June 12, 2020
In September 2019, the Ministry of Economy, Trade and Industry (METI) inaugurated a “Review Committee on Approaches to Making Investment in Health and Productivity Management Visible” in order to further encourage companies and other organizations to engage in efforts for health and productivity management. Since then, the committee has been holding discussions on companies’ investment in health and productivity management and approaches that companies should take to make the effects of such management visible.
Based on the results of the committee’s discussions, METI formulated “Guidelines for Administrative Accounting of Investment in Health and Productivity Management” (hereinafter referred to as the “Guidelines”) as a reference for presenting a framework helping companies to effectively implement their health and productivity management and hold dialogues with external stakeholders involving various markets such as capital markets and, on June 12, 2020, released the Guidelines.
Background to the formulation of the Guidelines
As important elements in the process of advancing health and productivity management, companies should not only manage employees’ health as an obligation under the Industrial Safety and Health Act and other laws and regulations, e.g., regular medical checkups and stress checking, but also: conduct additional efforts for encouraging employees to maintain and improve health, which are necessary for companies and other organizations to solve challenges in business management, e.g., improvement of labor productivity; make smooth a plan-do-check-act (PDCA) cycle inside the companies and other organizations; and convey information on these efforts to external stakeholders.
The government, thus far, prepared some guidelines for future directions of efforts for health and productivity management, e.g., the “Guidebook for ‘Health and Productivity Management’ of Companies,” which is a revised first edition formulated by METI in April 2016, and, since FY2014, it has been conducting the Survey on Health and Productivity Management and a program for recognizing outstanding companies and organizations for their health and productivity management. In addition, against the backdrop that the private sector is requested to execute leadership in further activating companies’ efforts for health and productivity management, the government formulated the Guidelines, wishing to help companies meet such request in the future.
Outline of the Guidelines
Following the conventional efforts, e.g., the Survey on Health and Productivity Management, the Guidelines explain approaches to internal management that companies and other organizations need to take in order to more continuously, efficiently and effectively implement health and productivity management through their creativity and ingenuity for employees and other staff. Moreover, the Guidelines present common points of views that companies and other organizations should introduce in holding dialogues on the current situations of their efforts with external stakeholders.
The Guidelines adopt quantitative and monetary indices to help companies become aware of expenses for advancing activities and effects brought about by the activities through administrative accounting approaches. The definitions of health are broad and these quantitative and monetary indices are not sufficient to represent all of the definitions. However, METI believes that making the definitions “visible” by the indices will help not only individuals but also organizations make reasonable decisions and take sensible actions for enhancing health consciousness. Moreover, making these indices “visible” will foster common understanding and awareness of health among stakeholders having different standpoints, e.g., employees, business owners, communities and societies and shareholders, and this may contribute to companies’ dialogues with such stakeholders.
The Guidelines target companies that have already started efforts for health and productivity management and are yet seeking approaches to effective analyses and assessments as main users thereof. Companies and other organizations are expected to enjoy advantages based on the following perspectives by making use of the Guidelines in preparing a report on administrative accounting of investment in health and productivity management.
- Internal function: Companies are able to more continuously, efficiently and effectively implement health and productivity management; and
- External function: They are able to appropriately hold dialogues with external stakeholders concerning the current situations of their efforts for health and productivity management.
Effects brought about by the formulation of the Guidelines
METI expects that making use of the Guidelines, companies and organizations will voluntarily, proactively and flexibly engage in health and productivity management and gain appropriate recognition from a variety of markets, in particular, capital markets, and thereby the idea of health and productivity management will further disseminate and be established as one of Japan’s corporate cultures.