Bilateral Boardroom: Key Lessons and Takeaways

Companies face growing business risks unless they take measurable steps on climate change and ESG issues, including diversifying their boards. Top executives on both sides of the Pacific drove home that message during a virtual boardroom meeting hosted on Nov. 16 by the U.S.-Japan Council (USJC). A recording of the event, “Purpose-Driven Leadership in U.S.-Japan Relations,” is available here; the Bilateral Boardroom event is the second of the year and is part of the Council’s Signature Series to bring together key stakeholders in lieu of USJC’s in-person annual meeting.

BlackRock and Hitachi: Views from the Top

In separate interviews, Larry Fink, BlackRock Chairman and CEO, and Toshiaki Higashihara,  Representative Executive Officer, Executive Chairman & CEO and Director, Hitachi, Ltd., emphasized that the stakes for companies will only continue to rise as shareholders, customers, current and potential employees, and business partners increasingly demand action to tackle climate change and ESG matters. Mr. Fink and Mr. Higashihara shared their respective company’s efforts to pursue sustainability and address social change.

In his discussion with co-Founder and former BlackRock Vice Chairman Susan Wagner, Mr. Fink cited the multi-faceted investment and business risks associated with not taking action on climate change. “I would just urge you and your board of directors to be very focused on this – being focused on how your company is moving forward in this de-carbonized world,” he told the audience in the U.S. and Japan. “It’s more than just having a good product or more than just being in the right space. It’s about their corporate purpose, how they’re living it and how they’re moving forward in a de-carbonized way.”

Mr. Fink added that “companies need to live their purpose more than ever before” and reflect on the best ways to connect with customers and employees. He encouraged leaders to diversify their management ranks and boards, having found that diverse thinking “creates more innovation – it creates more creativity and it creates higher probabilities of long-term success.”

In conversation with Paul Yonamine, USJC Board Chair and Chairman and CEO of Central Pacific Financial Corp., Mr. Higashihara pointed to Hitachi’s long-standing mission to be a global leader in addressing social issues. “Courageous leadership is essential, especially managing a large organization,” he stressed, noting the importance of Hitachi’s strategic focus on carbon-neutral technology.

Mr. Higashihara expressed his view that “it’s critical for multinational companies to cooperate to co-create solutions” to issues like climate change and societal challenges including those related to the COVID-19 pandemic; he strongly supported allowing Hitachi employees to work from home during the global health crisis. “I believe each employee should always be aware of how they can contribute to society even while still working remotely,” he said.

Making an Impact

Further applying ESG strategies on the individual level was the subject of a Council leader discussion moderated by iQ360 CEO Lori Teranishi. She was joined by Robin Lewis, Representative Director, Social Innovation Japan, and co-founder of mymizu; Kathy Matsui, Chair of the USJC Board of Councilors (Japan) and General Partner, MPower Partners; and Rika Nakazawa, Group Vice President Industry X C-Innovation, NTT, Ltd. The panel explored the expectations of younger generations and the role employees across an organization can play to inspire others, and to implement and support needed changes.

“To effect such change, not just here, but in any society, you do need to bring on what I call ‘champions’ – people who are going to be advocates alongside you,” observed Ms. Matsui.

U.S.-Japan Collaboration on Climate

In keeping with the Council’s focus on climate issues, Melanie Nakagawa, Special Assistant to the President and Senior Director for Climate and Energy on the National Security Council provided a special update on the recently concluded COP26 conference in Glasgow. “We all know that we can’t meet our goals without working together with the private sector,” she explained. “We know we need trillions more from the private sector to truly turn the corner on climate action.” She also called on the private sector to “bring the innovation, technology needed – this is also a great example of where I see an opportunity for U.S. and Japanese businesses to collaborate.”

Seeking new ways to facilitate solutions, USJC President and CEO Suzanne Basalla announced during the Bilateral Boardroom that, with anchor funding from Amazon, the Council will launch a Climate and Sustainability Initiative. The two-year project will aim for meaningful action to address the climate crisis through the U.S.-Japan relationship. More details will be provided soon.

The entire Bilateral Boardroom can be viewed here. USJC’s final Signature Series event of 2021 will be the Next Generation Summit on Dec.10-11, which will feature younger voices within the USJC and TOMODACHI Initiative community. To learn more about this event or register, please follow this link.