Background of the Nikkei CSR Project

Since 2003, I have managed the Nikkei CSR Project. Over the past four years, the project has been influenced by taking the suggestions of many people into account. I would like to thank these people for bringing me to where I am today with this project.

Over 100 people have contributed to this Nikkei CSR site. Together with the symposium, book publications, study trip to Europe, training conference, and excursions to classrooms, over 1,000 people are involved in the Nikkei CSR Project. Surely it can be said that the meaning of this project is condensed into various sectors of opinion.

As one involved with CSR as far as it has come in the present day, it is my pleasure to present on several points regarding the structural concept, and change within the Nikkei CSR Project.

The first real year of CSR in Japan was 2004, but I would like to touch on the circumstances of the years before that, 2002 and 2003, pointing out 3 features of CSR before the boom.

Number 1 is SRI (Social Responsible Investment). During that time, many Japanese companies had a very difficult time with SRI questionnaire from foreign countries. Not only did they have to answer in English, but also the IR (Investor Relations) content was very different from that which had been available up until that time. The questionnaire contained questions on everything from the assignment of female management, to the differences in employee income, to whether the restrooms were kept separate or not, causing the IR manager to worriedly think, "Do all of these things really matter?"

Number 2 is international certification in CSR. Helping companies with the fear of being globally locked out from the inner workings of the supply chain, many Japanese companies already have ISO 9001 and 14001 certification. When they finally do obtain the certification, there are new and different issues to deal with. The companies tend to make a big deal over standards that differ from quality and environment such as commercial and cultural practices.

Number 3 is activities that contribute to society. Due to a request for connections on the citizen level, the above-mentioned SRI and CSR certifications have stressed importance on speeding up their association with NGOs. However in Japan, the partnership between companies and NGOs has historically been shallow, and many in the Community Affairs Department and General Affairs Office worry about how to place value on NGOs. On the other hand, many have expressed interest in pursuing the goal of how to cooperate with NGOs.

At the time, I felt the same unease as many of the people in those companies. I was very unsure about the widely disputed ideas of CSR. I thought it would be best to avoid the trend toward CSR being something in which only companies with a surplus of funds took part. In other words, in order to be satisfied with answering the SRI questions, to assess value from the certification mechanism, or to associate with various NGOs, you need a large amount of capital. Furthermore, there are many cases where a business’s CSR activities are not connected with producing any profit. And so, in the short term, at first glance a company may appear socially excellent. However in the long term, it results in there being no end to companies that cause great damage to society and the environment through aimless management, a large quantity of layoffs, neglected pollutants (for example).

Therefore, the Nikkei CSR Project is based on the philosophy of, "Societal Contribution Through Business". While producing profit through their business, the company has social significance. And now, in regard to the circumstances of the previous 3 points, I have provided the following explanation.

First of all, instead of treating SRI as a formal requirement, shouldn’t it be used to assess what a company’s profit is used for? No one will invest in the stock market if the returns are low and the risks are high. But to say, “If the this year’s profits are greater than last year’s, raise our shares,” is not good CSR. It is most socially responsible to invest in a company whose intentions are to abide by the law and upon earning profit, invests in its own future by caring for its employees, the environment, and society.

Secondly, a certification should be something useful for management. Adhering to formal requirements, it is strange to only look at the results. By doing this, you become removed from the basic nature of CSR. For example, being particular about the number of female employees is, in itself, sexism. To begin with, the important thing is to institute fair employment practices. The ratio of men to women in the workplace differs so there is no meaning even if equality is the standard. To create a useful index in management, you have to base it on the most recent commercial practices and corporate culture.

Lastly, the most important societal contribution is to place importance on business and regularly pay taxes. Most citizens do not want companies to build music halls; they want them to focus on safe operations. They don’t want them to create art museums; they want them to create safe products. Not to mention association with a formal, highly recognized NGO is decidedly not a contribution to society. If you take the businessperson out of the workaholic, there is meaning in encouraging their social activities as a citizen.

That is the background of the rise of the CSR trend in Japan, and the beginning of the Nikkei CSR Project.