Keiretsu (Japan) - Explained
What is Keiretsu?
Written by J. Mance Gordon
Updated at April 21st, 2024
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What is Keiretsu?
Keiretsu is a Japanese word referring to the modern formation of major firms in Japan. These are generally businesses that acquire stock and merge with other firms to conduct the same projects.
Prior to WWII, major firms in Japan were managed by families that were very powerful. After WWII, the United States took over Japan. It reviewed its body of laws and came up with ways through which they keep these families in control. This marked the formation of Keiretsus.
For instance, every one of the six-car firms in Japan is a member of at least one of the major six keiretsus. The same is true in the case of electronic firms in Japan.