Japanese asset managers have improved on their environmental, social and governance practices but still lag their European counterparts, according to the World Wide Fund for Nature Singapore (WWF-Singapore).
The conservation group assessed 22 European and 18 Asian asset managers on their ESG incorporation for its annual report on sustainable portfolios that protect nature and drive decarbonisation. The Asian managers comprised six from China, five each from Japan and Singapore, and two from India.
It found that Asian asset managers are advancing their sustainable finance practices compared with 2020, with Japan narrowing the gap with Europe.
The score of Japanese asset managers rose to 59% in 2021 from 52% in 2020. But they were still behind their European peers, whose average score climbed to 74% from 72%.
“The improvement in the average scores for the Japanese asset managers are both in absolute and relative terms,” WWF-Singapore says in a statement on February 9.
It also says the 2021 report has ten new Asian asset managers – four from China and three each from Singapore and India – because they met requirements to be included in the survey by becoming signatories to the United Nations-supported Principles for Responsible Investment and having minimum assets of US$20 billion.
According to the conservation group, this addition suggests that “an increasing number of Asian managers are increasing their awareness of, and commitment towards responsible investing practices”.
“It is critical that investors are empowered and committed to deliver on their ESG goals by going beyond managing the ESG risks in their portfolios, to also create positive and measurable environmental impact from their investment activities,” Aveline Chan, vice president of Asia sustainable finance at WWF-Singapore, says in the statement.
