Sustainable Investment Survey
Japan Sustainable Investment Forum2018

Japan Sustainable Investment Forum (JSIF)About the Organization
NPO Japan Sustainable Investment Forum (JSIF) works to promote Sustainable and Responsible
Investment (SRI) in Japan. JSIF was established in 2001 to proliferate the concept throughout
Japan and acquired NPO status in 2004. The organization changed its name in 2016 (previously,Socially Responsible Investment Forum).

Sustainable Investment Survey 2018
Published: March 31, 2019 (Japanese Version)
August 30, 2019 (English Version)
NPO Japan Sustainable Investment Forum (JSIF)

JSIF Premium Corporate Members
Arabesque Asset Management Ltd.
Asset Management One Co., Ltd.
AXA Investment Managers

Shirokanedai Bldg., 5th Floor,
19-6, Shirokanedai 3-chome, Minato-ku,
Tokyo 108-0071, Japan

Comgest Asset Management Japan Ltd.
Cre-en Inc.

E-mail: jsif.jp.net@gmail.com

Ernst & Young ShinNihon LLC

URL: japansif.com/english

GPSS Holdings Inc.

DISCLAIMER
The information contained in this document is offered solely for informational purposes. It is provided neither to promote securities transactions nor to recommend
any securities investments. We offer no guarantees regarding the accuracy orcompleteness of any information presented, which may change without notice.
Although the utmost effort was made to ensure the accuracy of information andfigures in this report, we assume no responsibility for any damages arising directly
or indirectly from errors and omissions, or from any decisions or actions taken
based on this information.
COPYRIGHT
All rights relating to this document are reserved by Japan Sustainable Investment
Forum (JSIF). No part of this report may be reproduced, copied, or distributed inany form without prior consent from JSIF.

Integrex Inc.
KPMG AZSA Sustainability Co., Ltd.
Nissay Asset Management Corporation
NN Investment Partners (Japan) Co., Ltd.
Sompo Risk Management Inc.
Sumitomo Mitsui Trust Asset Management Co., Ltd.

Copyright ©2019 by Japan Sustainable Investment ForumSustainable Investment as Defined by JSIFIn the past, JSIF defined “sustainable investments” as investments that embody the following two principles:
1. Investments with a view to the sustainability of the earth and society
2. Investments supported by the disclosure of initiatives pertaining to Principle 1 and the social effects of these investments
on suppliers of capital
However, when conducting the 2018 survey, some institutional investors requested that JSIF reexamine its definition of sustainable investment. Given the nature of the investments in question, the JSIF definition caused confusion among respondents. The JSIF Steering Committee deliberated and decided to adjust the definition of sustainable investment in the survey
to resemble that of the Global Sustainable Investment Review (GSIR) and the Principles for Responsible Investment (PRI). We
made this adjustment to more accurately reflect the development of sustainable investment in Japan, which is, in essence,
the goal of our survey. The definition is as follows:“Sustainable investment is investment that considers environmental, social, and governance (ESG) factors in theinvestment analysis and investment portfolio decision-making process while taking into account the sustainability of
the investment.”
With that said, many institutions that previously provided us with answers did not find any issues with our initial definition forsustainable investment. Accordingly, the survey results represent the replies from the institutions that answered based on thesurvey’s initial definition of sustainable investment and those that answered based on the new definition explained above.

1

Review of Results of the JSIF Fourth Sustainable
Investment Survey
1 Japan’s Total Sustainable Investment Balance atApproximately ¥232.0 Trillion

nature of assets. We believe it is critical to promote correctunderstanding of ESG investment across a greater number

The total sustainable investment balance in 2018 forof related parties in order to gain more respondents. The

domestically headquartered institutional investors rose to

second problem involves the inability to request responses¥231,952.25 billion, an increase of 1.7 times from the previ-from numerous institutional investors. JSIF is limited to pub-ous survey.

licly available e-mail addresses that have been directly
obtained. As of December 14, 2018, there were roughly 230

When carrying out this year’s survey, JSIF sent e-mails to

institutional investors—including trust banks, investment

institutions with which it maintains contact to request theirtrusts, investment management companies, life and casu-

cooperation with the review. JSIF additionally solicited thealty insurance companies, and pension funds—that havecollaboration of PRI signatory institutions with locations indeclared their acceptance of the Stewardship Code. JSIF

Japan to spread awareness of the survey. Of the 42 institu-

considers these institutional investors to be potential

tions that JSIF asked to take the survey, 40 provided

respondents. However, most institutional investors do notresponses concerning their sustainable investment bal-

disclose their e-mail addresses on the Internet. Furthermore,ances. For the two remaining institutions, JSIF referenced

while several members of JSIF maintain good relations withpublicly disclosed information and calculated totals based

these institutional investors, the Act on the Protection of

on this information. These results will also be reflected in

Personal Information prevents the use of contact information

Global Sustainable Investment Review 2018, which is

obtained this way.

scheduled to take place in March 2019. The review aggregates global sustainable investment balances and is a col-We want to ask those interested in this report to reach out

laboration among Sustainable Investment Forums (SIFs)

to institutions that have not responded to our survey so thataround the world. The report is published every two years.

they may respond in the following years. We also hope that

The results of this survey and the accompanying comments

people who read this report and belong to Stewardshipby JSIF are reflected and published in the review, to be

Code signatory institutions encourage those in charge towidely used by public organizations and survey companies

respond to the survey.

in and outside Japan.
Despite these issues, several institutional investors haveactively responded, even without direct action from JSIF,

2 Methods for Producing This Survey and Relevant
Issueswith the number of respondents increasing from 32 for theprevious survey to 42 for this edition. Although the number

We received a wide range of feedback regarding the previ-of respondents were limited, we received responses fromous survey. Many inquired whether the number of sustain-

nearly all of the PRI signatory institutions in Japan. We con-able investment assets held by Japanese institutional

clude that the aggregate values presented here come close

investors was higher than the aggregate amounts reported

to the actual amount, given that the PRI signatory institu-

by JSIF. In response to this, JSIF reevaluated its tabulation

tions are considered to be the ones making earnest efforts

methods before delivering the survey. For this survey, JSIF

toward ESG investment.

adopted this estimation and calculation method for two
institutions that did not respond by using their detailed,

JSIF offers an annual opportunity to explain the details of

publicly disclosed information. Furthermore, JSIF revised its

the survey results to the institutions who reply to the survey.

definition of “sustainable investment” after exchanging views

We hope that a large number of institutions participate andwith institutional investors as explained on the first page ofoffer us their opinions.

this document.
One of our challenges for the future is increasing thenumber of respondents in the survey. However, this issue
contains within it two problems. First, as highlighted above,
there are a variety of constraints regarding inquiries into the23 Factors Behind the Sustainable Investment
Balance Increase

investment worldwide but has not seen the same prevalence in Japan. As a result, the 21.1% increase shown in

The total sustainable investment balance calculated from thethis survey is a point of particular interest, despite the low

2018 survey is approximately ¥232.0 trillion, up 69.8% frommonetary amount. We want to explore whether this increase

the 2017 survey balance of nearly ¥137.0 trillion and up

was the result of a growing awareness of, and the recent

312.3% from the 2016 survey balance of roughly ¥56.0 trillion.

focus on, divestment (the disposition of assets under management via sale) or the result of other factors.

One major factor for this year-on-year increase was that the
number of respondent institutions increased from 32 to 42;

In terms of sustainable investment by asset class, Japanese

another major factor was our adoption of the calculatedshares and foreign shares further cemented their status asestimates. However, based on only those institutions thatthe primary asset classes for sustainable investment withreplied in 2017, the investment balance increased by 9.6%.

increases of 130.8% and 152.7%, respectively. Also notable

In light of this, not only can we conclude that the number ofis a 192.1% increase in loans, bringing the balance to theinstitutions engaged in sustainable investment is expanding¥10.0 trillion level. New respondents had a limited impact on

but we can also ascertain that the institutions alreadythese results, with the majority of the increase coming fromengaged are doing so to a higher degree.

financial institutions that were repeated respondents from2017. Combined with a 57.9% growth in bonds, a 48.0%

Looking at investment balance by investment strategy, ESG

growth in private equity (PE) and a 73.9% growth in real

integration showed the most significant increase, up

estate suggest that the scope of sustainable investment is

182.8% from the previous fiscal year, while engagement

starting to expand into loans and these other fields.

increased 59.9% as well.
Investment in exercising voting rights was ¥132.0 trillion, up

4 Future Issues and Outlook

140% year on year. We separated this category from

However, looking globally, responsible investment isengagement in 2016. However, it has been confirmed that inexpanding into an even wider array of asset types. The PRI

2017 some respondents did not make this distinction, which

recommends that signatory institutions engage in active

led to low numbers in the 2017 survey. Therefore, this had aownership of the following assets (values in parentheses

certain level of impact on the high increase we saw in therefer to responsible investment activity coverage of the sig-

results of this survey. In theory, institutional investors exer-

natory institutions): listed stocks (99%), bonds (91%), pri-cise their voting rights for all of their investee companies,

vate equity (92%), real estate (90%), infrastructure (93%),

but looking at investment balance by asset class, Japanesecommodities (50%), hedge funds (64%), forests (93%), agri-

shares showed a balance of ¥137.0 trillion while foreign sharescultural land (95%), inclusive finance (100%), and cash

showed a balance of ¥80.0 trillion. In the future, we intend(41%). The values in parentheses are of particular impor-

to investigate the reason for this disparity in these totals.

tance. While Japan is making rapid progress, these figures
bring to light issues such as the expansion of the range of

Positive/best-in-class screening decreased 4.0% year on

sustainability themes as well as the increase in the field ofyear, which is a point of considerable interest when con-assets. We hope that Japan will attain a global presence intrasted with the 21.1% increase in negative screening.

these aspects as well.

Positive screening is a well-known aspect of responsible
investment indices, and companies tend to attach signifi-

One more critical issue is ESG investment education. In

cance to being constituents of these indices. In this light,

Japan, the impacts of the Stewardship Code, Corporate

one would assume investors would take great advantage ofGovernance Code, and the Ito Review, as well as the com-

responsible investment indices, but in actuality, use is lim-

prehensive efforts of the Government Pension Investment

ited in Japan and overseas. Many company IR and CSR offi-

Fund (GPIF), have resulted in many institutional investors

cers tend not to take notice of this point. On the other hand,and financial institutions developing ESG investment sys-

negative screening, which has been used since the 1920s,

tems. However, some have expressed concerns that theis the most widely used asset management method for ESG

trend of ESG investment will conclude as nothing more than3

a temporary boom. While we do not believe this trend will

Water, Heritage and the Arts, the Environment Protection

finish as a boom, we think it is possible that institutions are

Authority Victoria, and the New South Wales Office ofsettling for superficial efforts not conducive to systems.

Environment & Heritage.

Looking at company CSR and CSV initiatives, one issue isthe difficulty in accumulating knowledge and expertise, due

The spread of ESG investment has spawned issues as well.

to the relatively short-term assignment length of supervisory

These issues concern sustainable investment by investment

staff and the succession of supervisors with little expertise

trusts as aggregated by JSIF. To date, we could base ourin the field. In comparison, although fund managers andconclusions on the information in fund names, prospec-

analysts at asset management companies tend to stay intuses, sales materials, and other disclosed materials.

one department for a relatively long time, these organiza-

Currently, however, several management companies classify

tions inevitably have difficulty in accumulating information.

ESG initiatives under “research.” This means that even when

As a result of this, in tandem with the rapid growth of ESG

there is no mention of ESG in a prospectus or related mate-investment, people who possess the appropriate back-rials for a fund, that fund may still be classified as an ESG

ground knowledge combined with a grasp of underlying

investment fund. We believe that the full nature of a new

assumptions are likely to be few.

fund should be stated in the prospectus, but, practicallyspeaking, it is difficult to make changes to the articles of

Therefore, at JSIF, we believe that Japan has entered aexisting funds. As a result, it is difficult for individual inves-period in which a comprehensive sustainable investment

tors to judge the extent to which ESG is reflected inand ESG investment training program is necessary. Several

research and management. Considering these circum-

members of JSIF have been working in these fields for many

stances, we believe an evaluation of the ESG integration foryears. JSIF is also gaining experience on the educational

each fund will be necessary for the near future. JSIF is

side. Previously, members of JSIF have been given theinvestigating the possibilities for this evaluation based on theopportunity to give lectures under professors at the Waseda

information it has gained through collaboration with its

University Graduate School of Finance, Accounting andglobal partners.

Law. Since 2017, we have been holding classes at the
Waseda Business School (Graduate School of Business andGlobal Sustainable Investment Review 2018 will be pre-Finance). JSIF would like to take advantage of the uniquesented in March of this year. While it seems that sustainable

position to provide a program, such as the one mentioned

investment balances are increasing overseas, the scale ofabove, that caters to the current conditions in Japan andJapan’s aggregate balance firmly places the country as aalso reflects global standards. Our first course of action,

global player. Putting this assumption into a better perspec-with the much appreciated support of the Ministry of thetive, we have received active feedback and cooperation from

Environment, is to translate the PRI’s PRI Academy program

public institutions and government agencies for this survey—

into Japanese. The program is based on a program devel-

for which we are incredibly thankful. Their shared opinion isoped by the SIF in Australia, with SIFs in Australia andthat Japan’s degree of sustainable investment is more signifi-

Canada currently acting as global training partners. JSIF willcant than this level and that the figures should more accu-

add its name to this list. Moreover, the London Stockrately reflect this reality. Furthermore, they firmly believe that

Exchange is working jointly with the CFA Institute to utilize

the actual conditions should be explained to those overseas.

the PRI Academy program. The CFA Institute provides thoseIn and of themselves, these opinions show that Japan’s ven-

who complete its program with continuing education cred-ture into sustainable investment is in full swing.

its. JSIF plans to work with finance-related associations in

4Japan interested in the ESG education program. We hope it

Since the founding of JSIF in 2001, its goal has been towill be used by fund managers and analysts, sales staff ofcapture the same positive enthusiasm toward sustainablefinancial products, financial planners, and pension fundinvestment that existed in Europe and the U.S. and popular-

trustees. Furthermore, the Ministry of the Environment ofize it in Japan. However, considering the expansion that has

Japan will be added to the list of funding supporters of thetaken place in the last two to three years, we realize the

PRI Academy, which includes the Australian Department oftime has come to raise the bar past popularization to some-the Treasury, the Australian Department of the Environment,thing greater. In this light, we have been trying to strengthen

our global ties over the past one to two years. In March
2018, we, along with the SIF in Canada, formally joined the
Global Sustainable Investment Alliance (GSIA), a worldwide
alliance of NPOs and NGOs similar to JSIF. The GSIA has
aggregated a global sustainable investment balance andpresented that balance in the GSIR once every two years
since 2014. Since the beginning of this practice, JSIF has
been in charge of tallying the Japanese portion of the total.
As an official member of the GSIA, JSIF participates in a
conference call with SIF representatives of their respective
countries every three months. In addition, JSIF takes part inregular meetings with PRI representatives. As a result, weare now able to exchange opinions on global efforts andcommunicate Japan-related information to these parties.
Until now, JSIF has also maintained ties with global organizations such as the PRI, the Carbon Disclosure Project(CDP), the Natural Capital Finance Alliance, and the
2°Investing Initiative. However, as we go forward, we arealso planning to strengthen our ties with overseas SIFs andmake further progress with our global efforts. Also, we havebeen exchanging opinions with the Ministry of theEnvironment, the Financial Services Agency, and theMinistry of Economy, Trade and Industry for many years andparticipating in committees sponsored by them. Over the
past two years, we believe our relationships with these institutions have deepened even further. One benefit of these
relationships has been the decision by the Ministry of theEnvironment to support the development of our ESG investment education program.
In closing, we are very thankful to the PRI Japan Networkand other entities for their considerable support in creating
this report. We would also like to thank EDGE International
for its kind and continued cooperation toward editing,designing, and creating the English-language publication.
In the future, we hope to create a survey that will encouragea higher number of pension funds and institutional investors
to respond. This, in turn, will lead to complete analysis in
future editions.
January 2019
Masaru Arai, Chair
NPO Japan Sustainable Investment Forum (JSIF)

5

Survey Distribution Methods
JSIF e-mailed survey requests to institutions for which con-•M
 S&AD Insurance Group Holdings, Inc.

tact information could be verified. The PRI Japan Network•M U Investments Co., Ltd.

also assisted with distribution to domestic PRI signatories.

•N ippon Life Insurance Company

Forty-two institutions responded; among them, 40 institu-•N issay Asset Management Corporation

tions responded to the questions regarding sustainable•N N Investment Partners (Japan) Co., Ltd.

investment.

•N omura Asset Management Co., Ltd.

For the remaining two institutions, JSIF estimated figures•N omura Real Estate Asset Management Co., Ltd.

based on publicly available information. Therefore, the total•P ension Fund Association

number of respondents is 42 institutions (40 respondents,•P rologis REIT Management K.K.

two estimates).

•R esona Bank, Limited•R
 J Investment Co., Ltd.

List of Survey Respondents (in Alphabetical Order)•S ecom Pension Fund

Forty companies responded to the survey, two of which•S ompo Japan Nipponkoa Asset Management Co., Ltd.

chose to remain anonymous. The remaining 38 companies•S ompo Japan Nipponkoa Insurance Inc.

are listed below:•S ophia University•S PARX Asset Management Co., Ltd.

• AD Investment Management Co., Ltd.

•S
 umitomo Mitsui Asset Management Co., Ltd.

• Amundi Japan Ltd.

•S
 umitomo Mitsui Trust Asset Management Co., Ltd.

• Asahi Life Asset Management Co., Ltd.

•T aiyo Life Insurance Company• Asset Management One Co., Ltd.

•T
 &D Asset Management Co., Ltd.

• Comgest Asset Management Japan Ltd.

•T
 okio Marine Asset Management Co., Ltd.

• Daido Life Insurance Company•T okio Marine & Nichido Fire Insurance Co., Ltd.

• The Dai-ichi Life Insurance Company, Limited• Daiwa Asset Management Co. Ltd.
• DBJ Asset Management Co., Ltd.
• Fukoku Capital Management, Inc.
• Japan Post Insurance Co., Ltd.
• Japan REIT Advisors Co. Ltd.
• J-STAR Co., Ltd.
• Mitsubishi UFJ Kokusai Asset Management Co., Ltd.
• Mitsubishi UFJ Trust and Banking Corporation• Mizuho Trust & Banking Co., Ltd.

6

Previous Results
Overview
2016

Total Sustainable Investment Balance (in millions of yen)

2017

2018

56,256,600

136,595,941

31

32

42

16.8%

35.0%

41.7%

Number of Respondents
Percentage of Total Assets under Management

Sustainable Investment Balance by Investment Management Method231,952,250(Unit: millions of yen)
2016

2017

2018

ESG Integration

14,240,387

42,966,133

121,511,832

Positive/Best-in-Class Screening

3,020,214

6,693,443

6,425,278

Sustainability-Oriented Investment

1,036,139

1,384,773

Impact and Community Investment

369,657

372,616

Exercising Voting Rights
Engagement

34,890,329

2,014,546

55,007,706

132,034,774

88,037,433

140,754,582

Negative Screening

2,249,951

14,309,760

17,328,216

Norms-Based Screening

6,741,902

23,908,999

31,604,106

Total

62,548,579

232,680,863

451,673,334

Sustainable Investment Balance by Asset Class(Unit: millions of yen)
2016

2017

2018

Japanese Stocks

31,194,049

59,523,773

137,385,115

Non-Japanese Stocks

4,564,386

31,842,726

80,482,008

Bonds

6,846,696

18,301,518

28,891,704

Private Equity (PE)39,836

190,443

281,901

Real Estate

406,0432,666,410

4,637,032

3,504,432

10,236,320

4,759,604

4,718,818

Loans
Other

3,197,093

Note: In calculating the sustainable investment balance for the 2018 survey, duplication was avoided as much as possible by deducting pension fund trust amounts from theamounts supplied by asset management companies. However, since we did not ask for information regarding sustainable investment balance by investment management method and asset class, we are not able to distinguish between the trust amounts of asset management companies and those of pension funds. Consequently,
the sustainable investment balance contains duplication of these two amounts. Additionally, duplicate figures arise due to multiple answers about investment method.

7

Survey Results
Survey questions can be found at:• In other responses, initiatives mentioned by two or more

http://japansif.com/JSIFsurvey2018qa.pdf

institutions were the United Nations Global Compact(three institutions) and the Asian Corporate Governance

Q1

This question has been omitted because it is not
relevant to the survey results.

Association (three institutions).


Q4



Q2

Please describe your role pertaining to capitalmanagement and capital structure.

Number of institutions that answered this question

Number of institutions that answered this question

44 

Choices

2017

2018

Asset Owner

8

12Investment Manager

24

31

Asset Owner and Investment Manager(both apply)

2

1

43 

Choices

2017

2018

YES

29

35

NO

5

8



Q5

About the survey:

Do you have a formal policy on sustainable investment (ESG investment, responsible investment, etc.)
specific to your organization?

The total number of respondent institutions was 42. Of these,

Number of institutions that answered this question

40 institutions responded on investment balances. Of the two

Choices

2017

2018

YES

29

34

NO (currently in development)1

1

NO (intention to discuss policy development)

3

4

NO (no plan for policy development)

11

institutions that did not reply, one was making preparations
for sustainable investment while the other was engaged insustainable investment but did not provide any details on its
investment balance. Additionally, JSIF calculated the investment balance in respect of two asset owners based on pubincluded in this survey on investment balance is 42.

Q6

Which of the following initiatives have you adopted
or are involved in?

Number of institutions that answered this question

This is a question for institutions that answered“YES” to Q5. Is that policy publicly disclosed?

Number of institutions that answered this question



Q3

39 

Choices

2017

2018

Principles for Responsible Investment (PRI)31

35

Equator Principles

1

1

Principles for Financial Action for the 21stCentury (PFA21)

15

17

Principles for Sustainable Insurance (PSI)

3

3

Carbon Disclosure Project (CDP)

1013

ICGN (The International Corporate
Governance Network)

8

Montreal Carbon Pledge

2

40 



licly available data. Therefore, the number of institutions

34 

Choices

2017

2018

YES (disclosed to the public)

26

29

YES (disclosed only to clients and subscribers)

2

4

NO

1

1



Q7

Are you engaged in sustainable investment (ESG
investment, responsible investment, etc.)?

Number of institutions that answered this question

44 

Choices

2017

2018

YES

33

43

7

NO (currently making preparations)

0

1

3

NO (intention to discuss implementation)

10

NO (no plan for implementation)

00

United Nations Environment Programme –Finance Initiative (UNEP FI)

0

6

Other (please specify)

1116•	T he Montreal Carbon Pledge and the UNEP FI are newly
set choices for 2018. Figures for 2017 were calculated
based on information in the “other” category.



Q8

Are you able to disclose to us your sustainable
investment balance under management?

Number of institutions that answered this question

43 

Choices

2017

2018

• Thirty-five institutions were signatories of the PRI, which pro-

YES

32

40

motes ESG investment internationally, making it the initiative

NO

1

3

with the most signatories; 17 institutions were engaged in
the corresponding domestic initiative, PFA21; and signatories
of CDP, which advocates disclosure of corporate initiatives
pertaining to CO2 emissions, water, and forests, totaled 13.

8

Have you declared adoption of Japan’s
Stewardship Code?

•	Of the three institutions that answered in the negative,
JSIF added sustainable investment balance data for two
institutions based on publicly available information.

periods and amounts that fall outside the period endedQ9

Q9–Q13 are on sustainable investment balances.

March 31, 2018. The breakdown is as follows:




2017

Total Sustainable Investment Balance(in millions of yen)

136,595,941

Number of Respondents
Percentage of Total Assets underManagement(Unit: millions of yen)

End of July 20172018

End of March 2018

231,952,250

32

42

35.0%

41.7%

910,000(¥ Million)

190,031,967

End of May 2018

1,168,947

End of June 2018

39,340,818

End of July 2018446,378

End of August 201812,304End of September 201841,836

Total
231,952,250

2018

231,952,250

If permitted, please tell us the proportion of the136,595,941

2017
0

50,000,000

100,000,000

Q14 amount indicated in Q9 allocated to each of the

Increase of
1.7 times
150,000,000

200,000,000

asset management methods listed below (multiple
responses permitted).

250,000,000

Number of institutions that answered this question
Choices39 (Unit: millions of yen)

2017

2018

% Changea ESG Integration

42,966,133

121,511,832

182.8%The total sustainable investment balance of the 42 institu-

Positive/Best-in-Classb
Screening

6,693,443

6,425,278–4.0%

tions was ¥310,686,784,000,000. The two amounts listedcSustainability-Themed
Investment

1,384,773
14.6%

dImpact and Community
Investment

2,014,546

possible, duplication of the sustainable investment balance

372,616

amounts of asset management companies and asset owners.

e Exercising Voting Rights

55,007,706

132,034,774

140.0%f Engagement

88,037,433

140,754,582

59.9%

g Negative Screening

14,309,760

17,328,216

21.1%

23,908,999

31,604,106

32.2%

232,680,863

451,673,334

Method for calculating sustainable investment balance

below were subtracted from that total to avoid, as much as

	The investment balance declared to have been entrusted
to other responding institutions was¥12,700,000,000,000.
	Of asset management companies’ sustainable invest-h Norms-Based Screening
Total(¥ Million)

ment balance, the trust amount from pension funds was¥66,034,534,000,000.
Method for calculating sustainable investment balance asa percentage of total assets under management
In response to Q11, 42 institutions listed their total asset

160,000,000
120,000,000
80,000,000
40,000,000

balance under management as ¥709,001,744,000,000.
Balance information was supplied by 40 institutions and

0

a

b

c+d

e

f

g

h

estimated for two institutions. The sustainable investment
balance for those same 42 institutions was‌2017

2018¥295,855,784,000,000. Sustainable investment as a percentage of total assets under management was computed
via the following calculation: ¥295,855,784,000,000 /¥709,001,744,000,000 x 100 = 41.7%.
Data collection period
While we requested responses for the period ended March2018 as a general rule, we also accepted responses forother periods. Sustainable investment balances for those

Note: In calculating the sustainable investment balance for the 2018 survey, duplication was avoided as much as possible by deducting pension fund trust
amounts from the amounts supplied by asset management companies.
However, since we did not ask for information regarding sustainable investment balance by investment management method, we are not able to distinguish between the trust amounts of asset management companies and thoseof pension funds. Consequently, the sustainable investment balance contains
duplication of these two amounts. In addition, the figures do not match thesustainable investment balance total of ¥232 trillion, due to factors such as
multiple responses being received where two or more investment management methods are used and because some institutions did not respond to
this question.

periods are included in the total. In Q10, we asked for those9Definitions of Investment Management Methods

Exercising Voting Rights

Definitions have been partially modified by JSIF based on

		Exercising voting rights

GSIA calculation methods to reflect the current situation in		 * Not limited to exercising voting rights regarding ESG

Japan better.

		 * May include judgments on the exercising of voting rights entrusted to voting
advisory companies

ESG Integration
		The investment that systematically incorporates ESG(environmental, social, and corporate governance) factors
into regular management processes. Examples include
ESG evaluation, screening, and due diligence prior toinvestment, and monitoring and engagement afterinvestment
Positive/Best-in-Class Screening		Investment in selected sectors and corporations throughESG screening

Engagement		Constructive dialogue with corporations as a shareholder
based on engagement policies
Negative Screening
		Abstention from investment in specific industries or corporations based on ethical, social, or environmental reasons* Not relevant where abstention from the investment is based on a poor ESG
ratingNorms-Based Screening		Investment based on standards set by international orga-

Sustainability-Themed Investment

nizations (OECD, ILO, UNICEF, etc.). For example,•	Equity investments: investments that reflect sustainability

abstention from investment in corporations affiliated withthemes, including renewable energy, environmental tech-cluster munitions based on the Oslo Convention

nology, agriculture, empowerment of women, and theSDGs•	The largest number of institutional initiatives were related•	Bond investments: investments with a focus on sustain-

to ESG integration (31 institutions), followed by exercisingability themes and that highlight impact on society (e.g.,

voting rights (26 institutions), and engagement (25green bonds, vaccine bonds, etc.)

institutions).

•	Other assets: sustainability-themed investments other•A question on impact and community investment, whichthan stock and bond investments (e.g., community

was included in surveys until 2017, has been integrated

investment)

into the question on sustainability-themed investment.
That question was then divided into three separate categories, namely, equity investments, bond investments, andother assets. The respective amounts are detailed below.
–> Equity investments: ¥378,517,000,000–> Bond investments: ¥813,038,000,000–> Other assets: ¥822,991,000,000

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



Q15

 or institutions that provided an investment
Famount for negative screening in Q14, if permitted,
please disclose the criteria being applied.

Number of institutions that answered this question

Q17

If permitted, please provide the breakdown in asset
classes for the figure provided in Q9.

Number of institutions that answered this question

9

Choices38 (Unit: millions of yen)

2017

2018

Respondents provided the following as specific exclusionaJapanese Stocks

59,523,773

137,385,115

130.8%

criteria.

b

Non-Japanese Stocks

31,842,726

80,482,008

152.7%• Corporations associated with antisocial forces

c

Bonds

18,301,518

28,891,704

57.9%

d

Private Equity (PE)

190,443

281,90148.0%

eReal Estate

2,666,410

4,637,032

73.9%

f

Loans

3,504,432

10,236,320

192.1%gOther

4,759,604

4,718,818

–0.9%

Total

120,788,906

266,632,898• Countries that violate the basic human rights of their citizens• Corporations engaged in the production or sale ofweapons or munitions• Corporations that violate the United Nations Global
Compact• Corporations involved in industries thought to have anegative impact on public health, such as the tobacco
industry• Corporations involved in trade in endangered wildlife inviolation of the Washington Convention• Corporations engaged in the production or sale of globally
unauthorized pesticides or herbicides• Corporations offering adult entertainment, such as illegal% Change

Note: In calculating the sustainable investment balance for the 2018 survey, duplication was avoided as much as possible by deducting pension fund trust
amounts from the amounts supplied by asset management companies.
However, since we did not ask for information regarding sustainable investment balance by asset class, we are not able to distinguish between the trust
amounts of asset management companies and those of pension funds.
Consequently, the sustainable investment balance contains duplication ofthese two amounts. In addition, the figures do not match the sustainable
investment balance total of ¥232 trillion because some institutions did not
respond to this question.
(¥ Million)
160,000,000

gambling and casinos
120,000,000



80,000,000

Q16 or institutions that provided an investment
Famount for norms-based screening in Q14, if permitted, please disclose the norms being applied.

Number of institutions that answered this question

40,000,000
07•	All respondents specified the Oslo Convention as a basis‌2017for excluding for investment corporations involved in clus-

a

b

c

d

e

f

g

2018

ter munitions.
• Other conventions mentioned were the Treaty on the NonProliferation of Nuclear Weapons (1968), the Biologicaland Toxin Weapons Convention (1972), the Washington
Convention (1973), the Ottawa Treaty (1997), and theTreaty on the Prohibition of Nuclear Weapons (2017).

Q18

If permitted, please provide specific asset classes
and their totals for those that listed a balance inthe “other” category in Q17.

Number of institutions that answered this question

6

The following were some examples provided by respondentsof “other” specific asset classes.
• Balanced funds• Infrastructure-related assets such as solar power plants• Alternative assets

11





Q19

In the past year, how many domestic and international companies did you have engagement or purposeful dialogue with, as stipulated by Japan’s
Stewardship Code?
Please exclude the exercisingof voting rights.

Number of institutions that answered this question
Number of Companies

Q21

30
2017

2018

Under 100

7

7

100 to 500

99 lease provide us with some commentary for disP
closure pertaining to the systematic evaluation
processes used in managing the amounts indicated in the previous questions (e.g., “ESG is
implemented by the ESG evaluation team”;“screening is conducted through the use of outsideassessment bodies or analytic data,” etc.).
Alternatively, please provide a URL that gives
access to disclosure materials.

500 to 1,000

25Number of institutions that answered this question

Over 1,000

43•	Eighteen institutions provided URLs. All websites are34

accessible to the public.

•	Of the 30 institutions that provided an answer, 26
declared the number of companies with which they con-•	Sumitomo Mitsui Trust Bank, Limited and Nissay AssetManagement Corporation contributed detailed columns induct engagement (purposeful dialogue).

response to this question to White Paper on Sustainable
Investment in Japan 2017, published on March 31, 2018.



Q20

If permitted, please provide specific examples ofengagement themes (multiple responses allowed).

Choices

Number of responses

Environmental-Related

26

Social-Related

28

Governance-Related28• In the environmental-related category, all responses on
engagement themes regarded the extent of awareness of
the impact of climate change and environmental problems
on corporate value over the medium-to-long term. There
were two examples of requests for information disclosureof environmental data.
• Fifteen of the cases provided in the social-related category
included work environment initiatives, such as work stylereform, promoting the participation of women in the workplace, and decreasing turnover rates. Five examples wereregarding the supply chain, including respect for humanrights initiatives, such as those on child labor. Other specific examples included “discussion on the effective rate oftax” and “initiatives for regional revitalization.”• Twelve of the cases in the governance-related category
regarded accounting for the board of directors’ effectiveness, the most common example. Of these, seven mentioned the role and suitability of outside directors. Othercases, eight in total, regarded accounting for capital policies
such as maximizing shareholder returns and the pros andcons of strategic shareholdings and anti-takeover measures.

12



Q22

 he names of companies and funds that provided
Tsustainable investment balances are to be disclosed
in the report for this survey. Please let us know if
you prefer that this information not be published.

Number of institutions that answered this question
Choices44
Number of responses

Agree to be disclosed

38

Prefer not to be disclosed

6•	Of the six institutions that answered “Prefer not to be disclosed,” JSIF added sustainable investment balance data
for two institutions based on publicly available information.

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