Japan’s Nippon Life Insurance announced transition finance loan guidelines for utilities and steelmakers of the country. Under the new guidelines, quantitative measurements have been devised to assess if a loan-seeking company or its project meets the standards set under the Paris Agreement on climate change.
Instead of evaluating whether each technology is green or not based on taxonomy, the guidelines focus on the company’s long-term strategy for shifting to greener operations.
Addressing a press conference Yasutoshi Miyamoto, general manager at Nippon Life’s finance and investment planning department said, “As Japanese utilities and steelmakers operate globally, their transition strategies have come under scrutiny on whether they are green or not. We hope the guidelines can serve as a tool for them to explain their approach to investors.”
The guidelines are effective immediately for investments and loans extended by the insurer.