#Japan #Tokyo #Employee Engagement #Human Capital #Management Philosophy

Understanding the Impact of Management Philosophy on Employee Engagement

In February 2023, the Japan Productivity Center (JPC), based in Chiyoda, Tokyo, disclosed a significant survey titled "Research on the Recognition of Human Capital Management in Listed Companies (Preliminary Version)". This survey underscores the importance of human capital management, which views human resources as vital capital and aims to maximize their value. The JPC established a working group dedicated to measuring and disclosing human capital management metrics in April 2023, following the obligation to report such information in financial statements starting in March 2023.

This investigation primarily focuses on employees' perceptions of their companies’ human capital management and the subsequent impact on work engagement and psychological safety. Conducted from October 21 to 24, 2025, the survey involved 1,097 employees aged 25 to 64 from domestic listed companies, utilizing internet-based methods to gather data. All research was supervised by esteemed professors Yasuhiro Ichimura and Hiromi Asano from the Graduate School of Business Innovation.

Key Findings

Here are some of the notable features derived from the survey:

1. Employee Understanding of Company Philosophy

Only about 40% of employees feel they can articulate their company’s management philosophy. While a majority (54.3%) indicated they understand the content of the philosophy and behavioral guidelines, fewer than 40% felt they could explain it to newcomers or external parties. Interestingly, the understanding of management philosophy appeared more pronounced in older employees, specifically those aged 55 to 64, with no significant differences observed across other age groups. Sector-wise, the electrical and gas industries, along with construction, reported better understanding compared to the transportation industry, which lagged behind.

2. Awareness of Human Capital Management Measures

There was noticeable variation in employee awareness regarding mass and individual human capital management measures. For instance, around 40% of employees provided positive feedback on mass initiatives, like top management's messages and the integration of HR strategies with business objectives. However, a considerable percentage remained neutral or negative. Individual measures, such as opportunities for skill development and managerial support, exhibited a broader range of positive responses, reflecting different perspectives depending on the specific initiatives.

3. Link Between Management Philosophy and Engagement

The study illustrated a clear correlation between the understanding of management philosophy and several positive workplace attributes, including work engagement and psychological safety. Those who recognized their company’s management philosophy reported an engagement level significantly higher than those who did not, indicating that shared values likely influence the workplace environment and employee satisfaction. This relationship hints that fostering a better understanding of company philosophy could enhance overall productivity and employee morale, particularly in organizations heavily reliant on human capital.

The full report detailing these findings is available on the Japan Productivity Center's research site, showcasing critical insights into the relationship between management philosophy and employee dynamics. The anticipated report in March 2026 will provide more in-depth analyses of human capital metrics as mandated in financial disclosures.

For more information, please visit: Japan Productivity Center Research Site