ESG Management Across Cultures: A Study of American & Japanese Firms

Abstract

This study examines the Environmental, Social, and Governance (ESG) management practices of U.S. and Japanese firms. Through historical analysis and case studies on Toyota and General Motors, this research explores whether Japanese firms exhibit higher quality ESG disclosure than their U.S. counterparts, whether businesses prioritize short-term ESG issues with established public awareness, and whether cultural factors influence these differences. Findings reveal that both firms focus on ESG issues that enhance short-term gains with established public awareness. Contrary to expectations, Japanese firms show gaps in substantive ESG disclosures despite stricter regulations, suggesting that differences in ESG practices are driven more by regulatory environments and historical contexts than cultural factors.