Gender equality is central to the New Form of Capitalism that Japanese Prime Minister Fumio Kishida is advancing forcefully. Kishida reaffirmed his commitment to that cause in a September 21 address to the HeForShe summit in New York during the high-level week of the UN General Assembly. UN Women launched the HeForShe movement in 2014 to promote male participation in promoting gender equality. It has selected Kishida as one of the HeForShe champions for the term from 2022 to 2025. The Japanese government will underline the commitment voiced by Kishida in hosting the 2022 edition of WAW! this December. Here, two leading experts on gender-equality issues offer background for the upcoming conference.
Japan's government set out in 2003 to raise the percentage of women in management and supervisory positions to 30% by 2020. Lagging performance, however, has obliged the government to lower its target and aim for “achieving around 30% as soon as possible in the 2020s.”
“The initial momentum for transformation has ebbed,” lamented EY Parthenon's Nobuko Kobayashi last month in Nikkei Asia. “Women now hold about 13% of managerial positions in Japan,” Kobayashi offered further commentary in response to questions for this prologue to WAW! 2022.
“The government put forward a numerical target, but it didn't accompany that target with a compelling reason. Its target therefore struck managements as arbitrary, and tentative steps forward soon succumbed to traditional bias.
“Deep-rooted notions about the 'natural' division of labor between genders are the fundamental problem. In the home, those notions relegate women to housework and childcare and dispatch men to work outside. And they carry over to the workplace, where they dispatch men to work like, for example, sales activity, and relegate women to support roles. Competent women don't get the chance to exercise their capabilities, and they face daunting obstacles on the path to supervisory and managerial positions.”
Most Japanese companies have learned to
avoid overt gender discrepancies in
compensation for the same job descriptions.
The problem is indirect discrepancies.
- Asako Osaki
Director, Gender Action Platform
Asako Osaki, a director at the Gender Action Platform think tank, echoes Kobayashi in explaining the gender gap in compensation. “A new legal measure in Japan will oblige large companies to disclose female-male wage differentials, starting next year. But most Japanese companies have learned to avoid overt gender discrepancies in compensation for the same job descriptions. The problem is indirect discrepancies. Companies tend to assign women to job classifications of lower compensation.”
Japanese companies' gender gap is especially glaring on women's path to the boardroom. Women accounted for just 9.0% of the board members at listed Japanese companies as of March 31, 2022, according to Tokyo Shoko Research, and for just 8.1% of the executive (up-through-the-ranks) directors. Nearly 40% of Japan's listed companies had no women on their boards, the research firm reported.
Osaki notes a parallel between the gender gap in compensation and in advancement. “The same discrimination in job assignments that depresses female compensation also narrows opportunities for advancement to senior management. So when you ask why we don't see more female executive directors, the answer is the dearth of female candidates in the pipeline. A burden of unpaid care work on women, of course, is an underlying factor.”
“As Japan's labor force continues to shrink, relying entirely on men to run companies is unwise,” warns Kobayashi. “Companies need to set ambitious but realistic targets for raising the female percentage of directors and ensure management's commitment to achieving those targets by incorporating them in the companies' key performance indicators.”
Growing pressure for reform
“Big investors are, more than ever, seeking transparency and diversity in corporate management,” reports Kobayashi. “That means looking carefully at performance in regard to the G (governance) of ESG, as well as to the E (environmental stewardship) and S (social contribution). Overseas investors, especially, take a dim view of Japan's male-dominated corporate culture. I think we can expect pressure from them, along with budding initiative at Japanese companies, to lead to greater gender equality in Japanese workplaces and boardrooms.”
Osaki suggests that the pressure for reform will gain momentum from the growing concern with human rights throughout supply chains. “The G7 Trade Ministers, meeting last year in the United Kingdom, committed to strengthening national policies in this regard. In response, Japan's government has moved rapidly to develop guidelines for corporate human rights due diligence.
“We need to realize that human rights are not just an issue for listed Japanese corporations that conduct purchasing globally and experience scrutiny from institutional investors. They're also an issue for Japanese companies, large and small, that supply components and materials to corporations based in Europe and North America. Laws in those jurisdictions require companies to monitor human rights ever more rigorously at their suppliers, and that can include such matters as wage differentials and sexual harassment at small manufacturers in the Japanese countryside.”
Diversity in empowerment
“Female empowerment,” observes Kobayashi, “is multifaceted, and it embraces the understanding that not all women want to become corporate executives. Women's minority status in career positions has engendered a freedom to devise a diversity of approaches to work. Gender equality means building on that diversity rather than simply adapting subserviently to male approaches. I hope that the upcoming WAW! conference will highlight diversity in every sense of the word.”
I hope that the upcoming WAW! conference will highlight diversity in every sense of the word.
- Nobuko Kobayashi
EY Asia-Pacific Strategy Execution
Leader, EY Parthenon
Osaki cites a troubling aspect of the growing diversity in women's vantage on their prospects. She notes a divergence revealed by Japanese Cabinet Office surveys between young unmarried women's goals and expectations.
“In the 1980s, the foremost life-course model for young unmarried women was either to become a lifetime housewife or to get married, bear children, and reenter the workforce when their children reached school age. These days, the top choice is to get married and continue working while bearing children. But the latest survey has revealed a worrying divergence over the past three years between young women's desires and expectations. A growing number express a desire to marry and continue working while bearing children but acknowledge the expectation that they will end up continuing to work without marrying” (source: “Josei katsuyaku ni kansuru saishin no deta” [Latest data on the growing female role in society], October 4, 2022, Gender Equality Bureau, Cabinet Office).
Osaki also voices great expectations of WAW! 2022. “Incorporating gender in our perspective on economics is crucial to economic sustainability. Economists and policy makers have traditionally ignored gender and failed to take into account such factors as unpaid care work. But gender has moved to the center of economic discourse, as have ESG and human rights. I hope that the message that WAW! transmits to the world from Tokyo will highlight that positioning.”
The Japanese government initiated the World Assembly for Women (WAW!) in 2014 as a conference for advancing gender equality. It has sponsored five WAW! conferences in Tokyo and will host a sixth there on December 3. Attending the fifth WAW!, in 2019, were 82 speakers from 27 nations and three international organizations, including Nobel Peace Prize laureate Malala Yousafzai; the UN high commissioner for human rights, Michelle Bachelet; the vice president of Argentina, Gabriela Michetti; and female foreign ministers from Austria, Bulgaria, Croatia, Domenica, Guatemala, Honduras, and Panama. And the organizers have arrayed an equally high-powered cast for this year's WAW! conference.
EY Asia-Pacific Strategy Execution
Leader, EY Parthenon
Kobayashi specializes in the consumer sector. Her consulting topics include growth strategy, organizational strategy, and corporate development. Before joining EY in 2018, Kobayashi served Japanese and multinational clients at a strategy consulting firm for more than a decade.
Director, Gender Action Platform
Osaki works with government agencies, international organizations, and research institutions to address gender issues. She formerly served as a program manager in the UN Development Program's Bureau for Development Policy. Osaki focused there on promoting gender equality and women's empowerment in developing nations.