August 23, 2025 • 14 mins
Cash isn’t the closing currency for senior hires in Japan anymore—equity is. But many recruiters and candidates remain tangled in confusion around RSUs, vesting, tax implications, and the elusive “Japan math.” Closing a search now depends not on salary alone, but your ability to explain equity in a way that feels real and compelling.
In this episode of Executive Search in Japan, we crack open the equity puzzle and walk you through how to build offers that actually get signed.
You’ll learn:
- Why the old base + bonus model is extinct in executive-level hiring by multinationals in Tokyo and Osaka.
- How to explain RSUs in plain Japanese, covering vesting schedules, cliff structures, and tax treatment—and why this clarity builds trust.
- Scripts that reduce anxiety, help candidates see value beyond cash, and confidently accept.
- Counter-offer defense tactics, with equity as sticky collateral against “golden handcuffs.”
- Relocation levers—like housing, schooling, and FX stability—that supplement equity to make packages more palatable and retainable.
Recruiters, pay attention: mastering equity isn’t optional. It separates the recruiters who watch offers fizzle at the finish line from those who close Japan’s most complex, high-reward searches with confidence.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Tessa Sourceley (00:00):
So if you've ever looked at the traditional
Japanese job market, youprobably know it for one thing.
Stability.
Chase Stratton (00:07):
Right.
For decades, the gold standard,especially for senior roles,
was a really solid base salary.
Tessa Sourceley (00:14):
Yeah.
Often topped off with a decentbonus, too.
Chase Stratton (00:16):
Exactly.
It was predictable, reliable,and, well, for a lot of people,
that was the definition of asecure career path.
Tessa Sourceley (00:24):
That model was, you know, deeply embedded.
It really shaped expectations.
Oh, completely.
Chase Stratton (00:28):
In places like Tokyo, Osaka, for multinational
companies, that cash package,that was usually more than
enough.
Tessa Sourceley (00:35):
It was how you showed a But what happens when
that gold standard starts to,you know, lose its shine a bit?
Chase Stratton (00:43):
Well, that's the interesting part, isn't it?
Tessa Sourceley (00:45):
Because that's exactly what our sources are
telling us is happening rightnow.
Chase Stratton (00:48):
Yeah.
Tessa Sourceley (00:48):
In today's executive search market over in
Japan, we're hearing cash nolonger closes senior hires.
That's that's quite astatement.
Chase Stratton (00:56):
It really is.
It signals a huge shift.
Tessa Sourceley (00:59):
The new currency, it seems, is equity,
specifically restricted stockunits or RSUs.
Chase Stratton (01:05):
And they've rapidly become the new
battleground for grabbing thattop talent.
It's a pretty profoundreevaluation of what a
competitive offer looks likenow.
Tessa Sourceley (01:15):
Companies just can't rely on the old high base
and bonus combo anymore.
Chase Stratton (01:18):
No, not if they want to win.
Tessa Sourceley (01:20):
So what does this seismic shift mean for you
listening, whether you're maybelooking at jobs in Japan or
you're an employer trying tohire?
Chase Stratton (01:28):
Or even just curious about global pay trends.
Tessa Sourceley (01:30):
Right.
Our deep dive today is reallydesigned to unpack this evolving
world.
Chase Stratton (01:36):
We want to look at why it's happening, what RSU
is actually involved.
Tessa Sourceley (01:39):
And how smart companies are using them.
The goal is really to give youa clearer picture of this new
reality in Japanesecompensation.
Chase Stratton (01:47):
So you can navigate it, you know, with more
confidence?
Tessa Sourceley (01:50):
Okay, let's dig
Chase Stratton (01:50):
in.
Tessa Sourceley (01:51):
So let's unpack this fundamental change.
We mentioned the old standardguaranteed cash.
The material we looked atreally drives that point home.
Historically, base salary andbonus were sufficient.
Chase Stratton (02:03):
Right, for those multinational offers.
Tessa Sourceley (02:05):
But now there's this really definitive
statement.
This is no longer enough.
Why?
What's driving that change sostrongly?
Chase Stratton (02:14):
It feels like a critical turning point.
And that phrase, no longerenough, it really captures it.
An other source reinforcesthis, saying more and more jobs
in Japan are offering RSUs ontop of the already generous
guaranteed salary.
Tessa Sourceley (02:29):
So it's becoming expected now, not just
a nice to have.
Chase Stratton (02:32):
Exactly.
And the main driver.
It's global competition.
Executives in Japan, especiallythe ones targeted by
multinationals.
Tessa Sourceley (02:40):
They're not just looking locally anymore.
Chase Stratton (02:42):
No, they're comparing offers against, well,
global benchmarks, much widercomparisons.
Tessa Sourceley (02:47):
Right.
OK.
And those benchmarks lookdifferent.
Chase Stratton (02:49):
Very different.
They almost always includeequity, complex vesting
schedules, you know, all sortsof things beyond just the
immediate cash.
Tessa Sourceley (02:57):
So if multinationals want to compete
globally for that talent.
Chase Stratton (03:01):
They have to align their packages.
They need to matchinternational standards or they
simply won't win that talentwar.
Tessa Sourceley (03:06):
It's fascinating.
though, how a global trend likethis still bumps up against
local cultural nuances, whichbrings us to this idea.
Our sources mention Japan math.
What exactly is that?
Is it this preference forsecurity over potential upside?
Chase Stratton (03:21):
Yeah, it's a really key distinction.
Yeah.
Japan math highlights this sortof unique cultural preference
in the Japanese market.
Tessa Sourceley (03:29):
Which is?
Chase Stratton (03:29):
A higher weight on guaranteed cash and maybe
less on long-term upsidecompared to other markets.
Tessa Sourceley (03:36):
Okay, like Silicon Valley maybe?
Chase Stratton (03:37):
Exactly.
Think of an executive there.
They might happily take a lowerbase for huge equity potential,
seeing it as the path towealth.
Tessa Sourceley (03:46):
Whereas in Japan?
Chase Stratton (03:47):
Traditionally, a Japanese candidate might place
a much higher value on thatimmediate, stable, predictable
income.
Tessa Sourceley (03:53):
So this cultural leaning makes
introducing RSUs, explainingtheir long-term value, it makes
it inherently more complex.
Chase Stratton (04:00):
Definitely.
You're basically asking someoneto shift their financial
thinking.
Tessa Sourceley (04:03):
Okay, so if RSUs are becoming critical, but
there's this cultural preferencefor stability, that implies a
pretty big knowledge gap needsfilling.
Chase Stratton (04:12):
Huge.
Tessa Sourceley (04:13):
Let's dive into decoding these RSUs for the
Japanese professional because,yeah, our sources flag this as a
major hurdle.
Chase Stratton (04:19):
Absolutely.
It's one of the biggestobstacles, honestly.
The fact that most candidateshere have never truly understood
RSUs.
Tessa Sourceley (04:25):
Or vesting schedules or the tax side of
things.
Chase Stratton (04:29):
Right.
All of that.
Yeah.
And this isn't just a smalldetail.
for recruiters, for companies,this knowledge gap, it can be
the difference between a signedoffer and a failed placement.
Tessa Sourceley (04:40):
Wow.
So it's high stakes.
It can actually derail things.
Chase Stratton (04:43):
It often does, unfortunately, even with strong
candidates.
Tessa Sourceley (04:45):
Okay.
Let's try and close that gap abit.
If I'm a professional in Japanor maybe evaluating an offer
with RSUs, what are the absolutecore concepts I need to get?
Starting with vestingschedules, how do those usually
work?
Chase Stratton (04:59):
Vesting schedules are, yeah, super
crucial.
When you get RSUs, You don'tusually own them outright on day
one.
Tessa Sourceley (05:05):
Right.
Chase Stratton (05:05):
They typically vest over time.
A common example you see islike a four years cliffs
schedule.
Tessa Sourceley (05:10):
OK, what does the cliff mean?
Chase Stratton (05:11):
So the cliff usually means you might not get
any stock until a specific date,often one year after you start.
Tessa Sourceley (05:17):
OK, nothing for the first year then.
Chase Stratton (05:19):
Potentially, yeah.
Then after that first yearcliff, the rest of the shares
vest gradually.
maybe quarterly, maybe monthly,over the next, say, three
years.
Tessa Sourceley (05:29):
And for you, the candidate, that cliff is
important because...
Chase Stratton (05:32):
Because your actual cash flow from those RSUs
won't start until year two.
That's a vital point forbudgeting if you're used to
getting, say, an annual bonusright away.
Tessa Sourceley (05:41):
It changes the rhythm of your earnings.
Chase Stratton (05:43):
Completely.
Tessa Sourceley (05:44):
Okay, and then the tax implications.
You mentioned anxiety aroundthis.
Our sources say RSUs get taxeddifferently here versus the U.S.
Can we get a bit more specific?
Chase Stratton (05:53):
Yeah, that difference is significant and
causes a lot of confusion.
The key thing in Japan is thatRSUs are typically taxed as
regular employment income whenthey vest.
Tessa Sourceley (06:02):
Not when they're granted.
No,
Chase Stratton (06:04):
when they vest.
Tessa Sourceley (06:04):
Yeah.
Chase Stratton (06:05):
So on the day your shares actually become
yours, their market value isadded to your taxable income for
that year.
Tessa Sourceley (06:11):
And taxed at your normal income tax rate.
Chase Stratton (06:13):
Exactly, at your marginal rate, which would be
quite high.
This is different from, say,the U.S., where capital gains
tax might apply later when yousell.
Tessa Sourceley (06:21):
So for the professional, this means...
Chase Stratton (06:23):
It means you need to plan for a potentially
large tax bill hitting you atthe time of vesting.
It's a critical budgetingpoint.
We'd strongly, strongly advisegetting independent tax advice
if you're looking at an RSUheavy offer in Japan.
Tessa Sourceley (06:38):
That's a really crucial distinction.
So it's clear it's not justabout offering RSUs.
It's about explaining themreally clearly.
Chase Stratton (06:44):
Absolutely.
Tessa Sourceley (06:44):
The need to demystify stock-based incumbent
interviews to reduce candidateanxiety.
That's vital, not just forrecruiters, but for anyone
looking at these offers, right?
Chase Stratton (06:55):
Precisely.
The goal has to be buildingconfidence.
If you're a candidate, you needto feel you really understand
the full value and theimplications of that RSU
package.
Tessa Sourceley (07:04):
And for the companies.
Chase Stratton (07:05):
For companies.
Tessa Sourceley (07:06):
Yeah.
Chase Stratton (07:06):
Providing clear, simple explanations, maybe even
with examples in plainJapanese, or offering financial
education sessions, that's key.
It builds trust.
Tessa Sourceley (07:14):
And make sure the candidate actually
appreciates the long-termpotential.
Chase Stratton (07:17):
Exactly.
Without that clearcommunication, even a great
offer can just just fall flatbecause of misunderstanding or
worry.
Tessa Sourceley (07:24):
So the theory makes sense, explain RSU's
clearly, but is this actuallyhappening?
Are these RSU offers reallyshowing up widely on job boards
in Japan now?
Chase Stratton (07:34):
Oh, yeah.
Let's look at some realexamples from the sources
because they show just howcommon this is becoming.
Tessa Sourceley (07:39):
Okay, good.
Let's see the evidence.
Chase Stratton (07:40):
Right.
It's sweeping across differentroles, different industries.
For example, a top leadershiprole like a Japan banking and
expansion lead at Wise in Tokyo.
Yeah.
The listing explicitly statessalary.
JPY 20M, 23M per annum plusRSU.
Yeah.
Right there.
Integrated into that top tiercompensation.
Tessa Sourceley (08:01):
All right.
So high level finance and tech.
What about more traditionalsectors?
Chase Stratton (08:04):
We see it there too.
Via Michael Page, there'slisting for a director,
regulatory affairs in Kanagawa.
Tessa Sourceley (08:10):
Healthcare related.
Chase Stratton (08:11):
Yeah.
Offering up to 25M JPY,including RSU.
So even established industrieslike healthcare are definitely
incorporating equity now.
Tessa Sourceley (08:18):
Interesting.
And it's not just C-suite orcore operational roles.
Chase Stratton (08:21):
Nope.
An HR manager job in Tokyo fora global tech-driven company
offers a competitive salarypackage, including RSUs.
Tessa Sourceley (08:28):
So crucial support functions, too.
Chase Stratton (08:31):
And it's not only the absolute top tier.
Take Datadog, their businessvalue manager APJ role in Tokyo.
The salary isn't listed, butthe benefits clearly state new
higher stock equity, RSUs, andemployees' stock purchase plan.
Tessa Sourceley (08:47):
So it's part of a broader comp strategy even
for management roles.
Chase Stratton (08:51):
Right.
And what's really striking, Ithink, is that it's not just for
execs or super specialized techroles either.
Tessa Sourceley (08:57):
Oh.
Chase Stratton (08:57):
Look at Zoom.
For a mass market salesexecutive in Tokyo base, pay $5
million, $8 million deals peryear.
The package explicitly includescommission RSUs.
Tessa Sourceley (09:07):
Meaning commissions and RSUs.
Chase Stratton (09:08):
Exactly, for a mid-market sales role.
That really drives home thatequity isn't some niche perk
anymore.
Tessa Sourceley (09:14):
It's becoming a standard piece of the puzzle
for multinationals acrossdifferent levels and functions
in Japan.
Chase Stratton (09:19):
The message is just undeniable.
Equity is, well, it's becomingthe new baseline for competitive
offers there.
Tessa Sourceley (09:25):
Okay, so with this new landscape pretty much
established, the challengeshifts, right?
It's not just offering RSUs,but making them genuinely
attractive, making them sticky.
Chase Stratton (09:34):
Especially in a market that's known for its own
retention tools, those goldenhandcuffs.
Tessa Sourceley (09:38):
Right.
So how do companies make theirRSU offers strong enough to
compete against those strongcounteroffers people might get
from their current jobs?
Chase Stratton (09:46):
That's where really strategic communication
comes in.
Japanese firms, they are goodat using those golden handcuffs,
existing comp structures,long-term benefits, maybe even
just strong social ties to keeppeople.
Tessa Sourceley (09:58):
Which leads to solid counteroffers.
Chase Stratton (10:00):
Often, yeah.
So to make an RSU offer trulyresilient, companies,
recruiters, they need to showcandidates the total comp arc
over three to five years.
Tessa Sourceley (10:10):
So looking beyond just year one.
Chase Stratton (10:12):
Way beyond.
Detailing the long term upside,the actual wealth building
potential of the equity, notjust focusing on the immediate
cash bit.
Tessa Sourceley (10:20):
It's about painting that compelling picture
of future growth that outweighsshort term gains.
Chase Stratton (10:24):
Exactly.
It's about trying to shift thatJapan math thinking from
immediate security to long termwealth creation.
Tessa Sourceley (10:31):
But beyond the direct comp, what else can make
an equity heavy offer feel moretangible, more appealing,
especially for for candidateswho still value those immediate
benefits.
Chase Stratton (10:42):
That's where these relocation levers, as our
sources call them, become supercritical.
Tessa Sourceley (10:47):
Relocation levers like what?
Chase Stratton (10:49):
Things like housing allowances, school
tuition, FX stability,especially for candidates maybe
making a big change or moving.
These perks can be realdealmakers.
Tessa Sourceley (10:59):
And they shouldn't just be add-ons.
Chase Stratton (11:01):
No.
The sources suggest they shouldbe built into the equity pitch.
So the candidate sees immediatetangible value that complements
the longer-term equity.
Tessa Sourceley (11:11):
Ah, so it addresses the immediate
financial concern.
Chase Stratton (11:13):
Right.
And that makes the equity-heavyoffer feel much more appealing
and, importantly, stickier.
The candidate sees both thatshort-term stability and the
long-term potential.
Tessa Sourceley (11:24):
It really sounds like it's not just about
the numbers then, it's aboutcrafting this whole compelling
package.
And fundamentally, it seemsbuilding trust.
Chase Stratton (11:31):
Totally.
Tessa Sourceley (11:32):
Our sources really hammer this point, the
ability to actually explainthese complex offers well.
That's what sets successfulrecruiters apart.
Chase Stratton (11:40):
And by extension, That's what empowers
you, the listener, to makeinformed choices.
Tessa Sourceley (11:45):
Precisely.
Mastering equity isn't justjargon.
It's what separates recruiterswho lose candidates at the
finish line from those who canclose Japan's most complex,
lucrative searches withconfidence.
Chase Stratton (11:57):
And for the listener.
Tessa Sourceley (11:59):
For you, whether you're the candidate
looking at these jobs or maybeyou're involved in hiring.
This really highlights howcrucial it is to not just
understand these offersyourself.
Chase Stratton (12:09):
But also be able to clearly communicate their
value and implications.
Tessa Sourceley (12:12):
Yeah.
Confidence and understandingthese offers, that's absolutely
key for making smart careermoves and for securing the best
talent.
Chase Stratton (12:19):
Wow.
What a deep dive indeed.
Okay, let's try and bring thisall together.
Tessa Sourceley (12:23):
Let's boil it down.
Chase Stratton (12:24):
Okay.
So Japan's high stakes jobmarket, especially where global
players are involved, it's seenthis massive shift.
Tessa Sourceley (12:31):
Right.
Forget the old cash is kingidea.
Chase Stratton (12:33):
RSUs are effectively the new currency for
attracting top talent now.
Tessa Sourceley (12:37):
The days when just offering a big salary and
bonus was enough, they're prettymuch over.
And this change is driven bymultinationals needing to
compete for talent on a globalstage.
Chase Stratton (12:48):
Which means a whole new level of understanding
is needed.
From job seekers, fromemployers, everyone involved.
Tessa Sourceley (12:54):
And that unique Japan math, that cultural
preference for guaranteed cash,it means just offering RSUs
isn't the whole story.
They have to be explainedreally clearly.
Their long-term value needs tobe shown.
Chase Stratton (13:08):
And often strategically boosted with other
benefits to make the offertruly competitive and
attractive.
Tessa Sourceley (13:14):
This isn't just some passing trend, is it?
It feels like it reflectsJapan's deeper integration into
the global talent economy.
Chase Stratton (13:21):
I think so.
Companies are adapting fast andcandidates need to adapt too to
navigate this more complexlandscape.
Tessa Sourceley (13:26):
Which is potentially far more rewarding
in the long
Chase Stratton (13:29):
run.
Could be, yeah.
Tessa Sourceley (13:30):
So as we wrap up, here's maybe a final
provocative thought for you, thelistener, to chew on.
What does this fundamentalshift really mean for the future
of work in Japan?
Will Japan math that deepseated preference for immediate
stability?
Will it eventually just fullyalign with global norms, moving
entirely to equity heavypackages?
Chase Stratton (13:52):
Well, we see a unique hybrid model stick
around, one that kind of blendstraditional Japanese values with
these global market demands.
Tessa Sourceley (14:01):
And how might this evolution shape career
choices, both for local Japanesetalent who might need to adjust
expectations?
Chase Stratton (14:08):
And for international professionals
looking to work there who mightactually find these compensation
structures more familiar now?
Tessa Sourceley (14:14):
Yeah.
This trend, it's really notjust about a job offer, is it?
Chase Stratton (14:18):
No, it feels bigger.
It's about Japan's deepeningconnection to the global talent
economy and what that signalsfor hiring and keeping talent in
the years ahead.
Tessa Sourceley (14:26):
Well, thank you for joining us on this Depth
Dive.
Chase Stratton (14:28):
My pleasure.
Tessa Sourceley (14:28):
We really hope this has given you some valuable
new insights into the shiftingsands of compensation over in
Japan.
Until next time, keep diggingfor knowledge.
So if you've ever looked at the traditional
Japanese job market, youprobably know it for one thing.
Stability.
Chase Stratton (00:07):
Right.
For decades, the gold standard,especially for senior roles,
was a really solid base salary.
Tessa Sourceley (00:14):
Yeah.
Often topped off with a decentbonus, too.
Chase Stratton (00:16):
Exactly.
It was predictable, reliable,and, well, for a lot of people,
that was the definition of asecure career path.
Tessa Sourceley (00:24):
That model was, you know, deeply embedded.
It really shaped expectations.
Oh, completely.
Chase Stratton (00:28):
In places like Tokyo, Osaka, for multinational
companies, that cash package,that was usually more than
enough.
Tessa Sourceley (00:35):
It was how you showed a But what happens when
that gold standard starts to,you know, lose its shine a bit?
Chase Stratton (00:43):
Well, that's the interesting part, isn't it?
Tessa Sourceley (00:45):
Because that's exactly what our sources are
telling us is happening rightnow.
Chase Stratton (00:48):
Yeah.
Tessa Sourceley (00:48):
In today's executive search market over in
Japan, we're hearing cash nolonger closes senior hires.
That's that's quite astatement.
Chase Stratton (00:56):
It really is.
It signals a huge shift.
Tessa Sourceley (00:59):
The new currency, it seems, is equity,
specifically restricted stockunits or RSUs.
Chase Stratton (01:05):
And they've rapidly become the new
battleground for grabbing thattop talent.
It's a pretty profoundreevaluation of what a
competitive offer looks likenow.
Tessa Sourceley (01:15):
Companies just can't rely on the old high base
and bonus combo anymore.
Chase Stratton (01:18):
No, not if they want to win.
Tessa Sourceley (01:20):
So what does this seismic shift mean for you
listening, whether you're maybelooking at jobs in Japan or
you're an employer trying tohire?
Chase Stratton (01:28):
Or even just curious about global pay trends.
Tessa Sourceley (01:30):
Right.
Our deep dive today is reallydesigned to unpack this evolving
world.
Chase Stratton (01:36):
We want to look at why it's happening, what RSU
is actually involved.
Tessa Sourceley (01:39):
And how smart companies are using them.
The goal is really to give youa clearer picture of this new
reality in Japanesecompensation.
Chase Stratton (01:47):
So you can navigate it, you know, with more
confidence?
Tessa Sourceley (01:50):
Okay, let's dig
Chase Stratton (01:50):
in.
Tessa Sourceley (01:51):
So let's unpack this fundamental change.
We mentioned the old standardguaranteed cash.
The material we looked atreally drives that point home.
Historically, base salary andbonus were sufficient.
Chase Stratton (02:03):
Right, for those multinational offers.
Tessa Sourceley (02:05):
But now there's this really definitive
statement.
This is no longer enough.
Why?
What's driving that change sostrongly?
Chase Stratton (02:14):
It feels like a critical turning point.
And that phrase, no longerenough, it really captures it.
An other source reinforcesthis, saying more and more jobs
in Japan are offering RSUs ontop of the already generous
guaranteed salary.
Tessa Sourceley (02:29):
So it's becoming expected now, not just
a nice to have.
Chase Stratton (02:32):
Exactly.
And the main driver.
It's global competition.
Executives in Japan, especiallythe ones targeted by
multinationals.
Tessa Sourceley (02:40):
They're not just looking locally anymore.
Chase Stratton (02:42):
No, they're comparing offers against, well,
global benchmarks, much widercomparisons.
Tessa Sourceley (02:47):
Right.
OK.
And those benchmarks lookdifferent.
Chase Stratton (02:49):
Very different.
They almost always includeequity, complex vesting
schedules, you know, all sortsof things beyond just the
immediate cash.
Tessa Sourceley (02:57):
So if multinationals want to compete
globally for that talent.
Chase Stratton (03:01):
They have to align their packages.
They need to matchinternational standards or they
simply won't win that talentwar.
Tessa Sourceley (03:06):
It's fascinating.
though, how a global trend likethis still bumps up against
local cultural nuances, whichbrings us to this idea.
Our sources mention Japan math.
What exactly is that?
Is it this preference forsecurity over potential upside?
Chase Stratton (03:21):
Yeah, it's a really key distinction.
Yeah.
Japan math highlights this sortof unique cultural preference
in the Japanese market.
Tessa Sourceley (03:29):
Which is?
Chase Stratton (03:29):
A higher weight on guaranteed cash and maybe
less on long-term upsidecompared to other markets.
Tessa Sourceley (03:36):
Okay, like Silicon Valley maybe?
Chase Stratton (03:37):
Exactly.
Think of an executive there.
They might happily take a lowerbase for huge equity potential,
seeing it as the path towealth.
Tessa Sourceley (03:46):
Whereas in Japan?
Chase Stratton (03:47):
Traditionally, a Japanese candidate might place
a much higher value on thatimmediate, stable, predictable
income.
Tessa Sourceley (03:53):
So this cultural leaning makes
introducing RSUs, explainingtheir long-term value, it makes
it inherently more complex.
Chase Stratton (04:00):
Definitely.
You're basically asking someoneto shift their financial
thinking.
Tessa Sourceley (04:03):
Okay, so if RSUs are becoming critical, but
there's this cultural preferencefor stability, that implies a
pretty big knowledge gap needsfilling.
Chase Stratton (04:12):
Huge.
Tessa Sourceley (04:13):
Let's dive into decoding these RSUs for the
Japanese professional because,yeah, our sources flag this as a
major hurdle.
Chase Stratton (04:19):
Absolutely.
It's one of the biggestobstacles, honestly.
The fact that most candidateshere have never truly understood
RSUs.
Tessa Sourceley (04:25):
Or vesting schedules or the tax side of
things.
Chase Stratton (04:29):
Right.
All of that.
Yeah.
And this isn't just a smalldetail.
for recruiters, for companies,this knowledge gap, it can be
the difference between a signedoffer and a failed placement.
Tessa Sourceley (04:40):
Wow.
So it's high stakes.
It can actually derail things.
Chase Stratton (04:43):
It often does, unfortunately, even with strong
candidates.
Tessa Sourceley (04:45):
Okay.
Let's try and close that gap abit.
If I'm a professional in Japanor maybe evaluating an offer
with RSUs, what are the absolutecore concepts I need to get?
Starting with vestingschedules, how do those usually
work?
Chase Stratton (04:59):
Vesting schedules are, yeah, super
crucial.
When you get RSUs, You don'tusually own them outright on day
one.
Tessa Sourceley (05:05):
Right.
Chase Stratton (05:05):
They typically vest over time.
A common example you see islike a four years cliffs
schedule.
Tessa Sourceley (05:10):
OK, what does the cliff mean?
Chase Stratton (05:11):
So the cliff usually means you might not get
any stock until a specific date,often one year after you start.
Tessa Sourceley (05:17):
OK, nothing for the first year then.
Chase Stratton (05:19):
Potentially, yeah.
Then after that first yearcliff, the rest of the shares
vest gradually.
maybe quarterly, maybe monthly,over the next, say, three
years.
Tessa Sourceley (05:29):
And for you, the candidate, that cliff is
important because...
Chase Stratton (05:32):
Because your actual cash flow from those RSUs
won't start until year two.
That's a vital point forbudgeting if you're used to
getting, say, an annual bonusright away.
Tessa Sourceley (05:41):
It changes the rhythm of your earnings.
Chase Stratton (05:43):
Completely.
Tessa Sourceley (05:44):
Okay, and then the tax implications.
You mentioned anxiety aroundthis.
Our sources say RSUs get taxeddifferently here versus the U.S.
Can we get a bit more specific?
Chase Stratton (05:53):
Yeah, that difference is significant and
causes a lot of confusion.
The key thing in Japan is thatRSUs are typically taxed as
regular employment income whenthey vest.
Tessa Sourceley (06:02):
Not when they're granted.
No,
Chase Stratton (06:04):
when they vest.
Tessa Sourceley (06:04):
Yeah.
Chase Stratton (06:05):
So on the day your shares actually become
yours, their market value isadded to your taxable income for
that year.
Tessa Sourceley (06:11):
And taxed at your normal income tax rate.
Chase Stratton (06:13):
Exactly, at your marginal rate, which would be
quite high.
This is different from, say,the U.S., where capital gains
tax might apply later when yousell.
Tessa Sourceley (06:21):
So for the professional, this means...
Chase Stratton (06:23):
It means you need to plan for a potentially
large tax bill hitting you atthe time of vesting.
It's a critical budgetingpoint.
We'd strongly, strongly advisegetting independent tax advice
if you're looking at an RSUheavy offer in Japan.
Tessa Sourceley (06:38):
That's a really crucial distinction.
So it's clear it's not justabout offering RSUs.
It's about explaining themreally clearly.
Chase Stratton (06:44):
Absolutely.
Tessa Sourceley (06:44):
The need to demystify stock-based incumbent
interviews to reduce candidateanxiety.
That's vital, not just forrecruiters, but for anyone
looking at these offers, right?
Chase Stratton (06:55):
Precisely.
The goal has to be buildingconfidence.
If you're a candidate, you needto feel you really understand
the full value and theimplications of that RSU
package.
Tessa Sourceley (07:04):
And for the companies.
Chase Stratton (07:05):
For companies.
Tessa Sourceley (07:06):
Yeah.
Chase Stratton (07:06):
Providing clear, simple explanations, maybe even
with examples in plainJapanese, or offering financial
education sessions, that's key.
It builds trust.
Tessa Sourceley (07:14):
And make sure the candidate actually
appreciates the long-termpotential.
Chase Stratton (07:17):
Exactly.
Without that clearcommunication, even a great
offer can just just fall flatbecause of misunderstanding or
worry.
Tessa Sourceley (07:24):
So the theory makes sense, explain RSU's
clearly, but is this actuallyhappening?
Are these RSU offers reallyshowing up widely on job boards
in Japan now?
Chase Stratton (07:34):
Oh, yeah.
Let's look at some realexamples from the sources
because they show just howcommon this is becoming.
Tessa Sourceley (07:39):
Okay, good.
Let's see the evidence.
Chase Stratton (07:40):
Right.
It's sweeping across differentroles, different industries.
For example, a top leadershiprole like a Japan banking and
expansion lead at Wise in Tokyo.
Yeah.
The listing explicitly statessalary.
JPY 20M, 23M per annum plusRSU.
Yeah.
Right there.
Integrated into that top tiercompensation.
Tessa Sourceley (08:01):
All right.
So high level finance and tech.
What about more traditionalsectors?
Chase Stratton (08:04):
We see it there too.
Via Michael Page, there'slisting for a director,
regulatory affairs in Kanagawa.
Tessa Sourceley (08:10):
Healthcare related.
Chase Stratton (08:11):
Yeah.
Offering up to 25M JPY,including RSU.
So even established industrieslike healthcare are definitely
incorporating equity now.
Tessa Sourceley (08:18):
Interesting.
And it's not just C-suite orcore operational roles.
Chase Stratton (08:21):
Nope.
An HR manager job in Tokyo fora global tech-driven company
offers a competitive salarypackage, including RSUs.
Tessa Sourceley (08:28):
So crucial support functions, too.
Chase Stratton (08:31):
And it's not only the absolute top tier.
Take Datadog, their businessvalue manager APJ role in Tokyo.
The salary isn't listed, butthe benefits clearly state new
higher stock equity, RSUs, andemployees' stock purchase plan.
Tessa Sourceley (08:47):
So it's part of a broader comp strategy even
for management roles.
Chase Stratton (08:51):
Right.
And what's really striking, Ithink, is that it's not just for
execs or super specialized techroles either.
Tessa Sourceley (08:57):
Oh.
Chase Stratton (08:57):
Look at Zoom.
For a mass market salesexecutive in Tokyo base, pay $5
million, $8 million deals peryear.
The package explicitly includescommission RSUs.
Tessa Sourceley (09:07):
Meaning commissions and RSUs.
Chase Stratton (09:08):
Exactly, for a mid-market sales role.
That really drives home thatequity isn't some niche perk
anymore.
Tessa Sourceley (09:14):
It's becoming a standard piece of the puzzle
for multinationals acrossdifferent levels and functions
in Japan.
Chase Stratton (09:19):
The message is just undeniable.
Equity is, well, it's becomingthe new baseline for competitive
offers there.
Tessa Sourceley (09:25):
Okay, so with this new landscape pretty much
established, the challengeshifts, right?
It's not just offering RSUs,but making them genuinely
attractive, making them sticky.
Chase Stratton (09:34):
Especially in a market that's known for its own
retention tools, those goldenhandcuffs.
Tessa Sourceley (09:38):
Right.
So how do companies make theirRSU offers strong enough to
compete against those strongcounteroffers people might get
from their current jobs?
Chase Stratton (09:46):
That's where really strategic communication
comes in.
Japanese firms, they are goodat using those golden handcuffs,
existing comp structures,long-term benefits, maybe even
just strong social ties to keeppeople.
Tessa Sourceley (09:58):
Which leads to solid counteroffers.
Chase Stratton (10:00):
Often, yeah.
So to make an RSU offer trulyresilient, companies,
recruiters, they need to showcandidates the total comp arc
over three to five years.
Tessa Sourceley (10:10):
So looking beyond just year one.
Chase Stratton (10:12):
Way beyond.
Detailing the long term upside,the actual wealth building
potential of the equity, notjust focusing on the immediate
cash bit.
Tessa Sourceley (10:20):
It's about painting that compelling picture
of future growth that outweighsshort term gains.
Chase Stratton (10:24):
Exactly.
It's about trying to shift thatJapan math thinking from
immediate security to long termwealth creation.
Tessa Sourceley (10:31):
But beyond the direct comp, what else can make
an equity heavy offer feel moretangible, more appealing,
especially for for candidateswho still value those immediate
benefits.
Chase Stratton (10:42):
That's where these relocation levers, as our
sources call them, become supercritical.
Tessa Sourceley (10:47):
Relocation levers like what?
Chase Stratton (10:49):
Things like housing allowances, school
tuition, FX stability,especially for candidates maybe
making a big change or moving.
These perks can be realdealmakers.
Tessa Sourceley (10:59):
And they shouldn't just be add-ons.
Chase Stratton (11:01):
No.
The sources suggest they shouldbe built into the equity pitch.
So the candidate sees immediatetangible value that complements
the longer-term equity.
Tessa Sourceley (11:11):
Ah, so it addresses the immediate
financial concern.
Chase Stratton (11:13):
Right.
And that makes the equity-heavyoffer feel much more appealing
and, importantly, stickier.
The candidate sees both thatshort-term stability and the
long-term potential.
Tessa Sourceley (11:24):
It really sounds like it's not just about
the numbers then, it's aboutcrafting this whole compelling
package.
And fundamentally, it seemsbuilding trust.
Chase Stratton (11:31):
Totally.
Tessa Sourceley (11:32):
Our sources really hammer this point, the
ability to actually explainthese complex offers well.
That's what sets successfulrecruiters apart.
Chase Stratton (11:40):
And by extension, That's what empowers
you, the listener, to makeinformed choices.
Tessa Sourceley (11:45):
Precisely.
Mastering equity isn't justjargon.
It's what separates recruiterswho lose candidates at the
finish line from those who canclose Japan's most complex,
lucrative searches withconfidence.
Chase Stratton (11:57):
And for the listener.
Tessa Sourceley (11:59):
For you, whether you're the candidate
looking at these jobs or maybeyou're involved in hiring.
This really highlights howcrucial it is to not just
understand these offersyourself.
Chase Stratton (12:09):
But also be able to clearly communicate their
value and implications.
Tessa Sourceley (12:12):
Yeah.
Confidence and understandingthese offers, that's absolutely
key for making smart careermoves and for securing the best
talent.
Chase Stratton (12:19):
Wow.
What a deep dive indeed.
Okay, let's try and bring thisall together.
Tessa Sourceley (12:23):
Let's boil it down.
Chase Stratton (12:24):
Okay.
So Japan's high stakes jobmarket, especially where global
players are involved, it's seenthis massive shift.
Tessa Sourceley (12:31):
Right.
Forget the old cash is kingidea.
Chase Stratton (12:33):
RSUs are effectively the new currency for
attracting top talent now.
Tessa Sourceley (12:37):
The days when just offering a big salary and
bonus was enough, they're prettymuch over.
And this change is driven bymultinationals needing to
compete for talent on a globalstage.
Chase Stratton (12:48):
Which means a whole new level of understanding
is needed.
From job seekers, fromemployers, everyone involved.
Tessa Sourceley (12:54):
And that unique Japan math, that cultural
preference for guaranteed cash,it means just offering RSUs
isn't the whole story.
They have to be explainedreally clearly.
Their long-term value needs tobe shown.
Chase Stratton (13:08):
And often strategically boosted with other
benefits to make the offertruly competitive and
attractive.
Tessa Sourceley (13:14):
This isn't just some passing trend, is it?
It feels like it reflectsJapan's deeper integration into
the global talent economy.
Chase Stratton (13:21):
I think so.
Companies are adapting fast andcandidates need to adapt too to
navigate this more complexlandscape.
Tessa Sourceley (13:26):
Which is potentially far more rewarding
in the long
Chase Stratton (13:29):
run.
Could be, yeah.
Tessa Sourceley (13:30):
So as we wrap up, here's maybe a final
provocative thought for you, thelistener, to chew on.
What does this fundamentalshift really mean for the future
of work in Japan?
Will Japan math that deepseated preference for immediate
stability?
Will it eventually just fullyalign with global norms, moving
entirely to equity heavypackages?
Chase Stratton (13:52):
Well, we see a unique hybrid model stick
around, one that kind of blendstraditional Japanese values with
these global market demands.
Tessa Sourceley (14:01):
And how might this evolution shape career
choices, both for local Japanesetalent who might need to adjust
expectations?
Chase Stratton (14:08):
And for international professionals
looking to work there who mightactually find these compensation
structures more familiar now?
Tessa Sourceley (14:14):
Yeah.
This trend, it's really notjust about a job offer, is it?
Chase Stratton (14:18):
No, it feels bigger.
It's about Japan's deepeningconnection to the global talent
economy and what that signalsfor hiring and keeping talent in
the years ahead.
Tessa Sourceley (14:26):
Well, thank you for joining us on this Depth
Dive.
Chase Stratton (14:28):
My pleasure.
Tessa Sourceley (14:28):
We really hope this has given you some valuable
new insights into the shiftingsands of compensation over in
Japan.
Until next time, keep diggingfor knowledge.
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