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Monday, Nov. 28, 2011

EDITORIAL

More CEOs find Japan important

More CEOs are finding Japan a place for revenue growth, according to a recent New York Stock Exchange report. Of the 371 CEOs polled for the report, 27 percent said Japan was crucial or important for their companies' future growth.

That is up from 19 percent in the same survey last year. Japan also rose from 12th to seventh place in regional significance among the CEOs, most of whom were based in the United States, but others in Western Europe and Asia.

These results may be cause for cautious optimism as Japan's economy shows a few small signs of starting to improve. Perhaps the status upgrade was a result of CEOs being startled by this year's tragedies in Tohoku. The survey recognizes Japan's ongoing economic importance in the global marketplace.

Even though it is positioned behind the U.S., Western Europe, China, Canada and Southeast Asia, and equal to Brazil, Japan is still important for revenue growth for a significant number of businesses.

The report also revealed the realities that are considered important for a healthy business climate.

MBAs polled alongside the CEOs indicated that nontraditional innovations, a globalized workforce, social media strategies and financially literate citizens were the best indicators of optimism about the future. In those areas, Japan is reasonably well established, although much work remains to be done.

Japan's business methods still need substantial reform to meet the demands of future business.

Of course, the CEOs and MBAs of the world are not exactly held in high esteem these days. The financial decisions of businesses and government continue to be questioned by Occupy Wall Street protesters, among many others.

Similar protests in Japan have been relatively few in comparison. That may be due to an overly passive populace not used to protesting, but it may also indicate a placid confidence that the economy will right itself eventually. Just waiting and watching for the economy to get better is unlikely to see results that are as productive as improved financial regulation of businesses.

As the recent scandals at Olympus and Daio Paper reveal, businesses need more, not less, oversight to run efficiently and, it seems, ethically and legitimately.

Perhaps Japan's upgrade in the CEO poll comes from a recognition of the stability of Japan's system compared with other economies where business is given a freer rein.

Much work remains to be done if Japan is going to genuinely emerge as a financially and politically stable country for international business in the future.



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