Sumitomo Mitsui DS Asset Management Joins Net Zero Asset Managers Initiative
May 13, 2022
Sumitomo Mitsui DS Asset Management Company, Limited (President and CEO: Takashi Saruta, hereafter”SMDAM”) provides high-quality asset management services to our clients, while also playing the role of an institutional investor that conducts stewardship activities for investee companies.
To fulfill such responsibility, SMDAM today announced that the company joined the Net Zero Asset Managers Initiative, a global initiative led by asset managers to achieve the long-term common goals set out in the Paris Agreement as we fully endorse the efforts by international community towards net-zero greenhouse gas (GHG) emissions by 2050. As a responsible institutional investor, we will continue to support our investee companies in their efforts to realize a decarbonized society.
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Net Zero Asset Managers Initiative The Net Zero Asset Managers initiative launched in December 2020 aiming to facilitate the asset management industry to commit to a goal of net zero emissions by 2050 or earlier. As of December 2021, the initiative has 236 signatories. Among others, commitments signatory asset managers shall make are; - to set interim targets for 2030 with a fair share of 50% of AUM in line with below 1.5℃ scenario, - to create investment products aligned with net zero emissions by 2050, - to conduct stewardship activities towards investee companies and - to publish TCFD disclosures including climate action plans on an annual basis |
SMDAMʼs approach to climate change issues
We believe that it should take decades to realize decarbonized society, and it could not be done without a breakthrough innovation. Clean energy such as wind and solar power, which are expected to replace oil and coal, still has many issues to overcome, such as their stable stability, energy density and cost. In recent years, we could observe the cases where hasty transitions from fossil fuels have led to increase in prices that were critical for vulnerable people and deforestation caused by the installation of solar panels.
In light of such circumstances and the global energy environment, we through asset management businesses will support their strategic transition to a decarbonized society with innovation as a driver from a long-term perspective while we consider taking divestment as an option for sectors and companies with high emissions. For instance, we will facilitate investee companies to improve the CDPʼs Climate Change Score* and to acquire SBT certification** through engagement while we may vote against the election of directors at shareholder meeting of companies that have insufficient disclosure and no intention of improvement.
Meanwhile, we also believe the conservation of forests and oceans, which absorb carbon dioxide, and the reduction of environmental impact through the promotion of a circular economy are equally important in reducing GHG emissions in the production and consumption of energy.
Therefore, through engagement and other means we will encourage companies that constitute the value chain from forests and oceans to consumers to contribute to the conservation of natural capital. On the other hand, in order to protect the environment and reduce the burden, it is essential to change the lifestyles and consumption behavior of consumers. To this end, we will strengthen the provision of information to beneficiaries of our investment trusts so as to increase investors and consumers seeking a sustainable society.
(Note)
* A score awarded by CDP, an environmental non-profit organization, to the world's leading companies based on responses to a questionnaire on climate change initiatives.
**SBTi (Science Based Targets Initiative), an initiative jointly operated by CDP and the UN Global Compact, provides a certification to companies that have set GHG reduction targets that are on a scientific basis and consistent with the Paris Agreement.
SMDAMʼs interim targets for 2030
Signatories of the Net Zero Asset Managers Initiative are committed to set and disclose interim targets for 2030 within a year after joining the initiative. SMDAM will disclose the interim target along with relevant action plans in a timely manner once they are formulated.
Contact
Katsuki Maruyama General Manager / Corporate Sustainability Section
Direct: +81-3-6205-1908, E-mail:katsuki_maruyama@smd-am.co.jp
Yasuko Kawase Manager / Corporate Sustainability Section
Direct: +81-3-6205-1902, E-mail:yasuko_kawase@smd-am.co.jp
Registration Number: The Director of Kanto Local Finance Bureau (KINSHO) No.399
Member of Japan Investment Advisers Association, The Investment Trusts Association, Japan and Type Ⅱ Financial Instruments Firms Association
