An Analysis of the Progress of Japanese Companies' Commitment to the SDGs and Their Economic Systems and Social Activities for Communities

Japanese companies are making rapid progress in addressing the Sustainable Development Goals (SDGs), and there is growing interest in the relationship between these goals and financial performance. Moreover, the promotion of the SDGs at the local level encourages opportunities for collaboration with companies. This study analyzed the relationship between the status of SDG efforts and the financial data, as well as social activity data of 533 Japanese manufacturing companies from 2016 to 2020. In terms of academic contribution, this study provides a unique case study in Japan, with consideration of the timing of the initiation of SDG efforts. The results showed that large companies and companies with high profitability tended to start working on the SDGs at an early stage. The results of a comparison of industries showed that the timing of the initiation of SDG initiatives is not affected by profitability in the food and electrical equipment sectors, where SDG efforts are already well underway. From the results of multiple regression analysis, it was found that large companies with high profitability that have implemented social activities tend to be early adopters of the SDGs. The results of this analysis suggest that it is important to design measures that are appropriate based on the size of the focal company and that social contribution activities should be incentivized to encourage companies to act on the SDGs.

Automated summary

Japanese companies are rapidly progressing in SDG efforts, with larger and more profitable companies being early adopters. The food and electrical equipment sectors already have active SDG initiatives. Designing appropriate measures based on company size and incentivizing social contribution activities are important for encouraging companies to act on the SDGs.