[NPO A SEED JAPAN] Announcement of ranking of climate change initiatives of 16 Japanese asset management companies
*View in browser* *NPO A SEED JAPAN*
Press release: March 31, 2024
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Announcement of ranking of climate change initiatives of 16 Japanese asset management companies
*~1st place Asset Management One, 2nd place Nikko Asset Management, 3rd place Nomura Asset Management~*
A SEED is an international youth environmental NGO that has been involved in rating private financial institutions’ ESG policies and conducting actual investment and loan case studies.
JAPAN and the Research Center for Environment and Sustainable Society (JACSES) are working with *16 major Japanese asset management companies*
(Selected management companies from major financial groups. Foreign companies excluded.) *
Evaluate* based on 25 criteria such as emission reduction targets, presence or absence of policies regarding fossil fuels, policies and implementation status regarding engagement and voting rights, etc. We conducted climate change initiative scoring*.
As a result, * Asset Management One came in first place, Nikko Asset Management came in second place, and Nomura Asset Management came in third place *.
On March 4, 2024, we sent draft survey results and evaluation methods to 16 companies, and received feedback until March 29.
A summary of the companies evaluated and the results are as follows. * [Major Japanese asset management companies surveyed (in order of scores)] * Asset Management One Co., Ltd. (1st place)
Nikko Asset Management Co., Ltd. (2nd place)
Nomura Asset Management Co., Ltd. (3rd place)
Sumitomo Mitsui Trust Asset Management Co., Ltd. (4th place) Shinkin Asset Management Investment Trust Co., Ltd. (5th place) Nissay Asset Management Co., Ltd. (6th place)
Daiwa Asset Management Co., Ltd. (6th place)
Resona Asset Management Co., Ltd. (8th place)
Mitsubishi UFJ Asset Management Co., Ltd. (9th place)
Norinchukin Zenkyoren Asset Management Co., Ltd. (9th place) Meiji Yasuda Asset Management Co., Ltd. (11th place)
Sumitomo Mitsui DS Asset Management Co., Ltd. (12th place)
Sompo Asset Management Co., Ltd. (13th place)
Tokio Marine Asset Management Co., Ltd. (14th place)
SBI Asset Management Co., Ltd. (15th place)
SBI Okasan Asset Management Co., Ltd. (15th place)
* [Summary of scoring results] *
According to this survey, Net Zero Asset Managers, mainly major Japanese asset management companies,
Although the signing of the New Zealand Initiative (NZAMI) and the 2050 Net Zero Declaration have been made, *
No company has set an ambitious 2030 portfolio greenhouse gas emissions reduction target of more than 50% (Q4) *
. NZAMI signatories are required to “set targets that are consistent with the ‘fair share’ of the global call to reduce CO2 emissions by 50% in 2030.” *
Japan, which is responsible for historic emissions, is required to pay its fair share, or reduce emissions by more than 50%, and Japanese investment companies can be said to do the same*.
Additionally, Asset Management One and Nomura Asset Management use the “SBT portfolio coverage ratio” (the percentage of SBT-certified companies in their investees) as their 2030 target. However, because this indicator does not indicate the actual amount or rate of emission reduction as of 2030, it was not possible to add points to the above question (Q4) asking about the 2030 reduction target value (%).
this*
In order to achieve the 2030 emission reduction target, it is necessary to have some kind of policy that limits or excludes investment in coal, oil, and gas mining and power generation businesses, and to encourage companies to transform their businesses. * However, * only Asset Management One and Sompo Asset Management had such a policy (Q5-Q9) *.
None of the companies had a policy regarding businesses related to biomass power generation or hydrogen/ammonia power generation, whose effectiveness as a measure against climate change is questionable (Q10/Q11). Please refer to the link in the annotation regarding the problems with the use of biomass, hydrogen, and ammonia for power generation [1].
Also,*
For Japanese asset managers, which have a large proportion of passive investments, it is important to demand stronger action from large emitters (including those in the coal, oil, gas and power generation sectors) through engagement and voting.
*However, currently, few companies have sufficient policies in place to support this, and most companies do not disclose the scale and status of engagement. *
Mitsubishi UFJ Asset Management Resona Asset Management is the only company that discloses the scale of climate change-related engagement (number of companies) *
It was (Q17).
* *
When exercising voting rights, it is necessary to encourage investee companies to strengthen their efforts to reduce emissions.Currently, the standards for exercising voting rights require the setting of emission reduction targets and the formulation and disclosure of business plans that are consistent with the goals of the Paris Agreement. Asset Management One, Daiwa Asset Management, Nikko Asset Management, Nomura Asset Management, Sumitomo Mitsui Trust Asset Management
* remained at (Q21/Q22).
* Only Asset Management One had language encouraging the reduction and withdrawal of fossil fuel use (Q23).
Note that some asset management companies separately clarify and publicize the management style (initiatives on ESG issues) required of investee companies, engage with investee companies based on this, and appoint directors if improvements are not seen. Some have said they oppose the bill. For Daiwa Asset Management and Nomura Asset Management, we also referred to their documents as part of our voting standards [2].
* Presented to Japanese megabanks, trading companies, and electric power companies by domestic and international environmental NGOs at the 2023 general meeting of shareholders.*
Shinkin Asset Management Trust also voted in favor of all shareholder proposals* to strengthen climate change countermeasures*
Only one company had an average approval rate of 30% (Q24).
* Going forward, it is hoped that asset management companies will more actively support shareholder proposals related to climate change. *
[1] [NGO Joint Statement] Co-firing and mono-firing biomass in coal-fired power generation is greenwashing, accelerating climate change and destroying forest ecosystems (April 11, 2023)
https://kikonet.org/content/24105
[Fact Sheet] Hydrogen/Ammonia Fuel – Options that are not a solution https://beyond-coal.jp/documents/documents-factsheet-ammonia/ [2] Daiwa Asset Management “The ideal management style of our investee companies (best practices)”
https://www.daiwa-am.co.jp/company/managed/Bestpractice_202302.pdf Nomura Asset Management “Desirable management style for investee companies” https://www.nomura-am.co.jp/special/esg/pdf/vote_policy.pdf?20231124
* 【detail】*
・Attachment 1) Survey on the status of climate change initiatives by asset management companies (FY2023) List of questions and evaluation items
・Attachment 2) List of results for each company (version as of March 29, 2024)
Please view and download the attached data (PDF, Excel) from the link posted on the website below.
URL: https://aseed.org/240331_assetmanagers_climate_pressrelsease
*We have received feedback from the following asset management companies by March 29th.
-Asset management companies that received feedback-
Asset Management One Co., Ltd., Resona Asset Management Co., Ltd., Norinchukin Zenkyoren Asset Management Co., Ltd., Sumitomo Mitsui DS Asset Management Co., Ltd., Sompo Asset Management Co., Ltd.
*Although we have not received any feedback from Mitsubishi UFJ Asset Management Co., Ltd. (as of March 31st), our organization’s
re-investigation revealed errors in the draft score, and we have updated the evaluation for some question items. I am.
that’s all
Specified non-profit organization A SEED JAPAN https://www.aseed.org/ (ESG Watch Project website: https://www.aseed.org/esgwatch/)
*This research and press release was conducted and created with the support of the 2023 Japan Environmental Restoration and Conservation Corporation Global Environment Fund.
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