At Nikko Asset Management Co., Ltd. (Nikko AM), sustainability is at the core of everything we do. Across our firm, we integrate environmental, social, and governance (ESG) factors into our investment management processes; we incorporate diversity and inclusion (D&I) considerations into every employee-related decision we make; and we are invested in protecting our planet through numerous initiatives at our offices, in the neighbourhoods where we operate, and beyond.
We are all determined to see our firm run responsibly and sustainably — for the long-term benefit of our clients, our employees, our communities, and our world.
Committed to diversity, equality, and the environment
At Nikko AM, corporate responsibility is at the heart of our culture. Our employees in every region are committed to greater sustainability where we work and in our world. Our sustainability efforts are focused on the three pillars of D&I, reducing inequalities, and environment & climate. We collaborate globally on initiatives related to these areas, as well as relevant SDGs, while also acting locally in our communities.
Diversity & Inclusion
We value diversity. By employing people of different races, genders, ages, abilities, sexual orientations, and religions, Nikko AM has become a much stronger organisation. Several working groups — including those on women’s empowerment, the LGBT community, racial equality, and disabilities — have been established across all regions to ensure our D&I efforts are consistently evolving and improving.
As a global firm, we are in a position to make meaningful contributions to reducing inequalities in our communities and in other parts of the world. Our employees take part in a variety of volunteer activities, and give to charities and disaster relief. Nikko AM has partnered with UNHCR in Japan to support education for refugee children.
Environment and Climate
Protection of the environment has been a primary consideration for every decision we make at our firm. Having been certified as carbon neutral, we are now striving to reduce our carbon output. In 2020, we conducted a company-wide survey to gauge how the shift to telecommuting and reduced business travel has benefitted the environment.
Having launched Japan’s first socially responsible investment fund in 1999, Nikko AM is an ESG pioneer in Asia. All the investment teams at our offices around the world have worked to integrate ESG principles and sustainability into our investment processes. We believe that attention to ESG is inherent to long-term value creation.
The Global Equity team finds purpose-led Future Quality companies that can attain the best returns on capital. We believe that the market will allocate capital to companies addressing society’s problems, and that they are best placed to sustain relatively higher returns.
The Japan Equity team pursues alpha through a combination of financial and non-financial information including ESG. We believe that a superior investment process should focus on ESG factors that lead to future earnings and strengthen competitiveness.
The Asian Equity team identifies companies that are capable of sustaining high returns and/or fundamental change. ESG is a key pillar of the assessment of sustainable returns and fundamental change. As a result we focus on ESG issues that are material to shareholder returns.
ESG is considered across the Global Fixed Income team’s entire offering and is applied at the screening & research and portfolio construction stages. An example is our Global Green Bond strategy which invests in bonds from issuers with the strongest sustainability credentials.
The Japan Fixed Income team believes it is crucial to analyse not only quantitative risks but also qualitative risks that cannot be captured by financial analysis. The ESG viewpoint is positioned as an important factor in the qualitative risk analysis.
On the Asian Fixed Income team, our Internal Credit Rating model incorporates the assessment of a range of ESG factors and risks. This research and evaluation are key elements of our credit analysis as we view ESG as essential to value creation over the long term.
As a firm, Nikko AM continually innovates and makes every effort to become more sustainable. Putting their expertise into practice, our investment professionals regularly provide insights that address ESG and investment. We feature a selection of our thought leadership articles and post the latest sustainability-related developments at our firm.
insights13 April 2021
Palm oil investing through an ESG lens
Does investing in palm oil companies pose a controversy or present an opportunity? Here is a deep-dive analysis of the palm oil sector and the material ESG issues facing it. All in all, we believe that positive ESG changes represent a strong opportunity for palm oil companies, and we look for candidates that strive towards sustainability goals and exceed their ESG targets.
Nikko AM Group targets 30% women in managerial positions by 2030
To mark International Women’s Day on 8 March, we announced we have set a target that women hold 30% of all managerial roles across the group, globally by 2030. This target, termed “30 by 2030” will accelerate women’s career advancement, and is key in guiding the firm’s initiatives to achieve greater gender diversity in a transparent way.
In our second annual report, we analyse the impact of climate change on our operating results and financial positions in the 2019 calendar year, focusing on the Task Force on Climate-Related Financial Disclosures (TCFD)’s recommendations with respect to governance, strategy and risk management.
As an asset management company, Nikko AM acts as a fiduciary on behalf of our clients, and we are firmly committed to putting their interests first. Fiduciary responsibility is the highest guiding theme for our corporate values and actions.
We strongly believe that considering ESG principles in all of our investment processes is an integral part of our fiduciary duty; ESG factors are inherent to long-term corporate value creation and contribute to the realisation of sustainable economic growth.
In order to provide high-quality financial services that truly meet clients’ needs, Nikko AM will always strive to act in the spirit of fiduciary and ESG principles. We continually innovate and make every effort to further improve our firm.