EURObiZ Japan December 2010

Recipe for success Le Creuset Japon

Monica Pinto Le Creuset Japon

ALSO INSIDE //

Choosing Japan Reasons to resist the lure of China

The right staff

Q&A with Tempstaff founder and president Yoshiko Shinohara

12

2010

THE MAGAZINE OF THE EUROPEAN BUSINESS COUNCIL IN JAPAN / THE EUROPEAN (EU) CHAMBER OF COMMERCE IN JAPAN

8 FOCUS 8 Choosing Japan Reasons to resist the lure of China

By Julian Ryall

12 Baulk buying Japan “welcomes” rich Chinese shoppers

By David McNeill

18 M&A Chinese mergers and acquisitions activity on the rise

By Martin Foster

CHAMBER SPOTLIGHT 2

December 2010

22 The Norwegian Chamber of Commerce in Japan’s membership offers everything from salmon for sushi to software for games consoles.

16

58 64

24

Cover photograph Benjamin Parks

COLUMNS 7 From the Editor 16 Q&A Justin McCurry talks to Tempstaff president and founder, Yoshiko Shinohara, the only Japanese national selected for FORTUNE magazine’s international list of the most powerful women in business.

21 Executive Notes

28 In Committee

41 Who’s Who Directory

A medical device gap deprives Japanese patients of the latest care, reports the EBC Medical Devices Committee.

By Geoff Botting.

Business Travel in Japan

31 Green Biz Luke Poliszcuk’s company, eQualC, helps companies communicate their green achievements and goals. By Tony McNicol.

58 Talking EURObiZ Marko Saarelainen is the head of Honka Japan, importers of Finnish log houses.

He talks to Justin McCurry.

60 Lens Flair Miguel Rodriguez photographs some of Tokyo’s spectacular Christmas illuminations.

Asia must set aside rivalry to ensure peace and prosperity, writes Dan Slater of the Economist Corporate Network.

32 Industry Experts Business Intelligence

63 Upcoming Events

24 Investing in Japan

37 Event Report

Europe and Japan business-related events.

Monica Pinto of Le Creuset Japon has a recipe for success, hears David McNeill.

26 Holiday Dining & Bonenkai Gift Guide

David Chevalier struts his stuff at the Italian Chamber Disco.

38 Culture Shock Rob Gilhooly meets the only non-Japanese sake master-brewer, Philip Harper.

64 Work Place Alexis Gresoviac is managing director of Gameloft K.K.

The Mission of the European Business Council To promote an impediment-free environment for European business in Japan.

December 2010

3

Publisher Vickie Paradise Green

European Business Council in Japan (EBC)

paradise@paradigm.co.jp

The European (EU) Chamber of Commerce in Japan

Editor-in-chief Tony McNicol

The EBC is the trade policy arm of the seventeen European national chamber of commerce and business associations in Japan

tonymcnicol@paradigm.co.jp

Senior Editor David Umeda Creative Director Richard Grehan

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The views and opinions expressed herein (other than editorials by the EBC ) are solely the opinions and views of their authors. The EBC is not responsible or liable for any portions thereof.

Martin Foster reports on M&A activity in Japan, page 18

Martin is a Tokyo-based freelance reporter writing mainly about business and finance, with an occasional foray into general news.

His work has appeared in Institutional Investor, The Wall Street Journal Asia, the Justin McCurry is the Tokyo correspondent for The Guardian and The Observer newspapers in London. He also reports on Japan for Global Post and The Christian Science Monitor, and contributes to the The Lancet medical journal and several other publications in Japan and the UK. He spent several years working as a copy editor and reporter for the The Daily Yomiuri in Osaka before joining the The Guardian full time in 2003.

“Given wooden homes’ obvious aesthetic appeal and low carbon footprint compared

David Chevalier trips the light fantastico at the Italian disco, page 37 Born in the United States and raised in the Philippines, David came to Japan two

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International Herald Tribune and The Guardian.

“Much has been made of the fact that Japan with a population of approximately 130m has been supplanted as the number two global economy by a country of 1.3bn.

Part of the story is the mathematics of vastly larger numbers of Chinese spending more than the Japanese, but the real issue for Japan is the lack of original homegrown solutions and unwillingness to accept change. The way forward could be very hard for those unable to accept the new reality of a vibrant China.”

Justin McCurry meets Marko Saarelainen of Honka Homes, page 58 with other building materials, perhaps, as Marko suggests, the time has come for Japanese regulatory authorities and housing companies to take them more seriously?”

years ago to study communications at an international university in Tokyo. For the past decade David has been composing and recording music. He is currently working on instrumental scores for independent and student filmmakers in Japan.

“This was probably the first nightclub I’ve been to where they were handing out chocolates on the dance floor.”

F rom the E ditor

Animal spirits These last few weeks, we have seen the worst of East Asia: territorial disputes, nationalist posturing, trade obstruction and now bloody confrontation on the Korean peninsula.

Yet, the region has also hosted two key economic forums: the G20 in Seoul and APEC in Yokohama. We can only hope politicians can protect the region’s political and economic stability. As Dan Slater points out in his column this month (page 21), economic integration is a tool Asian leaders can use to mitigate the danger of disastrous political or, heaven help us, military confrontation.

That’s why it was heartening to hear trade liberalisation on the Japanese government’s agenda. In recent weeks ministers have expressed interest in

NEXT MONTH

3 Going for growth

trade agreements between Japan and various regions, including parts of Asia and the EU. Time will tell if those words are put into action.

But in the meantime, this magazine presents evidence of a kind of economic integration that’s already with us – Japan and China’s ever more interdependent economic relationship.

We have two stories on Chinese money in Japan: David McNeill’s report on how rich Chinese are shopping for bargains in Japanese consumer goods, real estate and medical treatment (page 12); and Martin Foster’s story on an increase in Chinese M&A activity (page 18).

Yet, while acknowledging China’s dynamism and importance, we focus too on Japan’s considerable attractions as a business location. Julian Ryall

The 2010 EBC White Paper

points out some economic sectors of great potential (page 8). As he puts it, “there is still something very comforting in tried-and-tested Japan”. (For a concrete example of how Japan’s opportunities have been successfully tapped, see David McNeill’s profile of Le Creuset Japon (page 24).

Lastly, how could I not mention the truly unforgettable event I attended for this issue – the Italian Chamber of Commerce disco? David Chevalier writes about that on page 37.

Tony McNicol Editor-in-Chief

tonymcnicol@paradigm.co.jp

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Choosing

Japan

Reasons to resist the lure of China

Damon Coulter

Text Julian Ryall

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December 2010

F ocus

T

And while China is undoubtedly an attractive and potentially vast market, there is still something very comforting in tried-and-tested Japan, many executives believe. It is now up to organisations such as the Japan External Trade Organization (JETRO) to identify areas where more improvements might be made. That, they believe, will attract new companies looking to have a presence in the Far East and keep others that are considering moving to China here in Japan.

Great potential “The population of Japan has been declining since 2005,” said Tadayuki Nagashima, director-general of JETRO’s Invest Japan department. “But the market is still huge and there are several areas with great potential.”

These include healthcare, new and renewable energy, tourism, aircraft, electronics and automobiles, particularly next-generation vehicles, he said.

In June, the government released a paper titled “Japan’s New Growth Strategy” that calls for the elimination of barriers to the flow of people, goods and capital both within Japan Starting a Business Country

Doing Business 2011 Report, June 2009-May 2010, The World Bank

he recent global recession has rattled the world’s economic system, but for China it seemed little more than a bump in the road. Annual GDP growth in 2010 is expected to nudge 9% and given the colossal consumer base and an increasing number of people with an income that is burning holes in their pockets, China should be a corporation’s dream destination.

But firms should be careful what they wish for. The old adage about “the devil you know” can also be applied to national markets.

“Many European and American companies – particularly technology ones – remain nervous and sceptical about targeting China as a market, opting instead to focus their resources on Japan,” said Greg Sutch, CEO of Oxford-based Intralink, which specialises in bringing together American and European technology firms with clients and partners both here and in China.

Sutch said Intralink’s operations in China are “growing, but with some difficulty,” citing a litany of hurdles that are far less of an issue in Japan.

There are the well-known problems surrounding the protection of intellectual property rights, Sutch says, ticking off the key areas of concern on his fingers. There is also a lack of truly global Chinese brands and a reluctance on the part of Chinese companies to adhere to international business practices or business models, such as when it comes to making “up-front” payments in the form of licence fees or “non-recurring engineering costs” for technology or software that the foreign firm is, naturally, expected to cover.

There is also the problem of proprietary standards, particularly in the telecom and broadcast sectors, which would require foreign companies to develop China-only products in order to enter the market, as well as the stated policy of the central government to favour Chinese companies over foreign ones for public-sector contracts.

Rank

New Zealand

1

Australia

2

Canada

3

Singapore

4

Macedonia, FYR

5

Japan

98

China

151

Ease of Doing Business Country

Rank

Singapore

1

Hong Kong

2

New Zealand

3

UK

4

US

5

South Korea

16

Japan

18

China

79

While China is undoubtedly an attractive and potentially vast market, there is still something very comforting in triedand-tested Japan and across the world and promises to “aggressively pursue emphatic domestic reforms with the goal of doubling the flow of people, goods and capital into Japan.”

The organisation has had some notable successes in recent years, with Swedish interior furnishings giant IKEA now operating five stores in Japan, Spain’s Inditex Group – the company behind the Zara brand of clothing – opening around 50 stores across the country and Austrian firm Red Bull putting their energy drinks in convenience stores.

Other European arrivals include Hennes & Mauritz, the Swedish apparel company better known as H&M; Italian interior goods brand Alessi; German robotics experts KUKA, which opened a technical centre in Odaiba in 2009; and French advertising experts the JCDecaux Group.

“It is both easy as well as difficult to do business in Japan,” said the regional head of a major European company with operations in both Japan and China, but who preferred to not be named. “The easy part about operating in Japan is the reliability of the systems, the adherence to safety and so on. It is also much easier if you seek to locally make products that are formulated according to Japanese regulations.”

For his company, gaining access to China’s potential market has been the largest stumbling block.

“Often this is secured via partnerships and I believe that Chinese partners are December 2010

9

FOCUS

According to the World Bank’s recent study on the ease of doing business, China ranked 151 out of 183 economies for ease of starting a business far from ideal in terms of staying within contracts or, more importantly, staying within principles of integrity,” he said.

Other firms have expressed similar concerns.

“The Chinese way of doing business is a little different from that of many of the other markets we have entered,” said David Swan, managing director of recruitment firm Robert Walters Japan and Korea. He was heavily involved in setting up the company’s first Beijing office, scheduled to open before the end of 2010.

“Business dealings in this country can sometimes be a bit tricky and oftentimes it is a little challenging getting companies to follow through with commitments.

“Some companies we have spoken with have told us of their challenges when doing business in China,” he added. “One of the major examples seems to centre on the issue of intellectual property. This concern is most prevalent for those businesses in the IT and financial services industries where IP protection is of integral importance for their products.”

Different challenges Japan and China are both challenging markets in their own ways, Swan said.

“The demand from many of the Japanese firms we work with is the desire for slow and steady growth,” he pointed out. “Many of these companies are well-established, so their goal is to maximise efficiencies where possible.

Chinese executives, on the other hand, are under pressure to guide their businesses to rapid growth and expansion.”

European firms do have a strong presence in China, companies such as

Volkswagen, Nokia and Airbus having become household names in the country, according to Dirk Moens, secretary-general of the European Union Chamber of Commerce in China. But some are rethinking their positions.

“It is true that recently, market access restrictions and the slow pace of regulatory reform have forced companies to reassess their operations in China,” Moens told EURObiZ. “At the moment, the benefits of having a base in China still outweigh the difficulties, especially in terms of access to the domestic market. Yet, while some companies would like to enter the Chinese market or expand their operations there, they hesitate due to licensing problems or other administrative obstacles.”

Citing the example of the computer reservation systems sector, Moens said China has yet to meet its commitments to the World Trade Organization (WTO) in terms of market access and national treatment. While the necessary approval process described in the relevant Chinese General Agreement on Trade in Services commitments simply does not exist at present.

According to the World Bank’s recent study on the ease of doing business, China ranked 151 out of 183 economies for ease of starting a business, which Moens described as “a disappointing result for the world’s second-largest economy.”

In its annual position paper, the chamber, which represents more than 1,300 member companies, examined market access barriers to European firms, highlighting in particular compulsory certification and licensing schemes that restrict market access and are in breach of WTO commitments.

“The Chinese government goes beyond this and sometimes relies on compulsory certification schemes to regulate its large and growing market,” said Moens. “Such practice unduly restricts access to the Chinese market for European companies in a range of key industries, such as the automotive, auto component, IT and telecommunications equipment, healthcare equipment, electro-technical and power transmission industries.

“In some respects, China does accommodate foreign businesses; the infrastructure is good – if increasingly strained – and for some sectors in some areas incentives exist to attract FDI,” he added.

“On the other hand, as the World Bank assessment suggests, China still has a long way to go towards giving foreign companies a level playing field with their Chinese competitors, especially in terms of its regulatory regime and the access to the market.”

There is also one other factor that needs to be taken into account for the expatriate executive, according to the senior official who declined to be named. The safety and well-being of his or her family.

“Life as an expat manager is much, much better in Japan than in China,” he said. “I always say this is a really hard place to work, but a great place to live.”

Do you have an opinion on this topic you’d like to share?

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December 2010

11

Baulk buying Japan “welcomes” rich Chinese shoppers

Text David McNeill Photos Rob Gilhooly

A

ngry Hinomaruwaving protestors may regularly descend on Tokyo’s Moto-Azabu neighbourhood to shout abuse at the Chinese Embassy. But for another picture of Sino-Japanese relations, try the upscale Matsuzakaya department store a couple of miles away in Ginza.

So many Chinese tourists visit this crusty shopping landmark that the store recently had to hire Mandarinspeaking staff. “They turn their noses up at Chinese-made goods,” explains Le Hui, one of the new assistants. “They want Japanese and European brands.”

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December 2010

On some days, 10% of Matsuzakaya’s clients are Chinese, and many are not short on spending power. “There are these special edition jewel-encrusted Rolex watches that retail for ¥1.3m; we sell an average of three a month,” says Le. “I’ve seen Chinese customers come in and buy them all in one go – with cash.”

The same wide-eyed story is repeated at many of Tokyo’s largest retailers, including Bic Camera, Mitsukoshi and Chinese electric goods retailer Laox, which opened a branch inside Matsuzakaya in November.

Two decades ago, another Asian power was making hyperbolic headlines: Remember the infamous 1989 Newsweek cover story about Japan’s

“invasion” of Hollywood, following Sony’s takeover of Columbia Pictures?

“We are virtually at the mercy of the Japanese,” blared the Los Angeles Times the same year. Now it’s faltering Japan’s turn to tremble at the power of foreign capital – this time Chinese.

In a 24-page feature in March, the right-leaning Sapio magazine sounded the alarm bells, warning that China is about to “buy up Japan”. Chinese conglomerates are gobbling up real estate, forests and even eyeing uninhabited islands around Japan’s coast, said the editors. Another magazine ran a frontpage story titled: “Your next boss could be Chinese”.

Signs of the growing economic clout of the rising Asian star are all around.

FOCUS

I’ve seen Chinese customers come in and buy them all in one go – with cash Le Hui, Ginza shop assistant

Once heavily sponsored by prosperous Australians, Hokkaido’s Niseko ski resort now has a new group of patrons.

“There has been an absolutely huge shift toward China and Hong Kong,” says David Misfeld, a spokesman for Hokkaido Tracks, which sells holidays and manages properties in the area.

“We see that region of the world as our main focus of future business.”

Since a property crash in 2008 saw many Westerners pull out of Niseko, Chinese are now the resort’s main investors, according to the propertymanagement arm of Hokkaido Tracks.

About 80% of the interest in property there is now from Chinese buyers around Asia. Three $1.5 to $2m properties from the company’s newest

Some Ginza department stores have hired Mandarin-speaking staff

upscale development have gone to investors from Singapore, Malaysia and Hong Kong, says Julian Bailey, a British sales director at the firm.

All this comes at a time of painful

national soul-searching. China this year overtook Japan as the world’s number two economy (in market dollar terms) – a position Japan had held for four decades. Tokyo announced second-quarter figures in August putting the value of its economy at roughly $1.28 trillion, just behind China’s $1.33 trillion.

Two decades of often bitter disputes over history, territory and politics have failed to block the onward march of bilateral economic progress: China has overtaken the United States to become Japan’s most important trading partner, and bought a record 19% of Japan’s total exports last year. Japan in turn purchased 22% of its imports from China, according to the Japan External Trade Organization.

December 2010

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FOCUS

Hokkaido’s Niseko ski resort now has a new group of patrons

Chinese are now ski resort Niseko’s main investors

It will take something very large to stop this bilateral juggernaut, says Zhu Jianrong, a Chinese native and professor of international relations at Tokyo’s Toyo Gakuen University. “For China to continue along its path of development, it needs a peaceful environment and a good relationship with Japan.”

Like the United States in the 1980s, however, Japan is struggling to adapt to its changed circumstances. On the one hand, thousands of businesses struggling with inert domestic demand around the country are turning their gaze to this alluring new customer.

A typically enterprising effort in depressed Osaka pulls together local retailers, transport companies and hospitals in a bid to grab a slice of the medical tourism market.

Nankai Electric Railway has teamed up with two local hospitals, Tominaga and Kishiwada, known for their skills in brain and heart surgery respectively.

Medical packages for rich Chinese tourists also include outings to the Osaka branch of Takashimaya, local hot springs and golf clubs.

But some Japanese, particularly nationalists, are uncomfortable adapting to growing Chinese might,

especially when it bumps up against sensitive local assets. Conservative publications have honed in on the scenic area around Lake Kawaguchi, close to national icon Mount Fuji, where Chinese investors this year snapped up 17 luxury houses. Chinese buyers are also pushing up the price of prized – and symbolic – carp in Ojiya, Niigata prefecture, the center of the country’s ornamental carp business.

Even mainstream publications such as The Nikkei are airing speculation (unproven) that Chinese money is hoovering up Japanese land as a hedge against future food shortages back home. Local councils in Hokkaido reportedly have been asking for voluntary limits on foreign investments since local trophy properties, including the Yamada Hot Springs Hotel in Kutchan, began passing into Chinese hands.

Chinese guests The timing of the September maritime spat in the Senkaku (Japan) or Daiyou (China) islands confirmed some Japanese fears that China’s expanding economic clout is increasingly matched by political and military muscle. One ominous route for frustrations was on

display after the release of the Chinese captain arrested in that spat, an event greeted with fury by Japanese neoconservatives.

The Yukan Fuji tabloid newspaper branded the release dogeza gaiko – appeasement diplomacy. Tokyo’s rightwing governor, Shintaro Ishihara, called the Chinese “gangsters” and said it was time for Japan to seriously consider developing nuclear weapons. One former Japanese general even floated the possibility of war.

That’s hardly likely. But businesses are bracing nervously for the impact.

Cancellation of a single tour group to hotels like the Tominoko near Mount Fuji, where more than 30% of the guests are Chinese, would cost about ¥20m to ¥25m, according to The Nikkei.

Ginza’s Matsuzakaya has already noted a sharp downturn of over 50% since the dispute erupted. “But I don’t think it will last,” says Le. “Chinese shoppers like Japan too much.”

Do you have an opinion on this topic you’d like to share?

Please post comments at www.eurobiz.jp or send them to eurobiz@paradigm.co.jp

December 2010

15

The right staff

Justin McCurry talks to Yoshiko Shinohara, the founder of human resources firm, Tempstaff Photo Jeremy Sutton-Hibbert

As a successful businesswoman in a country of few female entrepreneurs, Yoshiko Shinohara already stands out. But the 76-year-old founder of Tempstaff, which provides human resources services, is making an impact beyond Japan’s shores. This year she ranked 37th on FORTUNE magazine’s international list of the 50 most powerful women in business, the only Japanese national selected.

Why did you decide to start a temping firm?

Lots of things were going on in my life at the time. I had just got divorced and wanted to do something different. I ended up going to the UK and Switzerland for about three years to learn English and improve my secretarial skills. I returned to Japan for a short time and then went to Australia, where I worked for a small company.

That’s when I really became aware of temping agencies.

I launched Tempstaff in 1973 and at first I worked alone out of a tiny room in Roppongi. The room was an employment agency during the day and an English conversation school in the evening. I was lucky to get off to such a good start. Lots of foreign firms, including United States investment banks, were moving into Japan at the time and they liked the fact that I could speak a little English. It wasn’t long before they were asking me to provide more temp staff.

Employment agencies were almost unheard of in Japan at that time, so what obstacles did you face?

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December 2010

We encountered lots of legal problems, because temping by private companies was illegal. The labour ministry often complained. The norm then was for lifetime employment, and we were seen to be challenging that, but the law was changed soon after.

Tempstaff grew as we took on more, mainly foreign clients. I employed about seven women, but I was so busy concentrating on building the company that about 10 years had passed before I had the time to stop and think about how far I had come. Gradually, we added Japanese trading companies to our list of clients and then, in the mid-1980s, firms from other sectors.

How have you been affected by changes in the Japanese economy?

The changing structure of the economy has fuelled our development. The lifetime employment system is weaker, and more companies are now looking for people to perform specific tasks on a short-term basis. They need different kinds of people with a range of skills, and the old employment system wasn’t flexible enough to cater to that.

Would you agree that those changes have also added to job insecurity, particularly among contract staff?

I agree that it’s had good and bad consequences. It has had a bad effect on foreign contract workers who were brought in to perform blue-collar jobs in the 1980s. When the economy is booming it works well for them and their employers, but when there’s a downturn of the kind we’ve seen recently, not only do those workers lose their jobs, they lose their accommodation too.

On the other hand, the number of people seeking work through temp agencies has risen, particularly among women, who make up 80% of our clients.

Why have so few Japanese women repeated your success in business?

There are strong historical and cultural reasons for that. Japan has traditionally been a patriarchal society. That is changing, of course, and now that there are more women in the workplace at all levels, I would like to see more of them in senior positions.

Japan lags behind Europe and the

Q&A

Executives above a certain age are still reluctant to deal with foreigners on the same terms they do their Japanese staff United States in childcare facilities for working women. And the expectation that women will quit their jobs for good when they have children is also a factor in Japan. If attitudes change – and I think they’re already changing – I have no doubt that there will be more female CEOs. When I launched Tempstaff, I definitely experienced discrimination because I’m a woman. I’m encouraged by the fact that that’s no longer the case, and that men’s roles are changing too. More women are pursuing careers, and their husbands are playing a bigger part in childrearing. That can only be a good thing.

That will continue as Japan begins to embrace new work practices such as flexitime, although working from home will still be a problem because of the small size of Japanese homes. Taking paternity leave will be fashionable for a while, and then retreat a little, but ultimately it will establish itself as the norm.

How about Japan’s attitude towards foreign workers?

Here again we are witnessing positive changes, such as the hiring of nurses from South-East Asia to work in nursing care. But there is still a little of the

isolationist mentality in Japan, which perpetuates resistance to outsiders.

One of the problems is generational.

Executives above a certain age are still reluctant to deal with foreigners on the same terms they do their Japanese staff.

Communication, or the lack of it, is also a perennial issue.

You have presided over a successful company for many years now. Do you ever think that it’s time to retire?

I haven’t given it serious thought, but that day will come, inevitably. For now I am concentrating on my business.

I get to the office at 8am every day, read the newspapers and look at what I have in store for the day.

There’s still so much to do. Our group employs about 5,000 people full-time, we have offices in other parts of Asia, and work with partners in Europe and the United States. We are focusing more attention on outsourcing, first in Japan and China. It’s safe to say that we’re going to see a lot more outsourced call and data centres in the future.

December 2010

17

M&A

Chinese mergers and acquisitions activity on the rise Text Martin Foster

T

o read the entries on the Japanese-language blog “FX trader-na ore,” which roughly translates as “Me, the FX trader”, you might believe the Mongol hordes have finally made it across the Straits of Tsushima after having failed some 730 years ago.

One anonymous commenter asks testily: “Are we going to stand around and watch while the Chinese use the fraudulently inflated yuan to buy up Japanese companies?”

There is no denying that Chinese mergers and acquisitions (M&As) activity is on the rise worldwide.

China has been the second biggest acquirer of offshore companies for 2009 and 2010 to November 4, after first entering the top 10 in 2007 and overtaking the UK in 2009 to take second 18

December 2010

I don’t see any need for concern about potentially aggressive moves Steven Thomas, UBS Securities Japan

place behind the United States, according to data from Dealogic, an investment advisory. Chinese companies had acquired 21 Japanese companies as of 11 October 2010, compared with 19 for

the whole of 2009, which in turn was almost fives times the number of firms bought in 2008.

Still, compared to the 44 Japanese companies bought by United States companies from January to October 2010, Chinese companies are just beginning to make inroads into Japan, and are a long way from buying up the crown jewels of Japan’s corporate assets.

FOCUS “There has been a change, from very, very little activity to some activity,” says Steven Thomas, managing director and co-head of M&A at UBS Securities Japan. “I don’t see any need for concern about potentially aggressive moves.”

The majority of UBS’s Japan-based M&A business remains outgoing, and deals where Chinese companies buy capital in Japanese firms tend to be friendly and follow a typical pattern, he says.

Japanese firms see the promise of selling to the Chinese market, but also acknowledge that they do not have the resources and reach. The Chinese player has the reverse set of issues, i.e., access, but no product or technology. (It’s a tactic familiar to the many European companies that have entered the Japanese market in a similar fashion.)

Take Japanese apparel maker Renown.

In July 2010 the company issued $44m of new shares to Shandong Ruyi Science & Technology Group, a Shandong province-based textile company, to give the Chinese textile firm a 41% stake in its partner.

Renown already has access to brand and fashion know-how, and will now gain access to cheap, high-quality raw materials, along with the Shandong Ruyi sales network. The latter will allow it to target a generation of newly wealthy Chinese, according to Hiroshi Yamanouchi, general manager in the legal and investor relations department at Renown.

The deal saw three Chinese directors join the board of Renown, even while Tokyo retains control of the company,

and there are plans to open 2,000 Renown outlets in China.

“It was necessary for us to rapidly expand our business in China, and using Ruyi’s business resources is important to achieve that aim,” Yamanouchi says.

“One of the merits of this deal is that it has allowed us to rapidly expand profits while reducing product costs.”

Global M&A volume by target nation (announced)

Number of Japanese companies acquired by Chinese companies (announced)

Rank

Deal value ($m)

US

1

623,160

UK

2

143,692

China

3

138,297

Brazil

4

128,251

Canada

5

122,032

Japan

6

78,542

Australia

7

74,675

Spain

8

66,696

France

9

65,405

India

10

56,552

21 19

6

6 4

Dealogic

Dealogic

Target Nationality

Off par Tokyo-based Honma Golf was less lucky.

In February 2010, a controlling stake in the company was sold to Marlion Holdings, a Chinese majority-owned company registered in the British Virgin Islands.

“Honma is no longer the force it was in Japan,” says Thomas of UBS, who is a keen golfer. “Japanese golf is a very technology-driven market, where everyone wants a bit of science, but Honma sells a very high-end product, more of a prestige item – and very, very expensive.” Now those high-end products are best-sellers that fit with China’s new rich, says Thomas.

While some Japanese are sure to be agitated by China’s increasing economic influence, foreign observers might see some poetic justice as they remember bubble-era Japan’s spending spree in the United States. Purchases such as the Rockefeller Center and the Pebble Beach golf resort provoked similar apoplexy.

But faced with a shrinking domestic market and cash-strapped consumers, the only way forward for many Japanese companies is to hire managers from their most promising overseas markets,

2

2

1

4

1

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

relations with China remain underdeveloped, especially compared to those with Europe Hideo Kumano, Dai-ichi Life Research Institute and in many cases that means China.

On their own, deals involving China are unlikely to reinvigorate Japan’s moribund economy, observers say. But they can create jobs in a country where much manufacturing has gone offshore, and help expand the business horizons of idea-challenged Japanese companies.

In any case, Japan may have no choice but to accept its new status as a producer of premium goods for the Chinese market.

Hideo Kumano, chief economist at Dai-ichi Life Research Institute, suggests that relations with China remain underdeveloped, especially compared to those with Europe.

The cultural and historical backdrop to relations between China and Japan is complicated – to put it mildly – and has been aggravated in recent years by incidents such as contaminated-food scares and the recent brouhaha over islands in the East China Sea. “When problems occur in Europe, we reconcile our interests and move forward,” he says, “but with China it always seems to be a case of two steps forward and one step back.”

December 2010

19

EXECUTIVE NOTES

With great power comes great

responsibility

Can Asia achieve peace and prosperity through economic integration?

As I write this, the G20 meeting is under way in Seoul and APEC members will gather soon in Yokohama.

I hope you are not yawning. The last resolution to the worst economic crisis until this one, resulted in WWII. So any forum to prevent conflict (whether it be over currencies, hot wars or cold wars) should be taken very seriously.

Indeed, Asia can be described as a 19th-century region in a 21st-century world. While Western countries (with the obvious exception of the United States) have abandoned claims to Great Power status, Asia has several countries that dream of becoming a Great Power. For those with short memories, or who paid insufficient attention to history lessons at school, Great Powers are countries that want to influence the global agenda.

A key characteristic of a Great Power is the willingness to kill many, many people and to suffer very many casualties to achieve its aims. Thus, Britain went to war for every year of the 19th century bar one, in pursuit of its self-appointed role as global hegemon. Britain, France and Germany all accepted paying the Great Power price of millions of casualties in WWI. This is inconceivable today. Europe has given up any pretence of being a Great Power. Indeed, that is the only way a common, European sovereignty like the European Union could be forged.

Great Powers naturally never merge with other powers. They conquer them, or are conquered.

Today, Asia has many similarities to Europe in 1914, but fortunately also many differences.

First, let’s look at the similarities. For a start, Asia has four countries that have not yet signed peace treaties: North Korea with South Korea; and Japan with Russia. Next, you have China, India, South Korea, Russia and Japan interested – admittedly not to the same degree – in setting the Asian agenda, if not the global agenda.

Japan would like to be respected, and as a trading power has an interest in secure sea-lanes. However, it is happy to rely on the United States, and anyway, domestic opposition to casualties is extremely high.

China is the big beast of the region, and clearly sees itself as a Great Power. China is not there yet, but it does want to set the Asian agenda. Every official utterance China makes reminds its neighbours that China intends to live up to its status as the second-biggest economy in the world.

This is understandable. China is extremely worried about its sea-lanes. Four-fifths of China’s oil comes through the narrow Strait of Malacca. Also, China’s growth since the 1980s has been inextricably linked with the Pacific Ocean. China’s port cities have boomed, from Shenzhen to Tianjin, via Shanghai, Xiamen and a dozen others. It is of legitimate concern to China that a string of islands down its southern coasts could be used against

Asia can be described as a 19th century region in a 21st century world its shipping, were they to be occupied by a hostile power.

Now for the differences. South-East Asia is not eastern Europe, where Russia and Austria (and ultimately the rest of Europe) were dragged into nasty wars based on ethnic and religious hatreds. South-East Asia, which has some similarities to eastern Europe in terms of its ethnic mix and economic fragmentation, is profoundly different politically. Countries in the region prize stability, and are pro-business and progrowth. They are smart enough not to lean too far towards the Japan-United States camp, or to the China camp. They act as a stabiliser, not as an irritant.

Beneath these rivalries, the economic benefit of closer integration is clear. If one looks at car parts, it’s clear that European integration has provided a massive boost to this key industrial component. Intra-European trade in car parts was worth $700bn in 2008, while EU-United States trade amounted to $184bn.

In Asia, the picture is reversed, with Asia-United States trade amounting to $184bn, while intra-Asia trade is just $36bn.

National rivalries and non-tariff barriers are holding Asia back.

Can the G20 help reverse this trend, and push the region towards peace and integration?

The agenda is clearly dominated by the search for a resolution to the current economic crisis. Many of the attendees have Great Power pretensions, which will make the question of who gives in to whom rather sensitive.

It’s hard to see China allowing any immediate breakthrough, either in terms of setting a cap on its current account (the United States’s idea) or of revaluing the yuan. China’s pride has been stung by the Diaoyu/Senkaku quarrel, as well as by anti-Chinese sentiment in the United States. One suspects that whatever happens at the G20 meeting in Seoul, it will be driven by a Great Power rivalry. One can only hope these tensions are contained by considerations of global peace and prosperity.

Dan Slater Dan Slater is director of the Economist Corporate Network (www.corporatenetwork.com) in Tokyo, and you can reach him at danslater@economist.com.

December 2010

21

Norwegian Chamber of Commerce in Japan Bjørn Eirik Østbakken/Innovation Norway

c/o Royal Norwegian Embassy, 5-12-2 Minami Azabu, Minato-ku, Tokyo 106-0047 Tel: 03-3440-9935 Email: contact@nccj.or.jp

www.nccj.or.jp

BOARD OF DIRECTORS President:

Trond Varlid, Tomra Japan Ltd.

Vice President:

May Martinsen

Executive Director:

Michal Louis Berg

Treasurer:

Rune Nordgaard, Hydro Precision Tubing K.K.

Directors:

Hiroyuki Date, Elkem Japan K.K.

Noriyoshi Sekine, Nippon Do Tech K.K.

Richard Corwin, Gard P&I

Christian Moen, Atilika K.K.

Keita Koido, Hallvard Leroy A.S.

Svend Haakon Kristensen, Innovation Norway

The Norwegian Opera & Ballet

Warming to Norway “Compared to people of other Scandinavian nations, Norwegians tend to be more individualistic and opportunistic in the way they do business,” says Trond Varlid, president of the Norwegian Chamber of Commerce in Japan (NCCJ).

“When they see a major opportunity, they go for it.”

Since its inception in 2003, the chamber has striven to be “the most important organisation for Norwegian-Japanese business people in Japan,” says the NCCJ website. Working out of the Norwegian embassy, the chamber has around 50 organisations and individuals on its books, the majority of whom are corporate members.

ICELAND A wide variety of industries are represented in the chamber, Reykjavik

and its membership includes many business-to-business firms in industrial production and the shipping industry.

“We are always looking to grow the membership and there are other Norwegian businesses out there that we have the potential to work with,” says Varlid. The NCCJ also cooperates closely with other Nordic chambers.

The Norway-Japan economic relationship took off after

FINLAND

RUSSIA

Oslo

LATVIA

SWEDEN DENMARK

LITHUANIA

L-R: Trond Varlid, NCCJ President, and Michal Louis Berg, NCCJ Executive Director

RUSSIA

Minsk

BELARUS 22

December 2010 NETHERLANDS

POLAND

Kie

C hamber S potlight

Elkem has been serving Japanese industry since 1928

WWII when Japan was energetically rebuilding and growing, he explains.

“Historically, shipping has been one of the big traditional industries in Norway,” says Varlid. “Our Norwegian companies are some of the biggest ship owners worldwide.” John Fredriksen, which has one of the world’s largest oil tanker fleets, is just one example.

Det Norske Veritas, another big name in shipping-related industry here, conducts vessel certification throughout Japan (in addition to other certification services). NCCJ member Petroleum Geo-Services specialises in geological surveys using ships with sophisticated sonar equipment.

Norway offers expertise in other areas, too. “If you look at exports to Japan from Norway, seafood has topped the list for as long as I can remember,” says Varlid. “One of the interesting things that Norway and Japan have in common is that they share seafood as a major industry and as a major preoccupation of consumers.”

Michal Louis Berg, NCCJ Executive Director, says: “Norwegian salmon has, over a number of years, acquired a premium position in the Japanese sushi market. Traditionally sushi did not include salmon, but Norwegian salmon can be eaten fresh and raw – and has changed the preference for salmon in sushi in Japan.

“In Norway we are trying to get away from the focus on Vikings and all these traditional things that have been

written about for so long,” says Varlid.

“One of the things Norway is trying to do as a country is to promote more of our new companies and industries.”

Helping with that is Innovation Norway, the commercial arm of the Norwegian embassy, and also an NCCJ member.

One success story that Varlid identifies among up-and-coming Norwegian companies is Opera Software. Best known for its eponymous web browser, Opera has established itself in Japan as a vendor of innovative software products both for the web and for mobile devices.

Renewable energy is another Norwegian forte. According to a Norway Export publication, Norway is the leading producer of hydroelectric power in Europe, and its solar power industry alone employs 2,000 to 3,000 people.

Some of Norway’s renewable energy technologies are still too new to be commercially viable on a large scale, says Varlid, but he notes that the Japanese solar market is very sophisticated and well established. One advantage for Norwegian firms coming to Japan is that they can cooperate with companies doing similar work, generally at a very advanced level. “It could be a big market for select products,” says Varlid.

When asked about the future for Norwegian business in Japan, Varlid

A Tomra Japan reverse vending machine

One of the first things that comes up in a conversation about Norway with Japanese people is how cold it is. That’s an image the chamber, and especially the Norwegian tourist ???????? ?????? ??????? industry, is trying to change Trond Varlid points out that, while Norway exports a lot of raw materials, there might be greater opportunities for selling more finished and value-added goods.

And it’s not all work for the Norwegians. Like other chambers, the NCCJ has a regular monthly schedule of events. In addition to business focussed events – often at the embassy’s memorably named Arctic Hall – it also holds informal monthly gatherings called Norwegian Club Evenings at izakayastyle restaurants around Tokyo.

“One of the first things that comes up in a conversation about Norway with Japanese people is how cold it is,” he says. “That’s an image the chamber, and especially the Norwegian tourist industry, is trying to change.”

But it certainly hasn’t stopped Japanese tourists visiting each winter to experience Norway’s renowned northern lights. “The Japanese spend longer on holiday in Norway than in any other Scandinavian country,” notes Varlid.

December 2010

23

Recipe for success Le Creuset Japon Text David McNeill Photo Benjamin Parks

T

he standard script for managers of foreign companies in Japan goes something like this: Tread carefully and avoid playing the aggressive gaijin, quietly build the business and avoid disrupting harmony with staff, wholesalers and customers.

That is a script ignored by Monica Pinto, Asia managing director of cookware maker Le Creuset. Arriving to run the French company’s Tokyo office five years ago, the Brazilian native found it “a total mess”, largely caused, she diagnosed, by disorganisation and slavish adherence to the status quo.

“The people who worked here were very Japanese,” she said during an interview with EURObiZ Japan in her Tokyo office. “They were extremely passionate, dedicated to the company, working crazy hours; people to be proud of. But the company had given clear instructions in Japan about how to develop, and the staff was totally resistant.”

Pinto made it her mission to overcome that inertia, shaking up the local office in a way that she admits “created chaos”. One of her first moves was to triple the number of products (stockkeeping units) for sale in Japan, where Le Creuset was known as a luxury, limited product. “I just opened the group catalogue and said: ‘I want this, this and this.’ My staff thought I was going to destroy the brand.

“They said, ‘We don’t have display space,” which is true. But I said, ‘What comes first, the product or the display?’

24

December 2010

One day I heard them talking so I asked them what was wrong. They said: ‘In Japan, you have to worry about the continuity of the brand.’ I said: ‘Listen guys, this is your country, your culture and your opinion is very important. But it is my decision, is that clear? Do what I tell you, or you’re not staying.’ ” Her idiosyncratic management style didn’t end there. Faced with what she calls a cultural reluctance in her office to “make decisions”, she came up with a novel remedy: chocolate. “I had at one point 17 people queuing at my door to tell them what to do, so I said, ‘Look, every time you bring me a problem, you must give me your suggestion for a solution. And I had chocolate balls on my desk to give them. It became a joke, but it showed them what they could do by themselves.”

Some of her surgery has been more radical. Under her leadership, Le Creuset has opened 16 dedicated outlets in Japan, risking friction with the high-end department stores like Takashimaya that used to exclusively stock its products.

“I’m no magician,” she admits. “But there was a market for cookware that clearly wasn’t being properly explored.”

The results, she says, “speak for themselves.” Japan is Le Creuset’s second-best global performer for sales, and its most profitable worldwide. With Pinto at the helm, the company has quadrupled sales since 2004. Le Creuset Japon, which first began selling wholesale here 19 years ago is that rarest of things: a genuine post-bubble success story. Not surprisingly, perhaps, some have dubbed her The Carlos Ghosn of Kitchenware.

Growth like that doesn’t come

The latest initiative may be the most radical yet: cutting out wholesalers and selling directly to department stores without friction. Despite the chocolate balls, many of her original team have quit. Of the 17 people working for the company in 2005, just four are left; tellingly, she calls them “soldiers”. In their place, there has been a huge expansion: Le Creuset Tokyo now employs 150 people.

Its latest initiative may be the most radical yet: cutting out wholesalers and selling directly to department stores.

Don’t bet on Pinto failing.

“We’re making history, because no kitchenware product goes direct to the stores,” she says. “But it takes a huge amount of determination and energy – everyone says it’s too difficult. We will get it done! I’m very linear. What matters is putting the product in front of consumers.

“The truth is that Japan is reluctant to change,” she continues. “But this is the best consumer market in the world.

They’re educated, they’re not impulsive, they search carefully, they know what they want and they become loyal.”

Her husband, who is the company’s finance director, has joined her in Tokyo. “We get along very well, and he always cooks,” she quips. Does he use Le Creuset in the kitchen? “Of course.”

I nvesting I n J apan

Le Creuset Japon 3 Global HQ is in Fresnoy-le-Grand, France 3 Established in Japan 1999 3 Worldwide approximately 1,400 staff; in Japan 150 3 Most successful product is cocotte ronde (round oven) www.lecreuset.co.jp

December 2010

25

Holiday Dining & Bonenkai Grand Hyatt Tokyo

NOBU

“Share the Joy” during Christmas 2010

Tokyo’s Welcome Gift Please ask for the “EURObiZ Champagne gift” when making your reservation (not for bar-only). Valid from 1 Nov. to 20 Dec. for up to 6 guests each reservation.

Meet Chef Nobu in person during dinnertime!

17-19 Dec., Fri-Sun Grand Hyatt Tokyo introduces “Share the Joy”, a charity program with activities to share happiness and joy. “Angel Hour” in the lobby will serve complimentary mulled wine, and an “Angel Photo Studio” has a photographer to take photos of guests by the grand Christmas Tree. A charity dinner produced by Executive Chef Baehner is available, while hampers using Alaffia baskets will be on sale. Part of the proceeds will be donated to “Save the Children”.

NOBU Tokyo Tel. 03-5733-0070 www.nobutokyo.com PHOTO Cristian BarnetT

BiCE TOKYO

Tokyo American Club

Deck the Halls — Put your own merry mark on tradition this festive season by hosting an unforgettable holiday gathering at Tokyo American Club, replete with delicious American cuisine, plentiful drinks and a warm ambience.

Stress-free packages for any style and budget are available through Friday, December 24, and with 2011 banqueting reservations now being taken for our impressive new Azabudai facilities, there is more than one good reason to contact our party-planning experts.

Tel: 03-4588-0977 E-mail: banquet@tac-club.org 4-25-46 Takanawa, Minato-ku Tokyo 108-0074

26

December 2010

BiCE TOKYO in Caretta Shiodome has been for the last 15 years in Japan one of the best restaurants in town.

Located just minutes away from the fashionable district of Ginza, with a 600m2 facility, the restaurant features a newly designed interior using innovative materials, especially picked to guarantee an exclusive ambiance and atmosphere.

BiCE TOKYO www.bicetokyo.com Tel: 03-5537-1926, Fax: 03-5537-1929 E-mail: info@bicetokyo.com

Estate Wines

Elio Locanda Italiana

Add some sparkle to your holidays with inspiring wines and champagne from Estate Wines.

Shop in English at www.estatewinesjapan.com and receive your wines hassle-free within a couple of days.

Delivering the finest traditional southern Italian cooking in Tokyo for almost 15 years, Elio Locanda Italiana is preparing to celebrate the Christmas season with friends and new customers. As with every year, carefully selected seasonal ingredients, seasoned staff and gratitude for another year shared give life to Elio’s highly appreciated Christmas menu, available only during this season at the special price of ¥6,825. Come together at Elio to celebrate the year in truly Italian fashion!

Also open Sunday, 19th & 26th December.

Use code EUR2010 and receive a discount of ¥2,000 for orders above ¥15,000. We also offer a corporate gift service.

For personal assistance contact W. S. Forster at 078-777-6616, or sales@estatewinesjapan.com

Ruth’s Chris Steakhouse

Tel: 03-3239-6771 www.elio.co.jp

La Tour D’Argent

Since 1582, La Tour D’Argent has defined exquisite French cuisine with a standard of quality honoured as the most authentic representation of French culture and tradition. La Tour D’Argent Tokyo celebrated its 26th anniversary in September, and majestically wines and dines you with the best wine cellar in the world and the seasonal creations of Chef Trancher, which includes à la carte and course dinner menus. Call 03-3239-3111 for reservations to enjoy the special Christmas dinner menu. www.latourdargent.co.jp/newotani

Ruth’s Chris Steakhouse in Kasumigaseki, Chiyoda ward, is serving a delicious Christmas Course menu available on 24-25 December, Friday-Saturday. For those guests who make reservations for 17:00 or 17:30, a free glass of Champagne will be served at your table.

For those other special occasions, there are private rooms for 8-22 people, and an All-You-Can-Drink Plan for 15 people or more for ¥4,000/person (includes tax plus 10% service charge).

Tel: 03-3501-0822 www.ruthschris.co.jp

Hotel Niwa Tokyo

The Strings by InterContinental From December 22 to 25, The Strings by InterContinental Tokyo serves Special Christmas dinners at two restaurants of the hotel – French Fusion restaurant ”The Dining Room” and Chinese restaurant “China Shadow”. The culinary arts of the hotel chefs will be on display in the season’s dazzling menus.

Special dinner course: ¥12,600 per person (tax included; service charge not included) For more information and reservations, please call 03-5783-1258.

Hotel Niwa Tokyo offers two restaurants – YUKURI and Grill & Bar LIEU – with seasonal views of the courtyard garden. The Japanese restaurant takes its name from an ancient word meaning “to achieve rapport”. At YUKURI you experience authentic kaiseki cuisine in a setting that is at once modern and traditionally Japanese. Whether with the sweeping garden view or in the intimacy of a private dining room, you’ll enjoy a culinary experience to be treasured.

December 2010

27

Medical Devices// A “medical device gap” deprives Japanese patients of the latest care Text Geoff Botting

T

he medical device lag,” says Danny Risberg, “has become the medical device gap.”

According to the chairman of the EBC Medical Equipment Committee, companies have long been dogged by the “lag”, namely the inordinately long time it takes Japanese regulators to approve new products.

In many cases, by the time their equipment enters the market, it has been superseded by newer models with improved technology already available in other countries.

The situation has improved little over the years. And now Risberg, managing director of Philips Electronics Japan, and others in the industry say they’ve witnessed the lag turn into a fullfledged gap.

What’s the difference? The gap means foreign manufacturers of critical hospital and clinic equipment, such as ventilators and therapy devices, have

28

December 2010

About half of all the latest medical equipment … is not available in Japan

grown so frustrated they’ve simply given up on the Japanese market.

Some aren’t even bothering to try to get devices approved, says Risberg.

“They’re telling themselves, ‘If we’re going to take all that risk and spend all that money, isn’t it better to go to a market that’s easier and faster?’”

One statistic the committee often cites is that about half of all the latest medical equipment in the world is not available in Japan. What’s more, the makers walking away from the Japanese market – the gap – account for roughly 40% of the total global market, according to the committee’s research.

“It’s not worth the expense for them, and they don’t like the uncertainty,” says Risberg.

The entire process of getting a medical device approved – from the time it’s submitted for review to the time revenue starts to roll in – typically takes from two-and-a-half to three years. A portion of that time is waiting for Japan’s national health insurance system to start paying reimbursements.

Clearly, closing the medical device gap is the committee’s overall objective. The benefits of accomplishing that would be felt far beyond European manufacturers; patients in Japan would be the ultimate winners. “We think the gap is depriving the Japanese public of better care,” the committee boss says.

So what’s at the root of the problem?

Shortages of reviewers? Intractable red tape? Protectionism?

“There’s no one answer,” Risberg shrugs. “Probably, it’s everything all put together.” He prefers to see the situation as “systemic”.

I n C ommittee

The committee’s list of advocacy issues is split into two broad sections: harmonising approval standards, and restructuring reimbursement prices.

The former comprises a number of different technical issues. “It’s not one thing we can fix; it’s a number of things that need to be fixed. And you can’t fix one thing and then hope for the situation to get better,” says Risberg.

“Unfortunately, it’s a very matrixed, bureaucratic and complicated system.

We may not like it, but we need to deal with it.”

Among specific issues, a major concern is the so-called “quality management system” (QMS). The committee complains that the Japanese government has failed to implement the QMS for medical equipment in a way consistent with international standards.

As an example, Risberg explains that, in Japan, unlike in Europe, every time a new product is submitted for approval, regulators require data to certify the facility where the product is made

Key advocacy issues 1) Acceptance of clinical trial data from overseas 2) Implementation of the quality management system (QMS) in a way more consistent with international standards 2) Adjusting reimbursement prices to better reflect the costs behind the highly sophisticated technologies used in today’s medical equipment 3) Factoring into reimbursement costs unique to Japan, such as those incurred during long and difficult certification processes – even if that facility has been certified before.

“You’re doing the same work over and over and over – and it’s more work for the Japanese side as well,” says Risberg.

“Fixing this [discrepancy] would speed up the process. It would reduce the cost and burden for all of the companies involved.”

But while the area of harmonisation has seen little progress over the years, there is better news on reimbursement prices.

Under the first revision of the system for a decade, in April 2010, the Ministry of Health, Labour and Welfare introduced a new schedule of reimbursement prices. This rewarded some advanced technologies, such as certain types of imaging and digitisation of documents.

Risberg calls the change “a huge leap”, seeing it as an acknowledgement that “better, more advanced products offer better value.”

Given all the issues and their complexity, the committee’s members have their work cut out for them. Risberg, an American who has done business in the healthcare field for the past couple of decades, oversees a busy committee that is split into several working groups focusing on specific issues.

“We need to be out there doing it every day,” he says. “It’s a giant oil tanker that we’re trying to turn.”

December 2010

29

G reen B iz

Communicating sustainability Entrepreneur helps companies green up their act Text and photos Tony McNicol

A

fter working as an English teacher, school manager, freelance communications consultant, then investor relations and corporate social responsibility (CSR) specialist in Japan, Luke Poliszcuk decided to found his own company. “I saw an opening for more specialised CSR reports,” says the 32-yearold CEO of eQualC, which specialises in sustainability communications.

Luke Poliszcuk

eQualC, he explains, stands for equal-carbon, i.e., a fair and reasonable amount of carbon emissions for each person on the planet – the ultimate green goal. “Ideally,

we should be providing sustainable development funding to developing countries to compensate them for the carbon we are producing.”

The company was founded in April 2009 with $10,000 from private investors. So far, Poliszcuk, who is midway through an MBA in sustainable management, has been helping companies produce CSR reports that focus on green goals. Sole full-time employee Poliszcuk works with freelancers on a projectby-project basis.

Over 80% of large Japanese companies issue CSR reports, he notes, but typically the English versions are direct translations of the Japanese without any attempt to tailor the contents to an international audience. To make matters worse, the original Japanese can veer between being indirect and vague, and the other extreme of offering reams of unnecessary detail.

“Our end goal is to help companies implement strategic sustainability,” he explains. “We want to promote exchange – act

An eQualC−organised event at the British Council

as a bridge between Japan and the rest of the world.”

Eventually he wants to act as a consultant. The next goal of the company is to consult on implementing major corporate sustainability programmes.

Another of eQualC’s initiatives is the Green Leaders Forum, a monthly event that started in February 2010. It provides networking, learning and business opportunities to attendees, 60% of whom are Japanese. Around 100 people come to each event. “We had to have people stand in the hallway last month,” says Poliszcuk.

Poliszcuk sees plenty of opportunity for his business, despite the current economic malaise. “There is a huge green business boom,” he says. “Even during the recession, green business did relatively well. The sense I get is that the younger generation is very interested.”

Even during the recession, green business DID relatively well What better place than Japan for a business that focuses on sustainability?

“A lot of people think that Japan is not an environment friendly society, but I disagree,” says Poliszcuk.

“Japan may not focus on preserving its natural environment as much as Australia, the United States or Canada, but it is considered the world’s most energy-efficient economy and has one of the best recycling systems,” he points out. “The rest of the world has a lot to learn from Japan.”

Yet there is still much to do. If everyone lived the same way as the average American, he points out, humanity would need five planets to meet its needs. If everyone lived as the average Japanese, “just” two and a half would be necessary.

December 2010

31

Industry experts | Business Intelligence

“A key first step for any business is hiring the right people.

Pre-employment screening reduces the risks of a bad hire” Tim Bennett, General Manager – Japan & Korea

There are three main drivers of employment screening – compliance, protection and performance.

More and more companies are introducing and enforcing internal compliance programs. These are designed to reduce risks to the business and ensure that all employees are treated openly, fairly, and in a way that can improve their own workplace safety and performance.

A key first step for any business is hiring the right people. Pre-employment screening reduces the risks of a bad hire.

In addition to these internal compliance programs that include pre-employment screening of new employees, many of our clients conduct an external audit of us to evaluate our data privacy protection systems and confirm the trust other clients place in us.

In the first 10 months of 2010, we found that 14% of hires in Japan had a discrepancy in the information they provided to their prospective employers.

Discrepancies ranged from exaggerated employment claims to criminal convictions. We also have detected a huge increase in falsified educational qualifications.

In addition, employee fraud has been well covered in the press. If an employer has not been directly impacted by an incident of employee fraud, chances are they usually know someone who has.

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Though the press is full of stories where things have gone wrong, if the level of pre-employment screening is appropriate, these risks of fraud can be dramatically reduced. Screening creates a safer environment for both your business and employees.

Employment screening has become recognised as best practise as more employers implement it in their hiring procedures. If your competitors are screening their employees and you’re not, then the bad candidates will apply to you as the easy option.

Rightly, employers are highly focused on recruiting the best talent. The savings in recruitment, training and attrition costs can be easily calculated. Appointing the most appropriate talent has a major positive impact on the bottom line.

Many HR professionals have used our services and seen firsthand the benefits of an extensive screening process. They value maintaining security and safety in their workplace and the ability to outsource this role to experts in screening.

Nowadays, many job candidates have an international education or overseas work experience. We have the expertise and contacts to screen your internationally experienced candidates whilst providing you with local language support and knowledge here in Japan.

First Advantage is a global industry leader; we see trends developing around the world – and these insights help us to stay ahead. For example, outside of Japan, many clients now conduct ongoing and random screening throughout the employment period.

People’s circumstances change, which can lead to behavioural changes that put your business and other employees at risk (a gambling addiction or an undeclared criminal conviction being two obvious examples).

For more information about introducing screening to your business, enhancing the screening you already perform, or outsourcing your screening function, please contact Tim Bennett at info-jp@fadv.com or visit our website at www.fadvasia.com

Industry experts | Business Intelligence “We are able to present an early, 360°picture of risks from intellectual property, regulatory and market entry perspectives and set clients in the right direction”

Besides R&D, technology, HR and marketing, sophisticated protection of intellectual property and regulatory compliance are certainly priorities of experienced corporations. In the course of a venture into a new market, IP and regulatory concerns usually become urgent only when the business has reached a certain size. However, in fact, lack of proper protection and foresight of these two issues in the local context create corporate risks from the first moment. For reasons as simple as language barrier in a Japan venture, such risks grow with each undertaking and become apparent only when they have realised themselves in the form of severe damage to the business. We are able to present an early, 360°picture of risks from intellectual property, regulatory and market entry perspectives and set clients in the right direction.

Intellectual Property In a first-to-file system like Japan, brand protection should come before contacting a potential business partner, before disclosing your market-entry ambitions to your competitors, and way before the product launch! Early precaution not only saves you the need for re-branding, but also maintains your freedom of choice with respect to local partners. Our full range of IP services

– from trademark and patent searches and renewals to technical translations, trademark watching, tracking of copyright infringements conducted over the Internet – protect foreign businesses in their ventures in Japan, thereby securing their investments in the long term.

Regulatory Compliance Globalisation has caused regulatory hurdles to be set higher than ever in Japan; products have to comply with stricter rules, meet more stringent requirements and pass more thorough inspections before their import gets granted. The first success in online sales can come to an abrupt end when the first import by your newly set up Japanese subsidy reveals belatedly that the formulation, labelling and marketing material of your products are incompliant, and that the brand name is not available for use here.

Therefore, no matter if you begin sales by cooperating with a local distributor or in your own right via the Internet, our scientists and lawyers are there at the outset to help your marketing and R&D departments meet all requirements of local regulatory authorities, register products and acquire necessary licenses, supervise and analyse testing of imports, advise on labelling and marketing material compliance – all before your product launch in Japan.

Finally, our import and distribution licenses, customs clearance, logistics and communications for – and with – our clients offer quality assistance every step of the way. The key to reduced risk exposure in a market venture is seamless coordination and a hawk-eye view of the aforementioned three interlinked issues.

nipponCompass is a Tokyo-based group of service and consulting companies, and law firms providing high-value intellectual property services, guidance in regulatory procedures and all-round market entry support. By linking these three fields, our highly international, multilingual team of experts understands our foreign and local clients’ needs profoundly and supports them with extraordinary and innovative services while guarding the spirit of their businesses and their goals.

nipponCompass | 日本羅針盤 mail@nipponcompass.co.jp www.nipponcompass.co.jp Tel: +81 (0)3 5500 2272

December 2010

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Industry experts | Business Intelligence

“The company behind the headlines�

FTI Consulting Inc. is a NYSE-listed global business advisory firm dedicated to helping organisations protect and enhance enterprise value in an increasingly complex legal, regulatory and economic environment.

Through strategically located offices in every major financial centre, FTI Consulting provides a wide range of sophisticated investigative services to assist multinational corporations with rapid, confidential responses to issues relevant to business conduct in the Asia-Pacific region and worldwide.

Our capabilities include transactional investigative due diligence, anti-bribery and corruption investigations, internal controls and compliance remediation, regulatory inquiries, brand protection and IP strategies, forensic accounting reviews, and other risk mitigation and consulting services.

We also possess state-of-the-art electronic evidence and document review tools, enabling us to provide costeffective data identification, collection

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December 2010

and review services in English and Asian languages including Japanese, Korean and Chinese.

FTI Consulting is led by seasoned professionals with extensive high-level investigative and corporate risk experience, and globally deploys more than 3,500 personnel. Our multicultural teams combine the skills of forensic accountants, law enforcement officials, anti-corruption investigators, computer forensic specialists, and corporate, financial and crisis communications experts. This breadth of experience enables us to bring a multidisciplinary approach to business-critical investigations that require exceptional strategic and technical capabilities.

From corporate scandals to political instability, companies today confront an ever-increasing array of business, economic and political concerns that directly impact their operations and profitability. Whether the task is to determine the reputation and suitability of a business partner, untangle a complex fraud scheme, identify internal

control violations, protect intellectual property assets, or capitalize on business opportunities through timely and accurate business intelligence, FTI Consulting provides clients with actionable intelligence and value-added analysis for informed decision-making.

In Japan, FTI Consulting operates under the legal entity of International Risk Ltd. Key Contact Masashi Niwa, Japan Representative Tokyo Office Shinjuku, Tokyo 03-5369-3939 masashi.niwa@fticonsulting.com www.intl-risk.com www.fticonsulting.com

Pink Ball 2011 “Hollywood Romance” will be held on Friday, February 25th 2011 at The Westin Tokyo.

It is sure to be a night filled with exciting ‘firsts’ and unforgettable performances! Silent and live auctions will offer guests the opportunity to bid on a wide variety of luxury trips, hotel stays, and other fabulous prizes.

A special dinner prepared for just this evening will be accompanied with fine wine and cocktails.

Enjoy a luxurious evening on the red carpet!

http://www.runforthecure.org/

Incorporated wizards

We grow innovation

www.wizcorp.jp

EVENT REPORT

Tuesday night fever Italian disco

2 November 2010, Fiat Space, Aoyama Text David Chevalier Photos Tony McNicol

Y

ou know it’s going to be an interesting night when the disco has free gourmet chocolates, Turkish belly dancers, and Austrian pop blasting past midnight.

The Italian Chamber of Commerce in Japan (ICCJ) invited members and friends to “network on the dance floor” at the second Italian disco night, hosted at the Fiat Space nightclub in Tokyo.

EURObiZ was among the approximately 200 attendees taking in the sights and sounds during an eventful evening.

“We’ve been holding these events as an alternative in order to wake people up – and it’s working,” said Davide Fantoni, secretary-general at the Italian Chamber of Commerce Japan. He was right.

The first thing I noticed when entering the venue, besides a perhaps ironic door sign reading “no dancing”, was the relaxed atmosphere and stylish decor in the dimly lit venue. Eager guests were filling the floor space and bar areas by 9:30pm. House music played in the background as staff made the rounds, offering chocolate samples to guests.

Contrary to the event’s title, the music of the night was anything but disco, and songs spanned a wide range of genres: house, techno, top 40 and even some Turkish music.

Hiroshi Kobayashi told me that he found out about the event via a

Facebook group. A systems manager for a computer venture company, Hiroshi has a deep interest in Italy and has travelled to the country several times. Since he speaks Japanese and English, and has studied some Italian, at the disco he was hoping to meet people from across the globe and make international connections.

By 10:30pm the club was getting crowded. I couldn’t walk from one end of the dance floor to the other without bumping into a few dozen people.

Two college students at the event together, Hiroki and Tsukasa, told me that they were invited by one of the DJs. It was their first time at an ICCJ event, but they’d come to meet people from Italy. They said they were fascinated by Italian culture, music and language.

Alessandra, an Italian-language teacher, told me she’d “come to enjoy the evening and dancing”. Not long after, the DJ turned up the music and two belly dancers sashayed onto the dance floor.

The DJ turned up the music and two belly dancers sashayed onto the dance floor

Most attendees I spoke with were at their first ICCJ event, but Kindel Elam, an attorney from the United States, told me she had had a great time at the previous disco night. Apparently, that event had been just as crowded.

The flyers had advertised the event as finishing at midnight, but the ICCJ’s Fantoni gleefully assured me that “tonight’s event goes all the way until 5am”. That was in between navigating his way through the busy crowd, overseeing the event, and greeting people at the entrance.

I’d come expecting to catch a glimpse of Italian music and culture, or even a little “Saturday Night Fever”, which didn’t quite happen. But overall, the Italian disco night was memorable.

By midnight, the guests were dancing (despite the posted prohibition), chatting or raising their glasses to yell out cheers in a variety of languages.

Yes, the Italian Disco Night was anything but a sleepy chamber event.

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Text and photos Rob Gilhooly

Twenty years as a brewer, but I still find all that dancing around of micro-organisms as fascinating as ever

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C ulture S hock

It’s a cool early October morning at Kinoshita Shuzo sake brewery and like at many kura across Japan, staff are performing a time-honoured ritual, taking turns to bow in front of a small Shinto shrine to pray for a prosperous brewing season.

Yet, unlike at any other of Japan’s over 1,800 kura, featuring prominently in the 170-year-old Kyoto brewery’s ritual is a sandy-haired, bearded foreigner. Englishborn Philip Harper is Japan’s first and only foreign toji, or master-brewer.

By the time Kinoshita’s latest line of “Tamagawa” products appears on store shelves in the spring, Harper will have completed 20 seasons in the business.

completely change character fascinated me.”

When a Japanese friend quit his day job to enter a Nara-based brewery, Harper’s life took an unexpected twist. After paying regular visits to the brewery, within a year he found himself working there, too.

“The owner enrolled me in a four-year correspondence course in brewing science, but I really learned the process the same way that the master brewer and his father and grandfather had: on the brewery floor.”

Harper’s reputation grew within the industry, in large part due to his devotion to duty. On one occasion, exhausted

“My old boss used to say that sakemaking is a mixture of experience and sense. And the next line was invariably, ‘you don’t get that sense without the experience’. There is a scientific background to it, but on the brewery floor it’s mostly about touch.”

It would seem those words of wisdom have paid dividends. One of Harper’s brews was awarded a gold medal at the 2008 national sake awards, while Kinoshita Shuzo’s sales have grown 30% each year since he took charge.

This is all the more remarkable considering the state of Japan’s sake industry, which has been in decline since the mid-1970s. “Sake is no longer an

“It’s slightly alarming – 20 years as a brewer but I still find all that dancing around of micro-organisms as fascinating as ever,” says Harper, 44.

“Everything about sake, the traditional brewing method and artisan system that I learned the ropes under – not to mention the taste of the drink itself – are incomparably complex. I never feel there’s nothing new to learn.”

It was that complexity which attracted Harper to sake when he arrived in Japan in 1988 fresh from Oxford University to teach English as part of the Japan Exchange and Teaching Programme.

But a thirst for deeper knowledge led him to take up an evening job at a sake bar. “My interest went up a notch when I first noticed what happens to sake as you drink it at different temperatures.

That the same liquid from the same bottle could, in a matter of seconds,

after a particularly busy period, he fell asleep on his bicycle and plunged into a river.

His unwavering commitment, and extensive knowledge, eventually earned him the prized qualification of master brewer, and after becoming Japan’s first foreign practicing toji he was taken on at Kyoto’s Kinoshita Brewery in 2007.

Harper’s day during the six-month brewing season starts at 7am and breakfast with the other six brewery hands, followed by a frenetic day of washing, soaking and steaming freshly milled rice.

A portion of the rice is taken into the culture room, where it is inoculated with koji, the all-important mould that Harper tends in the evening after all the other staff have finished for the day. During the night he gets up several times to cast his expert eye over the bubbling vats of fermenting rice.

automatic element of every household.

It’s a consumer choice item. The industry didn’t switch on quickly enough to this paradigm shift, and to me that’s the biggest single own-goal that this industry has scored.”

Mimicking domestic success, Kinoshita has begun selling its products in the United States, and has garnered awards in that fast-developing sake scene. Last year it started selling in the UK, and the brewery plans to target continental Europe.

“The great thing about sake is that it can be served happily with any kind of food, which is one reason that it has gone from strength to strength overseas. Sadly that’s yet to be appreciated in Japan.

“I hope that sake’s success overseas will have a boomerang effect and make Japanese realise what a great national drink they have.”

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39

Who’s Who

Business Travel in Japan

Who’s Who // Business Travel in Japan

Confident of continued growth

W

e at Cathay Pacific – like the airline industry at large – have faced exceptionally challenging times these past few years. Yet, the market in general has rebounded quickly since the third quarter of 2009.

High load factors and increasing yields – particularly in our business class cabin – reflect a strong rebound in travel, mainly in Asia. Our cargo business has also experienced a healthy recovery.

The International Air Transport Association (IATA) announced international traffic results for September.

International passenger traffic had a 10.5% year-on-year increase, which is significantly stronger than the 6.5% rise recorded for August. International freight traffic recorded a 14.8% year-onyear increase, yet is significantly weaker than the 19.0% rise recorded in August.

Cathay Pacific Group has a record profit of over HK$6.8 billion for the

first six months of 2010. We have seen growth in two very important areas –premium traffic and cargo. We have sustained our efforts to broaden and upgrade our products and services such as new aircraft, new staff and investment in facilities.

There are still signs of a strong demand going forward. If present trends continue, we expect our financial results to remain strong in the second half of 2010. That said, conditions can change rapidly in the airline industry. Our results would be adversely affected, and very quickly so, by a significant further increase in fuel prices or any return to the recessionary economic conditions of 2008 and much of 2009.

The Cathay Pacific Group and Hong Kong remain confident in the long term.

We have a number of factors working in our favor. There is our capable, supportive and committed team, and superb international network. An effective

Simon Large General Manager Cathay Pacific Japan

management of costs, our quality service and product offering, a strong relationship with Air China, and our position in Hong Kong are other strengths.

A passion for perfection

S

wissôtel Nankai Osaka was recently recognized as “Japan’s Leading Business Hotel 2010” at the prestigious World Travel Awards (WTA). The WTA were founded in 1993 and are considered the foremost indicator of excellence in travel products and services worldwide. This year’s results were based on an independent vote by 185,000 travel agents and tourism professionals in over 200 countries. Swissôtel Nankai Osaka stood out among 11 other prestigious hotels nominated in Japan.

“We are proud to be recognised

by World Travel Awards and thrilled to be awarded as ‘Japan’s Leading Business Hotel 2010,’” says Christian Schaufelbühl, General Manager of Swissôtel Nankai Osaka. “We are grateful to our guests who support us and all of our team members who work hard to achieve a ‘Passion for Perfection’, which is to provide warm Swiss hospitality combined with quality, efficiency and reliability.

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December 2010

“This award as ‘Japan’s Leading Business Hotel 2010’ stands as testament to our ongoing efforts for service excellence,” he adds. “And we will continue to exceed guest expectations.”

The deluxe hotel offers 548 guestrooms and suites ideally located at the very heart of the most energetic quarter of Osaka. The hotel above Namba Station directly connects to Kansai International Airport by train and is steps away from the city’s business, cultural and entertainment districts.

The facilities of this 36-storey luxury hotel leave nothing to be desired: a choice of eight restaurants and bars, Amrita Spa & Health Club, indoor swimming pool, 19 banquet/meeting rooms and even three wedding chapels. The 548 spacious luxurious rooms and suites ensure an unrivaled experience with the ultimate in amenities and in-room technology. The Executive floors offer such top-class amenities as an Executive Club Lounge. The renovated signature restaurant, Tavola36 Italian Restaurant

Christian Schaufelbuehl General Manager Swissôtel Nankai Osaka

& Sky Bar, is now Osaka’s latest and most vibrant dining and entertainment venue. www.swissotel.com/osaka

W

hether you fly once a year or once a week, SAS Credits membership cuts corporate travel costs from the very first flight. And Scandinavian Airlines’ new corporate program is just a mouse click away.

Earn up to 8% SAS Credits on SAS Group flights. You can register online – with no joining fee – and start earning SAS Credits immediately. Simply book your flights as usual through your travel agent or on www.flysas.co.jp by using the assigned login details for your company account and booking code for flight reservations.

There is no limit as to how many SAS Credits can be earned, and you can easily view your account online. It’s a win-win situation with the company earning SAS Credits while the employee travelling earns EuroBonus/Star Alliance points. As a corporate, you earn valuable

Who’s Who // Business Travel in Japan

Start saving from the first flight SAS Credits in all service classes every time your staff travel SAS – no matter what ticket you buy. The earned SAS Credits can then be used to purchase new flights.

A great solution SAS flies to more than 60 destinations in Scandinavia. World-class transfers at SAS hub Copenhagen Airport make the travel and smoother with a good connection to Brussels, Dusseldorf, Geneva and more than 100 destinations in Europe.

Mr. Ole Johansson Regional General Manager Asia & Pacific Scandinavian Airlines

Register SAS Credits today at www.flysas.co.jp and start saving.

Greater connections and service onboard

T

urkish Airlines, founded 78 years ago and based in Istanbul, has expanded its network to over 160 cities around the world, including 72 destinations in Europe. The airline operates a six-times weekly service from Narita and a four-times weekly service from Kansai (Osaka) to Istanbul.

Come this April, frequency of the Kansai service will increase to 5-times weekly.

Since being privatised in 2006, Turkish Airlines has been dramatically reorganizing. The total passenger numbers during the first three quarters of 2010 increased 18% and cargo increased 41% over the previous year.

The Turkish Airlines fleet, the most modern consisting of Boeing B777300ERs designed for long-haul flights including Japan routes, was delivered this September with a brand new Business Class as well as Premier

Economy called Comfort Class. The aircrafts will be deployed at Narita on the Tokyo-Istanbul route this coming summer.

The Kansai service arrives in Istanbul early morning, allowing for convenient connections to any destination in Europe, the CIS, the Middle East and Africa. The Narita service arrives late evening so all passengers making a connection are provided free overnight accommodation in Istanbul. The campaign, called “One Night Istanbul”, enables passengers to enjoy the beautifully ancient yet modern city of Istanbul and its many historical world heritage sites, and more.

The airline’s in-flight meal developed

by Turkish Do & Co, the renowned food producer in Europe, defines a distinguished service feature. “Flying Chef” caters onboard to both Business and

Comfort classes. For brand promotion, players of FC Barcelona and Manchester United are appearing in the airline’s TVCF and on their billboards. They are also part of an original design painted on Turkish Airlines aircraft in the team’s hometown colours.

Having one of the most quickly expanding flight networks, Turkish Airlines is “Globally Yours” around the world from or via Istanbul.

Tuba Toptan Yavuz Director for Japan Turkish Airlines

December 2010

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Who’s Who // Business Travel in Japan

Air France

Tel

03-3570-8577

Web site

www.airfrance.co.jp

Business That Keeps Getting Better Business Class at Air France constitutes a privileged travel experience for corporate account customers and individual business or leisure customers alike. The introduction of Airbus’ A380 on Tokyo-Paris route on 2 September, now operating daily, and commencement of a new route between Tokyo’s Haneda and Paris’ Charles de Gaulle in a codeshare flight with Japan Airlines strengthen the Japan route with 35 flights per week in total.

Every stage of the trip has been carefully studied to ensure customers receive professional, streamlined and efficient service. There is fast priority access guaranteed by dedicated check-in desks. Where facilities and local legislation permit, Air France’s Business Class passengers are given priority channels through customs and security checkpoints. There is also access to 500 lounges worldwide, including close to 50 Air France lounges.

Once onboard, comfort is state-of-the-art. A passenger’s privacy is ensured by the fixed-shell seat structure, designed for increased sleeping comfort. In a matter of seconds, the seat can be adjusted into a near-horizontal bed, 61cm wide and over 2m long, making it one of the longest on the market. The integrated fixed footrest offers Business Class passengers a more stable sleeping position in the bed position.

The leather headrest with moveable wings is softer than ever before and adjustable vertically and horizontally. New relaxation positions for the seat, with legs extended, are possible even during take-off and landing.

Business Class passengers also enjoy genuine French-style gourmet dining. Combining seasonal produce and authentic flavours, the refined and original menus are designed by chefs from Servair – and wines chosen by Olivier Poussier, ranked the world’s best sommelier (2000).

Business Class dining service aims to provide a more varied choice in cuisine and deliver true, high-class restaurant-style catering. Air France continues to rethink mealtimes with brand new dishes, increased frequency of renewed menus, and introduction of new features.

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December 2010

Who’s Who // Business Travel in Japan Tel

03-3568-1588

Web site

www.alitalia.co.jp

Alitalia – Compagnia Aerea Italiana S.p.A.is Italy’s leading airline, a completely private company, operating 4,500 flights weekly across a network of 79 destinations – 26 in Italy and 53 in the rest of the world.

In 2010 Alitalia increased the flights between Italy and Japan: the weekly frequencies between Rome and Tokyo increased from nine to 10; the frequencies between Milan Malpensa and Tokyo increased from three to four.

Alitalia is the only airline to offer direct links between Italy and Japan, providing 18 flights per week between the two countries.

Besides completely redesigned interiors and full-flat seats on the Airbus330 fleet, Alitalia renewed the in-flight service of the Magnifica Class, offering the recipes of Italian regional cuisine and wines selected from the best Italian wine producers by the Italian Sommelier Association. A selection of Italian wine from some of the country’s top wine cellars is also offered in all our classes.

The investments made and the actions taken by Alitalia have produced significant results in terms of not only punctuality (82% in October 2010) and regularity of flights (99.8%), but also customer satisfaction.

December 2010

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Who’s Who // Business Travel in Japan

Cathay Pacific Airways

Tel Reservation/Ticketing Center

03-6746-1000

Web site

www.cathaypacific.com

Cathay Pacific’s new Business Class makes flying a pleasure. Relax in a comfortable seat with massage function and easy access to the aisle.

Enjoy more entertainment choices than ever before. Access all your inflight essentials with convenient stowage. There’s mood lighting to enhance your flying experience; and when it’s time to sleep, simply press a button to turn your seat into a perfectly flat bed for a wonderful night’s rest.

And our new Business Class helps your business. Store large items under the ottoman, and keep small items such as your PDA, glasses and pens in the trinket tray. Your reading light offers variable levels of brightness. You can write a letter or catch up on work using the large tray table, complete with 110V AC power supply.

Cathay Pacific is offering the Business Class airfare to Europe priced from ¥280,000 – named “Biz- toku”, which is on our PEX fare line-up, and available for purchase online. Check out www.cathaypacific.com At Cathay Pacific, your needs always come first – which is why our new Business Class is such a pleasure.

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December 2010

Who’s Who // Business Travel in Japan

Finnair

Tel

03 3222 1691

Web site

www.finnair.co.jp

When you fly Finnair’s Business Class, you get more out of your trip at the airport, on the plane, and at your destination. Business Class tickets are flexible, with last-minute changes and cancellations possible based on availability. You can check-in either in person at the desk, in the lounge if travelling with carry-on baggage only, by SMS while in your taxi to the airport, or online at your hotel. As a Business Class traveller, you are allowed to take up to 10kg more checked baggage. Along with hand baggage, your briefcase or laptop can be taken into the cabin. Lounges are available to Business Class travellers at the international gate areas of all Finnair’s scheduled flight destinations, before, in between or after your flights. Finnair’s intercontinental meals and wines have been awarded several international prizes, and during such flights Business Class travellers can sleep peacefully on the latest lie-flat seat. Entertainment is provided by a personal entertainment system and a wide selection of international newspapers and magazines. Business Class luggage, labelled with a priority tag, appear first from the hold.

December 2010

47

Who’s Who // Business Travel in Japan

KLM Royal Dutch Airlines

Tel

03-3570-8770

Web site

www.klm.co.jp

The Pleasures of Business Begin Before the Flight At KLM Royal Dutch Airlines, the journey is just as important as reaching the destination. That’s why the addition of three flights a week between Tokyo’s Narita and Amsterdam’s Schiphol from 5 November – raising the total number of Tokyo-Amsterdam flights to 10 a week – means even greater comfort over the long haul.

World Business Class of KLM Royal Dutch Airlines provides benefits commencing before departure, with allowance for extra baggage and check-in at dedicated desks. There are priority lanes where available through customs. KLM Crown lounges at Amsterdam, Schiphol, Air France lounge in Narita and KIX Airside Lounge in Kansai International Airport – and lounges of the SkyTeam partners at other airports – offer World Business Class passengers a place to relax before boarding.

Once onboard, experienced cabin attendants handle and anticipate their every need. The 190cm-long, 175°-reclining seats with massage option ensure that World Business Class passengers arrive relaxed and fit as a fiddle. A personal interactive entertainment system delivers the latest films and popular TV shows, audio books, language courses and more. The system can send messages to any telephone or email address in the world, and each seat has a laptop connection. There is a collection of international newspapers and magazines available.

Delicious three-course menus prepared specially by top chefs are served on quality crockery, accompanied by a glass of fine wine or drink of choice. Among the culinary choices for World Business Class passengers are authentic Japanese dishes created by Hotel Okura Amsterdam’s chef served on Noritake porcelain on Japanese routes.

There is a selection of exclusive items for purchase on top of the usual gift choices for loved ones. As an expression of appreciation, KLM Royal Dutch Airlines gives one of the famous Delft Blue miniature houses filled with genuine Dutch genever – befitting the ultimate experience of World Business Class.

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December 2010

Who’s Who // Business Travel in Japan

Lufthansa German Airlines

Tel

0120-051-844

Web site

www.lufthansa.com

Lufthansa will be celebrating 50-years of operation between Japan and Germany on 24 January 2011. You can depend on Lufthansa to get you to your destination, which includes the airline’s A380 connecting Tokyo-Frankfurt seven days a week. This aircraft, with more than a 500-passenger capacity, has 98 seats set aside for Lufthansa’s topquality Business Class on the upper deck, providing an exceptional level of comfort and service en route. At many airports, Business Class guests utilise one of the numerous Priority Check-in counters.

On long-haul routes, Lufthansa creates an onboard environment of greater exclusivity, flexibility and peace of mind – where you can sleep soundly, relax or work. The airline’s onboard broadband internet-access service, “FlyNet”, is scheduled for Japan routes in the near future.

Business Class offers a choice of three starters and spoils you with mouth-watering cuisine, thanks to Lufthansa’s cooperation with either luxury hotel chains or popular restaurant chefs. Regional star chefs create delicious local delicacies on selected intercontinental flights.

Culinary delights are suitably complemented by tableware designed

by Rosenthal. Individual Express Menu and optional “Breakfast-to-go” mean you can rest longer.

December 2010

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Who’s Who // Business Travel in Japan

Scandinavian Airlines

Tel

SAS Credits Support 03-5425-8190

Email

corporate.jp@sas.dk

Web site

www.flysas.co.jp

Back in1951, SAS inaugurated its first flight from Scandinavia to Tokyo. At that time the route took 55 hours with several stopovers.

Almost 60 years have passed, and SAS now offers three service classes on its Airbus A340 – Business, Economy Extra and Economy. SAS’s unique “Combinable Fares” allows passengers to combine two of the service classes in one roundtrip ticket. It’s a great solution for business travellers who are required by their companies’ strict travel policy to fly at a reasonable fare. For example, you can combine Business with Economy and save up to 45% compared to flying Business Class both ways, from and to Tokyo. SAS also soon will offer internet access on board.

Even better for business travellers, SAS has launched a new corporate program. A corporate customer can earn and collect points called SAS Credits every time their employees travel. SAS Credits can be used for purchasing new flight tickets. Partial redemption together with credit card payment will also be possible. In short, the company earns SAS Credits and the traveller earns EuroBonus/Star Alliance points.

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December 2010

Who’s Who // Business Travel in Japan Address

KDX Bldg. 2F, 2-7-19, Hamamatsu-cho, Minato-ku, Tokyo 105-0013

Tel

03-3435-0421

Fax

03-3435-0422

Web site

www.turkishairlines.com

Having one of the most quickly expanding flight networks, Turkish Airlines is “Globally Yours” around the world from or via Istanbul.

The Turkish Airlines fleet, the most modern consisting of Boeing B777-300ERs designed for long-haul flights including Japan routes, was delivered this September with a brand new Business Class as well as Premier Economy called Comfort Class. The aircrafts will be deployed at Narita on the Tokyo-Istanbul route this coming summer.

The airline operates a six-times weekly service from Narita and a four-times weekly service from Kansai (Osaka) to Istanbul. Come this April, frequency of the Kansai service will increase to 5-times weekly.

Turkish Airlines announced the new fleet order of 105 aircraft back in 2008. A total of 89 aircraft are scheduled for delivery up until 2016, when the total fleet of 196 will be 1.5 times the current number.

Turkish Airlines, founded 78 years ago and based in Istanbul, has expanded its network to over 160 cities around the world, including 72 destinations in Europe.

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Who’s Who // Business Travel in Japan

Aero Asahi Corporation

The cutting-edge of Japanese aviation

Tel

03-3522-0646

Contact Person: Mr. Shimojima Email

info-air@aeroasahi.co.jp

Web site

www.aeroasahi.co.jp

It is surprising that the business and private aviation sector in Japan is not larger. Aero Asahi is an experienced and sophisticated company that has been in the Japanese aviation business for 55 years.

Many industry commentators expect recent changes at Haneda and Narita airports to prompt an expansion of the business aviation sector.

We believe that the time for expansion is now.

Yoshiaki Hata, who oversees Aero Asahi’s jet aviation business, says: “Aero Asahi is the larger private aviation company in Japan. We also established and began Nagoya’s first FBO (fixed base operator) service. Nagoya is a major Japanese industrial city and the heart of the aerospace sector.

“We strongly recommend not only our business jet and helicopter transportation services, but also our FBO services, to European companies.

“Why don’t you travel in comfort by private jet to Hokkaido or Kyushu? Or how about Kyoto and Hakone in one of our luxurious helicopters?

Let’s enjoy business and travel together. We look forward to meeting you soon!

Christmas night flight available December 23-25th Book Now!

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December 2010

Who’s Who // Business Travel in Japan

Premium Rentacar

Address:

2-8-11 Higashinakanobu, Shinagawa-ku, Tokyo

Tel:

03-3781-8270

Fax:

03-3781-8271

Email:

en-info@premium-rent.com

Web site

www.premium-rent.com/en/

Premium Rentacar not only offers the most luxurious automobiles, but also a wide range of rental cars to meet your highest expectations. Enjoy the luxurious look, feel and spaciousness of the Rolls-Royce Phantom; Bentley Continental Flying Spur; Ferrari F430; Porsche 911 (997); GM Hummer H2; Mercedes-Benz SL500, S500 and Long, S350, CLS500, SLK, E class (w211), C class (current model) and C class (w203); BMW 3 Series (VA20); and Nissan GTR. It’s as simple as registering for a Premium Rentacar membership to make a reservation. Our Tokyo office is open from 09:00-20:00. We welcome enquiries by email at en-info@premium-rent.com

December 2010

53

Who’s Who // Business Travel in Japan

Tokyo MK Co., Ltd.

Taxi Reservation Tel:

03-5547-5551

Taxi Reservation Email:

taxi@tokyomk.com

Limo Reservation Tel:

03-5547-5557

Limo Reservation Email:

hire@tokyomk.com

Web site

www.tokyomk.com

The MK Taxi Group operates over 2,000 limousines, taxis and buses in major metropolitan markets in Japan – Tokyo, Osaka, Kobe, Kyoto, Nagoya, Shiga, Fukuoka, and Sapporo. Luxury-class vehicles (Lexus, MercedesBenz, etc.) are available along with our “Black Taxis”. The chauffeurs – dressed in designer suits, caps and white gloves – speak a foreign language. We are adopting hybrid and clean-diesel vehicles, with 30% of our current Tokyo taxi fleet eco-friendly.

Airport limousines and taxis serve both Narita and Haneda airports at a discounted fixed-price to and from Central Tokyo and vicinity. They are priced approximately 25% less than competitors’ chartered limousine prices and metered taxi fares. Luxury limousine vans with sevenpassenger capacity are available. We also offer discounted fixed-price airport service in limousines for Kyoto and Nagoya, and in Black Cars for Kansai, Itami, Chitose and Centrair airports.

We provide private tours in all markets we serve with an Englishspeaking chauffeur as tour guide. We operate buses with seating capacity of 23-60 passengers for tours of Kyoto, Osaka and Nagoya.

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December 2010

Who’s Who // Business Travel in Japan

Swissôtel Nankai Osaka

Address

5-1-60 Namba, Chuo-ku, Osaka, 542-0076, Japan

Contact

Raymond Tait

Tel

06-6646-1111

Email

osaka@swissotel.com

Web site

www.swissotel.com/osaka (English) www.swissotel-osaka.co.jp (Japanese)

Swissôtel Nankai Osaka is a luxury hotel ideally located in the heart of Namba, Osaka’s most exciting entertainment, shopping and dining district. The hotel sits above Nankai Railway’s Namba Station offering direct train access to Kansai International Airport. All major attractions in Kyoto, Nara and Kobe are within easy reach without changing trains.

The facilities at this 36-storey luxury hotel leave nothing to be desired.

There is a choice of eight restaurants and bars, Amrita Spa & Health Club, indoor swimming pool, 19 banquet/meeting rooms and even three wedding chapels.

The 548 spacious luxurious rooms and suites ensure an unrivaled experience with the ultimate in amenities and in-room technology.

Upgraded amenities for the Executive floors include an Executive Club Lounge.

Swissôtel Nankai Osaka’s signature restaurant, Tavola36 Italian Restaurant & Sky Bar located on the top floor of the hotel, recently unveiled a completely new look. Tavola36 is now Osaka’s latest and most vibrant dining and entertainment venue with an elegant contemporary design that creates an unforgettable “Dining in the Clouds” experience.

December 2010

55

ROBERT WALTERS EMPLOYEE INSIGHT SURVEY 2010 ISSUE

Q. What has your company done to retain its staff in 2010?

IMPROVED WORKING CONDITIONS

INCREASED SALARY/BONUS

ADDITIONAL HOLIDAYS/ BENEFITS

REDUCED WORKING HOURS/ OVERTIME

REINFORCED JOB SECURITY

CONSUMER GOODS

31%

16%

8%

26%

18%

FINANCIAL SERVICES

41%

16%

7%

23%

13%

HEALTHCARE

33%

8%

2%

48%

9%

INFORMATION TECHNOLOGY

37%

20%

7%

26%

10%

MANUFACTURING

42%

17%

4%

26%

10%

MEDIA

51%

11%

0%

29%

9%

SERVICE

38%

8%

5%

36%

14%

OTHER

22%

41%

6%

13%

19%

WORKING ENVIRONMENT A PRIORITY Corporate policies, not remuneration, are the most influential factor for many employees considering changing jobs. When asked what is the main reason to move to a new company, over 51% of respondents felt that an improved working environment would be the most important factor. After a turbulent 2009, many employees are now favoring companies with a record of providing job stability and a focus on training and career progression.

View the latest Robert Walters Employee Insight Survey to receive the views of more than 800 professionals from across Japan on a range of career related issues including remuneration, overseas working, motivation and job searching.

For detailed results, please visit www.robertwalters.co.jp/articles/eurobiz.html

www.robertwalters.co.jp t: +81 (0) 3 4570 1500　f: +81 (0) 3 4570 1599 e: tokyo@robertwalters.co.jp

EUROBIZ ONLINE!

Get

involved Some 300 of the over 2,500 affiliated local European companies and individuals participate directly in one or more of the EBC’s 28 industry committees covering a wide variety of economic sectors.

COMMITTEES

> Aeronautics,

Space & Defence

> Airlines > Animal > Asset

Health

Management

> Automobile > Automotive

Components

> Banking > Business

Aviation

> Business

Continuity Management

> Construction > Cosmetics

Eurobiz.jp is a multimedia online magazine with articles from the magazine, photos, streaming video and a regularly updated blog.

A variety of advertising opportunities are available. Many formats are supported including still, animated, rich media and video. We can even help you develop your own online media campaign.

For more information or to request a media pack contact us on eurobiz@paradigm.co.jp

> Environmental

Technology

Services

> Liquor > Logistics

& Freight

> Materials > Medical

Diagnostics

> Medical

Equipment

> Patents,

Trademarks & Licences

> Railways > Retail

& Wholesale

> Sustainable

Development

> Tax > Telecommunications

Carriers

> Food > Human

> Legal

Resources

> Insurance

> Telecommunications

Equipment

To join the EBC visit

www.ebc-jp.com For more information please contact the EBC Secretariat.

Alison Murray, EBC Executive Director.

Tel: 03-3263-6222. E-mail: ebc@gol.com

Marko Saarelainen Honka Japan Interview Justin McCurry Photo Tony mcnicol

Marko Saarelainen 3 Speaks Finnish, English and Japanese.

3 Business career highlights: Receiving the Minister’s Award of Minister of Land, Infrastructure, Transport and Tourism for Maeda Hospital, the world’s first neurosurgical hospital constructed from logs.

3 Favorite saying: “Try, and you will succeed”.

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December 2010

T alking E U R O bi Z

W

e are a Finnish company and Japan is the first country we exported our log houses to, in 1971.

We were very lucky. A Japanese businessman happened to pass our exhibition near Helsinki and asked the taxi driver to turn back so he could take a closer look.

We had only one house on display but he ended up ordering 400 of them. We were amazed.

Since then we have exported about 5,000 units to Japan. If you are staying at a Japanese ski or golf resort, there’s a good chance you’ll be in a Honka log house. We have also built a range of structures from imported wood, including summer cottages, residential homes, golf clubhouses, coffee shops and even a neurosurgical clinic.

From 1971 to 1991, we were involved mainly in business-to-business projects, such as golf and ski resorts. But in 1991, we established the Japan subsidiary and started to sell to individual customers. The economy was unstable and the business-to-business market had started to decline in the late 1980s. We hadn’t been able to use the Honka name for the business-to-business market in Japan, so entering the individual market allowed us to build our brand image.

Niche business When you are selling 100 houses a year, as we plan to do this year, it’s such a niche business that you are not that affected by economic trends. It’s when you plan to sell 300-400 houses a year, as we did recently, that the loss of business confidence has an impact. It’s much harder to find new distributors under those conditions.

But the main obstacle is our inability to use the results of tests conducted in foreign laboratories. When we want to test the strength of new materials or their resistance to fire, we have to bring all of them to Japan and re-test them here. It costs a lot of money and takes a long time. Fireproof testing a new type of log, for example, costs about ¥10m and takes eight to ten months – and that’s in addition to the tests we have

already done in Finland.

Every time the Japanese government holds a roundtable with the Finnish Embassy or the European Business Council, we stress the need for them to raise this matter.

We have spent the last 20 years pushing for the test requirements to change, but there’s been no progress. The EBC is doing very valuable work on our behalf, and depends on its committee members for ideas and feedback.

The EBC has lots of committees, but its activities would benefit greatly from recruiting new member companies. I have yet to get involved in any committees, but am considering joining the retail & wholesale, construction or building materials committee soon.

Japanese regulations also prevent us from building wooden structures above a certain size: our neurosurgical clinic in Shizuoka prefecture is our biggest. Japan’s regulations are 30 years behind those in Europe and the United States. We’ve been testing our materials for a long time and know that all our buildings, including the bigger ones, are fireproof and earthquake resistant.

Less than 1% The problem is that log buildings are such a minor part of the market in Japan – less than 1% of total building volume comes from log houses – so major housing companies don’t take them seriously.

But if major Japanese house manufacturers were to start a log home business, the situation would change rapidly. The government listens very carefully to those companies, but not to us because we are too small.

Our Nordic pine is a little bit different from Japanese wood – it’s lighter, a little softer, and smells better – so there has always been a lot of demand.

We’ve also benefited from the growth in ecological awareness. Most of our prospective customers have researched our building materials and methods on the internet by the time they come to our exhibitions. They are usually ordinary business people who are aware of environmental issues. The carbon footprint of this product is one of the smallest in the building industry.

Japan’s regulations are 30 years behind those in Europe and the US. We’ve been testing our materials for a long time … all our buildings, including our bigger ones, are fireproof and earthquake resistant

Honka was established in Finland in 1958 by my grandfather and his four brothers. They were farmers, had little money and wanted to start a new business. They came up with the idea of producing log homes using the trees on their land. They bought their own sawmill machines and invented others they couldn’t find on the market, and the business grew quickly from the outset.

I was 18 when I first came to Japan, as an exchange student majoring in Japanese studies at Hokusei University in Hokkaido. After a year I returned to Finland to complete military service. I continued my studies in Finland, but when our firm’s new export manager heard that I could speak a little Japanese, he immediately sent me back to Japan and told me to conduct field research before establishing a subsidiary. And I’m still here more than 20 years later.

I joined the Finnish Chamber of Commerce in Japan when I arrived to launch Honka Japan and I am now the president. When I’m not working I play ice hockey, even though I’m 43.

Our team, Honka Ice Guys, plays in the Yamanashi prefectural league.

I live in a Honka log house in Yamanashi and spend about three days a week in Tokyo. I would like to build a house here, but land is so expensive.

Land prices in Yamanashi are much cheaper. I can see Mount Fuji from my house, which is only a couple of hundred metres from Lake Yamanaka.

December 2010

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Light and Magic

Christmas in Japan may be a pale imitation of Europe’s yuletide, but one area where Tokyo truly shines is its illuminations. From November until early into the new year, whole swathes of the metropolis are dotted with thousands of tiny lights. As Alex Kerr observed: “brightness is a fundamental desire in modern Japan”. Let’s just hope the bulbs are energy-saving.

Photos Miguel Rodriguez

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December 2010

L ens F lair

See all the photographs at www.eurobiz.jp

December 2010

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events

Upcoming events Austrian Business Council

Italian Chamber of Commerce in Japan

www.abc-jpn.org

www.iccj.or.jp

ABC-JAS* ski outing

ICCJ gala dinner & concert

5-6 February, Saturday-Sunday Venue: Okushiga-Kogen, Nagano Fee: TBD (members only) Contact: tokio@advantageaustria.org * Japan Austria Society

14 December, Tuesday, from 19:00 Venue: The Westin Tokyo, Ebisu Fee: ¥20,000 (members), ¥22,000 (non-members) Contact: iccj@iccj.or.jp

British Chamber of Commerce in Japan

Netherlands Chamber of Commerce in Japan http://nccj.jp

www.bccjapan.com

Annual joint chamber bonenkai 10 December, Friday, 18:00-20:00 Venue: Canadian Embassy, 4F, Place Canada Fee: ¥8,000 (members) ¥9,000 (non-members) Contact: info@bccjapan.com

Finnish Chamber of Commerce in Japan www.fcc.or.jp/

FCCJ Christmas luncheon 9 December, Thursday, 12:00-14:00 Venue: Embassy of Finland Fee: ¥7,000 (members only) Contact: fccj@gol.com

FCCJ luncheon meeting

Breakfast meeting 26 January, Wednesday, 8:00-10:00 Speaker: Rudie Filon, Head of Press, Public and Cultural Affairs Section, Delegation of the European Union to Japan Venue: Deshima Lounge, Netherlands Embassy in Japan Fee: TBD Contact: nccj@nccj.jp

NCCJ end of year party 15 December, Wednesday, time to be confirmed Venue: Paradise Macau, Shibuya Fee: to be confirmed Contact: nccj@nccj.jp

24 February, Thursday, 12:00-14:00 Luncheon meeting: lotgenoten, Venue: Hotel Okura partners in circumstance* Speaker: Tsutomu Okuda, Chairman & CEO, J-Front Retailing 23 February, Wednesday, 12:00-14:00 Fee: ¥6,000 (members), ¥8,000 (non-members) Venue: Rabobank & Robeco office, Otemachi Contact: fccj@gol.com Fee: ¥2,000 (members) Contact: nccj@nccj.jp French Chamber of Commerce and * open exchange on challenges in creating Industry in Japan partnerships www.ccifj.or.jp

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Prospects of reforming migration policy in Japan: New proposals*

Swiss Chamber of Commerce and Industry in Japan

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20 December, Monday, 12:30-14:00 Speaker: Yasushi Iguchi, Professor and Dr. of Economics, Director of the Research Institute for Economies with Low Fertility, Kwansei Gakuin University Discussant: Hélène Le Bail, The Research Institute at the French-Japanese House Venue: Maison Franco Japonaise, rm 601 (6F) Fee: free of charge (members & non-members)* Contact: reservation@ccifj.or.jp * Registration deadline: 16 December. Bring own lunch

Japan summit 2010

Generation change in Japan: New leaders, new outlook 16 December, Thursday, 09:00-17:30 Venue: Hotel New Otani Tokyo Fee and contact: www.economistconferences. asia/event/japan-summit-2010

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W ork P lace

Alexis Gresoviac Managing Director, Gameloft K.K. Gameloft provides over 300 games in all genres for downloading to internet-connected devices. “We have the top market share for iPhone games in Japan.�

Photo Tony McNicol

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