Japanese Business Begets Japanese Philanthropy

September 23, 1991|By NEAL R. PEIRCE

The Japanese corporate interests that moved with speed and power onto the U.S. industrial scene in the '80s are finding themselves under a pressure they never felt back home: to give something back to the communities where they do business.

Total Japanese giving to the arts, education and social causes in America has soared from $45 million in 1986 to $300 million in 1990 and conceivably as much as $500 million this year, estimates Craig Smith, editor-publisher of the Seattle-based Corporate Philanthropy Report and the author of the just-published book ''Japanese Corporate Connection.''

Four of the biggest players, each with company foundations here, are Hitachi, Honda, Nissan and Toyota. Honda's foundation is endowed with $14 million and focuses on education. Hitachi, involved in a trade scandal early in the '80s, set up a foundation that is now Japan's largest charitable presence in America.

One can argue it's ''about time'' the Japanese got involved more fully in the America that critics say they're literally trying to ''buy up.'' There are now Japanese manufacturing plants in 500 American communities. The Southeast has 280 of them with Nissan, in Tennessee, the largest. Georgia alone has 300 Japanese businesses and 7,000 Japanese residents in the state.

Yet the idea of corporations giving back to the places they do business is alien to Japanese culture. There's no Japanese word for ''philanthropy.'' Japan has never had a system of foundations and non-profit organizations to aid the arts, education or the needy.

Now that's changing. With increased internationalization of Japanese corporations, ''we're moving away from the idea that it is all right to pursue profit alone,'' says Kazuo Watanabe, a Mitsubishi executive who ran a plant in Durham, North Carolina.

Speaking at an Atlanta conference organized by Mr. Smith's Corporate Philanthropy Report, Mr. Watanabe also put his finger on the most compelling reason the giants of Japanese industry and banking are finally getting serious about charitable giving in America:

''Philanthropic activities,'' he said, ''are important to the corporate identity, and from a long-term perspective they are linked with enhancing the corporate image.''

The same is true, of course, of a major chunk of U.S. corporations' charitable gifts -- public relations is a major motive. But the Japanese have a special problem. There's widespread resentment of their massive buyouts of U.S. interests. Japanese firms get hit with high numbers of discrimination suits by minority and female employees.

Some critics say Japanese giving is a kind of ''hush money'' to quell hostile American sentiment on trade with Japan, or that the Japanese rush to endow chairs at U.S. universities is simply a way to buy cheaply into American universities' research and development -- some of it federally funded.

But it also seems true that many Japanese executives are coming to recognize that in America, they're faced with a complex, multi-cultural society that requires a lot more of them -- ''the first time they've ever had to wrestle in a demographic zoo,'' notes Brad Warren of Corporate Philanthropy Report. Typically, says Mr. Smith, the Japanese increase rather than cut local charitable giving when they buy an American firm.

The Japanese often get massive tax breaks in return for their factories. Kentucky's total subsidy to snare the massive Toyota plant at Georgetown was $373 million -- money right out of taxpayers' pockets. Now Toyota, worried about worker literacy, has given $2 million, and may give $3 million more, for a child and parent literacy program at its Georgetown plant.

You have to ask: Do the few millions for ''philanthropy'' make up for the hundreds of millions in forgone public revenues for roads, schools, social programs?

Actually a literacy program is rather ''progressive.'' The lion's share of Japanese giving has gone for such ''mainstream'' (and visible) causes as art museums, universities and endowed university chairs.

Japanese wealth in these cash-starved times could be a real boon for neighborhood and community development in troubled inner cities. American foundation executives have been conveying that message to the Japanese.

Yet the director of a center for crack babies in Florida complains: ''When I talk to the Japanese about crack babies they look at me like I'm crazy. They don't get it. They don't understand the problem.''

Will the depth of America's problems, and the need for foreign firms to play a less cynical, more constructive role, start to sink in back in Tokyo? Perhaps. Dentsu, the massive $8 billion-a-year Japanese advertising, lobbying and public-relations firm, has agreed to translate Craig Smith's monthly Corporate & 2/3 Philanthropy Report and circulate it to a Japanese corporate audience. Dentsu will also inaugurate its own similar report for Japan and provide Mr. Smith with an English translation to accompany his publication here.

It sounds sort of incestuous. But the future's likely to be that way. American and Japanese societies are becoming ever more intertwined. Open dialogue and frank criticism is critically important.

For a dialogue that encompasses the broad needs of society and not just financial power moves, philanthropy may be a good place to start.

Neal R. Peirce writes on state and urban affairs.

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