Tominaga’s briefing on the background of ORIX had filled in many of the blanks, but what was more important in some ways was what I’d read in between the lines. I now had a much better sense of who Chairman Miyauchi was and how he came to be such an integral part of the ORIX story. Now I understood that he was present at the beginning, one of the “founding fathers” of the company, although he was still quite young at the time. And I understood something essential about his clear-cut management style: He had never spent much time in a traditional Japanese company. After his university education in Japan, he went to the United States and studied American business principles. He came back to Japan to work for Nichimen and almost immediately was sent overseas again, this time to study for an “MBA in leasing” at the USLI School of Business.

When Miyauchi returned to Japan a second time, it was to help establish a new company, what would ultimately become his company. It’s not at all surprising that his management style seems part Japanese and part Western: He learned the foreign style overseas and the Japanese style as President Inui’s right-hand man. All that talk about company DNA was making more sense than ever. It meant that one man could have an enormous impact on a company’s growth and culture. Obviously, much of the DNA came from Miyauchi, but now I saw that a fair bit of Miyauchi’s managerial DNA came from his mentor, the original architect of what would become the ORIX Way: Mr. Inui.

Of course, all this made me want to meet Miyauchi more than ever. But first I needed to follow protocol. In Dallas, Nishitani had promised to set up a meeting with ORIX’s president. If I played that card well, with a little luck, I might get in to see the chairman, even if only briefly. At least, that was my hope.

So I asked Tominaga if he could look into the arrangements for me to meet with President Inoue. He checked with the PR department and the president’s office and said that the memo from Dallas was already in hand and, yes, President Inoue would make time to see me. All I needed to do was pick a week and his secretary would find an opening and get back to me. I mentally thanked Nishitani and asked if it would be possible to meet as early as the following week. I realized that this was extremely sudden—just as in the United States or Europe, many big-company CEOs’¹ schedules are booked months in advance—but what did I have to lose by trying? The reply came less than an hour later: Mr. Inoue would be pleased to see me the following Friday at 10 A.M.

Once again I made my way to the World Trade Center in Hamamatsucho. A soft-voiced woman in a dark, well-cut suit (not the standard Japanese company uniform) appeared from a side entrance in the Reception area. “Mr. Russell?” she said in clear, only faintly accented English. “This way, please.” She guided me back to the elevators from which I had just arrived, and escorted me up another dozen floors. When the doors opened, I knew I was on an executive meeting floor. It had thick carpets, wood-paneled walls, and a deafening quiet all around. My escort bowed slightly as I stepped off the elevator, then showed me down a long hallway to a large, comfortable meeting room. There were half a dozen giant armchairs arranged in a rectangle around a couple of low tables. A decade or so ago, the tables would have held oversized ashtrays and attractive boxes filled with cigarettes, but times have changed, even in a smoker’s heaven like Japan. The walls were decorated with oil paintings and, on one side, a framed piece of Japanese washi paper with two large, brush-stroked characters and a lot of much smaller writing on it.

While I was still trying to decipher the scroll, the door opened and another secretary appeared and bowed deeply as the president entered at a brisk pace. He strode directly up to me, did a little half-bow as he extended his hand, and announced, “How do you do? My name is Inoue,” in a powerful but unthreatening tone. He asked cheerily if we were going to do the interview in English, and when I said I would be willing to bumble along in my broken Japanese if he didn’t mind my lack of formal, honorific speech. Clearly, he was more worried about having to struggle with an hour of Q&A in English than about all the social faux pas that I was likely to make. His face suddenly brightened, he flashed a broad, relieved smile, and motioned me to sit down.

My first impression of Inoue was that he was sharp, had an expansive yet detailed understanding of his company’s vast business network, and also held strong personal opinions on a variety of issues. I felt that anyone who met him would know instantly that he was a top exec at a major company. He was not overly forceful or intimidating; on the contrary, he was extremely polite and friendly. But he exuded both complete self-confidence and a sense of decisiveness. As I quickly discovered, he answered questions directly, liked to say yes or no clearly, and seldom waffled on any issue. Not your ordinary Tokyo “salaryman” by a long shot.

More than that, he seemed to be a guy who enjoys life. He laughed frequently during our talk. He was the type of guy I could see myself having a beer with sometime, which is not something I think very often during interviews, even when I’m talking to executives in the United States.

Finding a Comfort Zone

In Japan, journalists are held in much higher regard than they are in the U.S. or England. Yet even in Japan, executives do not like talking to journalists and even less to foreign journalists because we ask such annoying questions. I think all executives understandably begrudge the valuable time they could be using to deal with important business instead of listening to yet another reporter ask essentially the same questions that were posed by the person last week.

Hence, my normal strategy is not to sound like a journalist at all. I like to make Japanese executives feel comfortable. Step one is doing the interview in their language. Poor as my Japanese is, it makes them feel much better to avoid struggling with English or having to go through an interpreter, which is slow and awkward. I try to get them talking about anything at all, but preferably about something they know inside-out and can talk about without thinking. Anyone can discuss simple details of their personal history, so I like to begin with the easy personal stories, then move from one comfort zone to the next, and then finally on to more challenging questions. I said to President Inoue:

When did you join ORIX? What made you interested in the leasing business?

He laughed. “I graduated from university in 1975. I was 22 and couldn’t find a job anywhere. Many of my classmates were headed off to shosha, which were high-status jobs back then. My father suggested this firm called Orient Leasing, because he knew some people there. I said, ‘Orient what? Never heard of it.’ I managed to get a job interview with someone from OLC, and in the interview I asked him what a lease was. He said maybe I’d better learn a little more about the company before coming for an interview. So, no, I wasn’t interested in leasing; I didn’t have a clue what leasing was. But neither did any of the other 300 kids who applied. We had to take a battery of tests, and I guess I did okay, because I was one of the dozen applicants they let in.”

Did you go right into sales?

“No, they put me in the international department. I told them, ‘This is crazy, I don’t speak English.’ They said, ‘No problem. You’ll learn.’ The same was true for the leasing business itself. I knew nothing about leasing, but I was soon working on ship leases, which were the biggest big-ticket items we had. I traveled to Hong Kong and Greece and learned about the shipping business on the job, in English, of course. I learned by doing. If someone had asked me when I first joined the company what I might like to do and then let me choose my own career path, I would have taken something safe and comfortable and learned very little. I’ll say this for ORIX: It really helps employees to grow.”

How about the company’s growth? I asked a securities analyst friend in Tokyo to look into ORIX and he was surprised to see how much a big firm like yours is still growing. He said the company should be relatively mature by now, but it doesn’t look that way at all, which is unusual.

“We’re a very unusual firm,” he said, smiling slyly and taking a deep breath before launching into his well-rehearsed financial speech. “Let’s see, our total consolidated revenues in the fiscal year ending in 2013 were over 1 trillion yen, which is, very roughly, $10 billion. Our net income was about $1.2 billion, which was a 34 percent increase over the previous fiscal year, and that year was a 28 percent increase over the year before. We’ve recorded four consecutive years of double-digit increases in profits. Not the sign of a mature business at all, and especially challenging for a firm with over a trillion yen in sales. Meanwhile, ROE increased to 7.4 percent from 6.2 percent, our debt/equity ratio continued its steady decline (I think we’re in the low twos now), and our dividends per share have continued to rise. . . . ”

I imagine that investors are quite pleased with your performance.

“I hope so. We are proud of our solid performance, in good times and bad. ORIX has continued to post profits even during years when there were major shake-ups in the business environment, such as the oil shocks in the 1970s, the collapse of Japan’s bubble economy in the early 1990s, and the big financial crisis that started in 2008. Many other businesses, including many financial firms, have gone under as a result. ORIX has not only survived, but has continued to grow. All of our six business segments are profitable, and we have new businesses coming on stream all the time.”

Time for another softball question. Just how big is ORIX today?

“Let’s see. . . .” He closed one eye and looked up at the ceiling with the other. “We have over 20,000 employees working in 34 countries, roughly 650 consolidated companies, and about 90 affiliates.”

All right. Enough with the easy questions. He’s looking relaxed and knocking these out of the ballpark one after another.

China: No One to Blame but Ourselves

I mentioned that I’d spoken to both Mr. Liu and Noguchi-san about the company’s past and present operations in China. He looked a bit surprised but nonplussed. I mentioned that I’d heard about ORIX’s rough start in that market, to which he responded: “Actually, our start-up was pretty smooth. We went in in 1981 with an initial investment of $200 million, if I remember correctly, and we recouped all of that within about two years.”

I said that I’d heard that things did not go so smoothly in the years that followed. Of course, I knew this was something of a sore point inside the company. But Inoue didn’t flinch. “Yes, we had some problems two decades ago,” he said, and then summed it up quite diplomatically. “Having problems in a foreign market is nothing unusual. But in China our biggest problem was our own fault. Our mid-level managers back then did not take China seriously enough as a viable market. They saw it as a country just beginning to emerge from decades of stultifying, state-managed enterprise and trying to become a modern, free market like Japan overnight. We didn’t have staff who spoke Chinese, we couldn’t negotiate directly with our JV partners, and for a variety of reasons we couldn’t earn their respect.

“Looking back on it now, I can’t blame the Chinese for anything. First of all, just talking about the China of 20 years ago is like talking about Japan 100 years ago. It was a very different country back then. Second, we were a different company as well. We thought of ourselves as completely international, but we failed to adequately prepare to do business in a very important foreign market. That was our mistake. We have no one to blame but ourselves.”

I admired his attitude—willing to admit there had been problems in the past but reluctant to place blame on others. The drift I was getting from both Noguchi and Inoue was basically, “We made mistakes; we learned; we will do better.” That sounded very much like the ORIX I had been hearing about all over the world. I was ready to drop the China discussion and move on to other things, but the CEO suddenly livened up.

“Take a quick look at our more recent endeavors in China. I think that tells a much more important story. For example, with the country’s massive industrialization, the need for extremely precise, high-quality measuring equipment has grown steadily. In 2004, ORIX set up a specialized company in Tianjin to rent precision measuring equipment. We were the first Japanese company to establish a rental company in China handling this kind of equipment, and it quickly expanded to six branches around the country.

“A year later we received permission to set up a leasing company in Shanghai, with ORIX putting up 95 percent of the equity and the remaining 5 percent coming from a Japan-registered firm directly affiliated with the Shanghai municipal government.

“Less than six months later, we set up a major JV called China Railway Leasing Company. I don’t have to tell you the importance of railroad growth to the expanding Chinese infrastructure. Between now and 2020 the government plans to add about 20,000 kilometers to the existing network. That means a steady demand for rolling stock, heavy equipment, electronic control devices, maintenance equipment, and much more. In the future, it could spell a need for housing, urban development, and all types of ancillary services.

“This is a massive undertaking. Current projections come to roughly 1.3 trillion yen of investment every year for the rest of the decade. The Ministry of Railways needs to better diversify its funding sources, and we see this as a perfect opportunity to strengthen our position in China by playing a key role in one of the biggest infrastructure projects of the decade. We are proud to be a key part of the first railway leasing company in China.”

I interrupted to ask who ORIX’s partner was and how much equity each party held.

“The China Railway Materials & Supplies Corporation, known as CRMSC,” he replied directly, “which is 100 percent owned by the Chinese government. Until 2004, CRMSC was part of the Ministry of Railways, but it was spun off to act as a general trading company. Today, it has the fourth highest sales of any state enterprise in China. In other words, an excellent partner to be working with. ORIX holds 25 percent of the JV. We were selected as the sole foreign partner because of our experience in financial services and our long track record.”

Inoue went on to list up several more ventures in China, ultimately giving me a lot more specific information than even Mr. Liu had done. Finally, I asked if he was worried about a repeat of the problems of the past. “Not at all,” he said confidently. “We do thorough due diligence these days. And we don’t rely on the courts to solve our problems. Part of the due diligence process in China involves looking into family backgrounds, personal and government connections, and so on. We understand how to use the traditional network of interpersonal relations to effect change, and we are increasingly handing over management to our local staff who understand that system and can use it much better than we ever could.”

Korea: Different Challenges

We had talked a lot about China, but I also wanted to hear about South Korea, which Tominaga told me was one of the more interesting examples of the company’s Asian strategy. Needless to say, Japan and South Korea have a very difficult relationship, geographically close but, as with China, separated by historical mistrust that goes back generations. Japan invaded the Korean peninsula as far back as the sixteenth century, and then, from 1910, occupied it for 35 years. Japan’s strict governance during that period is still a sore subject even for young Koreans.

However, the South Korean economy was one of the famous “Asian Tigers” of the late twentieth century, a small powerhouse of growth that continues today. Early on, Inoue told me, ORIX saw potential for the nation to become one of the fastest-growing economies on the planet and invested there back in 1975, even long before it entered China. In keeping with the standard ORIX strategy, they set up a joint venture with three Korean banks and an international financing agency. ORIX took approximately a 30 percent stake in the new company.

As the South Korean economy took off, it followed a similar path to Japan in the 1960s and 1970s, a model that ORIX was quite familiar with: Both heavy and light industries grew rapidly and needed to expand. New factories required new equipment, but there was not enough available capital for all the companies that needed it, and smart managers quickly learn to manage cash flows efficiently. Leasing equipment rather than buying it became a key tool in helping businesses to grow. So, just as it had in Japan, the Korean economy’s expansion fueled the growth of this new little leasing company.

“Ultimately, two problems prevented the first ORIX venture from succeeding,” Inoue said. “One was the ‘big fish in a small pond’ problem: That is, the total South Korean market was still quite small by international standards. So, even though the JV company was growing and establishing itself as a premier solutions provider in its home market, there were clear limits to its expansion. Its strategic response was to expand overseas, beyond Korea.”

So, as Korean companies began to venture beyond their national borders, the JV also expanded—to Hong Kong, Indonesia, Thailand, and elsewhere—both to serve its Korean clients and to attract local business in each market. In that way, the firm was able to deal somewhat with the limitations of its domestic market.

But the second problem was the killer, Inoue told me. In 1997, the red-hot South Korean economy ran into trouble, what is now called the Asian financial crisis, which affected half a dozen countries in the Pacific Rim. The Korean stock market plunged, the local currency lost half its value, and some of the biggest, most well-established businesses in the nation went under. In less than one month, Moody’s downgraded South Korea’s sovereign credit rating from A1 to B2 (a precipitous drop), and it is widely believed that the economy survived largely due to the intercession of the International Monetary Fund (IMF).

It was this crisis that broke the JV. However, thanks both to the IMF and the awesome power of the Korean workforce, the local economy bounced back, and by the early part of the new century it was once again the fastest-growing economy in the world. In the new South Korea, affluence trickled down even more to the general populace and, just as it had in Japan, a new generation began to expect to own a home, a car, and other signs of an affluent middle class.

“Against that background, in 2004 the Group opened a 100-percent-owned subsidiary, ORIX Capital Korea Corp., to help both corporates and individuals obtain vehicles through efficient financing.

“Now our new Korean leasing company is starting to do well. I’m pleased to say we have learned valuable lessons from the challenges we faced in both China and South Korea, and the result is that we are doing much better in both markets,” Inoue said.

The Business of Energy

My notes had several references to the company’s nonfinancial businesses. That included what it calls facilities operation, which covers managing Japanese inns, hotels, theaters, even aquariums. I asked Inoue about this aspect of ORIX’s business.

“Yes, we do have some nonfinancial businesses,” he said. “And they are increasing slowly. Our idea has always been to move from a purely debt-based business to something with a mix of debt- and equity-based income. Part of that strategy means we want to operate facilities, not simply invest in them as real estate assets. We have a small but quite varied portfolio of facilities here in Japan, and I expect it will continue to expand.”

What about other nonfinancial businesses that are not involved with facilities operation, such as energy- and environment-related businesses? I spotted several such ventures on your website and in your Annual Report.

“Ah yes, we are involved in a number of energy-related businesses. For example, we wholesale and trade electric power, resulting in lower costs for both businesses and residential customers.”

Sorry, what exactly is electric power trading?

“We buy high-voltage bulk electric power from power utilities, then redistribute it as low-voltage power to retail customers, for example, condominiums. Simply by leveraging the scale of our operations we can provide lower electricity bills for end users.”

But you are just a middleman. You don’t actually produce electricity, right?

He smiled again. “Actually, we do. And that’s also where the environmental angle comes in. For example, ORIX owns a biomass power facility that burns waste wood chips to produce power. We also have a mega-solar project, that is, a large-scale solar power generation project, in Kagawa Prefecture in southern Japan. It started up quite recently, and is now generating over 2 megawatts of electricity, which we then sell to the local power utility. Of course, these are both just test cases. We are aiming to become more active in power generation, and expect to produce 300 MW of solar power within the next few years. We are installing rooftop solar panels on many ORIX-owned buildings and warehouses, and we’re scouting all over Japan for similar facilities where we might install solar power generating systems. Our goal is to help to reduce Japan’s near-total dependency on fossil and nuclear fuels.

“In addition to generating solar power ourselves, we are active in businesses connected with providing renewable energy and helping to efficiently manage energy consumption. That includes selling solar power systems and providing smart meters to help people better manage their electricity use.

“We are beginning to look into the energy business overseas, as well. For example, we have invested in a thermal power plant on the island of Panay in the Philippines. We expect to operate a power generation company and develop energy-related businesses such as electric power trading, renewable energy, and energy-saving services.”

It sounds like the image of ORIX as a leasing firm, or even as a financial services firm, is a bit out of date.

“Don’t misunderstand. These nonfinancial operations are still a very, very small part of the overall picture. But if they show promise, if they produce significant returns relative to the investments needed to start them up, then of course they will become a larger part of our total operations, and we may well develop them further overseas. ORIX won’t ever become a global energy company or anything of the sort, but these are interesting areas to expand into as a way to further diversify our business. And, because we are a latecomer to the energy game, without fossil-fueled facilities to maintain, we can build everything in an environmentally responsible way.

“Does that answer your question?”

Only too well. Time to shift strategy again.

Let’s step back. ORIX started out 50 years ago as a small Osaka leasing firm, but in a relatively short time it has grown into a huge, diversified global company. How have you accomplished that?

“First, I should point out that it’s not really so unusual. Lots of Japanese companies have tried to become global players. But to most of them, being global simply means having a lot of overseas offices, usually staffed by Japanese managers and serving Japanese corporate clients in those local markets. In fact, most Japanese companies, both manufacturers and services companies, go into overseas markets to support other Japanese companies that are already there. ORIX has always been different. We enter markets by partnering with local firms, then leverage their reputations, connections, and business knowhow to gain traction in those markets. Most of our overseas customers have always been local companies. I think it’s safe to say that we’ve faced far fewer problems overseas and experienced far fewer failures than some other large Japanese firms. I think that’s largely because we have worked closely with local people from the outset wherever we went. In that sense, we have grown quickly because we have partnered with so many good companies worldwide.”

Yes, I’ve read the PR stuff and I’ve talked to several of your overseas managers, and everyone says pretty much the same thing. But, you know, all big companies these days talk about “thinking globally and acting locally.” How important is localization really?

“I don’t know—how important is success? I believe, in fact, all of ORIX management believes, that localization is the most important key to long-term business success worldwide. That means a lot more than hiring local staff or selling to local companies; it also means working together in equal partnership with local firms, and it means hiring—and trusting—local managers. Too many Japanese businesses have been set up overseas with Tokyo proxies running their offices and reporting back to Tokyo on a daily basis. We think that’s foolish. Perhaps it made sense in 1960, but not today. You cannot do global business while sitting behind a desk in Tokyo. You have to truly go abroad, set up a local company, and delegate authority to trustworthy local partners. Yes, it’s true that we have Japanese staff in some of our overseas operations, but usually only a handful in each office, and usually not the CEO of the local company. For the most part, local power rests with local managers, and we like it that way.

“That touches on another point: Localization is not a one-way street. There are advantages to be gained from cross-cultural influences within a global group. Diversity in all shapes and forms is good for a company. Just as one example, I notice that Chinese and Korean businesspeople tend to talk fast and make quick decisions. I think a lot of Japanese managers are jealous when they see that. Our business culture is quite different, but the global trend is certainly in the direction of our Asian partners.

“I’m Japanese, but I’m certainly not a traditional Japanese manager. I like to have active discussions; I like to debate problems. When I’m discussing things with my subordinates, I sometimes get angry. I’ll say, ‘Tell me definitely yes or definitely no, but be clear!’ That’s not a very Japanese approach.”

He paused for a few seconds, then said, I think only half in jest, “People in our office aren’t always happy with my approach, and I’m sure sometimes they think that the President is a pain in the butt. That’s okay. I like people to challenge my thinking and debate my ideas. However, that’s not something normally encouraged in Japanese culture, nor in Asian culture in general. A few years ago, I met with a team of Korean managers in a hotel bar. We argued about something for two hours nonstop in both English and Japanese, and in the process we all learned some valuable things and also came to respect each other tremendously. But afterwards, one of the Koreans said to me, ‘Inoue-san, there’s no way we could talk like this at home. A younger person just doesn’t speak to an elder like that, and no one speaks to a company president like that. It just isn’t done.’ I understood immediately, of course, and I thought, ‘What a shame it has to be that way.’ In business, sometimes it’s best to break the social rules and just say what’s on your mind. I like politeness, and I enjoy the Japanese emphasis on ningen kankei (the web of human relations), but when business decisions have to be made, time really is money, and in that case, talking around a problem becomes an extra cost item.”

From Localization to Global Expansion

I was impressed by Inoue’s comments. At first he had struck me as a rather traditional Japanese executive, but as I listened, I realized that he is also able to function in a more Western mode, while still operating smoothly within his domestic organization. That allows him to be effective both in Japan, with ORIX’s vast group of companies, and overseas, with its many foreign business partners. All the more reason to return to the previous topic, I thought, and asked him to come back to the theme of localization.

“Localization is advantageous for a group such as ours because our business is so diversified. Entering a market on your own to do just one thing is possible, but expanding into other businesses requires permits and licenses and various kinds of local cooperation. Having a strong local partner makes that process easier. As you know, we have emphasized the importance of finding the right partner and supporting that partner since we first ventured into the international market four decades ago.

“As for selecting staff, we always hire lots of local staff. They are the best sources for information, which, needless to say, is a valuable competitive asset, and they often bring good business ideas as well. We listen to our local employees and look for hints about how to do business better or how to expand in these markets. This will be even more important as we enter more retail businesses abroad. ORIX began as a B2B company and most of our overseas operations are B2B, but we will gradually increase B2 C business in the coming years, in which case knowledge of local consumers will be vitally important, and increased input from our local staff will be essential.”

Where are the next big areas to develop? Everyone talks about the BRICs—ORIX has already planted its flag in Brazil, India, and China. Is Russia next on your list?

“Russia certainly looks interesting. Many other companies got into that market and we were considering it very seriously, but at the last minute we shifted our resources elsewhere. Russia may become a target for us in the future, but for right now the most attractive areas are in Latin America and the Mideast. We have some experience in South America already—decades ago we set up JVs in Brazil, Venezuela, and Chile, and all of them were well received in the local markets, but changing government regulations made them difficult to continue. Ultimately we had to close them down or sell out our stakes. I know we will reenter some of these markets soon, and we are looking seriously at Mexico as well. Much of that strategy we will leave up to our North American headquarters in Dallas.

“As for the Middle East, we have been building a network there for some time. ORIX has strong personal and business relationships with some highly influential individuals in this region, including kings, princes, and other members of the local aristocracy. We were the first Japanese financial business to set up in the region, establishing a JV in Oman back in 1994. Since then, we have expanded by partnering with excellent firms in Egypt, Saudi Arabia, the United Arab Emirates, and Kazakhstan. We expect to develop those businesses and to provide a steadily broader range of services to clients in those countries.

“In fact, our main focus in the Mideast currently involves the insurance business. We recently concluded an agreement to acquire a 25 percent stake in Medgulf (Mediterranean and Gulf Insurance and Reinsurance Company), one of the largest and most respected insurance firms in that area. Medgulf is active in Lebanon, Jordan, Bahrain, and other countries, but is particularly strong in the Kingdom of Saudi Arabia, where the government has mandated that all private companies must enroll their employees in health insurance plans. We established a leasing firm there—Saudi ORIX Leasing Company (SOLC)—in 2001, together with the International Finance Corporation (a member of the World Bank) and the Saudi Investment Bank. SOLC was the first leasing company in the Kingdom. It focuses on finance leases for factory machinery, automobiles, transportation equipment, construction equipment, and office equipment, and is becoming involved in real estate.

“We see continued growth ahead in this region, and that should produce increasing demand for the kind of financial services that we provide.”

So that’s your focus? Latin America and the Mideast? What about Africa?

“As a matter of fact, we are very interested in Africa. We believe it has tremendous long-term potential. I sent a fact-finding team to Africa just last month. But the bottom line is that Africa’s potential will take at least another decade to realize. In the meantime, we have other strategic interests to focus on.

“If you want another example, look at our operations in Mongolia.”

Mongolia? (I must have looked a bit dubious. Of course, I don’t really know anything about the Mongolian economy, but from the little I did know, it didn’t sound like a high-growth market.) The President fielded my doubts without blinking.

“Yes, we’re very serious about developing business in Mongolia. The country is blessed with substantial mining resources as well as a strong agricultural base, and average GDP growth is projected to be around 20 percent per year for at least the next five years.

“In February of 2013, we announced a commitment to a private equity fund called Mongolia Opportunities Fund and publicly stated our interest in investing in the banking sector there. A few months later, we reached a basic agreement on investing in a major Mongolian financial services holding company called TenGer Financial Group. They hold one of the largest commercial banks in Mongolia and are active in local investment banking, leasing, insurance, software development, credit services, and more. ORIX is not the only investor in TenGer, but we are confident that by partnering with this group we will be able to find new investment opportunities and also expand our business interests in that country.”

We seem to be coming back to the perpetual ORIX theme of good risks. Am I right in thinking you are looking around the world, searching for today’s good risks and trying to understand what will be good risks tomorrow?

“That sounds about right.”

My question, then, is about the nature of risk itself for a giant international group like ORIX. It seems that there is so much volatility in global markets these days, always some kind of political tension, an uprising here, an intervention there, the threat of nuclear proliferation, constant saber-rattling by big and small nations—doesn’t that increase all kinds of risk across the board? Hasn’t overall risk—the kind that can hurt your Group—increased substantially in the past decade or two?

“Interesting question.” He closed his eyes for a moment, clearly wanting to think before answering. Then he opened them again and looked right at me. “Has global risk increased? No, I don’t think so. Overall, I think risk has declined in the world compared to a couple of decades ago. We used to deal with sovereign risk in places like Indonesia, the Philippines, South Korea. . . . There was substantial foreign exchange risk, legal risks, cultural risks, and so on. Today we almost never hear about sovereign risk, which was our biggest worry and the biggest worry for many global players. The other risks? We can read them much better than before. We are in a better position to evaluate all sorts of risks. So, my answer is twofold: Global risk has actually declined in this century, and as a Group of companies, we have learned how to evaluate and manage those risks much better . . . and that understanding helps to lower our overall risk profile considerably.”

We covered a few other topics, not all related to ORIX, and I began to think we might be having that beer someday after all. I genuinely enjoyed meeting Inoue. He turned out to be an interesting, straight-talking guy, not a pompous executive or a PR-spouting company flak. In fact, I enjoyed our talk so much that I almost forgot the real focus of my mission. Almost.

Mr. Inoue. Thank you very much for taking time to meet with me and answer my questions about ORIX at home and abroad. I have thoroughly enjoyed talking to you, and I am confident that I can write an interesting book about your company. However, there is one more thing I need to do before my work is complete, and that requires your assistance.

“Of course,” he said jovially, “What can I do? I will be pleased to help you with your research in any way I can. Do you need to visit our China headquarters? Or talk to one of our area specialists? Just let me know.”

I thanked him but explained that the one thing I needed, actually the most important thing, was to talk to the chairman, the man behind the legend I had heard about throughout my travels.

Inoue looked surprised (I knew I was a little out of line to abruptly request a meeting with the chairman), and then after a moment, he stood up. My cue that the meeting was over and it was time for me to be going. Then he smiled and said, “Let me see what I can arrange. How can I get in touch with you?” Needless to say, we had already exchanged cards. I told him my Japanese keitai (cellphone) number was on my card and his office could contact me there any time. We shook hands and headed for the door. Inoue escorted me all the way out—a show of politeness I wasn’t sure I deserved. We said good-bye at the elevator and he and his staff bowed deeply as I boarded and the doors closed.

Now all I could do was wait, but as it turned out, I did not have to wait long.