Supplier D&I

WEConnect International’s three-year journey in the Japanese market

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While there is much talk in Japan about diversity and inclusion (D&I) in the workplace, another important, though less-discussed, aspect of D&I involves suppliers. Some major companies have long championed diversity in their supply chains, but the issue is now getting more attention—and progress is being made—thanks to the efforts of socially conscious leaders.

This was the topic of a November 25 virtual event, hosted by the ACCJ-Chubu Programs Committee and entitled Supplier D&I: Three-Year Journey in the Japanese Market. Speaker Setsu Suzuki, chief executive officer and founder of Hunext, Inc., shared how sourcing from women-owned startups is shaping the Japanese economy.

Connecting Women

Suzuki is the Japan project director for WEConnect International, the Washington, DC-based non-profit organization (NPO) that expanded its certification and market access activities to Japan in 2018. She recalled how, in 2017, she was invited by Gary Schaefer, principal officer at the US Consulate Nagoya, to attend the Global Entrepreneurship Summit in Hyderabad, India. Some 6,000 women business owners took part in the three-day event. There she had her first contact with WEConnect International, which helps drive money into the hands of women business owners by enabling them to compete in the global marketplace.

“That’s fantastic, right?” Suzuki exclaimed. “So, I immediately said that I want to be a member of this organization.” After getting to know leaders of the enterprise during the summit, she was asked to become the director of WEConnect in Japan. Three months later, she signed a contract with the international body and led its expansion into the market. Noting that WEConnect International is the only certifying body in the world that supports supplier diversity, Suzuki explained that there are five categories:

• Women
• Challenged
• LGBTQ
• Racial minority
• Veterans

“And women are really key,” she said. Globally, just one percent of procurement by governments and corporations goes to women-owned business.

“WEConnect International began studying this 12 years ago, but the number is still only one percent. We want to push it to two percent,” she explained.

“According to a World Bank report, 32–39 percent of companies around the world are owned by women. So, definitely, women are key to a diverse economy.”

Next, Suzuki introduced the companies among WEConnect International’s 143 member buyers that are most active in Japan:

• Accenture
• Johnson & Johnson
• Intel K.K.
• IBM Japan, Ltd.
• EY
• P&G Japan G.K.
• Microsoft Japan, Co., Ltd.
• Micron Memory Japan, G.K.

“More and more Japanese corporations are starting to pay attention to supplier diversity,” she said.

Where Are the Women?

There are 3.8 million small businesses in Japan, but only 500,000 are owned by women. What constitutes a woman-owned business (WOB)? It seems straightforward, and Suzuki noted that we use the term a lot in English.

But to make it clear what this means by definition, she explained that it should be “an incorporated company with at least 51 percent of the business owned and managed, or governed, by one woman—or more.” The WEConnect certification standards state that ownership “is determined based on title to, and beneficial ownership of, stock, membership interests, or other equity in the business.”

WEConnect allows self-declaration as a WOB. Such registration in their database is free and carries limited benefits.

“WEConnect International … helps drive money into the hands of women business owners by enabling them to compete in the global marketplace.”

There is also the Women Business Enterprise (WBE) designation (pronounced “weebee”). This certification opens the door to the procurement departments of 143 member companies and enables business owners to connect with 12,000 women entrepreneurs in more than 110 countries.

In this case, there is a fee, and membership includes unlimited access to WEConnect benefits. The money is used to fund the NPO’s operations, which are driven by three pillars: certification, connection, and education.

Three-Year Journey

WEConnect International’s launch in Japan took place three months after Suzuki took on her role as country director. The expansion into Japan was made possible through the Strengthening Market Access for Women Business Owners initiative, a consortium that includes Accenture, Intel, and Johnson & Johnson. The founding members are working closely with WEConnect to leverage its powerful global networks and experience working with women business owners, and there are now 28 certified WBEs in Japan.

The launch was marked by a hybrid event, making it possible to connect women business owners from Hokkaido to Okinawa. It was supported by the American Chamber of Commerce in Japan, and Women in Business Committee Vice-chair Makiko Tachimori (Fukui) helped facilitate.

A business-to-business matchmaking event was held on November 26, 2020, in which 10 member buyers, 14 tier-one corporations, and 51 WOBs and WBEs participated. Suzuki said that three women business owners got contracts following the event, showing how even online meetings can really make business happen.

The session will take place again in February—rebranded as the P&G Academy Women’s Entrepreneurs Business Development Program—as an eight-day intensive series.

With the support of Johnson & Johnson and Dell Technologies, WEConnect conducted a survey of 191 Japanese female entrepreneurs in Japan between August and September 2020. According to results, the top challenges faced by WOBs are:

• Balancing work and family (65 percent)
• Gender discrimination (30 percent)
• Market entry (11 percent)

She also noted that many women who responded to the survey cited the issue of surnames as an obstacle to their business lives. Because Japan continues to require that women take their husband’s surname, some women said that they must use a false name in work, so that their husband’s family will not discover that they are entrepreneurs—a role that goes against traditional views of a woman’s place in society.

On the brighter side, Suzuki said that WOBs in Japan are thriving across a wide range of industries. Many fall under the United Nations (UN) Sustainable Development Goals (SDGs), which are an important part of WEConnect International’s activities. The organization is working with governments, the UN, and others to help achieve SDG number five: gender equality in the economy.

Japan WBEs

There are only 28 certified WBEs in Japan, but Suzuki is dedicated to expanding that number. She introduced two success stories during the event, starting with Yuko Takahashi, president of Osaka-based Japan Engine Valve Mfg. Co., Ltd. Known by the brand name Dokuro, the company began producing engine valves in 1949.

Takahashi, who was unable to attend due to a business event, delivered a short, vibrant video in which she flew a drone around the Dokuro offices and production facilities to explain how her company makes after-market auto parts. The parts are shipped around the world to meet the needs of those who own Japanese cars.

Setsu Suzuki

Ayako Mochizuki

Yuko Takahashi

Next, Ayako Mochizuki, a Japan native who moved to the United States at the age of 22, shared her experiences running a small and medium-sized enterprise in Japan, doing business with large companies on a global basis.

In 2014, she became president of IBS Japan Co., Ltd., the 35-year-old value-added reseller of data communication products, founded by her father. She runs the company from her home in Boulder, Colorado, while her father remains involved as an owner in Ebina, Kanagawa Prefecture, where the corporate headquarters is located.

IBS Japan’s mission is to make life easier through the application of technology, and the company was certified as a WBE by WEConnect International in 2019. “Since then, I have had many successes [as a result of] being a WBE,” she said. One such success, she noted, involved the sale of thermal camera technology to a major pharma company soon after the start of the coronavirus pandemic.

Despite these successes, challenges remain—particularly with traditional mindsets about gender roles in business. Mochizuki shared an interesting example from within her own company.

“When I got certified [as a WBE] in 2019, one of my employees—a key person for me—actually told me that I should not be certified,” she recounted. “He said that if we are certified, if they find out that I’m a feminist—that’s the word he used—we are not going to get business, because it’s a male-dominated industry that we serve. He was very concerned.”

She noted that this worry is real in Japan, because the country remains very much dominated by men, and many of the business leaders are aged 60 and over.

So, the shift in mindset takes time. But through the efforts of Suzuki, WEConnect, and women business owners such as Takahashi and Mochizuki, that change is taking place.

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Hidden Treasure

Can women overcome obstacles to fill Japan’s tech gap?

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The Japanese government calls it a “digital cliff”—a projected shortfall of 450,000 engineers, programmers, and other tech workers needed by 2030 to undertake the country’s digital transformation.

Harnessing the largely untapped potential of Japanese women—who are drastically underrepresented in science, engineering, and computer programming jobs and college degrees—could help narrow that gap.

“Authorities realize they face a big labor shortage, and some people talk about opening up immigration. But, already, we have a huge resource: Japan’s hidden treasure is the power of women,” said Annie Chang, vice-chair of the ACCJ Independent Business Committee and head of IT recruiting company AC Global Solutions Ltd. In 2013, Chang co-founded Women in Technology Japan, a group dedicated to boosting female participation in the tech industry through workshops and mentorships.

And yet women face a host of obstacles—cultural, educational, corporate, and familial—that keep them from playing bigger roles in technology. As a result, Japan has a large digital gender gap, with some of the lowest shares globally of women in tech jobs and college programs, even compared with many developing Asian nations.

According to UNESCO data, just 14 percent of university graduates with engineering degrees in Japan are women. Compare this with 20.4 percent in the United States, 24.5 percent in the Philippines, and 30.8 percent in India. Among engineering researchers, Japanese women account for just 5.6 percent. That’s left a dearth of female role models to inspire girls about their futures.

“It’s embarrassing,” said Asumi Saito, 30, who co-founded Waffle, a non-profit in Japan that works to support teenage girls interested in science and technology at a critical juncture in their lives, when they must choose between pursuing science or humanities tracks in high school.

“I’m hopeful about the younger generation,” said Saito, who believes that bringing more women into technology will benefit the broader economy and society. “It will lead to greater diversity in innovations and, likely, more humane applications of technology in areas such as health and childcare.”

Allowing women to play a bigger role in the tech industry would “lead to so many more business opportunities,” said Yan Fan, a software programmer who previously worked in Silicon Valley and, in 2017, co-founded coding academy Code Chrysalis, which runs intensive 12-week programming boot camps in Japan. About a quarter of its students are women. Fan and her academy were featured in the April 2019 issue of The ACCJ Journal.

“The message I want Japanese women to have is: ‘You are 50 percent of one of the most powerful economies in the world. You are a significant part of the workplace,’” Fan explained.

And that could lift Japan on the IMD World Digital Competitiveness Ranking, where the country languishes at 28th globally and seventh in Asia, behind Hong Kong, Singapore, China, and South Korea.

Systemic Change

But Japan’s digital transformation could leave many of its women behind. Those at home with children, or who are middle-aged, have little chance to learn new in-demand skills, such as programming, machine learning engineering, and data science.

That’s a global concern: as automation takes over low-skilled jobs around the world, women stand to lose more than men, the 2021 UNESCO Science Report warns.

Fan isn’t confident that Japanese society can shed the constraints and cultural assumptions that impede women. She points to the oft-heard microaggression, “Even a housewife can do this,” as an example of the mindset that grips Japan. “When you hear those kinds of things day after day, it becomes ingrained in you.”

Systemic change is needed, Fan said. “The onus seems to fall mostly on women. There’s little talk about all the other changes that need to happen for women to actually make the space in their lives to learn new skills. So, I think women will fall further behind as the country digitizes.”

Still, Fan is optimistic about Japan’s potential—and the wider impact it can have. “If we can elevate women in this society, we can create reverberations throughout the world just due to the sheer size and power of Japan’s culture and its economy.”

Mindset Change

There are signs of modest progress. Compared with 20 years ago, there’s greater awareness of diversity, and companies are taking steps to hire and promote more women. That’s thanks partly to former Prime Minister Shinzo Abe’s promotion of Womenomics, a term he apparently borrowed from Kathy Matsui, the former Goldman Sachs Japan vice-chair who, earlier this year, co-founded MPower Partners, Japan’s first venture capital fund focused on environmental, social, and corporate governance (ESG). “Just the fact that diversity is part of the vernacular is a huge step forward,” Matsui said.

But, more importantly, there’s been a mindset change at some corporations. Leaders have realized that giving women bigger roles in projects and leadership isn’t just a human rights and equality issue, but a driver of economic growth, she added.

“If you don’t think diversity is a competitive and growth imperative, it really isn’t going to get any traction,” she said. “But if you think it is a weapon for growth and a competitive advantage, and you filter that down through your organization, you can get buy-in. Then you can start to change how you recruit, how you evaluate, how you promote. That’s the only way you’re going to get women into those leadership positions.”

One step in this direction is the appointment of Yoko Ishikura, professor emeritus of Hitotsubashi University, to be the No. 2 official in charge of Japan’s new Digital Agency.

The number of women seeking and finding jobs in the tech industry is slowly growing. Of the 27,300 candidates placed by tech recruiting company Wahl + Case since 2014, the portion who are women has risen from 27 percent to 38 percent, explained founder Casey Wahl. However, women make up 14 percent in highly technical positions such as software coding, he said; more go into marketing and product design.

Women who do land tech jobs find they pay better than work in many other industries. The average annual salary for candidates recently placed by Wahl + Case has been about ¥9 million ($80,000).

Compared with 20 years ago, Wahl said he sees major changes in the role of women in the workplace. “There’s a big trend going on, a generational time shift,” he noted. “The people in their thirties and forties—when they get into power, then things will change even more.”

The combination of soaring demand for tech jobs and greater commitment to diversity presents women with an opening—provided they have the right skills. “Women have a great opportunity now,” Chang said. “But the pipeline is so small. How do you increase this from the grassroots level?”

Home Front

Parents and teachers have the biggest responsibility in nurturing—or discouraging—girls’ interest in science, math, and computers, Chang, Matsui, and others said.

When Chang asks Japanese female engineers who had the biggest influence on their career choice, the frequent response is their fathers. Ironically, it is more often their mothers who tried to dissuade them, she explained. “The moms are generally stuck at home, so they don’t have much exposure to technology. They’re not very encouraging of daughters who are interested in science and don’t think the image is very good.” Some even worry about their daughter’s marriage prospects if they pursue an engineering career.

Even today, there is a persistent bias in Japan that girls aren’t particularly good at science and math. Parents and teachers may express such views, and girls pick up cues from anime and TV shows that tend to portray boys tinkering with robots or computers, but not usually girls.

Those images can influence girls’ self-image and confidence, said Miki Ito, 38, an aerospace engineer and general manager at Astroscale, which is engaged in removing space debris circling Earth. “There’s the idea that if you go study science at university, it’s full of men, or it’s really difficult,” she said.

Ito’s parents were surprised but supportive when, as a teen, she expressed a desire to study space. Her only model was Chiaki Mukai, Japan’s first female astronaut. In college and graduate school, most of her college classmates and all her teachers were men, but Ito said she didn’t encounter any discrimination.

“I actually think women are well-suited to programming. It involves setting up steps to carry out a plan, like going on a trip. Women are good at that kind of planning for their families,” Ito said. “As more women take these IT jobs, they will become role models for the younger girls, who will realize they can do those jobs.”

Digital Future

To prepare Japan’s youth for the digital future, the government now requires computer programming to be taught in elementary schools. At that age, boys and girls are equally enthused about technology, said Haruka Fujiwara, 34, who has been teaching and coordinating programming classes at her school in Tsukuba, located north of Tokyo in Ibaraki Prefecture.

“The kids love it. They naturally engage with each other and talk about projects together. Children who were kind of quiet or not very confident now brag about their projects,” Fujiwara said. “I haven’t seen any gender difference in enthusiasm or ability.”

To create projects, fifth and sixth graders use software and tools such as Microsoft Excel and Scratch, a coding language and community developed for children by the US-based non-profit Scratch Foundation. One of their projects measured the amount of carbon dioxide in the air, Fujiwara explained. Seventh graders at her school start learning the JavaScript programming language. “In the upcoming generation,” she said, “I think girls will be using computers just as confidently as boys.”

Until age 15, Japanese boys and girls perform equally well on international standardized math and science tests. But a gap develops once they enter high school and are required to choose between science and humanities tracks. More girls choose the latter, perhaps because science seems daunting or because they are encouraged to do so by their teachers or parents.

The gender gap widens further in college and graduate school, where engineering and tech programs are dominated by male students and teachers. In many countries, this leaky pipeline phenomenon is common: the higher the education level, the fewer the women. But in Japan’s case, the flow narrows to a trickle.

And working women are generally expected to quit once they bear children, removing their ideas and contributions from the marketplace. When women are at home, they have few opportunities to gain tech skills, and tend to settle for part-time, low-paying jobs such as supermarket cashiers—a position that is dwindling as checkout kiosks take over.

While more young mothers are returning to work after maternity leave, finding daycare can be difficult—especially if they have to work late. And working women are still generally expected to do most of the housework and child-rearing, as well as care for elderly parents or in-laws.

To flourish and advance in the workplace, women may need to think more about how to brand themselves—how they can use their unique gifts and strengths to be successful, said Nancy Ngou, an ACCJ governor and co-chair of the Human Resource Management Committee, who is also head of organizational change and diversity at accounting firm EY.

“They shouldn’t have to emulate the male personality,” Ngou said. “Maybe they’re better at networking or building trusting relationships with people. As a leader, those are very important qualities.”

Reframing the Narrative

At Waffle, Saito and her co-founder, Sayaka Tanaka, are trying to change the narrative about technology and gender.

They run one-day camps for girls in middle and high school that cover programming basics and offer career talks, as well as hands-on experiences that emphasize the problem-solving, community-building, and entrepreneurial aspects of technology. “We want to create a safe space where girls can talk about these things freely,” said Saito, 30, who holds a master’s degree in data analytics from the University of Arizona.

Earlier this year, Waffle supported 75 young women who participated in a Technovation Girls contest, in which teams developed and pitched apps to a panel of judges. Many of the apps were intensely practical. One provided advice on where to find vegan food, and another divvied up household chores among family members. Recently, they received a grant from Google to support their work.

Saito said she receives text messages from girls about the opposition they face at home. One said her father refused to pay for her university tuition if she was going to major in data science and told her instead to study medicine—considered a scientific field more suited to women. Another girl said her parents didn’t want her to study physics because they were afraid that she would never get married.

“A lot of these girls don’t have adults around them to listen to them seriously,” said Saito. “That’s a huge problem in Japan.”

Creative and Flexible

Coding academies have popped up across Japan, but enrollment is heavily weighted toward men. Most women simply don’t have the time, money, or inclination to attend.

Trying to make programming attractive to women, Hitomi Yamazaki in April co-founded Ms. Engineer, Japan’s first coding academy expressly for women. With female models and muted purple tones, the website emphasizes the flexibility that programming offers, including working from home. Even the startup’s name is meant to convey the idea that being a female engineer is cool.

“We wanted to avoid the geeky image and stress the creative monozukuri aspects of programming,” Yamazaki said, using a Japanese term meaning craftsmanship or making things. “We also emphasize that programming is well-suited to a woman’s work style—the freedom of working hours and location.”

Applicants to the first class want to change careers or achieve more in their jobs, Yamazaki said, and 70 percent of inquiries have come from women with children. The pandemic has helped both working women and stay-at-home moms realize that working from home is a realistic option, she said.

Ms. Engineer aims to produce graduates who can do full-stack programming, meaning they can design web applications as well as manage databases and servers. The course costs ¥1.42 million, or about $13,000.

Yamazaki has worked to promote her new business among social media influencers, including Yuri Sasagawa, a model, TV announcer, and new mother who recently attended Ms. Engineer’s kickoff event and tweeted enthusiastically about the future opportunities for female engineers.

Elevating Women

Companies embracing diversity have taken various approaches to narrow the digital gender gap. Some have set numerical targets and implemented steps to reach them, while others have focused on changing hiring and promotional practices.

ACCJ member company Hitachi Ltd. recognizes that the input of women is essential to address consumers’ needs, said Tomoko Soma, a manager at the company’s diversity and inclusion development center. “Our entire business is changing, and we are not trying to sell products as much as services that provide solutions to everyday problems,” she explained. “To do that, we need a variety of employees coming up with ideas.”

Hitachi, which has been implementing initiatives to support and elevate women for more than 20 years, recently reached two goals: the employment of 800 female managers, who account for 6.3 percent of all the company’s managers, and raising the portion of female senior executives to 10 percent.

By 2030, the company aims to raise the ratio of female senior executives to 30 percent through its long-term plans to identify and develop promising young employees and by absorbing talent through global acquisitions, Soma said.

In keeping with government guidelines, female Hitachi employees can take up to two years of maternity and childcare leave, then come back to the same job. If the women have a hard time finding daycare for their child, Hitachi will help them and can extend the leave for a third year. “In situations where there are no nursery vacancies, we don’t want women to quit their jobs just for that reason,” Soma said.

Changing Hiring Practices

Online marketplace Mercari, launched in 2013 and one of Japan’s most successful startups, decided not to set numerical targets for women because doing so might lead to mistaken notions that some women were hired just to meet a quota, said D&I Strategy Team Manager Hirona Hono. “People may feel that they have to reach the goal for the sake of reaching the goal, instead of addressing the fundamental problem behind why this is happening,” she said.

Instead, the company has changed its hiring practices by expanding the pool of candidates to include as many qualified women as possible through recruiting events, women’s coding groups, and other methods. It also has installed checks in the hiring process that might detect bias. Human resources staffers check the pass-through ratios of male and female candidates after each interview to see if there’s any significant disparity and discuss the results with division leaders, she said.

Hono also added a series of diversity questions to the company’s internal promotion recommendation forms, including asking the person filling it out if other candidates from different backgrounds had been considered. If they hadn’t been, she wants to know why. “These questions keep people accountable,” she said.

At EY, while female employees are out for maternity leave, the company offers them a tablet so that they can stay connected to their peers and do e-learning if they want to stay up to speed, Ngou said. The company also provides women returning after maternity leave with an independent coaching service to help them work out daycare, their schedule, and the career they want when they return.

For real change to occur, Ngou said, there must be genuine commitment by the top of the organization—usually a man—displayed in public and behind closed doors. “If the leader doesn’t take it seriously, isn’t active in it, and doesn’t hold his other male leaders accountable for advancing women, nothing’s going to happen.”

Once the top adopts a change, the middle managers can confidently carry out the policies throughout the company, Ngou explained. “The top is so important. Change happens middle-out in Japan. But without the top leader voicing it, nothing will happen.”

Not a Sense of Crisis

The Japanese government has come under fire for doing little to address the shortage of women studying and training for jobs in technology—especially since doing so would help the country meet its digital transformation goals. One suggestion mentioned by several people interviewed for this story was to offer scholarships for female students interested in studying engineering.

“There’s still not a sense of crisis,” said Dr. Jackie Steele, a Canadian political scientist who has lived in Japan for more than 20 years. “I think Japan is going to have to hit an even bigger wall economically before the political and economic elite will admit that there are systemic hierarchies rewarding masculinity, senior age, and ethnocultural purity. These biases must be consciously eliminated. This undermines Japan’s ability to attract diverse talent in a global market.”

To give middle and high school girls exposure to tech workplaces, the government’s Gender Equality Bureau Cabinet Office set up a program in 2015 that promotes events where students can interact with female engineers, including those at ACCJ member company Amazon Web Services Japan G.K., and visit computer labs or university campuses. In 2019, some 36,000 people participated.

To help boost the number of workers with digital skills, the Japanese government offers subsidies that cover 70 percent of the cost of pre-approved training courses in artificial intelligence, data science, and other topics that are offered by private cram schools, explained Takefumi Tanabe, a director at the Ministry of Economy, Trade and Industry. While these don’t target women in particular, Tanabe sees Japan’s digital transformation as an opportunity for women to join the IT workforce.

Husband of the Year

The growth of ESG investing, or funding companies that meet certain environmental, social, and governance standards, can bring investor or market pressure for change, said Matsui, whose MPower Partners runs such a fund. For example, these funds will focus on ESG considerations, such as board diversity, which remains a big challenge in Japan.

“Japan is one of the fastest-growing markets globally for ESG investing. Every asset owner is increasingly focused on how to ‘ESG-ify’ their assets,” Matsui said. So, in addition to examining company fundamentals, fund managers are asking questions about the company’s carbon footprint, as well as its supply chain resilience, child labor policies, employee well-being, and the diversity of the workforce. “To me, the ESG movement is going to be a huge force for change,” she added.

A critical, but almost entirely overlooked, step is to educate and support Japanese men about their changing roles in society—and to celebrate those who are supportive husbands, said Wahl. There are plenty of seminars on what it means to be a working mother, but virtually none on what it means to be a working father. Many men assume that their main role is to work hard and provide for their families financially, although that view is changing among younger men.

“There should be a Husband of the Year award,” said Wahl. “He should get a prize and all kinds of recognition as his wife gives the speech about how she is successful because of what he did. And this has to be seen as cool.”

And if the government is going to offer women scholarships in technology, then it should also offer scholarships for men in caregiving, said Steele. “We need to work on both sides of the equation,” she added. “Men also face gender-based harassment if they stray from the corporate-warrior masculinity model.”

Matsui is encouraged by the differences she sees among the young men with whom she interacts. “They don’t necessarily want to work like their fathers and grandfathers, they don’t want to be slaves to their employers. They want to spend more time with their families. So, their values are more aligned with what many women have been striving for.”

That bodes well for the future. “The younger generation wants a world that is more equal. They want their spouses or partners to maximize their own potential,” Matsui added. “They’re still young, so they’re not necessarily in decision-making roles. But it’s only a matter of time before we see this generation leading Japan, and that makes me optimistic.”

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Tipping Point for Change

Injecting diversity into corporate Japan through outside directors

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Over the past decade, Japan has gone from less than one percent of directors at Japanese companies being female to about 10 percent at many of the larger organizations. And while that figure represents progress, it is by far an inferior diversity-and-inclusion (D&I) performance than typically can be seen at companies in the United States, Europe, and other parts of the world. Some of the largest corporations in France, for example, have boards on which women account for 45 percent of the directors.

How Japanese companies might be encouraged to overcome their apparent reluctance to welcome women into their boardrooms was the topic of a November 15 virtual event, entitled Injecting Diversity through Outside Directors. It was hosted by the American Chamber of Commerce in Japan Women in Business Committee and moderated by corporate governance consultancy Third Arrow Strategies LLC founder Tracy Gopal. The discussion drew on the experience and insight of three women who are committed to bringing change to Japan:

• Jin Montesano, executive officer and chief people officer at LIXIL
• Jenifer Rogers, ACCJ president and general counsel for Asia at Asurion
• Kaori Sasaki, founder and chief executive officer of ewoman, Inc.

In her introduction, Gopal pointed out that women are an increasingly critical part of Japan’s workforce and are needed in boardrooms to help ensure the long-term stability of the national economy. Having women on corporate boards also encourages other female employees to make sure that their voices are represented. It also helps attract the best and brightest.

At present, Japan’s corporate code merely suggests that company boards be balanced in their composition, including in terms of gender. However, this request of sorts cannot sufficiently move the needle when men have deep roots in the corporate culture. Thus women such as Montesano, Rogers, and Sasaki have “a responsibility to be the great change-makers,” Gopal said.

Jin Montesano

Jenifer Rogers

Kaori Sasaki

Tracy Gopal

Relative Progress

The change that has been witnessed in Japanese boardrooms might be considered quite rapid when one takes into consideration many corporations’ reluctance to evolve. But it looks poor in comparison with other parts of the world that have really “accelerated their game,” Rogers noted.

Her experiences on the boards of Kawasaki Heavy Industries, Ltd., Mitsui & Co., Ltd., and Nissan Motor Co., Ltd. have reinforced the importance of the task, and her presence is important on several levels. Female staff have approached her and expressed gratitude that she is changing the company by altering the face of the board. Simultaneously, major investors are keen to see diversity on a board and a willingness to accept non-traditional voices.

Beyond the boardroom, another area of evolution that can be seen is in a company’s internal dynamics.

“We know that diversity is a driver of innovation,” Rogers said. “I personally feel that it’s my duty to speak up and share my views, because that is why I have been chosen to join a board as an outside director. And what I’ve found at organizations on whose boards I serve is that, whereas I used to be the first to ask a question or to share my viewpoint, now I can’t get a word in edgewise.”

Rogers said that what she really likes is how this change has created synergy with top management. “There are more obligations on external directors around sustainability, the codification of the corporate governance code, talking about diversity, and other issues at the board level.”

“Women are an increasingly critical part of Japan’s workforce and are needed in boardrooms to help ensure the long-term stability of the national economy.”

When that takes root, Rogers noted, it can trigger a cascade of change that runs down to every corner of the organization.

“I really think that, when female directors have a lot of confidence and are good communicators, they can truly be agents of change within the board dynamic.”

Yet, too often, a single minority voice on a board is not sufficient to bring about change.

Being the only woman is a difficult position in which to be, Rogers admitted. “What you must do is learn how to have influence and make an impact. For me, that means making friends with the other external directors, which allows me to have a much broader voice.”

One board on which she serves now has three female directors. This, she said, has resulted in a significant change.

“It has altered the dynamic, and we have now hit that magic number which shows there has been a general shift in the organization: it is committed to diversity,” she explained. “If you have three women, then you have enough representation to make a difference. Each woman feels comfortable with that level of diversity.”

Sustaining Change

For Montesano, three key components must be in place to make D&I a truly sustainable endeavor:

• A corporate culture that is genuinely more inclusive
• Credible and authentic leadership
• D&I-focused human resource policies and practices

She agreed with Rogers’ point about reaching a tipping point of minorities on a board, something that LIXIL has been keen to attain.

“Our D&I commitment was to achieve 50/50 gender equity on our board by 2030, and we are already at 30 percent,” she said. “At present, the board has three women. And while one might be [seen as] a quota to make women feel better, three normalizes the situation. Then you’re no longer having a conversation about gender; you’re actually having real conversations as a diverse board. And from there, you go from strength to strength.”

Immediately after being appointed LIXIL’s chief people officer, Montesano said she spent a lot of time examining data and conducting her own research to determine D&I best practices, as well as to tailor a strategy best suited to LIXIL. Her seat on the LIXIL board also enables her to act as a strong bridge between the board’s direction and the company’s D&I strategy.

“What I found is that you must focus on the I, or inclusion, not on diversity,” she said. “If inclusion is the goal, then diversity is the natural outcome.” This, she noted makes real D&I change much more sustainable. That determination has enabled LIXIL to formulate the hypothesis that drives its D&I agenda. The company crafted its approach by asking questions such as:

• How can an inclusive culture be created?
• How can managers demonstrate more empathy?
• How can people best be trained to practice inclusive behaviors?
• How can leadership embrace the actions needed to be genuinely inclusive?
• How can a company eliminate bias from policies, processes, and practices?

A key LIXIL initiative during the coronavirus pandemic has been to maximize flexibility in the workplace for women.

Of course, working from home—something that has been critical during the pandemic—was one element of this, but the company has also stepped up its self- and family-care policies. For example, 10 days have been added to maternity leave, and the entitlement has been made more flexible; an employee can now take the time off in half-day or even hourly increments.

Montesano also called for more women to take the plunge and actively seek promotion to serve on corporate boards. She said that she knows there are women ready to make their voice heard, because she meets them all the time.

“The number might seem small but, in absolute terms, it’s a pretty healthy size,” she explained. “For women who are considering it, I think it is really about putting your hand up to sit on this or that statutory entity internally, then joining outside non-profit boards, which are always looking for talented people.”

Montesano believes this can really accelerate things. “In my own company, my CEO is supportive of me sitting on an outside board. While many other companies may not have considered encouraging it, I hope they will. It would accelerate D&I across Japan and add more gender diversity to boards.”

Growing Curiosity

For ewoman founder Sasaki, there has been visible change in the 35 years since she started her first company, Unicul International. Over the past 26 years, Sasaki’s International Conference for Women in Business has been a catalyst for this change and is widely recognized as spearheading the D&I movement in Japan.

“Compared with 30 years ago, more women are in executive or leadership positions and, at the conference, they like to learn more about diversity, global issues, and how to climb the corporate ladder,” she explained.

Sasaki, who has been serving as an outside board member of corporations for 13 years—and currently sits on the boards of four companies—created the female board-member network called The Board. She noted that most companies continue to believe that they are diverse if they just reach a set number of female employees.

“Diversity is not just a gender issue; diversity of thought is very important for a company’s growth. We need to bring a new angle, a new direction of ideas into boardrooms.”

She added that the public, as well as ESG investors, are asking which companies are performing well on D&I. Such information often influences their investment decisions. But the current rankings only utilize the data which companies choose to make public, so they don’t accurately reflect the true D&I culture at these companies.

To remedy this situation, and to help companies determine the status of their own D&I efforts compared with their peers, Sasaki’s ewoman assembled a group of international experts to design the Diversity Index (DI). The DI measures the diversity of an organization by combining the numerical data with the attitudes and perceptions of every employee and executive through an online survey and exam. It not only reveals the true state of D&I in a company, it identifies training opportunities and serves as a recruiting tool.

Buying In

All three women concluded that the outlook is positive for women in senior positions and also, more broadly, for D&I at Japanese corporations.

Rogers summed it up: “The reality is that, for all companies in Japan, there is demographic pressure. It’s the external competitive market that is driving the use of that pool of talented women in Japan who are highly talented but, at present, underutilized.

“I believe that CEOs and CFOs are now really buying into it,” she added. “They can see how diversity can transform their organization and allow people to really bring their best self to work. The leaders have targets, are measuring, and are increasing disclosure. It really is an articulated priority.”

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My Leadership Journey

ACCJ-Kansai CEO Series: GE's Eriko Asai shares how to stay resilient during uncertain times

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Since 2015, the American Chamber of Commerce in Japan (ACCJ) Kansai chapter has hosted the CEO Series, an annual collection of speaker events featuring top executives from leading companies. The sessions are very popular due to their intimate and insightful nature, and the glimpses they offer into the lives of successful leaders. Attendees leave inspired and with actionable advice to help them improve their work lives, while the candid discussion is especially valuable for young professionals starting to build their careers.

On May 19, Eriko Asai, president of GE Japan and ACCJ chair, spoke at an event co-hosted by the ACCJ-Kansai Business Programs Committee and Diversity & Inclusion Committee. She revealed what she had learned on her way to becoming GE Japan’s first female president.

“Today, I’m going to share with you my leadership journey and some of the challenges I’ve experienced over the years that helped me develop my leadership skills and keep myself resilient during uncertain times,” she said.

The landscape has changed significantly since Asai took the helm of GE Japan in January 2018, and the company currently is undergoing its biggest business transformation of the past 128 years. “One of the most important jobs, as a leader, is to drive the cultural transformation and make a difference,” she noted.

Milestones

Asai opened her presentation with a slide labeled “Leadership Journey” on which she charted the major events in her life and career, beginning with her birth in the UK.

More than just a visual representation of education and job changes, the chart tells a story that Asai believes has great value. “I highly recommend that you write your journey like this, because it helps you reflect on who you are, your strengths and weaknesses, why you think about something a certain way, what you care about, what has been consistent in your career journey, and where you want to be in the future,” she explained.

One thing that this writing exercise brings to the forefront is self-awareness which, Asai said, is such an important part of the leadership journey. Noting that her rise to company president was a zigzag, not linear, she outlined her career progression and the skills she learned along the way—a particularly valuable way of looking at professional development and staying the course.

“It’s very important to be intentional about your journey, according to your life stage,” she explained, breaking down the phases of career progression by age:

• Twenties: challenge yourself
• Thirties: work–life balance and expertise
• Forties: leadership
• Fifties: investing in the next generation

When she moved to Japan at age three, to Australia at age nine, and then returned to Japan two years later—all due to her father’s work with a trading company—Asai learned three key skills that would help her become a leader:

• Survival
• Listening
• Adapting to change

Two more skills were added when she chose to study at a UK university, before going to work for Sony Europe in Germany—despite speaking no German:

• Being the minority
• Communication

When she began a series of transitions in her thirties—shifting first to government affairs with Microsoft Corporation, then to healthcare with GE Healthcare, during which time she also served as director of the American Medical Devices and Diagnostics Manufacturers’ Association, later expanding her role to energy and finally becoming president of GE Japan in her late forties—she added two more key traits:

• Self-confidence
• Resilience

Now that she is president, she has taken on roles that help her invest in the next generation. This includes serving as chair of the ACCJ. And, while she leverages her experience to help others grow, she finds herself also refining skills such as:

• Developing people
• Building teams
• Crisis management

“I have lived in many places, in five countries, and have always been a minority in those societies—so I know how it feels when your voice is not heard, how painful it is to be left out with no means to respond,” she said. “Although I didn’t know the word ‘inclusive’ when I was very young, I came to understand what inclusive leadership looks like through my experiences in the early part of life. I’m sure many of you have had similar experiences. It’s very good to reflect on those and think about how you can apply what you learned earlier in life to your workplace today.”

As she noted, her path has zigzagged, so it is important to remember that you can learn at any time. “Leadership is all about acquiring skills at any point in your life. If you didn’t have a particular experience—for example, a chance to live abroad—earlier in your life, you can always do something different in your current life and practice adapting to the change.”

Pandemic Leadership

Next, Asai talked about the current situation and the need for leaders and teams to work together when dealing with a crisis such as the coronavirus pandemic.

“This is a moment when leadership really matters,” she said. “We need to prepare for the worst-case scenario and make sure that people understand the guidelines we have put in place. This takes self-awareness and imagination.”

She said that, in such situations, it is important to follow up with employees who may be feeling left out, or who find it difficult to talk with a manager. “We need to be creative about supporting them in making the work-from-home experience comfortable.”

At the start of the pandemic, Asai set up the national crisis management team for GE Japan, to help it cope with Covid-19 and the potential disruptions to business operations. By working together, helping everyone understand the risks and importance of establishing and following safety guidelines, and listening to employee concerns so that they might feel comfortable and adapt, GE Japan was able to continue being productive and secure.

Once everyone had become accustomed to the new procedures and workstyle, she handed over related responsibilities to the business leaders, who then managed their units and teams on their own.

Strategy and Policy

Expanding on GE’s business transformation, Asai highlighted the importance of focus.

“GE has a 128-year history, but we have really changed our portfolio over the past couple of years,” she explained. “We used to have businesses such as capital, plastics, and even media. But we have divested ourselves of most of the non-core businesses and now are focusing on infrastructure.” The three areas of the strategy are:

• Energy transition
• Precision health
• Future of flight

In terms of policy, GE is working with governments around the world to implement rules and regulations that harness innovation while ensuring a sustainable future. Three key policy areas are:

• Decarbonization
• Decoupling
• Digital transformation

Highlighting the last of these, she reminded attendees that “the ACCJ just released the Japan Digital Agenda 2030 report, which provides comprehensive guidance as to how Japan should leap from here, given that the government is focusing on establishing a digital ministry and there are a lot of changes to come. It’s an important time for the ACCJ to be putting forth a position on this, and we are also doing so at GE.”

Building a Culture of Success

“To make this business transformation, one of the most important jobs as a leader is to drive the cultural change,” Asai said, explaining that, at GE, 50 percent of a team member’s review score is based on performance and 50 percent on leadership behaviors, of which the company has three:

• Act with humility
• Lead with transparency
• Deliver with focus

“When we talk about acting with humility, it sounds obvious. But it’s also surprising that we are talking about it at this point in GE’s long history,” she said. “We are very proud of our technology, but because we are so proud, we have become a little bit arrogant. So, the questions are: How can we become more humble? How do we behave with humility? What does humility look like? We need to discuss and debate this as a team.”

She added that humility is a very important starting point for leadership behavior. “If you think something is wrong, you should say so. We have to be open to this. It has to be a culture of welcoming feedback and acknowledging mistakes.”

Transparency, she explained, goes hand in hand with humility, because without transparency, people will not raise issues and you cannot solve problems. The worst-case scenario for a company is not having the bad things reported up to management level.

“Trust is the base of this transparency,” she said. “And this also goes for leaders sharing bad news with the team in a timely fashion, because, without leaders exercising transparency, the team will not have the courage to share bad news themselves. It goes both ways.”

Delivering with focus relates to our ability to manage the demands of modern life, where it is easy to become distracted or be drawn into doing a task that is not the highest priority.

“In a world where we have so much work to do, we really need focus and speed. And being able to focus on the most important thing is a continuous challenge,” she said. “It is about ruthless prioritization and practice, and I am continually struggling to do that myself. Priorities are so important.”

Takeaways

In closing, Asai recapped five points that she believes can lead to a successful and rewarding career—one in which you might also zigzag your way to the top:

• Leadership is about continuous learning
• Focus on building trust
• Embrace awareness and imagination
• Be mindful of how you use time
• Take control of your life and have fun!

“We live in an uncertain world, so constant change is the norm,” she said. “We are never going to be perfect, so we need to be humble and learn from others. The good news is that you don’t have to be perfect, and you don’t have to know everything, because there’s no way to know everything.”

Building trust, Asai noted, takes time. But “speed of trust,” as she calls it, is very important because when there is trust you can get work done faster.

Being mindful of how you use time also is critical, she said. “In my case, I need to spend about 20 percent of my time reflecting and really thinking deeply, without meetings, and 10 percent or more on people development, talking to people—especially young talent who have points of view to share—and spending time with them outside my work.

“And, obviously, sleep and exercise—all the things that keep you healthy—must be tended to, so it’s very important to carve out time in your schedule for that,” she added in closing. “Making sure you are healthy is, in the end, bringing a healthy spirit to work every day.”

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