 Okay. I guess we'll get started. So welcome to the session on demography. My name's Gary Hansen. I'm a macroeconomist. I teach at UCLA. And I'm very happy to be here doing this. We're really pleased and we're really fortunate today to have three distinguished practitioners and scholars, very diverse group of people with very different things to say about demography as it relates to Japan. So what I'm going to do is I'll just call each one of them up in an order that we've prearranged, different than the order there. And then they'll each speak for about 20 minutes and then we will have some question and answer and discussion. So our first speaker is Professor Elena Cappatina. Elena is a macroeconomist who has just joined the faculty at the Research School of Economics here at ANU. She's a Canadian citizen and received her PhD from the University of Toronto in 2011. Before moving to ANU, she spent seven years working at the Arc Center of Excellence in Population and Aging Research at the University of New South Wales. There was much research that was carried out on the implications of aging in East Asia. Her own research has focused primarily on macroeconomic models of health. So without more, I will call her up. So thank you very much for the introduction and thank you very much for inviting me to this event. So in this talk, I will be talking about the impact of aging on economic inequality. Specifically, I will look at the effects through health and long-term care provision. So just as an aside, my own research is in the area of health risk insurance and inequality in the U.S. Now clearly compared to the United States, Japan is a country that has achieved a higher degree, much higher degree of equity in general and in particular in healthcare and long-term care. Japan is one of the healthiest and most homogeneous humanitarian nations in the world. However, Japan has entered the era of super aging, demographic change and advanced health transition, which is increasingly putting pressure on the sustainability of its health and long-term care systems. And this brings challenges with respect to equality and equity. Looking at the challenges faced by other countries such as the United States provides perhaps a cautionary tale for the issues that could arise in Japan as well. So for example, we can ask questions on how the different demographic and socioeconomic groups benefit from the provision of universal healthcare and public insurance for long-term care. For example, in the United States, research shows that it is in fact the wealthier of better off groups that disproportionately benefit from publicly available long-term care insurance that's actually meant for the poor. And that's because the wealthier groups live to much older ages and when they do, they have much more severe health problems and more chronic conditions and multi-morbidity, which cost them in the end a lot more. And after they run down their assets, they rely on the public system. So the same can be asked in Japan who benefits from these publicly provided systems. And also we can ask the same about the costs of financing. How are they distributed? Who will bear the cost of the demographic transition? So clearly it's important to think about inequality since inequality is strongly associated with social, political and persistent economic problems in the long run. Now before I get into my talk about Japan, I also want to emphasize that aging is affecting all economies in East Asia and the effects of aging will be felt not only domestically in Japan clearly but throughout the region. So the age dependency ratio in Japan is 40% now if we look around here. And that's of course projected to skyrocket to 70%. But by 2050 we expect China to be right there at 42%, same for Thailand and Vietnam. So all these countries will experience and go through the same thing and how they face these challenges will have an effect throughout the region, especially for China due to its large population and economic size. In fact by 2050 the UN estimates that China will have more people over the age of 60 than any other country in the world. So it's important for it to manage this transition and the implications will be felt for all. Now in terms of health systems in Asia, Japan looks very similar in terms of expenditures per person as the other advanced nations such as Australia, New Zealand, Singapore. And this is despite the fact that Japan has a much older population. And so Japan has been very successful in keeping the costs per person quite low due to relatively efficient health system. So now in the rest of my talk I will highlight some of the challenges facing Japan. I'm providing an overview of the challenges that I thought would be the most important to talk about. However as I said my expertise is not in Japan so perhaps the other speakers will emphasize some other ones. But so I'll be talking about some health inequality among the Japanese elderly. Aging inequality between different regions in Japan, caregiving and economic inequality specifically informal care provision and finally financing health and long-term care systems and the implications for intergenerational inequality. So there are significant differences in life expectancy in Japan between different groups. The most stark ones are between men and women. Life expectancy at birth is only about 82 for males but 89 for females. Well of course in most countries you see differences between men and women with women living longer. This difference is larger in Japan than in other countries. For example in Australia the difference is 80 for men and for women so just four years. So this relatively large difference in life expectancies means that we can expect relatively long widowhoods for women in Japan compared to other countries. And most widows experience a decline in living standards because of the joint household resources that are often depleted by the time the husband dies. Men retire later and die earlier than women. So overall men spend about five fewer years on public pensions than women. So gender gaps in life expectancy are really important and need to be taken into consideration in the pension system before. Now a positive aspect about Japan is that while there exists a variation in health and mortality by socioeconomic status as in pretty much any other country this association between socioeconomic status and health and mortality is much lower in Japan and this reflected more egalitarian system. However recent research has found that this association is getting larger so this is a cause for concern. And another concern is regional inequality. In a recent article in The Lancet it's been found that not only there exists health and mortality inequalities between different perfectures in Japan but the differences are getting larger. Now why are these differences arising? Well of course lifestyle factors are important. Smoking rates vary greatly between perfectures with for example provinces in the north such as Omori province having 45% of men smoking compared to only 35 in Inara province. However displays are relatively a small role in explaining the overall differences. As do health system inputs. So the article makes the point that there needs to be an assessment of sub-national health system performance. So here I just want to show you some graphs about the regional variation across Japan in life expectancy by perfecture. This is for men. So the differences are about three years between the extreme cases of the Shiga province with the highest life expectancy compared to the Omori province which has the lowest. And similarly for women we get a similar picture. Now here the difference is only about three years. I just wanted to highlight that this is not much but the concern is that it's growing. However if we look at China for example at healthy life expectancy for women in China the regional variation is much much higher. Much more than 10 years between the poor provinces here and the richer provinces here. And this of course has implication for pension reform because some provinces will be able to adjust a new retirement age and pension withdrawal reform much better than other poorer provinces where a healthy life expectancy might be even lower than the new legislated retirement age. Now the health insurance in Japan provides a remarkably equitable and low cost system especially relative to other countries. However as noted in a recent New England Journal of Medicine article the achievement and equity are now at risk due to aging. Japan still has about 3,500 different insurance plans with varying premium levels. And the fragmentation in these insurance plans are differentially affected by this is differentially affected by the increasing number of elderly people in Japan. So as people retire they move from employment based plans to non-employment based plans putting pressure on these. And this has been partially addressed by reform in 2000 and 2008. Reform in 2000 addressed the long term care insurance needs and in 2008 the government created a new program for the 75 and older population. However problems do remain in the fragmentation of these. So now long term care in Japan is of course has been traditionally provided by family. Traditionally it was mainly the daughters-in-law that provided long term care but this has changed dramatically. Early parents live more and more independently so cohabitation rates have gone down. With the introduction of the universal long term care system in 2000 this has allowed more people more carers to be employed. So about 13% of the population over 65 applies for public long term care insurance. But here the issue I want to emphasize is that the benefits have been disproportional. So yes people in general have been able to continue employment more as a result of this long term care insurance and they provide less care. However it's mostly the high income groups who have done so. For them their employment rates have changed very little as a result. So even though long term care is a universal insurance program there are co-payments and individuals do have to pay for the food and accommodation when in nursing homes. So perhaps some of the costs are still impeding some of the low income groups and not allowing informal carers to go to the labor market keeping them to these caring jobs that unfortunately has implication for inequality as some workers are stuck providing care not gaining experience of human capital while others are employed and can expect future benefits from this. Most people do prefer to receive informal care at home and more of the care is provided by the spouses. Of course much of this is provided by women but the good news is that men are actually providing more of this care. So the fraction of male carers has increased from about 11% in the 1980s to about 23% in the 2000s. Still a low ratio but increasing. However it's been found that male carers often employ additional resources and they suffer from lower rates of depression and stress than women carers. So of course there are issues around the equity and the gender differences in informal care provision. So finally I just want to speak a little bit about financing the universal healthcare system. Of course due to aging we can expect more and more pressure on the system. So a paper by Shu and Yamada 2017 provides a quantitative analysis of the influence of population aging on the cost of maintaining the universal health insurance system. Of course raising the tax burden would be a solution however this is not desirable for the working age population as it would lower their labor supply and undermine their ability to smooth consumption over the life cycle. So they look at two policies increasing co-payments for health insurance and consumption taxes. They find that both policies would bring significant welfare gains in the new steady-states for future generations. However both reforms have harmful effects for the current generation that is close to retirement or has already retired as they have no time to prepare. So here there's an issue of intergenerational transfers that are needed to compensate some of demographic groups because while everybody as a society everybody will benefit some groups will lose and others will gain. So in conclusion Japan is still one of the most egalitarian nations but aging has introduced challenges to equality due to health and long-term care needs. Due to the diverse ways through which aging has an impact on inequality it seems very important to adopt a multidisciplinary perspective. So I was working at Seapart Center of Studying Population Aging Research in Asia until recently so I just wanted to provide their website they have a lot of interesting research that's multidisciplinary on these issues and I think there are many opportunities for collaboration between fields addressing these challenges. So thank you very much. Alright our next speaker is Professor Heroko Akiyama she's a social psychologist at the Institute of Gerontology of the University of Tokyo and I believe she founded that institute. So her research has primarily in her career focused on designing and implementing and studying panel surveys of the elderly population she's worked both in the U.S. and in Japan and with a particular focus on identifying issues related to the physical and mental health of elderly. In particular she has tracked approximately 6,000 elderly individuals in Japan over 30 years so she's really in a unique position to know what it's like to be old in Japan. So what's that? Thank you for the kind introduction. Well I'm delighted to be here and also grateful for the invitation and as Professor Hanson mentioned my background is social psychology so I look at aging society from individual and community perspectives unlike I mean the previous quite informative presentations and discussion at the macro level I take a bottom-up approach. I'll start with a very brief description of the background and as you know Japan is a front-runner of aging societies and average life expectancy of Japanese women is now 87 years and 81 years for men and the current total fertility rate is 1.43 as a result 28% of the Japanese population is age 65 and older and in 2030 in the middle I mean the one-third of the Japanese population will be 65 and older and we expect a drastic increase of people age 75 and older and this segment in the orange part this segment of the population will account for 20% of the total population in 2030 and only 12 years from now. Actually I mean my mother is 97 and my aunt just celebrated 100 years I mean the birthday in July so actually we live long. And we have also seen positive changes over the years and we are not only live longer but also live healthier and this slide compares the usual walking speed of the people in the same age groups between 1992 and 2002 and the data is a little bit old and it shows all the persons in 2002 were 11 years younger than their counterpart in 1992. In other words a 75 years old person in 2002 was walking in the same speed of 64 years old mean person in 1992 was walking. So I mean that means 11 years younger and so we continue to see the similar trends in both physical abilities and cognitive abilities and in January last year the Japanese association of geriatrics and gerontology made official pronouncement to raise the definition of old age from 65 to 75 years old. Actually I mean almost no one in Japan in the 60s they don't think they are old. They are in the middle ages. Dr. Hansen mentioned I spent most of my career conducting the large scale panel survey and so I have tons of data and statistics but I think I mean I feel I mean 10 years ago I mean I felt I mean reviewing all those statistics and also I mean everyday life observations I mean I felt we already knew what the issues and what we need now are solutions and actions. So I switched my research I mean directions and also methodology drastically and one viable approach from the academic community is action research and the purpose of action research is to solve a particular problem and to produce guidelines for best practice. And it is I mean especially I mean the research in collaboration with multi stakeholders such as government, industry various organizations such as NPO's and physicians association and certainly citizens and it takes a spiral of steps I mean each step is composed of PDCA cycles that is planning, action and fact finding about the result of the action. In my view the challenges and opportunities in age in age societies are condensed in these two issues of three issues. Okay, I added. And for the individual life design for 100 years and this is a new opportunity but this is still I mean the kind of I mean the issues we need to address. And for society the redesigning the hard and soft infrastructure to meet the needs of the highly aged society and for industry I mean promoting new industry by technological and social innovations. Well the existing infrastructure of communities was built when the population was much younger and we need to redesign both mean hard and soft infrastructure of communities to meet the needs of the society where people could live for 100 years staying healthy and active and live with a sense of security. And so I'm not talking about retirement community. This is kind of just regular community I mean the people at all ages I mean lived. And to address these issues we launched a social experiment in the communities. As this is a social experiment we evaluate the effects our interventions at individual level, community level and the cost. You see here. And we make policy recommendations based on the scientific evidence. Okay. And so we are learning this and these kind of projects now we are working on in the community. We have I mean two experimental sites one in the metropolitan area 30 kilometers away from Tokyo and the other in rural area. And we chose two quite ordinary communities so that they can be helpful for other communities in redesigning their communities. The following slides I mean illustrate the major projects we are now working on in Kashiwa in urban community. Well I mean the first project is a workplaces for the second life. We live longer and we work longer. As many of you might remember this is a title of OECD a report published in 2005. A huge number of baby boomers who commuted to Tokyo for many years retired and came back to this community Kashiwa. And we are creating age-friendly workplaces and flexible scheme of employment for the second life. So far we created nine workplaces, three are in agriculture, two workplaces are food related and the others are in field of education and personal care. All workplaces are operated by business owners at private sectors and the wage varies depending on the nature of work but the minimum wage is guaranteed for all jobs. And using work sharing we are and also we call the Mosaic I mean the labor Mosaic worker I should say we develop a flexible employment scheme for both the employers and the senior workers. Other persons I mean the older persons decide when and how long they work. So they everyone work at the capacity, I mean their own capacities. And management office called Office 7 conducts two-day job seminars for retirees. About 800 senior senior completed the seminar. And the other important role of Office 7 is matching between jobs and senior workers and support them at the initial stage of work. And many of them choose a totally different job from the job before retirement. And these senior workers at work we have been accumulating the scientific evidence on the effects of working in the second life on physical cognitive and social health. And we published the guide book for helping other communities to start a similar program. Based on our policy recommendations to the national government in March 2016 the registration was passed at the national diet to institutionalize this program nationwide. Now it is spreading throughout the country. The next project is a frailty prevention. In the highly aged society frailty is a dominant cause of disability. And this project promotes frailty prevention in a community and try to raise awareness of physical, cognitive and social frailty. And the so I mean this slide shows the frailty checkup conducted by senior citizen supporters. Actually the senior citizens really actively involved in the frailty checkup, annual frailty checkup. I'm just going very quickly having that. And the third project, the primary concern of older person is healthcare. And the national government is promoting the integrated community care system which provides home-based medical and long-term care services for 24 hours. Kind of continuous care. And it is a patient-centered healthcare system. And cooperating with hospitals and social care services such as mobile meals and transportation services it provides a total care in the places the patient lives. Three years ago a combination of independent assisted living facility was built in the central part of the community. Various service stations for home-based healthcare are located on the first floor of this building. They are the office of doctors who make home visit, visiting us, PT, and home helper stations. The pharmacy delivers medicine to patients home. And all of them deliver their services not only to the residents of this facility, but also to the residents of the surrounding community. We max the transportation is a big issue for all the persons to stay safe and active. Particularly, I mean, the population is 75 will increase drastically and many of them have difficulty driving cars. So in the collaboration of the several companies such as Toyota and Nissan we are working on alternative means of transportation in the community. We maximally utilize existing ICT and AI or IoT or whatever I mean to a new technology to reach out for people to stay healthy, safe, and connected. This kind of social experiment requires not only the collaboration of researchers in different disciplines, but also full collaboration with local governments, healthcare institutions, NPO's business community, and residents. We form the University Industry Consortium on Gerontology in 2009. The consortium provides a platform for academic ideas and business ideas joining together to provide a new values and solutions for the formidable challenges we face in aging society. So far, over 100 Japanese and international enterprises participated in the consortium. In 2011 Japan Science and Technology Agency, it's called the JST, a major government research funding agency created two programs which support social experiment to address priority issues in aging society, so they're supporting kind of action research. And action research is a promising research method but still in the formative stage. And we need to work on further developing action research as a robust scientific research method. A few years ago we published an introductory book of action research in aging society in Japanese. And I hope my action research gets citizenship in the academic community and contributed to solution for enormous challenges in the rapidly aging society. Now I want to talk about very briefly about Kamakura Living Lab which we launched last year. And we view 100 years life society as a gold mine of innovation. And we are trying to build a platform for open innovation like this. So I mean we have user community and then the big company, smaller company, startups and university government and we have creative commons for open resource. And so this is kind of platform for open innovation. Our Living Lab is a platform for innovation by co-creation with users. It requires much stakeholders, citizens, government, industry and academia so called quadruple herics. And user communities are not only observed subjects but also a source of creation. In my view this is a crucially important infrastructure for promoting technological and social innovation. Last year we launched Kamakura Living Lab. Kamakura is you might know I mean the old capital of Japan about 50 kilometers away from Tokyo. And this is front page of the leaflet explaining Living Lab which we distributed all household in the community. The core members of the quadruple herics are Kamakura citizens, Kamakura city government, the University of Tokyo and industry. We kind of mean the corporate division of Mitsui Sumitomo Bank one of the three mega banks in Japan participate because they have 400,000 the corporate clients all over Japan. We want to invite the small, middle size and small the corporations in particular rural area because they have good ideas on technology but many small companies are concerned about sustainability. So and also other industry many other companies and startups I'm very happy to see many young startups get very excited to join this platform for open innovation. And we started Transnational Living Lab with Swedish Living Lab and we are aiming them to serve I mean as gateways to Asian and EU market for each other. Okay I mean very brief introduction of our project. Thank you for your attention. So our last speaker is Deborah Hazelton and Ms. Hazelton is currently a director of the Australia Japan Foundation and one of the four banners of similarly sounding organizations that form the basis of what we're doing here today. I don't, they must all do very different things. And she's also a member of the boards of an impressive list of additional boards but she's spent her career in the global financial services industry and has worked extensively in Japan I think she's had 16 years as well as Australia and has held senior leadership roles in both Australian and Japanese banks. More recently she's worked with a Japanese mega bank in helping them transform their global workforce to work more effectively and product, productively together. So we're stepping from research to applying academic research to the real world to real world experience and conclusions drawn from real world experience. Thank you very much for the kind introduction. Clearly I am lowering the tone. But look, it's the end of the day and it's nice to have some practical input maybe. So thank you very much for the opportunity. I'm absolutely delighted to be at this terrific event. So I'm going to talk about Japan's demographic imperatives and what it means for workforce transformation in Japanese firms. Now as we've talked about earlier, the Japanese workforce is really two tiered. There is the informal workforce and there is the formal workforce. And in fact about 40% of workers now seem to be working in the informal workforce. I'm going to be talking from my experience, which is in the more formal structured traditional workforce. I think the lessons from this area of work are important because they are huge employers. They should be role models in what Japan should be looking at in terms of workforce. And they really add a lot to the economy because in fact it's their workers that get the biannual bonuses and spend it and have access to credit. So clearly that has not Oh, okay. I'm going to jump in here. Sorry, these are not great slides. I didn't test them on this machine. Okay, so future of work in Japan is driven to change and it's driven by demographic pressures as well as the burning platform for business success in Japan. As we all know if you're looking to grow your business in Japan you really have to be looking outside Japan as well. If you're not, then your customers will be in many cases. So that means we need a much more diverse and inclusive workforce. Now, when we look at these things from a Japanese point of view from a traditional, certainly traditional big players in Japan we need to recognize that Japanese employees see their role through two lenses. One is their business drivers to build sustainable growing businesses and the other is through their roles as economic and socially responsible entities for the growth and sustainability of Japanese economy. This has felt very strongly still in many Japanese companies and it became very apparent to me during the Royal Commission over the last month or so just how different this is in Japan to many of the Australian large firms. So there is a burning platform clearly for Japanese big firms to globalize their workforce and to transform their workforce. There are the domestic and demographic changes of the aging workforce and labour shortages. There's the pressures of globalization for business growth. The very complexity of business and corporate governance, both in country and globally, requires a different kind of workforce more agile creative workforce and that's linked to the need for innovation and performance improvements. There are a couple of ways of dealing with that. Of course, there is automation. A lot of these issues will be dealt with through using automation but also the people part of the workforce needs to be addressed. I'm going to concentrate on the people and this is where I'm going to talk about the importance of the diversity of the workforce and what that means in really implementing some of the changes we're seeing coming through. Particularly workforce change and diversity has got the strong endorsement and support leadership of the Japanese government. That certainly helps in Japan. Just briefly the experience I've had was with one of the three megabanks Musuhou Financial Group, Complex Group, very big 40 countries 60,000 employees although big in Japan a big presence in Asia, Europe and America. Across a lot of different challenges I was asked to introduce a way that the Japanese in Japan could think more creatively and work in a more productive global environment and how to bring the people from outside Japan into a Japanese firm. So how are we doing in terms of progress? Clearly we need to diversify the workforce because we need new sources of labour. We need more women. We need more older workers. We need long Japanese, young and also specialists. We need more differently able people. We need people who live different kinds of lifestyles for example people who identify LGBTQ. We need innovators. That means people who might think differently. Might not have gone through the education system. Might not have gone straight to one of the big Japanese universities. We might have God forbid bosses that are younger than the people who work for them. That means we have to look at HR systems and policies for example recruitment practices, work-life balance issues and performance management. Now to establish the right kind of workplace environment we can use training and development of course. But a lot of it is about mindset. A lot of it is about how people engage and work with people who are different. I'll stop here for a minute and I'll look at these new sources of labour because it might be interesting to know that for example in Mizuho we had a lot of programs going to invite and engage different sources of labour. This is to address obviously the democratic imperatives as well as to help create a more productive workforce. It wasn't just Mizuho, the megabanks were all doing it but also the other industries in Japan all recognising the drivers. So for women we tried to identify the women that we thought could grow into and become leaders and so we were training them, developing them setting up networks we were trying to develop the men to help them manage women Seems strange to have to do that but that's what we had to do. So we had all these programs that were to tell you the truth we didn't make much progress in terms of getting women into senior roles we set targets of course we moved some of the targets to tick some of the boxes but like other industries but we're still struggling with that one. It's interesting to note that a lot of the increase of women participating in the workplace in Japan are actually going into the informal the informal employment area and that means they do not have access to a lot of the benefits or the economic contribution they can't make the economic contribution that those in the formal network can make. To attract older workers we had programs where we would change the environment so that when someone retired we would invite them to reapply for another period of time in our institution we tried to design meaningful roles for them and we tried to make sure that they had the training and development they needed to fulfil those roles they're still older workers in this kind of environment in Japan not just in this group but across their traditional firms usually take a massive pay cut for the privilege of coming back and using their long-earned experience to benefit the company and society but that's a step in the right direction and hopefully that will be addressed. We tried to attract more Japanese non-Japanese people to come and work with us in Japan as well as sending our Japanese staff over to foreign countries to work with people from different cultures and backgrounds in the earlier stages of their career. Now once again there's a lot of programs going on some more successful than others with the younger people they were generally from Asia they were the kind of Mizuho staff that wanted to come and work in head office in Japan not quite so intimidated by the language maybe willing to take the risk the pay was an issue with bringing people from New York or no one wants to live in New York it's the centre of the universe sorry where's Sheila sorry but also we couldn't match the pay for a lot of the European and North American people but we had a lot of success bringing in younger people and sometimes they brought their families from other parts of the world particularly Asia and they worked with us we still lost more than we wanted what had happened is they'd work with us they would add value, they would train Japanese would love working with them they would love working with us they didn't want to go back to their home country and work for the Mizuho branch there so they'd quit and go to someone else maybe a competitor to stay in Japan so there was still some challenges there with the specialist the more senior people it was even more challenging and my view on this is that we just didn't go hard enough at it we would bring some specialist in from somewhere else in the world and give them a serious job with a serious title in head office and it was very hard for them to feel like they were making a difference or a contribution and I think it was because there wasn't a critical mass whether it was right or wrong they still looked like tokens and they didn't they didn't feel that they succeeded so there's still a lot of work to be done there there's a lot of work still being done there differently abled people there's a lot of government programs to foster the involvement of people with different capabilities or sometimes disabled in some areas and that's been going on for a long time in Japan but one of the things I was very pleased to see is a kind of different attitude one of the groups that was established was a sign language club so that the regular people in the group could communicate with some of the differently abled people that were coming in now in bigger numbers LGBTQ people who identify as LGBTQ this was one of the more fun areas and one of the more successful areas I think we had and I felt that people were more open to address this as an issue of adding value and having more fun and being more diverse compared to the women the gender equality I just there is a real sense in my view of fatigue with this particularly since we don't seem to be getting anywhere we had some real success with the LGBT education issues we had to have sessions in Japan where we took the HR people aside and explained what it stood for and why it was going to be a great thing to do and so on people really embraced it and one of the great things that happened out of that in my few years there was the first megabank or the first Japanese bank to introduce a system whereby we could recognize the same-sex partner as an equal contributor to home loan repayments for example and this got through the system and it came up when there was a young group of people doing an innovators course said well this would be a good idea and it all went through the system and my theory is that the blockers at the more traditional higher management level not the top management by the way but the people who didn't want the change didn't catch it happening so I reckon that this is the way to get things done in Japan in many cases innovators that's just the younger people all the people who have different backgrounds don't look or walk or talk the same we need to be able to attract them engage them empower them to make the difference so you know innovation hubs and different kinds of training for them and so on this is all going on it's not successful enough yet but it gives me some hope for the future work life balance of course is a huge issue if you're going to have people who live different lifestyles who have different values and so on you have to make sure that you are recognizing people for their output not their input we talked earlier about time spent at work my view in Japan is the longer you spend at work the less productive you are in many cases so because the people are just exhausted and they're not giving their best in terms of creativity work life balance we have some terrific targets like a hundred we would have a hundred percent zero percent target of people who would leave because they had to care for someone zero percent no one would leave because they had to care for children or old people or something we had a great target for men taking paternity leave a hundred percent now doesn't sound so ambitious but it's only five days but when we introduced that target it was 0.6 percent and men were taking that and I remember talking to my team about it and we were having lunch at the canteen I said something about this target and they said oh yeah I forgot to tell you Tanabe-san had a baby I said that was great baby girl or baby boy and he saw a little girl and I said that was great when was she born about an hour ago we do know though that Japanese companies have struggled to meet diversity and best practice standards and there's a lot of potential reasons for that in terms of gender in 2016 Japan ranked 111 out of 144 countries in terms of gender equality measures in 2017 we dropped three points to 114 mainly because of representation in the political and cabinet areas there are cultural reasons for this there are structural organisational reasons education system we know needs to stop educating girls and boys about gender role models when they're even just starting school and look a lot of people don't know about this but the traditional unique human resource management system in Japan is so different to the rest of the world we have to remember that paradoxically it was introduced at a time when there was a desperate shortage of staff and they had to attract people and keep them and make them walk very hard now those systems do not work anymore this is about recruitment from university lifelong employment generalist hierarchical seniority promotion and so on this has to change and all these are huge challenges all ending in the the biggest challenge of course is building the inclusive corporate cultures that can deal with it we can tick the boxes on diversity but if the young people are coming in and still being treated people from overseas are coming in and still not getting access to decision making roles women still not making a real contribution this is not inclusion this is just diversity can we be optimistic? I think so just the last couple of years I've started to see a lot more optimism in terms of publications and some of the statistics I mean with a real shortage of staff the argument behind keeping zombie companies alive is gone so hopefully that will mean that we have more productivity in terms of where for example the banks are supporting their customers now if you're going to have if you're going to have a smaller workforce then surely older well trained dedicated workers are a good place to start and if you can do diversity of young Japanese and non-Japanese this goes to the immigration issue which is essential then we can increase the productivity through the diversity of the workforce and the transformation we really need to see the increase in exclusivity now most of you will know about Jesper Kohl Jesper Kohl's been around for a long time since the mid-80s very respected strategist economist worked for Merrill Lynch J.P. Morgan advised the Japanese Government his feud and he's now with a think tank he now is saying that he's very optimistic about the fact that Japan has hit this kind of demographic sweet spot because of the quantity and the increased quantity and quality of employment his argument goes that even though the pool of potential employees between 1565 say is decreasing participation in the workforce is increasing and if we get that participation rate from 77% where it is now in Japan up to the gold standard 83% in Switzerland there's another 3 million people out there if you add to that immigration and also you change the quality of employment his theory here is that in the last couple of years there has been a rehiring of part time the informal workforce employees into full time then you start seeing this demographic sweet spot we can also learn from a lot of specific corporate measures I've been talking about the traditional financial services companies in terms of my experience but look they are probably the hardest to move on really traditional a lot of corporates in Japan are doing great work catalyst Japan is giving them awards every year people like Sekyu Lixel SMBC as well as foreign firms in Japan like Deutsche Bank and Coca Cola are doing great jobs around diversity and inclusion we can learn from those and we're going to have an increased number of millennials in the workforce by natural attrition particularly if we start bringing in different overseas so we hopefully are looking at a tipping point comes back to my point about let's have some critical mass let's see these people really making a difference and back them and according to Jesper Cole this is going to be a new middle class that drives that drives transformation of the workforce that drives economic growth and prosperity in Japan two of my fun slides this is what we did in Mizuho in terms of setting up women's networks globally and this was us walking in the Tokyo rainbow pride parade we were the only bank Japanese bank to walk in that in 17 I know there were many more in 18 Daichi life was the other Japanese big Japanese firm to be represented so I'd like to leave you with maybe three messages one is that I think there's scope for optimism even though the challenges are great I think the way we should look at this is holistically we need to look at the demographic drivers the gold mine for innovation as a positive and we need to be looking at these demographic drivers as driving us to look at how we build a new workforce that is inclusive of the diversity it needs to it needs to embrace and the third message is publicly in public companies as well as in public sector as well as in the private sector we really need to convince people that this is not about being nice to people it's about a business case for not only businesses being sustainable and successful into the future but actually the sustainability and the growth and prosperity of the Japanese society and economy and if we can convince those true leaders and get them to walk the talk then we can be truly optimistic thank you I'd like to thank our presenters but can open it up for questions do we have any questions do I need to ask questions you have somebody right there thanks that was all very terrifically interesting some amazing lessons for Australia OECD countries certainly learned from the initiatives in Japan around managing active aging I had a question for Debra Hazelton you talked about Mizuho I was wondering if you could talk about other types of companies and whether you see the same dynamics one of the things that's very noticeable certainly in Tokyo if not the regions these days there's a rise of small fairly internationalised companies often headed by Japanese women who are multilingual in many cases so there's a in addition to the needs to kind of refresh organisational culture within the large traditional companies seems to me that there are a lot of other types of organisational forms which are also grappling with those issues so if you had any insights about those organisations it would be great to hear them thank you that's a great question so as I said there's this informal employment area and the more traditional established employment area in terms of the big companies before I start there are some great initiatives and real progress particularly in the health industry in Japan and in the technology industry and also in consumer goods still probably more challenge than some of those informal areas where you've got young people innovators starting up new businesses I think for them and they I don't know how much they're struggling with setting up the diverse workforce I think they do that that's how they succeed but they're challenged in other ways in terms of the sustainability of their business model because of all the other things going against them and I guess what I would like to see and what I tried to do at Mizzouho is I tried to look at what they were doing well in terms of their more innovative and modern for want of a better word workforce mix I think we could really learn from them the reason I think it's worth looking at the big traditional firms is they are still massive employers and unless we can get them over the line as well then the impact certainly is not going to be as great a lot of reason so one of the reasons that we struggle getting innovative brave young women for example to join a traditional firm like Mizzouho they all they have to do is take a look and say well I'm not going to get anywhere there based on my merit or maybe what I deserve because of other reasons so I'm going to go into a startup but much riskier of course and much less rewarded often less pay don't have access to credit don't get the other benefits that go with those big firms but they've got the opportunity I worry about how many cycles of a failure of a startup can they go through before they just give up and either don't come in or they put up with the nonsense that goes with coming into those big firms when I tried to recruit some of those women they had no interest but then I did have visits from some of them later who said their parents or their husband or someone had actually pressured them after a failure or something going wrong in these small startups to actually come back to the big firms and it was unsatisfactory for everyone Questions? I have a question I think for Deborah about the compulsory retirement age at large Japanese corporates I remember losing a very talented school principal at an international school in Japan who turned 60 and the board came to him and explained that he could would have to retire immediately and come back to do exactly the same job as principal for half the pay he had just adopted three children and so was a new father at 60 he left Japan and has had a wonderful career in China for the last 15 years as a result and Japan lost him and I'm just wondering what prospect is there that that very hard cut-off point with this forced retirement at a certain age which is far below what we understand old age now is and why it persists Yes, so actually anybody could answer this question I'm just thinking how I can either get under the table or pass the question so from a practical point of view I saw a lot of effort in changing those rules and at the very senior ranks of course you go off to another senior position to look after a related company or something which is still a loss in many cases to the firm and you get compensated in different ways but most people would be told that they need to retire at a certain age they are looking I know in our firm we were looking at increasing that age but also we had come up with some creative ways of getting the person back and they would take a pay cut certainly but we tried to manipulate, it's a bad word to increase the salary with other duties or something to make it more attractive so there's all kinds of things going on to address it but I think from a policy sense I don't know perhaps Professor Akiyama Well I mean I'm working with I mean the economy and I'm not the economy but I think I mean the long term I mean the Japanese government is I think going to age in society and so I mean the first of all as I mentioned we live longer but also we stay healthier so we have the large human resource 60 or 65 in order and we are not using that resource very effectively and also I mean no one is happy with this kind of me I mean the continuing employment for them I mean just terrible I mean and so I mean but I think you can change this along I mean the tradition I mean immediately and where in Japan so it's the older workers the healthier and also the best thing is they are willing to work they actually wish to work I mean stay engaged in the work or I mean society and rather than I mean getting I mean just pension they want to contribute to the society okay so I mean now I mean as you know I mean some European country I mean raised I mean retirement age to 65 to 67 thinking about 70 I mean where I think that is I mean one of the options I mean in Japan but I think I mean in my view I think we the raising retirement age is not very wise I mean the policy because I mean after age 65 and older it's very I think just like I mean the second half of the marathon I mean people workers are very diverse in terms of the physical ability and also the time available I mean for some people I mean free for 24 hours some people taking care of aging parents or I mean spouse so it's in their time is limited so I think I mean we need to make an age society so I mean I think the lifetime kind of engagement in life but it's in the capacity each person can do so I mean I think we have to create I mean kind of flexible employment system and I mean just drop I mean retirement the mandatory retirement age. As a follow-up do you find evidence in your research that people who continue working that want to work do they live longer is that good we're actually I think that is what I mean are the data we accumulating the current the statistics I think I mean the proportion of all the people working and also the health care expenditure per individual kind of mean the mildly correlated but we don't know the causal relationship so I mean we are kind of assessing the senior workers I mean the physical cognitive and social health before start working and six months, 12 months, 18 months later and so far I mean we have some I mean positive effects but we need more data. My question is to Professor Kiyama towards the end of your presentation you mentioned this experiment or the between one in Japan one in Sweden I wonder if you could talk about that to us and if and if you could refer whether there were much similarity between Japan and Sweden or lots of differences between those two country I'm very interested hearing about it. This is about a living group we are kind of trying to form a transnational living group between Sweden and Japan I think we share many issues I mean so now we are focusing on four issues employment I mean Sweden also the older people need to work employment and housing and mobility and the loneliness and mental health issue and so we share the common issue but different socio-cultural context so we are my solution might not so that's kind interesting so I mean so we kind of solved the issue for example I mean the housing mobility and we test and we kind of mean some mobility but we can't sell that the car or whatever directly to your EU because there are some cultural differences in terms I mean the lifestyle social system companies the management system or whatever so I think we have two living labs so we need to test in Swedish living lab before we go into the EU market. Okay so I would like to join the discussion about extending the retirement age so my question is whether extending the retirement age is consistent with the current working customer in Japan I mean a seniority system because I think especially Deborah knows that at the major banks you need to be a division chief after working 10 years or that kind of things are determined so Professor Akiyama mentioned the age of society that means it's not just about extending the retirement age maybe we need to move on to the next question that's the first question and I'm also interested very much impressed with the Elena's presentation about the aging and the inequality thing and maybe you show the modeling result that you know it may increasing the tax and reducing the benefit could be the good idea but some generation may experience a lower welfare or something therefore you kind of suggesting some you know the aging situation or any kind of the you know maybe the policy may end up with some generation may or so for can we make everybody's women kind of situation these are two questions. Relays to my talk. So overall in the experiments where the co-insurance rates increase or the consumption taxes increase in both of these experiments everybody is eventually better off in a new steady state. As you noted along the transition some age groups will be worse off. Now I think there is enough there are enough benefits coming from the new steady states that can be redistributed to the current rate of losing out. So of course and those groups would have to be compensated to make any such policy politically feasible. So yes I would say because the gains are in the long run they can definitely compensate for a short term loss or subsidy to be paid out. So in terms of seniority promotion systems and so on. Oh yeah sure. Yeah I got it. You know I tried to mention that you know all these policies and systems have to be changed if we're really going to transform the workforce and if we're going to build a more diverse and inclusive workforce to do that to meet the requirements policies around recruitment have to change policies around performance management have to change and policies therefore around promotion and so on have to change. So there was a lot of work done on that and it's very clear that you can't have everything's wrong about a system whereby you hire everyone on the same day virtually every year and have them come in as cohorts and set them against each other because the triangles this shape and if they want to be promoted in their cohort then the number has to decrease they have to survive therefore it's not going to promote much collaboration they have to look better than their competitor and also they don't want to take any risks right because in the old system if you made a mistake then that meant your potential for moving up the ladder and being promoted was diminished so all that has to change so the hierarchical promotion system was very much under pressure and was changing dramatically there was still a lot of pushback of course and the mantra was that actually we will reward people for taking risks if it was for the benefit of the firm or the customer or so on even if they failed because that shows bravery and courage and commitment and innovation all those things so you might start to get younger people being promoted over their cohorts and then over their seniors the management challenge to those guys and there are all men maybe but for one the management there was still the problem with the lack of inclusion right because then you had people who felt they had this boss forced on them who was younger than them and so unless they had a truly inclusive mindset recognise the value of it it still didn't work so it comes to that tipping point comes to enough examples of how it can work how it can be fun, how it can be good for the company and the customer until you do that you can't get the benefit of changing the policies but you've got to start with the policies so that's why I reckon if we keep going seeing the good examples we'll get to a tipping point okay we are out of time I mean I know you had a question do you want to ask quickly I was going to ask Deborah I do research on females and you being on the top of the miserable and also as a in a sense outsider of the culture I do know that there is some progress if you look at statistics there are some statistical significant progress even though the gap is still so large between males and females promotion I mean the rate of managers but what is the actual step that you think first I was going to ask a different question but because it's question was quite good so what is the actual step that we can take that you recommend for us I totally agree with you it's a fundamental change in employment system but what is the first step that we can take in that direction that can be supported in the sense of productivity and in the sense of inclusion well choose the right company make sure you've got sponsors more than one in a Japanese firm very difficult you might join have a sponsor and then they get promoted out or aged out or side lined and rotated so you need to build sponsorship these are all with men senior men my view is to try to create that inclusive environment by pulling up the other people who are different around me so you don't stand out as the token strange one and then also the resilience the generosity of spirit to always look at the when you bang down to always look for the positive opportunities that come with that and a lot of luck I think but I think you need to establish this network around yourself of the other women you're working with as well as the other people who are different and support what you're trying to do and that makes a huge difference and that's a challenge for people from different backgrounds too because they don't have the natural network of coming from the same university and so on and the people who are taking off early to care for people and so on it's harder for them so the challenges are there but I think having that support network and believing in yourself is you know the way to go okay we're definitely over time I'm going to go to the centre and turn it over to Veronica thank you so much to our last group of panellists so I just want to close out the update today with a word of thanks and I'd ask you to show your appreciation at the end so first of all to all of our speakers and our chairs today we've had some really outstanding presentations some of the very best in the history of the update and I'm going to suggest that those are correlated with the high proportion of expert women that we've had speaking I want to thank you our audience for participating very much in the spirit of the Japan update which is one of having a really informed discussion that's also very candid I want to thank my co-conveners Shiro Armstrong and Ipe Fujihwara from the Australia Japan Research Centre who did much of the intellectual work on forming the program for this year's update Gary you were joking about the banners the banners matter a lot to us because what they represent is the support ecosystem in Australia for really thinking deeply about the Australia-Japan relationship and so I want to underscore our thanks to the Association to the Japan Foundation and to the Embassy of Japan who together make this update series possible and finally and most importantly on your behalf I'd like to thank the invisible helpers today Will Zoll, Hang Dung Thomas Holm, Arun Mumarati and also the rest of the AJRC team particularly the student volunteers who have run the microphones tirelessly today are the logistics possible so I want to invite you back to continue the conversation at this time next year but in the meantime thank those who made today possible thank you all