Japan’s major public pension funds, managing approximately ¥90 trillion ($566 billion) in assets, are set to increase their ESG investments after signing the United Nations-backed Principles for Responsible Investment (PRI).
This year, six funds, including the National Pension Fund Association with ¥4.6 trillion in assets, have signed the non-binding agreement.
Globally, over 5,300 organisations, including asset managers and pension funds, are signatories. Japanese retirement funds, which were slow to adopt PRI, were encouraged to do so by Prime Minister Fumio Kishida, who announced last year that Japan’s seven public pension funds were moving toward signing.
The Government Pension Investment Fund, one of the world’s largest retirement savings managers, signed PRI in 2015 and has since increased its ESG holdings through passive, index-based purchases.
Since June this year, three additional funds, including those managing police and public school retirement money, have become signatories. PRI includes six principles aimed at integrating ESG issues into investment analysis and ownership policies.