The demise of the community firm and ‘Japanese-style’ employment have been predicted for almost as long as they have been recognized. Consider this observation, written forty years ago:

As many respectable scholars have predicted the end for so long, a certain caution is in order before we, too, join the chorus. We cannot assume, as many do, that a changing environment will automatically spell the end of the community firm. What has changed, and what has not? In order to answer this question, we first need to establish a benchmark.

As we wrote in chapter 1, our three empirical areas of focus will be employment practices, corporate governance and management priorities, or ideology. In addition, we need to look at the boundaries and nature of community membership. In this chapter we will sketch key features or practices associated with the postwar ‘classic model’ of the community firm in these four areas. These will provide a benchmark for evaluating change.

Members, quasi-members and non-members

We start with membership. According to Japan's Commercial Code the company belongs to its shareholders, and they are its members. The common perception is different, however.