The Journal The Authority on Global Business in Japan

Although a long-established tradition in places such as the United States and the European Union, the practice of lobbying does not garner the same level of recognition in Japan. While conducting activities to influence policy in one’s favor is common in many countries, the process differs in Japan. Here, it has largely been conducted through behind-the-scenes negotiations (chinjo) involving a limited number of stakeholders.

In recent years, however, because of changes the Japanese government has made to how politicians can interact with private businesses, it has become increasingly difficult for such closed and often murky decision making to take place. There was great public backlash, for example, when the watering down of policies came to light, and there is now increased demand for objectivity and transparency within the policymaking process.

In the past, businesses could make use of personal connections with government officials to effect policy changes in their favor. But the rise of media’s role in exposing dishonest conduct—and the public criticism that inevitably follows—has required policy decisions to be fair and beneficial to society.

Recent major scandals involving two schools, in which private connections with top government officials are suspected to have led to unfair privileges, have shed light on the considerable risks a business faces when engaging in private negotiations with the government. In one case, a vast discount in state-owned land was given. In another, the school received authorization to establish a veterinary department due to such political connections. When such scandals are exposed, there are devastating consequences for both the business and any government officials involved.

For businesses looking to introduce new products and services in Japan, it is often necessary to lobby for changes to existing regulations that may create obstacles. In some cases, the necessary regulations to ensure the safety of a product or service may not yet exist. Conducting marketing without first ensuring that the necessary regulations are in place garners negative attention from the media, public, and related business organizations.

To be accepted, policy proposals that allow for the smooth introduction of a product or service to the Japanese market must solve existing social issues and involve a decision-making process that is both transparent and objective. Lobbying for a policy change that clearly only profits a single company or organization will merely spark criticism and outrage from media and the public. What is required from businesses, then, is to be an advocate for the policy changes that not only benefit themselves, but more importantly, also benefit society.

In fact, Japanese policymakers are in want of such input from businesses and the general public so that the discussions surrounding policy changes can be conducted more openly, and with an increased focus on furthering public interest. To solve social issues effectively, businesses must now gain the support of outside specialists and academics while also sharing knowledge of the issue with media. A three-party collaboration is necessary.

In Japan, what is now required is not behind-the-scenes lobbying (chinjo), but a strategy called public affairs that can be distinguished by the following points:

  1. It must be a solution that has public interest and helps solve social issues.
  2. It maintains transparency by revealing the decision-making process from its beginning stages.
  3. It ensures third-party objectivity by partnering with academics in creating policy proposals.

The practice of public affairs is gaining traction in Japan, and has resulted in significant successes for a number of companies—especially those driving change in their respective markets. In Japan, the strategy is most effectively employed by the public affairs division of Vector Inc., Japan’s largest public relations company. Well-versed in all forms of Japanese media, and able to utilize media in its lobbying strategies, Vector also cultivates relationships with specialists and academics to create policy proposals that originate from academia.

Vector, Inc. Public Affairs Division
No. 1 Public relations company in Japan, boasting eight consecutive terms with a growth in profit of more than 25 percent