AXA IM wins €125m ESG credit mandate from Japan’s biggest life insurer

Nippon Life Insurance Company, Japan’s largest insurer by revenue, has hired France’s AXA Investment Managers to run a specialist ESG credit mandate for €125m investing in European corporate bonds that score highly on ESG factors alongside the financial and risk-return profiles of the issuers, as it stretches its sustainable fixed income coverage towards the $1bn mark.
Nippon Life, familiarly known as Nissay, has been one of Japan’s leading institutions in examining sustainability aspects within its bond allocations.
Last week it invested JPY11.4bn ($100m) in bonds issued for the first time to institutional investors by the African Development Bank for sustainable development, notably water and sanitation programmes. That followed a JPY4.5bn ($41m) allocation in August to a Woman Bond issued via private placement by Banco del Estade de Chile in a programme that supports financial and administration services to women lead business and loans to female entrepreneurs. Nippon Life set up its Credit Investment Department in 2014, and has been investing in ESG bonds across the globe, including an investment in the first Paris Green Bonds. Its total ESG bond investments already exceed an immediate target it had set of JPY100bn ($850m) for the programme.Yasutoyo Takada, General Manager of the Credit Investment Department at Nippon Life, said: “At Nippon Life Insurance Company, one of our Fundamental Management Principles is to commit that we will, in recognition of the public service aspects of the life insurance business, strive to contribute to the elevation of social welfare level through proper investment activities. AXA Investment Managers is a pioneer when it comes to ESG analysis in the area of credit, and we will be further strengthening our ESG efforts through this collaborative project. Corporate initiatives toward sustainability are now essential factors for investment decisions. Going forward, we will be contributing to the further development of the ESG market by communicating our ideas during dialogues with companies and at international conferences.”
Francisco Arcilla, CEO and Representative Director of AXA IM Japan, added: “This mandate is testament to AXA IM’s growing profile in Japan where ESG investing is becoming increasingly significant as part of the redevelopment of the Japanese financial industry under Abenomics. We are delighted that Nippon Life is investing with us in this particular strategy, which strongly resonates with one of AXA IM’s core focus areas – responsible investing.”