From an interview with the author: https://www.weforum.org/stories/2022/09/young-global-leaders...
I do find it quite unusual that he would not be allowed to naturalize after living all his life here and being married to a Japanese citizen, so perhaps there are other exceptional circumstances. Or perhaps his statelessness isn't something he is actively trying to resolve, having found ways to work around it when he needs to travel and do other things.
I know someone who tried to start the naturalization process but was instantly shot down for his Japanese skill (he speaks Japanese well). I know others who have lived in Japan for decades but cannot apply for permanent residency because they only receive short visas, making them ineligible.
Immigration officers have ultimate discretion and will not explain themselves to applicants. I assume this is by design so that particular 'standards' can be subtly applied without being reflected in statistics or receiving any criticism.