In this final installment of a three-part series delving into Nomura Report 2024, our Group CEO Okuda talks about Nomura’s people strategy, risk management and corporate governance.
Summary
- Diverse values underpinning competitive strengths: Diversity enables us to adapt to the changing environment and makes us stronger as a firm. We will build on Nomura’s tradition of advancing young talent and foster an environment where highly skilled people from diverse backgrounds can work with enthusiasm and pride.
- Developing talent to create added value: Providing our people with opportunities to grow and develop their careers leads to added value for the firm. We offer study abroad opportunities, secondment to venture firms, training, women’s empowerment initiatives, and paternity leave to help employees thrive.
- Risk management and corporate governance: Nomura is enhancing our risk management and crisis management abilities and strengthening our corporate governance to enable us to swiftly respond to risks and global management issues. We are actively incorporating external perspectives to enhance discussions in these areas.
Our diverse talent pool and wide range of values are the source of our competitive strengths. We conduct various initiatives based on the thinking that our people create added value as our greatest asset. We provide opportunities for employees to grow and challenge themselves, including our study abroad program offered for over 60 years and our “Nomura Career” internal job posting program to help people develop their careers.
Starting in fiscal 2022, we have offered a training program where employees are seconded to a venture company for one year. After passing an internal selection process, they contribute as a team member at the company, learning strategic planning, project management, and business management, while experiencing the speed and innovation of a venture firm.
Our people gained valuable experience at five companies in fiscal 2022, three in fiscal 2023 and four in fiscal 2024 across various industries. I would like to thank those companies that welcomed our people.
I have been briefed by those who returned from secondment. They say their thinking has changed completely and that they were able to make many discoveries by looking at Nomura from the outside. I am truly pleased by the results and changes that this training is creating.
Nomura operates across approximately 30 countries and regions with a global team of about 27,000 employees from 90 nationalities. Inclusion is essential to bring out the most from people of diverse backgrounds. Equally important is ensuring a fair system to evaluate people. I have been focused on creating and communicating such a system since taking over as Group CEO.
Diversity is also important to adapt to the changing environment. I believe diversity makes us stronger as a firm. I want to build on our tradition of advancing young people and leveraging people with diverse backgrounds and highly specialized expertise to boost the corporate value of Nomura Group.
Nomura has a high percentage of mid-career hires, accounting for 70-80% of our people globally. But even if you look just at Nomura Securities in Japan, about half of all new employees have experience working outside Nomura. Despite differences in hiring tracks, everyone receives the same training, evaluation, and advancement opportunities. Of the 18 new executives appointed in April this year, five started their career outside Nomura.
A diverse workforce alone is not enough to invigorate an organization. We need the organization to be open to diverse values and ways of thinking to create an environment where everyone can be their true self. It is an important responsibility for me and the whole management team to facilitate that.
As of April 2024, the percentage of women branch managers and department heads at Nomura Securities was 10.2%, beating our April 2025 target of 10% ahead of schedule.
In October 2023, Nomura Securities in Japan introduced a childcare leave payment for employees taking childcare leave, regardless of gender. As part of the performance management for managers, we have introduced metrics around creating a workplace accepting of diversity, encouraging male employees to take childcare leave, and development of women talent. And we are reflecting initiatives on promoting understanding of diversity and equity in how we rate the performance of all employees.
This has resulted in the number of male employees taking childcare leave jumping 50% in the second half of the year ended March 2024 compared to the first half of the year. This has gained media attention and we are hearing clients say Nomura has changed for the better.
Employee engagement is another area we are keenly focused on. Communication is key as people must believe in what they are doing.
Developing and promoting risk culture and enhancing risk management remain key management issues for us.
To enhance our risk management, in addition to reinforcing our approach, including introducing specialized calculation technologies and hiring new people, the awareness and actions of each person is critically important.
We have a multi-layered risk management system with Three Lines of Defense underpinned by a policy of all executives and employees proactively taking responsibility for risk management.
To develop our risk culture we introduced an ethics, risk management, compliance and conduct (ERCC) rating for employees in Japan in 2020. This has now been rolled out to all employees globally across the Group.
There is no end to fostering risk culture and we will continue to implement initiatives in this area.
In 2023, we established the Resilience Department to oversee our resilience as a firm, including managing our recovery and resolution planning.
IT strategy and responding to cybersecurity threats are urgent issues critical to ensuring proper risk management and efficient business operations. We are taking a comprehensive Groupwide approach and have appointed a Chief Information Security Officer. Our reference points include guidelines issued by the Japan Financial Services Agency and frameworks from various countries including the US National Institute of Standards and Technology Cybersecurity Framework.
Enhancing corporate governance is important for us to achieve our management targets.
We have been welcoming non-Japanese to our Board of Directors since 2010. Currently, two thirds of our Board are Outside Directors. Non-Japanese account for one third of the Board and a quarter of our directors are women.
In 2015 we set up the Outside Directors Meeting as a forum to periodically discuss our business and corporate governance issues. To further enhance our corporate governance, Outside Directors were appointed to chair our three committees in 2019.
As the diversity of our Outside Directors has increased, we have been receiving a wider range of advice, which often includes critical feedback and tough questions. We have intense discussions and I feel the effectiveness of the Board has increased.
