Kanagawa Model Factory Council Membership Guide

SME manufacturers account for about 99.7 per cent of Kanagawa Prefecture's factories with four or more employees. According to preliminary survey results released by prefectural statisticians, in 2019 the Kanagawa was home to 7,349 such operations. They are of critical importance to Japan's economy, having employed 355,924 and shipped some \18.4 trillion worth of goods that year.

The purpose of the Kanagawa SME Model Factory Program is to promote the vitality of SMEs in the prefecture by identifying factories and workshops that can function as models for their peers. Such enterprises are designated for their ability to show others the way forward through their exemplary engagement not only serving their communities by providing business opportunities and employment and underpinning manufacturing in Kanagawa, but also running themselves with enough flexibility to adjust nimbly to changes in the business environment and actively pursuing development and innovation of new technologies and work methods.

Candidates for designation are nominated by local prefectural administrative centers (Kensei Sogo Centers), the Kanagawa Institute of Industrial Science and Technology (KISTEC), and Kanagawa Industrial Promotion Center (KIP) from among the factories and workshops in the prefecture with a record of excellence. A committee then screens candidates and selects those to be awarded designation. The prefectural governor designates the selected factories for a period of three years, and designations may be extended upon renewed review by the screening committee.

<Eligibility for designation>
To be eligible for designation, a factory or workshop must:

1. belong to an SME whose chief business is manufacturing as defined in Article 2, Section 1, Paragraph 1 of the Small and Medium-sized Enterprise Basic Act (Act No.154 of 1963);

2. have been previously recognized by the governor with an award for excellence or equivalent;

3. have been continuously in operation for at least three years in the prefecture, in principle;

4. not be more than 50% owned by a non-Article-2 SME (i.e., a large enterprise) or have on its board a director(s) placed by such a non-SME; and

5. fully understand and appreciate the implications of the program and be willing to cooperate in its activities.

<Major screening criteria>

1. Prevailing conditions for the company's industry sector, enterprise scale, distinctive attributes, engagement with the community, and other such factors, as well as whether the organization for running the business is flexible enough to allow it to adapt rapidly to the immediate business climate as appropriate for the conditions in which the business operates
2. Tax payment standing, environmental protection filings, generation of pollution, repayment of public loans, labor practices, work accidents, and observance of other minimum criteria defined by labor standards. Candidates must also be in good financial health