Japanese listed companies, and other companies that file an annual securities report, must now include a section on sustainability that covers human capital. It sets out the company's policy for developing people and improving the workplace, and the metrics and targets it uses to track progress.
Alongside the strategy, three numbers must be reported in the annual securities report, where the company is already required to publish them under the laws on women's advancement and childcare leave: the share of managers who are women, the share of men who take childcare leave, and the gap between men's and women's pay. All three are filed on EDINET, the government's electronic filing system.
The rules took effect for fiscal years ending on or after 31 March 2023, so most companies have now published three years of data.
What it means for a foreign employer
- It is the best free benchmark of Japanese employers there is. If you want to know how a competitor's workforce compares with yours, the numbers are public.
- Candidates read it. Women in particular look at the female manager ratio and pay gap before they apply.
- It shows where talent may be unhappy. A company with a wide pay gap or very few women managers may be a good place to recruit from.
- Your Japan entity may have to publish similar figures. Many of the same metrics apply to unlisted employers above a certain size under the laws they come from.
Sources
- Cabinet Office Order on Disclosure of Corporate Affairs, as amended January 2023, for fiscal years ending on or after 31 March 2023.
- Act on Promotion of Women's Participation and Advancement in the Workplace; Childcare and Family Care Leave Act.