1. Blueprint for Japan 2020 Joichi Ito (Neoteny) Oki Matsumoto (Monex) Blueprint for Japan 2020

2. Blueprint For Japan 2020 Condition of Diversity (1) 0 10 20 30 40 50 60 70 JAPAN GERMANY FRANCE ITALY UK CANADA USA (%) 0 20 40 60 80 100 JAPAN UK USA FRANCE GERMANY CANADA ITALY PERCENTAGE Feb 1999July 2000 Entrepreneurship is not socially accepted ※ The graph on the left Percentage “yes” on item: People you know respect those starting a new business Japanese Afraid to Start Companies ※ The graph on the right Percentage “yes” on item: Fear of failure would prevent you from starting business

3. Blueprint For Japan 2020 Condition of Diversity (2) 32 % 4% Ruling Party ※ The circle inside is all University Graduates. The circle outside is all Presidents of Japanese listed Companies Japanese society have a bias for Academic Background. The name-brand university graduates that occupy 4% in all university graduates occupy 32% in all presidents of Japanese listed companies

4. Blueprint For Japan 2020 Condition of Democracy (1) “Me too” contents of Japanese newspapers Journalists are shut out by violation 70% of date source of Japanese major newspaper are from Press Clubs Abandonment of Agenda Setting Adhesion between government and journalists Circulation of Newspapers Bad Influence of Press Clubs

5. Blueprint For Japan 2020 Condition of Democracy (2) UnsuccessfulSuccessful 0 20000 40000 60000 80000 100000 120000 140000 Rate to the smallest number 0% 50% 100% 150% 200% 250% 300% Shimane 3 Kochi 3 Shimane 2 Tokyo 22 Kanagawa 7 14 Those who got less poll than the unsuccessfuls were elected. A vote in some districts have double value to one in other districts.

6. Blueprint For Japan 2020 Condition of Democracy (3) 25 35 45 55 65 75 20 ～ 24 25 ～ 29 30 ～ 34 35 ～ 39 40 ～ 44 45 ～ 49 50 ～ 54 55 ～ 59 60 ～ 64 65 ～ 69 Over 70 PERCENTAGE The difference between Assets and Liabilities is 806 Trillions of Yen The young generations that will pay 806 trillion yen do not vote very much in national elections.

7. Blueprint For Japan 2020 Condition of Capital Markets (1) Rate of Market Capitalization to GDP PBR of TSE listed Companies PBR < 1PBR > 1 0 2000 4000 6000 8000 10000 12000 JapanU.S. (Billions of Dollar) Market CapitalizationGDP ※ Market Capitalization of Japan is derived from TSE. Market Capitalization of U.S. is derived from NYSE and Nasdaq.

8. Blueprint For Japan 2020 Condition of Capital Markets (2) Case of a large Japanese bank: Without any reduction of capital, about 20 billion dollars of public money was injected. On an annual announcement of some billion dollars of newly borne write-off for bad loans, the share price stays the same level. The share is still trading with the market capitalization of the bank to be about 20 billion dollars.

9. Blueprint For Japan 2020 0%20%40%60%80%100% U.S. Japan Cash & DepositBondInvestment TrustStockInsuranceOthers 54 % 11.9 % 34.1 % 7.2 % Japanese do not invest much into Stocks 1420 Trillion Yen 32.1 Trillion Dollar Condition of Capital Markets (3)

10. Blueprint For Japan 2020 Diversity is not recognized in Japan Needs to prevail the sense of diversity Needs for educational reform Needs for more to communicate in English ……… Diversity - Analysis

11. Blueprint For Japan 2020 Democracy - Analysis Democracy is not established in Japan Needs for the election system reform Needs for the media to become independent Needs for more disclosure of the nation state ………

12. Blueprint For Japan 2020 Capital Markets - Analysis Capital Markets is not working in Japan Needs for the independent SEC Needs for the reallocation of resources Needs for transparent corporate governance ………

13. Blueprint For Japan 2020 What to do? One idea is to create new indices, … not GDP, not Market Cap. Japan Diversity Index Japan Democracy Index Japan Capital Markets Index … and we track them.