Don't throw away corporate liability, don't put priority on profits - Akahata editorial, October 22One major company after another is closing its factories or ending domestic production as part of corporate restructuring.
The typical example of this is Yokokawa Electric Corporation. It plans to shut down 15 factories in Japan and concentrate its production at four plants in Japan and another four plants in Asia.
Accelerated plant closures and suspensions
One hundred five major corporations have closed or suspended 187 plants in Japan this year. The number of factory closures increased by 50 percent over last year (Nikkei Shimbun, October 13). This shows a growing restructuring trend by leading corporations.
Cutting personnel costs and strengthening corporate "competitiveness" are major profit-comes-first strategies with expectation of large gains.
Plant shutdowns or production halts have a severe impact on local economies and communities as well as job availability in locality. We cannot leave things as they are.
For example, in one village, more than 100 people lost their jobs. This small village is now full of unemployed people, failing to find other jobs.
Companies are curbing new hires of high school students. In some areas, job vacancies are only available for one out of several students, which gives even more difficulties in getting jobs for new high school graduates.
Plant closures drastically increase the number of subsidiaries' or related -companies' bankruptcies, or drive them into financial difficulties and adversely affect local economies and local shopping districts.
What is more, plant withdrawals deprive local society of personnel resources, and lead to collapse of community and culture. A corporation is a social existence supported by workers, subcontractors, smaller businesses, local governments, and local communities.
In E. U. countries, it's becoming common sense for companies to not only benefit their shareholders but also take social responsibility for workers, business partners, the environment, and local communities.
In the U.S., if a company wants to close its plant or carry out massive layoffs, it must announce its restructuring plan to workers' representatives and local governments beforehand, and only 60 days after the announcement, the company will be allowed to implement the plan.
Japan's business circles admit that companies have certain social responsibilities. The Japan Business Federation (Nippon Keidanren) says in the "Charter for Good Corporate Behavior" that companies should not only seek profits but "must be useful to society as a whole."
It also says in the Guide to the Charter that local communities are foundations that companies are based on. It is now important for companies to act in accordance with their charters.
Witnessing the outrageous restructuring schemes and plant closures, local governments, irrespective of their political positions, are calling on companies to be responsible to society.
Major companies' unilateral notices of plant closures without any prior information are causing strong anger in local governments and communities.
It is necessary to make it a rule to hold a prior conference between local governments and companies about their plans for personnel cuts and plant closures as they will most likely inflict damage on local governments and economies.
Local governments are complaining that companies have failed to give reasonable explanations about plant closures.
Japan Keidanren's Charter says that companies should "actively and fairly disclose corporate information." It's necessary for all kinds of information, including that about companies' business operations, to be disclosed.
As for information disclosure, subcontractors should also be covered by the Law on the Promotion of Subcontracting Small and Medium Enterprises. The law stipulates that parent companies should provide necessary information about their plans for moving their plants abroad or domestically to their subcontractors and help them cope with adverse effects.
Companies must fulfill social responsibilities
It is selfish of companies to unilaterally close plants and do nothing to help the workers who have lost their jobs. Companies are responsible for ensuring jobs for them.
The government's behavior is impermissible, as it has absolutely supported major companies' restructuring, calling it part of the "structural reform."
The government is required to take measures to push major companies into fulfilling their social responsibilities of ensuring jobs and protecting local economies. (end)