- The Board of Councillors Chair, Vice Chairs, and Secretariat Executive Appointments
- Middle East Situation
- Japan-U.S. Summit
- Wage Increases
- National Council on Social Security
- Selective Separate Surnames for Married Couples
- Comprehensive Review of Work Style Reform
- Prime Minister Takaichi's Distribution of Catalog Gifts
The Board of Councillors Chair, Vice Chairs, and Secretariat Executive Appointments
Today's meeting of the Chairman and Vice Chairs selected candidates to be newly appointed as Chair and Vice Chairs of the Board of Councillors and secretariat executives at the General Assembly on June 3.
At the General Assembly, with the expiration of their terms, the Board of Councillors Chair Tetsuro Tomita, Vice Chairs Tatsuro Kosaka, Tsugio Mitsuoka, Keiji Nishizawa, and Kenji Yasukawa will step down. In addition, due to their appointment as Vice Chairs, Vice Chairs of the Board of Councillors Kei Uruma, Keiichi Iwata, and Reiko Akiike will also step down.
As the nominee for the new Chair, Shinya Katanozaka (Chairman, ANA Holdings) has been selected. Katanozaka served as Vice Chair of the Board of Councillors in 2017 and as Vice Chairman from 2018 to 2022, working to address critical issues facing Japan's economy and society. As Chair of the Committee on Political Affairs, he worked toward achieving policy-driven politics and promoting business people's participation in the political process. As Chair of the Committee on Foreign Affairs, he devoted himself to addressing G7 and G20 summits and examining issues related to economic security. Drawing on his extensive experience, we determined he is the right person to lead the Board of Councillors, the advisory body to the Keidanren Chairman, and asked him to assume the position.
As for the nominees for Vice Chairs of the Board of Councillors, Yoshinori Kanehana (Chairman, Kawasaki Heavy Industries), Mitsuo Ohya (President, Toray Industries), Taku Oshima (Chairman, NGK Insulators), Yoshinori Yamashita (Chairperson, Ricoh), Isao Teshirogi (President and CEO, Shionogi), Takayuki Morita (President, NEC Corporation), Mitsuko Tottori (President, Japan Airlines), and Koji Ishikawa (President, Sompo Japan Insurance) have been selected.
All nominees were selected based on a comprehensive judgment of their character and insight, management skill, track record in their respective industries, and a balance of business types and sectors.
Regarding secretariat executives, President Masakazu Kubota and Senior Managing Director Takashi Inoue will step down. Kubota will serve as a full-time Vice Chairman for the remaining one year of his Vice Chairman term.
Additionally, Senior Managing Director Kiyoaki Fujiwara will be promoted to President, and Managing Directors Ichiro Hara and Tomoko Hasegawa will be promoted to Senior Managing Directors. Furthermore, Public Relations Bureau Director Masami Hasegawa and Industrial Technology Bureau Director Naoko Ogawa have been selected as nominees for new Managing Directors.
(In response to a question about the vision for Keidanren going forward and the thinking behind the new leadership structure) We face a mountain of critical challenges in transitioning to an investment-driven economy, achieving a virtuous cycle of growth and distribution, becoming a science and technology-oriented nation, and pursuing integrated reform of tax, fiscal policy, and social security systems, among others. The confirmed nominees are brimming with individuality. The expectation is that they will offer broad, high-level views and engage in vigorous debate, and we believe we have assembled a structure that will ultimately come together as one to establish the presence of the Japanese economy.
In making these personnel decisions, including for the secretariat, our guiding principle was renewal. To maintain organizational vitality, it is precisely when organizational performance is at its peak that we should look to the future and pursue renewal.
With an eye always on transitioning to the next generation and promoting capable individuals, we intend to advance key policy objectives while establishing the ideal vision for Keidanren. We will continue to devote ourselves to enhancing worker motivation and ensuring diversity.
(In response to a question about why Ms. Tottori was nominated as Vice Chair of the Board of Councillors given that Japan Airlines has been involved in multiple incidents in recent years) Public trust is the foundation of any company, and only with that trust can a company exist in society and conduct business. It is essential that corporate leaders take the lead in building effective governance and fulfilling their social responsibilities with high ethical standards. In that context, the occurrence of multiple incidents at the company is extremely regrettable.
Although, the understanding is that the organization as a whole has taken these incidents seriously and is working with full commitment toward preventing recurrence and restoring trust.
Ms. Tottori has contributed to Keidanren activities as Chair of the Committee on Consumer Affairs. I think she is someone who is exceptional in her commitment to listening to the voices of frontline workers and customers. In Keidanren's work as well, she is a business leader who listens to the diverse views of member companies and society at large and can provide invaluable insights in shaping Keidanren's future direction. She was selected based on this comprehensive judgment.
Middle East Situation
(In response to a question about the impact of rising crude oil prices on the Japanese economy amid escalating tensions in the Middle East, and any requests to the Japanese government) At present, we are seeing surging crude oil prices and significant volatility in financial markets. The strong hope is that the situation will not become prolonged, but this could also be seen as the market sounding an alarm over fears that the crisis may become prolonged. Should the situation become prolonged, there is a risk of stagflation, where economic slowdown and accelerating inflation occur simultaneously, with serious consequences for the economy and people's livelihoods.
However, at this point, it is difficult to make any premature judgment of the extent of the impact on the real economy or people's lives. We will be monitoring developments closely and with a sense of urgency.
It is also difficult for the business community to make specific requests regarding government economic measures at this point. Rather, we would like the government to work closely with the countries involved to pursue diplomatic efforts toward an early de-escalation, and to do everything possible to ensure a stable energy supply.
(In response to a question about reports that the G7 will hold a finance ministers' meeting on March 9 to discuss a coordinated release of oil reserves) In an emergency, the fact that G7 nations are coordinating to address the risks and considering measures against surging crude oil prices is worthy of the highest commendation.
(In response to a question about the appropriateness of releasing oil reserves given concerns over a prolonged situation) Whether a coordinated release will be effective in curbing surging crude oil prices remains to be seen. However, the very fact that countries are working together to overcome the emergency through diplomatic efforts is expected to have a positive impact not only on crude oil markets but on financial markets more broadly.
As for releasing Japan's domestic reserves, there does not appear to be an immediate need at this point, but determining the most effective timing for a release is extremely difficult. It is important to prepare for a range of scenarios, taking into account not only price impacts but various other considerations as well.
Japan-U.S. Summit
(In response to a question about expectations for the Japan-U.S. summit scheduled for March 19, given the escalating tensions in the Middle East) The hope is for a frank exchange of views on possible approaches toward early de-escalation.
On U.S. tariff measures, the government should enter negotiations with the aim of ensuring that Japan is not placed at a disadvantage relative to last year's Japan-U.S. agreement. We recognize that in addition to the current 10 percent tariff, further additional measures are under consideration. The government should work to resolve the uncertainty surrounding U.S. tariffs and improve predictability for companies looking to invest in the United States.
Regarding Japan-China relations, it is extremely significant that the Japanese and U.S. leaders will meet in person to align their positions before President Trump's visit to China. It is necessary to explain to the U.S. that prolonged tensions between Japan and China are also detrimental to the United States. The government should be urged to convey concrete examples, such as how China's export restrictions on rare earths and other items targeting Japan are possibly affecting Japanese companies and could also affect their production activities in the United States.
In addition, it is also important to reaffirm the U.S. commitment to a "Free and Open Indo-Pacific (FOIP)", as confirmed at last October's Japan-U.S. summit.
Wage Increases
(In response to a question about the impact on wage increases in the spring labor-management negotiations and real wages, given growing international uncertainty due to escalating tensions in the Middle East and other factors) Whether the escalating tensions in the Middle East will become prolonged, and to what extent corporate activity will be affected, remain entirely unclear. Since the impact varies by industry and by company, it is difficult to comment comprehensively on the impact on wage increases at this point.
Going forward, after the concentrated response date for major companies, negotiations will continue primarily among small and medium-sized enterprises. At present, the escalating tensions in the Middle East and developments around additional U.S. tariffs are heightening uncertainty in international affairs, and predictability has declined significantly. Should the situation become prolonged, we will need to monitor carefully what impact may emerge.
Real wages turned positive in the preliminary January figures of the Monthly Labour Survey. This is attributable to 49 consecutive months of positive nominal wage growth, combined with a significant decline in the consumer price index. This shift to positive real wages is viewed favorably.
Looking ahead, there is significant concern about the risk that rising prices, particularly energy prices, could affect the trajectory of real wages.
Although predictability has declined, Keidanren will continue to prioritize investment in people, including wage increases. With investment in people taking the lead, we aim to achieve the transition to an "Investment-Driven Economy" and ultimately realize "Virtuous Cycle of Growth and Distribution".
(In response to a question about the significance of continuing to pursue wage increases even as corporate predictability declines due to escalating tensions in the Middle East and other factors) For many years, many Keidanren member companies and other corporations have leaned toward allocating returns to shareholders in the form of dividends and share buybacks. On the other hand, with respect to employees, companies prioritized employment preservation above all and were cautious about wage increases, particularly base pay increases.
With labor supply constraints intensifying as they are today, it is critically important to view wages not as a cost but as investment in people to enhance corporate value, from the perspective of recruiting diverse talent and enabling them to thrive over the long term.
Right now, companies are positioning investment in people as part of the transition to "Investment-Driven Economy" and recognizing that this leads to realizing a "Virtuous Cycle of Growth and Distribution". Companies have begun to strongly recognize the importance of contributing to not only returns to shareholders but also to improving labor productivity and corporate value through talent development and human capital investment. I think this shift in mindset is contributing to establish the strong momentum for wage increases in recent years.
From the perspective of potential growth as well, labor supply constraints have a very significant negative impact. Keidanren believes that investment in people, that is, wage increases have an extremely important role in overcoming the barrier of labor supply constraints and achieving "Virtuous Cycle of Growth and Distribution".
National Council on Social Security
(In response to a question about views on consumption tax cuts and expectations for discussions at the National Council) Since the National Council is a forum for discussing issues of national importance, the range of participating political parties should be broadened for deeper deliberations.
Regarding a consumption tax cut, the National Council should discuss this thoroughly, fully taking into account that the consumption tax has been positioned as an important and stable revenue source underpinning the social security system. In particular, they should rigorously discuss the identification of alternative revenue sources.
It is reported that the National Council will discuss not only a consumption tax cut and refundable tax credits but also the social security system as a whole. Keidanren believes that issues such as integrated reform of tax, fiscal policy, and social security systems should in fact be the core discussion at the National Council. These issues are to be considered from the perspective of overall optimization. We strongly expect a public-inclusive discussion on the overall vision of a sustainable, fair, and equitable tax and social security system.
Selective Separate Surnames for Married Couples
(In response to a question about Keidanren's reasons for calling for selective separate surnames for married couples, and views on the government's proposal to legislate the use of maiden names as common names, including the option of using only one's maiden name) From multiple perspectives, including strengthening international competitiveness through women's empowerment, establishing women's identity as they advance in their careers, and eliminating disadvantages in daily life and work, selective separate surnames for married couples should be at the core of efforts to promote women's empowerment in Japanese society going forward.
The government's proposal to legislate the use of maiden names as common names, including the option of using only one's maiden name, shares the same objective as Keidanren in the sense that it aims to promote women's empowerment. This is understood to be under consideration with the aim of eliminating the disadvantages caused by name changes in all aspects of daily life and work.
However, it is understood that there are diverse opinions within the Liberal Democratic Party and among political parties. What matters is that we sincerely listen to the voices of those who are actually experiencing difficulties, discuss thoroughly how to eliminate these disadvantages, and ensure that more women can establish their identity and play active roles both domestically and internationally.
Keidanren's position is to call for the realization of selective separate surnames for married couples, and we will continue to closely watch how the discussion develops.
Comprehensive Review of Work Style Reform
(In response to a question about the results of the Ministry of Health, Labour and Welfare's comprehensive review five years after the implementation of work style reform legislation, in which approximately 10 percent of workers responded they wanted to increase or somewhat increase their working hours, while approximately 60 percent said the current situation was fine) Among workers who say they want to reduce their working hours, some would like to increase them during certain periods. Similarly, among those who say they want to increase their hours, some cite not income considerations but rather the desire to improve the quality of their work. I understand these survey results demonstrate just how diverse workers' needs regarding work styles are.
It is understood that going forward, the Council for Japan's Growth Strategy and other bodies will take up the review of working hour systems as an agenda item for further examination. While ensuring worker health remains the fundamental prerequisite, the hope is to see a comprehensive review of systems that enables flexible and autonomous work styles, including the discretionary labor system, to meet workers' highly diverse employment needs.
Prime Minister Takaichi's Distribution of Catalog Gifts
(In response to a question about the appropriateness of how donations were used, given reports that Prime Minister Takaichi used funds from donations to her own party branch to send catalog gifts to all winning candidates in the recent House of Representatives election) When companies think about compliance, not violating the law does not mean anything goes. Whether something is appropriate in light of good judgment and common sense also falls broadly within the scope of compliance.
Regarding this catalog gift matter, this is understood not to violate the law, but whether it was appropriate beyond that is something the prime minister herself has addressed, and we will refrain from further comment.