The Financial Services Agency is to revise its code of conduct for institutional investors early next year to encourage them to focus on ESG when making investments.
The revisions will call on trust banks and other institutional investors to engage in dialogue with investee companies and clearly state how they will incorporate ESG into their investment strategies, reports local newspaper Nikkei Asian Review.
The aim is to roll out the updated code as early as March 2020.
Modelled after the UK version, which was introduced in 2010, Japan’s stewardship code was published in 2014.
It was last revised in 2017.
It is non-binding, however, leaving institutions to decide whether or not to adopt the recommendations.