(tentative translation)

Resolution of Annual General Assembly, 1997

Promoting the Process of Reform and Reaching for a Higher Stage of Development

— Our Responsibility and Commitment to Building a Better 21st Century —

May 27, 1997
Keidanren (Japan Federation of Economic Organizations)

The Japanese economy today is progressing along a mild recovery path. At the same time, the abolition and relaxation of regulations is proceeding steadily even as Prime Minister Hashimoto's six-point reform program begins to move forward. Now is the time to accelerate the process of fundamental reform in Japan's socio-economic system and to act with due speed to respond to the globalization of the economy and the parallel trends of the falling birthrate and the aging of society. Indeed, now is the time to take determined action to revitalize and energize the economy.

The business community must resolve to commit itself fully to the process of reform and must undertake a thorough re-examination of all aspects of corporate behavior as measured against the principle of strict self-responsibility and ethical conduct.

Ever mindful of the Keidanren vision expressed in the statement on "Building a Dynamic Internationally-Oriented Nation," we pledge ourselves to becoming fully engaged in coping with the following critical challenges so that we shall be able to pass on a more attractive and vigorous Japan to the next generation which stands to shoulder the fate of this country in the 21st century.


  1. Pursuing fundamental reform in the socio-economic system by supporting the six major reforms.

    In particular, immediate action must be taken in the areas of fiscal structure reform and administrative reform. The government and ruling parties must act to chart the course toward achieving a sound fiscal structure based on the five principles of fiscal structure reform. Specifically, the next three years must be a period of intensive reform during which clearly focused and highly discretionary measures for budgetary curtailment are formulated. Fundamental reform of the medical, national pension and the fiscal investment and loan systems will be of critical importance. Likewise, swift action must be taken to reorganize the central government ministries and to implement the administrative and fiscal reform of local governments in order to create simpler and more efficient government structures on both the national and local levels. Parallel to this, the core functions of the capital should be moved out of Tokyo and relocated as the symbol of a new chapter in Japan's nation-building.

  2. Promoting domestic demand-led economic revitalization through corporate-tax reform, abolition and relaxation of regulations and the early write-off of bad debts.

    It is of vital importance that the high-cost structure of the Japanese economy be rectified. For this purpose, corporate tax rates should be lowered and brought into line with international norms and the abolition and relaxation of regulations should be vigorously pursued. Corporations must act boldly to capitalize on the results of reform and deregulation to create new industries and businesses and to generate new jobs. Effective measures must be taken to accelerate the write-off of bad debts, promote greater liquidity in the real-estate markets and to carry out the reform of the financial system ahead of the original schedule.

  3. Creating a solid foundation for a new round of growth and development in the 21st century.

    The nation's social infrastructure must be upgraded and the development of science and technology must be promoted in order to support a more highly information-intensive society and other newly-emerging needs. In this connection, the business community must adopt a more aggressive stance toward such challenges as upgrading Japan's technology-development capabilities, solving the energy and environmental problems and fostering the development of a new generation of more creative human resources.

  4. Contributing to world peace and prosperity.

    We will take the initiative in buttressing the global free-trade structure by working to ensure that the position and views of the private sector are properly reflected in the World Trade Organization, the Asia-Pacific Economic Cooperation forum and other international organizations. At the same time, we will actively promote private-level diplomacy and endeavor to build a higher level of mutual understanding with the peoples and nations of the world. Similarly, we shall lend our support to economic cooperation in such fields as international investment, technology transfer and human-resource development by working closely with the government and its agencies.

    We pledge ourselves to supporting the Keidanren Global Environment Charter and will commit ourselves to taking an active role in meeting the challenges of global environmental problems. Simultaneously, we will cooperate with non-profit organizations in Japan and overseas to support and to expand the activities for the conservation of the natural environment.

  5. Meeting a higher standard of corporate ethics and enforcing the principle of self-responsibility.

    Japan is in the midst of a transformational process marked by the globalization of the economy and the shifting of the center of gravity from the public to the private sector. Against this background, corporate behavior must be marked by greater transparency and fairness, while corporations must strive to meet a higher standard of ethics and to abide by the principle of self-responsibility. With the interests of consumers and the general public in mind, Keidanren will strongly urge its member companies to observe the principles enunciated in the new Keidanren Charter for Good Corporate Behavior and will continue to appeal to them to become actively engaged in activities that will contribute to society.

In order to more effectively cope with the foregoing challenges, Keidanren will redouble its past efforts to expand and to bolster its policy-making and policy-promoting initiatives through the activities of its various committees. For this purpose, Keidanren will fully utilize the research undertaken by our newly formed 21st Century Public Policy Institute.

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