Asia and Pacific

Contribution to SDG10 through Recruit Group’s business model “the Ribbon Model” and how it creates “SDG Domino Effects”

2022-03-28 11:34:01 sisd 21
Introduction

To reduce inequalities(SDG 10) that exist in the world, Recruit Group has been applying its unique business model, “the Ribbon Model,” since its foundation 1960.
The Ribbon Model is our business model by which Recruit stands in the center to connect individuals(users) with companies(clients). We provide staffing businesses and online platforms in industries such as HR, bridal, housing, travel, food, beauty, and education. In each industry in which we provide services, we aim to reduce inequalities by providing information and opportunities. By offering individuals more choices, we are able to provide optimal matching scenarios for the benefit of companies and industries.

Objective of the practice

The main objective of our businesses is to reduce inequality (SDG10) that exist in society and we apply AI to achieve this as we provide online services.

While we place the reduction of inequalities at the core of our businesses, to realize our vision of “A brighter world where all individuals can live life to the fullest,” we also contribute to creation of positive impacts on other SDG goals. We call this phenomenon “SDG domino effects,” which let us make a larger social impact on the world.

-Our SDG domino effects in our HR related services: SDG 10, 8, 4, 1
Our HR-related businesses are staffing and HR related media/platform businesses. We tackle the reduction of inequalities that exist in the job opportunities provided to people. With the concept of reducing inequalities (SDG 10) at our core, we provide people with decent work and economic growth (SDG 8). When people receive job opportunities, their family income helps eliminate poverty (SDG 1), and their children can receive quality education (SDG 4).
In FY2017, we created 260,000 job opportunities for people through our staffing business.
“Indeed” is an online job search engine operating globally with over 200 million monthly unique visitors, which enables users to find jobs and employers to hire talent.

-Our SDG domino effects in our diversity related services: SDG 10, 5, 8, 4, 1
As our business is focused on people’s lives, diversity is an important materiality. In Japan, participation by women in the workplace was announced as a national agenda. In order to contribute to this agenda, we provide HR-related services targeting women; our project that incorporates those services and additional projects to improve working standards for women is called “iction!” We are working to accelerate the participation of women in the workforce. To do this, we provide job opportunities for women who face time constraints, such as women raising children, through “Jitan Job,” one of the main services in “iction!” “Jitan Job” enables people with time constrains to work the way they wish. For example, they can choose to work for only a few hours per day and/or only a few days a week. As a human resource company, we negotiate with our clients to break down and simplify employees' work to create jobs that enable people with time constraints to work. By providing women with such job opportunities, we not only reduce inequalities (SDG 10) but also improve gender equality (SDG 5). When women obtain job opportunities, their family income increases and their children become able to receive quality education (SDG 4), which aids the elimination of poverty (SDG 1).
As of March 2018, we have provided 172,000 jobs to people who face time constraints through our “Jitan Job” service.

Key stakeholders and partnerships

Key stakeholders in our businesses are our clients and users since our business model is to connect them. By applying our business model, innovative partnerships are created.
For example, one of our businesses called “Quipper,” an online video learning service for students, we make partnership with goverments and local administrations.,
One of our partnership cities, Pena Nieto administration in Mexico City, offers Quipper to 20,000 students across 200 low-performing schools mostly located in poor neighborhoods. The city aims to reduce the economic disparity and the educational gap through affordable contents.

Implementation of the Project/Activity

Founded in 1960, the Recruit Group started as a business focused on recruitment advertising that targeted university students. While expanding over time into other human resources-related services, we also branched into promotional areas supporting life events and lifestyles,
Currently, Recruit Group operates businesses under three strategic business units (SBU): HR Technology, Media & Solutions, and Staffing.

HR technology SBU offers global online HR business in recruitment-related fields. “Indeed” is the main service and it operates a marketplace where job seekers are coming to Indeed to search for job opportunities, and companies with recruitment needs are advertising their job content to job seekers. Through Indeed's search engine, job seekers have free access to millions of jobs which have been aggregated from the web or posted directly to the site. “Indeed” offers employers, job boards and recruiting agencies access to millions of active job seekers across every industry and location.
The revenue from FY 2017 was 218.5 billion yen.

Media & Solutions SBU operates Marketing Media business and HR business. We provide online media/platform and paper based magazines in many industries such as HR, bridal, housing, travel, food, beauty, and education. We connect client companies in such industries and individuals who look for jobs, wedding places, house, places to travel, restaurants, beauty salons, and wish to study.
The revenue from FY 2017 was 679.9 billion yen.

Staffing SBU offers temporary staffing businesses of all the countries, in which we operate. We asecertain the needs of staffing service users, individuals seeking to work in temporary roles and clients companies looking to employ temporary workers. We dispatch staffs to our client companies.
The revenue from FY 2017 was 1298.8 billion yen.

Results/Outputs/Impacts

Outputs from FY 2017 are as follows.
Revenue: 2173.3 billion yen
EBITDA: 258.4 billion yen (EBITDA=operating income + depreciation and amortization ± other operating income/expenses)
ROE: 19.3%
Cash flows from operating activities: 194.1 billion yen
Awards received: over 130 “Great Place to Work,” ads, services, etc.
Published employment ads: 20 million jobs on Indeed
Unique visitors per month: over 200 million (Indeed)
Number of workers receiving employment opportunities (staffing): Approximately 260,000
Number of new business applications for Ring (internal business proposal system): 988
Percentage of women in management: 25.2% (Japan)
Number of users receiving free job placement services; 125,000 to date (Japan)
Success rate in compliance exams: 100% (Japan)
Companies in the Group with ISO 14001 certification; 14 in Japan, etc.

Enabling factors and constraints

■ Enabling factors (Opportunities for Recruit Group)
With so many technological innovations recently, AI that has enabled deep learning is one example of the major role technology can play in connecting people to each other in cyberspace. One of the biggest advantages of AI is its ability to deliver information tailored to each individual’s needs from an encyclopedic collection of all the world’s information.
Our service, “Indeed” is an extremely competitive platform for matching job seekers with employers through the effective use of machine learning. First of all, in an increasingly information-based society, “Indeed” uses aggregation technology to scour the worldwide web for job listings in order to maintain the completeness and freshness of job information.
Secondly, teams of engineers with advanced technical skills analyze in detail the assembled big data, refine algorithms daily to improve matching relevancy, and provide users with stress-free access to job listings around the world.
In the future, we believe it will become possible for highly encompassing matching algorithm technology to be used on a broader set of information, in addition to job listings.
Through technological innovation, Recruit Group aims to make the world “faster, simpler and closer to you.”

■ Constraints (Risk for Recruit Group)
One of Recruit Group’s most valuable assets is data. A core theme in our business is “matching”—using data to connect market participants. Through this process, Recruit Group receives, transmits, stores and uses data from its many customers and clients. Data is also critical in our global business operations, including use of data in compiling and analyzing business results and connecting with and supporting its many valuable employees. Appropriately managing personal information is a top challenge and priority for Recruit Group’s business management. Although protective technologies continue to develop and improve, so do the technologies and methods of those who attack IT systems of companies such as Recruit Group. We have and will continue to expend significant resources to manage and secure data, and our employees include many data management and security specialists. Like many leading companies, we employ multiple types of security defenses, including firewalls, antivirus scanning, vulnerability assessment and analytics, access controls, vulnerability reporting rewards, computer security incident response teams, and employee training.
Recruit Group strongly believes risk is best managed in a culture that emphasizes empowerment, transparency and accountability. Those at the business front-line or “gemba” should be empowered to make decisions and manage risk based on knowledge of local conditions and subject to global minimum requirements. Risk-related information should be transparently shared with SBU management and ultimately with Recruit Holdings leadership. Based on this information sharing, employees should be held accountable for properly managing risk. Recruit Group uses a variety of tools and structures to ensure its transparency and support this comprehensive risk management culture, including periodic auditing by its Internal Audit Department.

Sustainability and replicability

Recruit Group has its unique sustainability strategies called “Sustainability Orbit.” We place this strategy in order to realize our corporate vision of “a brighter world where all individuals can live life to the fullest.” We engage with our stakeholders and grasp international sustainability trends, in order to understand the demands and expectations for the Recruit Group and the roles that we must fulfill. Our findings from stakeholder engagement and international sustainability trends, and what actions would be needed are discussed in the Sustainability Committee attended by internal management, including the CEO and external experts. Proposed actions discussed in the Sustainability Committee are resolved at the Board Committee, and the internal management members execute the plans. We repeat this cycle every year.
Since we have this strategy, environmental, social, and economic sustainability and resilience are retained. As we continuously grasp changing needs, demands, expectations from stakeholders and society, and having the governance system where those issues are discussed within the management, we could be well prepared and quickly adapt to the changing needs of society.

Conclusions

Recruit Group’s core competencies are the three values that our employees possess, and because of those values, our unique business advantage that we call the Ribbon Model, which realizes our mission of “Making life opportunities faster, simpler, and closer” can be sustained.

Our Three Values:
1: Wow the world: Creating new values that resolve inequalities and inconveniences that exist in society.
2: Bet on passion: We are a team of people fueled by curiosity, and encourage each other to act on our own internal motivations and to follow our hearts.
3: Prioritize social value: As global citizens, we strive to contribute to a sustainable society through all of our corporate activities. Each one of us is committed to seeking out the needs of society and taking action for a better future.

The Ribbon Model
The Ribbon Model is our unique business model by which Recruit stands at the center to connect individuals (users) with companies (clients). By offering individuals more choices in how they live, we are able to provide optimal matching scenarios for the benefit of companies and industries. Our corporate mission is “To create life opportunities for more people, we provide opportunities that are faster, simpler, and closer.” In providing services, we apply the Ribbon Model in industries including HR, weddings, housing, education, and food.
In every industry in which we provide services, we continuously connect users and clients.

We recruit people who possess our three values, and we continuously nurture those values by applying two mechanisms. The first is our custom of constantly asking each other “Why are you here?” as we work. (“Why are you here?” implies “What are your own internal motivations for this job?” and “What should you do?”) We ask this question to ignite employees' own inspiration to take on work responsibilities, and we require that they thoroughly explain their passion in order to receive final approval from bosses. This question is also asked within the context of individual potential in order to put employees on a firmer path toward their goals, which leads to the setting of even higher goals. Ultimately, this process leads to the strengthening of our company’s competencies (also described in previous questions) and the three values our employees possess: “Wow the world,” “Bet on passion,” and “Prioritize social value.”
We also encourage our employees to create innovations. Recruit confers group-wide internal awards in competitions for new services, innovations, and more. The winning services are widely shared within our company. Such an environment enables our employees to proactively create innovations.

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