Japan sets 30 per cent target for women executives at big firms by 2030

Japan’s Prime Minister Fumio Kishida on Thursday ordered his government to begin work on increasing the number of women executives in major companies to at least 30 per cent by 2030. Women represented only 11.4 per cent of executives in major listed companies in Japan in 2022, according to a cabinet office survey, although the figure has been rising in recent years. “We seek to have the ratio of women among executives at 30 per cent or more by 2030 in companies that are listed on the Tokyo Stock Exchange’s Prime Market,” Kishida told officials at a meeting on gender equality. The Prime Market is the stock exchange’s leading sector. Kishida said ensuring diversity would boost innovation as well as the economy. The meeting also discussed how to offer more permanent jobs to women in Japan, many of whom are part-time workers as they try to balance childcare and employment. Gender gaps Japan is struggling to improve gender gaps in leadership positions, notably in politics and in the upper echelons of business, as well as the wage gap between men and women workers. Japanese women have access to high standards of education and are well-represented in the workforce, but the country ranks consistently low in the World Economic Forum’s Global Gender Gap report. Japan was placed 116th out of 146 ranked in 2022, and is the only G7 nation not in the top 100. Japan’s labour chief wants women to defy social norms to become bosses Gender gaps in corporate leadership are a global phenomenon, with research showing only a handful of countries have companies where women make up more than a quarter of senior management. Government data showed that despite Japanese women’s income having doubled in the past 20 years, they still earn only a quarter of what men are paid. The average female monthly income was 83,896 (US$630) per month in February, according to a survey of households by the Statistics Bureau of Japan released this month. While that is nearly twice what they were earning per month in 2000, that’s far less than the average 345,645 (US$2586) yen salary for male workers, it showed. Lack of opportunities Much of the problem, experts and government officials say, is the lack of career advancement. When Kasumi Mizoguchi joined a top trading firm out of university in 2015, she was dismayed by the gender disparity in a rigid human resources system that classified employees as either “career track” or “non-career track”. Non-career workers, who were all women, did the administrative work. While Mizoguchi was hired on the career track, she left after two years, frustrated, and now works at an advertising and design firm in London. “Hierarchy was one of the bigger reasons that I left – just feeling that you don’t matter, that you don’t have a say,” she said. Japan admits it must do more to ease women’s struggle to balance work and home Apart from the 2030 deadline for female executives, there have been other efforts to level the playing field. Under disclosure rules introduced last year, bigger companies are required to report their wage gap annually. From this year they will have to disclose more information in regulatory filings, and in some cases disclose the ratio of women in management positions. The government makes the information available online, allowing jobseekers to scrutinise potential employers. “The fact that companies have to disclose puts pressure on them,” said Akiko Kojima, a specialist at The Japan Research Institute. “It is meaningful, but it is not enough. If companies just disclose the data but don’t increase the number of women managers, the gap won’t narrow.” The issue is critical for Japan’s economy, experts say, to help address a chronic labour crunch as the population shrinks. While women’s labour force participation has increased in recent years following the “Womenomics” reforms of former leader Shinzo Abe, more than half of all women work at non-permanent jobs, according to government data. Those positions tend to have fewer benefits, lower pay and shorter hours. When women leave the workforce to have children, they often return to a lower-paying position, or a part-time job. Chika Sasaki, a manager at a Tokyo-based wholesaler, said there were too few women in leadership positions at her office, and too few working mothers like herself. “Almost all of the people in senior management are men. That’s why I think there’s a difference in salaries between men and women,” Sasaki said, declining to name her employer. “I don’t think they care about it too much. I’m a manager but I don’t have anyone who is a role model.” Why must top women executives choose between work and family? Brokerage Daiwa Securities Group Inc in 2005 started a programme to help female employees after its then-president realised too many talented women were struggling to balance their careers and families. It extended maternity leave to three years and took measures to promote rehiring women. In 2009, four women were among the 13 employees promoted to senior managing director that year, one of whom has since joined the board. The firm made a deliberate decision to promote several women at once so they could work together if they received resistance from male colleagues, according to Chiharu Mori, director of Daiwa’s diversity and inclusion promotion office. “We are trying to address all kinds of gender gaps, not just about pay, but everything,” Mori said. For women in Japan, legalising the abortion pill is only half the battle Daiwa encourages employees to leave the office before 7pm and has made paternity leave mandatory, rare measures in Japan. So far it has been difficult for ESG (Environmental, Social and Corporate Governance) investors – who are increasingly concerned with the gender gap – to engage with many Japanese companies on the issue, said Tomohiko Sano, head of Japan ESG research at JPMorgan Securities. Those that do disclose tend to already be high performing companies, he said. “It’s hard for investors to convince companies about the benefits of these efforts,” he said. Reporting by Agence France-Presse, Bloomberg, Reuters