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Religions may provide functions at an individual/personal level, as well as in the society in the form of so-called ‘organized religions.’ At the individual level, religions can form the foundation of spiritual health as an important dimension of human health. This paper however argues that at the societal level, following an organized religion may function as a ‘proof of righteousness’. The paper further explains how the followers of a certain religion may use religious affiliation as a guide in making choices on complex social issues, because religion to them provides a reliable source for making the right choices; they can thus identify and be identified as the ‘righteous members’ of the society or community they live in. A certain religious affiliation can therefore be regarded as a ‘compass’ for taking a specific position in complex situations. Japanese society, however, is different in this regard; it commonly uses other ‘social’ mechanisms, but not religion, as the compass for making important decisions. Japanese society, therefore, acts as a secular society and Japanese people may thus mistakenly be assumed not to be religious. This conclusion opens the next discussion about the peculiar ‘moral values’ that characterize the Japanese and the nature of the secular ‘ethical compass’ they use. The paper argues that the ‘ethics’ of Japanese society is closely linked to its collective culture, and describes some of the contemporary issues that can be explained through this perspective.