Evolution of corporate ESG disclosure and expansion of ESG Investment

ESG investment in Japan is being boosted by various tailwinds, including public pension funds signing the Principles for Responsible Investment (PRI) and the rollout of the Nippon Individual Savings Account (NISA). Supporting greater ESG investment opportunities, there are more high-ESG-scoring Japanese companies with substantially improved ESG disclosure.

The latest Japanese ESG indices and passive investment report, written in collaboration with SGX

Each quarter, we review the development of Japan’s sustainability standards, the ESG performance of Japanese listed companies compared to the broad-market index, and the growth of index-linked SGX FTSE Blossom Japan Index Future.

Our latest edition of the Japanese sustainable investment and futures report explores the connection between increased disclosure and investment.

Key highlights from this quarter’s analysis:

• As of March 2024, 311 stocks were included in the Blossom Japan Index, which selects stocks with a FTSE ESG score of 3.3. That’s an increase from 255 in March 255.
• Both the FTSE Blossom Japan Index and the FTSE Blossom Japan Sector Relative Index continued to outperform their reference benchmark FTSE Japan All Cap Index in Q2 2024.
• After reaching a record open interest of US$ 173.7 million in March 24, SGX FTSE Blossom Japan Futures daily average volume hit a new high of US$13.8 million in June 24 (+26% yoy).