ACCJ Journal October 2009 by Paradigm

¥800 | October 2009

Journal

ACCJ Charity Ball ■ Golf Subcommittee ■ ACCJ Event Reports ■ Fukuoka Business Profile ■

AEROSPACE AND DEFENSE ACCJ Committee Special Report SPECIAL SECTIONS

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ACCJ Mission Further the development of commerce between the United States of America and Japan, promote the interests of U.S. companies and members, and improve the international business environment in Japan.

CONTENTS

Volume 46 | Issue 10 | October 2009

FEATURES COVER STORY 12

Aerospace and Defense Special report on the ACCJ Committee involved in space law, defense procurement reform, security and related issues. By Julian Ryall 航空宇宙および防衛宇宙法、防衛物資調達改革、安全保障およびその関連諸問題に関与するACCJ委員会の特別報告。文／ジュリアン・ライアル

ACCJ Event HR Best Practices for Approaching Restructuring with Transparency, Integrity, and a Human Touch. By Geoff Botting ACCJイベント透明性、完全性、人間味を伴う再編のための人事(HR)面での最優良事例。文／ジョフ・ボッティング

TBLI Conference Report ACCJ CSR Committee Chair Patricia Bader-Johnston helps moderate the world’s largest annual international education and networking event on environmental, social and governance investment. By Alana Bonzi TBLI会議報告環境、社会およびガバナンス投資に関する世界最大の年次国際教育・ネットワーキングイベントの司会をパトリシア・ベーダ-ジョンストンACCJ CSR委員長がサポート。文／アラナ・ボンジ

ACCJ 2009 Charity Ball By Shaun Dubin and Jeffrey Shimamoto ACCJ2009年度チャリティー舞踏会文／ショーン・デュビンとジェフリー・シマモト

October 2009 | The Journal | 1

CONTENTS

Volume 46 | Issue 10 | October 2009

50 DEPARTMENTS 9

Note from the Editor

Vice Presidentâ&#x20AC;&#x2122;s Message

Media Watch Value added service. What Recession. Girl survey. Freebie Jeebies. Seiyu sharpens sales.

ACCJ Golf Subcommittee Report By Julian Ryall

Jesper Koll Writes Outward Bound

Events Line-up Business and leisure-related happenings in October. By David Umeda

FDI Portfolio Digital dining. Chinese expansion. Suwa precision. Uniqlo+J. By Nicole Fall

Business Profile Miyuki Tokunaga is CEO, The Presents Co. Ltd. By Tony McNicol

Advocacy Update ACCJ Viewpoints

Behind the Book The Ramen King and I: How the Inventor of Instant Noodles Fixed My Love Life by Andy Raskin, is reviewed by Tom Baker.

In the Final Analysis By Samuel H. Kidder, ACCJ Executive Director

2 | The Journal | October 2009

TONY MCNICOL

Areas of Practice: Corporate/M&A

Finance

IP, IT and Entertainment

- General Corporate

- Capital Markets

Tax Practice

- Mergers and Acquisitions (M&A)

- Banking

Dispute Resolution

- Private Equity

- Securitization/Structured Finance/Trust

Real Estate and J-REITs

- Legislation/Regulations

- Financial Regulations/Fund Management

Antitrust Practice

- Restructuring/Insolvency

- Insurance

Environmental Law Practice

- Compliance/Risk Management

- Acquisition Finance

Employment and Labor Practice

- Project Finance

China Legal Practice

Year Established: Number of Lawyers: Languages Spoken: Contact Person:

2000 326 (as of September 1, 2009) Japanese, English, Chinese, French, German (Ms) Yuko Tamai (Dai-ichi Tokyo Bar Association)

Kioicho Building, 3-12, Kioicho, Chiyoda-ku Tokyo 102-0094, Japan Tel: 03-3288-7000 Fax: 03-5213-7800 Web: http://www.noandt.com/ Email: info@noandt.com

Presidents Emeriti Thomas F. Jordan (1994-1995) Robert F. Grondine (2000-2001) Debbie Howard (2004-2005) Charles D. Lake II (2006-2007) Allan D. Smith (2008) ACCJ Leaders President Thomas W. Whitson KPMG FAS Co., Ltd. Chairman Allan D. Smith AIG Companies, Japan and Korea Vice Presidents Michael J. Alfant Fusion Systems Japan Co., Ltd. Laurence W. Bates General Electric Japan, Ltd. William R. Bishop, Jr. Nippon Becton Dickinson Co., Ltd. Michael D. Bobrove (Kansai) Nihon Medrad K.K. Kumi Sato Cosmo Public Relations Corporation Mark F. Schwab United Airlines, Inc. Chris Zarodkiewicz (Chubu) Cezars International K.K. Treasurer Nasir Majid PricewaterhouseCoopers Brett Jensen (Kansai) Colliers Hallifax Steve Burson (Chubu) H&R Consultants ACCJ Governors Andrew Conrad Aflac International, Inc. Christopher K. Ellis Chrysler Japan Company, Ltd. Bruce J. Ellsworth Johnson & Johnson Family of Companies James Foster Microsoft Japan Harry Hill (Chubu) Oak Lawn Marketing, Inc. Tad Johnson Pratt & Whitney Aftermarket Japan KK John Kakinuki GE Consumer Finance Co., Ltd. Jiri Mestecky Kitahama Partners L.P.C. Kinji Yasu Stone Container Japan Co., Ltd. Douglas L. Peterson Nikko Citi Holdings Inc. Nicole W. Piasecki Boeing Japan Jay Ponazecki Morrison & Forester LLP Mitsuyo Teramura Federal Express Corporation Jim Weisser PBXL ACCJ Executive Staff Samuel H. Kidder Executive Director Aron Kremer Deputy Executive Director ACCJ Committees American Auto Industries Rick Brown Architecture, Construction & Real Estate Kevyn Johnson/Michael P. King Asia Business Philip C. Jones B2B Sales Karl Hahne/Craig Saphin Banking and Finance Thomas Clark/Ernfred Olsen Capital Markets Douglas Hymas Charity Ball Barbara Hancock Competition Policy Task Force Robert Grondine Corporate Social Responsibility Patricia Bader-Johnston Direct Marketing Joseph Peters Environmental Rebecca K. Green Financial Services Forum Charles D. Lake II Food and Agriculture Collin Benson Foreign Direct Investment Nicholas Benes Government Relations Ira Wolf Healthcare Steve Plunkett Human Resource Management Chris Lamatsch, Adam Kassab Independent Business Doug Jackson Information, Communications & Technology Darren McKellin, Ann Rollins Insurance Nate Graddy/Jonathan Malamud Intellectual Property David Case International Education Patrick Newell Internet Economy Task Force Yoshitaka Sugihara Investment Management David Monroe Leadership Forum Michael J. Alfant/Kumi Sato Legal Services Arshad Karim/Eric Sedlak Corporate Counsel Clair Chino Marketing Programs Koichi Hama Membership Relations Andrew Silberman Privatization Task Force David Hoover Retail Ed Kolodzieski Soft Landing Task Force Adam Kassab/Mariko Nakazono Special Events Barry Bergmann Young Professionals Group John Ghanotakis/Daniel Lintz Taxation Jack Bird/Michael Shikuma Toiletries, Cosmetics & Fragrances Yukiko Tsujimoto Transportation and Logistics Jeff Bernier/Jeremy Goldstrich Travel Industry Kayoko Inoue/Vincent You University Briefing Program Richard May/David Satterwhite Kansai Chapter Business Programs Pabel Delgado Community Service Kojiro Dan External Affairs Kiran Sethi Living in Kansai Barry Louie Membership Paul Dupuis Women in Business Mari Nogami Chubu Chapter Community Service Steve Burson External Affairs Trey Hoffman Independent Business Chris Oostyen/Jason Morgan Living in Chubu Lowell Sheppard Membership Relations Chris Zarodkiewicz Programs Steve Brown American Chamber of Commerce in Japan Masonic 39 MT Bldg. 10F, 2-4-5 Azabudai Minato-ku, Tokyo, Japan 106-0041 Tel: 03-3433-5381 Fax: 03-3433-8454 www.accj.or.jp / www.ecentral.jp The ACCJ is an independent membership organization with no affiliation with any government or other chamber of commerce. The ACCJ is a member of the Asia Pacific Council of American Chambers and values its relationships with Japanese, American and other nationsâ&#x20AC;&#x2122; business organizations.

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www.deloitte.com/jp Tohmatsu Tax Co. Shin-Tokyo Building 5F, 3-3-1, Marunouchi, Chiyoda-ku, Tokyo 100-8305 Japan Tel: +81 (0) 3 6213 3800 Fax: + 81 (0) 3 6213 3801 E-mail: tax.cs@tohmatsu.co.jp Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, and its network of member ﬁrms, each of which is a legally separate and independent entity. Please see www.deloitte.com/jp/en/about/ for a detailed description of the legal structure of Deloitte Touche Tohmatsu and its member ﬁrms. © 2009 Tohmatsu Tax Co Member of Deloitte Touche Tohmatsu

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Journal

Publisher Vickie Paradise Green paradise@paradigm.co.jp

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Editor-in-Chief Simon Farrell simonfarrell@paradigm.co.jp Senior Editor David Umeda

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Art Director Paddy O’Connor Graphic Designer Akiko Mineshima COLUMNISTS Tom Baker, Nicole Fall, Jesper Koll CONTRIBUTORS Alana R. Bonzi, Geoff Botting, Martin Foster, Justin McCurry, Tony McNicol, Anthony H. Rowley, Julian Ryall, Catherine Shaw PHOTOGRAPHERS / ILLUSTRATORS Tony McNicol, Jeremy Sutton-Hibbert, Darren Thompson, Mattias Westfalk Published by Paradigm

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President Vickie Paradise Green Creative Director Richard Grehan Advertising Sales Eileen Chang, Sarit Huys, Helene Jacquet, Leai Kubotsuka Kamiyama Ambassador 209 18-6 Kamiyama-cho, Shibuya-ku Tokyo, Japan 150-0047 Tel: 03-5478-7941 Fax: 03-5478-7942 e-mail: inquiries@paradigm.co.jp www.paradigm.co.jp

Published monthly in Tokyo, on the 25th of the month, since 1964. Indexed in the PAIS BULLETIN. All rights reserved. The views and opinions expressed herein (other than editorials from the ACCJ itself) are solely the opinions and views of their authors. The ACCJ is not responsible or liable for any portions thereof. Subscription rates for non-ACCJ members One year ¥9,000; two years ¥15,000; three years ¥22,000. ¥800 per copy. Rates include domestic postage or surface postage for overseas subscribers. Add ¥7,500 per year if overseas airmail is preferred. Please allow eight weeks for changes of address to take effect. Subscription requests should be sent to info@accj.or.jp The ACCJ Journal welcomes story ideas from readers and proposals from writers. Letters to the editor may be edited for length and style.

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NOTE FROM THE EDITOR

So, Farewell Then

his is my last issue of the Journal. Itâ&#x20AC;&#x2122;s been a memorable trip. Mostly great, with minor regrets. When I started as editor in chief in March 2006, the economy was recovering. I had a vision and great writers. The ďŹ rst few weeks were bewildering. But ACCJ staff and members offered generous help and friendship. I was told, â&#x20AC;&#x153;Youâ&#x20AC;&#x2122;ll never please everyone. But please try to.â&#x20AC;? My sincere gratitude to the ACCJ management, staff and members that encouraged, supported, cajoled and occasionally berated me. In particular, Sam Kidder, Bill Bishop, Peter Rolufs and Ryan Armstrong kept me focused on the key issuesâ&#x20AC;&#x201D; advocacy, events, information. Iâ&#x20AC;&#x2122;ve been through three presidents and two executive directors. All had their own unique style of achieving ambitious goalsâ&#x20AC;&#x201D;and writing their

columns. I quickly learned to excuse busy leaders from the golden rules of journalism: â&#x20AC;&#x153;Never miss a deadline and never exceed a word count.â&#x20AC;? Special thanks also, of course, to my loyal and gifted journalists, never shy with ideas, praise, criticism and opinions. And also to my proofreader, who caught some great bloopers just in time. Not to forget my talented design and sales teams that endured many late editorial changes with a good-natured can-do spirit. Best-forgotten moments include that early travel piece on a disputed island that earned me a foreign ministry rebuke. Highs include interviewing the annual ACCJ Person of the Year and meeting other worthy VIPs at ACCJ events. The experience and knowledge I have gained from the ACCJ has greatly inspired and bettered me. At the monthly Leadership Forums, I

sat in awe, not just at the abundant breakfast buffet, but at the slick and informative way leaders tabled full agendas. Indeed, the Forum was a rare chance for feedbackâ&#x20AC;&#x201D;from committee leaders, the voice of the membership. In an organization with 3,000 or so members of such diversity, perhaps the most frequent comment was: â&#x20AC;&#x153;Well, I donâ&#x20AC;&#x2122;t always read all of the Journal, but I always ďŹ nd something interesting in it these days.â&#x20AC;? The challenges facing publishing today require great commitment, vision and nerve. Technology and competition have made it faster and more furious. But I am conďŹ dent the Journal will continue to support the ACCJ Mission Simon Farrell and enlighten readers. simonfarrell@ Thank you, all, and paradigm.co.jp the best of luck. â&#x2013;

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VICE PRESIDENT’S MESSAGE

Trading Places

Two-thirds majority 320

240

DPJ/SDP/ People’s/Nippon

▲

ith a nearly 70% voter turnout, the result of the August 30th Lower House election was nothing less than a historic landslide victory for the Democratic Party of Japan (DPJ) and a clear mandate for change. The tapestry of every story is woven with multiple threads; the story of the recent election is no different. One storyline that dominated the media following the election focused on the defeat of the establishment Liberal Democratic Party (LDP) to an upstart DPJ. A deeper look reveals a different story. As it happens, Yukio Hatoyama, the seemingly upstart DPJ leader that brought down the all powerful LDP, is in fact the grandson of Jiro Hatoyama, who in 1954 after defeating Taro Aso’s grandfather, Shigeru Yoshida, Prime Minister from 1948 to 1953 during the U.S. Occupation, founded the LDP by merging his Japan Democratic Party with its vanquished conservative rival, Yoshida’s Liberal Party, in 1955. Beyond the stunning reversal of fortunes in the number of seats each party held before and after the recent Lower House election, the personal stories of the main characters were truly a tale of trading places, wherein the grandsons of two political dynasties fought on the sides opposite their grandfathers’—and yet, in part, battled over a similar cause with a similar outcome. In 1955, the founding of the LDP was, in many ways, an act of survival in response to the rising popularity of the Socialist; it was also, in part, an expression of post-war Japan’s desire for more leeway in diplomatic affairs. In a way, the rise of the DPJ could be viewed as a continuation of this desire in light of new global realities. Despite all the rhetoric about the evils of American-led “market fundamentalism,” in his oft quoted August 19th speech, Hatoyama reaffirmed the importance of the Japan-U.S. relationship. “Unquestionably, the Japan-U.S. security pact is the cornerstone of Japanese diplomatic policy and an important pillar of our diplomacy.” It is important to understand that Hatoyama also envisions a new world order where, “… the era of American unilateralism … [and] … U.S.-led globalism is coming to an end … [and where the world is] … moving away from a unipolar world toward an era of multipolarity.” The recent international reaction and dramatic shift in emphasis away from the old G-7 to the new G-20 following the global financial crisis tends to support an emerging multipolar worldview. These and other factors point to a possible shift in Japanese policy toward the U.S. that is more one of emphasis than direction. Indeed, in Hatoyama’s multipolar world, China looms large. “The size of China’s economy will surpass that of Japan in the not-too-distant future. How should Japan maintain its political and economic independence and protect its national interest when caught between the United States, which is fighting to retain its position as the world’s dominant power, and China, which is seeking ways to become dominant?” His answer,

Lower House’s New Balance of Power

Other

319

DPJ LDP

331

126

Before Election LDP/Komeito

DPJ

140

308

LDP 119

Komeito 21

Nippon 1

People’s 3

SDP 7

DPJ 308

(-181)

(-10)

(+1)

(-1)

(±0)

(+193)

Independent

JCP

Renaissance

Your Party

(±0)

(-1)

(+1)

(±0)

Other

Figures in parentheses show change from before election

“The United States and China are two superpowers, but the role Japan can play in facilitating relations between them is by no means a small one.” Interestingly, the U.S. views Japan less as a mediator than as a partner. In this emerging trilateral dynamic the roles of partner, competitor, counterweight and mediator will be interchanged with regularity between China, Japan and the U.S. There is little doubt that this evolving trilateral arrangement already accounting for over 50% of global GDP will become increasingly central within the geopolitical and economic dynamic of the Asia-Paciﬁc and has within it the potential of setting the course for global trade harmonization and economic expansion throughout the 21st century. In a multipolar world, learning to work with others to ﬁnd consensus will become increasingly important. The sprouting latticework of bilateral and multilateral relationships regionally and globally only adds to the complexity. In this brave new world, reliable friends are indispensable, making the longstanding U.S.-Japan bilateral relationship a stable and sturdy cornerstone for both nations. Though there has been a trading of places in Japanese political leadership, the work of building a more open, transparent and harmonious market environment for trade in goods and services, and mutual investment will continue. The upcoming annual ACCJ Diet Doorknock this autumn presents us with William Bishop, an opportunity to strengthen old relationships an ACCJ Vice and build new ones. Understanding the new President, government’s policy goals and how the ACCJ can is Director, continue to effectively act as an honest broker Government & Public Affairs at to provide meaningful input will be important. Nippon Becton In preparation, I would like to encourage ACCJ Dickinson Committee Chairs to review key issues and ensure Company, Ltd. key ACCJ Viewpoints are fully up-to-date. ■

October 2009 | The Journal | 11

Aerospace and Defense ACCJ COMMITTEE SPECIAL REPORT By Julian Ryall

ext year marks the 50th anniversary of the U.S.Japan Security Alliance, a landmark that the ACCJ Aerospace and Defense Committee hopes to utilize to further develop the special relationship that has been built up in the industry over the last half-century. It is, the committee believes, a relationship that is unique in the world for its interdependence and competitiveness. And while there have been some stories in the media that have raised uncertainty over the future course of relations in the areas of defense and foreign policy under the incoming Democratic Party of Japan administration, the feeling among some of the biggest players is that

12 | The Journal | October 2009

the relationship remains very solid and, in fact, presents opportunities for an even deeper partnership between the two countries for the 50 years to come. “We will need to wait and see who the new defense minister is and the makeup of the rest of the Cabinet, but I personally take the DPJ leadership’s recent statements to mean that, at the end of the day, the U.S.-Japan relaTerry Nakatsuka tionship remains fundamental,” said Terry Nakatsuka, general manager for Japan at GE Aviation and co-chair of the Aerospace and Defense Committee, shortly before Yukio

Hatoyama named the key members of his Cabinet. “Japan is a critical market for U.S. aerospace and defense companies and a key source of innovation and partnership—a fact that is not going Jean Pierre Bolat to change anytime soon,” said Jean Pierre Bolat, co-chair of the committee and director for aerospace and defense markets for Nippon Donaldson, Ltd. “Our member companies remain committed to supporting the needs of our customers in Japan, and will adapt to address the evolving requirements of the new government.”

AEROSPACE AND DEFENSE

Japan’s security environment remains unchanged, with Northeast Asia continuing to be one of the most complicated—and some would say dangerous—regions in the world. This uncertainty causes many to believe that Japan’s need for defense capabilities will only increase in the future, making the U.S.-Japan Security Alliance—and the role the committee and its member companies play in supporting it—all the more important. Japan’s political landscape has changed, however; dramatically in fact, meaning the committee’s members will be challenged to make new contacts with the incoming administration and reiterate the main points of an advocacy program that has been championed with the previous administration. And, as the committee works with the new government to ensure it understands

the aerospace and defense industry’s concerns for the next few decades, the committee is also committed to continuing to support the new administration’s efforts to address the complexities of the industry and the importance it represents relative to the national security of Japan. Another change, although a more gradual one, is the public’s increased awareness of the issues surrounding Japan’s national defense, and its willingness to engage in these topics. This makes the committee’s work even more timely, members believe. The 35 members of the closed committee—so defined because of the sensitivity of many of the topics that it discusses—are drawn from all the major U.S. aerospace and defense firms with interests in the Japanese market, including Boeing, Raytheon, Lockheed-Martin, Honeywell, GE, United Technologies and Northrop-Grumman. Additional members include suppliers, software producers and industry consultants. Collectively, the companies represent a significant portion of the commercial trade relationship between the U.S. and Japan, and play a key role in supporting the U.S.-Japan Security Alliance. All members agree that Japan is critical to the global competitiveness of U.S. aerospace and defense companies, as it is the third-largest commercial aerospace market in the world and one of the top defense markets; Tokyo’s procurement of defense platforms and systems generates significant annual revenue for U.S. and Japanese firms alike. This, in turn, reduces research and development costs on a per-unit basis, and has the added benefit of extending production lines in the U.S. Japan has proved to be a major partner to U.S. defense firms in the past, having adopted more platforms than any other U.S. ally. These range from fighter jets to helicopters and satellites to critical

systems used in missile defense. Furthermore, in the commercial arena, U.S. and Japanese companies have built up a true interdependency over the years and, in so doing, have created a partnership that is unmatched in the world for its competitiveness. Together, U.S. ﬁrms and their Japanese industrial and airline partners have launched products that lead the world in terms of their technology, reliability and environmental performance. Innovation is the hallmark of this unique relationship and allows for the design and manufacturing of products sold not just in Japan and the U.S., but all around the world. The way to ensure this partnership continues is to constantly build new bridges with the Japanese administration and companies operating in Japan, the committee believes. Members were very active in this year’s Diet Doorknock, meeting politicians from across the political spectrum with an interest in aerospace and defense issues, and aim to do the same when the next opportunity arises in November. There has also been a successful program for visitors to address the committee, with speakers including Keith Webster, deputy assistant secretary for defense exports and communication in Washington, D.C., Dr. Jaiwon Shin, associate administrator for the Aeronautics Research Mission Directorate at NASA, and Seiji Higuchi, executive director of the Lunar and Planetary Exploration Group with the Japan Aerospace Exploration Agency (JAXA). “We share lots of information, we arrange visits and forums with key leaders from both countries to discuss what is happening in Japan, and if government leaders want an industrywide view on topics of mutual interest, we are here to support them and exchange ideas,” Bolat said. The committee made a public comment in mid-May in response to

October 2009 | The Journal | 13

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Pratt & Whitney is proud of our long-time strategic partnership with the Japanese aviation industry today, tomorrow and beyond. Please visit us at www.pw.utc.com.

AEROSPACE AND DEFENSE

SNAPSHOT ■

■ ■

■

Aerospace and Defense evolved into full committee in 2009 Closed to U.S. companies only Represents $6 billion-plus in annual Japan revenue Goals: Advocacy, Information Sharing, Networking

the release of the Japanese government’s Basic Space Plan, issued by the Strategic Headquarters for Space Policy. The committee underlined the long history of collaboration between U.S. companies and Japan in the area of space—such as on the International Space Station, the Galaxy Express launch vehicle and the Quasi-Zenith Satellite System—and called for a continued partnership that would help reduce the amount of time and funds required for Japan to meet its national security objectives. “The high cost of research and development needed to make significant progress in the advanced areas of space technology, combined with today’s difficult global financial environment and resulting budget pressures, only add to the necessity and desirability of pursuing international cooperation,” it stated. “Indeed, leveraging the specialized expertise in the U.S. and Japan would encourage the competitiveness of both countries’ aerospace industries while mitigating overcapacity in each.” “Space represents an area for U.S. and Japanese companies to work closer together for the benefit of industries and governments on both sides,” said Thom Breckenridge, director of Operations and Strategy for Boeing Thom Breckenridge International Corp. in Japan and vice-chair of the Committee. “Our experience on the commercial side of the business leads us to believe that increased collaboration with Japan in growing areas like space could improve our competitiveness around the globe, thanks to the advanced technology and quality manufacturing of our Japanese partners.”

“New policies in the area of export control could spur that competitiveness, by allowing for increased collaboration between industries and governments on both sides. Current policies limit the ability of U.S. and Japanese firms to work collectively; this increases costs and the risks associated with developing new products and systems, which are highly complex. At a time when defense budgets are under pressure due to the world’s economic woes, the committee believes addressing this issue is more important than ever and is hopeful the new government will actively take it on. An additional opportunity presented by the recent governmental change lies in procurement practices. Describing the government’s procurement methods, Bolat said the previous administration had taken the position that it wanted to reform the way in which defense contracts were arranged and that the committee remains committed to supporting the new government as it works to increase the efficiency and transparency of the procurement process. “A study group has been set up within the Ministry of Defense to examine the issue of direct procurement and taking it out of the hands of trading houses, which is traditionally the way it has been done here,” said Nakatsuka. “As a committee, we’re more than happy to do everything that we can to help, but progress on this reform has been slow. “They started their research in early 2008 and the conclusion they will reach is that they are not able to increase direct purchases because they would need a lot more personnel in their procurement office,” he said. “With the new government’s focus on administrative transparency, perhaps there will be an opportunity for further progress.” A third area of concern is interoperability between the systems that are being adopted by the two allies, a problem compounded by Japanese companies’ preference for setting their own standards and technology, then requiring an interface when used by both sides.

SNAPSHOT Advocacy Agenda: ■ Space Law ■ Defense Procurement Reform ■ Interoperability ■ Security ■ Nat’l Defense Program Guidelines (NDPG) ■ Environmental Standards (CO emissions) 2

“This is a key issue for supporting the U.S.-Japan Alliance,” said Bolat. “If we cannot exchange data between our different systems, then the effectiveness of the overall alliance is reduced. We believe our defense systems should be interoperable, even if Japanese and U.S. firms are developing systems separately.” The final portion of Japanese policy that the committee is keeping a close watch on is the National Defense Program Guidelines (NDPG), which detail the nation’s defense priorities and plans. Before the general election in August, the committee exchanged ideas and perspectives with members from the Liberal Democratic Party on defense and aerospace issues. And now, post-election, the committee is working to forge new relationships with the leaders who have taken over the reins. The DPJ’s comments about its intention to increase the role of politicians in the bureaucratic process will only make this more important. “The landscape has changed completely,” said Bolat. “We really need to sit down with the new administration leaders, find out their concerns, and then ask them how we can be of help.” The key to sustaining the competitive edge lies in preserving and advancing the relationship, and capitalizing on the collective strengths on both sides of the Pacific to meet the challenges of the future. The committee believes it will naturally be extremely important for both governments and businesses in the U.S. and Japan to remain mindful of the unique features of the relationship, strategic partJulian Ryall is The Daily nership and friendship— Telegraph’s Tokyo features that keep both sides correspondent. competitive and strong. ■

October 2009 | The Journal | 15

MEDIA WATCH

What Recession? The declining demand for goods and services notwithstanding, travel agencies have been making greater marketing efforts to appeal to the affluent segment of society. In the thrice-weekly Nikkei Marketing Journal (July 31), JTB reports that its upscale Royal Road Ginza travel salon, offering made-to-order travel packages, has achieved sharp growth since the second half of 2008. Its main customers are doctors, whose incomes have not been affected to the same degree as other professions in the dramatically slowing economy. Manager Akira Tazawa says that some of his customers even take trips in private jets, at prices in the range of ¥60 million. To appeal to customers in regional cities, JTB opened branches of its Royal Road Ginza in Sendai last January, and Sapporo and Osaka in April. The company opened a second Tokyo branch in Yurakucho, Chiyoda Ward, in May to meet increased demand. Kinki Nippon Tourist and Hankyu Travel also have developed tour products appealing to the upper crust. Nippon Travel Agency

began sales of its Chikyu no Okurimono overseas package tours from the start of the new fiscal year in April and reported bookings of ¥70 million by June. Spa! (Aug. 4) also jumps in with an eight-page article asking, “What’s so bad about profligate spending?” Sophia University Economics Professor Hideomi Tanaka says that spending by those who can afford it should be welcome. Tanaka cites how consumption accounts for 60% of Japan’s economy, around ¥300 trillion per year, of which around ¥120 trillion goes toward outlays beyond basic necessities. If, for example, Japan were to become like North Korea and people were to spend only to maintain subsistence, unemployment would soar to at least 10%, according to Tanaka, and the GDP shrink by a commensurate amount, making the current recession seem like a picnic. “Accusing people of mudazukai [profligate spending] is just jealousy on the part of the ones who can’t do it,” he says. “It’s important to have a society in which everyone spends. Circulation creates a multiplier effect that is returned to the consumer.”

June 2009 | The Journal | 17

Freebie Jeebies Recruit’s R25, a free weekly magazine launched in July 2004, is now struggling to survive, reports Weekly Playboy (Sep. 7). The article quotes a source at Recruit as saying the print run declined from 600,000 copies at its peak to about 500,000 at present. From June, the number of distribution points had been reduced by 1,000—to 1,950. In July, the publisher shut its R25 mobile site for cellphone users due to deficits. L25, a sister publication aimed at women, will probably go from a weekly to a monthly from October. Free magazines, which depend on advertising for their existence, have been hard hit by the recession. At its R25 launch,

Recruit had been successful in selling a packaged arrangement, which included posting on commuter trains, for ¥30 million. But, in fiscal 2008, R25 reportedly posted a deficit of ¥930 million, according to an ad agency source. “We can’t help but feel that the boom is over for good,” a spokesperson for the Japan Free Newspapers Association (JAFNA), comprised of 38 companies that publish free newspapers, is quoted as saying. Compared with 200 new publications launched in 2007, the new tally fell last year to half that figure.

Girl Survey If you want to know how the economy’s doing, why not ask a teenage girl? Weekly magazine Aera (Aug. 17) tied up with the GAL’s POP Web site operated by Popteen, a magazine with a circulation of 400,000, to survey young women on how the recession was impacting their families and lifestyles. The survey of 1,685 JKs—an acronym for joshi kosei (female high school student)—offered a rare peek into what’s going on in Japanese households from the perspective of teenage girls, who are major consumers in their own right. The results more or less confirmed what the pundits have been saying all along: 81.8% of the respondents feel the recession’s impact. In descending order, indications included that the father comes home earlier, 21.5%; allowance has been cut, 11.8%; fewer job recruiters are at their schools, 9.7%; are regularly reminded by their mothers, 8.1%; are taken out to eat less frequently, 7.0%; prices for goods have increased, 6.4%; parents’ salaries have declined, 6.2%; less recruitment for part-time work, 5.4%; and tendency to buy things only when discounted, 5.4%. “My allowance is down, and it’s hard to find part-time work—it’s as bad as it gets,” one teen despaired over her

18 | The Journal | October 2009

current circumstances. “The size of the donuts at Mister Donut got smaller, Potato Snax got shorter, and candy became more expensive. I’m broke.” On average, girls spent just over ¥40,000 a month, the greatest outlays going toward clothing and accessories, cellphones and savings. The top three items in greatest demand were apparel, 32.1%; designer-brand wallets, 14.5%; and cosmetics, 10.1%.

MEDIA WATCH

Seiyu Sharpens Sales Nikkei Business (July 27) devotes an 18-page report to Wal-Mart’s worldwide operations. Although the American giant does not operate any stores under its own name in Japan, the company acquired control of the Seiyu retail chain in 2002. By appealing to consumers’ desire for thrift through its policy of EDLP (every day low price), Seiyu has managed to weather the recession better than rival chains. But realizing that it cannot merely compete with low prices, Seiyu has sought in-house suggestions to boost productivity. From the beginning of 2009, outlets adopted a more dynamic system in which staff on the sales floor were no longer assigned to a single section, but could be shifted to any department, or to cash registers, during busy periods. This flexibility also encompassed part-timers. The new system claims to have raised efficiency, boosting sales per worker by over 15%. The new policy will have been adopted in 170 of the chain’s stores by the end of this year and applied to all 371 outlets by 2010.

Value Added Service “Two or three times a week, I give massages,” says the waitress, a woman in her twenties. “I get bad stiff shoulders myself, so it’s good for customers to be able to loosen up while they eat.” Talk about rubbing customers the right way: at Tsukiji Sushi Sen’s main branch, you can also get a shoulder massage. Nikkan Gendai (Aug. 11) reports on how the shop, part of a group of 41 restaurants, decided that—since revenues had sharply dropped due to the recession—a show of hospitality was the right way to get diners to loosen up. So from last July, it began offering free shoulder massages—“as a means of differentiation,” as a spokesperson puts it. Meanwhile, three companies of the JTB Group have started up a “solutions business” that provides advice on the hospitality industry, explaining the shoulder massage strategy to a “T.” “Many companies feel anxiety that they can only survive if they provide service at the level of ‘no dissatisfaction,’” a spokesperson for JTB tells Nikkan Gendai. “We’re getting more queries from companies asking, ‘What can we do to make customers remember us?’ In addition to manners and other basic

values, if you don’t get customers to feel some emotional value, they won’t become repeaters.”

October 2009 | The Journal | 19

ACCJ Event BEST PRACTICES FOR APPROACHING RESTRUCTURING WITH TRANSPARENCY, INTEGRITY AND A HUMAN TOUCH By Geoff Botting Photos by Mattias Westfalk

early all of us are experiencing the pain of the global downturn. But, perhaps, few are feeling it as acutely as those working in human resources. HR professionals are the ones who must oversee layoffs, and then deal with their myriad aftereffects. Not only can the retrenchment process be complex, but it can also exact a huge emotional toll on everyone involved— not just the victims, but also those tasked with carrying out the restructuring. Keiko Suzuki (above), an independent HR consultant with 20 years’ experience in the industry, knows this scenario all too well. The current economic situation—marked by sudden and extensive downsizing across practically all industries—is by far, to her reckoning, the most challenging she’s ever encountered. “The atmosphere is so different now. It is so fearful and stressful for a lot of people in the organization,” she recounted at an ACCJ event in Tokyo on March 5. “And people in general are scared about it.” These days, Suzuki and fellow HR ofﬁcers are made to feel like the grim reaper, scythe in hand, as they walk the hallways

20 | The Journal | October 2009

of their ofﬁces. Other employees seemingly give them a wide berth, throwing quick, sideways glances. “Foreign companies [in Japan] cut too fast, too deep. And that really affects the organization in its functions,” she said. “You have to look at the long-term, not just the shortterm, results. “We aren’t going to be in this recession forever. I don’t know when things will bottom out, but it’s going to turn around sometime. So if you cut too deep and too fast,” said Suzuki, “I think it’s really dangerous, and will hurt the organization in the long term.” Too often the end result is lowered productivity from weakened staff morale and heightened stress levels. “The fear is real,” she explained, “and the downturn of what’s happening in the organization is very real to many of us. “Even the top performers are affected,” continued Suzuki. “If the atmosphere is severe and people are leaving, then they will also start worrying about themselves—about whether the company will cease to exist.” In Japan, the costs of drastic layoffs can be especially high, according to Suzuki. That’s because capable bilingual staff

ACCJ EVENT

“Foreign companies [in Japan] cut too fast, too deep. And that really affects the organization in its functions,”

are hard to find in the best of times; so once you let them go, rehiring replacements will be all the more difficult. So how should HR people go about engineering the downsizing process? Suzuki suggested that first they need to establish a close link with the organization’s line managers who personally deliver the hard message during the termination discussions. It’s essential that the workers hear the bad news directly from their bosses, according to Suzuki; otherwise the employees may get the impression that bucks are being passed. The problem remains, however, that line managers often don’t possess the necessary skills, what Suzuki calls “the human touch.” “A lot of people don’t know how to say it or when to say it,” she observed, “so HR people must take the initiative to educate the line managers. “When you talk to people to give them this hard, difficult message, you really have to have good ‘soft skills.’ Your listening skills are especially useful,” explained Suzuki. “You really have to know what the person’s reaction will be, and make sure he’s taking it in a manner that he can really digest.” While these meetings should be brief and focused, the bosses should also be willing to listen to what the other side has to say. On the other hand Suzuki warned against what she called stickiness. “Keep your discussions straight and nonsticky,” she

said. “If it becomes emotional, then that might instigate anger. Just listen. Active listening is vital. Don’t forget to say ‘thank you’ at the end of the talk.” What happens when line managers don’t receive the necessary coaching, or ignore HR’s guidance? Suzuki recalled an episode to prove her point. “I had a bad experience with a manager who totally ignored the process, totally ignored HR, and would give the final words to his employees on his own terms, using words like, ‘You’re out of here,’” she said. “He ignored the process, and he was very often emotional about the situation.” That attitude provoked litigation by one disgruntled employee, which turned into a legal case that dragged on for 18 months. The worker spent the entire period at his desk “flipping the pages of the newspaper from 9 to 5 as a form of revenge.” “It was a disaster,” Suzuki said. “The company lost the case.” So the HR people should remain the ones behind the scenes, organizing the notification meetings, monitoring progress, and being available to answer questions from the managers and employees. If terminated, employees ask for a meeting afterward, then the HR people should be called on for the job. Even after the layoffs have been wrapped up, HR’s job is still far from done. “Don’t ignore the employees retained. Keep the communication lines open otherwise they could easily become demoralized,” she advised. Transparency in communications is key throughout the entire retrenchment process. As for best practices, everyone “needs to be on the same page.” HR people, managers, employee relations officers, said Suzuki, may want to make a manual, listing the do’s and don’ts of implementing layoffs. “If it’s a global firm, then the CEO or headquarters have to send out information on what’s happening—what’s the reality and the impact—to the internal people or external clients right away,” said Suzuki. “And the communications manager should help them out. Then that message should cascade down to the regional or local managers.” In both good times and bad, “communicate early and often.” As for specific measures for getting the message across, Suzuki mentioned regular town hall meetings. “That kind of face-to-face talk really makes people feel assured, feel that the company is really paying attention to people,” she said. So whatever you do amid the current Geoff Botting is a freelance economic gloom, advised Suzuki, “make sure journalist based it’s sustainable.” ■ in Tokyo.

October 2009 | The Journal | 21

From left: TBLI Group founder and CEO Robert Rubenstein, Siris Pty Ltd. Australia CEO Mark Bytheway, ICE Organisation, Ltd. founding Executive Chair Tessa Tennant, The Good Bankers President and CEO Mizue Tsukushi, and Emerald Capital Asia, Ltd. Director T. David Hodgkinson

TBLI Conference Report MAKING MONEY BY ADDING SOCIAL AND ENVIRONMENTAL VALUE. By Alana Bonzi

rganized with local support from Patricia Bader-Johnston, president of Silverbirch K.K., the Triple Bottom Line Investing (TBLI) Asia Conference in Yokohama last May looked at full portfolio engagement— ranging from public and private equity, ﬁxed assets, real estate and carbon markets. Based in the Netherlands, the TBLI Group is no newcomer to the sustainable ﬁnance space. For more than a decade, they have been involved in ESG investment, whereby environmental, social and governance issues are believed to affect the performance of a given portfolio across companies, sectors, regions, classes, and even over time. In Europe, they run the largest annual international networking and education conference on ESG investment. Besides conferencing, the TBLI Group offers in-company training

22 | The Journal | October 2009

and investor salons. They operate as a social enterprise, and the conferences are the way in which the organization shares its expertise in connecting, educating and extra-financial rainmaking. Why did TBLI CEO and Founder Robert Rubenstein start down this path? He looked at three pain levers in the economy—personnel, finance, reputation. First, he tried to effect change in the way managers are trained. He lectured, and still lectures, in an MBA program, but found progress slow and performance still measured in a biased way. With the reputation lever diffuse and complicated, Rubenstein turned to the finance lever. The top 100 asset owners, principals and agents that own a large portion of the world’s wealth seemed like the smallest pool to influence. He accomplishes this by raising awareness, positioning them in their comfort zone, and arranging for

them to meet to have discussions with their peers. The conference is set up to create the herd—the “buzz.” This year, in Japan, while there were fewer attendees, there was deﬁnitely “buzz.” Over two days, asset owners, wealth managers and researchers discussed the challenges and successes of ESG investment. One challenge is for the “quant guys”— those looking for statistical proof of what investors intuitively believe: better ESG, better business. During his presentation on the relationship between ESG rankings and investment returns, Stuart Peskin, vice president at State Street Global Advisors (Japan) Co., Ltd., couldn’t give conclusive evidence that highly ranked ESG companies consistently translated into higher performance than lower-ranked ESG companies. But, based on the assumption that the price of carbon is set to change, he

TBLI CONFERENCE REPORT

SNAPSHOT One challenge is the language of the industry itself, according to Mark Bytheway, CEO of Sustainable Investment Research Institute Pty Ltd. (SIRIS) in Australia. Although there are commonalities among the meaning of the jargon and acronyms—such as SRI, TBL (triple bottom line investing), Sustainable finance—ESG Green funds do obfuscate the non-initiated. TBLI defines ESG as follows: People (social equity) + Planet (environmental quality) + Profit (economic prosperity). ESG adds social and environmental value to external stakeholders, while increasing value for shareholders. ESG asks the question about whether, if to maintain profitability, your products/services worsen, maintain or improve the social and environmental balance.

did manage to determine that ESG payoff increases. ESG specialists, however, use a different approach when analyzing. Historical analysis is important, but not useful in examining the forward-looking issues that affect risk and that uncover hidden opportunities within companies and industries, according to Stewart Amer, the head of SRI (socially responsible investments) at Fortis Investments. He believes you should look to the future, as ESG is not compatible with back tests. You also should look at practical investment processes, with ESG playing out in society, governments, as well as policy, and at social and political issues via a multidimensional approach. However, many mainstream wealth managers look at both quantitative and qualitative, according to Floris Lambrechtsen, owner and director of Double Dividend B.V. His consultancy assesses investment managers. But what can asset owners do to get managers and analysts to look at ESG issues? According to Peskin of State Street Global Advisors, asset owners should say what they are looking for, and then give time and some space in the form of longer-term thinking. In contrast, Amer of Fortis Investments believes that many managers pay lip service—and should be asked to articulate exactly what they are doing about ESG issues, and how they take them into account. Lambrechtsen of Double Dividend believes that it is better to

provide a financial incentive and demand a transparent relationship. But what if there is no demand from asset owners? Can managers offer ESG screening? This question was answered in the 2005 Freshfields report—A legal framework for the integration of environmental, social and governance issues into institutional investment. One of the conclusions in the report was that it is within the fiduciary duty of principals and agents to include ESG issues as part of their due diligence in assessing investments. So managers can create demand simply by offering this. Rubenstein adds: “No consumer has actually said that they wanted an iPod before Apple created one.” Interestingly, though, while people buy green products, there is some reticence to buy green funds. But why? The jargon alone makes it difficult for everyone to understand. Furthermore, the same companies that are in regular funds are also in green funds. “This is not interesting, so perhaps it is better to look at themes and define your corner,” says Lambrechtsen. However, even with no demand—and even in this macroeconomic environment—investment still flows, in spite of itself. With green new deals and economic stimulus packages, there is a change in attitude among governments around the world. The link between the economy and new energy is much more clearly articulated. Former Vice President Al Gore, during his speech at Keio University last November, summed it up when he spoke of green jobs and green infrastructure as a stimulus that is both useful for society and good for the economy. The economic crisis brought with it fears of a return to short-termism. But, according to Dr. Eric Martinot of the Renewable Energy Policy Network for the 21st Century (REN21), there has been a quadrupling of investment in new renewable energy. In REN21’s 2009 update of its Renewable Global Status report, the U.S. “became the leader in new capacity investment with $24 billion dollars

Interestingly, though, while people buy green products, there is some reticence to buy green funds. But why? The jargon alone makes it difficult for everyone to understand. Furthermore, the same companies that are in regular funds are also in green funds. invested or 20% of the total global investment in 2008.” Money has been flowing to green transport and green buildings. The latter, considered low hanging fruit, has its niche players such as France’s Saint-Gobain SA. The company is set to pick up a lot of business refitting public buildings. Green Real Estate also outperforms in the U.S. with a 16% increase per square foot. In green transport, Vossloh AG, a German rail-fastener company, has picked up €170 billion worth of tenders from China Rail, and the company has over 50% more tenders forthcoming. China Rail expects to invest $146 billion in its rail system in 2010. The dot.corn revolution in the U.S., according to Michael Liebreich of New Energy Finance Limited, has led to more research in second-generation algaebased biofuels. But, more importantly, in a survey of 106 institutional investors who answered the question of whether they were going to invest more or less in clean energy by 2012, 75% said more. “An inflow of funds is expected within the next three years,” says Liebreich. “There is a realization that fossil fuels seem to be riskier and clean energy less so.” But will these stimulus packages and money-flow trickle down in time?

October 2009 | The Journal | 23

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TBLI CONFERENCE REPORT

ACCJ CSR Committee Chair and Silverbirch Associates K.K. Representative Director and CEO Patricia Bader-Johnston

From left: Double Dividend Director Floris Lambrechtsen, Fortis Investments SRI head Stewart Amer, and State Street Global Advisors Vice President Stuart A. Peskin

“Probably not,” answers Cesar de Brito of France’s EcoResponsible Partners (ERC). So what about the little guys: green micro players with great ideas, buffeted by the economic crisis and with no more access to funding? Those who got listed to keep staff are suddenly finding themselves having to delist as their market values fall—or are perceived to fall. According to de Brito, there is an expectations gap that can be explained by fear of risk. These small businesses are perceived as being too risky for many investors and banks. Because of that perception, they miss the inherent potential for return, and this is where ERC steps in. They work closely with the founders and managers to provide the guidance and the funds to get the business back up on its feet. In Japan, out of $278 billion worth of stimulus packages, $64 billion are earmarked for sustainable activities, with a significant portion going to renewable energy. ESG investment and interest in SRI should be at an all-time high. That’s not the case, say both Rubenstein of TBLI, and Founder and CEO Mizue Tsukushi of The Good Bankers Co., Ltd. In Japan, according to Rubenstein, the SRI focus has been off target, and didn’t communicate in the target language of the financial planners. SRI was not placed in the context of performance and reward upon which people’s jobs rely. Tsukushi

added that, while there has been some progress among pension funds, resistance is still there. In Asia, in general, the tide is changing slowly. Tessa Tennant, founding executive chair of the board at The ICE Organisation, Ltd. (an environmental rewards program), explained that there is a change in the perception—of another Western imposition and another wave of colonialism—as to how ESG issues are applied to Asian financial institutions on Asian terms. According to Lambrechtsen of Double Dividend, “the SRI market is extremely immature. It’s a nascent industry with everyone coming up with their own taxonomy.” Then there are different types of “green”—from dark green to pale green— like many mainstream financial institutions and funds. Standard Chartered Bank, this year’s runner up in the Sustainable Bank of the Year Awards, is one of the mainstream financial institutions that are part of the SRI movement. An example of a dark green bank is ASN Bank in the Netherlands. With one branch, 90 employees, and 400,000 customers and 1,000 new customers per week, Ewoud Goudswaard, general manager, must be doing something right. The ASN Bank has successfully attracted ethically bound committed investors by being “Who they are”—by communicating

that clearly—and by being able to answer the question, “What are you doing with our money?” With €6 billion in savings, the ASN Bank has quite a lot of money to invest—but not just any investment. Goudswaard related that they follow strict ESG parameters when choosing to make investments. Once in a while these parameters prove to be too restrictive for a potential client, however. But, instead of compromising, the ASN Bank prefers not to take that client on. “There is a misconception that taking a sustainable investment path is a cost, while it is [actually] the opposite,” says T. David Hodgkinson, director of Emerald Capital Asia Ltd. He should know. With a return of 47.5% on his funds, Hodgkinson ﬁnds that many investors are interested in what he has to offer. Rubenstein described the TBLI conference as a party where people share, learn and are inspired. “It’s a party, but we got there early,” he says. Being a social enterprise, though, they constantly seek partners to collaborate on conferences, investor salons, on sponsorship. This was TBLI’s ﬁrst time to Japan, and already plans are underway for next year’s confer- Alana R. Bonzi is an adjunct ence. In the meantime, the lecturer at Keio party continues on at the ACCJ, University and a with the CSR Green Market consultant. Conference on September 30. ■

October 2009 | The Journal | 25

ACCJ EVENT REPORT

Tokyo Charity Ball Walkathon

he ACCJ held its inaugural Charity Ball Walkathon in Tokyo on Saturday, September 12 in Chidorigafuchi Park, with 120 participants walking the 5km perimeter of the Imperial Palace in pouring rain. “Despite the rain, our ﬁrst Walkathon in Tokyo went well and exceeded expectations. We would like to continue this effort and target 500 walkers next year,” said ACCJ Special Events Committee Chair Barry Bergmann. A walkathon is a type of fundraising event in which participants collect donations or pledges for walking a predetermined distance or course. ACCJ members, families and guests contributed ¥2,500 to participate. Participants under 18 contributed ¥1,000. Allied Pickfords, Coca-Cola, Latham & Watkins LLP, Reebok and United Airlines sponsored the event this year. All net proceeds from the event (approx. ¥580,000) will be donated to organizations such as the

YMCA/ACCJ Ohisama Camp, Nonohanano-ie Children’s Home, and others. The ACCJ Chubu Chapter, in cooperation with the Nagoya International School, has successfully held a walkathon in

Nagoya for the past 18 years. The ACCJ Kansai Chapter will hold its 4th walkathon in Nakanoshima Park as a part of the “Aqua Metropolis Osaka 2009” event on Saturday, October 3.

ACCJ 2009 CHARITY BALL

CONTINUING A TRADITION OF GIVING By Shaun Dubin and Jeffrey Shimamoto

he annual ACCJ ball has been for the last 60 years the one party to celebrate the end of the year for the American business community in Japan. Following the marking of the Chamber’s 60 years in Japan with the Diamond Charity Ball in 2008, this year’s Ball will be called the ACCJ 2009 Charity Ball “In the Black” to reflect the Chamber’s commitment to helping its member companies maintain or return to black. The annual ball has always been an exciting event well attended by some of the most powerful and influential members of the American business community in Japan. Past events have included the U.S. Ambassador and his wife; the Chiefs of the Army, Navy, Air Force and Marines; foreign dignitaries; Japanese political leaders and senior officials of the Japanese government, as well as entertainers from television and film. Closely working with the Community Service Advisory Committee (CSAC) helps the ACCJ carry out its philanthropic efforts through the annual Charity Ball. The CSAC has chosen three “Primary Charities” to which a majority of the Charity Ball donations will be made this year. The primary beneficiaries for our 2009 event include the following:

YMCA Challenged Children’s Project – YMCA/ACCJ Ohisama Camp The YMCA Challenged Children Project

(CCP) began in 1987 in cooperation with the National Council of YMCAs of Japan and the Tokyo YMCA. The CCP’s goals are (1) to support the development of challenged children through camp activities, to develop self-confidence and skills for independent living and learning, and to support facilities for the challenged; and (2) to support and promote integration into mainstream society by holding friendship camps, and to provide experience and training for current and future volunteers and professionals. The funds raised at the ACCJ 2009 Charity Ball will be used directly to support the YMCA/ACCJ Ohisama Camp, a Tokyo YMCA Center program held in late summer, in cooperation with the ACCJ, where an expected 40 children with conditions such as Asperger’s Syndrome, Attention Deficit Hyperactivity Disorder, Information Processing Disorders and other Learning/ Developmental Disorders can enjoy the outdoors and participate in camp activities. Nonohana-no-ie (Wildflower House) Founded in 1984, Nonohana-no-ie Children’s Home is located not far from the coast, in the city of Kisarazu, Chiba Prefecture. It has provided a secure homelike environment for hundreds of Japanese and non-Japanese children who are the victims of child abuse, neglect and other inhumane treatment. The facility currently accommodates approximately 40 children aged 2-18. Nonohana-no-ie Children’s Home acts as ’a

second home, with each unit providing a warm, secure, family condition. The group’s efforts and contribution to the promotion of children’s welfare were recognized and awarded by UNESCO (United Nations Educational, Scientiﬁc and Cultural Organization), as well as by the Prime Minister of Japan and the Emperor of Japan. The applied proceeds received from the ACCJ 2009 Charity Ball will be used for building repairs and for school supplies for the children living there. Waku Waku Workshop The Waku Waku Workshop (WWW) is the ﬁrst metropolitan workshop established mainly for the deaf and blind. WWW started its operations in 2007 in Sorimachi, Kanagawa Prefecture. It provides a safe place for those with sight, speech or hearing disabilities to improve their involvement in the community through activities with all the participants, staff and volunteers. Each participant has different objectives at WWW, so the workshop’s goal is to value each individual’s character and talents in order for everyone to be better able to express his or her individuality. The ACCJ 2009 Charity Ball is on Friday, December 4, at the Westin Tokyo Hotel in Ebisu. Tickets can be purchased on the ACCJ Web site (www.accjcharityball.org/). Book your tickets soon, as capacity for this popular event is limited. October 2009 | The Journal | 27

ACCJ Golf Subcommittee Report SUCCESSFUL DRIVE TO RECRUIT AND ENGAGE MEMBERS. By Julian Ryall

28 | The Journal | October 2009

SUBCOMMITTEE REPORT

It was the famous U.S. sportswriter Grantland Rice who wisely stated that 18 holes of match play would teach you more about your foe than 18 years of dealing with him across a desk. The Chamber hopes a round or two will equally cement new business

The ACCJ Golf Subcommittee has evolved out of the combined efforts of Timothy Langley and Bennett Galloway. “I handle the in-town events and Bennett the on-course ones. It’s a great partnership,” says Langley, president of legal consultancy Langley Enterprise. Teeing off only six months ago, the group has mushroomed to 160 members taking part in twice-monthly golf events. “We have several aims for the initiative, not the least of which is to offer something our members can’t easily ﬁnd elsewhere,” says Langley. “This uniqueness, and the fun and camaraderie, contribute to attract new members and keep existing members more engaged and happier.” Pointing out that golf typically offers panoramic views, undulating fairways and mature trees, Langley points out that, “This is not just good exercise and a way of exorcising workplace stress, but how else can an executive interact with nature in Japan? “Ours is a venue where people can develop a game and non-members can join, both without actually leaping into either golf or the Chamber,” he says. The Golf Subcommittee is the only arm of the Chamber open to outsiders, having an understated goal of attracting new members in the process. “This is moving very successfully,” Langley says. “The Chamber’s other committees are obviously related to business and there has not been, until now, a group dedicated to fun, athletic pursuits

TONY MCNICOL

alliances and attract new members as well.

Timothy Langley

that help members in life-skills in addition to career-skills. “Golf, if you think about it, is a unifying thread throughout our Chamber,” he adds. “Businesspeople from wildly different areas come together here and business relationships naturally evolve.” Once a month, members visit a tripledecker driving range to practice their long game, paying ¥3,000 for as many balls as they can hit in 90 minutes. The Kasai range is a current favorite, a mere 30 minutes from central Tokyo. Another central feature is golf at courses close to the city—frequently costing as little as ¥10,000—and rounds spread over two days at more distant fairways and greens. For example, the group recently ﬂew to Hokkaido, played 18 holes on Saturday, another round on Sunday,

Bennett Galloway

and was back in Tokyo by Sunday evening. The whole package, including ﬂights, cost a reasonable ¥52,000. Okinawa is the next scheduled destination. A nearby regular favorite is the Gotemba Golf Club, which combines stunning views of Mount Fuji, a cocktail of challenging and more straightforward holes, and the watchful tutelage of course pro Bennett Galloway, Co-chair of the subcommittee with Langley. “We really want to make the subcommittee inexpensive and open to those with a golf interest,” says Langley, who has special dispensation to use social networking tools—LinkedIn and Google—to keep Julian Ryall is The Daily members up to date and to Telegraph’s Tokyo attract new players, another correspondent. ﬁrst within the Chamber. ■

October 2009 | The Journal | 29

Working together Since its establishment in 2005, Morgan Lewis-TMI has been involved in many of the largest and most sophisticated M&A transactions involving Japan. Our alliance enables our clients to call upon the combined resources of TMI Associates’ more than 200 Japanese lawyers as well as Morgan Lewis’s 1,400 lawyers and 22 ofﬁces worldwide. Working together, we are able to provide our clients with an unmatched depth and breadth of expertise across practice areas and industries. For more information on Morgan Lewis-TMI, please contact: Kunio Namekata Lisa Yano Gregory R. Salathé Kiyoshi Takahashi

P: P: P: P:

+ + + +

81.3.6438.5503 81.3.4578.2507 81.3.4578.2509 81.3.6438.5533

E: E: E: E:

kunio_namekata@tmi.gr.jp lyano@morganlewis.com gsalathe@morganlewis.com kiyoshi_takahashi@tmi.gr.jp

Morgan, Lewis & Bockius LLP - TMI Associates (Registered Association)

www.morganlewis-tmi.jp

he ﬁnancial crisis and global recession brought a

domestic sales and manufacturing staff, as well as a Japanese customer

dramatic decline in M&A around the world, and Japan was

base to buy their global product lines.

no exception. As the global economy begins to recover, we are seeing increasing signs that the M&A market is

Distressed Opportunities. The potential tie-up between JAL and, at

recovering as well. However, the M&A market in Japan is

the time of writing, either Delta or American, shows that there are still

really several different markets, which are recovering and growing at

opportunities for foreign ﬁrms to invest in premier Japanese brands

different paces.

facing financial trouble. Foreign financial firms, on the other hand, are eyeing the real estate market as a source of new distressed deals.

Domestic Deals. Domestic acquisitions in Japan have historically

Declining real estate prices and rents have produced non-performing

been driven by mergers between troubled ﬁrms or mergers in which

loans, distressed properties and a crisis in the REIT market, which may

a financially healthy firm acquires a troubled firm. The recently

be attractive to foreign funds with a strong tolerance for risk.

announced merger between Kirin and Suntory is representative of a new trend in Japanese domestic deals where, in reaction to the shrinking domestic market, industry leaders combine in order to better compete on the global stage. Large domestic mergers will not only rationalize the domestic market, they may also create stronger platforms for global expansion. For example, expect a merged KirinSuntory to do more deals similar to Suntory’s announced acquisition of the French drink-maker Orangina. Outbound Acquisitions. Global acquisitions by Japanese companies will be one of the larger trends in the M&A market in the near future. Armed with a strong yen, and facing a shrinking domestic consumer market, many Japanese companies see international expansion as the best strategy for growth. In addition, pharmaceutical ﬁrms have been acquiring U.S. and European start-ups as a way to acquire R&D

Most of these transactions rely on legal reforms and structures developed earlier this decade. One recent legal development, however, could have significant impact on the M&A market. The Japanese Diet has approved major anti-trust reforms, expected to become effective in early 2010. These reforms are intended to bring Japan’s M&A competition rules in line with global standards with the introduction of pre-acquisition filing requirements and uniform thresholds applicable to domestic and overseas companies. Moreover, the new political order in Japan may enforce these rules more vigorously. We expect Japanese anti-trust issues will become more important, not only for domestic transactions, but also for global M&A deals in which one or both of the parties have significant operations in Japan.

and new products. If the domestic economy strengthens, expect

After the recent downtrend in the M&A market, many professionals in

more companies to use their cash to buy foreign brands, products and

this ﬁeld are looking forward to new growth. We believe the recent deals

distribution channels.

in Japan and the U.S. are signs that the market is rebounding, bringing new M&A opportunities for Japanese and foreign corporations.

Domestic Spin-offs. Tight credit markets, a shrinking domestic market and ﬁerce international competition continue to pressure many

Gregory R. Salathé

domestic companies to restructure and refocus. As a result, many

Partner, Morgan Lewis-TMI

companies are focusing on their core businesses and are interested in

gsalathe@morganlewis.com

shedding their unproﬁtable operations. Spin-off transactions create a business opportunity for foreign ﬁrms to enter the Japanese market by

Kiyoshi Takahashi

acquiring the operations of a leading company. Acquiring a spun-off

Partner, Morgan Lewis-TMI

division can give a foreign company instant access to a talented

ktakahashi@tmi.gr.jp

October 2009 | The Journal | 31

MERGERS AND ACQUISITIONS | Special Advertising Section

A Growing Revival in the M&A Market

MERGERS AND ACQUISITIONS Special Advertising Section

Anderson Mori & Tomotsune

Atsumi & Partners

Tel:

03-6888-1000

Tel:

Web:

www.andersonmoritomotsune.com

Fax:

03-5501-2211

Web:

www.apap.gr.jp

03-5501-1166 (Bonnie Dixon)

Results Speak Louder Than Words • Japanese Deal Firm of the Year and Japanese Dealmaker of the Year - 2009 Asia Legal Business Awards • Top Group Rankings for Corporate/M&A - Chambers Asia 2009, Legal 500 2008 and 2009 • Merger of Aozora Bank, Ltd. and Shinsei Bank Ltd. - combined assets of ¥18,000 billion (approximately $189.5 billion) (pending) • BlackRock’s Acquisition of the Business of Barclays Global Investors – Japan component of the $13.5 billion global transaction • Silver Award for Best Law Firm in Japan - 2009 - M&A and Corporate Finance Practice - International Legal Alliance Summit • JPMorgan Chase & Co.’s Acquisition of The Bear Stearns Companies Inc. – Japan component of the $1.2 billion global transaction • Gold Award for Best Law Firm in Japan - 2008 - M&A and Corporate Finance Practice - International Legal Alliance Summit • Shinsei Bank Ltd.’s Acquisition of GE Consumer Finance - ¥580

Atsumi & Partners is one of Japan’s leading independent law firms and was the first Japanese law firm to admit non-Japanese partners, Ms. Bonnie Dixon, a New York lawyer; and Daniel Hounslow, an English lawyer—both with more than 20 years’ experience; and John Shanahan, an Ohio lawyer. We operate as a fully integrated international team, providing advice on complex domestic and crossborder matters to the standards the modern business community expects. Atsumi & Partners has for some years been widely regarded as Japan’s premier law firm in the fields of securitization and structured finance, and now offers its clients a full-service capability with international experience in finance, banking, real estate finance, private equity, investment funds, mergers and acquisitions, securities, syndicated loans, derivatives, public offerings, private placements, information technology, intellectual property, general corporate law, trust law, bankruptcy, insolvency, restructuring, due diligence, compliance, litigation and arbitration.

billion (approximately $6.1 billion) • Kyocera Corporation’s Acquisition of Sanyo Electronics Co., Ltd.’s Mobile Phone Business - ¥43.7 billion (approximately $460 million) • Leading Tax Law Firm - 2008 and 2009 Tax Directors’ Handbook

AP Outsourcing Tel:

03-5228-1820

Fax:

03-5228-1830

Web:

www.APOutsourcing.jp

AP Outsourcing (APO) is an independent outsourcing provider of Accounting and Payroll with Big Four experience (Arthur Andersen and KPMG). It was separated from Azsa Audit Corporation (the audit group of KPMG Japan) in April 2004. AP Outsourcing provides bilingual staff with extensive experience and knowledge of ﬁnancial operations, payroll and tax, helping you compete better and accomplish your goals. Start-up Support: APO provides business start-up support for new foreign corporations and venture companies, including legal

Elanex Tel:

03-4530-3883

Fax:

03-4496-4309

E-mail: info@elanex.com Web:

www.elanex.com

Elanex is a leading global translation company headquartered in the U.S. Elanex develops and deploys leading-edge technology designed to increase the efﬁciency and reduce the cost of high-quality translations by the best translators in the world. These savings are passed on to the client. With over 20,000 translators and covering more than 104 language pairings, Elanex is introducing a revolution in the way the translation process is managed. Legal translations are a specialty and Elanex has handled many very large projects such as the recent translation of over 20,000,000 words in six weeks as part of an M&A. Elanex was also responsible for translation of major documents, both ﬁnancial and legal, in one of the largest corporate takeovers conducted in Japan. For single page translations to multimillion-word texts, Elanex will provide the total translation solution.

registration, tax and social insurance applications. Project Management: Effective and efficient project management support for outsourcing migration. Outsourcing Operations: Well-qualified bilingual accountants, tax/social insurance specialists and system experts accurately and promptly provide outsourcing operations, focusing on the confidentiality of accounting payroll/information. Loan Staff: Accounting/payroll processes are facilitated by the placement of our own specialist staff in the clients’ offices for specific periods. APO also offers other specific services and support on request. For more information on how we can help you to simplify your business processes, call AP Outsourcing at 03-5228-1820.

32 | The Journal | October 2009

Ernst & Young Shinnihon Tax Tel:

03-3506-2411

Web:

www.eytax.jp

Ernst & Young’s tax professionals in Japan provide you with deep technical knowledge, both global and local, combined with practical, commercial and industry experience. Our highly regarded tax and M&A advisory, compliance and transfer pricing professionals, consistent methodologies as well as unwavering commitment to quality service help you to build the strong compliance and reporting foundations and sustainable tax strategies that help your business

lawyer in the June 2009 issue of Nikkei Business Magazine and were ranked among the most active lawyers in corporate legal affairs in 2008 by The Nikkei.

Nagamine Accounting Ofﬁce

Morgan Lewis-TMI Tel:

03-4578-2650

Fax:

03-4578-2501

Tel:

03-3581-1975

Web:

www.nagamine-mri.com

Morgan Lewis-TMI is a joint venture between Morgan, Lewis & Bockius LLP and TMI Associates. This unique alliance between two market-leading firms enables our clients to tap the resources of more than 200 Japanese and U.S. lawyers in Japan and another 1,400 lawyers worldwide, providing expertise across the full spectrum of practice areas and industries. In the past few years, we have represented both U.S. and Japanese clients in complex, high-profile M&A transactions involving Japan, in industries including financial services, automotive, semiconductors, life sciences, media, chemicals, food products and food services, industrial materials and energy, among others. Our practice in Tokyo also includes restructuring, finance, private equity, licensing and other technology transactions, labor and employment issues, dispute resolution, and corporate, regulatory, tax and securities matters. If you have any questions about our practice, please contact Greg Salathé, Lisa Yano, Kunio Namekata or Kiyoshi Takahashi at 03-45782650 or by e-mail.

Since 1989, Nagamine Accounting Office has been assisting foreignaffiliated firms (nearly 80% of our clients are foreign-affiliated) expand their business operations into Japan by providing expertise in the areas of tax and accounting. NAO supports the business start-up process in Japan, thus offering payroll and cash management services. Our main areas of service are as follows: Transfer Pricing Consulting: Evaluating taxation risk based on client interviews and the analysis of internal information regarding relatedparty transactions. We offer the appropriate solutions on transfer pricing risk management. Audit: When foreign-affiliated companies implement voluntary audits in Japan for the purpose of M&As or per request of the parent company, NAO can support with the proper handling of audits and due diligence. Tax & Accounting: NAO tailors all of services to the needs of our clients, from routine bookkeeping to the preparation and review of financial statements in accordance with the IFRS or US GAAP. Payroll: NAO can provide payroll accounting and social insurance services for our client. Cash Management: NAO can also act as an expense clerk service; by giving authorization to wire vendors, we can perform the majority of back-office financial functions. For more information, please contact Shinya Nishi at nishi@nagamine-mri.com

Mori Hamada & Matsumoto

Nagashima Ohno & Tsunematsu

Tel:

03-3288-7000

E-mail: mhm_info@mhmjapan.com

Fax:

03-5213-7800

Web:

E-mail: info@noandt.com

E-mail: kunio_namekata@tmi.gr.jp gsalathe@morganlewis.com lyano@morganlewis.com kiyoshi_takahashi@tmi.gr.jp Web:

www.morganlewis-tmi.jp

03-6212-8330 (Public Relations) www.mhmjapan.com

Web: Mori Hamada & Matsumoto is a full-service international law firm based in Tokyo, with offices in Beijing and Shanghai. The firm has approximately 300 attorneys and a support staff of approximately 400, including legal assistants, translators and secretaries. The firm is routinely involved in the most complex and high-profile transactional work in Japan and has earned high rankings in league tables as well as numerous awards for its work in a variety of fields. The firm was ranked No. 1 for its M&A work in 2008 by Thomson Reuters, Bloomberg and mergermarket. For its recent work on the acquisition of a stake in Morgan Stanley by MUFG, the firm received “Japan Deal of the Year” and “M&A Deal of the Year” from ALB and “Deal of the Year” from Asian Counsel. Among other awards, the firm has received “Client Choice Awards 2008” from ILO; “Intellectual Property Law Firm of the Year” (2008) and “The Employer of Choice 2008” from ALB; and “Asia Tax Awards 2008” from International Tax Review. The firm’s lawyers also received top rankings as business

www.noandt.com

Nagashima Ohno & Tsunematsu, established in 2000, is widely known as a leading law firm in Japan, and a foremost provider of international and commercial legal services. We have successfully structured and negotiated many of Japan’s largest and most significant corporate and finance transactions, and have deep litigation strength spanning key commercial areas, including intellectual property and taxation. In M&A transactions, we represent clients covering virtually all business and financial sectors. We are familiar with an extraordinarily wide range of specialized legal situations, such as: M&A deals stemming from bankruptcy or insolvency proceedings; tender offers targeted at listed companies; M&A deals based on statutory mergers, stock for stock exchanges or spin-offs and combinations of each these. In all these instances, we stand ready to provide the most up-to-date advice. We have a well-established reputation in the

October 2009 | The Journal | 33

MERGERS AND ACQUISITIONS | Special Advertising Section

achieve its ambitions. It’s how Ernst & Young makes a difference. If you would like further information regarding domestic or international tax matters, please contact Shinichi Tanimoto at 03-3506-2843 or shinichi.tanimoto@jp.ey.com, or John Kondos at 03-3506-2596 or john.kondos@jp.ey.com

MERGERS AND ACQUISITIONS Special Advertising Section

area thanks to our extensive experience in a wide variety of aspects of the M&A process, from strategy and due diligence, drafting and negotiation of all contracts and related documentation, to postmerger integration strategies as well as takeover defense strategies and measures. Contact: (Ms.) Yuko Tamai (Dai-ichi Tokyo Bar Association).

Asia-Paciﬁc, the Americas, and EMEA. More information is available at www.towersperrin.com. Established in Japan 25 years ago, Towers Perrin employs 60 Tokyo-based professional staff providing a full spectrum of HR consulting services. These services range from HR implications of M&A transactions to retirement plans, executive compensation & rewards benchmarking and design, to employee research, workforce communication and change implementation strategies.

Tohmatsu Tax Co. Tel:

03-6213-3800

Fax:

03-6213-3801

E-mail: tax.cs@tohmatsu.co.jp Web:

www.deloitte.com/jp

Tohmatsu Tax Co. is a leading member firm of Deloitte Touche Tohmatsu, an international association of accounting firms with over 165,000 professionals in 140 countries worldwide. We are a global provider of high-quality professional tax services tailored to the specific needs of multinational investors focusing on Japanese business opportunities. We provide a full range of tax services to our clients, which include many of the largest U.S.-based MNCs operating in Japan. In addition, we have assisted our clients as tax advisors on some of the largest M&A transactions in Japan across a wide range of industries, and provide guidance to a number of Japan’s largest corporations in structuring and organizing their international transactions and tax affairs. We have extensive experience in advising on all aspects of cross-border transactions, including transfer pricing and global employee rewards planning. Our knowledge is more than theoretical; and with our wideranging practical experience of all types of tax consulting and compliance, we will go the distance to model tax solutions to fit the commercial needs of our clients. With this approach, we can help you to identify both issues and opportunities, to help you reach your goal of tax optimization in Japan. For more information, please contact Yoshitaka Hasegawa at 03-6213-3800.

We are a leading consulting ﬁrm advising Western and Japanese corporations on realizing strategic business objectives through people. Bringing global best practices to bear while working with local country management and corporate executives to address key HR program design and governance issues, along with program ﬁnancial reporting and risk management. We also assist organizations to re-align organizational structures to match business plans relevant to recent economic conditions. Please contact Steve Allan at 03-3581-6602 or steve.allan@towersperrin.com with further questions.

White & Case LLP White & Case Law Ofﬁces (Registered Association) Tel:

03-3259-0200

Fax:

03-3259-0150

Web:

www.whitecase.com

White & Case LLP is a leading global law firm with lawyers in 36 offices in 25 countries. Our Tokyo office, established in 1987, has a long and successful history, and is considered one of the foremost foreign law offices in Japan. We bring together a leading domestic practice and one of the largest number of registered foreign attorneys (Gaikokuho Jimu Bengoshi). Our lawyers work together through a registered association (Gaikokuho Kyodo Jigyo) to offer legal advice to both Japanese and international clients across key practice areas. White & Case Tokyo regularly advises on both public and private deals and is a leader in Corporate/M&A services in Japan.

Towers Perrin Japan

Leading multinationals, major commercial and investment banks, entrepreneurs and visionaries alike have turned to our team of

Tel:

03-3581-6602

foreign and Japanese M&A lawyers to structure complex transactions

Web:

www.towersperrin.com

with precision and speed. This includes intricately structured domestic and cross-border mergers and acquisitions, spin-offs,

Towers Perrin is a global professional services firm that helps organizations improve performance through effective people, risk and financial management. The firm provides innovative solutions in the areas of human capital strategy, program design and management, and in the areas of risk and capital management, insurance and reinsurance intermediary services, and actuarial consulting. Towers Perrin has offices and alliance partners in major countries across the

34 | The Journal | October 2009

leveraged buyouts, joint ventures, strategic alliances and equity investments, including many multi-billion dollar deals involving multiple jurisdictions. With extensive experience in the international arena, our M&A and corporate lawyers have the knowledge, infrastructure and strategic perspective that are invaluable in helping clients select, implement and coordinate their strategies around the world.

e continue to read about a steady stream

talent in a timely manner. The due diligence process is generally

of M&A activity in the press as companies

the ﬁrst opportunity to identify key capabilities. This should be

continue to see value of corporate transactions

followed up with appropriate retention mechanisms and workforce

as part of their growth strategy. Indeed, our

communications to ensure target individuals “buy in” to the transaction

recent research shows companies who use

and understand the longer-term personal value in the deal.

M&A to grow tend to outperform their peers and companies who have completed mergers or acquisitions since the beginning of the

Cultural assessment

global economic downturn outperformed their non-acquisitive peers.

In cross-border transactions and any deal where a Western

However, research also shows that one of the most difﬁcult aspects

multinational expands within an overseas location such as Japan, an

of conducting successful transactions lies in HR, and the oft-quoted

understanding of the workplace culture is extremely important. This

reasons why deals fail, particularly in cross-border transactions where

assessment should be built upon a robust methodology that allows

clashes of culture and management style can play havoc on the best-

management to objectively measure workplace culture (i.e., “how work

laid business plans.

gets done around here.”) It is also essential that a buyer understands how its culture compares to the target’s culture. A failure to understand

Several M&A success factors exist. The following paragraphs outline key

workplace culture can rapidly lead to key employee disengagement,

elements for deal success.

attrition, and is one of the most cited reasons why deals fail.

Robust due diligence

Integrating the HR activities within the deal team

Strict due diligence is an essential part of any successful transaction.

It is essential that each of these HR-related activities is built into the

M&A savvy organizations planning transactions will ensure that the

transaction process from the initial due diligence, the deal pricing

HR function is “M&A ready” so they can hit the ground running as

and negotiations, and into the business integration. Transactions

soon as a deal goes live. A robust HR due diligence process includes the

typically occur at speed with limited information. Executives need to

fundamental steps ensuring signiﬁcant liabilities, such as beneﬁt plans

be comfortable with this fact, and to understand the HR implications

and compensation structures, are understood and costed. We have seen

of decisions being made throughout the deal process in a volatile

deals terminate when due diligence efforts uncover signiﬁcant pension

environment in order to make appropriate judgment calls regarding

liabilities. Equally important, the due diligence process provides a “ﬁrst

deal viability.

look” opportunity into longer-term HR objectives, such as workforce integration and harmonization of policies and practices, and ensures

Experience and research shows that a failure to address the HR aspects

the ﬁnancial implications of these are estimated so they can also be

of a transaction is the most commonly cited reasons why deals fail.

built into the overall deal pricing.

Conversely, organizations that conduct transactions with robust and thoughtful approaches to addressing HR challenges, deliver material

Key talent identiﬁcation and retention

value through their mergers and acquisitions.

Many transactions are built upon an objective of growing capabilities. In other words, they are acquiring the human assets of an organization.

Steve Allan

Companies in these deals, therefore, rely upon identifying key talent

Principal, Asia Regional M&A Lead

within a target organization, retaining them, and on-boarding that

Towers Perrin

October 2009 | The Journal | 35

MERGERS AND ACQUISITIONS | Special Advertising Section

The Human Aspect of M&A

As the only independent Tokyo law firm with foreign Partners, we combine local expertise and real international experience to provide a service to the standards required by the modern international business community. We advise on all aspects of finance and business law and, in addition to our core Japanese law practice, we are able to advise on English, German, PRC, New York and Ohio law. For further information on how we can help you, please visit our website or contact one of the following Partners: Hiroo Atsumi - hiroo.atsumi@aplaw.jp Bonnie Dixon - bonnie.dixon@aplaw.jp Daniel Hounslow - daniel.hounslow@aplaw.jp

Fukoku Seimei Building 䋨Reception: 12th Floor䋩 2-2 Uchisaiwaicho 2-chome Chiyoda-ku, Tokyo 100-0011 Tel: +81 (0)3 5501 2111 / Fax: +81 (0)3 5501 2211 www.aplaw.jp

TOKYO

Asian-Counsel’s

“Most Responsive Firm of the Year 2009 – Japan”

4th Annual ACCJ Kansai Charity Walk and Festival in Osaka Saturday, October 3, 11:00-16:00 Nakanoshima Park, Osaka City

nder this year’s theme, “Improve the Environment for Working Women in Japan,” the ACCJ Kansai Charity Walk and Festival in Osaka continues to grow in size

Women in Business

and impact since its establishment in 2006. Last year’s

(WIB) Committee Chair

record-breaking number of participants—over 2,000—enabled ACCJ

Mari Nogami shared

Kansai to donate ¥8.5 million to local NPOs and charitable organiza-

her great experiences

tions such as for family support, life-work balance, women’s education and development, counseling and training programs. The ACCJ Kansai Community Service Committee and Women in Business Committee collaborate to carry out the Corporate Social

with participants at this event in 2008. WIB will also feature

Responsibility initiative—emphasizing how leveraging women is a

some interesting

key element to grow the business in Japan.

events for participants

We are looking forward to your attendance, donations and collaboration for the ACCJ Kansai Charity Walk and Festival in Osaka.

of the 2009 ACCJ Kansai Charity Walk & Festival in Osaka.

Contact: ACCJ Kansai ofﬁce. Tel: 06 6345 9880 http://www.accj.or.jp/user/432/walkathon/

October 2009 | The Journal | 37

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JESPER KOLL WRITES

Outward Bound Japan Inc. Profit Margins (%)

5.0

Overseas

4.5

Margin by Region

4.0 3.5 3.0

Domestic

Asia

5.6

China

4.9

U.S.

4.8

Europe

3.5

Domestic

2.8

2.5 2.0 1.5 1.0

2000 2001

2002

2003

2004 2005

On top of higher profitability for overseas operations, market growth potential is clearly pulling Japanese investments overseas. Basically, even the most bullish optimists on Japan—please include me in this camp—have had to concede that the growth potential of the Japanese economy is probably around 1.5%. More sanguine economists would suggest 1% is a better guess. In other words, over the next decade, Japan may grow around 1% or 1.5% on average. Against this, most economists now estimate U.S. potential growth at around 2.5%. That is down from the pre-crisis 3.5% or even 4%, but still significantly higher than the figure for Japan. And you guessed it, China and other Asian countries are even more impressive, with around 9% for China and 5% for the rest of Asia. But the message is clear: almost all overseas markets have a higher growth potential than has Japan’s domestic market. So whether you are selling cars, construction machinery, memory chips, or whether you are selling soft drinks, diapers, cosmetics or financial services—overseas markets offer tailwinds from higher growth compounded by lower costs and higher profitability. So what can be done to entice Japan Inc. to reinvest at home? Policies that lower the cost of doing business in Japan would be the first line of attack. The second would be anything designed to boost the potential growth rate. Unfortunately, for now it does not look as though the new government

2006

2007

METI AND JESPER KOLL CALCULATIONS

hat really worries me is that corporate Japan is very focused on leaving Japan: rather than investing here in the world’s secondlargest economy—which is what brings many of us here, right?—Japan Inc. is increasingly focused on investing overseas. The numbers are, well, shocking: overseas investment—Japanese companies buying global companies, or building new factories, logistic hubs, distribution centers, dealerships, etc.—has risen almost threefold over the past three years. Against this, domestic investment is down almost 50%. On company visit after company visit, you discover that almost all corporate growth strategies are focused on investing overseas. In contrast, the domestic strategies almost exclusively focus on managing costs down and trying to streamline operations. All said, the great hollowing out, the deindustrialization of Japan Inc., has become a key dynamic here. In my view, the success or failure of the new government will be measured by its ability to implement policies that help reverse this trend. Japan Inc. leaving Japan is the economic equivalent of a no-confidence vote against the government. A sign of real change would be if the team of Prime Minister Hatoyama can actually get corporate Japan to start reinvesting in Japan. The economics of overseas investment is fairly overwhelming. It is a function of growth potential and costs. On the cost side, the case against producing in Japan is, unfortunately, fairly obvious. The chart and table above illustrates how much of a gap has opened up between domestic and global profitability for Japanese companies. You see that margins of domestic operations are about 2.8%. Against this, margins in all major overseas regions—and these are the margins of Japanese-owned overseas operations—are significantly higher, with Asia basically double at 5.8%, China at 4.9%, and even U.S.-based operations owned by Japan Inc. generating a handsome 4.8%.

team has anything concrete to offer on either front. If anything, the costs of doing business are likely to increase somewhat, due to greater union inﬂuence on labor laws. At the same time, however, the creation of the new National Strategy Bureau, headed by the steadfast Naoto Kan, gives some reason for optimism. Clearly, economic policy must be the centerpiece of any national strategy. Without getting Japan Inc. to reinvest in Japan, grand dreams of building Asian currency zones or restoring ﬁscal health cannot be achieved. Remember that shortly after Prime Minister Koizumi took over, several of Japan’s Fortune 50 electronics giants announced they were building new factories in Japan. Almost instantly, the credibility of the new government started to rise. Let’s hope that Japan’s new regime can also convince big business to reinvest in Japan. In my view, investment behavior by corporate Japan over the next six to 12 months will be Jesper Koll is President and a leading indicator CEO of Tantallon of the new governResearch Japan. ment’s political fortune. ■

Turtle Talk

Japan Open 2009

JGAS 2009

October 1 www.tokyodisneyresort.co.jp/tdr/english/ news/index.html

October 5-11 www.atpworldtour.com/tennis/1/en/tournaments/proﬁle/329.asp

October 6-10 10:00-17:00 (last day: -16:00) www.jgas.jp/eng/about_intro.html

New attraction opens at Tokyo DisneySea inside the S.S. Columbia in the themed port of American Waterfront. In a 200-seat theater during a 12-min show taking place in an undersea laboratory located at the stern, guests can have a “righteous” good time talking and interacting in real-time with Crush, the sea turtle who appeared in the Disney/Pixar ﬁlm, Finding Nemo. Tokyo DisneySea (next to Tokyo Disneyland), Chiba, Urayasu Station, Tozai Line

On the Association of Tennis Professionals (ATP) World Tour, 500 series. Outdoor hard court surface, prize money of $1,226,500. Men’s and Women’s singles and doubles. Ariake Coliseum, Ariake Tennis Forest Park, Tokyo, Kokusaitenjijo Station, Rinkai Line; or Ariake Tennis-no Mori Station, Yurikamome

The purpose of the quadrennial Japan Graphic Arts Show 2009 is to develop and invigorate the latest printing and paper-converting technologies for the graphic arts industries. The previous 2005 Japan show involved 350 exhibitors (including 15 from overseas) that drew 118,418 visitors, of who 3,204 were from 41 countries. Tokyo Big Sight, East 1-6, Odaiba, Tokyo Waterfront, Kokusai-tenjijo Station, Yurikamome

Fuji Television Japanese Grand Prix October 2-4 (2nd) Practice, 10:00-11:30 & 14:00-15:30 (3rd) Practice, 11:00-12:00; Qualifying, 14:00(4th) Race, 14:00www.formula1.com/races/calendar.html The Formula One 2009 official World Championship event (15th in a 17-race season) is at the Suzuka Circuit (owned by Honda Motor). Japan’s first full-fledged racing course (1962) is 5,821m. The race circuit is 53 laps, covering a distance of 308km. Suzuka Circuit, 80km southwest of Nagoya, Mie Prefecture

40 | The Journal | October 2009

10th CEATEC JAPAN 2009 October 6-10 10:00-17:00 (ﬁrst day: exhibition, 12:00-) www.ceatec.com/ The Combined Exhibition of Advanced Technologies divides exhibition area into consumers & businesses; and products & services. Last year, 804 enterprises (including 289 from 27 countries and regions), 3,121 booths, and 196,630 visitors. Makuhari Messe, Chiba, KaihinMakuhari Station, JR Keiyo Line

9th BioFach Japan October 7-9 10:00-17:00 www.biofach-japan.com/main/Page.html “Where organic people meet” is the theme for the International Conference on Sustainable Production, Trade, Consumption and Lifestyle. LOHAS (lifestyle of health and sustainability) remains a growing trend in Japan. Main product interests were in organic food (33%), natural materials and ﬁbers (22), natural cosmetics (21), organic raw materials (17), services (5), and non-organic food (2). Tokyo Big Sight, West 4, Odaiba, Tokyo Waterfront, Kokusai-tenjijo Station, Yurikamome Line

EVENTS LINE-UP

Shuki Taisai Grand Autumn Festival October 17 www.jnto.go.jp/eng/

Japan Pack 2009 October 20-23 10:00-17:00 www.japanpack.jp/en/ According to the Japan Packaging Machinery Manufacturers Association, with $4.12 billion in shipments for 2008, the Japanese market continues on a growth trend. Companies exhibiting at the Japan International Packaging Machinery Show generate approximately 80% (or $3.27 billion) of the production volume of packaging machinery in Japan. Tokyo Big Sight, Odaiba, Tokyo Waterfront, Kokusai-tenjijo Station, Yurikamome Line

RISCON Tokyo Toshogu Shrine, a registered World Heritage Site, is in Nikko, the gateway to the Tohoku region and just 125km north of Tokyo. In the Hyakumono-Zoroe Sennin Gyoretsu (Parade of 1,000 Samurai Warriors), a mikoshi (portable shrine) leads a procession of people dressed in warrior costume and toting weaponry from the Edo Era. The pageant aims to be a reproduction of the funeral ceremony for the First Shogun of Tokugawa, Ieyasu (15421616). Yabusame—a contest combining equestrian skills and kyudo (Japanesestyle archery)—is another highlight.

October 21-23 www.kikikanri.biz/english/ The Security & Trade Expo is a comprehensive exhibition of the latest products and services related to protection, disaster prevention and risk management. Attendance last year reached 57,729. Tokyo Big Sight, West & Conference Tower, Odaiba, Tokyo Waterfront, Kokusai-tenjijo Station, Yurikamome Line

Free admission. Contact: ASG Tax Corporation (Kiyoe Fujisawa & Stephan Forest) 03-5770-8916 or t-asgGROUP@ gtjapan.com. ASG Tax Corporation Seminar room (Aoyama-itchome)

10th ismir 2009 October 26-30 9:00-18:00 http://ismir2009.ismir.net/ The International Society for Music Information Retrieval Conference aims to provide a venue for the exchange of news, ideas and results among the expanding MIR community. There are presentations of original theoretical or practical work, as well as awards for best paper, best student paper and best oral presentation. The conference brings together researchers and developers, educators and librarians, students and professional users. Kobe International Conference Center, Shimin-Hiroba Station, Port Liner Line

Business Seminar October 23, 14:00-18:00 (registration 13:30)

22nd TIFF October 17-25 www.tiff-jp.net/report/ daily_en.php?itemid=938 Established in 1985, the Tokyo International Film Festival is accredited by the International Federation of Film Producers Associations, and aspires to be recognized as among the four best ﬁlm festivals of the world (with Cannes, Venice and Berlin). Roppongi Hills (main events), Tokyo Metro Roppongi Station; other theaters, halls around town

Organized by ASG Tax Corporation, this seminar for companies with foreign affiliates provides the latest on tax and legal practices and other business issues in Japan. The focus of the seminar is how such practices impact on foreignaffiliated companies doing business in Japan. Japan’s tax and legal environment is under constant change and this seminar keeps those involved in finance, accounting and corporate planning—on behalf of foreign affiliated companies— abreast with these changes. For those involved in any aspect of Japanese business, this seminar is not to be missed. Program: • Legal Environment for inbound M&A in Japan — Stanley M. Yukevich, Partner, Morrison & Foerster LLP, Yukako Wagatsuma, Partner, Ito & Mitomi • Director Compensation — Soichi Hirose, Director, ASG Tax Corporation • Transfer Pricing Developments in Japan — Joseph Daniels, Senior Manager, ASG Tax Corporation

22nd IOFT 2009 October 27-29 www.ioft.jp/english/ The International Optical Fair Tokyo has a Boutique Corner dedicated to the world’s most avant-garde and expressive concepts in eyewear. The Eyewear Accessories Zone attracts retailers who aim to differentiate themselves from other shops. The Luxury Collection is a showcase for elegant, top-of-the-line eyewear, including platinum and gold frames, jewel frames and chic brand frames. The IT Solution Zone relates to customer, sales and stock management. The Fukui Zone introduces the latest products, designs and technological developments in frames. Tokyo Big Sight, Odaiba, Tokyo Waterfront, Kokusai-tenjijo Station, David Umeda is Yurikamome Line Senior Editor at Paradigm

October 2009 | The Journal | 41

Early detection enhances the chances for survival. Join the Run for the Cure and help to raise awareness.

2009

The 2009 Run for the Cure ® /Walk for Life is a fun 5K / 10K run or 5K walk around the Imperial Palace. You can organize a team of colleagues, friends or family — even encourage your employees to take part and increase their donations through matching funds.

2009 Run for the Cure Walk for Life

Saturday, October 17 Participation Fee*: Adult

¥5,000

Children

¥2,500

5 year olds and under, Free. * includes 2009 Run for the Cure® T-shirt, pink silicone wristband, bottled water

Win 2 tickets to the Saipan Marathon, courtesy of Delta Air Lines, and a 4-day/3-night stay at the Pacific Islands Club.

Time: 9:00

a.m. – 2:00 p.m. Opening & Closing ceremonies: Hibiya City (near Hibiya Park and the Imperial Hotel)

Course: Around

the Imperial Palace

You can make a difference! Register now at

www.runforthecure.org Organized by the 2009 Run for the Cure®/Walk for Life Committee

udgets may limit business trips, but that means communicating in ways that make your customers feel they’re being better served. It’s easy to simplify the process in your head; but when a crisis arises or the need to communicate the same message across all available channels within a company is an imperative, your effectiveness—and success—hinges on an already existing infrastructure. That’s why seeking IT and telecommunications experts begins before you “think” you need help. As you look at this Special Advertising Section, take the time to become better informed at exactly what is at stake when it comes to optimizing your own systems—and serve your customers better, and deliver more to your stakeholders. You need a system and support that speaks “literally” your language—so you can make informed choices as to what best suits your needs and is the most userfriendly IT and telecommunications network. Another key fundamental consideration is compliance with both regulations and among components. While budgets may limit the extent of improvements, you may ﬁnd that a complete ERP overhaul is in order, and be

surprised at how the bottom line improves to more than compensate for the cost. Yet, for global enterprises—and those companies expanding their business in the region—you require an integrated communications and IT management service provider, who is in good stead with both local carriers and governing authorities. While being savvy about Japan is essential, foreign companies, nonetheless, desire ERP packages that speak and function in terms that are compatible with home office systems. Green is coloring every industry sector as well, and data systems are no exception, especially in the area of energy efficiency. Whether you yourself are in the business of IT and telecommunications services, the need for recruiting qualified staff is as dynamic as the industry itself. Yet, because of this acceleration in technology, you also need to have your employees keep up through training and seminars. In these lean economic times, outsourcing for engineers is another dimension to mastering and maintaining the latest in ERP services and systems. From the user perspective, probably one of the most overlooked IT and telecommunications providers is the quality semiconductor manufacturers, who devote

enormous funding to R&D, as well as to improved, more sophisticated production lines that address the need for greater intricacy, speed and cleanliness. The ACCJ Information, Communications and Technology Committee supports and promotes the expansion and diversification of sales of high-tech goods and services by American companies in Japan. Programs include guest speakers from government, leading technology companies and service providers. In addition, there is an active advocacy component addressing issues such as privacy, telecommunications tariffs, and international standards. In a September 9 presentation by the ACCJ ICT Committee, the current scenario was defined and solutions offered. New companies face many challenges to success including funding, staffing, operations, competition and customer acquisition. On top of that, what if you start a company with a new idea that completely disrupts the existing order? How do you overcome all the obstacles to convince the market that your new model is better? David Umeda Senior Editor, Paradigm

APC Japan, Inc. Address

daVinci Shiba Park B-13F, 2-4-1 Shibakoen, Minato-ku, Tokyo 105-0011

Tel

03-6402-2001

Fax

03-6402-2002

E-mail

jinfo@apcc.com

Web site

Japanese: www.apc.com/jp English: www.apc.com

Year established

April,1996

Staff Size:

140

Company Activities / History APC is a global leader in critical power and cooling services, providing industry-leading products, software and systems for home, office, data center and factoryfloor applications. Backed by the strength, experience and wide network of Schneider Electric’s Critical Power & Cooling Services, APC delivers well-planned, flawlessly installed and maintained solutions throughout their lifecycle. Through our unparalleled commitment to innovation, APC delivers pioneering, energyefficient solutions for critical technology and industrial applications. In 2007, Schneider Electric acquired APC and combined it with MGE UPS Systems to form Schneider Electric’s Critical Power & Cooling Services Business Unit, which recorded 2008 revenue of €2,6 billion (including APC-MGE sales of $3.7 billion) and employed 12,000 people worldwide. APC solutions include uninterruptible power supplies (UPS), precision cooling units, racks, physical security, and design and management software— including APC’s InfraStruXure® architecture, the industry’s most comprehensive integrated power, cooling and management solution. Schneider Electric, with 114,000 employees and operations in 100 countries, achieved sales of €18,3 billion in 2008.

October 2009 | The Journal | 43

IT SERVICES PROVIDERS | Special Section

Staying in Touch

IT SERVICE PROVIDERS Special Section

Business Associates K.K. Address

ORIX Shinagawa Bldg. 4F, 2-5-3 Konan, Minato-ku, Tokyo 108-0075

Tel

03-5715-3315

Fax

03-5715-3318

E-mail

takeshi.saitoh@ba-net.co.jp

Web site

www.ba-net.co.jp/english

Year established

1987

Staff Size:

Contact

Takeshi Saitoh, Representative Director

Company Activities / History Business Associates, founded by Japanese certified public accountants with expertise in IT, accounting and taxation, designs systems that help business grow and empower clientele to achieve their business objectives through proprietary software solutions. Plaza-i is the only ERP package developed by a Japanese company geared for foreign corporations operating in Japan. Unlike imported software with limited application to Japanese business parameters or domestic programs that cannot completely support international operational procedures, Plaza-i remains the only bilingual, multi-currency ERP package—developed for over 20 years—that fully supports foreign corporations here. Plaza-i’s built-in bilingual capability is 100% compliant. Japanese users’ screens operate in the vernacular yet produce reports in English, while foreign staff can work using English commands and menus. Plaza-i comes at a price not inflated by typical fees for imported ERP packages. We provide genuine value for your software investment. Plaza-i’s multi-currency capability—not typical in Japanese ERP packages—supports foreign companies who typically import products from their parent companies. Plaza-i’s aging schedule function and other software features define your ideal single ERP package. Whether entering the Japanese market for the first time or looking for a better and more reasonable ERP system in Japan, you owe it to your staff—and your bottom line—to contact us today.

Cable&Wireless Worldwide Address

East Tower 4F, Otemachi First Square, 1-5-1 Otemachi, Chiyoda-ku, Tokyo 100-0004

Tel

03-5219-1257

Fax

03-5219-1201

E-mail

toshiyuki.sekiya@cw.com

Web site

www.cw.com

Year established

1981

Staff Size:

2,000 across Asia

Contact

Toshiyuki Sekiya, Senior Client Director

Company Activities / History Cable&Wireless Worldwide (formerly referred to as “Europe, Asia & US”) is one of the world’s leading international communications companies, providing business critical telecommunications solutions to the largest users of telecoms services globally. Over the past few years, Cable&Wireless has made strategic investments in Japan to expand its world-class network infrastructure, build on its partnerships and signiﬁcantly grow its portfolio of value-added telecommunications solutions for customers. Investments include enhancements to Cable&Wireless’ Points-of-Presence (PoP) in Osaka, Tokyo and Yokohama. The Osaka PoP is engineered to be physically separate from the other PoPs in Japan, with access to a completely different set of cable systems to connect to Asia and the United States. This enhanced resilience and capacity into and out of Japan is crucial, providing diversity for multi-national companies in the event of natural disasters or sub-sea cable breaks. Cable&Wireless has upgraded its network to a next-generation Multi Service Platform (MSP) in Japan, enhancing the company’s capability to deliver highquality managed IP voice and video solutions. The MSP also allows Cable&Wireless to provide a faster, more resilient global IP network service with enhanced support and predictable, seamless service delivery to its customers. Nick Lambert, Managing Director – Global Markets at Cable&Wireless Worldwide, says: “We’ve been investing for growth throughout Asia for the past two years and are continuing this strategy with our ongoing investments in Japan. Having a strong presence in Japan is an important part of our strategic vision to deliver world-class solutions to our customers and provide a world-class customer experience.

44 | The Journal | October 2009

Address

Otowa Bldg. 3F, 3-11-2 Otsuka , Bunkyo-ku, Tokyo 112-0012

Tel

03-5940-6880

Fax

03-5940-6881

E-mail

info@esolia.co.jp

Web site

www.esolia.com

Year established

1999

Staff Size:

Contact

Rick Cogley, CEO (rick.cogley@esolia.co.jp)

Company Activities / History eSolia is a globally minded Information Technology Management firm providing superior business-centric consulting, project and outsourcing services to a variety of blue-chip foreign and Japanese organizations in Japan and abroad. Our focus is on multi-cultural, multi-language organizational environments, with a vision to consistently provide our clients with just the right mix of helpful goods and services. Founders Rick Cogley and Takumi Fukuoka have been delivering services together from Japan for 16 years. In 2009, we’re pleased to say that our firm eSolia has reached its 10th anniversary with a successful track record in handling complex, high-pressure projects, and providing creative problem-solving for our clients’ challenges. Whether it’s managing a Japan IT Department as an interim CIO or a fully outsourced IT team; providing end-user support directly or over the phone; managing projects coming from mergers, acquisitions, divestitures or joint ventures; or translating a software user interface, we have the confidence to find solutions for all your systems or process challenges. Our concept is simple—our services are always standards-based, unbiased by maker affiliation, built and grown with an awareness of your business and culture, and are delivered by a team of experienced experts who act with the highest standards of ethics, professionalism and integrity. eSolia sows the seeds that help you build a strong foundation for your Japan business success and meet your commitments. Let us begin developing a longterm relationship with you today.

HexCode Technologies K.K. Address

Level 27, Shiroyama Trust Tower, 4-3-1 Toranomon, Minato-ku, Tokyo 105-6027

Tel

813-5404-8183

Fax

81-3-4496-6052

E-mail

sales@hexcodetechnologies.com

Web site

www.hexcodetechnologies.com/assessment

Year established

2007

Staff Size:

Contact

Samudra Dutta Gupta

Company Activities / History This Microsoft Certified Company in Advanced Infrastructure Solutions started with a mission to make systems administration for an enterprise most costeffective. It is offering one-day consulting service to assess companies for their readiness to deploy Vista or Windows7 as their desktop operating system. It also offers one to five days similar assessment services for Windows Server 2008. Other services include Windows XP, Windows Vista, Windows 7 desktop rollout to the entire enterprise including offsite locations at other countries in Europe and the USA, along with other enterprise software like Office, Antivirus, Citrix, Oracle, Adobe, etc. and several Multiple User Interfaces (Japanese, Korean, German, Dutch, etc.). No Ghost-like software used, which allows you to have a minimal amount of core built and maintenance. Our deployment can be rolled out to any unforeseen purchased desktop or server hardware in the future, depending only on availability of device drivers, with the same precision. Similarly, we can deploy Windows 2008 R2 Servers along with Hyper-V virtual machines uniformly across the enterprise, to reduce the number of physical servers for overall cost reduction. The benefit of such deployment lies in the fact that the entire infrastructure becomes uniformly designed. Support becomes extremely cost-effective as any troubleshooting incident can be replicated in any machine irrespective of the hardware and location. Complex software installations will be packaged for a single-click installation, reducing time spent on it for its rectification. Bilingual services are also provided. See from website how it reduced cost and increased efficiency for one company.

October 2009 | The Journal | 45

IT SERVICES PROVIDERS | Special Section

eSolia Inc.

IT SERVICE PROVIDERS Special Section

Inﬁneon Technologies Japan K.K. Address

Gate City Osaki East Tower 21F, 1-11-2 Osaki, Shinagawa-ku Tokyo 141-0032

Tel

03-5745-7100

Fax

03-5745-7410

Web site

www.inﬁneon.com/jp

Year established

1999 (new company name registered)

Staff Size:

163 (as of Sep 2009)

Company Activities / History Infineon Technologies AG, Neubiberg, Germany, offers semiconductor and system solutions addressing three central challenges to modern society: Energy Efficiency, Communications, and Security. Its strategic business focuses are on automotive and industrial electronics, chip card and security applications, as well as applications in communications. Infineon’s products stand out for their reliability, their quality excellence, and their innovative and leading-edge technology in analog and mixed signal, RF and power, as well as embedded control. In the 2008 fiscal year (ending September), the company reported sales of €4.3 billion with approximately 29,100 employees worldwide. With a global presence, Infineon operates through its subsidiaries in the U.S. from Milpitas, CA, in the Asia-Pacific region from Singapore, and in Japan from Tokyo Infineon Technologies Japan, a subsidiary of Infineon Technologies AG, is not only a sales office for the Japan market, but also marketing research and development function for the leading automotive and consumer electronics market. The Japan head office is located in Tokyo, and two strategic sales offices in Osaka and Nagoya.

KVH Co., Ltd. Address

Shin Aoyama Bldg. West, 1-1-1 Minami Aoyama, Minato-ku, Tokyo 107-0062

Tel

03-5772-5818

Fax

03-5772-5685

E-mail

sales@kvh.co.jp

Web site

www.kvh.co.jp

Year established

199

Staff Size:

450

Contact

Tokyo Sales

Company Activities / History KVH was established in Tokyo in 1999 as an Asia-Pacific IT/communications service provider. Through its facility-based optical fiber networks and data centers, KVH offers integrated communications and IT management solutions that include managed services, data networking, Internet access, and voice services to business customers. KVH has a presence in Tokyo, Yokohama, and Osaka (and in Shanghai through its affiliate), and serves over 1,700 corporate customers in broad industry segments including financial services, manufacturing, pharmaceutical, media, and e-commerce.

46 | The Journal | October 2009

MDS GLOBAL

Address

1-5-15-202 Yoyogi, Shibuya-ku, Tokyo 151-0053

Tel

03-3373-7749

Fax

03-3373-7756

E-mail

info@mdsglobal.com

Web site

www.mdsglobal.com

Year established

2001

Staff Size:

Industry sectors:

Finance, Law, Real Estate, IT

Contact:

Mike Stensrud, Managing Director

Company Activities / History MDS Global K.K. is a boutique agency licensed to recruit permanent staff and to provide temporary staff. MDS Global K.K. was established by an IT professional who felt there was a lack of actual IT experience amongst the recruiters who are tasked with helping companies find qualified IT staff in Tokyo. We primarily provide permanent, temporary and contract IT staff, as well as administrative staff, to foreign firms in Tokyo. Our clients include both domestic and international investment banks, asset managers, insurance companies, real estate, law, IT and apparel firms. Our candidates, both Japanese and non-Japanese, come from a variety of backgrounds spanning IT support and infrastructure to development, to project management and management. Many of the candidates are bilingual and almost all of them have previous experience working at foreign firms in Japan. If your firm has a need for IT or administrative staff, or you simply require temporary or contract staff on a short- to medium-term basis, please feel free to contact MDS Global K.K. about your requirements. We’d be glad to help.

TD & Company Limited Address

AIOS Meguro-Ekimae 821, 2-15-19 Kami-Osaki, Shinagawa-ku, Tokyo 141-0021

Tel

03-6410-5227

Fax

03-6410-5227

E-mail

obata@tdac.co.jp

Web site

www.tdac.co.jp

Year established

2000

Staff Size:

Contact

Julien Obata, Sheila Medalla

Company Activities / History TD & Company is a premiere provider of SAP implementation/consulting services in Japan. For the past decade, we have been supporting SAP implementations in Japan for global companies as well as medium-sized businesses. Our matrix of expertise goes from IT project management and functional IT consulting to off-shore development. With our team of bilingual consultants and project managers, attuned to global rollouts and complex international projects, we have gained the trust of a large panel of customers in various industries, helping them to successfully integrate their global IT strategy into the Japanese legal and business environment. We are working in small teams of highly skilled professionals, allowing us to provide our customers the best service at the lowest cost.

October 2009 | The Journal | 47

IT SERVICES PROVIDERS | Special Section

MDS Global K.K.

Digital Dining

In what is claimed to be a Japan first, guests can make restaurant reservations for dining outlets at Shangri-La Hotel, Tokyo through the hotel’s dining Web site (www.shangri-la.jp). The real-time reservation system,

kicked off at the beginning of August, provides instant confirmation of bookings in an e-mail reply. “Consumers can make reservations anytime, 24/7, meaning anyone who has access to the Internet is a potential

user of this service,” says Naomi Tsutsu, communications coordinator at the hotel. The Hong Kong-based Shangri-La Hotels and Resorts currently owns and/or manages 62 hotels under the Shangri-La and Traders brands—handling an inventory of over 28,000 guest rooms. Since entering the Japanese market last year—at a time when the economy had commenced a dramatic downturn—the Shangri-La has striven to differentiate itself from its international competitors. Services tapping into the digital age are sure to appeal to international consumers searching for convenience and ways around the language barrier.

Chinese Expansion Chinese chemical enterprise Jiangsu Longliqi Group Company Ltd. has established a Japanese office and Longliqi Japan Beauty & Health Innovation (R&D) Center in Kobe. Longliqi’s second overseas research center, after one in the U.S., opened in June. Established in 1986 in Suzhou City, Jiangsu Province, roughly a 90-min drive from Shanghai, the company employs more than 30,000 people in China. The five product lines—cosmetics, household cleansers, health foods, furniture, and leather goods—total more than 1,000 manufactured items. Kobe’s association with fashion and its proximity to Port Island—home to the Kobe Medical Industry Development Project,

48 | The Journal | October 2009

a cluster of advanced medical technology firms—factored into Longliqi’s decision to set up its headquarters here. The firm’s R&D center will focus on functional cosmetics that act directly on the cells and genes of human skin and hair, improving their physiological functions. Based on leadingedge dermatology and hair science, the institute aims to create affordable, high-quality, functional cosmetics, combining sophisticated research techniques in Japan with existing production capabilities in China. With sights set on entering the Japan market, Longliqi’s ultimate aim is to create a globally recognized brand.

FDI PORTFOLIO

Uniqlo +J Uniqlo’s collaboration with German fashion designer Jil Sander has been named +J. The much-anticipated collection is set to be as minimalist as the brand name. Fast Retailing Co., Ltd. had to think outside the box, since Japanese fashion competitor Onward Holdings Co., Ltd. owns the designer’s previous fashion house and retains commercial rights to her full name. Launching in the fall/winter season, +J will be retailed at Uniqlo’s flagship stores in major cities and on the Uniqlo e-commerce site. The fashion world has been in a tizzy since the collaboration was announced more than six months ago, marking her much anticipated return to fashion. It had been five years since Sander left her fashion house (Jil Sander) following disagreement with the brand’s then-owner Prada Group over how her brand was being developed and marketed. Sander’s role extends to creative director overseeing Uniqlo’s other apparel and accessories lines for men and women—a

new direction for a brand associated, for the most part, with inexpensively priced, low-cost manufactured dry goods.

Suwa Precision Nagano’s Lake Suwa region is home to a large concentration of manufacturing industries that excel in precision technologies. Last year, some 27,000 visitors from Japan and abroad attended the three-day Suwa Area Industrial Messe trade fair, which featured everything from micro-components to advanced precision technologies used in a number of different industries. In October, JETRO is inviting international companies wishing to procure precision parts to a special meeting area at the show to discuss new business. Some 250 leading manufacturing enterprises from the Suwa region will take part in the 2009 Messe, including in the fields of precision machining; plastics; press

working; die-casting; tooling, molds and machinery; surface treatment; optics; and electric and electronic components. The event—from October 15 to 17—is at Lake Suwa Event Hall in Suwa

City, approximately two hours from JR Shinjuku Station. The area has a long history connected to manufacturing. Over 1,000 enterprises are based in Suwa; and well-known manufacturers such as Seiko, Epson and Olympus emerged out of the innovative labs in Nagano Prefecture. By the 1990s, the region had become an integral provider of product development and manufacturing for computer and electronic components, LCDs, automotive parts, Contact Nicole Fall at nicole@ semiconductor process ﬁvebyﬁfty.com if equipment, and optical you have ideas devices. for this column. www.suwamesse.jp/en/

October 2009 | The Journal | 49

Miyuki Tokunaga CEO, THE PRESENTS CO., LTD. Text and photos by Tony McNicol

ike other entrepreneurs, Miyuki Tokunaga is nothing if not busy. “People think that being independent is the same thing as being free,” says the CEO of Fukuoka-based image-consultant startup The Presents Co. Ltd., “but starting a company is actually about giving up your freedom.” Tokunaga had plenty of time to brace herself for the challenges of entrepreneurship during a successful 20-year career in hotels and human resources. In 2007 she set up her company; and being the only full-time employee, she dispatches 10 contract trainers and image consultants to companies all over Japan. Many have studied the ﬁeld in the U.S., and Tokunaga did so in New York and is accredited by the Association of Image Consultants International. The name “The Presents” is a word play on (business) presentation and the gift of sincere service. Tokunaga’s company offers four main areas of expertise: management consulting, training, careers consulting, and various events, editing and printing services. Her most recent project, from September 2009, is working with a leading training consulting company on ofﬁce layout design. What unites the wide variety of services her company offers, says Tokunaga, is a mission to

50 | The Journal | October 2009

BIOGRAPHY Miyuki Tokunaga ■

Image Consultant, CEO of The Presents Co., Ltd.

■

Raised in: Fukuoka

■

Speaks: Japanese, English

■

Hobbies and interests: Tennis, Movies, a qualified “food analyst”

■

Favorite sayings or quotations: “Where there’s a will, there’s a way”. “Rome wasn’t built in a day.”

give employees “dreams, aspiration and satisfaction” in their working lives. A large part of Tokunaga’s work is helping organizations improve communications among employees and with customers. She says that smaller companies, where everyone knows each other, often manage to get by without special training. But when they reach the size of around 100 people, problems start to crop up, leading to both ﬁnancial loss and needless work. Even worse, “If people can’t communicate within their own company,” says Tokunaga, “what chance do they have of communicating with customers?” She also teaches employees how to navigate the intricate codes of politeness in corporate Japan. “Business manners are the basis of communication,” says Tokunaga. As well as

BUSINESS PROFILE

SNAPSHOT The Presents Co., Ltd. ■ Industry served: Young and expanding companies ■ Key clients: Services, trading, utilities, medical ■ Established: 2007 ■ Number of Staff: 1 + 10-20 trainers ■ Tokyo address: 1-23 Kanda-Nishikicho, Chiyoda-ku, Tokyo 101-0054 ■ Fukuoka address: Tenjin Bldg. +3, 4-8-2 Tenjin, Chuo-ku, Fukuoka 810-0001 ■ Telephone: 03-3259-2833 (Tokyo), 092-600-8495 (Fukuoka) ■ Web: http://the-presents.jp ■ E-mail: m-tokunaga@the-presents.jp

business keigo (polite Japanese involving executives), she teaches how to exchange business cards, bow correctly, and use appropriate body language and eye contact. Recently, she adds, there has been a strong demand for training in the most basic business manners, something she puts down to an egalitarian educational system in Japan that leaves graduates unprepared for a vertically structured business environment. At the same time, rote learning in schools means young employees can struggle to formulate and express their own ideas. Born and bred in Fukuoka, Tokunaga is a passionate advocate for the city that’s home to her new business. Fukuoka is 90 minutes from both Tokyo and Shanghai, so is well placed for business with China and Southeast Asia. Tokunaga’s business has benefited from Fukuoka’s thriving service industries— conference centers, hotels and tourism. Tokunaga, having trained as an image consultant in the U.S., joined the ACCJ to help keep in touch with the U.S. She loves opportunities to work with foreign companies. “I am a producer. I make connections between individuals and companies, and between companies and companies,” she enthuses. In Japan, that could be helping U.S. companies communicate better with their local customers. She also has experience in dealing with Japan’s somewhat conservative regional business environment. “In Tokyo, companies see new things as opportunities,” she says. “In the regions [beyond the capital], they are more concerned with avoiding risk.” Most of the Fukuokan’s career has been in Tokyo. Tokunaga spent over 10 years working in sales, hospitality and service improvement at the prestigious Imperial Hotel. In her thirties, she began to think about branching out on her own and took a job at a human resources training company where she stayed for five years. For all the invaluable experience it provided, it was tough. One year she worked some 362 days. “My work now is pretty easy compared to that,” says Tokunaga. One of relatively few female entrepreneurs in Japan, Tokunaga has been profiled by several Japanese business publications. But she doesn’t believe her gender has been a particular disadvantage in Japan’s male-dominated business world.

“People often ask if it was difﬁcult to start a company as a woman, but I have to say it wasn’t,” she says. At her company’s seminars for female entrepreneurs, Tokunaga tells participants not to think about their gender, but to have “determination, imagination and fun.” That’s something she tries to exemplify in her own working life, although the demands of running a young startup makes a healthy work-life balance a challenge at times. “If I didn’t enjoy my work, I couldn’t do it; but I also have to sleep,” says Tokunaga. “I always try to make sure I am done by 12 a.m., and I always get at least ﬁve hours’ sleep a day. “There is no such thing as a perfect child or Tony McNicol adult in this world,” she adds. “Companies are is a freelance journalist based the same. That is why it is fun to watch in Tokyo. them grow.” ■

October 2009 | The Journal | 51

Advocacy Update ACCJ Viewpoints are the core products of ACCJ Advocacy. An ACCJ Viewpoint is a brief paper, generated by a committee, that expresses the Chamber’s official position on a specific issue. Viewpoints are primarily used to express opinions on current policies, policies under consideration by the Japanese and/or U.S. governments, and policies under discussion in bilateral or multilateral forums. They are also used to raise new concerns about issues not currently on the Japanese government agenda. Ensure the Viability of the Policyholders Protection Corporation

Implement Effective Anti Money Laundering and Counter Terrorist Financing Measures

Insurance Committee

Ensure a Level Playing Field between Regulated Kyosai and FSA-Regulated Insurance Suppliers

Valid Through September 2010

Insurance Committee

Valid Through June 2010

Banking and Finance Committee

Valid Through June 2010

Recommendation The American Chamber of Commerce in Japan (ACCJ) calls on the Government of Japan to: 1) continue improving its mechanisms for promptly treating the causes of life insurance company failure through ensuring accurate and timely disclosure and early intervention procedures by the Financial Services Agency (FSA); and 2) reform the Life Insurance Policyholders Protection Corporation (PPC) from a pre-funded to a post-funded system to ensure that the PPC is used as a last resort, which would benefit consumers through lower costs and increased efficiency. Unfortunately, debate about moving to a postfunded system was not held (at the Financial System Council or elsewhere) before the current system was extended for three years beginning April 2009. Such debate should occur promptly to ensure that a low-cost and efficient safety net system is fully in place by the time current measures expire in March 2012. The ACCJ requests that all interested parties, including the insurance industry (both domestic and foreign), are provided meaningful opportunities to be informed of, comment on, and exchange views on proposed measures related to the PPC prior to their implementation and/or submission to the Diet. These opportunities must include actively contributing to the deliberations on reforming the PPC, including deliberations undertaken by the Financial System Council’s Insurance Working Group as well as other groups which might be convened by the Government of Japan to address PPC reforms.

Recommendation Recommendation The American Chamber of Commerce in Japan (ACCJ) calls on the Government of Japan to create a level regulatory playing field between insurance suppliers regulated by the Financial Services Agency (FSA) and “regulated” kyosai (mutual aid cooperatives that provide insurance products and are regulated by ministries or agencies other than the FSA). Under Japan’s international trade commitments, the Government of Japan has a responsibility to ensure that regulated kyosai are subject to the same rules and regulations as foreign insurance suppliers. Until FSA-regulated foreign and other insurance suppliers and regulated kyosai receive equivalent treatment under Japan’s laws and regulations, the Government of Japan should prohibit any insurance business expansion (e.g., new or revised products) by regulated kyosai. To ensure a level playing field, all regulated kyosai that compete with FSA-regulated insurance suppliers should be brought under FSA supervision under the Insurance Business Law (IBL). Doing so would help ensure equivalent conditions of competition with FSA-regulated insurance suppliers and enhance the welfare of Japanese consumers by requiring regulated kyosai, for example, to: 1) contribute to a safety net system to protect policyholders from potential failures; 2) follow the same rules and regulations as FSA-regulated insurance suppliers, including the same reserving and market conduct rules; 3) submit to FSA supervision consistent with globally accepted standards in accordance with the International Association of Insurance Supervisors’ “Insurance Core Principles and Methodology;” and 4) be subject to the same taxes as their FSA-regulated competitors. As a first step toward achieving equivalent conditions of competition, the ACCJ urges the Government of Japan to conduct a thorough review of the rules and regulations governing the supervision and inspection of regulated kyosai to determine their conformity with FSA standards of supervision for FSA-regulated insurance suppliers.

The American Chamber of Commerce in Japan (ACCJ) urges the Financial Services Agency (FSA) and the Government of Japan (GOJ) to issue a multi-agency response to the Financial Action Task Force (FATF) 2008 mutual evaluation of Japan’s anti money laundering (AML) and counter terrorist financing measures. The ACCJ applauds the GOJ’s current review of its AML and counter terrorist financing measures and urges the implementation of new measures consistent with internationally accepted standards. The ACCJ strongly recommends that the GOJ focus on the following elements to meet the 2010 FATF re-evaluation and improve Japan’s standing as a major global financial center, specifically: • Utilize global case studies of AML legal and control structures in establishing substantive new measures; • Consider the actual implications of new measures on business and avoid impeding commercial transactions unreasonably, with a view toward minimizing the administrative burden on financial institutions and making the requirements consistent with those of other jurisdictions; • Allow time for the careful consideration of the actual costs of implementing new measures that may arise from enacted legislation or newly established regulation; • Eliminate current conflicts existing between the Act on Prevention of Transfer of Criminal Proceeds and the Act on Protection of Personal Information; • Develop “know your customer” (KYC) and “customer due diligence” (CDD) guidelines consistent with those of other jurisdictions; • Adopt appropriate risk-based AML / KYC measures and controls for the various industries in Japan, in line with those adopted in developed markets such as the European Union, the United States, Singapore and Australia. ° The appropriateness of the measures should be based on the type of business being operated. Bank transactions, which have the potential for higher risk, need more thorough AML / KYC measures. Fund transfers, which have less inherent risk, need less AML / KYC measures because there is no cash in the system (i.e., deposits). ° Requirements for AML / KYC measures should generally be set by industry, as is the practice in other developed economies that provide for a risk-based approach where, for example, faceto-face meetings are not always required and electronic forms of confirmation are permissible.

Released ACCJ Viewpoints can be read in full in the Advocacy section of www.accj.or.jp 52 | The Journal | October 2009

ACCJの「意見書」は、特定の問題に対してのACCJの公式見解を表明する委員会が作成した簡潔な提言書であり、提言活動の中核を成しています。現行の政策や、日本又は米国政府で検討中の政策、二国間もしくは多国間で協議中の政策についてだけでなく、新たな関心を高めるために現在日本政府の課題となっていない問題についても意見を述べています。

保険契約者保護機構の適正な見直

制度共済と金融庁規制下の保険業

効果的な資金洗浄・テロ資金供与

しを

者の間に平等な競争環境の確立を

対策の実施

保険委員会

銀行・金融委員会

2010年9月まで有効英語正文

2010年6月まで有効英語正文

提言

在日米国商工会議所（ACCJ）は日本政府に対し、（1）正確

在日米国商工会議所（ACCJ）は日本政府に対し、金融庁以外

在日米国商工会議所（ACCJ）は、金融活動作業部会（FATF）

かつタイムリーなディスクロージャーおよび金融庁による早

の省庁の規制下にあって保険商品を提供する制度共済（相互

の資金洗浄・テロ資金供与対策に関する2008年対日相互審

期介入制度を通じて、生命保険会社の破綻につながりかね

扶助組織である協同組合）と、金融庁規制下の保険業者との

査への対応案を、複数機関共同で発表することを金融庁およ

ない要因を早期に解決する制度を引き続き改善すること、そ

間に規制面で平等な競争環境を確立するよう要請する。日本

び日本政府に対して要請する。

して（2）生命保険業界のセーフティーネットである保険契約

政府は国際通商上の日本の責務に従い、制度共済を外資系

ACCJは、資金洗浄・テロ資金供与対策に対する日本政

者保護機構（保護機構）を事前積立方式から事後拠出方式

保険業者と同じ規制下に置くべきである。外資系を含む民間

府の現状審査（レビュー）を評価しており、国際的に受け入

保険競合者が日本の法制下で平等な扱いを受けるようになる

れられている基準と一致する新たな対策（措置）を実施する

まで、制度共済による新商品や既存商品の改定といった保険

ことを要請する。日本政府が2010年のFATF再審査を満た

事業拡大を禁止すべきである。

し、日本の地位を主要な国際金融センターと同水準まで改

平等な競争環境を確立するために、すべての制度共済は、

善するために、ACCJは以下の要素に焦点を置くことを提言

金融庁の規制下にある保険業者と競合する範囲内におい

する。

て金融庁の規制下に置かれ、保険業法が適用されるべきで

• 現実的な新しい対策（措置）を確立するために、資金洗

ある。例えば、以下のような措置を制度共済に義務づけるこ

浄対策（AML）の法規制や管理構造に関するグローバ

に変更し、保護機構があくまでも最終手段として利用されることによって、消費者がコスト低下、効率性の向上を通じて恩恵を受けられるようにすることを要請する。 2009年4月以降の制度延長に向けた金融審の審議においては、事後拠出方式への移行に関する具体的な議論は行われていない。政府はこうした議論を早急に開始し、低コストで効率的なセーフティーネットが、現在とられている対策が期限切れとなる2012年3月までに完全に構築されるよう対応すべきである。ACCJは、国会への法案提出および法令施行の前に、（国内・外資系企業を含む）保険業界を含むすべての利害関係者が保護機構について提示される対策案について十分な情報を与えられること、意見を述べ、また意見を交換する実質的な機会を与えられることを要請する。これ

とにより、制度共済と金融庁規制下にある保険サービス提

ルな事例を活用する。

供者との平等な競争条件の確保および日本の消費者の福

• 金融機関に対する管理上の負荷を最小限にするため、お

利促進がもたらされるだろう。1）破綻が起きた際に契約者

よび他の管轄と要件の一貫性を持たせるために、新対策

を保護するため、セーフティネットへ資金を拠出すること、

（措置）のビジネスへの実質的な影響を考慮し、商取引

2）準備金積立規制や市場行動ルール等、金融庁規制下の

を不合理に妨げることを避ける。

• 法律の制定または新しい規制の設定に伴う対策（措置）を

には、金融審議会の保険の基本問題に関するワーキング・グ

保険業者に適用されるのと同じルール・規制が適用される

ループや日本政府により保護機構の改革について招集され

こと、3）国際的に受け入れられている保険監督者国際機構

実行するために必要な実質的コストを十分に考慮する。

る他の会合があればそこで行われる議論等、保護機構改革

（IAIS）の「保険コア・プリンシプル（保険監督基本原則）」に

• 犯罪による収益の移転防止に関する法律と個人情報の

についての議論に参加する機会が含まれる。

定められている保険サービス提供者の監督基準に則った金

保護に関する法律の間で現在見られる矛盾を取り除く。

金融庁規制下の競合者と

• 他の管轄地域と同水準の「顧客確認」（KYC）と「顧客

平等な競争条件の確立に向けた第一歩として、ACCJは

• EUや米国、シンガポール、オーストラリア等の先進国と同

日本政府に対し、金融庁以外の省庁が監督・検査を行って

様に、適切なリスク・ベースのAML/KYC対策（措置）お

いる制度共済に対する法規制が、民間保険業者に対する金

よび統制を、日本国内の様々な分野において採用する。

融庁の監督基準と適合しているかを徹底的に見直すことを

° 対策（措置）の適切性は、業務タイプに基づいて判断

融庁の監督下に置かれること、 4) 同じ水準の税金を負担すること。

要請する。

管理」（CDD）のガイドラインを策定する。

されるべきである。より高い潜在的リスクのある銀行業務は、より徹底的なAML/KYC対策（措置）が必要となる。一方、内在するリスクが少ない送金業務は、現金を扱わない（預金等）ため、より低いAML/KYC対策（措置）となる。

° リスク・ベース・アプローチを採用している他の先進国の慣習に習い、通常、AML/KYC対策の要件は、業種ごとに設定されるべきである。例えば、本人確認のための対面式面談が常に求められる必要はなく、電子的な形式での確認が許容されるべきである。

ACCJが公表した意見書の全文は、www.accj.or.jp の政策提言活動のページでご覧頂けます。 October 2009 | The Journal | 53

Advocacy Update ACCJ-Nippon Keidanren Joint Statement calling for a U.S.-Japan Economic Partnership Agreement

日本経済団体連合会・在日米国商工会議所（ACCJ）

Joint Statement

共同声明

In light of the need for initiatives to overcome the recent global financial turmoil and economic downturn, the American Chamber of Commerce in Japan (ACCJ) and the Japan Business Federation (Nippon Keidanren) Committee on U.S. Affairs call for the redoubling of efforts to deepen and strengthen the cooperation between and joint leadership by two of the world’s largest economies as a way to improve the business environment, increase the competitiveness of our respective economies and stimulate long-term growth. Our two nations share many values and our economies are at similar stages of economic development, which gives us greater potential to cooperate than ever before. Towards this end, the Nippon Keidanren and the ACCJ call for the establishment of a bilateral “Japan-U.S. Strategic Economic Forum” between the two governments as a means to discuss long-term, strategic issues vital to our economic relationship. Within such a framework, it is essential to have sustained, high-level support from both governments to set strategic economic priorities and provide political impetus. Regular meetings between Cabinet-level officials can add depth and direction, sustain momentum, and guide work at lower levels. The two governments should work with a near-term focus on a number of key initiatives aimed at solving business environment problems that impede trade and investment between both countries and restrict their competitiveness relative to the rest of the world. These initiatives may include, but would not be limited to, harmonization of intellectual property rights and patent systems, further liberalization of government procurement, facilitating distribution and customs procedures, harmonization and/or mutual recognition of the U.S. Customs-Trade Partnership Against Terrorism (C-TPAT) and the Japanese customs’ Authorized Economic Operator (AEO) program, simplification of visa and consular affairs, enhancement of Japan-U.S. cooperation on environmental technology, commencement of a government dialogue on the joint promotion of the internet economy, and harmonization of local/state and national/federal regulations in both countries. Both organizations believe that cooperative efforts will be essential in this pursuit and, if successful, could lead the two countries to more actively pursue a comprehensive, high-level Economic Partnership Agreement (EPA), as an effective and enduring way to deepen bilateral economic relations and strengthen the overall competitiveness of the U.S. and Japanese economies. Working toward this ambitious goal would build further momentum in the U.S.-Japan economic relationship and lay the foundation for an active, forward-looking bilateral economic agenda. We envision an EPA as an “FTA-Plus” agreement that would encompass “substantially all the trade” in goods as well as “substantial sectoral coverage” in services, as required under WTO rules, and address tariff and non-tariff measures in areas including, but not limited to, regulations and regulatory transparency, distribution, harmonization of standards, commercial laws, investment rules, capital and currency markets, agriculture, trade remedies such as antidumping, competition policy, human resources and movement of natural persons, intellectual property, and secure trade. We believe that negotiation of a U.S.-Japan EPA could also serve as a model for a broader regional agreement among like-minded countries and provide impetus for further progress in multilateral negotiations. The upcoming Asia-Pacific Economic Cooperation (APEC) conferences in 2010 and 2011 will provide excellent opportunities for Japan and the U.S. to fully utilize their respective leadership roles to promote sustainable growth in the region. We endorse the U.S. and the Japanese governments’ support for APEC’s efforts to accelerate trans-Pacific economic integration. Indeed, such an agreement could boost both countries’ competitiveness in Asia and globally by enabling the U.S. and Japan to take the lead in establishing the regulatory framework that will serve as a key element of the emerging trade and economic architecture in a dynamic Asia-Pacific region. We also remain supportive of multilateral negotiations at the WTO, as we believe the aforementioned initiatives could help bring about an early conclusion of the Doha Round. We acknowledge the challenges inherent in promoting trade in the midst of a global economic slowdown and rising unemployment levels, which have led to increased nationalistic and protectionist sentiment around the world. Increased trade, while bringing tremendous benefits to companies and consumers alike, can result in dislocation in certain areas due to greater competition. We recognize the need to establish robust systems in both countries to help workers, companies and communities better adjust to rapid changes in the marketplace and succeed in the increasingly global economy. Such efforts are required to build a strong consensus among key stakeholders and broad public support for promoting free trade on both a bilateral and more global basis.

54 | The Journal | October 2009

共同声明 ̶ 日米EPAの強化に向けて

英語正文

現下のグローバルな金融・経済危機の克服に向けた取組みの必要性に鑑み、日本経団連アメリカ委員会と在日米国商工会議所（ＡＣＣＪ）は、両国のビジネス環境を改善し、競争力を強化し、長期的な経済成長を促進するため、二大経済大国である日米間の協力を強化・深化すべく両国政府が一層努力することを求める。日米両国は、多くの価値観を共有し、同じような経済発展段階にあることから、我々には協力を強化しうる多くの潜在的可能性がある。そのような目的に向けて、経団連とＡＣＣＪは、日米経済関係にとって重要な長期的・戦略的課題について取り上げる両国政府間の「戦略経済対話」の設置が必要と考える。そのような枠組みで、両国の経済課題における戦略的優先順位を決定し、政治的な支持を得るためには、両国政府のハイレベルで持続的な支援が必要である。閣僚メンバーによる定期的な会合の開催は、実務レベルでの作業に方向性と深みを与え、はずみをつけることに役立つ。両国政府は、両国間の貿易投資を阻害し、両国の競争力を制限しているビジネス環境上の当面の課題に解決をもたらす幾つかの重要なイニシアティブに焦点を当てて、取組むべきである。それらには、以下のようなものが含まれるが、これらが全てではない。・特許システムのハーモナイゼーションの促進・政府調達のさらなる自由化推進・日本のＡＥＯ制度と米国のC-TPATの相互承認を含むサプライチェーンにおける安全確保と物流の円滑化・効率化の両立・ビザ・領事事項の円滑化、簡素化・環境技術における日米産業協力の強化・米国における連邦と州の規制、日本における国と地方の規制のハーモナイゼーション促進・日米政府間のインターネット・エコノミーの推進に関する対話の開始経団連とＡＣＣＪは、上記のようなイニシアティブにおいては日米協力が不可欠であり、もしそれらの取組みが成功すれば、日米経済関係を強化し両国経済の全体的競争力を強化するための効果的で持続的な手段として、日米両国が、包括的でハイレベルな経済連携協定（ＥＰＡ）をより積極的に追求することに繋がると考える。日米ＥＰＡという野心的な目標に向けて努力することは、日米経済関係にさらにはずみをつけ、積極的で前向きな二国間の経済アジェンダの形成にも寄与する。我々は、日米ＥＰＡを「ＦＴＡプラス」の協定として、ＷＴＯルールに基づき、「実質的に全ての貿易」及び「実質的に全てのサービス分野」を含むものと考える。日米ＥＰＡでは、関税に加え、法規制とその透明性、物流、基準・認証、商法、投資ルール、資本・為替市場、農業、アンチ・ダンピングなどの貿易救済措置、競争政策、人的資源とヒトの移動、知的財産権、セキュア・トレードなどを含む非関税措置が対象になる。我々は、日米ＥＰＡ交渉は、今後、同様の志を持つ国々の間で検討される広域地域協定のモデルともなり、多国間交渉の進展にもはずみをつけるものとなると考える。 2010年には日本、2011年には米国がＡＰＥＣの議長国を務めることは、日米両国が議長国としての役割を利用してアジア太平洋地域の持続的成長を促進する絶好の機会となる。我々は、日米両国政府が、環太平洋経済統合を加速するためＡＰＥＣの取組みを支援していることを支持する。そのような合意は、ダイナミックなアジア太平洋地域で、新たに生まれつつある貿易・経済枠組みの主要な構成要素となる規制の枠組み構築において、日米両国がリーダーシップを発揮することを可能とし、アジア、そして世界における日米両国の競争力を高めることに繋がる。我々は、また、以上のような取組みは、ドーハ・ラウンドの早期妥結にも寄与するものであることから、世界貿易機関（ＷＴＯ）における多角的交渉を引き続き支持する。我々は、世界的不況と失業率の高まりにより、世界に愛国的、保護主義的な感情が高まっている中で、貿易を促進することの課題を認識している。貿易の増加は、企業や消費者に膨大な利益をもたらすと同時に、競争が高まる特定の分野においては混乱をもたらす。我々は、両国の労働者や企業、地域社会が市場の迅速な変化に対応し、益々グローバル化する経済において成功することを支援するための強固なシステムを日米で構築する必要があることを認識している。そのような努力は、日米二国間で、またよりグローバルなレベルで、自由貿易を推進することに対する主要なステークホルダー間の強力な合意を形成し、広範な国民の支持を得るためにも求められる。

BEHIND THE BOOK

The Ramen King and I: How the Inventor of Instant Noodles Fixed My Love Life By Andy Raskin Gotham Books, 293 pp, $26 Reviewed by Tom Baker At the Tokyo Toy Show this summer, the front wall of the Happinet pavilion housed a display of Nissin Cup Noodle containers, including one more than two meters tall. Employees of Happinet, part of the Bandai Namco Group, stood in front of it demonstrating a soon-to-be-released Cup Noodle toy. Inside the cup were squiggly plastic noodles that comprised a tiny jigsaw puzzle. If the player failed to fit them together inside the cup in under three minutes—the time it takes a serving of real Cup Noodles to cook once hot water has been added—a timer would send the pieces flying. If this toy had been released a few years earlier, Andy Raskin might have considered it a sign. Raskin, an American journalist who often covered Japan-related business topics, developed an obsession with instant ramen after reading about Nissin founder Momofuku Ando’s 1958 invention of it in Nikkei Business magazine in 2004. At the time, Raskin was recuperating from a gallbladder operation in Tokyo that was necessitated (he implies) by an overly fatty bowl of non-instant ramen. Despite his business success, Ando had an often difficult life, including brutal imprisonment during World War II. He refused to eat the unappealing prison rations at first, but changed his mind after seeing that other inmates eagerly partook. “I felt that I had glimpsed the true nature of humanity at a very deep level

… In order to survive, humans must change their thinking,” Ando later wrote in one of his many books. Living in better times, Raskin’s main difﬁculty in life was a kind of emotional starvation related to his persistent inability to be faithful to any woman with whom he became romantically involved. When he joined a support group for people with this kind of compulsion and his sponsor asked him, essentially, to name a higher power he could trust, Raskin blurted out, “Momofuku Ando.” The Ramen King and I is a memoir of how Raskin tried to apply Ando’s many proverb-like quotes to his personal life and eventually set out on a quixotic quest to meet the great man in person. While this may not be a “business book” in the very strictest sense of the term, it does contain interesting Japanese business lore—most, but not all of it, from Ando’s life and writings. There are also scenes from Raskin’s friendship with Zen Ohashi, a Japanese “management coach” and business author whose quirky career advice is based on such criteria as the speed with which you put on your underwear in the morning. (It’s supposed to indicate the type of day you expect to have.) Raskin’s near-deiﬁcation of Ando doesn’t seem so odd in light of his account of the noodlemaker’s 2007 funeral at Kyocera Dome in Osaka. One of the ceremony’s themes was sending Ando, who was born under Halley’s comet, back to outer space to watch over us. One can only hope Tom Baker is that, as he looks down from that great noodle a staff writer cup in the sky, he is well pleased with Raskin’s at The Daily unusual tribute. ■ Yomiuri. We are giving away 3 copies of The Ramen King and I. Simply e-mail editor@paradigm.co.jp by October 20. The winners will be picked at random. Winners of The Venturesome Economy: Patrick Nwadike, Afro Initiative, Japan; Jeffrey Char, J-Seed Ventures, Inc.; A.J. MacKinnon, Nuance Communications Japan KK.

October 2009 | The Journal | 55

IN THE FINAL ANALYSIS

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Integrity, a passion for excellence, commitment and clemency

t’s been a year since the Lehman collapse and a lot has changed. It’s been a month since the Japanese lower house election and it looks like even more will change. And the ACCJ has been and will continue to be in the middle of these changes. Many of our committees have held programs to help our members understand emerging trends and policy directions. EAAC and GRC leaders have been working with other leaders and members to design advocacy approaches that will best move our Core Advocacy Principles forward. And preparations for the 2009 Diet Doorknock are underway. In past Doorknocks we have been careful to cultivate Diet members from all major parties. Seven key DPJ members met with us last year and two key DPJ policy makers, including Okada-sensei, addressed the Chamber recently on issues of interest. So we are confident that our brand is well recognized among the new leaders in Nagatacho. There’s good news to report. Ambassador John Roos has accepted our invitation to serve as Honorary President of the Chamber. Many of our members have already had the chance to meet with Ambassador Roos and I am sure many more of you will be meeting him soon. He promises to be an enthusiastic supporter of the Chamber and is eager to get involved. Those of us who have spoken with the Ambassador have been very impressed. Not only is he a close confidant of President Obama, but he is also familiar with all the legal and financial intricacies of doing business in a sophisticated international marketplace. I am sure our entrepreneurial members will be particularly interested in meeting and talking with him about their experience in Japan. There will be tremendous demands on his time and attention this fall, but I have no doubt that the ACCJ will be one of his primary sources for information and analysis. We’re good at that kind of thing. Unfortunately, there is also sad news to report. Robert L. Sharp, ACCJ President in 1984, passed away recently in California. Bob was President just as the trade frictions of the 1980s were beginning to take hold. In his remarks at the Inaugural Ball 25 years ago, Bob spoke with eloquence about the need for “patience, wisdom and firmness” in our dealings with Japan. Bob’s leadership is an excellent example of how our member leaders play a key role in setting the tone as well as the practical contents of the relationship between the United States and Japan. And while we are grateful to Bob for his service to the ACCJ, it is also important to recognize his broader service to overall bilateral ties. After leaving Japan, Bob became very active in the Japan America Society of Southern California, serving as a member of the Society’s Board of Directors for over two decades. At Bob’s invitation, I had the pleasure of attending a Society dinner held on the infield at Dodger Stadium with welcoming addresses by Ambassador Kato and Ambassador Baker on the big screen, Tommy Lasorda at the mike, Samuel H. George Takei across the table. Thank you so much, Kidder is Bob. You’ll be missed by many. ■ ACCJ Executive Director.