"Earth's resources hold dreams."

This series follows Dentsu Inc.'s 'Company Design' team as they uncover the secrets behind vibrant companies possessing 'originality.' In the 15th installment, we delve into Nippon Environmental Design, a company that continually challenges itself to transform society by redefining the very concept of recycling. We explore its unique and unwavering management philosophy.

Even focusing just on clothing and textile scraps, 92 million tons are generated globally each year, and approximately 1.47 million tons annually in Japan alone. Much of this ends up incinerated or landfilled. The sheer scale makes it hard to grasp the volume. While we might think "What a waste," there's also a sense of resignation—after all, it's just trash, right?

The word and spirit of recycling have permeated society to some extent. Yet, many people, myself included, use the act of recycling as a form of "atonement" for discarding things, or perhaps as a "pretense" of giving waste a second life. It's a feeling of "I feel kinda bad about it." Like, "At least I'll recycle it to make up for it." It's definitely not a positive feeling.

Chairman Iwamoto of Japan Environmental Design refers to everything recyclable in this world, including trash, as "earth resources." It's a fresh perspective. It's not about atoning for sins by digging up resources from underground. It's an extremely positive idea: the resources are right here in front of us, so let's use them. This mindset is also giving birth to entirely new businesses. I want to learn the essence of creativity and business from Japan Environmental Design.

Written by: Shunsuke Amanouchi (Dentsu East Japan Inc.)

Nippon Environmental Design. With the theme "Circulating Everything," they have launched the BRING brand.

The trigger was the DeLorean

"The catalyst for starting this business was the DeLorean from that famous Hollywood movie." At the start of the interview, Chairman Iwamoto began with an intriguing remark. "The fuel for the time machine is trash lying around. Isn't that exciting?" I'd never watched that movie focusing on that aspect. But now that he mentioned it, it was indeed a memorable scene. While terms like sustainability have suddenly started being shouted about in recent years, I realized the hint was already depicted in that DeLorean scene.

"Our company's ideal is recycling that everyone can participate in. The focus isn't on corporations, but on consumers. We desperately think about how to make people feel, 'Ah, I want to participate too.' We create systems. We use every means to promote it. I think that's what's important. We launched the BRING brand with that same spirit."

According to Chairman Iwamoto, things that burn are seen as "objects." But we should see them as "resources." "To do that, it's crucial to see what's right in front of us at the elemental level. As long as you see it as a worn-out object, it's just trash, right? But at the elemental level, it's a precious resource."

Michihiko Iwamoto:
Chairman and Executive Officer, Nippon Environmental Design. Born in Kagoshima Prefecture in 1964. After graduating from Kitakyushu City University, he joined a textile trading company. While working as a salesman in 1995, the enactment of the Container and Packaging Recycling Law led him to become deeply involved in textile recycling. He established Japan Environmental Design in January 2007. Aiming to create a society where resources circulate, he works not only on recycling technology development but also on standardizing recycling practices in collaboration with companies across multiple industries, including manufacturers and retailers. Selected as an Ashoka Fellow in 2015.

"Why do you think wars and terrorism happen? One cause is the scramble for underground resources. Coal, oil, and next, they say, water. You often hear talk about reducing carbon dioxide, right? Essentially, it's about how we utilize resources. As long as we perceive what's right in front of us as trash, we inevitably have to burn it. But what if we started thinking of them as resources we could use semi-permanently? We wouldn't need to ship raw materials all the way from distant countries by tanker. Oil resources are literally lying around right in front of us. They can become clothing, or transform into eyeglasses. If everyone recognized the value of these 'earth resources,' I believe it would definitely have positive effects on the economy, the environment, and peace."

Right is fun. Fun is right.

President Iwamoto says he wants to create a "Ground Resource Economy." The conversation that started with the DeLorean has somehow grown larger. "If you have a tree one meter tall, its roots are about ten times that length, right? They can grow to unbelievable depths. If recycling just makes a one-meter tree and that's it, then it's meaningless. I want to design an environment that deeply roots itself in society and makes everyone happy."

According to Chairman Iwamoto, "What's right is what's fun for everyone." And precisely because it's fun, everyone can keep doing what's right. When people hear "eco" or "recycle," they inevitably get stuck on images of restrictions and sacrifice. "Instead, it's about turning zero into one. Making the unbelievable, the 'No way!' things, actually happen. Don't you think it would be amazing if we could do something unprecedented with vegetable scraps and plastic bottles from the trash bin? In other words, what's right is enjoyable, and the key to what's right lies in what's enjoyable." The conversation returned to the DeLorean.

This is the legendary DeLorean. Just its form alone is incredibly exciting.

Management is about "deciding" the "direction"

Chairman Iwamoto says management is about deciding the path forward. "New recycling laws were enacted in 1995. Now it's 2021. Awareness about recycling is gradually permeating society. Changing people's attitudes and actions takes 20 or 30 years. Waving flags in a hurry won't sway people's feelings. Restricting them with regulations just makes things stifling—it never brings happiness."

Chairman Iwamoto states that relying solely on physical measures won't move things forward. Physical measures refer to things like establishing laws or setting up distribution systems. "Recycling should be approached chemically, with a long-term perspective." In other words, people are captivated by things like, "That PET bottle turned into such a fluffy sweater?"

"Our company started with just 1 million yen in funding. When we considered how to use this million, we focused on chemistry." With billions in capital, one might be tempted by money games. But to use that precious million effectively, we wanted to invest it in something "chemically meaningful." Pardon the corny pun, but it's about transforming that money into something meaningful for society.

Commemorative photo from the founding

Recycling is not charity

Chairman Iwamoto emphasizes that the key is making recycling profitable. "This applies both to the company and to our customers—the consumers." In other words, it's about turning customers' desire and willingness to recycle into a viable business model.

"In so-called brand theory, common phrases like 'Japan's best' or 'world's best' come to mind, right? But those are just results-oriented claims. What truly moves people's hearts are things like music or movies that strike a chord. The thrill of realizing, 'Oh, this PET bottle is reborn into such a product!' can't be conveyed by logic alone. It's when you think, 'No way, this feels amazing!' that you truly feel, 'Recycling is wonderful.' Then you start thinking, 'Why not spend money on this?' or 'What can I do to reuse this PET bottle I just saw as trash?' That feeling drives action."

In fact, Chairman Iwamoto says the approach from younger generations is growing year by year. "In a word, I think it's because it's fun. There's polyester that feels almost like cotton. And unlike cotton, it doesn't lose its shape easily or fade. That feeling of 'Oh, this is great, this is fun.' If that's gradually spreading through society, nothing could make me happier. It's hard to put into words, but we want to create something like an 'indescribably comfortable market.'"

The Crucial Element: "Process Design"

Chairman Iwamoto states that the three elements of "manufacturing, sales, and recycling" must all be present. Unless these three elements continuously cycle, it cannot be called a business model. "For that, it's crucial to consider recycling right from the manufacturing stage. Simply making things, selling them, and then recycling them as if to atone for sins won't last."

Chairman Iwamoto also introduced the unfamiliar term "historical value." "It's my idea, but I often use expressions like '10/50.' That means recycling the same resource for the 10th time, reusing something from 50 years ago. We also started using the term 'earth resources.' It's a bit self-serving, but it's easy to understand, right? And being easy to understand means it's easier to gain consensus."

At the end of the interview, Chairman Iwamoto offered some very clear advice: "What's crucial for business isn't the final numbers. It's designing the process. Design the process with a 20- or 30-year view, and involve many people in that process. Make everyone, make society, happy. Sales and results are just outcomes that follow later."

We began the interview asking, "As an advertising agency, is there anything we can do to help your business?" Yet he ended up explaining the entirety of advertising business and creative know-how, leaving us utterly impressed.

Japan Environmental Design's showroom is here:
Videos about recycling are here:

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Season 2 of the Dentsu Inc. 'Company Design' team's series exploring the secrets of 'vibrant companies' with 'originality.' Episode 15 introduced Nippon Environmental Design, which relentlessly pursues challenges to bring change and innovation to society through recycling.

Season 1 of the series is here.
The "Company Design" project site is here.

[Editor's Note]

At the very end of the interview, I had one final question I simply had to ask Chairman Iwamoto: "Recent years have seen growing attention to the fact that Edo-period Japan was an incredibly advanced eco-society. But it was a feudal society. How could such an eco-system be established under such rigid conditions?" Chairman Iwamoto's answer was unexpected: "Efficiency is actually inefficient."

It was a Zen-like answer, but upon hearing his explanation, I was deeply impressed. "People, whether in politics or business, inevitably pursue efficiency. Simply put, it's the mindset of 'let's boost the numbers.' When you want to boost numbers, what do you do? You stop investing in anything wasteful. You just keep digging up oil, coal, gold—whatever it is—and consume it relentlessly, forcing consumption. What do you think is missing here? It's the chemical mindset. I believe what's needed for future value creation is a scientific, or rather, a chemical perspective."

I never imagined the word "chemical" would come up in a discussion about the Edo period. The eco-society Chairman Iwamoto aims for isn't one bound by rules or morality. It's about giving value to what lies right before us. And the means to give that value isn't some money game. It's fundamentally grounded in chemical reasoning and technology.