The SuMi TRUST Group recognizes that addressing the issue of climate change is key to the Group’s corporate value and the building of a sustainable society. We will therefore continue to develop solutions-based businesses that help tackle the problem of climate change.
Priority issues (materiality) concerning climate change
The Group recognizes the following priority issues for management: (1) minimizing the climate change impacts generated by companies and projects the Group invests in or extends loans to; and (2) reducing CO2 emissions stemming from the Group’s business activities.
We are also cognizant of the fact that expanding the Group’s business opportunities by helping to solve climate change problems with the use of trust functions is also a priority issue.
Items of materiality in the SuMi TRUST Group concerning climate change
- Considering impacts on society and the business environment of companies to whom we extend investments and loans
- Pursuing sustainability-themed business opportunities
- Climate change
- Risk management and resilience
Action Guidelines for Mitigating Climate Change
- 1.Implementation of Measures and Support to Help Mitigate Climate Change
In addition to actively taking measures to reduce greenhouse gas emissions in our own business operations, we are making efforts, as a corporate citizen, to support activities that mitigate and adapt to climate change.
- 2.Provision of Products and Services
We are working on developing and providing products and services that help mitigate climate change. Our financial functions are being leveraged to promote energy conservation and encourage the use of renewable energy.
- 3.Collaboration with Stakeholders
We engage in dialogue and cooperation with our stakeholders as we work to mitigate climate change.
- 4.Education and Training
We will ensure that these guidelines are fully implemented at Group companies, and will actively conduct education and training to mitigate climate change.
- 5.Information Disclosure
We will actively disclose information related to our efforts to mitigate climate change.
Materiality management concerning climate change
Through internal engagement, the Group endeavors to improve initiatives and enhance information disclosure regarding climate change issues identified as items of materiality.
Identification and utilization of materiality
STEPIdentifying materiality issues
We prioritize the viewpoints of ESG investors seeking corporate value from a long-term perspective. We then identify the materiality items in banking emphasized by the major ESG research firms (MSCI, FTSE, SAM, etc.) that provide information to investors based on GRI, SASB, and other reporting guidelines.
STEPHearings with stakeholders
The issues identified in step 1 are evaluated from two perspectives: 1) the impact on corporate value in the medium term, and 2) the impact on stakeholders. The degree of impact is assessed with a score between one and five. The former is conducted by all our external directors, external auditors, and relevant internal departments, while the latter by external directors, external auditors, and external experts.
STEPDrawing materiality map
The point scores from step 2 are plotted on a scatter diagram (materiality map) with the two perspectives assigned either the horizontal or vertical axis. The issues that fall into the highest materiality zone on the map are considered to be priority ESG issues. In 2015, these issues were resolved by the Executive Committee and reported to the Board of Directors. Since 2017, the Risk Committee (an advisory committee of the Board of Directors) has examined the appropriateness of these issues and offered recommendations to the Board of Directors.
STEPImplementation of internal engagement
Of the issues with the highest materiality, our Sustainability Management Department engages in dialogue (engagement) with relevant departments with respect to the topics investors are most interested in and for which the Group’s initiatives may face challenges. Reports are submitted to the Executive Committee and the Board of Directors on the progress of initiatives.
STEPInitiatives for increasing long-term corporate value
The Board of Directors receives recommendations from the Risk Committee and reports on internal engagement and facilitates multilateral discussions on the future course of action. These actions are in line with the provisions of Article 3-4 of the Group’s Basic Policy on Corporate Governance, which prescribes matters regarding environmental and social issues concerning sustainability that the Board of Directors is obligated to address.
Results of internal engagement on climate change
- Adoption of the Equator Principles in project finance
- Formulation of a financing policy for coal-fired power generation projects
- Launch of a TCFD Project Team