Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate change
• Environmental protection
• Education
• Human resources
• Human rights
• Capital market
• Corporate governance
• Business continuity planning (BCP)
• Compliance
• Risk management

Environmental Achievements

• Converted all lighting in head office building to LED as an energy-saving measure
• Steadily reduced CO2 emissions

Social Achievements

• Provided technical assistance to and invested in an Indonesian securities finance company
• Held a lecture on “Financial and Securities Markets and Industry-Academia Alliance—Blockchain Case Studies” at the Graduate School of Engineering at the University of Tokyo
• Conducted joint empirical research with the University of Tokyo (Securities Finance Transactions Using Distributed Ledger Technology)
• Maintained a ratio of 50% or higher for women graduate hires to total new graduate hires
• Enhanced childcare and nursing care support system to promote work-life balance

Governance Achievements

• Transitioned to a Company with a Nominating Committee, etc. in 2019
• Increased the number of outside directors
• Revised officer remuneration in FY2023 to ensure that incentives are aligned with management policy
• Disclosed approach to the appointment of management executives and internal human resources development policy
• Strengthened the functions of the secretariat of the Board of Directors

Climate Goals & Targets

Environmental Challenges

• Stock-related businesses are prone to fluctuations in performance due to stock market conditions
• Tightening supply and demand for Japanese government bonds
• Climate change risks (transition risks and physical risks)

Mitigation Strategies

• Diversifying revenue sources beyond loans for margin transactions
• Expanding securities financing by making the most of high credit rating
• Managing climate change risks within an integrated risk management framework
• Building a resilient BCP system

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Damage to owned real estate and facilities due to major storm and flood damage
• Drop in prices of securities held as a result of worsening financial and securities markets due to the effects of extreme weather events
• Higher credit costs as a result of damage to counterparty business locations due to major storm and flood damage
• Business relocation costs incurred due to rising sea levels
• Higher credit costs as a result of damage to counterparty business locations due to rising sea levels

Transition Risks

• Higher operating costs due to taxation changes related to climate change
• Decline in securities financing balance due to factors such as worsening economic conditions
• Decline in share prices due to stakeholder criticism of JSF’s response to global warming

Opportunities

• Promoting resource and energy savings
• Utilizing renewable energy
• Offering financial services that support the transition to a carbon-free society
• Contributing to an environmentally sustainable society through investments in green bonds
• Increased demand for funding due to the expanding market for ESG investment
• Ensuring business continuity in securities market infrastructure by building a resilient BCP system

Reporting Standards

Frameworks Used: IFRS Foundation, International Integrated Reporting Framework, Ministry of Economy, Trade and Industry, Guidance for Collaborative Value Creation 2.0, TCFD recommendations

Third-party Assurance: Crowe Toyo & Co.

UN Sustainable Development Goals

• Goal 9

The development of infrastructure that serves as the foundation of socio-economic activities is a key element in realizing a sustainable society, and it is also one of the Sustainable Development Goals (SDGs: Goal 9).

Awards & Recognition

• International Finance Awards 2022, Most Innovative Securities Finance Company
• The Annual Global Economics Awards 2022 (AGEA), Best Client Services Team in Securities Lending
• The Annual Global Economics Awards 2023 (AGEA), Best Corporate Governance Practices (Finance)

Environmental Metrics

ESG Focus Areas

• Governance
• Sustainability
• Human Capital Development
• Diversity & Inclusion

Environmental Achievements

• Not disclosed

Social Achievements

• Increased ratio of women in graduate hires to 50% or higher; initiatives to support work-life balance, including childcare leave and telework; investment in an Indonesian securities finance company; collaboration with University of Tokyo on blockchain technology for securities finance.
• Improved employee engagement through various initiatives.

Governance Achievements

• Transitioned to a Company with a Nominating Committee; increased board diversity (second woman director elected); enhanced information disclosure; improved support for outside directors; revised officer remuneration to align with management policy; engaged in dialogue with shareholders on corporate value, capital efficiency, officer nomination, and information disclosure.

Climate Goals & Targets

Environmental Challenges

• Fluctuations in performance due to stock market conditions; increasing complexity of operations; need to diversify revenue sources beyond loans for margin transactions; addressing climate change.

Mitigation Strategies

• Diversification of revenue sources through securities financing; building an efficient operational structure using digital technology; strengthening financial soundness; disclosing information on climate change in line with TCFD recommendations; proactive engagement with stakeholders.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: TCFD

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• SDG 9: Industry, Innovation and Infrastructure

Supporting infrastructure functions of securities and financial markets.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed