30% CLUB JAPAN INVESTOR GROUP INTERVIEW SERIES VOL3
Interview with Kathy Matsui : Womenomics and How to Nurture Female Employees
GSAM Kathy, congratulations on
publishing your book, "How to Nurture
Female Employees." Could you talk about
the background and motivations for writing
this book?
Kathy When women's future careerprospects are uncertain, they are more
likely to quit because they find it difficult tokeep motivated. According to surveys on
the concerns of employers and female
employees, women in general—not justJapanese women—are more likely to dropout of the workforce for reasons such as
caring for the elderly or children. Even
when governments provide sufficient
infrastructure and daycare capacity, women
still have problems at the organizationallevel. After working in a male-dominatedindustry for 30 years, I wrote this book toshare what I have learned about these
intra-organizational problems and thesolutions.
GSAM Due to the effects of thecoronavirus pandemic, working from homeis becoming increasingly popular thanks toteleworking and the digitalization of work.
Kathy, what do you think about the effectsof the pandemic on current efforts topromote women's participation andadvancement in the workplace?
Kathy You are right. While the female
labor participation rate has risen to over70%, more than half of Japan's female
labor force consists of non-regular
employees. When the economy is at its
worst, part-time and non-regular
employees, many of whom are women, areparticularly vulnerable. Many companies
were already offering flexible work andwork-from-home options, but many people
were reluctant to utilize these options out offear that doing so could have a negative
impact on future promotions, or throw themoff their career tracks. Now that we are in
the coronavirus pandemic, work from home
has become a common practice. There areeven companies in which all employees
now work from home. In particular, thecoronavirus is cutting deeply into the
traditional seniority-based evaluation
system, which has long constituted thelargest barrier for women, LGBTQ people,
people with disabilities, and otherminorities. When people's performances isevaluated in a non-face-to-face fashion,
there is no alternative but to focus on
results and output. Conventionally,
employees could not get promoted unlessthey devoted all their time to theircompanies. The coronavirus has turned thisold way upside down, resulting in a further

push towards meritocracy. However, what I
fear most is that people will go back to thesame old way once the coronavirus crisis isover. Although this situation has helped
people to realize that they can transition to
non-face-to-face work while maintaining oreven improving their productivity in somecases, it has also encouraged many people
to proactively invest in information
technology, automate redundant tasks, cut
down on business trips, and so on. The
result is a boost for most minorities. WhatJapan needs most is a productivity
revolution.
GSAM As pointed out in the Womenomics
5.0 report, while the female labor
participation rate is now higher in Japan
than in the United States, many working
women in Japan are non-regular
employees, what do you think Japan should
do to remedy this situation? In Japan, thefemale manager and board representation
ratios also remain very low. What efforts
and measures are required to enable more
women to take up leadership positions?
Kathy There is no single solution; a broad
range of initiatives are needed. As I wrote in
my book, if you have a women employeewith high managerial potential, it isimportant to give her stretch assignments
as early as possible. And when there is an
opportunity for her to assume a challenging
role, just ask her if she is interested intaking the job without making any blindassumptions that she’s not interested dueto her family situation or othercircumstances. You must counter yourunconscious biases—for example, thatwomen who are married or have children
will turn down transfers or hesitate toassume more challenging roles. Corporate
should implement education and training to
get rid of these unconscious biases. Thischange cannot be achieved in a shortperiod of time – it’s a marathon not a sprint.
It is critical to change people's mindsets.
Not only in Japan, but all around the world
there is a general trend that women areless confident than men. When ten job
qualifications are listed as requirements forpromotion, women tend to refuse the offer
in many cases, saying that they only meeteight out of ten. In my experience, men are
more likely to take the smarter approach byassuming that not all ten qualifications havethe same weight, and the top three are themost important; they will take the initiativeon their own to get the promotion if they
think they can meet those threerequirements. Given that we belong to acompetitive society, mentorship andsponsorship initiatives are also important.

KATHY MATSUIFormer Vice Chair
Goldman Sachs JapanCo., Ltd.
Kathy Matsui was born in theUnited States in 1965. After
graduating from Harvard
University and earning an MAfrom Johns Hopkins
University, she joined
Barclays de Zoete Wedd
Securities in 1990 andGoldman Sachs in 1994. She
published "Womenomics" in1999, which underpinned theJapanese government's
policy of "promoting women's
participation andadvancement in theworkplace," and was ranked
No. 1 in Japan Equity
Strategy by Institutional
Investor magazine. She has
been vice chair of Goldman
Sachs Japan since 2015.
Besides working as chief
Japan equity strategist, she isalso a board member of theAsian University for Women
Support Foundation. She is
the mother of a son anddaughter. Her most recent
book is "How to Nurture
Female Employees."

Although a lack of role models is often
cited, Japan has many able women. Thesewomen should be presented as role models
to students and young women. Japanesepeople must make a conscious effort tochange the situation since genderstereotypes are deeply rooted in Japanesesociety, as shown by many media
commercials, such as those that imply set
gender roles by showing women working in
the kitchen. However, this does not meanthat women should be like men; they shouldtake advantage of their own personalities
and strengths, as the coming digital world
will be a more intelligence-oriented society
with less heavy physical labor, and greater
value will be placed on productivity at work.
Consequently, the skills which women havenaturally will increase in value in the future.

Also, many Japanese women are welleducated. Thus, the important thing is toenable them to demonstrate their skills
more by providing them with the necessary
locations, opportunities, and platforms.
GSAM Your story about the conditions forpromotion is very interesting. We also
heard in another interview that statistically,
women are more likely than men to have all
the required abilities for the new role whenbeing promoted to a higher position. This
speaks to the tendency of female
employees to agree to be promoted only
after they meet all the qualifications.
Kathy As the 30% Club Japan aims toachieve, Japan's female board
representation ratio is sure to increase in
the future given the impact of investors,
although the ratio remains in the single
digits at present. Under the influence ofinvestors, even management teams who
have never shown any real interest in board
diversity up until now can no longer ignore
it. However, it’s also true that presidents
and executives often only understanddiversity in theory and do not actually value
it. There is already objective data to clearly
indicate that the more diverse a company
is, the higher achieving, more lucrative, andbetter performing it will be in the stock
market; in my opinion it’s important to show
this evidence-based data. I also often hear
top management complain that they havedifficulty finding good female board member
candidates. Given the fact that there aremany women out there who have long beenworking in the investment management
industry as financial professionals as wellas in other sectors of the business world, I
am sure they can find them if they lookcarefully. So, my counterargument is: areyou really making a serious effort to look?
GSAM Let's move to the next theme,“work-life equilibrium”, which you wrote
about in your book. You wrote that weshould change the way we weigh work andlife moment to moment by reflecting thepriorities at hand, rather than trying to strikea balance between work and life at alltimes. Do you have any advice for people
who want to practice work-life equilibrium?
Kathy Although this is not the case foreveryone, many women I know are
relatively perfectionist. They want to dotheir work and housework flawlessly, andalso do things perfectly as mothers. Thismay be important for every woman, butwhen I had my first child and returned froma four-month maternity leave, I was feelingstress daily because of my perfectionist
attitude. Many of my colleagues were men,some of whom were married tohomemakers, and there were also single
women. The majority of them were unable
to empathize with my circumstances. I

doubt they would have understood me evenindices such as the MSCI Japan
if I had complained to them. The cause of
Empowering Women Index. I suppose thisthe stress was due to myself seeking to do
move constituted a first step. I sincerely
everything
hope that the disclosure ofperfectly. The
information will become
important thing tostandardized and be“DIVERSITY IS NOT
understand is thatdeveloped into a more
it is impossible tolegally binding measure.
OPTIONAL; RATHER, IT IS
do everything
However, I think what wasperfectly. "Do what
done was the correct move
ESSENTIAL FOR OUR
you can, and that's
as a first step. Anothergood enough." Or
improvement is that theSURVIVAL.”
as Sherylparental leave system hasSandberg
been enhanced. It is now(Facebook COO) says, "Done is better than
one of the best systems in the developedworld. In Japan, one year of paid parental
perfect."
leave, and many other benefits, areGSAM During engagements with theavailable to both mothers and fathers.
companies that we invest in, we sometimes
Although the percentage of fathers taking
see cases in which corporate initiatives,
parental leave remains low, at least thesuch as encouraging male employees tocountry has a system that is quite good.
take paternity leave, are linked to positive
One area that clearly requires improvement
outcomes, like a high female manager ratio.
is that there is an outright deficiency of
Do you have any advice for companies thatwomen in leadership positions. In mywant to establish this kind of positive
personal opinion, quotas should be applied
corporate culture?
to the National Diet and other public
sectors. The problem will not go away
Kathy First, it is important to present thesecompletely even if the government provides
trends and data to help employees learn.
the perfect infrastructure. Challenges will
Disclosure of information is the first step;
remain, such as intra-organizational
and then setting targets is very important.
problems and support for women's career
Setting targets will at least produce
development. Of course, Japan also has
accountability on the part of management.
some progressive companies, but as far as"You cannot manage what you cannot
I can tell, many typical Japanesemeasure." Creating a roadmap thatcompanies have no such vision. I haveincludes the steps required to achieve thebeen told that my book sold 7,000 copies
targets will lead to organizational action. By
since its release (as of the beginning of
doing this, you can monitor yearly progress
September). While I thought there isand identify delays. It may be difficult tonothing sensational about the book, I heard
form consensus regarding a quota system,
back from many Japanese companies thatbut having targets is better than nothing.
it’s given them new concepts. However,Another important thing is the commitment
given the recent pressure from investors infrom top management. Unless top
relation to ESG-related themes, and also
management repeatedly emphasizes that
thanks to a shift in thinking among thediversity is a pillar of organizational growth,
younger generations, the promotion of
not just an issue relevant to the HR andwomen's participation and advancement in
CSR departments, it will never truly be
the workplace is beginning to be viewed asengrained within the company. Education
an issue for everyone, not just for women.
for those recruited mid-career andThis is building momentum. As thesponsorship programs for high-potential
Japanese working population is predicted tofemale leader candidates are also
decline by 40% by 2055, the Japanese
important.
labor market is a workers' market. Allquestions concerning how Japanese
GSAM Womenomics marked its twentiethcompanies can grow in the future, and theanniversary last year. What highlights havecountry's sources of innovation eventually
there been along the way in terms of pastboil down to people. People are the mostimprovements and future challenges?
important resource, and I believe that it’s
essential for every organization to explore
Kathy One improvement is that the
how to attract, maintain, and promote
number of Japanese women working
human capital.
outside the home has increased by 3.3
million in seven years. In addition, there has
GSAM We understand that support fromalso been an improvement in information
the Abe administration played a major role
disclosure transparency. The Act onin the promotion of Womenomics. Can thePromotion of Women's Participation andpositive trend continue under the SugaAdvancement in the Workplace, which wasadministration? What do you think isestablished in 2015, requires companies torequired to continue to promote diversity at
disclose diversity information, and thisthe management level going forward?
disclosure is required for selection inKathy As a chief cabinet secretary, Prime
Minister Suga provided full support topromoting women's participation andadvancement in the workplace andWomenomics, and I expect he will continue
to do so. However, the first thing I want him
to do is to clarify why the government failed
to achieve its targets by 2020 and had topostpone them to 2030, and to identify
specific obstacles by presenting a clear
roadmap to achieving the next goal. I also
want them to go into greater depth about
their targets and information disclosure. For
example, I believe that gender inequality
cannot be eliminated unless there is more

disclosure of information related to genderwage gaps.
GSAM What is your advice for companies
that want to know how to effectively leaddiverse management teams?
Kathy Why is diversity important? If yourcompany performance is always steady you
may be an exception, but my understandingis that the performance of largest
companies is stagnant at best, and in somecases declining, as many companies arenow struggling due to the coronavirus. They
can’t improve their performance bycontinuing to do the same things that they
have always been doing. Introducing
diversity inevitably entails friction.
"Diversity" is not limited to gender diversity.
The most important type of diversity is
cognitive diversity. If different opinions ofpeople from different backgrounds arereflected in decision-making processes,innovations and new ideas are sure toresult from that friction. Of course, there
may be failures, but one can learn manythings from failures. We need tocommunicate that diversity is not optional;
rather, it is essential for our survival.

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