Japanese Companies Welcome Introduction of Security Clearance System; Hope for expanded business opportunities in economic security

As addressing economic security becomes an urgent issue for business operations, the business community welcomes the law to establish a security clearance system as it will lead to greater business opportunities.

NEC Corp. noted on Friday: “The reliability of Japan’s information management will improve, enabling further international cooperation.” Mitsubishi Electric Corp. said: “The opportunity to be involved in joint development and academic communities will increase. We would like to actively consider deploying the system.”

Companies are calling for the introduction of a security clearance system because there are cases when they need to appoint qualified personnel who can handle crucial information when conducting research and development in advanced technologies with the United States and Europe.

In a survey conducted by the Institute of Geoeconomics, a private research institute affiliated with the International House of Japan, 55.6% of Japanese companies that responded stated that they “expect not to be able to participate in projects in the future.” take” due to the lack of a security clearance system. There have been cases of companies abandoning their participation, with one major electronics manufacturer confiding, “If we don’t become part of the supply chain, it won’t generate business.”

The number of companies hiring highly qualified personnel from abroad is increasing and the internationalization of Japanese companies is also continuing. There are concerns about information leakage by malicious foreign employees, and a major telecommunications company was faced with a situation where they felt they should “carry out their own screening to the extent possible, but there are restrictions on companies.”

With the introduction of the new system, the burden on companies will probably increase, for example in terms of costs. It will be necessary to create special departments for the handling of confidential information and to establish a system for the protection and disposal of the information.

In the United States, it reportedly takes about six months to a year for approval. If a similar period were necessary in Japan, this could mean restrictions on personnel transfers and other matters. However, Tomoya Suzuki, an associate senior researcher at the NLI Research Institute, said: “We are entering an era where economic security defines business operations, and the introduction of this system is an example of that. Companies must recognize the changing environment and respond accordingly.”