Why is Japan resisting changes? Speaker: Hiromi Murakami, the Founder and President of Japan Institute for Social Innovation and Entrepreneurship (JSIE) Presentation video: https://youtu.be/ioIuyfZ2Pxk

1. Why is Japan resisting changes?
Hiromi Murakami
Japan Institute for Social Innovation
and Entrepreneurship

2. Experience & Questions
• Ideas vs. Institutions
• 20 years – has mindset changed?
• Society imbedded of traditional values
• Founding JSIE
• Resist with notion of “women empowerment”
 ranks 114th out of 144 nations
 Cambodia (99th) vs. Japan (complicated)
 Believe in a perfect world
 Tomodachi girl question

3. % of women in senior management in Central
Government
(source: OECD Survey on the composition of the workforce, 2017)
Japan

4. Japan has lowest % female undergraduate
degree among OECD nations
• Japan is 2nd highest among OECD:
60% of 25-34 year-olds attained
tertiary education (2017). (Women
62% vs men 59%)
• However, 43% of female first-time
tertiary entrants chose short-cycle
programs (2016), compared to 16%
on average OECD nations.
• 2-year colleges, predominantly
women, aimed for particular jobs
(secretary, health, social workers) 
financial and job-finding reasons.
• Tuitions fees in bachelor in Japan are
the 4th highest across OECD
countries, after England, the United
States and Chile, at USD 5218.
Undergradu
ate degree
Female (%)
Undergradu
ate degree
(STEM)
Female (%)
Japan 45.4 15.4
OECD
average
58.2 31.1
Top nation 69.1
(Sweden)
41.4
(Poland)
Bottom
nation
45.4
(Japan)
15.4
(Japan)

5. Gender Pay Gap
Japan
ROK
India
USA

6. Japanese Women are discouraged to get
Advanced Degrees
Japan
Saudi Arabia
ROK
USA
Israel

7. Slow changes
UN Committee on the Elimination of Discrimination against Women (1981-)
• minimum age for marriage – 18 male 16 female
 both 18 years of age (2018)
• Waiting period after divorce
 6 months to 100 days (2016)
• Surname choice of marriage – 2015 Supreme
court ruled that one legal surname only.
(“destroying family value”)
• Inheritance for children outside wedlock
 ½ to equal (2013, 115 years) but still
discriminatory birth registration remains.

8. Why risk-averse mentality dominate?
• Many startups originated immediately after WWII
 Why then and why not now?
*Asset value that exceeds 1 trillion yen
Post 1980s – Rakuten (1997) and Softbank (1981)
• College graduates look for “stable” and “safe” company
• Social norms = Low status for successful entrepreneur
Less reward to risk-takers & start-ups
• Society that does not give 2nd chance?
1940s 1950s 1960s 1970s 1980s 1990s
6 5 5 3 1 1

9. College graduates look for “stable”
firms (1988 vs 2018)
Non-science Science/engine
ering
1 NTT NEC
2 Tokyo Marine NTT
3 Mitsui Real-estate Hitachi
4 Nissei Life Sony
5 Sumitomo bank IBM Japan
6 Fuji bank Panasonic
7 Itochu Fujitsu
8 Sanwa bank Mitsubishi
Electric
9 Daiichi Life Honda
10 Mitsui trading Toshiba
Non science Science/eng
ineering
1 ANA Sony
2 JTB Ajinomoto
3 JAL Shiseido
4 Mitsubishi UFJ Meiji group
5 Tokyo Marine Suntory
6 Mitsui Sumitomo
bank
Toyota
7 HIS JR East
8 Mizuho Kagome
9 Sompo Japan Asahi Beer
10 Itochu JR Tokai

10. Japan: Minimum Start-up rates
(Source: OECD The Innovation Imperative 2015)
Japan
USA

11. J Society values less on startups
(Source: Global Entrepreneurship Monitor 2017/2018)
0
1
2
3
4
5
6
7
8
Cultural and Social
Norms
Entrepreneurial finance
Gov't policy: support &
relevance
Gov't policy: taxes &
bureaucracy
Gov't entrepreneurship
program
Entrepreneurial
education at school age
Entrepreneurial
education at post school
stage
R&D transfer
Commercial & legal infra
Internal market dynamics
Entry regulation
Physical infra
Japan
USA
Israel

12. Low Entrepreneurial intentions
(18-64 adult in 54 nations)
0
10
20
30
40
50
60
70
80
90
Perceived
opportunities
Perceived capabilities
Fear of failure
Entrepreneurial
intentions
High status to
succesful
entrepreneurs
Entrepreneurship as a
good career choice
Japan (54/54)
Israel (10/54)
USA (19/54)
Saudi Arabia (1/54)

13. Lowest Entrepreneurial Spirit Index
(Source: Global Entrepreneurship Monitor 2017/2018)
-1.5
-1
-0.5
0
0.5
1
SaudiArabia
Lebanon
Indonesia
Poland
Peru
Kazakhstan
UAE
Sweden
Columbia
Netherlands
Israel
Chile
Ecuador
Panama
Estonia
Guatemala
Vietnam
Canada
USA
Brazil
Madagascar
Australia
Cyprus
Morocco
Iran
Luxemburg
Uruguay
Mexico
Malaysia
Thailand
Slovenia
Croatia
Latvia
ROK
Switzerland
Ireland
Germany
China
UK
Slovakia
India
Qatar
SouthAfrica
Spain
Egypt
France
Argentina
Bulgaria
PuertoRico
Taiwan
Italy
BosniaandHerzegovina
Greece
Japan
USAIsrael
Japan

14. Low Venture capital investment %GDP
(Source: OECD Entrepreneurship at a glance 2017)
Japan
Israel
USA

15. What factors constrain J Entrepreneurship?
(Source: Global Entrepreneurship Monitor 2017/2018)
• Unfriendly Entrepreneurial Finance
• Culture and Societal Norms
• Low Entrepreneurship education at school age
Focus on rule-abiding not encourage creativity
Everything is “NO” except few things (JP)
 kids always asking permissions, train them to think “in the box”
Everything is “YES” except few things (US)
• Disconnect from global entrepreneurs’
community (limited English capability?)

16. A Closed Society resisting changes
• Strong VETO power, powerful insider groups
• Incumbent (trusted) >> new comers (unknown)
Taxi/hotel industry Uber/Airbnb
• Lack of external information & external
communication (Limited English capability)
• Biased Media – inward-oriented views
• Low dynamics of market entries
• Little Political changes – people prefer status-quo

17. LDP supporting rate by generations
Younger generation has relatively higher supporting rate
Source: Toyo Keizai online

18. Japan’s problem
• Innovation not fully realized
= not only technical development, penetration of new social value
= impact on people’s lives changing behavior & perception
• Instead of encouraging, building walls for new ideas
= Blocking it before penetrating, if perceived as threat
= Passing the bill made hotels and Airbnb more expensive
= Could have enjoyed fruit of penetration
• Consumers are neglected
-- Less option, paying higher prices
-- never experience full benefit, missing spin-off effects (buy property)
-- can be innovation-drivers (engineer’s story)
• Too many restrictions, regulations, instructions
-- People outside Japan rather enjoy disruptive changes and inspire new
services
-- Sara’s story (need creativity to be successful as Airbnb host)
-- What are they afraid of?
• Innovative ideas crushed at birth
• Complacency

19. JSIE’s Mission
• Linking underutilized talented women with
entrepreneurship
• Younger generation to outgrow “the box”
• Encouraging Risk-taking spirit
• Provide opportunities to think beyond Japan
- Accelerator program in Silicon Valley
- Women leadership program in Boston
• Use English as a tool to break barriers

20. • www.jsie.net/en
• Women’s Initiative for Sustainable Empowerment
(WISE) summer program
WISE 2019 in Kyushu (May 2019)
• First Movers Forum- Nov. 20th
@Academy Hills Library Tokyo
• Washington Women’s Dialogue- Nov. 13th
@ Mansfield Foundation DC
• Global Peer Mentoring Network

21. www.jsie.net/en
Thank you!
Please join us
Nov. 20 evening @ Academy Hills Library
(Roppongi)
First Movers Forum in Japanese