"The Importance of DEI in Advertising Agencies." Advertising Week Asia 2023 Report

Achieving gender equality in decision-making roles remains a major challenge, with companies setting targets for the proportion of women in management and executive positions.

In April, the Gender Equality Council under the Cabinet Office announced a target of achieving at least 30% female representation among executives at Prime Market-listed companies by 2030. However, Japan's latest Gender Gap Index ranking, released recently, dropped to 125th place compared to last year. This suggests the challenges are not being resolved but are, in fact, growing.

What significance do DEI initiatives and efforts to achieve gender equality in decision-making layers hold for advertising agencies? We present a session held at Advertising Week Asia 2023*. Based on the results of the "DE&I Questionnaire Survey" conducted by the Japan Advertising Agents Association (JAAA) DE&I Committee, three individuals actively promoting DEI engaged in discussion.

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From left: Professor Shouei Iriyama, Waseda University Graduate School; Yuko Kitakaze, Chief Sustainability Officer, dentsu Japan; Shizuka Nakajima, Head of Sustainability Promotion Office, Hakuhodo DY Holdings

Diversity is the Source of Innovation

Nakajima: First, our initial theme. We'd like to ask why the proportion of female managers doesn't exceed 30% and how we can increase it.

According to a JAAA survey, the current average ratio of female managers in Japan's advertising industry is 13.2%. This is a very low level even globally. All companies are implementing measures to raise this ratio to 30% by 2030.

Iriyama: Why can't we exceed 30%? I believe the biggest challenge is that "exceeding 30% has become the goal itself." I sense a prevailing attitude where companies are pushing forward with initiatives thinking, "We have to do it because it's mandatory," without truly understanding "why diversity is necessary." In fact, when I once asked someone from a company's DEI promotion office, "Why do you want to pursue diversity in the first place?" they replied, "I don't know." I believe this is a root cause of why the number of female managers isn't increasing.

Why is diversity necessary? There can be various reasons, but from a business management perspective, one major reason is to drive innovation. Companies that fail to innovate have no future. As Schumpeter proposed 90 years ago, innovation arises from the combination of disparate knowledge. Knowledge resides in people. It's obvious that having people with diverse knowledge within the same organization makes it stronger. That's precisely why diversity is essential for organizations.

Kitakaze: I agree completely. For me, the reason diversity is necessary is simple: "We can't win unless everyone contributes." I believe everyone, to do good work, wants to team up with people who have different opinions from their own, or who can do things they themselves cannot. If you don't do that, good ideas won't emerge. If you recall that experience, understanding why diversity is necessary should be easier, right?

That's why I say it's not about "women's advancement," but about "everyone's advancement." What's important is creating an organization where everyone thrives, and women are included within that.

Creating an environment where people can "Be You" is essential

Iriyama: Male-dominated companies also carry higher compliance risks, right? In Japan, small and medium-sized enterprises (SMEs) actually experiencing labor shortages sometimes lead large corporations in DEI initiatives.

Kitakaze: As companies grow larger, they become afraid to change. They lose confidence, thinking, "Something has to change." But the problem lies with the company if you can't be yourself. It's crucial that you can leverage your strengths and "Be You." Creating that kind of environment is also part of my job.

Iriyama: Exactly. Diversity only truly works when it's accompanied by "inclusion." Simply gathering diverse people isn't enough; companies grow stronger by combining disparate knowledge. Therefore, creating an environment where these individuals can freely express their opinions as "Be You" is incredibly important. That's what we call psychological safety.

What happens when diversity takes root? Actually, meetings become more contentious. Japan currently has a culture of seeking unanimous agreement. That stifles innovation. The key, after advancing diversity, is creating an environment where diverse opinions are drawn out. This requires managers to develop strong facilitation skills.

All too often, a 90-minute meeting becomes the department head talking the entire time. That defeats the purpose, doesn't it? When managers occupy a central position issuing instructions to surrounding employees in a radial relationship, lateral connections among employees deteriorate, and psychological safety breaks down. As seen on certain variety shows, when discussion centers around panelists rather than the host, natural horizontal collaboration emerges, fostering "Be You" opinions. Diversity training for managers is crucial to creating such environments.

Kitakaze: Japan's diversity efforts also critically lack "equity," don't they? When we try to increase female managers, we're told, "Women don't want to be managers in the first place." That's only natural. No one will aspire to a role without role models, confidence, or empowerment.

Iriyama: One reason equity is lacking is that men tend to have little experience as minorities. My personal suggestion is for men with children to attend their school's parent-teacher association meetings. When I actually participated, nearly all attendees were women. Speaking up in that situation took tremendous courage! It really drove home the importance of psychological safety.

Another factor is the lack of spaces for mutual understanding. For example, at Unicharm, they hold menstrual health training sessions open to both men and women. By learning about and discussing menstruation in a psychologically safe environment, not only women's concerns but also men's concerns are naturally brought up, fostering mutual understanding. Creating such spaces for mutual understanding is also a form of equity.

Nakajima: Regarding women's advancement initiatives, men might feel blamed and become withdrawn. DE&I promotion should inherently be positive, which is precisely why actively providing feedback on good initiatives is also necessary.

Creating systems that change actions, not just awareness

Nakajima: What can we do and what should we change to build a diverse society where everyone can thrive?

Kitakaze: Changing people's mindsets is incredibly difficult and even presumptuous. That's why I think it's crucial to create "systems that change behavior," like 1on1 meetings. Creating such systems is something advertising agencies excel at, isn't it?

Iriyama: I wholeheartedly agree. You can't change people. But you can create opportunities for them to change themselves. Advertising agencies are positioned right at the center, connecting companies and society. If the center changes, society as a whole will change too. I believe that's the role advertising agencies should play.
I hope they can become an organization that provides opportunities for society as a whole to engage, including on diversity.