SDG Impact Japan acts as an Investment Advisor for a Japan Listed Equity Engagement Impact Strategy and has now published the “NextGen ESG Strategy Annual Report 2026.” Since its inception in April 2022, the strategy has conducted engagement activities, deeply immersing itself with investee companies possessing clear sustainability goals.

While ESG-related policies and regulations moved in different directions across regions in FY2025, Japan steadily strengthened its institutional foundations for disclosure and dialogue, including the publication of sustainability disclosure standards by the Sustainability Standards Board of Japan (SSBJ) and the third revision of Japan’s Stewardship Code, which promotes collaborative engagement. This report presents our strategy’s activities and progress in light of these changes in the business environment.

Key contents of this year’s report include:

• Progress on the fund’s sustainability KPIs: all KPIs have improved since the fund’s inception in April 2022
• Review of the fund’s sustainability KPIs: new KPIs on initiatives toward carbon neutrality (Scope 3) and on human capital management linked to corporate strategy, together with a stricter definition of the gender pay gap KPI
• Deep analysis: global and Japanese ESG trends, and human capital — wage growth and productivity
• Engagement cases: dialogues with two portfolio companies, covering topics such as advancing human capital management and human rights due diligence
• Collaborative engagement: an introduction to our new initiative with our asset owner to enhance the effectiveness of our engagement

We remain committed to creating value in both financial and sustainability terms through deep dialogue and collaboration with our portfolio companies.

For the full report, please download from here.

Disclaimer

• This material is not intended to solicit the purchase or sale of any specific securities, nor to solicit the conclusion of an investment advisory agreement.
• The initiatives and case studies described herein are based on past facts and do not guarantee or imply future investment performance or outcomes.
• Investments involve risks, including the potential loss of principal. Investment decisions should be made at your own discretion and responsibility.