Japan's Recruit Sees More Female Executives As Key To Growth

Glassdoor owner Recruit Holdings says it wants to have women in 50% of its senior executive and managerial roles within 10 years - a rare pledge in a country where men dominate the top echelons of companies, politics and the civil service.

The push for more women at the upper levels of Japan's largest human resource service company is part of a diversity drive to ensure a flow of bright business ideas, said Chief Operating Officer Ayano "Sena" Senaha, its most senior female executive.

As of April 1, 21% of Recruit's senior executives, including heads of major business units, were women, compared with 10% a year earlier, according to company data seen by Reuters.

"It's a survival mechanism - it makes commercial sense," Senaha told Reuters in an interview. "We don't manufacture things, unlike many other Japanese companies, and we launch services from fresh ideas from the employee base."

Recruit is already a corporate outlier in Japan, the world's most aged society, where many graduates still expect to spend their whole careers working for the same company.

Although three-quarters of Japanese firms have one or two female directors, only 5% have three or more, according to index data from MSCI.

By contrast, two-thirds of companies in the United States, 85% in Britain and 100% in France have at least three female directors.

CALL TO ACTION

Recruit's workforce is young and half are women. Senaha, 39, was promoted to the board in June 2020, becoming the youngest female director among Nikkei 225 companies.

She took up her current post in April 2021. The company announced its pledge a month later as a measurable target to accelerate its diversity drive.

"We need that pressure," Senaha said.

Recruit will nominate a third woman, Keiko Honda, as an outside director to its 10-person board at next month's annual shareholder meeting. Recruit has already had a female CEO, Eiko Kono, from 1997-2004.

"It's a great first step and I hope they expand into other measures of diversity and disclose everything," said Nicholas Benes, a corporate governance expert.

"Diversity should also include nationality, upbringing, education and key skills," said Benes, who heads the Board Director Training Institute of Japan.

In the last decade, Recruit's purchase of U.S. job search engine Indeed and job review site Glassdoor have lifted overseas revenue to around half of the company's total from less than 4%.

It has a market capitalisation of $60 billion and reported that operating income more than doubled to 379 billion yen ($2.9 billion) in the year ended March 31.

Indeed's co-founder, Rony Kahan, is the only foreigner on the board.

In recent years successive prime ministers have emphasised the need for Japanese companies to become more diverse and offer flexible working.

Under revisions to Japan's corporate governance code last year, companies are encouraged to disclose targets for promoting diversity. Business lobby Keidanren has called for 30% of executives to be women by the end of the decade, but such voluntary calls to action have a spotty record.

Japan continues to be known for long working hours, and many women still drop out of the workforce after having children. Few men take substantial paternity leave.

($1 = 129.3800 yen)

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