Finance Positive Impact Finance
Overview
OJR has undertaken the “Positive Impact Finance” scheme with Sumitomo Mitsui Trust Bank, Limited (“SuMi TRUST Bank”) following the Principles for Positive Impact Finance*1, its model framework (Financial products for corporate with unspecified use of funds) and Positive Impact Real Estate Investment Framework released by the United Nations Environment Programme Finance Initiative (“UNEPFI”)*2 Positive Impact Finance (hereinafter “PIF”), as a kind of the sustainable finance, is intended to support corporate activities of which SuMi TRUST Bank comprehensively analyzes and evaluates the impact (both positive and negative) related to the environment, society and economy. The most notable feature of PIF is that the level of contribution from corporate activities, products, and services in achieving Sustainable Development Goals (SDGs) will be used as an evaluation indicator and monitored based on publicly disclosed information to support its activities through engagement. SuMi TRUST Bank assessed the initiatives of OJR both qualitatively and quantitatively as initiatives that particularly impact achieving SDGs.
The PIF has also obtained a third-party opinion*3 from Japan Credit Rating Agency, Ltd. regarding compliance of the procedures related to this evaluation to the Principles as well as the rationality of the evaluation indicators.
The Principles for Positive Impact Finance
UNEP FI developed the Principles for Positive Impact Finance in January 2017 as a financial framework for achieving the SDGs. Companies disclose the level of contributions to achieving SDGs through KPIs. Banks then provide funding by evaluating the positive impact observed from these KPIs intended to guide the borrowers to increase positive impact and reduce negative impact. As a responsible financial institution, the lending bank will check if the impact is continuing or not by monitoring the indicators.
The United Nations Environment Programme Finance Initiative (UNEP FI)
The United Nations Environment Programme (UNEP) is an executive body that implements the “Human Environment Declaration” and the “International Environmental Action Programme,” which was established in 1972 as a subsidiary body to the United Nations system.
For more details, please refer to the Japan Credit Rating Agency website. https://www.jcr.co.jp/en/