Source: asiainsurancereview.com

Four major domestic life insurance companies have announced that they will strengthen their commitments to Environmental, Social and Governance (ESG) investment in the second half of the fiscal year ending 31 March 2021 (FY2020), focusing on how the companies in which they invest address the environment and other issues.

From 2021, Nippon Life Insurance will incorporate the ESG concept in dealing with total assets of about JPY70tn ($670bn). The company invests about JPY3tn to JPY5tn in new assets every year, but will proceed with asset replacement based on ESG, reported The Yomiuri Shimbun.

Dai-ichi Life Insurance will adopt the ESG concept by FY2023 for its total assets of JPY36tn. From this fiscal year, analysts specialising in ESG have been added to the analysis of investments.

Meiji Yasuda Life Insurance will make use of ESG evaluations of investment targets carried out by external institutions, while Sumitomo Life Insurance will utilise data on greenhouse gas emissions and other factors to analyse its investment assets.

In many cases, the major life insurers are large shareholders in Japanese companies. As life insurance companies increase their ESG investments, efforts by Japan corporations to address ESG could accelerate as they are likely to be forced to strengthen their efforts aimed at reducing greenhouse gas emissions and making contributions to society.