Principles of the ESG Policy
The significance of responsible investment has been increasing globally in recent years with Japan promoting the adoption of the stewardship code and the corporate governance code. In response to this trend, there is growing interest amongst investors regarding ESG performance.
This ESG Policy has been developed by the Unison Group to meet the expectations of stakeholders, including investors, regarding compliance with environmental and social norms, contribution to society, and risk management and value creation from investee companies that the Unison Group has a partnership with,
Purpose of the ESG Policy
The corporate philosophy of the Unison Group is to enhance corporate value in harmony with people.
The Unison Group, based on this ESG Policy and seeking harmony with investee companies, investors and stakeholders, aims to contribute to the improvement of corporate value through the inclusion of non-financial ESG factors in the investment process to identify opportunities to improve corporate value and risk management
Scope of the ESG Policy
This ESG policy, in principle, applies to the companies in which the Unison Group and the funds managed by the Unison Group invest. Investee companies in which investments have been made prior to the introduction of this ESG policy are required to adopt its requirements where the Unison Group is the majority shareholder.
Approach to ESG
ESG Factors including those listed below are taken into consideration as a part of ESG activities. Additionally, investee companies and their subsidiaries are required to operate in compliance with the laws of the countries in which they operate.
- Environment: regulatory compliance covering air, wastewater, waste and soil and groundwater contamination etc
- Social: elimination of anti-social forces, remuneration systems, labor relations, health & safety, training and education, working conditions, customer health & safety and customer information privacy
- Governance: corporate governance compliance. independence of the board of directors, and inclusion/diversity
In the area of governance in particular, there is significant potential for this group to create new value by offering a “solution space” bolstered by the abundance experience it has acquired thus far, and the focus would first be on enhancing corporate value through improvements when issues are identified at the stages of screening and due diligence.
- Screening (ESG Pre-due diligence)
ESG pre-due diligence screening of potential investment candidates will be carried out using an ESG checklist or similar approach with support from external specialists as necessary.
- Due Diligence
Where ESG due diligence is considered necessary, external specialists will be appointed to assess the ESG factors identified during the pre-due diligence screening.
- Holding Period ESG Monitoring
During the holding period, investee companies will prepare a CSR report for the purposes of monitoring ESG factors identified during due diligence, as well as establishing an ESG policy and setting KPI’s as considered necessary. Investee companies are required to promptly provide reports in the event of serious incidents and to take measures through the Board of Directors of investee companies
- Reporting to investors
Information regarding ESG performance of investee companies will be disclosed annually to investors with prompt disclosure of significant incidents.