Why NextGen ESG Japan?
Our mission
Our mission is to contribute to the global efforts to limit global warming to 1.5 degrees and shift companies to a sustainable path for humanity.
Transformational change
We seek transformational change in the business models of the companies we select for our strategy. The core element of our philosophy is the belief – backed by clear evidence and track record – that ESG factors can directly affect long-term business profitability.
NextGen ESG Japan is an outcome-driven strategy, aligned with the EU Sustainable Finance Disclosure Regulation Article 9 requirements and the first one of its kind in Japan. And therefore, our strategy occupies a unique space in global ESG investment universe.
The objective of the strategy is to accelerate sustainable transition of businesses as well as to generate long-term capital appreciation by investing in a long-only concentrated portfolio of equity securities of small and medium size Japanese companies.
Sustainable transition-positive business models
We are actively seeking sustainable transition-positive business models. And therefore, NextGen ESG Japan strategy is driven by specific absolute ESG objectives over a three-to-five-year horizon.
Our strategy is built on both deep fundamental financial analysis, and a proprietary ESG engagement-centric (and forward looking) analysis model that enables us to identify material leverage points for small and medium size companies on the Japanese equity securities market.
These material leverage points are correlated to both traditional financial drivers and company specific ESG drivers. ESG dynamics are considered as an intrinsic part of the implementation of the strategy.
Managing risks in response to climate change and other factors that affect sustainability
We believe that quality and value of a company are linked to the sustainability of the business model and ESG practices now – and in the future. How a company manages the transformation of its business in response to climate change and other ESG issues can have significant implications for a company’s future profitability or its very existence.
We believe that a well-run and responsible company that cares about its stakeholders – including its employees, customers, suppliers and the environment – is more likely to be more resilient and outperform its peers than one that does not. Our proprietary ESG approach provides valuable insights about factors that have a significant impact on the financial metrics of a company and therefore become part of our strategy.
Japanese companies present an opportunity
We are based in Japan; we know Japan’s small and medium-listed companies and have worked with them for decades. Japan and Japanese companies are in the early stages of ESG-driven management transformation, and we believe this presents a clear and significant opportunity.
