics, including how Japan can push the DEI and ESG agendas forward.

What are your memories of that first job in New York?

I made the decision to go there knowing that it would be a tough and competitive environment. And it was. I remember walking into meeting rooms and being the only woman—and a young Asian woman—there. That was not uncommon. There were a number of women lawyers at the junior level, but far fewer at the senior and partner levels.

But one thing that was quite eye-opening was the law firm provided a lot of training and development programs, which was something not so common in Japan back in the 1990s. They took time to really invest in junior people, which certainly gave me a solid training and allowed me to excel in my career.

How did you start to grow your career in finance?

The opportunity arose to work for Merrill Lynch, now BofA Securities, the brokerage and investment banking arm of Bank of America. I took a position in Japan.

I’ve been with the company for 24 years. Looking back, it was quite interesting to find that, even in a US organization, the work environment in Japan back then was quite male dominated. Of course, it is very different now. I found myself trying extra hard to make sure that I could deliver, and that people would not judge me on the basis of being a woman.

As an investment banker in Japan, part of the job is to bridge the gap between Japan and our global franchise, identifying clients’ needs and offering our full capabilities.

“Diversity matters because it brings different perspectives. At Bank of America, we believe that the more diverse we are, the stronger and better we are.”

BofA employees join the firm in driving DEI and environmental efforts, such as the Arakawa River Cleanup.

Also, one of the key challenges working for a US company in Japan is that you need to make sure that the Japan franchise is visible and has strong presence, not only in the eyes of clients but also in the eyes of the headquarters in the United States. I believe this is a challenge for everyone who works in a gaishikei (multinational organization) in Japan, regardless of gender.

So, even today, I still think about how best we can serve our clients in Japan and connect the dots between what our Japanese clients need and what we can offer globally. On top of that, navigating the organization and connecting people through business and social relationships have always been important aspects of how I built my career.

Why does diversity matter when building teams?

Diversity matters because it brings different perspectives. At Bank of America, we believe that the more diverse we are, the stronger and better we are. When we connect our diverse backgrounds and perspectives, we can better meet the needs of our colleagues, clients, and communities.

For us, DEI is action oriented. Our chief executive officer, Brian Moynihan, and all members of the management team are very focused on building an inclusive culture where our employees feel comfortable being who they are and bringing their whole selves to work, knowing they have equal access to opportunities regardless of their differences such as gender, ethnic background, or other such factors.

Such a culture has allowed us to attract and retain more diverse talent, and I find this to be true when we recruit in Japan as well as other parts of the world.

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Are there aspects of DEI unique to the financial sector?

In banking, it’s important to bring in different perspectives and skill sets. Our clients are diverse, so we need to be diverse. Also, much of our business is cross-border in nature. For example, in mergers and acquisitions (M&A), our Japanese clients are buying and selling not just in the domestic market but also abroad.

Due to this, we need to work with a lot of colleagues outside Japan. Building connectivity—that’s the term we use—around the organization is important to growing trusting relationships.

So, for a global bank, DEI becomes very important because we need to understand that our clients and colleagues come from different backgrounds with different thought processes. Embracing these differences and removing any unconscious bias is critical for successful outcomes.

That’s why I feel that our company is stronger when we are more diverse in thinking and mindset, and creative in how we bring the business together and leverage the people and platform we have. Clients appreciate this because this allows us to better meet their needs.

How can companies strengthen their DEI?

Our commitment to DEI starts at the top. Our management team sets the diversity and inclusion goals of the company. Each management team member has action-oriented diversity goals, and they are reviewed by the board every quarter.

Our Global Diversity and Inclusion Council, consisting of senior executives from every line of business, meets quarterly to discuss DEI objectives and the progress we are making at each level of the company.

I have been a part of this council as one of the two representatives from Asia, having worked very closely with this leadership team. Over the years, I have witnessed how passionate our leaders are and how hard our company works to narrow the gap in any diversity spectrum.

From a gender perspective, 50 percent of our workforce and more than 30 percent of our management team are women, and we have a very ethnically diverse board. At the end of 2021, our company was one of only nine S&P 100 companies with six or more women on the board.

So, the statistics are strong, but what is equally important is to create a culture where people are given equal access to opportunities regardless of backgrounds, and to put people into their roles because of their capability.

What unique DEI challenges do Japan-based companies face? How can they overcome them?

I think Japan has come a long way. Particularly since former Prime Minister Shinzo Abe’s three arrows and empowerment of women initiatives, there has been progress, such as more women being put into managerial positions. But certainly, more needs to be done. The increasing pressure from investors on broader ESG goals, and the latest update to the corporate governance codes that requires companies to disclose their DEI progress, are all encouraging to me.

In addition, building an inclusive culture is really key to driving DEI. There are a few things that might be helpful in achieving better results. One is male advocacy. The terminology might not be familiar to some. It means men, or male managers, taking ownership of ensuring women are given equal access to opportunities and are supported, including through various programs. Say you have a very capable female manager who is a working mother. It is not uncommon for companies in Japan to offer benefits to support working mothers. What is important is how the male manager supports these colleagues’ career development and encourages colleagues to be understanding. If a company can follow this approach for a period of time, that will result in a robust pipeline of middle-level to senior women managers.

“As the country executive for Japan, driving business growth is one of my principal missions, but creating an inclusive workplace where people feel they can bring their whole selves to work is equally important.”

Tamao Sasada

The second is a strong mentorship and sponsorship program. Different companies might have different mentor programs, but sponsorship is something that may not be so common in Japan. A sponsor is usually someone influential and powerful in the organization who helps a rising talent succeed. They help the individual increase visibility within the company, speak up for them, and assist them through advancement opportunities.

Also important is building a meritocracy culture. Put people into the role because of what they can do, regardless of their backgrounds.

How did you overcome career obstacles?

Fortunately, at Bank of America, the culture has always been supportive. My motto is, when you are given the opportunity, always try to go out of your comfort zone and give it try.

When I was a junior banker, I was given the chance to become a coverage banker for one of our biggest clients in Japan at the time. It was unusual for a junior banker to be given such a big responsibility, but I believe my manager trusted that I could do the job and took a chance on me.

I worked extra hard to ensure I delivered for that client, who had a lot of doubts about me at the start.

This client aspired to expand the business globally. To help them, even though I was still junior, I fearlessly reached out to colleagues around the world to get help. That was a great opportunity to get to know people in the organization, understand what we could do globally, and deliver what the client needed.

This client was happy with the outcome and became one of my advocates.

So, the lesson learned was to go out of your comfort zone. There are always learning experiences that come out of doing so. And once you have experienced that, you can pay it forward.

Why is stakeholder capitalism important?

Stakeholder capitalism is a term defined by the World Economic Forum half a century ago, which has gained renewed focus in recent years. It essentially means companies must deliver not only for shareholders, but also for all stakeholders including clients, employees, and the wider community.

This is something our company really believes in, and it has been reflected in our corporate philosophy for many years. We have a corporate strategy called Responsible Growth, which states that we are here to serve wider stakeholders. DEI is always part of that strategic focus, and ESG as well.

How does DEI tie into ESG and sustainability?

DEI is part of ESG, which has been a long-term focus for us, even before the term became so prevalent.

This goes back to our Responsible Growth Strategy, delivering for all stakeholders. And that is really the core essence of the stakeholder capitalism that we talked about.

As mentioned, there has been a renewed focus on stakeholder capitalism in the global business community. Our CEO, who is a passionate advocate of ESG, has been chairing the International Business Council at the World Economic Forum, leading global companies in pushing ESG standardization forward.

In recent years, more focus has been put on the E, the environment, with more than 130 countries and many companies having pledged their net-zero goals.

At Bank of America, we announced our goal of achieving net-zero by 2050. The urgency is felt in both the private and public sectors globally. Just like our role in helping accelerate ESG in the global business community, Bank of America is taking a leadership role in the net-zero transition through sustainable finance.

About a year ago, we announced a $1.5 trillion pledge to mobilize capital to support clients’ ESG efforts. That’s $1 trillion for climate transition and another $500 billion to promote social inclusion, such as racial and gender equality, healthcare, and education.

What is sustainable finance? Why is it important?

We believe that the finance sector has a key role to play in providing and mobilizing the capital needed to drive the transition to a low-carbon, sustainable economy. A lot of our clients are making net-zero pledges, and they are working hard to come up with a roadmap to carbon neutrality. Our mission is to support them through sustainable finance, such as providing green loans, helping clients issue sustainability or green bonds, or advising on M&A transactions in the renewables space.

We do it ourselves as well. Bank of America was one of the first financial institutions to issue green bonds and sustainable bonds. During the past two years, we issued one of the first Covid bonds and sustainability equality bonds to help advance many of the social issues we saw in the past few years.

How do you see the future of DEI in Japan?

Certainly, progress has been made. We must keep driving that culture of change. Within each organization, it’s important to follow up on initial efforts. Much has been done, but focusing on some of the things I mentioned earlier—meritocracy culture and initiatives such as a sponsorship and mentorship program—are definitely key steps. It’s great to have maternity and paternity programs as well as a support system for working mothers, but building a supportive and inclusive culture is equally important.

As the country executive for Japan, driving business growth is one of my principal missions, but creating an inclusive workplace where people feel they can bring their whole selves to work is equally important.

I look forward to seeing companies in Japan continue to drive these efforts forward and create inclusive cultures that will promote further acceleration of DEI.

Changed Reality

US Ambassador to Japan Rahm Emanuel shares his views on the state of the bilateral relationship

Photos by Miki Kawaguchi/LIFE.14

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When Rahm Emanuel arrived in January as the 31st US ambassador to Japan, he wasted no time in building new connections and strengthening existing ties between the two countries. His experiences as mayor of Chicago, President Barack Obama’s chief of staff, a member of the US House of Representatives, and senior advisor to President Bill Clinton coalesce into a whirlwind of diplomatic energy. He has already visited 10 of Japan’s 47 prefectures and attended events stretching from Hiroshima to Otsuchi, in Iwate. And his love of trains and use of the country’s mass transit has captured the hearts of Japanese media.

On May 16, Emanuel took time out from this fast-paced schedule to speak to members and guests of the American Chamber of Commerce in Japan (ACCJ). Organized by the ACCJ Government Relations Committee, the luncheon at Tokyo American Club saw more than 200 in-person and remote attendees listen as the ambassador shared his thoughts on Japan and the great potential for the bilateral relationship. Emanuel also graciously responded to a range of questions during a lengthy Q&A session.

Following a welcome from committee Vice-Chair Anne Smith, ACCJ President Om Prakash delivered opening remarks. Noting that the ACCJ, as the voice of the US business community, has enjoyed a close and valuable relationship with the US Embassy, Tokyo, over the course of the chamber’s nearly 75-year history, he said, “I can’t think of a better person at the right time in the right place than this man.” In response, the ambassador quipped, “Intros like that make you wish your parents were here, because you know your mother would be proud and your father would be amazed.”

Impact on Investment

Emanuel began by noting that, after two years without an ambassador to its most important ally in the most important region, the White House and President Joe Biden are placing great value on Japan. The bilateral relationship, Emanuel believes, is at an inflection point. “We are no longer discussing, as we have for the past 40 years, alliance protection. I think the US–Japan relationship has matured into alliance projection,” he explained. “Yes, it’s about the two countries, but it is about the two countries projecting forward into the region in a shared way.”

As he said this, the embassy was preparing for Biden’s May 22–24 visit. That the trip took place so soon after the ambassador’s arrival highlights how their long working relationship energizes efforts to build cooperation with the administration of Japanese Prime Minister Fumio Kishida.

Stable, Sustainable Business

The challenges facing the world are many, and some are shaking the foundations of long-held approaches to business operations.

Emanuel said he feels we are transitioning from neoliberalism to a world in which consideration of potential conflict and political turmoil must play a key role in corporate decisions.

“There have been three major events that have shaken people and their calculations of what is going to be the road going forward,” he said. “And it’s a level of uncertainty, and an intensity of uncertainty, that really hasn’t been experienced in a long time when it comes to international affairs and international economics.

“My own view is that low cost and efficiency, which have been the guiding North Star for your individual companies for how you make investments, where you make investments, etc., those North Stars are slowly but surely … being replaced by stability and sustainability. No company today making a major decision economically, internationally, is going to be stuck with a major investment in an insecure, unstable political environment, a country that can one day have major sanctions [placed] on it,” he continued, alluding to the fallout from Russia’s invasion of Ukraine and the potential for future conflicts.

New Calculus

The coronavirus pandemic, he noted, has already exposed the fragility of supply chains, and the war in Ukraine is having a similar impact in how it raises concerns over uncertainty in and around political systems, even in democratic countries. “You’re going to start to change the calculus of how you make investments, based on whether a country is politically stable and if it lives by the rule of law. Does it have the resilience and sustainability that you need as a company?”

Speaking of uncertainty as it pertains to international trade, Emanuel said that we are witnessing the emergence of a new political and economic equation, one that will become clearer over the next five years. To stability and sustainability he added resilience. “Each of those, in some way, becomes more dominant in how we think about political decisions, commercial decisions, and economic decisions.”

He closed by saying that he feels we have a unique opportunity to advance US–Japan relations.

“I said when I was confirmed, I think that what we do in the next three years, as the US and Japan, will determine our relationship for the next 30.”

The ambassador believes that, if Kishida emerges victorious in the July elections, Biden has a chance to build a solid foundation with the Japanese prime minister, with whom he came to be on a first-name basis after they had spent just one day together in May.

Emanuel knows what can happen when there is instability at the top, and how that can impact the bilateral relationship. As Clinton’s senior advisor, he saw six Japanese prime ministers come and go in eight years. “As soon as you started to get to know somebody, they were gone,” he said. “There’s a chance President Biden will have one prime minister for his tenure,” he continued. “That’s a unique opportunity not only to develop a relationship but [to work with] a person who, without an election overshadowing decisions, has the ability to make some real decisions for the future of the US–Japan relationship, including as it relates to the Indo–Pacific.”

To that end, Emanuel applauded Kishida for his leadership in the face of recent global uncertainty.

“One of the things I think Prime Minister Kishida has done very successfully is he has taken the Indo–Pacific and the Transatlantic and collapsed them into a single strategic sphere,” he said. “Just in the past 10 days, he’s hosted the European Union president, the Finnish prime minister, the chancellor of Germany and, two days prior to that, on his visit to Europe, he was with the British prime minister, the Italian prime minister, and the Pope. That should be seen as a way in which Europe now has a vested interest in a free and open Indo–Pacific. That is a major change of where we are politically and a major change of where we are economically.”

Concluding his speech, Emanuel told the crowd: “I look forward to the next three years working with each of your companies and promoting not only your commercial interests but, more importantly, our shared interests.”

Digitizing Women’s Health

Startups and entrepreneurs leverage tech to improve care and equality for women in Japan

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In recent years, Japan has seen a boost in femtech. The portmanteau of female and technology refers to services using tech and products that help improve women’s health. Government support and media coverage have enabled femtech business offerings to move from niche to mainstream. But how soon might the fledgling industry take off as it has in the United States and Europe? The ACCJ Journal spoke with experts to explore prospects for femtech in Japan.

In 2021, the word femtech was nominated for publisher Jiyu Kokumin Sha Co., Ltd.’s Word of the Year, an annual award for language best representing life in Japan over the previous 12 months. The word eventually lost out to phrases related to US-based baseball superstar Shohei Ohtani, who made a splash in 2021. Yet the nomination alone is significant.

Awareness of femtech has remained low in Japan since the term was first coined in 2016 by Danish entrepreneur Ida Tin, founder of period- and fertility-tracking app Clue. But 2022 might see that change.

A February 2021 survey by Sompo Himawari Life Insurance Inc. shows that only 1.9 percent of its 1,000 working female respondents recognized the term. Once it was explained to them, however, more than half said they were “interested in” or “hopeful” about the concept.

Fast-forward to year-end, and 47.5 percent of respondents said they were aware of the word femtech. Though this is positive for the market, a Statista survey of 3,068 girls and women carried out in December 2021 and January 2022 also shows a long way to go, as just 15.3 percent of those polled report knowing the meaning.

Raising Awareness

Still, the increase is welcome for industry players. They say the market can grow only with an uptick in public awareness of, and willingness to talk about, women’s health—a topic that remains taboo in Japan. Progress over the past 12 months has been attributed to the launch of new products and services, exposure in media and social media, events, and other activities that support conversations about women’s health.

In March 2022, awareness-raising events Femtech Japan and Femcare Japan were held in Tokyo, while Japan Sports Week 2022, an industry event held in May, saw an area dedicated to femtech products and services supporting women in sports.

Promotion has already begun for Femtech Tokyo, an inaugural event to be held October 20–22 at Tokyo Big Sight, Japan’s largest international exhibition center. It will usher in what are expected to be annual trade fairs, designed to welcome the general public and businesses interested in “solving various problems in women’s life stages,” according to organizers.

“The term femtech is getting more recognition among women in Japan than ever before,” said Yoko Fukata, investment director at Sony Innovation Fund, which supports femtech startups in Japan. “Women want to know how their body works, such as its rhythms and hormones, and [want] to live better lives … exposure of the word and its different solutions will catch women’s attention.”

Indeed, consumers have been quick to notice femtech offerings entering the market. Almost 80 percent of some 10,000 working-age women in Japan said they knew of at least one femtech product or service, according to a 2021 Statista poll. Most familiar were sanitary shorts (48 percent), cloth sanitary pads (47.9 percent), ovulation test kits (40.9 percent), period tracker apps (40 percent), and sleep bras (38.3 percent).

These products are the result of several early stage femtech startups that emerged in 2019 and went on to release products and services in 2020 and 2021 in what can be considered “the first movement of the femtech industry,” according to Tomoko Minagawa, founder of industry association Femtech Community Japan and a leading investor in the femtech domain.

Improving Gender Equality

Now many players in Japan, including enterprise companies, are starting to launch new femtech businesses, Minagawa explained. Their motivation has been boosted by policies from a national government that sees the femtech industry as one method of addressing the country’s poor record in gender equality.

Japan ranks 120th among 156 nations in the World Economic Forum’s 2021 Global Gender Gap Report, far behind its G7 counterparts (which place between 11th and 63rd) as well as many of its Asian neighbors. The study, which tracks gender equality in four areas, evaluated Japan highly in health and education, but very low in economic participation and opportunity, as well as political empowerment.

Minagawa said the main reasons for Japan’s ranking are the lack of:

• Support for women in balancing their professional and private lives
• Consciousness of the very deep chasm between the experiences of men and women

She added that femtech can empower women by exposing the gap between the need for, and availability of, femtech products and services, and by leading discussions on femtech’s necessity and advantages for society.

Indeed, Minister of State for Gender Equality Seiko Noda, in her message on International Women’s Day 2022, listed “promoting femtech” as a government measure to improve Japan’s gender equality performance. Boosting women’s health by supporting the femtech industry is part of its efforts for “the realization of a society in which women live with dignity and pride,” one of the Japanese government’s four pillars in its Fifth Basic Plan for Gender Equality.

Government support includes the Subsidy Project for Demonstration Projects for Femtech and Similar Support Services that distributed a combined subsidy of ¥150 million to 20 femtech companies in 2021. According to the Ministry of Economy, Trade and Industry, which runs the program, the goal is to prevent events, such as the unwanted turnover of working women (triggered by life turning points, including pregnancy, childbirth, and menopause); to improve the well-being of individuals; and to increase the diversity of human resources at companies.

A healthy femtech industry, therefore, supports not only a societal need, but an economic one.

Business Cost

Loss of productivity, resulting from improperly treated health issues experienced by women working in Japan, is estimated at ¥2.7 trillion ($20 billion). According to Minagawa, the figure includes ¥323 billion ($2.4 billion) from menstruation, ¥672 billion ($5 billion) from fertility, and ¥1.75 trillion ($13 billion) from menopause.

With employees’ physical and mental health front of mind due to the acceleration of new work styles stemming from the pandemic, many companies are looking to the femtech industry for solutions to some of Japan’s long-running problems.

Kathy Matsui, general partner of MPower Partners, Japan’s first global venture capital fund focused on environmental, social, and corporate governance, told The ACCJ Journal that health and well-being has “become the priority” for more companies, particularly during the pandemic.

Startups have responded well. For example, lots of them have emerged that measure employee stress—now a legal requirement for companies in Japan. In the area of mental health support, companies are offering services, such as the outsourcing of care for children and elderly parents, she added.

Yuko Kidoguchi, operating officer and head of communications at life science company Bayer Holding Ltd. (Japan), which is active in women’s health policy advocacy, is also seeing more companies supporting the health and well-being of staff. Some are providing education on women’s health topics, including infertility treatment for women and men. Others are connecting female employees with gynecological care or providing financial support for women’s health treatments.

It’s all part of improving productivity and carrying out healthy management, Kidoguchi said.

Gradual Growth

With the needs and demand for femtech in Japan firmly established, what does the future hold? Japan’s femcare and femtech market grew from ¥57.5 billion ($428 million) in 2019 to almost ¥60 billion ($448 million) in 2020, and further development of the market is projected to generate an economic impact of about ¥2 trillion ($14.9 billion) in 2025, according to Statista.

In global terms, though, Japan’s market is tiny, with Asia accounting for only eight percent of the world’s femtech companies. Compare that with North America, which is home to 55 percent.

Sony Innovation Fund’s Fukata predicts that Japan’s femtech market will “grow gradually, not exponentially,” in part due to there being fewer female founders and investors than in the United States and some other countries.

Still, the industry consensus is that women femtech founders can make a big impact in both this industry and the wider healthtech domain.

“Women are often key decision-makers when it comes to household spending, and this is especially true in Japan,” according to Nuala Connolly, co-chair of the American Chamber of Commerce in Japan (ACCJ) Women in Business Committee and an ACCJ governor, as well as being head of talent, and the regional diversity, equity, and inclusion lead at AIG Japan Holdings. “Having women in leadership positions in startups and in femtech—and in every other sphere of business—means having leadership who represent this important consumer base and can innovate directly to optimally meet the needs of women. This, in turn, leads to the development of new products and markets, and boosts and elevates the overall economy.”

Fukata also cites the general population’s lack of deep understanding and the early stage of the industry as dampers on femtech growth, alluding to the fact that most femtech companies are focused on femcare, such as period underwear, rather than the technology aspect. She suggests this may be due to data that shows women are most concerned about period-related issues when it comes to women’s health. Alternatively, it might be due to the ease with which consumers can see, touch, and use such products.

“I think [femcare is] the starting point. Once they get accustomed to using those products and get to know more about the industry and the solutions there are in the world, there will be more people who want to focus on using femtech in different stages of their life,” she said.

Femtech Community Japan’s Minagawa agrees that most companies are providing non-tech products and services, but she is seeing some movement in the tech space, such as apps to track period cycles or to chat remotely with medical experts, as well as expansion into fertility treatments and early detection and support of menopause symptoms.

E-MCH

One area of women’s healthcare in Japan that is getting digital attention is the maternal and child-health (MCH) handbook, a printed booklet that can be obtained from a ward office or city hall which is used by doctors to track the results of pregnancy and post-birth health checks.

Lanex Co., Ltd. has developed an electronic version of the process—the E-MCH—an innovation for which the company won the From Japan and Beyond Award at last year’s ACCJ Healthcare x Digital competition.

“We analyzed the actual trend of existing digital healthcare solutions and found that most were not directly applicable to maternal and child healthcare, so we came up with the idea to digitalize the Japanese MCH,” explained software developer and project manager Boubacar Sow. “The E-MCH can play a significant role in tackling public health issues in both urban and rural areas of Japan. Our digital maternal and child healthcare system can collect and manage data from checkups during pregnancy, track the baby’s development, and enable women to communicate efficiently with their doctors and monitor their pregnancies.”

Sow said that femtech and supporting female entrepreneurship contributes to women’s empowerment and helps to achieve gender equality. “Specifically in Japan, femtech will boost the role of women in bettering healthcare and related activities. Femtech can be seen as one of the pillars of achieving gender equality in healthcare and bringing equal opportunities to women.”

The Road Ahead

There remains a long way to go, however. A full-fledged femtech market includes all kinds of hardware and software, including:

• Medical devices
• Wearables
• Telehealth and digital platforms
• Therapeutic drugs
• Vitamins and supplements

These items support everything from menstrual and reproductive health to pelvic, uterine, and sexual health to wellness and longevity.

Reaching that stage might not be smooth sailing, though, according to Dr. Amina Sugimoto, CEO of Fermata Inc., a platform and ecosystem designed to help domestic and overseas femtech companies enter the Japanese market.

Pointing to a lack of understanding, she explained: “People think there is nothing in the market and try to come up with their own services. But the problem is the market is not there.” She added that it is unlikely the 90 percent of women in Japan who choose sanitary pads during their period would be interested in a device to predict fertility if it requires insertion.

Consumers are also largely unaware of, or uncomfortable discussing, what their personal health issues might be, Sugimoto added. But she aims to change that with Fermata’s mission “to turn taboos into triumphs” by facilitating more openness on women’s health.

“If people could talk about [women’s issues] more freely, the market would slowly start to grow—companies and startups would get ideas to come up with new products,” she believes.

The public would also benefit from understanding women’s bodies better, said Kidoguchi, a vice-chair of the ACCJ Healthcare Committee and the brainchild behind Bayer’s gynecological health education program in Japan. Inspired by the country’s limited female health literacy and access to gynecological care compared with what is available in other nations, the program has been delivered to more than 50,000 students in 200 high schools, from Hokkaido to Okinawa, over the past seven years. Such schemes that educate both men and women can act as seeds for the future growth of Japan’s femtech market by creating more individuals who are open about, and understand, women’s health issues.

Minagawa said the current lack of understanding and cultural non-acceptance by investors, mainly dominated by men, is the structural impediment for investment in the femtech domain in Japan.

This was one driver for her to establish Femtech Community Japan, which connects investors, startups, enterprises, research institutions, government, and media for networking and discussion.

With the growth of such forums that support the development of an open conversation around femtech in Japan, it surely won’t be long before the term graduates from its current status as a year-end listing on language trends to being a topic of everyday conversation.