Sexism stands in way of saving Japan

I had this conversation in Tokyo 12 years ago with Ms Sheryl Sandberg, long before she joined Facebook Inc and wrote her book on female empowerment.

We were listening to her boss at the time, United States Treasury Secretary Lawrence Summers, speak about the need for structural reforms to the Japanese economy, in a giant auditorium devoid of women. It was one of several male-dominated events that day. The author of Lean In leaned over and asked me half-seriously: “There ARE women in this country, right?”

A dozen years on, Japan’s leaders appear to have realised that the two problems are intertwined: The lack of women in the workforce poses one of the biggest structural impediments to faster growth. Japan’s institutionalised sexism deepens deflation, hurts competitiveness and exacerbates the demographic trends that make Japan’s debt load so dangerous.

Prime Minister Shinzo Abe claims that tapping the other half of Japan’s 126 million people is a key element of his revival plan, dubbed “Abenomics.” Yet, his proposals are timid and may even make it harder for Japanese women to enter the working world. As with other vital structural changes required to restore Japan to health, Mr Abe needs to act more boldly.

RUNNING WITH ONE LEG

The World Economic Forum ranks Japan a dismal 101st in gender equality out of 135 countries — behind Azerbaijan, Indonesia and China. Not a single Nikkei 225 company is run by a woman.

Female participation in politics is negligible, and the male-female wage gap is double the average in Organisation for Economic Cooperation and Development countries.

One number explains why Japan must pull women into the job market and help them achieve leadership roles: 15 per cent. That is how much of a boost that gross domestic product would receive if female employment matched men’s (about 80 per cent), says Ms Kathy Matsui, Chief Japan Equity Strategist at Goldman Sachs.

“Japan is lagging because it’s running a marathon with one leg,” says Ms Matsui, who has been churning out Womenomics reports regularly since 1999. “It must start tapping its most underutilised resource.”

Mr Abe is acting from fiscal necessity, not from a sense of social justice. Japan’s workforce is shrinking as the population ages and the birthrate declines. That might be manageable if not for a public debt more than twice the size of the US$5.9 trillion (S$7.5 trillion) economy. Politically, increasing the number of women workers is an easier sell than opening up Japan to immigrant labour.

Yet even so, the Premier’s proposals hardly match his rhetoric. He has talked about extending childcare leave, expanding day-care facilities and asking companies to hire female board members. He is merely scratching the surface and reinforcing stereotypes about the role of women in society.

The government is considering circulating “Women’s Notebooks” to warn of the evils of postponing marriage and motherhood. Yes, career-oriented women are selfish. When Mr Abe calls on companies to provide three years of maternity leave, he uses a Japanese expression that a child should be held by its mother until the age of three. In other words, kids are women’s work. (In fact, knowing that a three-year absence could derail their careers, many women are likely to further delay childbirth.)

Mr Abe’s government should begin by actually enforcing the 1986 Equal Employment Opportunity Law. Japan should promote diversity and offer tax incentives to companies that do, as well. More-flexible work hours would draw women into the workforce. So would offering subsidised or free day care so more families can afford it.

GENDER QUOTAS

Mr Abe should consider quotas for female executives. A 2012 McKinsey & Co report titled Women Matter bemoaned the low percentage of female Japanese managers and found companies that champion diversity are more profitable and innovative. Women are good for business, not charity cases.

And yet, only 30 companies on the Nikkei 225 and 130 out of the 1,600-plus companies listed on the Tokyo Stock Price Index, have a female board member. Those numbers will not improve on their own.

These are not the only difficult structural fixes Mr Abe is avoiding. Is he lifting barriers to immigration? Tightening corporate governance? Tweaking taxes to support startup companies? Crafting a new energy policy that creates jobs, cuts prices and phases out nuclear reactors in seismically active Japan? Nope.

Has the Premier introduced more flexibility into labour markets? Is he ending protections enjoyed by farmers, medical services or fisheries? What about retooling the education system? Again, no. Manipulating exchange rates is simply easier than upending Japan’s postwar model.

It is time for a national dialogue and decisive action. Women should take a page from Ms Sandberg and demand equality. Japanese men must lean in, too. In a top-down society, the push needs to come from political and business leaders.

“To change things in society, you do need to put change agents in leadership positions,” said Ms Matsui. Mr Abe boosters, including many women, like to think that’s exactly what the Prime Minister is. But the market — which plummeted on May 23 partly due to doubts about Abenomics — is not entirely sure yet. Some investors are concerned that Mr Abe would not match the Bank of Japan’s policies with ambitious moves to free the economy.

The Prime Minister’s aides urge sceptics to wait until next month, when he supposedly plans to lay out a more detailed reform plan that will take on several previously untouchable political lobbies. Simply choosing the right battles is not enough, though. If Mr Abe truly wants to revive Japan, he will have to bring more powerful weapons to the fight.

ABOUT THE AUTHOR:

Tokyo-based William Pesek won the 2010 Society of American Business Editors and Writers prize for commentary.