True
to the founder Guido Ghiselli a.hardrodt
Like nowhere else – Marunouchi is Tokyo’s new darling Roundtable – Japan’s new energy mix The Kåberger plan – Japan imports experience with renewables GNSS.asia – Cooperation in satellite navigation applications
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2012
THE MAGAZINE OF THE EUROPEAN BUSINESS COUNCIL IN JAPAN / THE EUROPEAN (EU) CHAMBER OF COMMERCE IN JAPAN
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8 Like nowhere else Old Marunouchi district is Tokyo’s new darling By David Umeda
12 GNSS.asia Cooperation in satellite navigation applications By Alena Eckelmann
14 Roundtable Japan’s new energy mix Moderated by Tom O’Sullivan
17 The Kåberger plan Japan imports experience with renewables By David C Hulme 2
October 2012
840 2842 Cover photograph Benjamin Parks
COLUMNS 7 From the Editor
33 Green Biz
39 Upcoming Events
23 Executive Notes
Ethical fashion struts the catwalk. By Alena Eckelmann.
Dan Slater takes a hard look at what really constitutes wealth.
Events for the European business community in Japan.
34 Culture Shock
40 EBC Personality
25 Chamber Voice
The dandelion, Yvan Trousselle and the antique store. By David C Hulme.
Stefan Gustafsson, chairman, the Swedish Chamber of Commerce and Industry in Japan. By David C Hulme.
36 EBC committee schedule
Nicholas Speeks is out to make a mark … with a touch of British humour. By David C Hulme.
28 Investing in Japan Freight-forwarder a.hardrodt is big enough to cover the globe, but small enough to be flexible. By Justin McCurry.
30 In Committee
37 Event Report
42 Lens Flair
Diversity: What’s the point? It’s a business imperative. By David C Hulme.
Steven Herman finds enchanting natural beauty not far from Tokyo.
38 Shop Window
44 Work Place
How apparel retailing formats have diversified. By Roy Larke.
Champion driver Michael Krumm’s work is not the pits.
To increase foreign direct investment, just lower the corporate tax rate. By Geoff Botting.
The Mission of the European Business Council To promote an impediment-free environment for European business in Japan. October 2012
3
Publisher Vickie Paradise Green
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The European (EU) Chamber of Commerce in Japan
Editor-in-chief David C Hulme
The EBC is the trade policy arm of the seventeen European national chambers of commerce and business associations in Japan
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Published by Paradigm 6F West Park Osaki, 3-6-28 Osaki, Shinagawa-ku, Tokyo 141-0032 Tel: 03-5719-4660 Fax: 03-349-1202 www.paradigm.co.jp Published monthly in Tokyo. All rights reserved. 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.
If you prefer not to receive this magazine, and for all matters related to distribution, please send an email to eurobiz@paradigm.co.jp EURObiZ Japan welcomes story ideas from readers and proposals from writers and photographers. Letters to the editor may be edited for length and style.
Big in Japan: iPhone queues – again
Contributors Alena Eckelmann tracks new satellite navigation business, page 12
Alena underwent business training in Tokyo on the Executive Training Programme (ETP), then began to write about business, culture, travel and people in Japan. A researcher
Justin is Tokyo correspondent for The Guardian and The Observer in London, and principal Japan and Korea correspondent for GlobalPost. He also contributes articles to The Christian Science Monitor, The Lancet and other publications, and appears on France 24 TV and BBC radio. “Freight-forwarding company a.hardrodt has been shipping products across the globe for 125 years, yet it didn’t open an office in Japan until the 1970s. This proved an astute move, but during our interview, Guido
Tom O’Sullivan moderates the Energy Roundtable, page 14
Tom, who is from Ireland, has spent most of his professional career in the financial industry. More recently he has dedicated himself to energy consulting. He intends to play a
at heart and by profession, she enjoys onthe-ground investigation and observation. She contributes articles to magazines and websites in Japan and in Europe. “There has been some surprise that the EU initiated GNSS.asia to share the Galileo experience and to collaborate with downstream industries, and some doubt that Japan would do the same with the QZSS program. Asia has been marked as a GNSS hotspot, and the opportunities are up for grabs for early movers!”
Justin McCurry visits Guido Ghiselli at a.hardrodt, page 28
Ghiselli, the a.hardrodt’s Italian managing director in Tokyo, issued a familiar warning: Japan must dismantle its trade barriers or risk becoming an also-ran.”
key role in shaping the sustainable-energy future of Japan and its Asian neighbours. A chartered accountant and civil engineer, Tom is married and has two sons. “Moderating the energy roundtable was a very interesting opportunity at this critical juncture in Japan’s energy discussions. European companies should play a critical role in helping Japan to meet its energy needs. The roundtable underlined the commitment of the EU business community to fulfilling this role.”
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F rom the E ditor
Phew! With the harshest glare of summer now past, Japan seems to have dodged a bullet. It was a close thing, with some of the major energy producers coming perilously near to exceeding full capacity, but there were no crippling, largescale or extended blackouts. We may breathe a sigh of relief, but the urgency of re-ordering Japan’s energy mix does not diminish. Decisions taken over the coming months and years will determine whether or not this nation has energy supplies that are sufficient, safe, sustainable and affordable. Japanese consumers and businesses are the primary stakeholders in these decisions, but energy-related industries the world over will be deeply interested, and some will become heavily involved. Some of the European companies most keenly engaged in this issue were represented at the EURObiZ Japan Energy Roundtable (page 14). The participants represented a wonderfully
diverse range of opinion. Areva wants Japan to keep nuclear energy as a significant part of its energy mix. Total represents the oil and gas industry. The priority for ABB is integration of renewable energy into Japan’s transmission and distribution system. Siemens Japan’s energy sector covers wind power, oil and gas, as well as power transmission. Schneider Electric specialises in innovative energy-efficiency solutions. They were never going to agree entirely. Tomas Kåberger, who heads the recently established, and selfexplanatory, Japan Renewable Energy Foundation, kindly agreed to join this group, making the conversation even livelier. Having headed Sweden’s charge into renewables (the nation has already met the EU targets for 2020), Kåberger brings valuable experience and expertise to the tough energy-related problems that Japan must solve quite soon. See page 17 for more of his insights. What roundtable participants all
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agreed on is that, whichever direction Japan goes with its energy-equation goals, European companies can expect to provide increasing amounts of equipment, services and advice. Japan simply lacks the wherewithal for the task, and it seems unimaginable that the nation’s leaders will ignore the imperative of opening its energy sector to competition. There is enough historical precedent for the sceptics, but Japan has also shown that it can turn on a dime in the face of crisis. As soon as it does – thus improving its economic resilience and sustainability, and its global competitiveness – we can all breathe another big sigh of relief.
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hulme@paradigm.co.jp
Like nowhere else B
Old Marunouchi district is the new darling of Tokyo Text david umeda
lending the best of the old and new is Tokyo station. Nearly a century of history defines this landmark of the capital’s business district, located a few blocks from the Imperial Palace, the centre of power from the 17th to the mid-20th centuries. “Marunouchi is one of the oldest areas to be developed as a business core, with a number of historical landmark buildings,” explains Mami Matsuyama, head of communications at Saint-Gobain in Japan. “As most buildings are getting old, reconstruction/renovation works have been planned one after another, to give this area a new look.” Historic proportions mark the restoration of Tokyo station completed on 3 June and the re-opening of the
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October 2012
Tokyo Station Hotel on the second to fourth floors exactly four months later. The hotel’s interior was designed by Richmond International and combines European classicism and modernism. Along with six types of guest rooms (the number of which has doubled to 150), there is a guest-only breakfast lounge The Atrium (4F) with a ceiling 9m high and rows of generously sized windows. Second-floor attractions include French restaurant Blanc Rouge, with its wine cellar; the Camellia Bar & Café; and The Bar Oak, with its early 1900s feel. The fitness lounge Jexer Tokyo and training space Urban Cave fitness club (B1) both require membership. SPA TOKINE has special signature Terrake treatments developed by Thalgo of France. There is a business centre and three banquet room options.
The abrasives division of Saint-Gobain provided diamond tools for several large-scale renovation works at Tokyo station. The instruments contributed to the reduction of vibration, noise and dust normally associated with demolition methods – a definite plus in a busy and enclosed jobsite. The patented SG Foam Method was applied to cut off foundations, using only a fraction of the cooling water generally needed. “Saint-Gobain is proud to take part and demonstrate our expertise in such major projects by providing energyefficient and eco-friendly solutions and service,” says Matsuyama. The five-year, ¥50bn renovation project by East Japan Railway encompassed restoring the station’s third floor and roof, which had been damaged by fire from the 1945 bombings. The
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rotundas inside the north and south domes were restored based on original photographs and records discovered in the station’s archives by the owner. The images made it possible to painstakingly reproduce the interior wall reliefs of Chinese Zodiac animals and eagles. The concourses were re-designed to comply with modern functional requirements. Tokyo station was designated an Important National Cultural Asset in 2005, so the original outer walls and other surviving main sections could not be altered, and were repaired to function at the highest degree possible. Kingo Tatsuno designed the original red-brick station building in 1914, applying European-style architecture. His inspiration is said to have come from his studies in London and fondness for the Gothic style of Amsterdam Central
Station that opened in 1889. Tokyo station’s majestic features also embodied sound engineering. The structure did not suffer damage from the 1923 Great Kanto Earthquake, despite much of the city being levelled. Following the 1945 bombing raids, the building was closed for repairs from 1945 to 1951, but the third storey remained closed until the current restoration. Most of the new roof slate comes from tsunamihit Miyagi prefecture. A company in the devastated north-east was able to salvage the slate in good condition from its flooded warehouse. MAG-ISOVER, part of the Saint-Gobain group, specialises in glass wool products used extensively in the Marunouchi district, according to Maiko Yamaguchi, deputy communication manager at MAG-ISOVER. Glass wool products are used under floating floors, to insulate air-conditioning ducts, as acoustic absorption material for mechanical rooms and to fireproof partition walls. “The company provided glass wool products for the renovated Tokyo station and nearly all the buildings nearby,” Yamaguchi explains. Also opening in October are the Tokyo Station Gallery, featuring paintings and other artwork, and an expanded outdoor plaza on the Marunouchi side, connecting pedestrian traffic to the surrounding mixed-use skyscrapers. Another piece of history The Mitsubishi Ichigokan Museum (opened 2010), with 20 exhibition rooms and an art facility for cultural
exchanges, preserves its original 19th-century architecture even though joined to the modern Marunouchi Park Building (2009) rising 35 storeys above. The museum’s permanent collection includes 250 works of graphic art originally owned by Toulouse-Lautrec (1864-1901). Across the green plaza is Marunouchi Brick Square (2009), housing 36 shops and restaurants. Down the road is Tokyo International Forum (TIF), a glass palace rising 11 storeys and considered the capital’s first convention and art centre. The TIF is four buildings rolled into one, sharing an airy glass-roof atrium. Facilities include seven halls of various sizes, an exhibition hall and 34 conference rooms. Five cafés and eight restaurants – and a spacious plaza running through the middle – provide refreshing rest spots. Across the way is Tokia Tokyo Building. Restaurants on both sides of the second and third floors are accessible by softly lit ramps, with dining also in the first basement and on the ground floor. Marunouchi Naka Dori runs northsouth between the outer Babasaki moat of the Imperial Palace and Tokyo Station. The beautifully tree-lined, cobblestone avenue has benches and notable art pieces. From mid-November to midFebruary, 850,000 LED lights in the trees illuminate the avenue. Not identical twins One of the earliest signs of urban revitalisation was the Marunouchi Building (2004), across from Tokyo Station. The “Maru Biru” makes a leisurely stroll as
October 2012
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FOCUS
Marunouchi is going through a two-decade redevelopment … drastically modernising the whole district
enjoyable indoors as down the district’s chic sidewalks, with shops and 60 dining establishments from the first basement to the sixth floor, and on the top two floors. You’re never out of touch with the sunlight or moonbeams, with large windows offering views of the cityscape, including an observation deck for Tokyo station. Connected by an underground passageway is the black-glassed ShinMarunouchi Building (2007) at 198m, about a meter taller than its “twin”. On four levels (B1-3F) are 80 shops and restaurants. The banks of escalators next to each other allow space for rest areas with sofas. Permasteelisa Japan was the curtain wall subcontractor for the ShinMarunouchi Building and the JP Tower, under construction companies Takenaka Corporation and Taisei Corporation, respectively. Permasteelisa Japan provided to the general contractors its
David Umeda
Naka Dori
Paddy o’connor
The Atrium, The Tokyo Station Hotel
Guido Tarchi, Permasteelisa Japan
The Tokyo station hotel
Tokyo International Forum
typical package covering all phases – from the development of the engineering solution in collaboration with each building project team, to supply of the curtain wall and the installation onsite. “Marunouchi is going through a two-decade redevelopment plan that started in the late 1990s, which is drastically modernising the whole district up to Otemachi,” says Guido Tarchi, representative director at Permasteelisa Japan. “The transformation does not consist in only rebuilding the old structures, but also offering a different social significance to the location. The birth of major shopping centres and the consequent influx of visitors after office hours is a tangible sign of this.” Part of the plan Saint-Gobain Japan also manufactures, distributes and carries out research in the flat-glass and high-performance materials sectors, in fields as diverse as
glass, refractories and abrasives. The French company subsidiary has supplied its sgg Diamant extra-clear glass for the 700m² Swedish fast-fashion H&M store, which opened in September, right next to Tokyo Station. Its proprietary fire-resistant safety glass, sgg Pyroswiss, has been installed at the BNP Paribas offices on the 39th to 42nd floors of the 200m-tall GranTokyo North Tower in the Yaesu exit area of Tokyo Station City and other sites. “Marunouchi is a unique district in which we have been very pleased, and proud, to become involved.” explains Philippe Schwindenhammer, president of Saint-Gobain Japan. “The architecture, the location, the types of buildings, and the challenges of the constructions are simply exceptional. I have to say, [this is] one of my favourite places to bring visitors to show them what is going on in Japan in terms of architecture.” October 2012
11
GNSS.asia Cooperation in satellite navigation applications Text ALENA ECKELMANN
G
lobal navigation satellite systems (GNSS) are bringing about R&D collaboration and industrial partnerships between nations, with joint development of a wide range of beneficial civilian applications. This is not just wishful thinking, but makes perfect economic sense. The global markets for GNSS chipsets (core market) and devices (enabled market) continue to grow rapidly. The GNSS.asia project is an initiative to encourage such collaboration. It aims to support globalisation of Europe’s Galileo satellite navigation system by developing and implementing cooperation between developers of receivers and applications in the EU and in Japan, South Korea, China, Taiwan and India. Launched at the beginning of this year and financed under the 7th EU Framework Programme, or FP7, the 30-month project has a budget of €1.2 million, out of which €180,000 are planned for GNSS-related activities in Japan. “The goal is to implement concrete actions which will pave the way for a steady and consistent EU-Japan engagement in satellite navigation development,” according to Silviu Jora. Besides being general manager of the EU-Japan Centre for Industrial Cooperation in Tokyo, among other responsibilities, he is the contact point and coordinator of the GNSS.asia project in Japan. Currently being built at a cost of €20 billion, Galileo aims to
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October 2012
There are some wellknown players in the European GNSS industry, but we are targeting the unknown companies Silviu Jora, GNSS.asia project provide a guaranteed global positioning service for EU nations in order to ensure independence from existing systems, including the United States’ GPS (operating since 1994) and Russia’s GLONASS (in civilian use since 2007). In October 2011 the first two European Galileo satellites were launched, with another two scheduled for this month. The first Galileo signals will be available by the end of the year, and the complete Galileo constellation of 27 satellites is set to be fully operational by 2020. Both Galileo and GNSS. asia are managed by the European Commission Directorate General (ECDG) for Enterprise and Industry, ensuring that they are under civilian control and will be used primarily for civilian purposes. Japan, China and India are also developing their own navigation satellite systems, all to be operational in the next
F ocus
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few years. Japan’s Quasi-Zenith Satellite System (QZSS), for example, is based on a planned constellation of seven satellites covering a north-south corridor above the Pacific Ocean. It will be compatible with, and enhance the accuracy of, the existing GPS and GLONASS. EU officials also hope QZSS will be interoperable with Galileo. “The EU-Japan Centre is well placed to define a strategy for GNSS cooperation, promote Galileo awareness in the Japanese GNSS community, and ensure the valorisation of Galileo in Japan by joint development of exportable products in the downstream sectors of receivers and applications,” explains Jora. Researchers have identified Asia as a hotspot of multiGNSS activities. The high density of satellite coverage over the region brings significant advantages to regional industries and consumers. As early as 2008, Prof Akio Yasuda of the GPS Society of the Japan Institute of Navigation suggested that “the AsiaOceania region is the best place to receive the earliest benefit from this new multi-GNSS era”. Asia contains the manufacturing hubs of the global GNSS downstream industry, producing almost all current mobile handsets and navigation devices. Japan in particular is an industrial and science/technology powerhouse with a welldeveloped space industry and a highly advanced GNSS-related sector. “Many Japanese firms have been early adopters of GPS and have thus developed 20-plus years of experience in building and running navigation systems, particularly for car navigation and maritime shipping,” says Germany-based Rainer Horn, managing partner of SpaceTec Capital Partners and project coordinator of GNSS.asia. While many mobile networks and electricity network systems in Japan are now synchronised using GPS signals, with Galileo in place Japanese firms will have a wider choice of satellites on which to base their systems, both for export as well as for domestic use. Since 2005, Google Earth and the sectors of car navigation and smartphone navigation have propelled civilian GNSS beyond specialist circles and opened a much wider market. “Satellite navigation has become a valuable tool for nearly all economic sectors. Keeping track of where you are will be as important as knowing the time of day,” states Jora. There are a great number of potential applications for civil society, and the most promising in terms of revenues currently are road navigation and location-based services. “Very important in the context of Japan at the moment are search-and-rescue and disaster-management applications such as tsunami monitoring, landslide monitoring, meteorology and emergency-message management,” Jora points out. Large Japanese companies that manufacture car navigation systems, such as Mitsubishi Electric, Sony, Pioneer, Panasonic and Fujitsu, are famous for their sophisticated technology. However, with high manufacturing costs in Japan, they are considering how to remain competitive around the world. “They don’t really mind which GNSS system they are using, as long as it works and is cheap. What they now look for is a multi-GNSS system that can receive GPS, QZSS and Galileo
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signals with one receiver,” says Kiyoshi Yajima, a receiver-technology engineer at GPS and GNSS specialist firm Lighthouse Technology and Consulting. Yajima is also the Japan expert on the GNSS.asia project team in Japan. Promoting the GNSS.asia project to small to medium-sized enterprises (SMEs) in Europe and to venture companies in Japan is a high priority. SMEs account for 99% of companies in Europe, but they need some technical support in order to globalise. “There are some well-known players in the European GNSS industry, but we are targeting the unknown companies. There is an entire ecosystem of high-tech, high-growth SMEs in Europe that are ideal cooperation partners for Japanese companies in the area of software applications,” says Jora. “The GNSS.asia project is highly opportune in terms of early dissemination for the potential users and business developers interested in the novelty of the system, and in early positioning in a very promising market,” Jora adds. Similarly, venture companies in Japan market high-value, sophisticated products, but they need help to find international partners. “Car navigation is now shifting from the receiver applications to smartphones, and very small companies can develop these applications. This is a big market for venture companies in Japan, and GNSS.asia can help these firms collaborate with EU partners,” states Yajima. Country teams at GNSS.asia are sounding out opportunities, and are to prepare proposals for their respective markets – each containing several potential projects. GNSS.asia in Brussels will select the most promising candidates for implementation. “We look for joint collaboration projects that are feasible and achievable within the duration of GNSS.asia, and we are totally open to what pilot projects will be proposed,” says Horn.
October 2012
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Roundtable:
Japan’s new energy mix Date: 3 September 2012 Moderator TOM O’SULLIVAN Photos BENJAMIN PARKS
As the Japanese government prepared to announce a new basic energy plan for Japan in the aftermath of the accident at the Fukushima Daiichi Nuclear Power Plant triggered on 3 March 2011, EURObiZ Japan invited six experts to discuss key aspects of the energy issue in which they are actively engaged. Joining the discussion were Luigi Colantuoni, North-East Asia chief representative for Total; Ken’ichi Fujita, energy sector, senior executive operating officer for Siemens Japan; Serge Goldenberg, Japan country president for Schneider Electric; Tomas Kåberger, executive board chairman of the Japan Renewable Energy Foundation (JREF); Armand Laferrère, president of Areva Japan; and Frenk Withoos, vice-president of the power products and systems division at ABB. The wide-ranging topics covered in the discussion include technology, costs and market access. 14
October 2012
roundtable
EURObiZ: What do each of you see as the state of the energy debate in Japan? Ken’ichi Fujita: I am encouraged by the recent discussions, particularly involving several government organisations and the electric power companies, around the options for energy production, particularly combined-cycle electricity generation, to satisfy middle-load electricity demand. Serge Goldenberg: There is still tremendous potential around power-saving initiatives, which should help to inform those involved in the discussions about which power-generation technologies to adopt. Luigi Colantuoni: The cost of energy production must be key to ongoing discussions, and care must be taken to ensure full transparency as the options are debated. The levelised cost of electricity [the price at which electricity must be generated from a specific source to break even over the lifetime of the project] has to be considered in order to make comparisons of the real
Frenk Withoos
Serge Goldenberg
Tomas Kåberger
Ken’ichi Fujita
Armand Laferrère
Luigi Colantuoni
costs of electricity generated from various sources. Frenk Withoos: I believe that the zero-nuclear option may be the policy framework adopted by the Japanese government, and that the crisis offers Japan a unique opportunity to restructure its power sector. Costs should be a key consideration of the debate as it evolves. Armand Laferrère: It is realistic to expect 15% reliance on nuclear power to be achieved by 2030, but discussions around what may happen by 2050 do not make much sense. It is too difficult to predict at this point. Even so, ensuring continuing returns on the significant investments that have already been made will be important. Tomas Kåberger: The short-term scenario is important, as changing circumstances will influence future decisions. Ensuring that the right industry structure is adopted up-front for the electricity sector will be key. Right now, Japan’s regional power monopolies are terribly inefficient. It is vital to establish
a national distribution grid and to ensure fair access for all power generators. There should also be an independent regulator. Sweden represents a good example of how renewables and biofuels can power the electricity and transport sectors. What financing and cost considerations are associated with the various technological solutions being proposed? Fujita: Up to 45% of the Japanese population have expressed reservations about the continuation of nuclear power generation. I am encouraged by the involvement of private-sector finance to date. However, there is still a risk of blackouts due to low levels of reserves at several of the electric power companies. Goldenberg: Potential energy savings may amount to 20-30% of current demand. The investment required to generate this level of savings may be considerably less than the costs associated with building additional powergeneration capacity. Creation of the
October 2012
15
appropriate incentives and legislation will be key to ensuring that this investment happens. These energy savings should apply to the industrial sector as well as the building sector. Additionally, considering the reinforcement of investments in renewable energy that demands intelligent monitoring of supply and demand, investments in smart grid initiatives will be crucial to supporting an energy-efficiency roadmap. European companies seem to be more advanced in areas such as the software for smart-grid technologies. This should encourage partnerships to accelerate energy savings in Japan. Colantuoni: Complementary power sources [to renewable energy], especially gas-fired power plants, are necessary. The focus should be on security. If there is a crisis in the Middle East, oil prices would go up so fast that Japan would restart its nuclear reactors very soon. Also, natural gas in Japan and South Korea is acquired under long-term contracts indexed to oil prices. Currently, Japanese authorities are
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October 2012
concerned by the deterioration of the trade balance due to record-high imports of LNG [liquefied natural gas] and are aiming at reduction of LNG prices in the Far East. That is quite a challenge, as new LNG projects are increasingly expensive. Withoos: Access for European companies in the power-bidding processes will be important. Japan should exploit the experience of EU companies that have world-class capabilities in energy and power deployment. Laferrère: A new Nuclear Regulatory Commission [NRC] will be appointed later this month [September] that will oversee the nuclear power industry in Japan. Reactors such as [in] Shimane, which are approaching completion, ought to be brought on-line by the NRC. Commercial opportunities should continue in nuclear-fuel procurement, fuel recycling and re-starts. The recycling and/or storage of nuclear waste is an area where further discussion and decisions will be necessary. Given Japan’s unique seismic circumstances, the waste disposal issue is more complex
here than in other countries. I continue to be concerned about the financial viability of the electric power companies. KĂĽberger: High prices and the poor state of the grid are significant current concerns. To help create a national power grid, underwater power cables could quickly link the nuclear power plants, as a short-term option. I am concerned about the long-term health impacts of the accident at Fukushima. This merits close attention in the years ahead. European companies with the appropriate competencies should be given fair access to ensure that best-inclass global technologies are adopted, and electricity prices for residential, industrial and commercial users are reduced. Consideration should be given to importing power from regional East Asian neighbors, as is done in other regions of the world. I am very optimistic and excited about the growth potential for renewables, given the historical experience in other countries where growth rates may have been underestimated by a factor of 20.
roundtable special
The Kåberger plan Japan imports experience with renewables Text DAVID C HULME Photo benjamin parks
“The challenge facing Japan after the Fukushima accident is enormous, difficult and important, not only for Japan but also for industrial development in the rest of the world,” says Tomas Kåberger, executive board chairman of the Japan Renewable Energy Foundation (JREF), established in September last year by Masayoshi Son, founder of mobile carrier SoftBank and a leader in the eco-movement in Japan. In order to accept Son’s request to head the foundation, Kåberger resigned as
director general of the Swedish Energy Agency, but he remains committed to an impressive range of roles in academia and industry in various countries. Trained as an engineering physicist, he expanded the scope of his expertise to include the financial aspect of the energy industry as well as policy formation. With a JREF budget of ¥1 billion, to be spent over five years, he hopes to have a significant impact. Kåberger describes the mission of JREF as to introduce international
experience to Japan and apply whatever is relevant, so that Japanese industry and policymakers can benefit from mistakes and successes in other parts of the world, and to use experience gathered within Japan to further develop the renewable energy sector here. It is a major opportunity, he adds. “We clearly see that the baseline in Japan is really bad, with high costs and high prices for electricity supply – at the same time as the sustainability of the historical electricity system is poor,”
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he says. “So, both the economics and competitiveness of the industry can be greatly improved.” One of the first activities is to help people in Japan’s renewable energy industry meet with their international peers. This is done by organising international conferences, seminars and study tours.
If you are going to give [power companies] several hundred billion yen, you make it a condition that they hand over the transmission grid Kåberger agrees that increasing the nation’s solar photovoltaic capacity is a feasible short-term strategy. “That is simple, from a planning point of view, and can be done without significant reregulation,” he says. “The potential of biomass wastes for electricity and heat production, solar water heating, wind energy and geothermal energy is also very significant, it takes longer to plan and to get plants into operation.” One serious problem, he adds, is an underdeveloped institutional environment. “We know from Europe that getting investment moving is not just a matter of industrial learning. It is also a matter of having authorities who know how to handle applications [to build power plants] and get the relevant legislation into place,” he explains. For example, Japan’s current legislative framework is not suited to developing district heating grids, with pipelines beneath cities, which would be a necessary part of utilising heat from biomass plants. JREF, says Kåberger, is prepared to address the problem of administrative bottlenecks, and recognises that the issue is complex even in the best of circumstances. “You have to do it by trial and error
to discover how legislation will work in practice,” he says, adding that it will take years to develop legislation that is effective and fair. While not outspoken regarding geothermal energy, Kåberger sees this alternate energy source as a significant potential resource inside Japan, with Iceland as a good example of what can be done. “They have managed to develop electrical production from geothermal resources at very low cost and with very small negative environmental consequences,” he says. While owners of hot springs resorts in Japan tend to be wary of plans to tap underground heat, a large geothermal power station outside the Icelandic capital of Reykjavik, with the hot baths that its water feeds, has become a major tourist attraction. Geothermal resources could be developed with similar benefits in Japan, Kåberger says. Regarding the development of a national power grid, the JREF head notes that Japan’s large-scale users of electricity are awakening to the fact that they are overpaying for poor management and inefficiency. With the power companies expected to be lining up for taxpayer bailouts, he says, this translates into a unique opportunity for the government to take control of distribution. “If you are going to give them several hundred billion yen, you make it a condition that they hand over the transmission grid,” he says. When it comes to efficiency of energy production and distribution, Kåberger does not like the term “smart grid”. “I try hard to avoid using the term, because not everybody agrees on what it means,” he explains. “What Japan needs is a stronger electricity grid, so that exchanges between regions could work smoothly. That would reduce the cost of generation as well as the unnecessary cost of spare local capacity.” It would also allow for increased competition, with a spot market for electricity so that users can shift their consumption from periods of high cost to periods of low cost, with multiple
benefits for the economy. As an example, Kåberger cites the anticipated development of electric vehicles, with significant combined battery capacity. “Potentially, hundreds of thousands of cars can be recharged when production is cheap. Then, these batteries may be used to supply power back to the grid if there are periods of extremely high power prices,” he says, noting that the Japanese car industry is developing the related technologies. “So Japan should be an early adopter of these opportunities, if the regulatory system allows it.” A drawback of solar and wind energy is that supply is not constant. However, Kåberger points out: “When the sun shines and the wind blows, you get periods of very low electricity prices. That makes electric vehicles even more competitive by comparison with fossilfuel vehicles.” For all these reasons, he adds, the government must take control of the power grid. Kåberger does not expect nuclear power to come back into favour. “Now there have been eight reactor core melts globally in about 15,000 reactor operating years, which is 100 or 1,000 times more than theoretical risk analyses have suggested,” he says, adding that this stark contradiction to the expert opinion that allowed nuclear reactors to be built is having a broad effect. “The opinions of financial experts around the world are shifting quite fast,” he says. “Globally, the number of nuclear reactors peaked in 2002, and nuclear power generation peaked in 2006. Since then, both have been declining.” On the demand side of the power equation, much is in Japan’s favour – and not just because of a declining population. By building factories abroad, Japan’s manufacturers have been exporting electricity demand for years. The industries that remain, including sectors in the energy industry, are outdated in terms of energy efficiency. “If you reinvest in energy, you will get more efficient processes,” says Kåberger. October 2012
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industry Voice | Business Continuity Planning
Consequence-based BCP The Tohoku disaster was a spate of incidents, from a M9 earthquake with three quakes over M7 occurring within 45 minutes, numerous aftershocks and a huge tsunami over a wide area, to nuclear accidents triggering radiation contamination, blackouts involving long periods of power shortages, and global supply chain disruptions. As a result, many business continuity plans were not workable as anticipated despite comprehensive manuals being available. The few successful BCPs were the result of ad hoc or flexible measures applied. The word “souteigai” (想定外) – meaning beyond assumptions – was used as an excuse for why a BCP failed. The real reason was because the BCPs prepared for single disaster prevention should an earthquake, tsunami, typhoon or fire strike, based on a historical perspective. Many companies had created plans to offset the impact of a single threat, such as a BCP for an earthquake, or for a novel form of influenza, or possible system outage. When the threat was compounded by multiple incidents happening simultaneously, as was the unfortunate case with the 3/11 Tohoku triple disasters, making workable decisions from several BCPs proved difficult, if not impossible. What has changed since 3/11 in Japan? The nation is moving to the next stage of business continuity management and BCPs. Industries concur that a paradigm
shift to consequence-oriented businesscontinuity action plans regardless of the type of risk is needed. With professional expertise in real business contexts involving BCM at global companies, we have been promoting consequence-based BCPs instead of a threats-oriented approach. Since the beginning of our company in 2007, we have been advising in this way. The new paradigm drops reliance on scenario damage-based action plans, especially plans defined by recovery time objectives as well as plans that operate on hopes, desires (and a prayer). Japanese companies, including small to medium-sized enterprises now realise the need to address global supply chain issues and to improve resilience from not only the Tohoku disasters, but also the Thailand floods. I am confident from a BCP/BCM point of view that Japanese companies will soon become the worldwide model for building a resilient global supply chain, as Japan is recognised as being number one in service and quality control. We have developed the following unique real solutions for effective BCPs with top-tier companies: 1. Emergency transit and lodging arrangements define BCP invocation One click and the system makes it possible to smoothly activate the backup site's operations, evacuate to a safe location the employees and their families,
or send support staff to affected sites. Such arrangements are being co-developed with a travel agent as a cost-effective solution. 2. Emergency provisions for 3 days The Tokyo Metropolitan Government will enforce a new ordinance for comprehensively promoting measures for stranded persons (effective April 2013) and instruct office workers to stay instead of leaving en masse for home. But keeping employees at work facilities requires survival provisions such as drinking water, no-cook foods, and disposable toilets.
“With professional expertise in real business contexts involving BCP at global companies” We developed a nationwide stock of warehouses and a distribution plan to affected areas from multiple nonaffected areas with a logistics company, thereby reducing the total stock provisions at expensive rent spaces. These realistic solutions come from our considerable BCP expertise and long history of providing tailor-made provisions that meet specific company needs.
Yoshihisa Ueda CEO CMA Lab Japan Inc. Tel: 03-3500-1052 (direct) Fax: 03-3500-1053 bizinquiry@cmalab.jp www.cmalab.jp
EXE C UTI V E N OTE S
Really rich
Some things matter more than money
What is wealth today? Take physical money first. I am amazed at the high levels of trust attached to banknotes. I find it miraculous that I can exchange these worthless scraps of yen, renminbi, dollars and pounds for real services and real goods. I say worthless because our currencies are based on trust and nothing else. Yet why we should trust them is a mystery. It is politicians and bankers who back the banknotes, not gold or silver. And I don’t see any real reason to trust our politicians and bankers. Above all, it is the makers of the money, the central banks, who undermine trust. We trust central banks because we think of them as being run by neutral technocrats. And we don’t understand what they do, because it seems so technical. But, at the behest of bankers and politicians, they are buying up rotten financial assets on an increasingly gigantic scale. In Japan, the Bank of Japan has a programme to buy $1 trillion worth of risk assets. It does that by printing money. Central banks are creating a false market for lousy assets. The banks are stuck with the lousy assets, and of course are anxious to get rid of them. How that helps the rest of us, I’m not quite sure. On a recent trip to Hong Kong, seeing aggressive mainland bosses buying designer label products for their young mistresses, I asked myself: Is this wealth? Can the exchange of a devalued currency for a piece of high-priced monogrammed plastic really be the definition of wealth? It reminds me of the joke about the
Soviet Union: the bosses pretend to pay the workers, and the workers pretend to work. Well, the same in Hong Kong: buyers hand over worthless money for basically worthless goods. It’s not even clear who is cheating whom. In contrast, you learn what true wealth means in Japan. True wealth is not having a bunch of weak financial promises in your pocket or in your bank account. It’s being able to wander around 99% of the archipelago knowing that you will not be robbed. It’s about sending your children to school every day on foot, by train or by bus – quite unsupervised. It’s about seeing a policeman stop at every single traffic light as he cycles down a main road. It’s about being able to go into a hospital and be treated fairly and honestly. It’s about not leaving tips in restaurants, but still being treated well. It’s about breathing clean air, because factories, mini-bus drivers and taxis use “green” technology and don’t cheat on their commitments. It’s about politicians who don’t have much power over people’s lives: they are figures of semi-fun, as they should be. It’s about military personnel who help out heroically when they can during civil emergencies, but who look like pleasantly tubby part-timers – certainly in contrast to the pumped-up US soldiers. In other words, the Chinese have been seduced into thinking the ridiculous sports car, the clothes, the perfume, the sunglasses and the prestigious flat constitute wealth. They do not. None of those things can give help if their owner is ever in trouble. The really important
You learn what true wealth means in Japan things are too expensive, even for the super-rich. Can an individual buy clean air? Well, he could move to Alaska, but you can’t buy clean air in Beijing, that’s for sure. Can you buy fresh water? No, you can’t, however many hostesses you pick up in the red light districts of China. Can you personally pay for your father’s life-saving medical operation? Probably not, unless you are really, really rich. The point is that our true wealth resides in institutions that work fairly and competently on our behalf. An honest police force, a decent press, reasonably priced lawyers, a humane health insurance system and a functioning pension system are simply not things you can buy. But they are the most important determinants of your quality of life. People in China think they are rich because they can buy absurd designer goods at absurd prices. In fact, given the absence of everything that is abundant in Japan, the Chinese are really just as poor as they were 20 years ago. In contrast, Japan is not just much richer than China, but is also richer than much of the so-called developed world. Dan Slater Director of the Economist Corporate Network in Tokyo
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Celebration of Love Christmas Premium Shows 2012 The Yokohama Bay Sheraton Hotel and Towers is extending an invitation to EURObiZ Japan readers to join in a special seasonal celebration at their magnificent “Sun” Grand Ballroom on the fifth floor. The 398-room hotel across from Yokohama station will give a ¥2,000 special discount per reader, or ¥6,000 (24th)/¥8,000 (22nd) less per couple for the Christmas Premium Shows 2012 dinner performances. On the 22nd of December, Saturday, the headliners are singers Ms Junko Ohashi and Mr Shigeru Matsuzaki, who will be performing matinee and evening dinner shows. Christmas Eve, the 24th of December, Monday, will feature vocalist Mr Junichi Inagaki and jazz pianist Ms Chihiro Yamanaka in two evening dinner sets. All shows include a reception, dining, and performance. In the spirit of the season, a portion of the proceeds will be going to the Japanese Red Cross Society as part of “Project Loves” – the Great East Japan Earthquake Support by Yokohama Bay Sheraton Hotel and Towers. Chef Masanobu Akami has prepared a Western-style course that includes yuletide favourites, and you can count on the elegant Grand Ballroom to provide an ambience expressing this special season of celebration and good cheer. Ms Ohashi possesses an exceptional singing ability and musicality that continues to dazzle audiences since her debut back in 1974, and will include her big hit “Silhouette Romance”. Mr Matsuzaki is a versatile actor/singer who delivers powerful vocals and a marvellous interpretation of lyrics, such as with his enduring “Memory of Love”. Pop music singer Mr Inagaki is a native of Sendai who includes in his repertoire such best hits as “When Christmas Carols Play”, featured on a TV drama and now a holiday standard, and “Dramatic Rain”. Ms Chihiro, now living in New York, is popular the world over and is critically acclaimed in jazz circles both in Japan and abroad.
Chihiro Yamanaka
Junichi Inagaki
Showtimes 22 December (Saturday), “Sun” Grand Ballroom, 5F Ms Junko Ohashi & Mr Shigeru Matsuzaki Matinee – Reception 11:30, Dining 12:00, Show 13:30Evening – Reception 17:30, Dining 18:00, Show 19:3024 December (Monday), “Sun” Grand Ballroom, 5F Mr Junichi Inagaki & Ms Chihiro Yamanaka Part 1 – Reception 16:00, Dining 16:30, Show 17:30Part 2 – Reception 19:30, Dining 20:00, Show 21:00Banquet reservations 10:00-19:00, Tel: 045-411-1126 Tickets not available through hotel online shop. EURObiZ Japan readers: ¥33,000 per person. ¥62,000 per couple (22nd) ¥26,000 per person. ¥50,000 per couple (24th) Regular Price: ¥35,000 per person. ¥70,000 per couple (22nd) ¥28,000 per person. ¥56,000 per couple (24th) *All seats reserved. Includes fee, tax and service, free drinks, show, variety special dinner course. Tickets will be sent immediately from late
November to early December. SMALL LOGO / 名刺サイズ用 Please note: There will be no overbooking. Non-smoking seating only. Separate room set aside as smoking corner. Use of recording devices, video, cameras, or mobile phones strictly prohibited. Children in elementary school and younger are not allowed. No refund or reissuance should ticket be lost. Recommend use of nearest public transportation to
Junko Ohashi
avoid parking lot congestion on the day. Drinking by driver is prohibited. MEDIUM Shigeru Matsuzaki LOGO / ハーフページ用
Yokohama Bay Sheraton Hotel and Towers, 1-3-23 Kitasaiwai, Nishi-ku, Yokohama 220-8501 Tel: 045-411-1111 Fax: 045-411-1343. www.yokohamabay-sheraton.co.jp LARGE LOGO / フルページ用（A4）
C hamber voice
Stefan Gustafsson Chairman, the Swedish Chamber of Commerce and Industry in Japan www.sccj.org Text and photo David c hulme “It has been a wild and exciting year so far,” says Stefan Gustafsson, chairman of the Swedish Chamber of Commerce and Industry in Japan (SCCJ). “It has been very rewarding for the whole chamber.” Gustafsson is not exaggerating. He assumed the chairmanship in January, just in time to direct preparations for the chamber’s 20th anniversary, celebrated in conjunction with the 2-3 June Sweden Day in Tokyo 2012 at the Swedish Embassy (EURObiZ Japan, July 2012). An extra dimension was added to preparations when the Swedish ambassador, Dr Lars Vargö, suggested a joint embassy/ SCCJ event, along the lines of those he had arranged while posted in South Korea. “Dr Vargö is a very proactive ambassador, who has had a great impact,” says Gustafsson. The decision to hold a joint celebration was taken in February, leaving very little time. On top of that, a visit by Sweden’s King Carl XVI Gustaf and Queen Silvia suddenly materialised. “It was totally wonderful,” says the SCCJ chairman. “We had to ramp up. We joined forces with other groups and brought in an event producer. And we had a tremendous response from sponsors.” The outstanding success of the event is now a matter of record, and can be revisited on the slick SCCJ website, re-launched on 29 June after a major overhaul. Also exciting for the chamber was its relocation in the spring to the embassy building, with furnishings and design provided by Ikea. The generous space includes a meeting room named Älmhult, after the village in southern Sweden where Ikea was born. “Meanwhile, we continued to do all our other regular events,” says Gustafsson, recalling the highly successful joint Nordic chamber event at the beer garden on the 47th floor of St Luke’s Tower the day after the
inauguration of Tokyo’s new skyline feature. “We could see Tokyo Skytree on one side and Tokyo Tower on the other.” Now, with autumn breezes blowing, planning is well advanced for the Scandinavian joint Christmas Party. The chamber offers a wide range of networking and informational events, many in collaboration with other chambers and/or other Swedish organisations. A highlight was the official visit in February of Swedish Minister for Trade Ewa Björling. “She wanted to get a feeling for how Swedish companies are doing here,” says Gustafsson, who is managing director in Japan for global enterprise applications company IFS. He explains that Björling attended a “very interactive” joint SCCJ/ Swedish Trade Council roundtable that included a number of Swedish companies in Japan. “Our mission is very much about promoting business relations between Japan and Sweden, and a lot of that has to do with free trade. The minister represents the view that free trade makes for better living for everyone,” says Gustafsson. The SCCJ chairman explains that, since Sweden’s domestic market is quite limited, corporate survival often means going global. “It is tough to do that if we don’t have free trade.” This is one reason for the SCCJ to actively support the EBC. “We will be looking for more ways to participate in the EBC,” he says. “We want all our members to become more engaged.” As for building business in Japan, says Gustafsson, “Sweden has great brand recognition, and we can develop that.” The chamber’s membership is steady at around 140, with small and mediumsized companies arriving to develop niche opportunities, for example in IT and the medical field. “We have quite a strong, stable position. Certainly better than we might
Sweden has great brand recognition, and we can develop that have feared,” says Gustafsson, who is proud of the way companies such as H&M and Ikea entered the Japanese market, in a “very clever, creative way, and they keep expanding.” Swedish companies, he adds, are adaptable, and the retailers are good at identifying what Japanese consumers want. One advantageous trend, says Gustafsson, is that Japanese companies are moving outward from Japan. “We can support them wherever they go. For Swedish companies, the Japanese market is not limited to Japan,” he says. Even the trend of fewer Japanese youngsters going abroad to study languages can be an advantage, he adds. “One of our members is EF Education, a global company that knows how to take advantage of that trend and increase market share here.” On the outlook for Japan, he says, there is now unprecedented opportunity to change and to progress. “The biggest danger is that they will look inward instead of outward. It is necessary for Japan to create the conditions for businesses to compete. This is not a time to become isolated.” October 2012
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Sweden The link between Japan and Sweden is built on long-lasting business relationships, shared love of technology, and a mutual appreciation of each country’s nurturing of culture. Just the facts Third-largest country in Western Europe Capital: Stockholm Language: Swedish Population: 9.5 million Currency: Swedish krona (SEK) Area: 450,000km2 (174,000mi2) Life expectancy: 79 years (men), 83 years (women) Daylight in Stockholm: 6 hours (Jan), 18 hours (July) Source: www.sweden.se
Japan-Sweden Relations 1868 1880 1904 1907 1957 1992
1997
First treaty between Japan and Sweden signed in Yokohama through Dutch legation Japanese minister to Russia concurrently appointed minister to Sweden First Japanese minister to Sweden assumed post First Swedish minister officially received Both countries raised their legations to status of embassies Swedish Chamber of Commerce and Industry in Japan officially recognised and approved by the then-Japanese Ministry of International Trade and Industry. * European Institute of Japanese Studies established at the Stockholm School of Economics The Institute opened a Tokyo Office The Nobel Prize plays a very important part in the exchanges between both countries. Eighteen Japanese have so far been awarded a Nobel prize.
Sources: www.mofa.go.jp / * www.sccj.org
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Uppsala Stockholm Gothenburg Malmo
S wedish S pecial
Swedish Chamber of Commerce and Industry in Japan Email: office@sccj.org www.sccj.org
Volvo www.volvocars.co.jp
The fundamental task of the Swedish Chamber of Commerce and Industry in Japan is to promote commerce between Japan and Sweden. Members are encouraged to participate in all activities, social as well as business-related, including the participation as a member of the EBC. The chamber works in close cooperation with the Swedish Embassy and the related offices in various ways, thereby promoting the Swedish brand in business and cultural contexts.
Volvo Cars Japan extends its congratulations to the SCCJ in reaching this 20-year milestone! Volvo has a solid position in the Japan marketplace with a worldwide reputation for quality, safety and environmental care. Volvo Cars Japan, established in 1986, operates a strong and dedicated dealer network nationwide. Together with a clear commitment to safety and the environment, we look forward to continue providing the best possible products and experiences.
Sales Institute Japan KK Email: info@sijkk.com www.salesinstitute-japan.com
IFS Japan K.K. Email: info@ifsjapan.co.jp www.ifsworld.com
In today’s increasingly challenging marketplace, optimisation of revenue is a vital objective for every organisation. Sales Institute Japan KK is a global sales training and consulting company, offering comprehensive and customised programmes designed to revolutionise the way your sales force operates and ultimately to increase sales.
IFS develops, supplies and implements IFS Applications™, a componentbased extended ERP suite. IFS focuses on industries where any of four core processes are strategic: service & asset management, manufacturing, supply chain, and projects. The company handles around 2,000 customers and has a presence in some 60 countries worldwide. Sumitomo Shiba Bldg.4, Shiba 2-13-4, Minato-ku, Tokyo 105-0014 Tel: 03-5419-7900 Fax: 03-5419-7909
H&M www.hm.com
Atlas Copco Japan Email: ACKK@jp.atlascopco.com www.atlascopco.co.jp
H&M, which opened its first store in Sweden in 1947, is now represented on more than 44 markets. H&M’s in-house designers create a broad and diverse range for men, women, youth and children. With our brand concept, “fashion and quality at the best price”, H&M makes fashion more accessible to all fashion lovers.
Atlas Copco is an industrial group with world-leading positions in compressors, construction and mining equipment, power tools and assembly systems. The Group delivers sustainable solutions for increased customer productivity, through innovative products and services. In 2012 Atlas Copco celebrates 100 years since its first product launched in Japan, and 2013 marks the Group’s 140th anniversary.
ABB K.K. Email: jpabb.communications@jp.abb.com www.abb.co.jp ABB is a leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impact. The ABB Group of companies operates in around 100 countries and employs about 145,000 people. ABB conducts power and automation business activities in Japan covering areas in manufacturing, sales and service, and involving around 700 employees, two joint ventures, and a sales and service network across 13 cities.
Electrolux www.electrolux.co.jp Electrolux is a global leader in household appliances and appliances for consumer and professional use, selling more than 40 million products in more than 150 markets annually. Electrolux’s thoughtfully designed, innovative solutions are based on extensive consumer research, meeting the desires of consumers and professionals. Electrolux has been active in Japan for more than 20 years and is expanding rapidly its professional and consumer products, in more than 2,000 stores nationwide.
Scandinavia Corporation www.powerlite.co Scandinavia Corporation, established in 1998, is a leading manufacturer of high-quality equipment and products for aesthetics clinics and salons. Our portfolio includes the Powerlite600®PRO series; Powerlite400NE; PowerliteInShape; the skincare product line, SnowWhite; and the Powerlite and Norden Snow Skin Care System. We earned credibility in the industry by offering a full-service range – from customer financing, training to doctor support and after-service – to more than 1,000 salons and clinics in Japan.
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True to the founder a.hardrodt (Japan)
Text JUSTIN MCCURRY Photo BENJAMIN PARKS
I nvesting I n J apan
I
f you buy imported Mozzarella cheese in Tokyo, chances are that Guido Ghiselli, managing director for Japan at a.hartrodt, will have had a hand in its long journey. But as Ghiselli is at pains to point out, the German international freight forwarder’s inventory of cargo extends far beyond fresh dairy produce from his native Italy. The company, which retains the initial and surname of founder Arthur Hartrodt, ships everything from auto parts and industrial machinery to electronic components and pianos. When it was established in Hamburg in 1887, a.hartrodt’s focus was on longdistance trade with Australia and South America, in an age when its flagship would take 83 days to make the trip between Hamburg and Melbourne. Expansion in Europe followed, and the company opened its Japan office in the early 1970s. That move was not, however, part of a meticulously crafted business strategy, but rather the result of an affection for Japan that had gripped one of the company’s managing partners while he was studying at Sophia University’s international campus in Tokyo. Historical connections mean that Australia is still foremost in a.hartrodt’s Asia-Pacific considerations, but the last 20 years have also seen the firm make significant inroads in Singapore, Malaysia and other parts of the region, says Ghiselli. Minor gripes about interminable paperwork and overly punctilious import procedures aside, Ghiselli credits Japan with softening some regulations that once proved a barrier to foreign freight carriers. But he also voices frustration at the local authorities’ ambivalent attitude towards a truly free global market. “South Korea was very enthusiastic and signed a free-trade deal with Europe in the blink of an eye,” he says. “Japan is in discussions, but it could be years before anything happens … and India and other countries will have already cleaned up. I worry about Japan’s ability to cope with the global market. We’re always looking at the government and
other institutions to see if any positive moves are being made in that direction.” Imports comprise about 70% of a.hartrodt’s business with Japan, with exports accounting for the rest. Ghiselli says the amakudari, appointment of retired trade officials, to the boards of firms they once regulated has hampered foreign firms’ progress in the face of domestic freight giants such as Nittsu and Kintetsu. “We are bound to struggle because local freight forwarders always get preference.” Rather than being sucked into futile direct competition with local freight giants that have thousands of employees and can reach every corner of Japan, a.hartrodt emphasises its ability to adapt quickly to clients’ needs by, for example, coordinating the arrival of different products from multiple suppliers to a single recipient in Japan. “That kind of coordination is much easier for us. We can arrange shipment so that the whole process is very smooth,” Ghiselli says. “We don’t see our job as only to meet customers’ requests, but also to continue growing alongside them after a particular job is done. “We are big enough to cover the entire globe, but small enough to be flexible. Our Japanese competitors provide a good service, of course, but it has to be within an institutionalised structure.” The strategy has helped a.hardrodt increase its local workforce from three to 25, says Ghiselli, who joined a.hartrodt in 2009 after 14 years in Tokyo working for an Italian machinery manufacturer. “We have top accounts that comprise a big share of our workload, but overall we’re talking about thousands of accounts,” he says, explaining the firm’s customer base. Much of the growth of the past decade has been driven by the shift in production from Japan to other locations in Asia – that means more semi-finished goods leaving Japan’s shores for Hong Kong, Pusan and Shanghai, rather than for Europe. That shift has strengthened, rather than diminished, Japan’s position in the freight market, Ghiselli says. “It may have shifted a lot of its production overseas, but Japan still holds the purse strings.” The firm’s future will continue to be
We are big enough to cover the entire globe, but small enough to be flexible Guido Ghiselli
shaped by opportunities for growth in the Asia-Pacific, at least while Europe and North America remain recessionprone. “The inter-Asian market is growing in importance,” says Ghiselli. “The eurozone and North America aren’t growing. South America is important, for sure.” As for Japan’s future, he says, much will depend on its ability to rediscover an innovative edge and regain its dynamism as a global export power. “Other countries are moving at light speed, but Japan is moving at the speed of a burning candle,” he says. “And that is at the root of its problems. Mozzarella may comprise only a fraction of a.hartrodt’s cargo, but the cheese shipments go some way towards explaining why the firm has earned the trust of Japan’s famously finicky importers, says Ghiselli. “The product has to leave the factory and arrive at the client’s door within three days. Transporting fresh food and beverages requires special expertise, and that’s what we have.” It is essential, too, he adds, to honour the founder’s emphasis on the human touch – an approach that has brought the firm dividends in Japan. “The company is still family-owned, and the current fourth-generation managers treat business and relations with clients in a direct and personal way,” he says. “This market is evolving, and companies are growing so quickly that the business environment is becoming less personal and human-oriented. “But we’ve found that in the service industry, value comes from people and their expertise. People are the springboard for success.”
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Tax//
For the sake of competitiveness Text GEOFF BOTTING
A
fter a summer of political wrangling, deadlock, and then some more wrangling, Japan is finally headed towards a brave new world of taxation. The politically sensitive consumption tax is scheduled to be hiked from its current 5% to 8% in 2014, then to 10% in 2015. Meanwhile, the corporate tax rate, long having been one of the highest in the world, has been cut by 5 percentage points to 35.6%. (A temporary surcharge will remain in place for three years to fund reconstruction related to the 3/11 triple disaster.) Although the changes come as bitter news to consumers, Japan’s business world welcomes the reform, viewing it as a redress of a tax system that is a legacy of the nation’s high-growth era. Back in the good old days, when Japan’s economy was growing rapidly – and its manufacturers and exporters
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dominated markets around the world – companies here were able to absorb the high corporate tax rate, but the situation has clearly changed for the worse over the past decade and a half. The recordhigh exchange rate of the yen against major currencies continues to cut into exporters’ profits, while aggressive competitors in South Korea, China and elsewhere have emerged to challenge domestic manufacturers head-on. “I think the Japanese government has understood this and has said, ‘We need to do something about it,’ ” says Hans-Peter Musahl, head of the EBC Tax Committee, referring to the corporate tax cut. The revised rate should help Japan become more competitive, he believes. “Companies in Japan need a return on their investments,” says Musahl, “but if their returns are eaten up by a 40% tax rate, maybe investors or financial institutions will be less willing to finance them. That puts the companies at a
disadvantage.” Corporate tax reform has long been the committee’s top issue. It has been calling for the tax to be put in line with international levels of around 25-30%. The new rates still won’t come close to those levels. Even so, tax committee member Christina Lee calls them a “positive step forward”. “Now the question is whether the government will continue on or stop there,” she says. Another big issue for the Tax Committee is the lack of transparency of Japan’s tax authorities. Tax auditors have not been in the habit of explaining their requests, decisions and actions to the affected taxpayers. “If there’s a grey area and if we go to a tax authority to seek advice, my personal observation is that the NTA [National Tax Agency] or the local tax officers are quite hesitant about giving their comments,” says Lee, cluster head of tax at Siemens Japan.
I n C ommittee
The situation has improved somewhat thanks to tax reform in 2008. Taxpayers now have the right to seek written clarification of specific transactions in official rulings, known as bunsho kaito. “I think the lawmakers have responded to the calls for more transparency, for more taxpayers’ rights. So on paper, we do see an improvement,” says Musahl, a partner at Ernst & Young Shin Nihon Tax. “But the question – and the answer can only be known in the coming months and years – is whether the day-to-day tax administration will bring out more rights. Will it really bring out more transparency?” Lee notes that Japanese authorities may suddenly request information at the late stages of an audit, for example, which creates time pressure and uncertainty for the company. “From a foreign investor’s point of view, we need to have some certainty about the local tax environment. With tax audits, I think we can say that there
Tax Committee Key advocacy issues k Corporate tax rate – The corporate tax rate should be lowered to international levels of 25-30% to enhance the competitiveness of companies operating in Japan. k Transparency – The government should create conditions that encourage an open relationship between taxpayers and tax authorities, based on mutual trust. k Carry forward tax losses – Japan’s limited carry-forward period for losses should be made indefinite. is still room for improvement,” she says. As a solution, one of the committee’s proposals has been “horizontal monitoring”, aimed at shifting tax compliance and monitoring from the authorities to the taxpayer. The approach, which has been adopted by Britain and the
We need to have some certainty about the local tax environment Christina Lee, Siemens Japan Netherlands, involves the two sides working as partners, rather than “vertically”, with the ultimate aim of giving taxpayers a greater amount of certainty and transparency. Certainty is especially critical for a foreign company or investor. The overseas head office needs to know clearly, and as far in advance as possible, the size of its tax bill. Not knowing tends to limit the amount of money a foreign company is willing to invest in its Japan operations. Considering the current state of the economy, investment – not to mention efficient tax rules – has never been more important.
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www.azabucourt.com
G reen B iz
Ethical fashion Sustainability struts the catwalk Text Alena Eckelmann
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rganic has conquered the food shelves of supermarkets. Eco has found its way into homes and appliances. Could ethical fashion now take over the clothes racks of Japan’s fashion boutiques and department stores? “Ethical fashion is still a niche market in Japan, but it is not a fading trend. It is a growing philosophy involving lifestyle, communication and creation, and it is part of a fundamental concept of creating a sustainable life in the 21st century,” says fashion journalist Yoshiko Ikoma, former editor-in-chief of the Japanese edition of Marie Claire. There is no standard definition of ethical fashion. The idea includes a host of themes such as natural, organic and sustainable fabrics and dye, eco-fashion, traditional craftsmanship and slow production such as items handmade and locally-made, fair trade, fashion recycling and up-cycling. It is commonly agreed, though, that ethical fashion stands for a minimum impact on the environment and a maximum benefit to people involved in the process of sourcing raw materials, designing and manufacturing clothing and fashion accessories. A share of the ethical fashion niche is alluring, considering that the Japanese overall apparel market is one of the largest in the world, worth ¥8.923 trillion in 2010, according to the Yano Research Institute. Department stores, still the main retail fashion stage in Japan, are eager to develop the theme. “After the Lehman Shock in 2008, and even more after the 3/11 disaster,
they are trying to attract more attention. Japanese consumers are now more interested in ecological and ethical issues, and department stores kindle this interest by putting on related events,” explains Ikoma. Ikoma sees younger consumers – teenagers, students and adults in their twenties – as trend-riders. Internet savvy, well connected through Twitter and Facebook, and often brave enough to take action, they are in search of new concepts. Their needs for products and information are catered to by a breed of young fashionista-cum-social entrepreneurs that she calls “ethical buyers”. Their brands tell the “story” of the fashion items, from producers often based in other parts of Asia or in Africa. One such person is Greenport founder Chie Aoyama, whose concept is an extension of eco-friendly and LOHAS (lifestyle of health and sustainability). “Fashion designers and retailers do not merely sell products anymore, but sell a whole lifestyle. Think of Muji’s success with promoting a lifestyle of simplicity,” says Aoyama. The Kagure select shop in Tokyo’s Omotesando district claims to be the first such retailer to specialise in ethical fashion. Its first store was opened in 2008, and it now operates a boutique in Tokyo’s Marunouchi district, as well as an online shopping site. Kagure is doing well, combining ethical fashion with organic beauty, a yoga lifestyle and vintage craftworks. Celebrity endorsement is important for Japanese consumers. TV talent Satomi Harada, for example, has turned into an ethical fashion coordinator and runs a multi-brand boutique near Nagoya TV Tower in Aichi prefecture.
Ethical fashion is … a growing philosophy involving lifestyle, communication and creation Yoshiko Ikoma Japan’s leading ethical fashion brands, as well as some European designers who target the Japanese ethical fashion market, have a presence on a new online hub, ethicalfashionjapan. com. There are nearly 100 brands listed, including Japan’s leading fair-trade brands People Tree Japan, Hasuna and Shokay, and top organic fashion brands Avanti, Nadell and Motherhouse. Ikoma had been observing fashion trends for over 20 years and regularly visited the big-four overseas Fashion Week events in New York, London, Milan and Paris. “I made the first connection between climate change and a corresponding necessary shift in fashion at the beginning of 2000, but it took some more years before any signs of change were visible on the international catwalks,” she says. In 2004, Paris Fashion Week launched its Ethical Fashion Show, and from 2006 Estethica brought ethical fashion to London Fashion Week. Ethical Fashion Show Berlin premiered in January this year. “In Japan, the ethical fashion movement is growing, but Europe has more advanced ideas and actions. Japanese fashion designers are seeking collaboration with brands and companies there,” says Ikoma. October 2012
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Teeth of the lion Text and photos David C hulme
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C ulture S hock
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he logo of antique shop Dentsdelion is a lion with a dandelion clamped between its jaws. Get it? “My wife and I both love the movie Tampopo [Juzo Itami, 1985], and my wife had a business called Tampopo in California,” says Yvan Trousselle, by way of explanation. So, there you are: tampopo means dandelion, which comes from the French dentsdelion (teeth of the lion). Yvan and Harumi Trousselle opened Dentsdelion in 2003, in Tokyo’s Taito ward, near Akihabara, specialising in antique Imari porcelain. Imari ware is no longer a mainstay of the business, but Trousselle retains a trained eye. “Just a year ago, I watched Tampopo again and discovered something I had never seen before,” he says, and animatedly describes a scene in which homeless people in a park eat food purloined from posh nearby restaurants. “They were eating from 18th-century Imari ware. Amazing! Ten years ago I would not have seen that.” Trousselle’s attraction to Japan began in high school, as teachers presented the country as experiencing an “economic miracle, while preserving its values and culture”. He arrived here in 1986, taught French and worked as a radio anchor for Radio Japan. He married in 1989, and three years later became Tokyo correspondent for Parisbased daily La Croix. Life was good, and life was hectic. “My wife was working full-time and we were both very busy. Eventually, we wanted a change of lifestyle,” he says, “so in 1996 we moved to California.” Japanese antiques, collected over a decade, went with the couple. They purchased a public coin-laundromat, and a year later bought the adjacent dry-cleaning business. Meanwhile, Trousselle had become deeply interested in California’s immigration issues. Utilising library resources at UC Santa Barbara, he earned a PhD in sociology at Université Grenoble 3, Stendhal, producing a dissertation titled “Chicanos in California: Threat or Asset for the United States of the 21st Century.”
He was then ready to return to Japan, to teach (he still teaches French at three Japanese universities) and pursue the persistent dream of opening an antique shop. The timing was perfect. “We sold the two businesses and came back in 2003,” he recalls. “House prices were low, so we bought this marvelous house.” Marvellous indeed! The home of Dentsdelion and its owners is a spacious two-storey structure built of high-quality timber in 1957. It is a rarity in its own right, because at that time timber was strictly rationed. Only because the dwelling would double as a distribution warehouse for the famous Ranman rice wine from Akita prefecture, the owner was able to bring generous amounts of timber from there to Tokyo. The house sets Dentsdelion apart. The display area occupies a larger space than most antique stores. Being a collector, however, did not fully prepare Trousselle for the business of dealing in antiques. “In the beginning, we had no idea how to find things,” he recalls. “We had to crack the antique-trading network.” The network is a system of dealer-only auctions at secret locations. It might be a hotel, a community centre, a temple, a large antique store, or in a shed in the middle of a field. Every item brought to these auctions will change hands. “The hardest part is to get in,” notes Trousselle, who is also fascinated by the wonderful mix of people among the dealers, ranging from owners of venerable Ginza boutiques to country bumpkins bringing wares gleaned from traditional kura storehouses. Attending network meetings means that the scholarly Trousselle now has less time for teaching, but he does not want to give it up altogether. “As much as I enjoy the antiques, it is good to get away from business once in a while,” he says. The family storehouses make Japan a “heaven for antiques”, according to Trousselle. “In the old days, people would buy sets of tableware for a wedding, afterwards using just a few items and
We had no idea how to find things. We had to crack the antique-trading network storing the bulk of it. So you find these items in as-new condition after 300 years,” he explains. Another hallmark of the Japanese market, he says, is the pride that most dealers have in trading at fair value. “French dealers are amazed when I say this,” he relates. “In France, if a dealer can steeply overcharge another dealer, it is something to boast about.” Dentsdelion has had to change with the times. As Japan’s economy continued to struggle and demand for Imari ware softened, it became clear that the shop needed a strategic shift. “Depending only on Japanese customers was not smart. We decided to aim for half [being] foreigners and half Japanese,” says Trousselle, noting that foreigners are more interested in furniture, wall hangings and wooden artifacts. Japanese collectors are attracted by more compact antiques. A professionally built website has helped to almost balance the numbers of Japanese and foreign customers, with most of the latter being European. For this French antique dealer, the business is a stewardship. “When an object changes hands,” he says, “someone looks after it and it continues to live.”
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committee schedule
Upcoming meetings R Animal Health
R Environmental Technology
R Medical Equipment
7 December, Friday, 10:00-, off-site
12 December, Wednesday, 08:30-, EBC
25 October, Thursday, 14:00-, off-site
R Asset Management
R Food
R Tax
22 November, Thursday, 12:00 noon-, EBC
5 December, Wednesday, 09:00-, EBC
14 December, Friday, 12:30-, EBC
R Automotive Components
R Legal Services
11 October, Thursday, 16:00-, EBC
15 November, Thursday, 18:30-, off-site
R Telecommunications Carriers Telecommunications Equipment
R Construction
R Materials
12 November, Monday, 17:00-, EBC
19 November, Monday, 17:30, EBC
13 December, Thursday, 10:00-, EBC
Committee meeting dates are subject to change. Please contact the EBC secretariat for confirmation. Tel: 03-3263-6222. E-mail: ebc@gol.com
EVENT REPORT
Diversity
What’s the Point?
6 September 2012, Mandarin Oriental Tokyo, Linden Room Text and photo david c hulme
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he British Chamber of Commerce in Japan’s Quarterly Question Time for September gave clear answers to the question of what is the point of diversity. Two women with exceptional experience on the topic, Barbara Adachi and Haruno Yoshida, fielded questions from Suzanne Price, founder and director of Price Global, a Tokyo-based change agent specialising in diversity and inclusion. Adachi, based in San Francisco, is Deloitte’s national managing director for human capital. She also held the position of national managing principal for Deloitte’s Women’s Initiative (WIN) in the United States from 2007 until last year, and serves on various boards, including those of Girl Scouts of the USA, the American Heart Association and Forbes Executive Women. Yoshida, appointed president of BT Japan in January, is widely recognised as a role model for the advancement of women in business in Japan. Session moderator Price, prior to founding Price Global, which delivers a variety of diversity and inclusion programmes, spent five years leading the diversity programme for UBS Securities Japan. Adachi began by explaining that she started work as a secretary in an insurance company after working her way through college. She was happy as a secretary, but her boss suggested that she move to sales and offered to teach
Barbara Adachi
her everything she would need to know for that. “He became my first sponsor, and I became the company’s first female salesperson,” said Adachi. She was a working mother, and had six other jobs before joining Deloitte in 1990. She was a senior manager there when the CEO became aware that although fully half the firm’s recruits were women, fewer than 10% of its senior personnel were women. “We found that most of the women who had left the firm were working in other places,” said Adachi. This was interpreted as a vast drain on Deloitte’s resources and an indicator of a serious flaw in its culture. “We saw it as a business imperative,” said Adachi, adding that Deloitte set out to make itself an attractive place for the best men and women to work and to build a career. “We really changed our culture.” Nineteen years later, Deloitte is still aggressively pursuing its goals of diversity and inclusiveness. “We have won a lot of awards and
recognition, but what matters is how our women and our men feel,” said Adachi, who noted that it was crucial to get buy-in from middle-management men, not just top executives. “We can’t have a successful women’s initiative without having the men fully engaged,” she said. For example, WIN events were designed to appeal to men just as strongly as to women. “I always had men on my leadership team. They supported WIN because they benefited from it and because they could appreciate the benefit for their wives or daughters,” said Adachi. Yoshida, who has spent her entire career in the telecommunications industry, had one question when offered the position as head of BT in Japan: Is it really okay to appoint a female to this position in Japan? The answer, she recalled, came without hesitation. “We have an image of what kind of CEO we want there. You fit that image, and you just happen to be female.” “That was exactly what I wanted to hear,” she said. “What women need is equal opportunity, not special treatment.” Another part of what made WIN successful, said Adachi, was sponsorship. “We found that half the women at Deloitte did not have a sponsor or advocate,” she said. “Women struggle with asking for help. We decided to imbed sponsorship in our culture. We explained why you need a sponsor, and how to get one.” October 2012
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SHOP WINDOW
The battle in fashion Apparel market share by format for the top 100 retailers, FY2006-2011 100
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2011 JapanConsuming
Last year was a good one for fashion labels. Overall, apparel retail sales rose 2.3%, with the top 100 retailers enjoying a 3.2% increase. Better revenue performance by the top 100 in recent years has led to ever-greater market concentration. Of a total apparel market of ¥14.221 trillion, according to estimates by JapanConsuming, the top 100 accounted for ¥7.296 trillion in 2011, representing more than a 50% share for the first time. The growth can be attributed to two formats: speciality chains and e-commerce (though some department stores and GMS chains are showing signs of resurgence). It used to be simple. Twenty years ago Japanese shoppers bought basic clothing at supermarkets and splashed out on something a bit special at department stores. The sources of revenue now are as diverse as today’s trends and micro-fashion cultures. Since 2006 alone, as the chart shows, the department store share of the top 100 has fallen from 38% to 27%, a huge decline. Speciality retailing, however, has grown in market share by 10 points, from 38% to 48%. This dominance is set to continue, though the frenetic growth rates of the last decade are now over. Shopping centre developments have peaked as well, meaning fewer new locations into which to expand. Also, competition is increasing, especially from e-commerce. The largest portals – Amazon.com, Rakuten and Zozo (operated by Start Today) – account for a growing chunk of online
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apparel purchases. Zozo defined the market in Japan for e-commerce fashion, but it is Amazon.com that is doing the most to reduce the frictions inherent in buying clothes unseen. By offering free shipping and easy, unconditional returns, this global e-retail site is convincing more and more fashion consumers that there is no risk in buying online. Many Japanese shoppers are discovering that their apartments turn out to be very comfortable fitting rooms, and even better, purchases can be tried on with what’s already in the wardrobe. For European fashion labels, Japanese department stores used to be the main target, but today all channels have potential for boosting sales. Responsive e-commerce sites have the added bonus of being a relatively low-cost tool to test a brand’s presence in what remains one of the largest fashion markets in the world.
Roy Larke JapanConsuming is the leading provider of intelligence on consumer and retail markets in Japan. The monthly report provides news about, and in depth analysis of, current trends.
JC
JapanConsuming
For more information, please see www.japanconsuming.com or contact Sally Bedown at subs@japanconsuming.com
events
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any airlines reduced services to Narita International Airport as European business travellers cancelled trips following the triple disaster of 11 March. But now European airlines are coaxing passengers back to Tokyo. “We are trying slowly and steadily to get the whole business back to normal,” says Jenny Fürstenbach, passenger > Belgian-Luxembourg Chamber of sales manager for Japan at SAS, which Commerce in Japan celebrated 60 years of business in Japan www.blccj.or.jp in April. Annual ball SAS put gala a lot of energy into coun13 November, Tuesday, 18:30-23:00 teracting the negative image of Japan Venue: Conrad Tokyo, Kazanami Ballroom, following revelations of the meltdown Shiodome at the Fukushima nuclear plant. Fee: ¥20,000 “For a long(members), time the ¥25,000 foreign media (non-members) portrayed the image that Japan Contact: info@blccj.or.jp had sunk in the sea, everything was Delighting Customers inshelters,” Japan, radioactive, and we all lived in XI Seminarsays. “So, we realised that Fürstenbach we neededMonday, to help our crew and sales 26 November, 17:00-20:15 staff understand that the situation in Venue: NYK building, Tokyo Tokyo is info@blccj.or.jp quite normal.” Contact: In May and June SAS ran a points > British Chamber of Commerce campaign for travellers looking toin Japan www.bccjapan.com visit Tokyo through the end of 2011. British Business Awards 2012 Members of the SAS EuroBonus mileage program the chance to visit Japan 2 November,have Friday, 18:30-24:00 for 40,000 points forAnnex an economy classor Venue: Conrad Tokyo, 2F, Shimbashi seat on a stations roundtrip basis, compared to Shiodome Fee: standard ¥25,000 (members, non-members) the 80,000 points. Contact: info@bccjapan.com Leisure travellers remain wary about visiting but SAS has seen aand pick > FrenchJapan, Chamber of Commerce upIndustry in business travellers. “That is a good in Japan sign, because if business travellers feel www.ccifj.or.jp safe then leisure travellers will follow,” CCIFJ Annual Fürstenbach says. Gala Party 12 November, Monday, from 18:00 Turkish Airlines set up a special fare Contact: www.ccifj.or.jp in April and May, donating part of the proceeds of ticket prices to the victims CCIFJ joint event with Tokyo of the disaster, according to information Chamber of Commerce on the company’s website. A donation 20 November, Tuesday, from 18:30 of ¥3.9 million was made to the disaster Contact: www.ccifj.or.jp area through the Japanese Red Cross Society. > German Chamber of Commerce and For Lufthansa German Airlines, which Industry in Japan www.japan.ahk.de/en/ celebrated 50 years of doing business in Tokyo in January, the Japanese market Luncheon Meeting: “Tradition, is the second most important interconvalues and innovation – a tinental market after the United States. recipe for success in the global The company intends to focus on Japan economy” during the autumn and winter period, 19 October,attractive Friday, 12:00-14:00 offering prices. Speaker: Dr Karl-Ludwig Kley, Japan Chairman “We want to show that canofbethe Executive Board, Merck KGaA one of the more attractive places when Venue: Hotel Okura Tokyo, South Wing 2F, it comes to cost,” says Otto F. Benz, Maple Room, Toranomon general manager for Japan. Fee: ¥6,000 (members) Contact: events@dihkj.or.jp
Compiled by David Umeda
Lufthansa also organised a oneweek study tour to Japan for about 25 representatives of the German travel industry in early August, allowing decision makers to gather information and get a firsthand impression of the postdisaster situation. “They got a clear picture that Tokyo is a safe place, and that tourists can visit,” Benz says. “It was important they came here because only when the agents are German Wine Festival 2012 convinced Tokyo is safe will they gener23-24 October, Tuesday-Wednesday, 18:30-21:30 (Tokyo) ate new programmes.” 2 November, Friday, 18:30-21:00 (Osaka) For Finnair, 2010 saw Japanese sales Venue: Happo-en, Nuit (Tokyo), Shinsaibashi overtake Finland-based sales, and it Monolith, Osaka is no surprise that the airline aims to Fee: ¥6,000 (each day) boost the number of Japanese leisure Contact: events@dihkj.or.jp passengers visiting Europe. > Ireland Chamber of Commerce Finnair Japan was helped by the fact that, www.ijcc.jp along with Lufthansa, it is one of only two airlines that flyNetworking daily services to Third Thursday Central Japan International Airport 18 October, 15 November, 20 December, Thursday, near Nagoya, and Kansai International 19:00-21:00 Airport secretariat@ijcc.jp near Osaka. Contact: Finnair promotes the shortest flight IJCC Business Dinner times to a numberAwards of regional European 29 November, Thursday, 19:00-23:00 locations where no direct Japan flights Venue: Conrad Shiodome exist, such asTokyo, Manchester. It is also Contact: secretariat@ijcc.jp hoping to cash in on the natural beauty of the polar lights. of Commerce in Japan > Italian Chamber “We compete with other countries www.iccj.or.jp and regions – such as Canada and Gran di Cucina 2012 – Alaska Concorso – for ownership of the aurora, III Edition but this is really something for Japanese people to come and see,” says Sakari National competition open to Romu, sales director Japan. professional chefs and students Opinions differ on when the Japanese 19 November, Monday, from 15:00 market will fully recover. Venue: Hattori Nutrition Yoyogi, Tokyo Romu believes that College, European travelContact: iccj@iccj.or.jp lers are unlikely to return until spring 2012. The Finnair sales director has in > Netherlands Chamber of Commerce advised Japan Japanese tourist authorities to www.nccj.jp conserve all their energies for a market rebound then. 2012 Deshima Business Awards “Next year’s cherry blossom viewing Ceremony and Reception is the next key period for Europeans to 11 October, Thursday, 16:30-19:30 (doors open at 16:00) return,” Romu says. Venue: Gaienmae But TEPIA, SAS’s Fürstenbach is reluctant to Contact: nccj@nccj.jp write off 2011 yet. “ThreeChamber weeks after I arrived inand March > Swiss of Commerce 2010, we experienced Industry in Japan the Icelandic ash www.sccij.jp cloud, and we said ‘Oh! This is not a normal year’,” she says. “2009 wasn’t a SCCIJ 30th Anniversary normal year either as we had the swine Luncheon flu. So, if you start looking at it that way, 10 October, Wednesday, 12:00-14:00 you will never have a normal year. Speaker: Thomas Chairman “TokyoDrhas beenJordan, back to normal of forthe Governing Board, Swiss National Bank some time, and we want to mirror that Venue: Happo-en, Hakuho-kan, Shiroganedai as much as possible,” she adds. station Benz asks a rhetorical Fee:Lufthansa’s ¥8,000 (members and non-members) Contact: info@sccij.jp
question: Is this the country to invest in? And his answer is an unequivocal Yes! “Japan is in a difficult situation, but the trend is positive rather than negative,” Benz says. “European business travellers will return in full by next year.”
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SCCIJ 30th Anniversary Celebration Dinner 11 October, Thursday, 19:00-22:00
Guest of Honour: Federal Councillor Johann N Schneider-Ammann Venue: Westin Tokyo, Kaede Room, Ebisu station Fee: ¥12,000 (members and non-members) Contact: info@sccij.jp
SCCIJ October Luncheon 23 October, Tuesday, 12:00-14:00
Speaker: Ruth Metzler-Arnold, President of Osec Venue: Grand Hyatt Tokyo, 2F, Anise Room Fee: ¥8,000 (members and non-members) Contact: info@sccij.jp
> All-chambers event
European Chambers in Japan Cocktail Party – 3rd edition 18 October, Thursday, 18:30-21:00
Venue: Hyatt Regency Tokyo, Crystal Room, Nishi-Shinjuku Fee: ¥8,000 (chamber members), ¥9,000 (nonmembers) (buffet and drinks)
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Nicholas Speeks Making a mark Text DAVID C HULME Photo Benjamin parks
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E B C personality
N
icholas James Speeks was standing in a light spring rain in Istanbul when his boss phoned from Germany demanding an instant response to the question: “Do you want to go to Japan?” At the time, two-and-a-half years ago, Speeks was CEO of DaimlerChrysler Middle East and Levant, based in Dubai. He jumped at the offer. “Japan is one of our largest markets for passenger cars, and this was something that I had aspired to without really believing that I would get it,” he says. As “preparation”, he reread James Clavell’s “Shogun” and arrived in Tokyo to discover a mood of defensiveness and pessimism. “The company seemed to have accepted the idea of managing inevitable, steady decline,” he says, describing the frustration of having his enthusiasm and new ideas met by passivity and foot-dragging. “I didn’t come here for that and I was having serious difficulty adjusting,” he says. The situation may have continued to deteriorate but for one cataclysmic event – the triple disaster of 3/11. “What I admired was a wonderful stoicism, courage under fire,” Speeks explains. “That was a sea-change for me in my view of Japan. In the wake of the disaster we were agile and innovative. People just got on with it. I saw the strengths and good points of our employees and partners, including a lot of selflessness.” The experience, he adds, helped him curb the impatience and occasional abrasiveness that he had begun to adopt. “I realised that the problems we had were mostly my fault. I learned to accept the Japanese people for who they are, and to adapt to the way things are done here,” he says. Compact and dynamic, dedicated to his German employer, the president and CEO of Mercedes-Benz Japan is a serious man with a thoroughly British sense of humour. “You have to have a sense of humour, or you will come badly unstuck,” he insists. “Perhaps it is an Anglo-Saxon thing, but I find that the more serious things get, the more I tend to see the funny side. My German colleagues don’t always understand that.” Speeks’ career with the German
carmaker has spanned 33 years so far. His first job was on the London eurobond settlement desk of Manufacturers Hanover. The job was enjoyable enough for a 20-year-old, he says, but then one day on the train he overheard a conversation between two jaded and bitter commuters, complaining about the horrors of British Rail service. “I realised that could be me in years to come, so I resigned that day,” he recalls. It was some months later that he landed a job with Daimler-Benz in London, as a sales clerk, at the bottom of the heap. He applied himself to studying German during lunch breaks and was eventually transferred to Germany. He recalls being involved in “interesting projects”, leading to regional responsibility for commercial vehicle sales in the newly developing markets of China and Hong Kong. In June 1990, 11 years after joining the company, he was appointed manager of commercial vehicle sales for Daimler-Benz Services in Iraq. That assignment was short-lived, as Iraq invaded Kuwait on 2 August of that year and foreigners found themselves stranded in the Iraqi capital of Baghdad. When former German Chancellor Willy Brandt came, several harrowing weeks later, to shepherd the German contingent to safety, Speeks faced the unpleasant prospect of being left to await a similar rescue of Baghdad’s British cohort. “Fortunately, it was arranged for me to become an honorary German citizen for about 10 hours,” he says. The Iraq episode helped lead to an assignment as sales manager in Kuwait, and this was followed by postings in Vietnam, Poland and then Dubai. He regards the Vietnam posting, beginning in 1995, as the assignment that had the most impact on him. “First, because I met my wife there, and because, from a business perspective, I failed spectacularly,” he explains. The carmaker had established an assembly plant in the country based on some exaggerated expectations. Even so, Speeks insists that he learned from his own mistakes. “I started out being quite cocky, and did not adequately address myself to the problems,” he says. After Vietnam came Poland, where Speeks (now feeling more mature as a family man) headed a team that he says was full of energy and optimism in a
Do you like natto? Title: President and CEO, MercedesBenz Japan; Chairman of the Board, Japan Automobile Importers Association Time in Japan: “Two-and-a-half years” Career highlight: “Moving the company to invest a lot of money in Iraq when Iraq really needed it” Career regret: “Don’t have any” Favourite saying: “Don’t let the bastards wear you down” Favourite book: “Master and Commander, by Patrick O’Brien” Cannot live without: “Hope” Secret of success in business: “Be an optimist” Do you like natto? “What’s that?” market with genuine potential. “The experience in Poland, in many respects – personally, and professionally – is what made me. It was a great time,” he says. Dubai, the first posting where he was in overall charge, was one with “serious challenges”, including the management of operations in Afghanistan, Pakistan, Lebanon, Syria and Iraq. “In 2006, we were approached by the Americans to see if there was something we could do in terms of investing in Iraq, partly to address employment issues that had security implications,” Speeks says. In other words, more employment would mean fewer terrorist bombings, but the request to go to Iraq was avoided by all but Speeks, who saw it as an exhilarating opportunity. “The chance to be involved in events beyond the normal course of business has always excited me, and I have been fortunate in that respect,” says Speeks, an avid student of military and political history who devours biographies of outstanding leaders. A historical event that Speeks did not volunteer to be involved in was 3/11, but he certainly has no regrets. “I was very glad to be here, standing together with my colleagues to see it through,” he says. “There was no thought of leaving Tokyo.” And now, he adds, Japan has got under his skin.“As CEO of Mercedes-Benz Japan I consider my legacy. What effect will I have on the future direction of the company? What effect will I have on the lives and attitudes of the people I come into contact with?” he says. “I want to leave a mark – on the company, on Japan and on our history here.” October 2012
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Go with the flow Photos and text STEVEN HERMAN
Just a couple of hours north-west of Tokyo, tiny streams of pure, cold water trickle from the heart of Mt Bonoore (棒ノ折山). In a narrow gorge carved out over the ages, summer heat is banished and just a dappling of sunlight filters through a verdant canopy, highlighting cold stone
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and sparkling in the clear stream. Water tumbles over rock in a symphony of endless variation, giving life to mats of moss in almost-luminous green. Day-hikers from Tokyo clamber cautiously downstream, absorbed in the refreshing contrasts with city life.
L ens F lair
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W ork P lace
Michael Krumm Racing driver
Reigning FIA GT1 world champion Michael Krumm first made his mark on racing in 1989, taking first place in the German Formula Ford Championship. “I first came to Japan in 1994, and won the All-Japan Formula Three Championship. The next year I was driving for Toyota,” says Krumm, who now drives for Nissan team NISMO. On race day at Fuji Speedway, at the foot of Mt Fuji, fans linger near the entrance of the pit area just to get a glimpse of him, and he is kept on the run with media and other obligations. “Busy, busy, busy, until I get in the car. Then I am calm,” he says. Photo Iwao Komiya
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leisure and relaxation at PaciďŹ c Islands Club Saipan
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