Daily ESG Briefing: Japan’s FSA appoints committee on ESG data providers

The latest developments in sustainable finance

Japanese financial regulator the Financial Services Agency has appointed a “specialised subcommittee on ESG evaluation and data providers” which met for the first time yesterday. The committee is chaired by academic Tetsuo Kitagawa – an active member of sustainability body ICGN – and includes representatives from Nomura, Manulife, Sumitomo Mitsui, Nissay AM, Sustainalytics and MSCI. The Ministry of Economy, Trade and Industry and the Ministry of the Environment – which have played key roles in the country’s sustainable finance policy – have been named observers. The FSA has previously said that it plans to develop a ‘code of conduct’ for ESG data providers which will encompass governance, transparency and comparability.

French investor Mirova has said it does not plan to sell its stake in scandal-hit nursing home operator Orpea, emphasising the need to push the company to improve “quickly and strongly”. Mirova holds a 3.9% stake in the firm, which was accused in a new book of systematically cutting corners and mistreating residents at its French retirement homes, prompting a mass sell-off in shares which wiped €3.4bn off its market value. The company denies the allegations, but has brought in a new CEO and hired two firms to conduct an independent enquiry.

Investors have welcomed BP’s commitment to reach net zero across all three scopes by 2050 and its improved ambition to halve emissions from its operations by 2030. Bruce Duguid, Head of Stewardship for EOS at Federated Hermes, one of the lead engagers at BP for the Climate Action 100+ initiative, said: “In the context of strong financial results, we welcome BP’s strengthening of its low carbon ambitions. In response to engagement, bp has become the first oil & gas major to put in place a triple net-zero target covering each of its operating emissions; upstream energy produced and downstream energy products sold […] We look forward to understanding in detail the strategy by which BP will achieve this”. Jamie Maddock, Equity Research Analyst at Quilter Cheviot, said that the firm’s quadrupling of its renewables pipeline to 24.5GW since 2019 was a “standout achievement”. BP will give shareholders an advisory vote on its net zero ambition at its AGM.

Glass Lewis has launched an ESG ratings product aimed at providing investors with “the timeliest data of its kind” to support proxy voting decisions. The scores will be included in a dedicated ESG report that clients will receive as part of Glass Lewis’ Proxy Papers and is based on data collected close to company AGMs. Details about the product’s proprietary methodology were not provided.