The following is the summary of a session that was part of the 2018 Annual Conference.
- Moderator: Jesper Koll, CEO, WisdomTree Japan
- Takeshi Niinami, CEO, Suntory Holdings Ltd.
- Sachin N. Shah, Chairman, President and CEO, MetLife Insurance K.K.; President, The American Chamber of Commerce in Japan
Mr. Koll began the business plenary dialogue by asking Mr. Niinami about the impact of Abenomics and Trumpnomics on his business. Mr. Niinami answered that Prime Minister Abe has improved the economic situation since he took office six years ago, but that healthcare is still lacking. Regarding Trump, Suntory has had to pay a tariff on importing bourbon and exporting it to Europe, and that has not been favorable.
Mr. Koll explained that since Abenomics began, the Japanese population has been saving money due to anxiety about the future, and that healthcare is a big reason. Mr. Koll asked Mr. Shah how he felt about Abenomics and Trumpnomics. Mr. Shah replied that both leaders are aiming to reinforce their economies. As Mr. Koll stated, Japanese people are saving more money because of retirement and the future of healthcare. In the U.S., from a business perspective, it has been pro-growth reform. Sustained growth will be fundamental to both Japan and the U.S. under the current leaders.
Mr. Koll directed the next question to Mr. Niinami, asking where Abenomics is successful. Mr. Niinami answered that Japan has more foreign, women, and elderly workers than before. However, Japanese society must start considering the low birth rate, low skill wages, the mobility of people who are willing to change jobs, health care, and skilled labor.
Mr. Koll asked what employees in Japan want. Mr. Shah responded that labor market reform is a key discussion topic, along with healthcare reform. If social welfare issues are not tackled, in the future, those issues could take funding away from and damage other sectors.
Mr. Koll asked about Japanese work culture, and if people can be empowered based on skills or if companies still have a system that prioritizes seniority. Mr. Niinami answered that individuals who are willing to work hard and do things well are sent to American or European entities. Many people are motivated to work overseas, and since companies do not want to lose that motivation, they create opportunities abroad.
Mr. Koll asked about pay for performance. Mr. Shah replied that it is working. With the pay for performance system, they are able to see who the real performers are, and make deliberate human resources moves considering employees’ skills. In a traditional Japanese human resources system, it is not clear how to move people around the company in order to get the most out of their skills. It also allows companies to see diversity and productivity.
Mr. Koll then asked how HR, empowerment, and pay for performance is dealt with. Mr. Niinami explained that he got rid of the seniority system. In addition, diversity is key, so he recruited many females and mid-career employees. He also noted that teamwork is important, and that finding a balance among all of these important factors is difficult.
Mr. Koll noted that there are a lot of opportunities in Japan, and asked if Mr. Niinami and Mr. Shah were young entrepreneurs, which area they would invest in. Mr. Shah replied that innovation and cross-industry areas provide entrepreneurial opportunities. Mr. Niinami responded that he would definitely invest in healthcare. He wants a bridge between the U.S. and Japan to exchange data and make use of disruptive technology to make viable solutions to healthcare, instead of relying on the government too much.
To end the dialogue, Mr. Koll asked what advice the panelists would give to Prime Minister Abe and President Trump. Mr. Niinami answered that, to President Trump, he would mention the value of diversity, and joining the TPP again. To Prime Minister Abe, he would mention mobility of labor because the government is considering raising the retirement age to 70. Mr. Shah answered that, to President Trump, he would suggest prioritizing a healthy bilateral relationship with Japan. To Prime Minister Abe, he would recommend focusing on actionable progress and prioritizing U.S.-Japan relations.
Click here to see the video of the session.