The notion of Japan’s revival is an ever-present topic on the global stage. We have heard much about Prime Minister Abe’s revitalization plan built on the notion of three arrows: the pressuring of Bank of Japan into launching unprecedented aggressive monetary easing; a blowout deficit-financed supplemental government budget filled with new public works spending; and a program of reforms to achieve growth through stimulating private investment. And we see the 2020 Summer Olympics now being hailed as the fourth arrow in the quiver.
Today, I delivered a speech to the PR Society of Japan explaining that these four arrows alone cannot fully support a revival. It will rely on the addition of a perfect bow or “yumi” to shoot the arrows and launch the revival. The bow that I believe is essential is a commitment to transparency by government and business alike. A bow cradles an arrow as transparency encompasses each plank of reform, and a bow provides arc to the arrow as transparency sets recovery aloft.
With his use of social media, Prime Minister Abe, himself, is setting a worthy example. He uses Facebook as a platform to communicate regularly and authentically with constituents and has created a game app to reach younger audiences with his message. By espousing social media, he’s issued an implicit challenge to the old world order, which is defined in Japan by its very lack of openness, and its focus on control.
The flaws of the command-and-control approach to communications in Japan were exposed in the aftermath of the Fukushima nuclear disaster caused by the March 2011 earthquake and tsunami. The lack of transparent communications from TEPCO and the government, and the traditional news media’s failure to accurately report the story all but destroyed the Japanese people’s trust in government, officials and five major industries.
The lesson learned: transparency is not optional.
What people expect from business and government today is transparency, in word and in action. Business must explain both how and why it does what it does. Business must be part of the solution to social problems and explain their decisions and the impact of those decisions on consumers. The five principles of Radical Transparency are:
- Fuller transparency comes from merging mainstream and social operations. The new normal for crisis communications can be described as a merging of horizontal and vertical, which includes the melding of the continuing dialogue online based on individual observations with the more classic, analytic stories based on thorough reporting.
- Employees must be a key partner. The employee has historically been the last to know about corporate actions, well after shareholders, regulators and consumers. Recent findings in the Edelman Trust Barometer shows that employees are much more credible sources than the CEO or government official. And employees are among the most engaged on social media channels. Companies – and government – must forge closer connections with employees. They must be updated on strategy, as well as given platforms to share their own ideas and achievements at work.
- Customers and consumers must be given the chance to participate in product innovation. In Japan where research and development is king, to commercialize great innovations, new rules for consumer marketing show that the process of product introduction must move beyond the classic market research of focus groups or test markets. Today we have the opportunity for continuous interaction between brands and passionate customers, especially on social networking sites.
- Businesses must partner with civil society. Companies must partner with nongovernmental organizations – the new credible source in global governance – to set achievable targets on issues of societal importance, and then report regularly on their progress. A simple “CSR Report” detailing activities performed, such as beach clean-ups, will no longer suffice.
- Businesses must work with the community before acting. Businesses need to recognize the community as a priority stakeholder – integrating the insight of community members into its operating and growth plans. There must be consultation on the appropriateness of new projects.
Japanese companies are already advanced in many of these aspects. However, what is missing is the transparent communication with key domestic and international stakeholders and keeping them informed on these important elements.
Businesses must lead in promoting the new radical transparency. Businesses must be the first to use this bow. The Prime Minister’s arrows are the province primarily of government. The bow, I contend, is where business uniquely can lead. We are not talking of Japan’s revival. We are talking of Japan’s comeback and the capacity for that comeback is in Japanese business.
Richard Edelman is president and CEO.