Message from Outside Member: Takashi Nawa

Contributing to Society Through Business: The Recruit Group's Approach to Resolving Social Issues

Quantifying Impacts, Clarifying Long-Term Benefits

In its mission statement, the Recruit Group calls for the creation of a world in which all individuals can live life to the fullest, and it has designated five core themes as areas for commitment in its corporate social responsibility initiatives. Its annual report for fiscal 2015 (April 2015 to March 2016) is commendable for bringing the social issues the group seeks to address into sharper focus, as well as for taking on the challenge of portraying its business operations and initiatives within the context of these issues.

To ensure the sustainable growth of its domestic operations, Recruit announced to its shareholders that it will continue developing the Air series of service offerings to support small and medium-sized businesses and Study Sapuri, its online educational service. These two initiatives, along with iction!̶a project that spotlights women who are successfully balancing work and family responsibilities, which was a highlight of the CSR Committee agenda since last year̶are the pillars of the three stories told in this CSR report. I was impressed that information was provided on the business results obtained in these three areas.

By contrast, I felt something was missing from the description of the progress made in solving social problems. I hope to see Recruit take up the challenge of quantifying the social impact of its initiatives and release the results of its findings. The group's endeavors in this area should not be undertaken within the context of social contributions; rather, a broader-based, long-term perspective should be maintained on how the scale of the projects can be expanded and made profitable. The question of whether these initiatives are an investment that can produce intangible benefits is a compelling one. The crux of the matter is whether benefits can be accrued in terms of attracting human resources, enhancing brand appeal, and networking̶and how these benefits can be converted into tangible assets.

Opportunities for New Encounters in a Mature, Diverse Society

It is important for the Recruit Group to refine its strengths when addressing social issues. The company possesses a unique business approach, dubbed the "ribbon model," which connects users and client companies. Both ends of the ribbon must be the same shape in this model. The goal is not simply to anticipate needs and match supply to them, but rather to generate new demand by making adjustments to both sides. The emphasis on cultivating demand and creating opportunities, rather than simply matching, is a process of creating value, an area the Recruit Group has particular expertise in. Attention is now focused on what opportunities the group will create and offer in the face of emerging social trends.

Some scientists believe that by 2045, we will enter an age of technological singularity, when artificial intelligence surpasses human capabilities. In such a world, what will the role of human beings be and what will they be able to achieve? How will joy and affluence be defined? Once again, the Recruit Group has something unique to offer with the perspective it brings on how imminent social issues can be turned into new opportunities, based on a deep insight into human beings.

"Serendipity" will no doubt be a key concept. Encounters and connections that once had no appeal will have fresh power to enrich. In the coming age, chance, unexpected encounters that are outside the realm of computer recommendations will become the source of demand. To what extent will the Recruit Group be able to create the venues for these encounters and opportunities?

In the future, human beings will continue to be able to make judgments based on a sense of wellness that is not necessarily logical. In a mature society, we will have a truly diverse range of values, as well as various senses of truth, goodness, and beauty. This is an important point to bear in mind when deciding how opportunities in this new age can be created and provided.

Using Headwinds to Our Advantage

In the above, I touched on my hopes for the Recruit Group in the future. The company will probably need to consider the integrity of its main businesses when discussing social problems and may even come under outside pressure to take action. However, there is no need to question the business operations. I do feel that it would be better to adopt a meticulous approach that can drive the evolution of society as a whole by keeping in mind the options, instead of focusing too narrowly on the business operations. Think of potential opportunities and test them out within the company. Find the one that is best through an internal process of "marketing cannibalism." What remains will be a bellwether for the direction to be taken. As a company pursuing strategic business development, Recruit should be able to find an approach that is one step ahead of change. I look forward to seeing which initiatives it implements in its drive to create a society where each person can live life to its fullest.

2016.09.30

Takashi Nawa

Member, Recruit Corporate Social Responsibility Committee Professor, Graduate School of International Corporate Strategy, Hitotsubashi University CEO, Genesys Partners, Inc. External director, Fast Retailing Co. Senior advisor, Boston Consulting Group External director, NEC Capital Solutions Chairman, Next Smart Lean Co. External director, Denso Corporation External director, Ajinomoto Co.