Foreign securities companies may be steadily gaining a foothold in Japan, but many of the Japanese now working for them have a tough time compared with when they used to work at domestic commercial banks and securities firms.
Top management at the foreign companies’ units here are usually either former chairmen or vice presidents of major Japanese commercial banks or former heads of Finance Ministry bureaus.
And in the last few years, an increasing number of elite bureaucrats in the Ministry of Economy, Trade and Industry and the Finance Ministry are joining foreign-affiliated securities companies.
Reiji Terasaka was a career-track bureaucrat who was a section chief in the Finance Ministry’s Budget Bureau before quitting in 2000 and joining Merrill Lynch Japan Securities Co.
In June 2003, he went to the Carlyle Group, a major U.S. investment fund.
“There’s no change in my desire to work for Japan, but I wanted to make my contribution to society from the microeconomic viewpoint (of a company) rather than at the macroeconomic level (of drafting state policies),” the 33-year-old said.
Terasaka became interested in corporate rehabilitation when he was studying in the United States. All career-track officials are sent to foreign countries to study for a certain period.
But in 1998, two years before he quit, the Finance Ministry was rocked by a series of corruption cases, eroding its morale. After the scandals broke, the number of people quitting the ministry increased sharply, forcing it to look at whether its study-abroad program should be suspended.
Because Terasaka had no business experience, he went to the U.S. again to study at his own expense after leaving the ministry.
At the Carlyle Group, he was involved in buying the personal handy-phone system division of KDDI Corp.
“The job is tough, but I feel it’s worth it because I can take part in actual corporate rehabilitation and see firms get better,” he said. His goal is to eventually start his own company.
Akira Morio, who was in charge of corporate purchases in the New York head office of Goldman Sachs during the first half of the 1990s, was formerly with the Industrial Bank of Japan. IBJ merged with two other banks to form what is now the Mizuho Financial Group. He now works as an adviser for a law firm.
Regarding differences between foreign brokerages and Japanese banks, he said, “At foreign companies it’s a sprint race (to get results every year), but workers at Japanese companies are in a marathon.”
Those who change jobs and join foreign companies have to produce solid results in a short period of time, and if that does not happen fairly quickly, dismissal — whether direct or indirect — can easily become a reality.
An executive of a major Japanese securities company said that many people at Japanese securities companies “were under the illusion they were capable, although they were actually able to work thanks to their companies’ systems.”
“In fact, there are only a handful of Japanese who have been highly successful since moving to foreign companies,” the executive said.
Competition to get a job at foreign securities companies among graduates of top-level universities such as the University of Tokyo, Waseda University and Keio University has been rising, with students yearning for higher salaries at the outset of a career compared with what Japanese companies offer.
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