Crisis, rigidity and nonliberal governance in Japan: the cases of Mitsubishi Motors and Kanebo

Abstract

Purpose

The authors examine the nature of institutional rigidity and governance problems contributing to crisis and under-performance of large corporations in Japan during a period of environmental turbulence for corporate Japan.

Design/methodology/approach

Through explorative case studies of Mitsubishi Motors and Kanebo over a 10-year period from the mid-1990s to the mid-2000s the authors see how informal norms deeply embedded in the Japanese business system prevented the adoption of more liberal forms of governance that may have helped to overcome crisis.

Findings

Despite fundamental differences in formal organization between the two cases, there were similar underlying problems in terms of (1) mechanisms for capital investment that would underpin strategic resilience and rejuvenation and (2) management decision-making and strategic control during crisis.

Research limitations/implications

The cases show how normative institutions rather than formal regulative institutions matter to strategic continuity in national business systems that are put under pressure.

Originality/value

The authors link informal norms of governance intrinsic to a country to the issues of strategic resilience and responses during crisis and warn against the retrenching to traditional governance approaches where there has been criticism of alternative governance approaches.

Citation

Takeshita, S., Lee, S.H., Williams, C. and You, J.J. (2021), "Crisis, rigidity and nonliberal governance in Japan: the cases of Mitsubishi Motors and Kanebo", Continuity & Resilience Review, Vol. 3 No. 3, pp. 209-231. https://doi.org/10.1108/CRR-10-2020-0032