Investing in People Creates Social Wealth (Part 2)
In Part 2, Mr. Fukuhara, President and CEO of Institution for a Global Society, emphasizes the importance of education and an effective evaluation system for students’ career development as well as a harmonious and open society.
Masahiro Fukuhara, CEO & Founder of Institution for a Global Society (IGS)：
After graduating from Keio University, Mr. Fukuhara joined the Bank of Tokyo (currently MUFJ Bank). He holds an MBA from French business school INSEAD, a Master’s degree (with Honors) in International Finance from Grandes Écoles HEC (Paris), and a Ph. D. from the University of Tsukuba. In 2000, he joined Barclays Global Investors, where he became the company’s youngest-ever managing director and a director of the company’s Japanese subsidiary. In 2010, he founded IGS with the vision of “Inspiring self actualization through assessment and education.” Books he authors include Hābādo, okkusufōdo… sekai no toppu sukūru ga jissen suru kangaeru chikara no migaki-kata (Harvard, Oxford…Ways to Hone Thinking Ability Practiced by the World’s Top Schools)（Daiwa Shobo）; AI× biggudēta ga jinji wo kaeru (AI x Big Data Will Change Personnel Management) (Asahi Shimbun Publications); Nihon kigyō no potensharu o tokihanatsu ― DX× 3 P keiei (Unleashing the Potential of Japanese Companies — DX x 3P Management)（Eiji Press）; published January 11, 2022). He is also a specially-appointed professor at Keio University’s Faculty of Economics, and a Scott M. Johnson Fellow of the US-Japan Foundation.
I want to raise awareness of the importance of education in society
Kato: A variety of problems and issues have been pointed out regarding career choices in Japan. What is your view?
Fukuhara: I get a sense of crisis from the fact that in Japan today, a sharp distinction is drawn between scopes of study from a young age.
Kato: You’re referring to the way “arts” and “sciences” are separated, aren’t you? That’s another characteristic of Japanese education.
Fukuhara: That’s right. I think that combining arts and sciences is very important. I have been a homestay host to many American university students, and since American universities don’t require students to choose their major when they enroll, you have students who wanted to be corporate consultants when they started and went on to medical school aiming to become doctors after graduation, and I have seen the opposite happen. In the course of going through four years studying at university and meeting people, they get to discover the path they want to take.
In Japan, though, students actually have to choose their path before they turn 18. Parents and school teachers exert such a great influence on them and the world they see for themselves is so narrow that I think it is unfair to make them make life choices then. Junior high schools and high schools are often confined to communities that consist of only teachers and students, and students end up only being able to live the lives that their teachers and parents acknowledge for them. Instead of this situation, once young people get together at universities, we should give them opportunities to come into contact with many adults and expand their perspectives beyond school into society, regardless of groupings such as “science” or “humanities.” On top of that, we need to provide opportunities for them to choose what they really want to do. Under Japan’s system right now, so many career paths are closed off to students from the moment they go to college, and this I believe results in a loss for both society and individual happiness.
In this sense, oya-gacha [or “parent-capsule prize,” a term meaning that kids can’t choose their parents, just like the random prizes that come out of capsule vending machines], which was nominated for the 2021 Words of the Year, while a terrible word in itself, reflects the reality that parents have a strong influence on the career paths of their children. A major task in getting rid of the oya-gacha mentality will be considering how to change the entire public education system, from elementary school to university.
Kato: To add to that, I think it’s time we stopped depending on Western educational models in our vision of what the next generation’s education should look like. Shouldn’t we think about this and go ahead with the rebuilding process ourselves?
Fukuhara: Yes, indeed. We have teachers in Japan who are reforming education in their own ways, but we need parents to change as well, and it’s also crucial to raise awareness of education in our society as a whole. In the current situation, it’s very hard for the politicians who formulate education policy to win elections. We shouldn’t only be interested in education when we have kids who go to school. If we don’t think about educational issues in society, in localities, and in our country as a whole, we won’t be able to create a wealthy community.
Education is all we need to break down the divisions in Japanese society
Kato: This means that we have to raise awareness of education as the foundation of society itself, and consider it as our own business, while taking a longer-term view. In connection with this, IGS provides technology-based education and assessment services for a wide range of age groups, from schools to corporations. What kind of future does IGS hope to realize?
Fukuhara: IGS’ goal is to eliminate the various divisions in society, and we believe that the prescription for our currently divided Japanese society is education. However, education is designed along with the way it itself is evaluated. In other words, if the evaluation doesn’t change before the education does, then society won’t change either. Unless Japanese society changes its evaluation axis, which has the University of Tokyo and national exams at the top, education from kindergarten to university will continue to focus on finding the optimal solution to a question that already has an answer. ISG is committed to “evaluation and education,” in that order, rather than “education and evaluation.”
Although we sometimes get general criticism that says, “education without evaluation is the ideal,” we believe that an important element of education is to go about setting up accurate evaluation axes that consider each individual’s diversity as an important element of education. We want to build an evaluation and education system that utilizes technology as a means to realize a sustainable society that has no divisions. That is IGS’ purpose and vision.
Kato: That we need to reform education itself, which aims at standard uniform goals like “following the path to university,” and education that evaluates students based mainly on exam scores, makes a ton of sense to me. This isn’t limited to school education either, right? The personnel evaluation axes and standards for promotion at major companies we’ve had since the age of lifetime employment are also undergoing serious reevaluation. It is no longer fine just to have everyone rowing the boat in the same direction, and I think that the coming age will require new evaluation methods that more clearly visualize individual abilities and make the right investments in people.
Getting the right evaluations from society is important for self-actualization
Fukuhara: Actually, when I was at INSEAD (European School of Management), I received 360-degree feedback from classmates from around the world who were on my project team, and it was quite an eye-opener. Many of these evaluations were totally unexpected, and at the same time, I realized a basic fact: if I can’t get recognition from the other people in the current environment I’m in, then they won’t listen to my opinions. At the same time, I realized that the evaluation of one’s abilities can change greatly depending on the project at that time, relationships with others on the team, and current trends. To put it another way, my outlook opened up to the fact that there is no absolute right answer for one’s own ability, and that ability isn’t decided until the end, that is to say, people change.
This experience led to the development of GROW, IGS’ unique 360-degree assessment tool, because we believe that a new mechanism for getting evaluations from people around you is important for personal growth. Our 360-degree assessment enables the visualization of 25 competencies that are common to human resources who can be successful in this era of rapid change. Its advantage is the use of AI (artificial intelligence) to compensate for each evaluator’s subconscious evaluation habits, or bias, thereby increasing assessment reliability. We also use the Implicit Association Test, a global standard for measuring cognitive bias, to measure individual personality traits of which even the evaluators themselves are unaware.
Many companies have implemented our 360-degree assessment system, GROW360, and are using it for employee recruitment and growth. I’ve also heard that employees learn a lot from the experience of evaluating their team members. For students, we offer a similar system, Ai GROW, which has been introduced in more than 200 elementary, junior high, and high schools. Even in Japan, where academic achievement is overemphasized, we can see a movement toward measuring and cultivating the abilities that students will need in society.
Kato: I see. I think learning an accurate assessment system and experiencing evaluations are effective for employee development as well. A company’s growth is the growth of the people who work there, and one could expect that introducing accurate evaluations will be key to strengthening the organization.
Self-affirmation is an indispensable factor for a happy life
Kato: By the way, these days we often come across the terms “self-affirmation” and “psychological safety” in newspapers, magazines, and in business circles. How do you see these, as someone who has been dealing with assessment and education?
Fukuhara: Self-affirmation and psychological safety can also be measured as latencies with the Ai GROW function. Many schools have introduced it, and it is becoming an important indicator in both business and education.
First, with self-affirmation, it is important for you to obtain accurate evaluations from others and take a good look at yourself, as in the 360-degree assessment I mentioned earlier. However, as a basic premise, one can’t live happily unless one can affirm oneself as oneself. No matter how society may temporarily evaluate you, maintaining the sensitivity that “this is what I like and this is what makes me happy” is crucial to happiness. I believe that giving children baseless confidence in their early years is also an important parental role that will help them maintain self-esteem within society and discover their own path to happiness.
In a 360-degree assessment, receiving a low evaluation from others while having high self-evaluation is not a bad thing. It may be that the competencies that you perceive are not being expressed, or just that you aren’t in the right place to start out with. So, it becomes an opportunity to look for a new place where your abilities can better contribute to society. Of course, since a self-assessment could be clearly wrong, meta-cognition for objective self-awareness is also important, but the key is to have a balance between the two. Getting back to the matter at hand, what is more important than evaluations by others is a high level of self-affirmation, that is, to have a mind that naturally feels that one’s mere existence in this world itself has meaning. Only when you have respect for your own existence can you respect others.
Next, psychological safety is a topic for organizations. It’s said that an organization where everyone can speak freely and take part in constructive discussions has psychological safety. I must point out here that we should not confuse psychological safety with conformity or consistency. For example, you might see an unusually strong conformity or consistency in a school or company where the constituent members share similar attributes. On the contrary, this type of situation does not guarantee psychological safety. As I understand it, psychological safety exists when you can firmly express your own opinions within an organization, and can always have a constructive discussion without being criticized in an irrational way.
Kato: I see. You’ve made it very clear. WealthPark wants to build a world where living life with investments is the norm, whether it’s yourself, financial products, or real estate. Think of investment beyond the narrow sense of money, as with financial products and real estate, in a broader way that includes investing in human capital and making contributions to society through it. We believe that a life with investment is the starting point of social growth and wealth, as well as an important factor letting individuals be themselves while living their lives.
What I particularly learned from our conversation today is the concept of placing value on yourself. Self-affirmation and accepting accurate evaluations from others will lead you to invest in yourself for the future. And this will further lead you to contribute to the people around you and to society. Although our fields of business are different, I would love for IGS and WealthPark to work together to contribute to a new culture where investment is a lifelong friend. Thank you very much for a very meaningful discussion today.
