Miwa Seki: Establishing an ESG Investment Fund to Solve Social Issues

This fund was launched by three women: my friends Kathy Matsui (former Vice Chair of Goldman Sachs Japan) and Yumiko Murakami (former Tokyo Director of the OECD).

Fortunately, we have reached nearly 160 billion yen, close to our target amount, and fundraising is almost finished. In parallel, we have started investing in three companies. Recently, we invested in an overseas climate data analytics company. Our team has also expanded and now consists of eight people.

Another is a company doing DX (Digital Transformation) for nursery schools. In Japanese nursery schools, childcare workers are exhausted because they have to check on children one by one during nap time. This company developed a machine that can automatically track and record this via sensors, helping to improve the productivity of childcare workers.

That's right. The other company provides a multilingual platform for websites and apps, and that platform is used for many of the subway and private railway operations in Tokyo.

We want our investment targets to be "tech-enabled sustainable living" startups—those that contribute to sustainable living made possible by technology. There are five fields: first is medical, healthcare, and wellness. Second is fintech, providing support through technology to areas where money is not reaching. Third is aiming for better ways of working that contribute to productivity improvement, like the productivity improvement for childcare workers.

The fourth is platforms for "new consumption" forms such as the circular economy or sharing economy. The fifth is environmental areas such as responding to climate change. We want to support startup companies that can be expected to grow in these five fields.

Ms. Murakami is a friend from graduate school, and I met Kathy when I was a fund manager. We've known each other for over 20 years.

At one point, we talked about how this ESG wave might be necessary for Japanese companies to become truly global. Since unicorn companies (unlisted venture companies with a valuation of over $1 billion within 10 years of founding) don't easily emerge in Japan, we discussed whether we could plant the DNA of ESG into the growth strategies of young companies. That's where the idea for an ESG-focused venture capital (VC) firm came from.

Also, since women are still overwhelmingly few in the startup world, I thought our fund could differentiate itself.

It is seen as a very large amount for a women-led fund. Many investors say they want to verify the relationship between ESG and corporate performance as a case study, and see how the companies we invest in implement ESG and how that relates to stock prices and corporate value.

Currently, institutional investors are making investments with a strong awareness of ESG in listed stocks, and they want to do the same for unlisted stocks eventually, so I think they are interested in our fund for hints.

We invest in startup companies that are expected to go public in two or three years. Since they need to prepare for listing, including governance, we provide advice on market requirements.

It was released at the beginning of 2019. One of the authors is a Swedish doctor specializing in infectious diseases, and the month it sold the most was May 2020, after the COVID-19 outbreak. It sold well in 2019 too, about 500,000 copies, but it sold even more the following year.

Right now, rather than new translations, I'm thinking of finishing what I left behind. Actually, I was thinking of quitting after "FACTFULNESS" was finished, so in that sense, I feel I've reached a turning point.

I am the youngest of four siblings. I have three older brothers, and when my brother who is 12 years older (Toshihiko Matsuo, Chairman of Tirol Choco Co., Ltd.) entered the Keio Faculty of Law, I was in the first grade of elementary school.

While my brother was in university, my mother took me to the Mita Festival for the first time. I saw my brother's oil painting from the Palette Club displayed in a classroom and thought it was wonderful. That's when I decided I wanted to go to Keio.

I loved books and read the entire collection of world literature we had at home, and my three brothers also read a lot. Because of that, I naturally wanted to go to the Keio Faculty of Letters.

However, the surrounding environment was a coal mining town, and there were people living in very harsh conditions. My father ran a company called "Tirol Choco," but the factory was struggling until my brother entered university.

After I entered elementary school, the household finances gradually improved, but in the same elementary school, there were many children of miners from closed mines living in row houses called "tanju." It felt like a town left behind while Japan was experiencing high economic growth. Some of my elementary school classmates were working at the Tirol Choco factory when I was in high school.

It does. I want to give back even a little for the fact that I was lucky enough to survive and receive an education.

It was very fun. What I remember vividly is an English class in my first year where we read the play "Amadeus." That was so interesting. I'm grateful for the experience of reading a play in English from beginning to end for the first time.

My major was the Major in Human Sciences, and I joined the seminar of Professor Toshiaki Iseki, who specialized in marketing. I was interested in copywriting and wanted to go into the advertising industry.

At the time, I didn't really understand the appeal of being a corporate employee. I joined the company two years after the Equal Employment Opportunity Act was enacted, but there were only a handful of female university graduates in the company, and it was hard to imagine staying until retirement. Around that time, I was in a car accident and quit after being hospitalized for a while.

It wasn't that careful, but I read a book called "Women of Harvard" translated by Masako Egawa, who graduated from Harvard Business School (HBS) in the 1980s. It said that among the women who graduated from Harvard in the 70s, none who had families had succeeded in their careers. It said the only way to balance both was to be a lawyer, doctor, or teacher.

But I thought our generation might be different, and I wanted to go to HBS to open up a different world. First, in Japan, I joined a foreign investment bank that had just been established at the time. It was a new world and very fun. It was a small team, but after two or three years as an analyst, everyone went to business school like they were on a conveyor belt.

There were 800 students in a year, but the ones I associated with closely were the 90 people in my section. Everyone had different nationalities, but they were from the same companies, like McKinsey in the Netherlands or Goldman Sachs in Indonesia, so there was actually a lack of diversity. Everyone was elite, and especially those from developing countries often grew up in privileged environments.

The classes were tough, mainly due to the language barrier. If you didn't speak up, you'd fail, so the pressure was immense. During a 90-minute class, everyone fought for time to speak, so it was very difficult to break into that.

The two years at Morgan Stanley were tough. I was like a fresh MBA graduate. We, called associates, were in a place called the "bullpen" and were assigned various tasks day and night.

When I was at an investment bank in Japan, I read the original version of Michael Lewis's first book, "Liar's Poker." It was truly interesting. He was still unknown and not much different in age, and he wrote his first book while he was an associate at Salomon Brothers.

The next day, while walking in Yurakucho at lunchtime, Michael Lewis actually walked toward me from the other direction (laughs). It was an impossible coincidence, but I said, "Excuse me, you're Michael Lewis, right?" and he said, "Yes." When I said, "I read your book yesterday," he was very surprised.

I've only met Mr. Michael Lewis that once, but wanting to translate his book someday became the motivation for me to start translating. However, I haven't achieved it yet, and it remains on my "bucket list."

That's right. It was a book called "I Don’t Know How She Does It" by Allison Pearson, which Kathy Matsui gave me after I returned from the US. I really wanted to translate it and negotiated, but unfortunately, someone else was already translating it into Japanese.

The protagonist was a fund manager with two small children, and it felt very real, like looking at myself, and it was interesting. But when I thought about it, they wouldn't ask someone with no experience to translate a whole book out of the blue, so I knocked on the door of Diamond, Inc. and pitched myself.

Yes. Eventually, I was able to publish books. Around that time, I decided to quit as the Tokyo branch manager of the US investment advisory firm Clay Finlay.

Rather than for the sake of translation, I quit the company because I felt it was wrong to be receiving a high salary when I wasn't the real deal as a fund manager. Then my husband left the house. I was in trouble and considered returning to the financial industry, but it was during the Lehman shock and there were no jobs. However, there was demand for translation work if I wasn't picky, so I began to concentrate on that.

I consulted a lawyer to finalize the divorce terms, and I thought, "Can I really get this much money?" and mistakenly thought I could become one too (laughs). But once I entered the Faculty of Law, I realized I couldn't possibly take the preliminary exam unless I quit my translation work. So, passing the bar exam is also on my "bucket list."

Kathy invited me. Kathy knows Kamal Ahmad, who founded AUW and was at the World Bank, through Harvard. Bangladesh was one of the poorest countries in Asia ten-odd years ago, and there were no opportunities for higher education, especially for women. Kamal had a dream of creating a higher education institution there on par with those in the West. He asked if I could help with fundraising activities for that.

Recently, Kamal showed great diplomatic skill and was active in Afghanistan. The US provided scholarships, and many students from Afghanistan came to AUW every year. However, almost all of the approximately 140 current students and graduates had returned to Afghanistan due to COVID-19.

So, during the recent turmoil, he negotiated with the US government to have visas issued for everyone, and about three days after the Taliban entered Kabul, he had everyone escape to the US on a chartered plane. I think they will be allowed to transfer to American universities.

That might be true. I don't think there's such a thing as all-or-nothing, so I think it's better to move forward and improve, even if it's little by little.

I think I'm optimistic about the future. The world goes in many wrong directions, but in the long run, I think humans eventually move toward the better, bit by bit. So I think it's better to believe in the good parts and find a middle ground that isn't at either extreme.

I think it's better not to plan too much. Things usually don't go as expected. Like with this fund, I think life is more fun if you don't plan so much and just think you'll fix it if it doesn't work out.

Young people often ask when they should have children, worrying about balancing it with their careers. I tell them, "Anytime is fine. The time to have a child is when you get pregnant." I think it's good to go with that kind of feeling.

Also, perhaps learning to delegate to others. Looking at Kathy and Ms. Murakami, they delegate well and then close their eyes to the rest. I feel that creates various virtuous cycles.