Journal Name: Asian Business & Management: June 2004, Volume 3, Number 2
Changes in the Market Society and Corporate Social Responsibility (pp151-172)
Kanji Tanimoto (Graduate School of Commerce and Management, Hitotsubashi University)
The role expected of corporations in society is not fixed, but changes when the society forming the basis of the market economy transforms. Since the 1990s, a lively, ongoing debate has occurred as to whether the negative aspects of globalization can be overcome. In the current environment, which demands both social and environmental sustainable development, calls for corporate social responsibility are getting louder. With the growth of green consumerism and socially responsible investments, the evaluation of corporations is being based not only on financial, but also on social, indices. Specialist organizations now survey and rate corporate activities from an environmental-social perspective and provide information to consumers and investors, who in turn make decisions based on this evaluation; corporations thus receive positive or negative sanction from consumers and/or investors based on these ratings. Should this system become established in the marketplace, corporations will have to manifest a system that incorporates social fairness and environmental responsibility, and accept their accountability to stakeholders for their economic activities. This paper examines global trends and new possibilities in corporate responsibility, making a particular study of the current Japanese situation.
Keywords: market society; sustainable development; corporate social responsibility; socially responsible investment; corporate reputation
Boardroom Reform in Japanese Business: An Analysis of the Introduction of the Executive Officer System and its Effects (pp173-199)
Hidetaka Aoki (Faculty of Commerce and Economics, Chiba University of Commerce)
This paper looks at one of the more favoured reforms of top management reforms in the late 1990s, the executive officer system, and investigates both the causes and effects of its introduction. With typical boards of directors facing problems in terms of both the quality of decision-making and the effectiveness of monitoring, high expectations were placed on this system, which separates management and execution. The initial impetus for reform, as will be seen, came about from a drop in business performance and from over-sized boards, but as the system spread, its effectiveness declined. I have been unable to confirm any positive influence on business performance arising from the introduction of the executive officer system. It is therefore suggested that a more helpful approach might be to employ the system in business groups characterized by diversity in their business structure and by the pressures of a high capital market. Furthermore, in investigating whether actual management methods may be a reason for the unsatisfactory results, it appears that, despite claims for the separation of management and execution, high levels of concurrent holding of positions between directors and executive officers indicate that this has not in fact occurred.
Keywords: executive officer system; boardroom reform; corporate governance
Structure of the Japanese Production System: Elusiveness and Reality (pp201-219)
Yoshiji Suzuki (Faculty of Commerce, Doshisha University)
Theories of the Japanese production system (JPS) recognize a definite commonality in the production practices of Japanese companies, with such matters as the quality and productivity of these practices often being explained in terms of the competitive strength of Japanese companies. Various arguments have cast doubt upon the validity of such notions. Toyota special theory argues that it is precisely this special element that is the essence of its own strength, and takes a negative view of JPS approaches that assume these production practices to be common to other Japanese companies. Since the emergence of lean production theories, there has been much keen debate on JPS from various viewpoints, each providing a significant contribution in its own right. However, in terms of a precise understanding of JPS in its entirety, lean production theories, Toyota special theory and indeed various other approaches have generally failed. By demonstrating this point, the present paper seeks to clarify such matters as the kind of production system in terms of which JPS should be understood, the reasons why JPS is difficult to grasp, and indeed whether there is any essential difference between JPS and the Toyota Production System.
Keywords: Japanese Production System; Toyota Production System; JIT; Japanese Work Organization; Jidoka
Remodelling Employment for Competitive Advantage: What will follow Japan's 'Lifetime employment'? (pp221-240)
Sugio Baba (Senshu University)
Since the breakdown of the bubble economy, many people have claimed the breakdown of the seniority system. However, another main pillar of Japanese-style management, long-term, or 'lifetime', employment, has remained almost unchanged. Since these two systems are complementary, some inconsistency must occur when one of them changes. For competitive advantage under global competition, Japanese firms must achieve a dynamic compatibility between strategy and management style, as well as ensure value creation in innovations. This new style must reflect an element of positivity from individual employees. For long-term advantage, the output of the individual must be difficult for competitors to reproduce. In this respect, firms need to develop their own in-house human resources rather than recruit personnel from the external labor market. Such a system would augment the debate on long-term or lifetime employment and answer the demerits of such employment. Where high performers are able to move to other companies, knowledge that could give rise to nonimitability cannot accumulate within a firm. Companies must therefore cultivate a new type of commitment, based on the management of developing an attitude of autonomy or positivity in employees - in other words, empowerment.
Keywords: Japanese-style management; merit system; strategic human resource management; commitment; employment security; labor market
Culture-specific IT Use in Japanese Factories (pp241-262)
Norio Kambayashi (Graduate School of Business Administration, Kobe University)
This paper explores the role that national culture plays in shaping the 'emergent' relationship between information technology (IT) and work organizations. It also shows the mechanisms through which national culture influences workers' IT use. Although a number of previous studies have investigated relationships between IT and organizations, relatively few studies have conducted international comparisons on the theme, and even fewer have focused on national culture in their analytical framework. The present study is based on extensive survey research undertaken with Japanese and British factories, providing empirical evidence about the possibility of cultural influences and their possible implications, and evidence about how such influences operate in reality. The overall analysis of the survey data suggests that the effect of national culture is significant and operates across industry boundaries. The analysis implies that, rather than diversity being eliminated by global IT systems, adaptation to local contexts is likely to remain an important dimension of IT implementation in work organization.
Keywords: Japan; IT use; work organization; national culture; hierarchical control; collectivism
Capital Cost and Financial Policies in Japanese Companies: Some Survey Findings (pp263-276)
Masahiro Akaishi (Business Administration Department, Konan University), Taiji Baba (Business Administration Department, Konan University) and Ikuo Muramatsu (Department of Economics, Shiga University)
Corporate finance theory holds that the cost of equity is the required rate of return of shareholders, and this important concept forms the basis of all decision-making. However, it has been frequently asserted that Japanese companies suppose equity cost to be mere out-of-pocket financing costs. In 1996 we sent a questionnaire to 3000 listed Japanese companies, and, from the findings of this survey, we present here evidence of how Japanese companies perceive the cost of capital, and whether or not these perceptions impact on financial decision-making. We found that the majority of Japanese companies regard equity cost not as the required rate of return to shareholders, but simply as dividends paid. Moreover, we found that this difference was not just one of terminology, but influenced all aspects of financial decision-making. As this survey was conducted in 1996, and since then there have been dramatic changes in the economic climate and system, there may also have been some shift in managerial awareness of Japanese companies; yet it would seem that even today the same tendency persists in Japanese companies, in comparison with Western countries.
Keywords: financial management; finance theory; capital cost; decision-making; dividend policy
(This journal is available online: http://www.palgrave-journals.com/abm)
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