Pernille Rudlin - Rudlin Consulting

About Pernille Rudlin

Pernille Rudlin was brought up partly in Japan and partly in the UK. She is fluent in Japanese, and lived in Japan for 9 years.

She spent nearly a decade at Mitsubishi Corporation working in their London operations and Tokyo headquarters in sales and marketing and corporate planning and also including a stint in their International Human Resource Development Office.

More recently she had a global senior role as Director of External Relations, International Business, at Fujitsu, the leading Japanese information and communication technology company and the biggest Japanese employer in the UK, focusing on ensuring the company’s corporate messages in Japan reach the world outside.

Pernille Rudlin holds a B.A. with honours from Oxford University in Modern History and Economics and an M.B.A. from INSEAD and she is the author of several books and articles on cross cultural communications and business.

Since starting Japan Intercultural Consulting’s operations in Europe in 2004, Pernille has conducted seminars for Japanese and European companies in Belgium, Germany, Italy, Japan, the Netherlands, Switzerland, UAE, the UK and the USA, on Japanese cultural topics, post merger integration and on working with different European cultures.

Pernille is a non-executive director of Japan House London, an Associate of the Centre for Japanese Studies at the University of East Anglia and she is also a trustee of the Japan Society of the UK.

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Here are my most recent posts

Japanese manufacturing in the UK – resilient, but not growing

Excluding automotive production, Japanese manufacturing operations in the UK have been relatively stable since 2015/6. Out of 200 or so companies, only a handful of companies have closed in the past five years, and much of this was to do with consolidating operations rather than withdrawing entirely from the UK. Many of the Japanese manufacturers date back to the 1970s, and the oldest established, YKK, has been manufacturing in the UK since 1966.

There have not been many new entrants either over the past five years – apart from Mechatronics (owned by JTEKT) and other “new” entrants which are the UK subsidiaries of American or Swiss operations acquired by Japanese companies such as Stolle (acquired by Toyo Seikan), Hitachi Energy (was ABB Power Grids) and Avista (acquired by Kurita)

M&A

Around two-thirds of the companies in this sector are the product of, or have conducted M&A in the UK. Japanese M&A activity across the UK and Europe has dwindled away in recent years, perhaps because of the difficulty of doing due diligence in a pandemic, or Brexit making acquisition of a UK manufacturing operation that may be part of an EU supply chain less attractive. There does not seem to be any particular trend to acquisitions in the UK, other than clusters of purchases in packaging, agrochemicals and food processing.

Notable recent acquisitions of UK companies include:

Hitachi Rail acquiring Perpetuum (2021)
Olympus acquiring medical device maker ARC Medical Design (2020)
Mitsubishi Heavy Industries acquiring the remaining stake in Primetals from Siemens, Hitachi and others (2019)
Sumitomo Heavy Industries acquiring Invertek Drives (2019)
Nippon Suisan acquiring Caistor Seafoods and Flatfish (2017-2019)
Rengo acquiring various packaging companies such as Tri-Wall and Welsh Boxes (2016-2020)
Agrovista (owned by Marubeni) acquiring various British agrochemical companies (2016-2019)
Sanwa acquiring Bolton Gate Services (2018)
Calbee acquiring Seabrook Crisps (2018)
Sansetsu (packaging) acquiring Truckwright (2018)
Sintokogio acquiring Omega (foundry machinery) (2018)
Konica Minolta acquiring Charterhouse and Indicia (printing) (2017-8)
Taiyo Nippon Sanso acquiring US company Praxair’s European gas business (2018)

Employment

Around 39,500 people were employed in the UK by non automotive Japanese manufacturers in 2015/6 and after a few years of growth to around 42,000, this fell to 39,167 in 2020/21. Judging by the results of the 60 or so companies who have reported for 2021/22, this downward trend is continuing. If automotive manufacturing employment is added back in, there were around 60,600 people employed in Japan-owned manufacturing in the UK in 2020/21, almost the same as were employed in 2015/6. As we explained elsewhere, this number is likely to fall in 2021/22 with the closure of Honda Swindon and other suppliers to Honda.

UK and Europe

How this compares with other European countries can be seen in the chart on the left – which shows the numbers of all manufacturing companies in Europe, including automotive. According to Toyo Keizai, the number of Japanese manufacturers in the UK dipped around 2017/8, but recovered, with another more recent fall. But there was growth overall since 2015/6, with 228 companies in 2021/2 compared to 215 in 2015/6 – a 6% increase. This is much lower than the overall 20% growth in Europe, and as a consequence the UK is no longer the largest host of Japanese manufacturers.

The number of Japanese manufacturers in Germany has grown 35%, and growth is continuing, widening the gap with the UK. France is a clear third, and is showing signs of growth tailing off. Netherlands, Turkey, Poland and Nordic countries are showing higher than average growth as hosts.

The growth of the number of Japanese manufacturing operations in Europe of 20% since 2015/6, from 1,147 to 1,381 companies was actually higher than the growth seen in Asia (7% to 9,047) or the USA (13% to 1,563). The number of Japanese manufacturing operations in Africa has grown 25% over the period – but from a much lower base of 57 to 71.

Japanese manufacturing in the UK “despite” Brexit has remained stable thanks to the resilience built up by those companies through being long established in the UK, benefitting from Japan HQ risk aversion and long term planning and having experienced, local management. These factors have not attracted the growth seen in other countries in Europe, however.

A directory of 205 Japan owned companies with production facilities in the UK, giving their full names, parent company, type of business and latest number of employees is available for £20 + VAT. Please contact us for an invoice and payment details via PayPal.

For more content like this, subscribe to the free Rudlin Consulting Newsletter. 最新の在欧日系企業の状況については無料の月刊Rudlin Consulting ニューズレターにご登録ください。

A very timely introduction of a new trade compliance diploma from the International Trade Institute

We thought the new trade compliance diploma from the recently-established International Trade Institute would be of interest to Japanese companies operating in Europe, struggling with additional complications post-Brexit. Now that various sanctions are being introduced against Russia, it seems even more timely.

It is the first University-recognised diploma that is international in scope – recognised as a qualification not only in the UK but also Ireland and at the EU level. The facilitators are trade experts themselves, with many years of consulting on trade compliance around the world. The course is a programme of seven modules of a high level but practical curriculum, spread over three months at times convenient to participants, with online modules and live sessions.

The Institute has had early success in attracting participants with job roles such as logistics specialist, trade compliance manager, warehouse supervisor and shipping manager from global brand US and other multinational companies to the Diploma Programme.

The next course is starting on June 9th, and a further intake is scheduled for September. Further information is available from www.internationaltradeinstitute.com.

UK no longer the biggest host of Japanese automotive manufacturing in Europe – and the rise of Africa

For many years the UK was host to the largest number of Japanese automotive manufacturers and their employees in Europe. This was thanks to Toyota, Nissan and Honda all having factories there. which in turn attracted a large number of automotive suppliers to set up plants near by.

Last year (2020-1) Poland took over the number one spot from the UK in terms of numbers of Japanese automotive manufacturing employees in the EMEA region. According to our estimates, the UK will slip to 6th position in 2021-2022, due to the closure of Honda‘s Swindon plant, along with many of its suppliers shutting down operations. It will be overtaken by Czech Republic, Germany, Turkey and Morocco.

There has been strong growth in employee numbers in Africa in particular – mainly in Morocco, South Africa and Egypt. This looks set to continue as labour intensive wire harness manufacturers diversify production away from Ukraine and other Eastern European countries. South Africa has also seen more investment from Nissan and Toyota in their plants there over the past few years. Isuzu also has a plant in South Africa, in addition to manufacturing in Russia and Turkey.

Nissan’s other plants in the EMEA region, apart from the UK and South Africa are in Russia and Spain (the Avila and Cantabria plants continue to operate, after the closure of plants in Catalonia) and Egypt. It has just opened a vehicle assembly plant under licence to Japan Motors, in Ghana.

Suzuki has plants in Hungary and Egypt and Toyota now fully owns the factory it used to joint own with PSA in Czech Republic, in addition to its plants in the UK, France, Turkey, Russia and Portugal as well as engine and transmission factories in the UK and Poland.

Although Poland does not have any Japanese OEM car manufacturers based in it, it still tops our ranking in terms of employment, not just because of the Toyota engine plant, but also the other Japan owned automotive suppliers with labour intensive manufacturing there, such as Bridgestone, NGK, Pilkington, NSK, Sumiriko and the wire harness manufacturers. Similarly, Germany is not host to any Japanese automotive OEMs, but is host to many mid sized Japanese automotive and other industrial component manufacturers.

In terms of actual numbers of Japan owned automotive manufacturers, we estimate the UK is still top of the table with 67, despite the closure of 11 such operations in the past few years. Toyo Keizai’s database has Germany and the UK neck and neck, with around 31 or 32 “transportation equipment” manufacturers – a category which excludes automotive suppliers who manufacture components such as tyres. In Germany‘s case, many of these manufacturers do not just supply the automotive industry, and it has been a trend for some UK based manufacturers too, trying to diversify away from overreliance on core Japanese automotive customers.

This difficulty in categorizing industrial suppliers has caused some glitches in Toyo Keizai’s numbers, it would seem, but overall, the trend over the past five or so years is clear – the numbers of Japanese manufacturers hosted by Germany, Italy, Czech Republic and France have grown over the past few years, but that growth seems to have tailed off. Host countries with fewer Japanese automotive manufacturers than five years ago according to Toyo Keizai are Russia, the UK and Belgium. South Africa, with 16 Japanese automotive manufacturers by our estimates, and 8 by Toyo Keizai’s, is not showing many signs of growth in the numbers of Japanese companies it hosts – yet.

One further clue to the future of Japanese automotive manufacturing in the region can be found from the foreign direct investment data published by Japan’s Ministry of Finance. The cumulative investment over the past five years is summed up in the chart to the left. Clearly there has been some disinvestment from the UK and Belgium recently and a large investment in Germany in 2019. There have been no major M&As to cause this, the investment is more likely to be the Japan headquarters of major manufacturers transferring capital to their regional headquarters (Toyota in Belgium, Sumitomo Electric Bordnetze and Yazaki in Germany and Denso in the Netherlands) for further onward investment in the region. For the UK, the disinvestment is likely to be Honda and its suppliers, and the investment would be from Nissan and its suppliers.

UAE and Japanese companies – diversity and decarbonization

A TV series called “Inside Dubai: Playground of the Rich” is currently showing on the BBC in the UK which features British people who have made Dubai their home, who are “soaking up the sun, glamour and tax-free benefits” of Dubai, “but must also follow the rules” of their host country and cope with “the frenetic pace of change.”

“Tax free luxury and oil” is the image most British people have of Dubai – particularly since the pandemic, when many British celebrities went to Dubai on holiday when allowed. They posted photographs of themselves enjoying the sunshine on Instagram with a backdrop of extravagant architecture behind them. But at the same time, there is discomfort that the British in Dubai are behaving in old fashioned colonialist ways, while many people of other ethnicities in Dubai are having a much tougher life. There is also a nervousness about human rights violations, and the strict rules on alcohol, adultery and homosexuality.

This image rather contrasts with the conclusions of a recent report from JETRO saying that Japanese companies were attracted to the Middle East as a place to develop business in renewable energy and decarbonization, with the UAE ranking second behind Saudi Arabia as the country of most interest.

I was already aware that the UAE was the biggest host of Japanese companies in the Middle East. I had visited there a couple of times a few years’ ago to provide cross cultural training to a Japanese bank there and spent some time trying to understand the cultural complexity of a society which has the highest proportion of immigrants in the world.

This knowledge came in useful recently, when I was asked by a Japanese energy company to support them in a diversity and inclusion training in the UAE. This was part of a wider initiative to be more inclusive, to listen to the ideas of all employees, regardless of age, gender or ethnicity, in order to encourage innovation, particularly with regard to decarbonization.

Dubai is currently hosting an Expo which is strongly emphasising ESG in its themes. There is a Programme for People and Planet, which is aimed at the “open exchange of new ideas and innovations,” placing equality, universal respect and human dignity at the centre of human progress.”

In preparation for being an expo host, and to encourage more foreign direct investment, the rulers in the UAE had already identified that a robust legal framework, which was more tolerant of diversity, was going to be necessary. There are now new laws on anti-harassment and anti-discrimination, particularly in the special economic zones, as well as a relaxation of alcohol laws and Islamic personal laws.

So I can now see why Japanese companies are feeling more positive towards the UAE again, both as a place to develop business, but also as country where the legal framework is coming more into line with the acceptance of the diversity that is needed for companies to change and evolve.

This article by Pernille Rudlin was first published in Japanese in the Teikoku News, 9th February 2022

Trends in Japan owned financial services companies in the UK

Around 14,000 people worked for 85 Japan owned financial services companies in the UK in 2021. This is around 1,000 more people than in 2016, the year of the Brexit referendum. Although all the main banking, securities and insurance groups (Mizuho, MUFG, MS&AD, Nomura and SMFG) opened or strengthened EU entities as a Brexit countermeasure, it does not seem as if large numbers of jobs have shifted to those entities, or that there have been layoffs in the UK, and large scale hiring in the EU.

The surface calm does mask some restructuring, however, which are difficult to detect in the case of MUFG and Mizuho, as their banks in London are run as branches (of the Netherlands European HQ in MUFG’s case, and of Tokyo HQ in Mizuho’s case), and therefore do not have to publish company accounts with official employee figures. It was reported that MUFG offered 500 directors redundancy packages in 2019, but at the same time, subsidiaries such as Mitsubishi HC Capital and MUFG Securities have been growing substantially, with further employees added to the group through the acquisition of First Sentier Investments.

Rival banking group SMBC has incorporated its subsidiaries in the UK and its European headquarters is in London, so more accurate figures are available, which show employee numbers at the bank have grown by 45% to 1,246 from 2016 to 2021.

Nomura International on the other hand has 29% fewer employees in 2021 than it did in 2016, but a recent hiring spree has brought its London employee total back up to over 2,000 according to its annual report released in 2022. The Daiwa group has also grown, particularly on the corporate advisory side.

Recent growth in employee numbers has been more organic than through M&A. The only acquisition since MUFG acquired the Australian investment firm (with substantial presence in the UK) First Sentier in 2019 has been Orix acquiring Gravis Capital Management and SBI acquiring B2C2, a cryptocurrency firm employing 46 people.

Closures in the past 4 years include Finatext UK, Spitalgate Dealer Services (which was providing financing for Mitsubishi car dealers), Speedloan Finance – a pawnbrokers acquired by Daikokuya in 2015 and the branch offices of Okasan Securities and the Bank of Yokohama.

It may be that the apparent stability of Japanese companies in the UK was partly the result of a delay to relocations to the EU caused by the pandemic, and that further friction with the EU may lead to pressure being brought up on financial services companies to shift more of their business to the Continent. A further factor is the extent to which London is still seen as the place to learn about and develop the new business areas which Japanese financial services companies are investing in.

Examining the statistics from Japan’s Ministry of Finance on direct investment flows, it seems the UK benefitted from a big inward investment from Japan into the finance and insurance sector in 2016, then there was net disinvestment in 2017-2019, and then increasing net investment in 2020-21. Conversely, there was little investment into Ireland, Luxembourg or the Netherlands in 2016, but major investments into their finance and insurance sectors in 2017, 2018 and 2020-21.

A directory of 85 Japan owned financial services companies, giving their full names, parent company, type of business and latest number of employees is available for £10 + VAT. Please contact us for an invoice and payment details via PayPal.

Working from home means you won’t get promoted – in Japan and elsewhere too?

Even before the pandemic, Japanese employees only took around half of their paid leave. I remember 30 years’ ago the company union of my Japanese workplace campaigning every year to get its members to take more than the 10 or 11 days holiday a year they would take out of the 24 or so they were due. In the USA around 70% of paid leave is taken and in Europe it’s closer to 100%.

Professor Hajime Ota of Doshisha University points out that this is partly because in many Western countries, companies must compensate employees for holidays not taken or are required to make employees take holidays – in the financial services industry in the UK for example. Japan is also facing a labour shortage, so people feel under pressure to do overtime instead.

A 2010 survey by the Japan Institute for Labor Policy and Training found that the top reasons for not taking paid leave were: “because it would cause problems for my co-workers”, “because other employees are not taking their annual leave” and “my boss is not happy about me taking leave”. Similarly, a 2005 survey found that people were working overtime because “my boss and co-workers are doing overtime” and “it is difficult to leave the office if others are still working.” So it is basically social pressures – face time overtime – that are at the root of this.

Overtime pay is lower in Japan than elsewhere too – 25% of normal pay as compared to 50% or more in Europe or the USA. Also many Japanese employees are doing “service overtime” where they are not getting paid at all, even though this is supposedly illegal.

Professor Ota says that this shows Japanese employees want the approval of their co-workers and boss rather than extra money for their overtime. People who take all their leave and only work their set hours are looked askance at. So it is understandable that working from home and flexible working, workations and so on are not popular in Japan – unless all employees take it up.

As I have frequently said, and Professor Ota confirms, in many Japanese workplaces there are no clear job descriptions, so it is difficult to evaluate individual performance objectively. The feelings and emotions of the evaluator tend to be more influential. A 2001 survey of 1,406 white collar workers in Japanese and Western companies found that 75% of Western respondents said that they would not give softer evaluations to subordinates just because they were pleasant to work with whereas 29% of Japanese respondents said they would not. Conversely 6% of Western respondents said they may give a softer evaluation to a pleasant subordinate and 20% of Japanese respondents said they would.

Western respondents may well be fooling themselves that they are capable of such objectivity, and Japanese respondents are being more honest. Professor Ota also puts it down to the importance of the “in-group” in Japanese workplaces, and therefore the need to be “close” to your boss in all senses. But this concern that working from home impacts promotion negatively is not confined to Japan – as many recent articles and surveys publicised in the Western media confirm.

The future of British hospitality industry

Now almost all restrictions on social distancing have been lifted in England, we can start to see what changes have happened in our cities, and take a guess to whether these changes are permanent.

Some trends were already apparent before March 2020. For example, many of the large chain stores were struggling for years, and are now permanently closed. New, smaller shops have started up, mainly selling interior goods or takeaway food.

The restaurants and pubs have reopened, but often for only a few days a week. There is a staff shortage, not just due to employees having to stay away from work because of coronavirus. For some restaurants, half their staff had come from EU countries, and those staff have now returned home. Young, British people are not interested in the long hours and low pay, and lack of career prospects in the hospitality sector.

People are very happy to be able to eat and drink out again, of course, but nervous about being in crowded indoor spaces. Many cities decided to take advantage of the lockdown period, to set up more so-called “low traffic neighbourhoods”. This means that large plant containers and railings are erected, narrowing the roads and enabling the cafes and bars to put tables and chairs on the wider pavements.

Low traffic neighbourhoods have not been universally welcomed. There are concerns that business will be affected if customers cannot now park nearby. There have been incidents where fire engines and ambulances have to take longer routes to get to emergencies. The British weather is not ideal for eating outside, but the British have been so determined that they just wrap up more warmly and sit outside under umbrellas and tents put up by the cafes, even in the wind and the rain.

British cities are starting to look more like continental European cities, as a café culture emerges. A property developer confirmed to me that this was also a pre-coronavirus trend. He used to be a nightclub owner, but realised that clubbing was a dying industry. Supermarkets selling cheap alcohol means that young people “pre-load” on alcohol at home before going out, rather than spend a lot of money on expensive drinks at nightclubs. They would rather meet in pubs and cafes with no entrance fees. They find people outside their friendship group through online dating sites rather than nightclubs.

Our city council had tried to create a “night-time economy zone” ten years’ ago, clustering the nightclubs on one road, so that they could be policed more easily, and the noise contained within one area. We live not far away from this road, and when we first moved to this city 7 years’ ago, we used to suffer from music being played too loudly, later than allowed, from various venues. Now one of the nightclubs is a vegan restaurant, another is being converted back into apartments and a third has become a serviced office building – with a café on the ground floor.

This article was originally published in Japanese in the Teikoku News on 8th September 2021

Top 20 Japanese Employers in Ukraine

We’ve managed to track down 44 Japan owned companies in Ukraine, employing around 12,700 people. According to Teikoku Databank, there are 57 such companies and branches of Japanese organisations.

By far the largest Japanese employer in Ukraine is Sumitomo Electric Industries, with nearly 7,000 employees, manufacturing wire harnesses for the automotive industry. Japanese media say that Hitachi employs around 7,200 people in Ukraine via their recent acquisition, GlobalLogic. It seems likely many of these are on a contract basis rather than a permanent basis, as Dun & Bradstreet only records 49 employees and Kompass 1000-4999. [Later addition – this seems to be correct – probably US IT contractors helping Ukraine build up cyber defences]

The second largest Japanese employer is Fujikura and the third largest is Yazaki, both also manufacturing automotive wire harnesses.

According to Nikkei Asia, both Sumitomo Electric and Fujikura have shut down their plants, as has Japan Tobacco.

Japanese trading companies also have a presence – Sumitomo Corporation, Itochu (operating Suzuki dealerships via Auto International), Marubeni and Mitsui. Japanese pharmaceutical companies Takeda and Astellas also employ a few hundred, as does Dentsu, the advertising agency.

No Japanese car brands are manufactured in Ukraine, but Nissan, Toyota and Subaru all have operations there.

There is an IT hub in Lviv, and various Japanese IT and consumer electronic companies do have a presence in Ukraine, such as Renesas, Rakuten, Konica Minolta, Panasonic and NTT.

How does this compare to Russia? Please see here.

Top 30 Japanese employers in Russia

Around 35,000 employees in Russia worked for 224 Japan owned companies and operations at the beginning of 2022, according to our calculations. This makes Russia the 11th largest host of Japanese companies in the European region by employee number – if Russia can be included in Europe. Teikoku Databank has identified 347 Japanese companies in Russia, an increase of 60% over the past 13 years.

Russia is Japan’s 17th largest trade partner. Japanese exports to Russia are particularly dominated by vehicles and automotive parts. Localization of the automotive supply chain is not well advanced in Russia. As a consequence, some Japanese suppliers have been re-routing parts which would have come via Ukraine from Hungary to be transported via Belarus. There is concern that Western sanctions may result in the halt of parts exports to Russia.

The largest employer is Japan Tobacco (JTI) which has five production sites in Russia, two making cigarettes, the others making intermediate supply chain products.

The second largest Japanese employer in Russia is Toyota Motor, which has a plant in St Petersburg, manufacturing the Camry and RAV4. Nissan, the fourth largest Japanese employer, also has a plant in St Petersburg, making the X-Trail, Qashqai and Murano for the Russian market. Because of Toyota and Nissan’s presence, there are many other automotive suppliers in the the Top 30 (see below for download) including AGC making automotive glass, Yazaki (wire harnesses), Bridgestone, Marelli (was Calsonic Kansei, a Nissan supplier), Toyota Boshoku, Nippon Sheet Glass (Pilkington) and Denso. Mazda also has a joint venture with Sollers in Russia, manufacturing cross-over cars and engines.

Japanese pharmaceutical companies also feature in the Top 30 – Takeda and Astellas and of course the Japanese trading companies have a substantial presence – Sumitomo Corporation, Sojitz and Mitsubishi Corporation. Itochu seems less prominent, but has signed a memorandum of understanding with Gazprom for an LNG plant in the Baltics, so there may be some behind the scenes investment going on that we have not identified. Mitsui also seems to be taking small stakes and investing in energy projects and Marubeni also seems to be involved in various investments in technology, chemicals, energy and infrastructure.

SBI Holdings, previously a SoftBank company, owner of Shinsei Bank, is at #25, with SBI Bank in Russia, and is the only Japanese financial services company that appears in the Top 30.

And how does this compare to Ukraine? Please see here.

Updates on Japanese companies in Russia (as of 14th December 2022)

Japan Tobacco: Has suspended marketing activities and launch of new product in Russia. Production is still continuing at its 4 or 5 plants in Russia. It employs around 14,000 people across EMEA, over 3,000 of them are in Russia. 388 were employed by JTI in Ukraine.
Toyota Motor: Has decided to end production at its St Petersburg plant (announced September 23 2022). Toyota employs over 24,000 in EMEA – around 3,000 are in Russia. 174 people were employed in Ukraine.
Toyota Tsusho: the trading arm of Toyota group is “buying time” with their Russia operations according to the Yale CELI list. Employs over 2000 people in Russia and over 19,000 in EMEA.
Uniqlo/Fast Retailing : Initially announced its 50 stores in Russia would continue to operate, then that would shut them. Donating $10 m to the UNHCR. The company also will ship 200,000 items of clothing including blankets, underwear and jackets to Ukrainian refugees in Poland and elsewhere through the UNHCR. Has over 3,300 employees and 117 stores in Europe, which would as a rough estimate mean Uniqlo has around 1,400 staff in Russia – Dun & Bradstreet estimates 2,060.
Takeda: says it will not start any new clinical trials in Russia, and has stopped making any new investments. Local ongoing trials and supply will continue. It employs around 1,873 people in Russia, out of over 8,500 in EMEA. 138 people were employed by Takeda in Ukraine.
Nissan: Sold its Russia business for less than a dollar in October 2022 to a Russian state owned company. Had halted production due to “logistical challenges”. Employed 1,557 people in Russia out of nearly 14,000 across the EMEA region. 175 were employed in Ukraine.
Nippon Sheet Glass/Pilkington: has suspended trading – employs 366 in Russia, out of 12,000 employees in EMEA.
Toyota Boshoku: has decided to end business in Russia (Sep 2022)– employed around 364 people in Russia, out of over 4,000 in EMEA
Dentsu: Employs 1,500 people in at least 7 different companies in Russia (including Aaron Lloyd, Amnet, iProspect, Vizeum, Carat, Posterscope). Has announced it is pulling out and selling share to partners. It employed around 450 people in Ukraine and over 14,000 in EMEA.
AGC: has suspended sales of architectural + automotive glass in Ukraine (24 employees). It will suspend investment including regular repairs of glass manufacturing kilns in Russia + reduce production + shipments to local automotive manufacturers. AGC employs around 17,000 people in the Europe, Middle East and Africa Region, around 10% of them are in Russia.
Yazaki: no announcements on the status of its operations in Russia, classified as “Digging in” by Yale CELI- employs around 1,700 people in Russia out of over 44,000 in EMEA region. 1,079 were employed in Ukraine.
Sumitomo Corporation: SMBC Aviation Capital, jointly owned with SMBC, to terminate leases of aircraft to Russia. Owns Summit Motors, Sumitec International in Russia (around 1,000 employees) and has minority shares in Terneyles, Russian Quartz and PTS Hardwood, STS Technowood (another 2,700 employees). Has 7,650 employees in EMEA. Says “currently, we are suspending or scaling-back any Russian-related businesses.” 768 people were employed in Ukraine in Sumitomo Corporation owned companies.
Sato Holdings: acquired Russian packaging and labelling firms Okil and Okil Sato X Pack in 2014 have ceased sales to Russia and are looking at all possible alternatives – they employ around 760 people in Russia, around $58m sales.
Bridgestone: will suspend production in Russia and also exports to Russia. Will continue to pay employees. Russia represents about 2% of its turnover. Is donating Y500m to supporting Ukrainian refugee relief. Employs over 700 people in Russia, out of 12,000 in EMEA.
Hitachi: Hitachi group is to suspend exports to Russia “apart from products, services and support for electrical power equipment indispensable to the daily lives of people.” Hitachi Construction Machinery has made decisions to gradually suspend production at Hitachi Construction Machinery Eurasia (300 employees). Over 650 employees in Russia, including Hitachi Energy, Hitachi Vantara and Vantec. Russian revenues account for approx 0.5% of Hitachi’s consolidated revenues. Hitachi apparently had over 7,000 employees in Ukraine, via its US acquisition GlobalLogic. Over 32,000 people work for Hitachi group companies in EMEA.
Sojitz: Joint venture plant with Isuzu will cease operations. Over 650 employees in Russia, in Center Sunrise, U Service Sunrise car dealerships and Subaru Motors.
Astellas:　Donated Y10m to UNICEF. Has stopped recruiting new patients to participate in clinical trials in Russia and Ukraine. It employs around 635 people in Russia (this figure is 3 years’ old) out of around 4,000 in EMEA. 244 people were employed in Ukraine.
Mazda: will stop exporting components to factory in Russia, but factory will continue to operate (7th March) – factory (50% owned by Mazda) employs over 550.
Mitsui: – employs around 500 people in Russia, in own operation and Komek Machinery. Classifed as “digging in” by Yale CELI list.
Komatsu: has suspended all shipments to Russia, employs around 487 people there, including in manufacturing, out of over 5,000 people in EMEA.
Mitsubishi Corporation: Will continue investment in Sakhalin 2 LNG project, along with Mitsui. As of 2015, MC had made over $1.17bn of investments in Russia. Employs over 450 people in Russia in MC Bank, MC Logistics, MMC Rus, MC Intermark Auto and Autospot, out of over 8,800 employees in EMEA.
Daido Metal: has over 450 employees in Russia manufacturing automotive bearings. No announcement has been made.
Yokogawa Electric: has around 400 employees in Russia. Has an international innovation center in Russia, in collaboration with Gazprom. No announcement has been made
IHI: 340 employees in Russia at its Alpha Automotive Technologies joint venture, has announced suspension of production.
Isuzu: announced suspension of production at its Russian joint venture plant with Sojitz. 280 employees in Russia.
Canon: Has suspended shipments to Russia. Has over 200 employees in Russia, including Canon Medical Systems, out of over 22,500 in EMEA.
SMC: 200 employees in Russia selling pneumatic tools, out of 3,300 in EMEA. No announcement.
Marelli: no announcement – employs around 123 people in Russia, out of 1700 in EMEA.
Denso: said on March 8th that were looking at pulling out their 2 expatriate Japanese staff from Russia, classified as “digging in” by Yale CELI – only has 27 employees at a sales company out of over 15,000 in EMEA.
Itochu: Will continue investment in Sakhalin 1 LNG project, along with Marubeni. Classifed as “digging in” by Yale CELI list. Has 174 employees in Ukraine.
Marubeni: Has offices in Russia and Marubeni Rubber. Less than 50 employees. Classified as “scaling back” by Yale CELI list
SBI Holdings, Mizuho, SMFG, MUFG have all pulled their Japanese expatriate staff out of Russia and have ceased transactions with Russian banks but are continuing operations with local staff. Yale CELI classified Mizuho as “digging in”, SMFG as “buying time” and MUFG as “withdrawal”

Hitachi power shifts

The management changes announced at Hitachi, in effect from April 1st 2022, reveal changes in the balance of power, not only in Japan headquarters, but Europe. Alistair Dormer, a British executive, who had been CEO of Hitachi Rail, and then became the first non Japanese Executive Vice President of Hitachi, was seen as a rival candidate to fellow EVP Tokunaga Toshiaki, to become President of Hitachi. In 2021, Dormer, resident in Japan, became Chief Environmental Officer and also Chair of Hitachi Europe, both perhaps an indication that he was sliding sideways away from the Presidency.

It now transpires that Dormer has retired from all his positions at Hitachi, apart from Chair of Hitachi Europe and will return to the UK. Kojima Keiji, who was already President, has strengthened his position by becoming CEO as well, following the current CEO, Higashihara Toshiaki, stepping down from the CEO position, but continuing as Chairman.

Kojima reorganised Hitachi from 5 divisions into three, focusing on “digital” systems and services and “green” energy and mobility as growth engines. “Green” was headed by Dormer but will now be directly managed by Kojima. Tokunaga, who spent some time in Silicon Valley, is heading up the “digital” side and is still seen as the hot favourite to succeed Kojima as President. He is quite literally Hitachi born and bred, having been born in Hitachi city, and his father also worked for Hitachi. He is only 55, which would make him the youngest President if he succeeds Kojima in the next few years. Kojima is ten years older than Tokunaga and became President in 2021. Previous presidents Higashihara and Nakanishi were in post for 7 and 4 years resepctively.

All is not lost in terms of having the first ever non-Japanese president of Hitachi, however. A possible successor to Tokunaga, if he is willing to wait that long, could be Claudio Facchin, who joined Hitachi in 2019 as a result of Hitachi’s acquisition of ABB Power Grids in 2020 and is now an executive officer and Senior Vice President of Hitachi, as well as CEO of Hitachi Energy.

The acquisition of ABB Power Grids led to a second shift in the balance of power within Europe. The acquisition resulted in around 15,000 employees joining Hitachi in the Europe, Middle East and Africa region, but did not have so much of an impact on HItachi’s presence in the UK, where its European headquarters is based.

In 2018-9 most of Hitachi’s EMEA staff were in the UK, working for Hitachi Rail and Hitachi Capital but now less than a third are working there.

A further acquisition, of Globallogic, in July 2021, is likely to shift the balance further. Even though it is an American IT company, it has a substantial number of employees in Eastern Europe, including Poland and several thousand who were until recently in Ukraine.

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