Goal 17 of the SDGs promotes a diverse range of partnerships. Given the vital role of finance in the formation of a sustainable society, the Group places a strong emphasis on taking action, in partnership with various stakeholders, including other financial institutions, to tackle solutions to difficult challenges. We participate actively in partnerships within Japan and overseas.
Principles for Financial Action for the 21st Century towards a Sustainable Society (The Principles for Financial Action towards the formation of a sustainable society)
We, together with Sumitomo Mitsui Trust Asset Management (SMTAM), Nikko Asset Management (NAM) and Sumitomo Mitsui Trust Panasonic Finance, support the aims of the Principles for Financial Action for the 21st Century (PFA21), an effort in which over 280 financial institutions of all types collaborate towards the formation of a sustainable society. We have had a central role in this work since the Principles were drafted in 2011. Moreover, since 2013 we have been a member of the Financial Principles Steering Committee (the "Steering Committee"), and served as chair of the Sustainable Community Support Working Group (WG), which practices outreach and education in sustainable finance in regional areas. In FY2020, this WG has been holding a series of online seminars entitled "What is a Regional Circulation Symbiotic Sphere?" under the theme of "Considering the Role of Financial Institutions in Regions" jointly with the Bank Deposit, Lending, and Leasing WG.
Regarding the PFA21, we also participate in the Ministry of Environment’s High Level Panel on ESG Finance as an observer. At the third meeting held in October 2020, SuMi TRUST Bank’s Positive Impact Finance solutions were introduced as a representative example of impact finance in the financial world, and we (observers) explained the advanced nature of the Japanese government’s initiatives in a global context.
United Nations Environment Programme Finance Initiative (UNEP FI)
UNEP FI is an international network to encourage financial institutions to consider sustainability in their behavior. In 2003, we were the first Japanese trust bank to become a signatory. We also participate in the Property Working Group and the Natural Capital Finance Alliance (formerly the Natural Capital Declaration) within UNEP FI. Not only in Japan but we have been contributing to stronger action in the global finance industry. Moreover, we signed the Principles for Responsible Banking (PRB), which came into effect in September 2019, and declared that we do business in conformity with the SDGs and the Paris Agreement.
Since January 2019, we have also affirmed the Principles for Positive Impact Finance (UNEP FI), which provide the theoretical backbone of the Principles for Responsible Banking, and joined the Positive Impact Initiative. We are actively working together with overseas banks towards establishing more advanced measures.
PRI (The Principles for Responsible Investment)
In May 2006, we, together with SMTAM and NAM, signed the PRI, which were formulated by the United Nations Global Compact and the United Nations Environment Programme Finance Initiative (UNEP FI) as a joint secretariat. The Principles call on institutional investors such as pension funds and asset managers to consider ESG (Environmental, Social, Governance) when making investment decisions. SMTAM is participating in the Water Risk Working Group, and both SMTAM and NAM are participating in the Palm Oil Working Group and other groups to practice engagement with relevant companies.
The Principles for Responsible Banking (PRB)
The Principles for Responsible Banking were formulated for the purpose of making bank operations conform with social goals, such as the SDGs and action on human rights problems and global warming countermeasures indicated by the Paris Agreement on climate change. In September 2019, SuMi TRUST Holdings announced that it will do its utmost to practice strategic business operations in conformity with the SDGs and the Paris Agreement, becoming the first signatory institution to the Principles for Responsible Banking.
United Nations Global Compact (UN Global Compact)
The UN Global Compact, proposed by former UN SecretaryGeneral Kofi Annan, is a code of conduct regarding human rights, labor, the environment, and anti-corruption. Signatory companies are called on to take measures to implement the compact. In July 2005, we became the first Japanese bank to sign the compact, and declared our resolve to act as a good corporate citizen by complying with and promoting the code of conduct. We also became a member of the "Global Company Network Japan (GCNJ)," in which signatory companies of the UN Global Compact participate.
The FSB (Financial Stability Board), recognizing climate change as a risk affecting finance, announced its Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) in June 2017, calling for even higher levels of transparency in disclosures related to climate change. We, along with SMTAM and NAM, support the TCFD recommendations, and are working on information disclosures in line with the recommendations.
UNEP FI Property Working Group (UNEP FI PWG)
The UNEP FI PWG is one of the working groups formed by signatory institutions of the UNEP FI to promote property finance that facilitates sustainable development, namely Responsible Property Investment (RPI). In addition to joining the working group in June 2007, the Group became a member of the media team that promotes RPI and conducts activities as one of its leading members.
The Equator Principles
The Equator Principles are international guidelines for private-sector institutions to ensure that impacts on the environment and regional communities are fully taken into consideration when implementing loans such as project finance loans. SuMi TRUST Bank became a signatory to the Equator Principles in February 2016.
Business and Biodiversity Initiative "Biodiversity in Good Company" Leadership Declaration
At the ninth meeting of the Conference of the Parties to the Convention on Biological Diversity held in May 2008 in Bonn, Germany, the Group, together with 33 other companies from around the world, signed a leadership declaration under the Business and Biodiversity Initiative "Biodiversity in Good Company," which was led by the German government. Since that time, we have been playing a role as a leading company in this field and making proactive efforts to address this issue.
The Poseidon Principles
In March 2020, SuMi TRUST Bank became the first financial institution in Asia to sign the Poseidon Principles, which is an initiative established to help financial institutions address climate change risks in the shipping industry. Financial institutions that are signatories to the Principles will annually evaluate the level of achievement of CO2 emission reduction efforts for ships covered by ship finance, and calculate and announce the contribution of each bank’s overall ship finance portfolio to CO2 emission reduction efforts.
Natural Capital Finance Alliance (formerly the Natural Capital Declaration)
The Group became a signatory to the Natural Capital Declaration (NCD) proposed by the United Nations Environment Programme Finance Initiative (UNEP FI) in June 2012. The Natural Capital Declaration will be reorganized as the Natural Capital Finance Alliance to expand its initiatives.
COLTEM (Collaboration Center of Law, Technology and Medicine for Autonomy of Older Adults) is a social technology development center, supported by the Japan Science and Technology Agency under the Ministry of Education, Culture, Sports, Science and Technology. It integrates law, engineering, and medicine to provide seamless support for older adults to live in the community in conditions ranging from health to cognitive impairment. SuMi TRUST Bank participates in COLTEM, and contributes to the creation of systems for supporting those with dementia in making decisions and smoothly managing their financial transactions and assets.
Climate Action 100+
"Climate Action 100+" is a program of collaborative engagement with companies believed to have major impacts on global warming, taking place for five years from December 2017. This program is conducted based on the Task Force on Climaterelated Financial Disclosures (TCFD), lists over 100 companies around the world that have high emissions of greenhouse gas, then practices engagement with them, in collaboration with PRI, Ceres, and other signatory institutions to call for information disclosures. SMTAM and NAM participate in this initiative.
The Carbon Disclosure Project, founded in 2000 by international NGOs active on environmental issues such as climate change, is the forerunner of the CDP. This project sends annual questionnaires to companies with high market capitalizations in leading countries. The response rate it obtains from companies is rising year after year. Questionnaire responses are basically published, and scores based on action each company takes are published to the world. SMTAM and NAM participate in this initiative.
The AIGCC (Asia Investor Group on Climate Change) is a group of Asian investors concerned with climate change. It is an initiative to generate awareness among Asian asset owners and financial institutions of the risks and opportunities associated with climate change and low-carbon investment. SMTAM and NAM participate vigorously in engagement through the AIGCC.
Ceres (Coalition for Environmentally Responsible Economies) is an NGO that encourages companies to take action on environmental issues, such as global warming. It practices positive engagement through an investor network that includes 150 participating institutional investors, mainly in North America. SMTAM participates in this initiative.
SMTAM has joined FAIRR (Farm Animal Investment Risk & Return), an engagement group that mainly targets the fisheries and livestock industries, and participates in the "Sustainable protein supply chains," one of the group’s current collaborative engagement programs. It aims to raise awareness among target companies of the large ESG risks and opportunities of products made from fisheries and livestock produce, linking that awareness to improvements in corporate activities. SMTAM aims to globalize its engagement activities, and gain knowledge and presence as a result.
Access to Medicine
Access to Medicine is a collaborative body which has major Western asset managers and asset owners as signatories. Its activities address major global pharmaceutical companies to raise their awareness of medical treatment services in developing countries, and to call for improved access to medicines. SMTAM aims to strengthen its engagement with global pharmaceutical companies.
The 30% Coalition (USA), 30% Club (UK), and 30% Club Japan
This is an investor network that works to raise diversity in company boards of directors. SMTAM has signed and engaged in the activities of the Thirty Percent Coalition in the USA and the 30% Club Investor Group in the UK. It also became a signatory to the 30% Club Japan Investor Group when it was founded in May 2019, with NAM following suit in July 2019, and both companies began activities in Japan.
The Investor Agenda was founded in February 2018 by asset managers (around 480 groups and agencies) that had signed the PRI, CDP, and Ceres. It is an initiative of institutional investors promoting low carbon in climate change-related behavior. Its purpose is collaboration and liaison on investment, corporate engagement, information disclosure by investors, and policy proposals. SMTAM and NAM participate in this initiative.
SuMi TRUST Bank offers stock and bond lending (securities lending) to our institutional customers to improve the return on their portfolio investments. Securities lending has important functions such as providing liquidity to financial markets, reducing transaction costs and risks, and supporting price discovery. The Global Principles for Sustainable Securities Lending aims to establish best practices for securities lending from the SDGs/ESGs' viewpoints, including transparency, collateral, and proxy voting, and to promote sustainable finance.
SuMi TRUST Bank has been participating in finalizing the principles through the Global Engagement Governance Stewardship workstream since December 2020. In September 2021, SuMi TRUST Bank became a Global PSSL Opening Signatory and a sponsor to implement and support the activities based on the principles.