Continued from Part 3: The father of Japan’s capitalist economy is Shibusawa Eiichi (涩泽荣一) (1840- 1931), a highly respected Japanese industrialist. Guided by his study of Confucius’ Analects, Shibusawa brought Western capitalism to Japan, but with a core emphasis on morality and business ethics.
The purpose of self-cultivation is not for oneself, but for the cities and villages–to contribute to society’s prosperity and the success of the country.
Shibusawa Eiichi
Today, Japanese brands are synonymous with quality, integrity and value, producing reliable products that meet or even surpass global standards. In addition, Japanese corporations and businessmen typically engage in corporate philanthropy, due to the widespread cultural belief that giving back to society is their honourable duty.
How did modern Japan develop this widespread culture of good business ethics? This is largely due to the efforts of Shibusawa. A practicing Confucianist, Shibusawa worked hard to integrate Confucian values into Japan’s business and commercial sector, sharing his knowledge and ethics with Japanese businessmen and investors.
Shibusawa was a strong believer in putting one’s understandings of Confucian teachings into practice. Today, we’ll look at two Confucian values that Shibusawa helped integrate into Japan’s economy: putting “society above self” and “overflowing in love to all”.
Giving Back to Society: The True Purpose of Earning Money
While Shibusawa believed that the goal of businesses is to generate profit, this motive should not be selfish, but to benefit others.
Businesses must be profitable–if your business is losing money, then you as a business owner have failed. But your motive for making money is a completely separate issue–are you doing it for yourself, or to benefit the people and the country? This mindset can make all the difference.
If a business owner’s motivations are self-serving–such as to make themselves lots of money without regard for others’ wellbeing–this goes against the Confucian ideal of a virtuous person. It goes against the Confucian spirit of working for the greater good–to improve the country and its people’s lives.
Such a businessman will lose respect. Even if he becomes wealthy, he will be viewed as unscrupulous, immoral, and self-centred.
Even if one is making money to benefit others, one should do so through ethical means. The process one takes should be a moral one. Only in this way will he be respected as a great businessman with a noble career.
Throughout his life, Shibusawa encouraged younger generations of businessmen to give back to society. In his book The Analects and the Abacus, under the chapter “Self-Cultivation is Not a Theory, Shibusawa said, “The purpose of self-cultivation is not for oneself, but for the cities and villages–to contribute to society’s prosperity and the success of the country.”
On another occasion, a rich businessman’s son who had recently graduated came to seek Shibusawa’s advice. Shibusawa cautioned that the graduate’s father would not like what he was about to say, but he was still going to speak his mind:
“A business owner’s wealth is derived from society and the people who patronise the business. As such, businessmen should actively engage in philanthropy and public work. In this way, society can grow healthily and everyone benefits. Giving back to society forms a positive cycle that ultimately comes back to benefit oneself, ensuring that one’s cash flow is stable and continuous.
“On the other hand, if the wealthy do not care about society, if they think they can still reap profits from the people while segregating themselves and disregarding public welfare, they will incur the people’s wrath. They will lose public support and that is an even greater loss.
Giving back to society forms a positive cycle that ultimately comes back to benefit oneself, ensuring that one’s cash flow is stable and continuous.
Shibusawa Eiichi
“If you manage a business with a selfish mindset, you will benefit neither the people nor yourself. Therefore, in your pursuit of profit, never forget to give back to society and exercise your public duty.”
‘Overflowing in Love to All’
Even in his later years, Shibusawa continued to work tirelessly for Japan’s society and economy. This was particularly prominent in his nondiscriminatory attitude toward the many who sought his help and advice.
In the Abacus, Shibusawa said, “No matter who comes to visit, I will personally meet and talk with them. The world is so big, and there are so many able and wise people. Even if some of these visitors are dishonest at heart, if I turn them away before understanding their situation, I would not be acting virtuously. This, I believe, is my responsibility.
“Therefore, I don’t set any restrictions on visitors and treat them all with respect and courtesy. If a visitor makes an unreasonable request, I explicitly reject it. But if the request is reasonable and meaningful, I will do my best to help.”
Shibusawa added that some people, particularly the wealthy and influential, dislike and turn away visitors. However, by doing so, they have failed to exercise their duty to society.
(Source: Wikipedia)
Through his broad-minded attitude, Shibusawa demonstrated the Confucian ideal of “overflowing in love to all”–as long as it was ethical, he was willing to help others without discrimination.
Throughout his career, Shibusawa helped found hundreds of Japanese corporations and spearhead economic reforms. Despite that, he sought to gain as little as possible. He refused to maintain a controlling stake in the companies he founded, thereby preventing himself from having any sort of monopoly.
Again, his considerations were for the country and people before himself.
He said, “When I am in management, I always keep in mind that my job is to fulfil the people’s needs. Therefore, I must manage things ethically and morally.
“Even if the business itself appears small and inconsequential, and I personally don’t benefit much from it, as long as it is something that society and the country needs, I work tirelessly and happily at it. I view Confucius’ Analects as the bible of all businessmen, and I strive not to deviate from Confucius’ teachings of the righteous way.”
Through his work, Shibusawa also proved that not only was his form of management profitable, it earned him the utmost respect of the Japanese people. In recognition of his enormous contributions to Japan’s economy and society, he was conferred the title of 1st Viscount.
When I am in management, I always keep in mind that my job is to fulfil the people’s needs. Therefore, I must manage things ethically and morally.
Shibusawa Eiichi
He was also awarded Shōnii, Second Honour under the ritsuryō rank system, which is typically reserved for high-ranking nobility and prime ministers. This was an exceptional honour for a man who started out as a humble farmer.
At the time, Shibusawa’s contributions could be found in every economic sector of Japan. He started and served as president of Japan’s first modern bank, Dai-Ichi Kangyo Bank (First National Bank). After that, Shibusawa founded enterprises in finance, shipbuilding, transportation, textiles, materials, and postage services, among others. A strong advocate of education, he also founded business schools, social welfare agencies and so on.
I view Confucius’ Analects as the bible for all businessmen, and I strive not to deviate from Confucius’ teachings of the righteous way.
Shibusawa Eiichi
Much of Japan’s economy and infrastructure today was established under his guidance. New or seasoned entrepreneurs would seek him out for counsel and aid in setting up a business. He was trusted to an almost implausible degree, but this was only possible because of his success, morality and selflessness.
Those who followed Shibusawa’s advice frequently succeeded in their enterprises, while those who did not often met with failure.
While Shibusawa’s achievements appear miraculous, they are actually the result of his conviction to manage and establish enterprises according to Confucian virtues. His life example is proof that one can achieve success by putting Confucian virtues into practice, even in business.
