Japanese Firms’ Toughest Sell: a Better Image : Public relations: Deepening negative sentiments in the United States are causing worry. The Japanese business community is responding with a surge in corporate philanthropy.

Takashi Nakamura, the top Los Angeles official of Japan’s largest advertising agency, took his videotapes to Tokyo from Southern California. And they added up to a grim message for the audience of 600 senior Japanese executives gathered in Dentsu Inc.’s office in the Tsukiji district.

“I always thought this is the United States, but Japan is buying everything,” one Southern California resident said. “They lost the war so they are trying to win this way,” said a woman in her 60s.

An auto worker in Van Nuys said: “They are a very closed society. They have 2,000 years of a samurai culture. If you didn’t do it their way, they chopped heads off. But they are doing it very sophisticatedly now . . . they cut your economic wealth off.”

Nakamura plopped down a 148-page report--”Recent Negative Shifts in American Attitudes Toward Japan”--filled with 800 U.S. articles critical of Japan. “We have to study Mr. (Mikhail) Gorbachev,” Nakamura said of the Soviet President. “Mr. Gorbachev is a genius of public relations. We need a Gorbachev strategy.”

Japan still has no Gorbachev-like personality, nor can it claim Gorbachev’s success at public relations. But Japanese business is working hard to polish its sagging image in the United States.

Corporate good citizenship has become a preoccupation. Japanese companies have stepped up donations and other good-will efforts to American communities, charities and foundations.

Within weeks after the San Francisco earthquake, for example, Japanese firms donated $9.5 million to relief efforts. Japanese corporate gifts to the United Way last year totaled more than $12 million, double the total in 1988 and more than seven times the $1.7 million donated in 1986. The Beth Israel Medical Center and Hospital in New York received a $1-million grant from Tokio Marine & Fire Insurance Co. to set up a special clinic for Japanese-speaking patients. Another Japanese company donated $70,000 to a Chicago high school so that it could expand a program on Japanese culture.

A group of Japanese firms is even urging their government to provide tax incentives for charitable giving abroad. And some companies sense that they must go beyond money, with executives and families giving time as volunteers.

Reaching out to America, Japanese executives hope, will help to defuse fears of investment in the United States.

“If the sentiments become too strong, the (American) consumer might be hesitant to buy Japanese products. This we worry about,” said Sadahei (Sam) Kusumoto, president and chief executive of Minolta Corp., the Japanese camera company’s U.S. subsidiary.

“The image of Toyota here is selling cars,” explained Akikazu Kida, who was dispatched to handle public relations for Toyota in New York. “We want to inject who the company is. It’s time for us to speak out to America. . . . Everybody is concerned about the lack of communication and lack of knowledge about Japan.”

Poor Image

Whatever the reason, Japan’s image in the United States may be at its worst since World War II. Public opinion polls are full of bad news. One poll lists Japan as America’s least trusted ally. Another casts Japan as a greater threat to the United States than the Soviet Union. Others portray Japan’s trade policies as unfair and its investment in this country as a source of trouble.

Boosting its image may be Japan’s toughest sell yet. Japanese companies and executives are regarded as insular and cliquish, according to a draft public relations strategy prepared for Japanese firms by the New York office of Dentsu Burson-Marsteller, a joint venture of Japanese and American public relations firms.

Another perception cited by the report: Japanese firms always take, but rarely give. And when Japanese give, it is viewed as pragmatic and self-serving--a corollary to their lobbying efforts in Washington.

But Japanese companies in the United States are studying the American tradition of corporate philanthropy--then copying it or adapting it. Japanese corporate giving in America, which has been increasing by about 35% annually for the past five years, could top $300 million in 1990 and possibly $500 million in 1991, according to Craig Smith, editor and publisher of Corporate Philanthropy Report, a Seattle newsletter.

“Thirty-odd years ago, Japanese businesses suffered from a reputation of offering cheap goods. That has changed, but now we suffer from the reputation of having cheap companies in the U.S.--cheap in the sense they don’t get involved in American charities and civic affairs,” explained Kusumoto at Minolta.

Kusumoto has lived in the United States for 20 years but only recently became a member of a local United Way board. Just two years ago, only one of the 2,300 United Way campaigns nationwide had a Japanese member. Today seven communities have Japanese executives on their local boards of United Way. Martin T. Walsh, an official with United Way of America, said Japanese companies probably will exceed British firms as the largest foreign contributors to United Way in about a year.

Of the 500 Japanese-owned companies in the Southern California area, 39 have signed up for United Way programs so far, according to James P. Miscoll, vice chairman at Bank of America and chairman of the United Way of Greater Los Angeles’ current campaign. He expects to sign up at least 50 Japanese companies by the end of March. “That’s a big jump from zero,” Miscoll said. “We had practically nothing in 1986 because no one had taken the time to meet with these people and discuss it.”

Until now, corporate donations had to be cleared by headquarters offices in Tokyo. They were typically a hard sell because corporate philanthropy is not practiced in Japan, where the government takes care of social and charitable needs. “Volunteerism is a uniquely American concept unfamiliar to most Japanese as well as other foreigners,” said Taketaro Kotani, president of NYK Lines North America Inc. and chairman of the public relations committee at the Japanese Chamber of Commerce and Industry of New York.

Helping companies in Japan learn about American-style corporate philanthropy is Japan’s powerful Keidanren (Japan Federation of Economic Organizations). Its Council for Better Corporate Citizenship--until recently the Council for Better Investment in the U.S.--helps Japanese companies doing business here become acquainted with regional U.S. practices and cultures.

“We don’t want to jeopardize the U.S.-Japan relationship because of ignorance,” said Sadami (Chris) Wada, senior vice president, government affairs, at Sony Corp. of America and adviser to the council. “Japan is not purposely interested in breaking traditions and customs of America. We want to be liked by our American friends.”

Late last year, the council, together with the Japan Center for International Exchange, sponsored a conference in Tokyo on “becoming a good corporate citizen in the American communities.” Representatives of the council plan to visit Japanese companies in New York and Los Angeles in April for two-day presentations on corporate citizenship.

Meanwhile, the council is encouraging the Japanese government to provide tax credits for donations to communities in foreign countries.

Volunteerism

In other efforts, the Japanese Chamber of Commerce and Industry in New York has assembled a booklet titled “Joining In, A Handbook for Better Corporate Citizenship in the United States,” with suggestions on how its 350 members can become involved in American communities.

The how-to guide outlines the need for corporate community involvement, step-by-step procedures for starting a volunteer program, a mini-directory of resources, and ways to publicize and track the progress of such programs.

“Money is not enough. We’ve come to acknowledge the necessity to contribute our time, our work force and our commitment,” explained Teruhiko Maruyama, senior vice president for Tokio Marine Management Inc. in New York, the U.S. subsidiary of Tokio Marine. Maruyama has become involved with the Boy Scouts on Long Island because of his 14-year-old son.

Meanwhile, the Japan Business Assn. of Southern California has established its Committee for a Better Investing Environment to help its 625 members become better corporate citizens. Mayumi Sakai, deputy executive director, said the association has had an ongoing collective program to donate money and equipment to local schools and educational programs.

In addition, JBA members are raising $325,000 for their annual contribution to the Music Center in downtown Los Angeles. That would lift their donations to the theater facility to about $1.2 million over the past five years. Yukiyasu Togo, president and chief operating officer of Toyota Motor Sales USA in Torrance, is leading a fund-raising effort that so far has collected more than $800,000 from Japanese and other Asian businesses for the Los Angeles Festival, an arts and culture fair held every September.

Many Japanese companies such as Sony and Toyota, which were among the first to open offices in the United States, continue to make individual contributions to their local communities. Toyota donated $1 million last month to five groups in Torrance, including the city’s new Cultural Arts Center, South Bay Volunteer Center and South Bay YMCA.

David Creigh, executive vice president at Huika America Corp. in San Pedro, said his company, a Japanese exporter of scrap steel, has had a corporate citizenship program since 1982--long before recent criticism of Japanese investment. “The owners of this company and management of this company had a sense of community long before this came to the fore,” he said.

Huika donated $18,000 in television and videocassette recorder equipment last month to schools for the disadvantaged in the Los Angeles area. Last year, it made a $35,000 donation to help plant 10 million trees in Los Angeles by the turn of the century.

Often, however, efforts by Japanese companies are not greeted with enthusiasm. “Initially there was some suspicion in the philanthropy community” when Hitachi formed a U.S. foundation in 1985, recalled Delwin A. Roy, president of the Hitachi Foundation in Washington. “It was the feeling, ‘Here come the Japanese. Why won’t they leave anything alone?’ ”

Today, the Hitachi Foundation, which funds educational, international and cultural programs, is one of 11 U.S. foundations endowed by Japanese companies. These foundations, supported by companies such as Sony, Toyota and Matsushita, have given away a total of $15 million. “As a group of foreign investors, much more is demanded--not asked--of Japanese investors,” observed Roy, noting that most British, Canadian and European companies with investments in the United States have not felt the need to establish foundations.

Nakamura told his Tokyo audience that the motives of Japanese companies are questioned, despite their good intentions. When Japanese companies recently donated $9.5 million to relief efforts within days after the San Francisco earthquake, a story in the San Francisco Examiner raised the question of whether the firms were donating “in an effort to win friends and influence people.”

Personal Touch

Japanese firms also want to show that they have a heart, not just money. Dentsu’s Nakamura and his associates are encouraging Japanese executives and their families to donate their time to charitable and community activities.

“Americans relate to personalities, not institutions,” explained John K. Wheeler, vice president of the Japan Society in New York. But, he says, “a Japanese person is not willing to stand out. It is not a society to get up to grandstand. In fact, it is against that.”

As a result, luring Japanese executives to community events apparently is easier when they know other Japanese firms and managers are participating. “We’ve been criticized for being faceless Japanese companies,” explained Nobuo Kimura, chief executive director at the Los Angeles office of the Japan External Trade Organization.

He encourages Japanese firms to become involved in local business organizations such as the World Trade Assn. of Orange County. “When I came here two years ago, the chairman complained that there were so many Japanese companies here (in Orange County)--100 to 150--but none of them came to talk or were willing to be members.” At the Orange County trade association’s recent Japan America Friendship Dinner, about 100 of the 200 attendees were representatives of Japanese companies.

Still, Japanese management assigned to the United States rotates out of the country--usually back to Japan--every three to five years. As a result, just as one manager becomes familiar and comfortable outside his company, he is usually dispatched elsewhere and the get-acquainted process must start over with his successor.

On the East and West coasts it is easy for Japanese managers and their families to become isolated from their American neighbors because of the large concentration of expatriates and the vast availability of Japanese-language schools, stores and services.

That is less likely in rural America. When 20 Japanese families first settled in Walworth, Wis., after Kikkoman Foods Inc. opened a soy sauce plant in 1973, they avoided clustering together and made an effort to scatter within the farming community of 1,100.

“That kind of achieved an understanding between the Americans and Japanese and helped them to assimilate faster. It exposed Japanese people to a farming town, which had had no Asian people before,” said Bill Nelson, assistant vice president. Meanwhile, Kikkoman supports local scholarship programs, the 4-H club, Future Farmers of America, United Way and other local charities and events.

At the Nissin Foods plant in Lancaster, Pa., both Japanese and American traditions are shared to create better understanding of the two cultures. One day each spring, production lines for Cup O’ Noodle and Oodles of Noodles are halted for a cherry blossom festival at the plant. Employees munch on shrimp tempura while viewing 150 blooming cherry trees that the Japanese food maker planted.

Later in the year, employees and their spouses head for a local hotel for a big Christmas bash that includes dinner, dancing and a turkey for each family. Another enjoyable feature: the bonus checks handed out by their Japanese bosses.