Publisher’s Note

The Changing Environment & How to Avoid
Becoming Extinct Like the Dinosaurs
By Kazumasa Kusaka
This September Prime Minister Shinzo Abe, having served thelast six years in office, gained another three-year term as Liberal
Democratic Party leader. That contrasts with the previous fiveyear period in which there were five prime ministers. He is now
trying to push three particular policy issues during his currentterm.
First, amendment of the Constitution to stipulate the SelfDefense Forces as an organization for self-defense in order toestablish a legal base to end the claim of their unconstitutionality,
while maintaining Article 9 which renounces war as a means tosettle international disputes, and also to add the constitutionalright of access to education regardless of economic means.
Secondly, settlement of the Northern Territories issue tonormalize Japan-Russia relations; and thirdly, settlement of theNorth Korean abductions of Japanese nationals to clear a path forJapan to play an active role in the stability of the Korean
Peninsula.
The first two of these issues are not Abe’s personal initiative
but originated in the LDP’s founding declaration of 1955. Noneof the three issues can be tackled without a solid political base.
Abe can be ambitious by using his solid power, but the challenges
he is going to face cannot be taken lightly. The first challenge willbe the Upper House election next summer. Though like the midterm elections in the United States, a negative outcome would notmean the ousting of the incumbent prime minister from office,but it would certainly damage his political capital.
Next, even with a fixed term and mandate, politics and markets
look into the future, and begin to show interest in a short list of
potential successors and their qualifications. In all ages andcultures, it is a golden rule for No. 1 not to help foster No. 2.
Fortunately, democratic systems institutionalize suchtransitions and serve to enable stable governance. However, thequestion remains as to whether the duly-elected are necessarily
well qualified or not. A transition may be more stable if it takes
place regularly between two major parties before institutional andpersonal memories are lost. In Japan, however, the previous
switch from an LDP government to that of the Democratic Partyof Japan was costly. Historically in Japanese politics, factions
within the ruling party have staged power struggles with different
philosophies and policies, ranging from conservatives to liberals
almost close to social democrats. And it is these factions that havebeen the nursery beds for future leaders.
In the US, Washington outsiders such as ex-governors haveoften been the resource pool for presidential candidates, and more
recently anti-establishment sentiment has made a career as aprofessional politician a liability in running for the office. This ispart of a global phenomenon of distrust in established politiciansas agents for the public in their search for a new social contract.
https://www.jef.or.jp/journal/

So under such circumstances, how can society help foster thenext or future-generation leaders?
In the private sector, being caught between short-termism andexternal pressure for investment to meet corporate socialresponsibility, many corporations have shifted from organic
growth to merger-and-acquisition growth. Its consequence is a
decline of internal human resource development. This change has
made communication with outsiders of an organization or“village” increasingly more important than within the “village”
network. Stakeholders also now seek a sense of participation andownership in the process. Dialogue between corporations andbroad stakeholders including investors needs to be transparent andvisible. In this regard, external board members can play animportant role in coping with the changing business environment.
The single most important responsibility for independent externalboard members is to secure a succession plan to meet the changes.
Coming back to in-house human resource development, how
can we raise leaders to be well prepared for the future? Inpractice, a recent trend is to choose a sector officer who recorded
the largest profits among sectors within a company. But some ofthem have not had the opportunity to oversee the rest of their own
organization. To better prepare for business changes and risks, a
key word is diversity. For Japanese society, the empowerment ofwomen and ambitious placement of non-Japanese professionals
are pressing issues. Another perspective is who are the main
players in promoting the economy — established large
enterprises or new ventures? As is illustrated in discussions on
artificial intelligence (AI), while established businesses tend tothink it is a tool for them to increase productivity or to replacecostly human labor, venture businesses, working on AI-driven
business models, think they can compete against these established
enterprises that use AI in this way. Quite often they cannot
communicate well with each other. Revolution may disruptively
take place outside of the established organizations.
In both politics and business, naturally organic progression has
ceased to be an exclusive path, and the roads to growth have now
become multi-track. Diversification and multi-tracking are now
the best means of risk management in an uncertain world. The olddays in which a crown prince would be educated during a longwaiting period have gone. Nowadays, both in politics and in
business, those who can learn about leadership are not thedesignated particular few but the diverse ambitious many. This isgood news!
Kazumasa Kusaka is chairman and CEO of the Japan Economic Foundation(JEF), as well as being a professor of public policy at the University of Tokyo. He
previously served as special advisor to the prime minister on global warming
after having been vice minister for international affairs at the Ministry ofEconomy, Trade and Industry.
Japan SPOTLIGHT • November / December 20181