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RI Asia: GPIF CIO Mizuno wants to make Japan a leading ESG country

Investment head of world’s largest asset owner stresses commitment to ESG

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Hiromichi Mizuno, Executive Managing Director and CIO of the ¥135 trillion Japanese pension fund Government Pension Investment Fund (GPIF), said at an interview at RI Asia 2017 conference at the Tokyo Stock Exchange today that he wants to make Japan one of the leading ESG countries in the world.

He explained that the GPIF was seeking to bring about this change by motivating corporate managers with the incentive of capital inflow if they pursued the UN Sustainable Development Goals (SDGs).

While the Japanese Corporate Governance Code worked as a stick for businesses to adapt their business models to sustainability, a higher stock price, he said, was the carrot. Mizuno said: “Long-term value factors will be rewarded”.

As a super long-term investor with a 25-years time horizon, Mizuno also said that the GPIF had “zero incentive” for short-termism.

But, as the financial system needs to be reformed and become sustainable to achieve results, the GPIF signed up to the Principles for Responsible Investment (PRI) in 2015.Since then, GPIF has pursued a number of stewardship activities, among them the convention of the Global Asset Owners’ Forum.

Mizuno’s aim to put Japan at the forefront of ESG was backed by the Governor of Tokyo Yuriko Koike.

She announced in a preceding keynote that she aimed at making Tokyo one of the number one global cities of the future by increasing its safety and diversity, and turning it into a smart city with a GDP of 120 trillion Yen.

The Tokyo Metropolitan Government, she said, planned to issue a green bond of 20 billion Yen for that purpose, turning also the Tokyo 2020 Olympics into green games.

“ESG is the backbone to build the smart city in Tokyo”, Koike said, and will house an international financial hub by supporting the relocation of international asset managers and companies to Tokyo.

RI Asia 2017, which continues tomorrow, features a line-up of high level speakers from Japan, Australia, Europe and the US and has more than 600 registered delegates.