Japanese boardrooms learn to love English

January 29, 2014 5:10 am

Japanese boardrooms learn to love English

By Jennifer Thompson in Tokyo

English, the lingua franca of boardrooms and even, in some cases, factory floors from Paris to Nairobi, remains a distinctly foreign tongue for much of Japanese business.

Indeed, the workforce of the world’s third-largest economy lags behind China, South Korea and even Iran when it comes to English language skills according to GlobalEnglish, an English communication software group owned by Financial Times parent company Pearson.

This is despite the fact that many of the country’s corporate titans, such as carmakers Toyota Motor,Nissan Motor

and Honda, have just a fraction of their business in Japan – and a fraction that is shrinking.

The same applies to sectors such as consumer electronics and heavy industry, while more domestic businesses, such as drugmakers and brewers, are desperately seeking overseas acquisitions for growth.

Hence the growing embrace of English – a language schoolchildren usually spend at least six years learning – by Japanese companies including BridgestoneTakeda Pharmaceutical, Fast Retailing and Rakuten.

Tyremaker Bridgestone announced in October thatEnglish

would become an official company language, while Takeda, Japan’s largest drugmaker, launched an English language learning service on the company intranet last year and holds board meetings in English, albeit just for the two non-fluent Japanese speakers.

While Takeda disputes any link between its efforts and the recent appointment of Christophe Weber, incoming chief operating officer who joins a tiny band of foreigners leading Japanese companies, it is likely to ease his transition.

International expansion was also the reason Fast Retailing made English the official operating language a year ago. Its Uniqlo fashion stores are proliferating throughout Asia as well as in Europe, the US and Australia, and roughly a third of its sales come from overseas.

While those working in the retailer’s Japanese stores are exempt, executives seeking promotion must score highly in the TOEIC exam, which measures English language skills. “It continues to be the common language across the region,” says Fast Retailing.

Rakuten, Japan’s biggest ecommerce group and the most high-profile advocate for the nascent movement, requires all employees to communicate with one another in English, apart from casual conversation. Low TOEIC scores jeopardise promotion opportunities.

Having made numerous acquisitions in the past five years as far afield as Canada, the UK, France, Brazil and Singapore, the company says that having a common tongue helps “share our view of the strategy”.

Yet many are sceptical that these efforts will bear fruit, or that they are even working.

Some employees question the wisdom of forcing native Japanese speakers to address each other in a language that they find difficult and suggest that while companies are keen to give the impression that they are embracing it, behind closed doors the reality is rather different.

“[Speaking English] does get trotted out a lot,” says one British employee who has xdd worked for a Japanese multinational for a decade. “But in terms of real productivity, it isn’t practical.”

An official at Fast Retailing also hints that not all senior staff have been so keen, noting that some who joined the company when it was concentrating primarily on the Japanese market have since been assigned to “domestically focused” roles as the company reorganises and looks increasingly abroad.


About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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