2 What might make the culture difficult to change? Nomura, Japan’s largest investment bank, acquired Lehman’s Asian, European and Middle Eastern operations in 2008. Some senior ex-Lehman employees left the company soon afterwards. A number of insiders have been reported as saying that there was a high level of frustration on both sides because of communication problems and the clash of two different cultures.

However, Nomura has been making a determined effort to transform its old culture, which is one based on Japanese customs of lifetime employment, where company loyalty is strong, decision- making is slow and tolerance of risk is low. For those coming from the outside, particularly from a western bank such as Lehman, where people were hired and fired and risk- taking were normal aspects of occupational life and, in fact, commended, such a culture is shocking, as one former Nomura manager said.

Who were the driving forces behind the acquisition and integration of Nomura and Lehman? Apparently they were senior Nomura managers with global experience/ perspectives who felt they must change the culture in order to be globally competitive, ironically at a time of financial crisis when the culture of western investment banks was being criticised for exalting individual achievement and rewarding risktaking.

However, the instigators of cultural change at Nomura have been quoted as saying that the company must embrace that culture in order to succeed globally.

As it is Nomura’s ambition to expand overseas, the inevitable consequence is that it must conform to global standards in key activities ranging from the language staff use to pay and career development in order to attract the calibre of employee it needs. In a sense the acquisition of Lehman was a catalyst for Nomura to bring about cultural transformation.

The fact that many former Lehman bankers – US and European nationals – have been put in key positions previously occupied by Japanese staff is a clear sign that capability or merit, rather than seniority, has been crucial in allocating important jobs. It is evident that seniority- based pay is losing ground. Friction has been caused because of the emphasis on compensation by former Lehman employees. Finally, a downside for Nomura is that the cultural revolution will adversely affect morale among the Japanese staff, while failing to ensure the talented Lehman people remain

( Nakamoto, 2009 )