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Japan's First Environmentally and Socially Responsible Pension Fund for Employees

18 November, 2004

Japan for Sustainability

The Sumitomo Trust & Banking Co. expanded its socially responsible investment (SRI) fund to handle "defined contribution" pension plans in February 2004, to meet the growing demand for corporate social responsibility (CSR) and SRI in Japan.

In a defined contribution pension plan, benefits depend on contributions to the pension fund and returns from investments selected by individuals. SRI funds have three new evaluation criteria--legal, social and environmental responsibilities--in addition to economic responsibility, the common criteria in conventional stock investments.

Sumitomo set up the investment trust called "Good Company" as Japan's first SRI fund for corporate pension plans in July 2003 and began sales in December 2003. The fund invests in about 80 companies including Matsushita Electric Industrial Co., East Japan Railway Co., and TOTO Ltd. As of the end of July 2004, the total net assets of the fund amounted to 18.3 billion yen (about U.S.$168 million).

Japan for Sustainability: http://www.japanfs.org/db/database.cgi?cmd=dp&num=792&UserNum=&Pass=&AdminPass=&dp=data_e.html