Japan in the World

A Focus on the Sustainability of Japanese Corporations Balance sheet for private sector non-finance corporations NOMURA Other financial assets ■Net assets % of nominal GDP 400 300 200 100 0 -100 -200 -300 -400 Stock (asset account) Stock ■Cash and deposits Non-financial assets Liabilities (liabilities account) 94959697989900010203040506070809101112131415161718 CY Source: Cabinet Office, Government of Japan material In terms of change leading up to the Post-Corona age, there is one area where Japan and Japanese corporations can exercise an advantage. This area is sustainability The traditional stance of Japanese corporations to aim for long-term stable growth in profits, combined with a financial strategy of retaining relatively generous levels of liquidity on hand, has not always been praised by global investors However, a heightening interest in sustainability brought about by the COVID-19 pandemic may mean there is room for reconsideration of the advantages of the Japanese style of corporate management If challenges leading up to the Post-Corona age, such as the ones stated earlier, can be overcome, there is potential for a dramatic rise in the world's appraisal of Japanese economy, industry, and corporations 13

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