Rewarding ESG disclosures

This Japanese sustainable investment and futures report, written in collaboration with SGX, reviews 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 Futures.

Key highlights from this quarter’s analysis:

• The gap in ESG performance between Japanese companies and their European counterparts (as measured by FTSE Russell ESG Scores) is closing, with their Environmental Scores now nearing parity
• However, challenges remain for Japanese companies, particularly in the Social domain, where disclosure rates still lag behind those seen in Europe
• SGX FTSE Blossom Japan Index Futures continues to lead the Japan ESG derivatives space, and the broader Blossom Index family is also demonstrating significant outperformance versus the broader market