Uncertainty is a growing concern in global affairs, one which has only been accelerating in recent years. Ongoing and potential crises include the UK’s Brexit movement and the fallout that will result whichever way the country goes; growing tension on the Korean peninsula; strains between the US and China in terms of trade disagreements and global power positioning; and the current ‘America First’ populist movement in the US. At the same time, digital transformation is sweeping through society and business, touching our lives at nearly every point.

In the face of all this, a different style of thinking is needed for formulating both government policy and business strategy. Speaking at the Foreign Correspondents’ Club of Japan, Hiroaki Nakanishi, Chairman of the Japan Business Federation, or Keidanren, and the Chairman of Hitachi, Ltd., explained the idea of Society 5.0: a concept of using technological innovation to achieve both social development and economic growth.

The idea of Society 5.0 originated in 2015. “The Japanese government cabinet decided on 5.0 as the most important concept of their science and technology plan over the next five years,” Mr. Nakanishi explains. “We are now discussing those kind of concepts in order to make clear economical growth for future investment. It’s not simply about businesses and profit-seeking, but also about how to contribute to society to solve various social issues.”

The name comes from the idea that humanity has advanced through four distinct stages: hunter-gatherer, agricultural, industrial, and the information age of today. With the rapid advance of digitalization into the physical world, we are supposedly on the threshold of a fifth stage in which digital thinking and creative thinking work together in ways that can solve social problems while creating value.

In comparison with the information age, or Society 4.0, Society 5.0 is expected to more flexible and sustainable as people, governments and businesses all become more conscious of their impact on the world and their potential for creative contribution. Mr. Nakanishi says, “How can we release all the various bottlenecks of our life? Some of the conceptual changes include how industrialized society was very much about economies of scale: big sizes, mass production, everyone uses the same things. The next stage is somewhat different: problem solving and value creation are the targets.” Similarly, the need for uniformity is expected to give way to a more diverse, personalized society; concentration of production will transition to a decentralized society where people can more easily work anywhere; vulnerability to economic, social and environmental change will be replaced with resilient systems and social networks that can securely withstand challenges; and the trend of high-impact mass consumption of resources will necessarily yield to focusing on greater stability and environmental harmony.

At the B20 summit this year, Keidanren and other international business leaders will be meeting together to reach a consensus on achieving Society 5.0, including how it will impact trade and investment, energy and the environment, quality infrastructure, employment, and health and well-being. They will present their final recommendations to the world leaders meeting at the G20 summit, being held in Japan this year.

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