Japanese climate capitalism? Toward an understanding of industry’s changing attitudes toward climate change mitigation in Japan

Abstract

Despite a history of progressive environmental policies in relation to pollution and energy efficiency, Japan stands out as a country with relatively few achievements on the issue of climate change. While research on Japanese climate change policy up until now has focused attention on the role played by government, to date insufficient attention has been paid to the role and impacts of various sectors of Japanese industry in both directly influencing climate change policy and in shaping the discourse surrounding climate change in Japan, as well as to the ways through which the accumulation strategies of different fractions of capital may be impacted by climate change policy. This article overcomes this gap by surveying business responses to climate change and climate change policy through a mixed methods approach that combines content analysis and critical discourse analysis of major firms’ annual corporate reports, comparing data from 2010, the last year prior to the 2011 Great East Japan Earthquake that had highly disruptive impacts on Japan’s power generation capacity as well as the discourse surrounding energy more widely, and 2022, the most recent year for which all firms had data available. The content analysis results indicate a substantial increase in attention to climate change related keywords between 2010 and 2022 across all sectors, but particularly for the oil and gas, electric power, and steel manufacturing sectors. Yet a closer look at some of the detailed comments from key firms indicated an ongoing commitment to continued expansion of output and consumption, with carbon neutrality to be achieved wholly through the application of advanced technologies, many of which are currently commercially or technically unviable, raising questions about many firms’ abilities to effectively achieve their emissions reductions targets without more significant changes to their overall business strategies.

Keywords:

• Climate change
• carbon neutral
• corporate social responsibility
• climate capitalism
• Japan

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1 The GX Promotion Act was notable for its renewed commitment to nuclear power, including by securing 20-22% of Japan’s energy from nuclear power in 2030, as well as in its promotion of carbon capture and storage combined with hydrogen and ammonia co-firing, technologies that are as-yet commercially unviable, with less support for already existing renewable energy technologies (Ohta and Barrett 2023). While the Act also contains provisions for an emissions trading system headed by METI, the voluntary nature of the system leaves reason to be skeptical of its capacity to induce bold action from firms (see also Ohta and Barrett 2023).

2 Japan has nine regional power companies that each had total monopoly control over electricity distribution within their region prior to deregulation in 2016: HEPCO serving Hokkaido; Tohokuden serving Tohoku region and Niigata prefecture; TEPCO serving Kanto region; Chûden serving parts of Chûbu region; Hokuden serving most of the Hokuriku region; KEPCO serving Kansai region; Yonden serving Shikoku region; CEPCO serving Chûgoku region; Kyûden serving Kyushu region; and Okiden serving Okinawa prefecture.

3 The lone exception to this is Ozawa and Hachinohe (2021), which examined keywords used in data from the JBF Challenge Zero website summarizing the projects of firms belonging to the JBF’s Challenge Zero initiative. However, while Ozawa and Hachinohe (2021) study demonstrated sectoral differences in attention to key technical issues (electrification, finance, energy decarbonization) among the projects surveyed, it did not aim to interrogate the overall discursive framing of climate change among major firm’s general reports on business activities, nor did it seek to compare changes in the degree of attention paid to climate change in comparison to the period prior to the 2011 East Japan Great Earthquake or provide data at the level of individual companies.

4 While Panasonic and Sharp were the third and ninth largest electronics firms by sales in Japan respectively in 2023, they were the only major firms among major electronics firms to produce more than 100 MW of power from rooftop solar, ranking 6^th and 3^rd among all companies, the rest of which were primarily smaller firms focused on solar panels and not representative of the electronics sector overall (Nikkei 2024; Smart House 2024, quoted in Nobunoburogu 2024). Their competitive position in the solar panel industry is not new: Panasonic and Sharp ranked first and second in respectively in residential solar capacity in 2014 (Solar Partners 2024).

5 Nippon Steel, previously Nippon Steel & Sumitomo Metal, was created out of the merger of Nippon Steel and Sumitomo Metals in 2012. For data from 2010, Sumitomo Metal’s Annual Report was consulted.

6 Though less of a pioneer of hybrid and EV technology than Toyota and Nissan, Mazda’s progress to date in hybrid and EV technology may be seen as better representative of Japan’s other car makers, including Suzuki, Subaru, Honda and Mitsubishi, and was selected partly for this reason.

7 While Annual Reports are publicly available and easily accessible, generally these reports do not receive specific attention in the mainstream media. Thus, it is less the general public than people with a specific interest in the business activities of these firms, including activists, researchers and policymakers.

8 Indeed, for many firms, significantly more attention was paid to the still ongoing 2010 Global Financial Crisis.