Japan’s Pension Fund Association for Local Government Officials, known locally as Chikyoren, has released sustainability investment policies thatdefine its approach to environmental, social and governance investing.
The pension fund, Japan’s second largest with 37.58 trillion yen (US$264 billion) of assets under management, unveiled the policies in a statement posted on its website on March 31.
All of Chikyoren’s assets must now be invested according to sustainable principles, and must include stewardship responsibilities, impact investing and consideration of ESG factors.
The pension fund will monitor its external asset managers to ensure they comply with the stewardship policies and effectively execute sustainability investment strategies.
Policy outcomes will be evaluated on a case-by-case basis and adjustments will be made if investments do not meet expected goals.
“The fund will exchange opinions with other asset owners and build relationships to support sound sustainability-related decision-making,” Chikyoren says.
The pension fund also aims topromote ESG investments. It will focus on ESG index-linked investments and bonds to encourage index constituents and debt issuers to improve ESG performance.
Chikyoren says it will also enhance disclosure of ESG information to fund members through explanatory meetings and publications.
