1. Conveying international messages Conveying advanced “SDG business management” tackled by

Japanese companies Attracting ESG investment by taking advantage of “SDG business

management” “Data Free Flow with Trust (DFFT)”

Summary of the Report of the SDG Management / ESG Investment Study Group

3. Encouraging investors to implement long-term investment Encouraging investors to be committed to long-term investment Correlation between long-term investment and returns

Disseminating and further raising public awareness of the Declaration of Active FundManagers

Examining and streamlining ESG investment performanceReview toward the creation of market structures stimulating long-term investment

4. Cultivating new markets through SDGs Cultivating new markets that have been overlooked from the aspect

of solving social challenges

Studying potential of support measures for cultivating new markets through SDGsCollaborating this measure with the measures for encouraging businesses to cultivate

new markets in Asia and Africa as well

5. International rule-making Ascertaining international trends in investment related to

sustainable finance (SF) or SDGs International development of the Guidance for Integrated Corporate

Disclosure and Company-Investor Dialogues for Collaborative Value Creation

Surveys and analysis of international trends related to investment and inputs thereforInternational development of the Guidance for Collaborative Value Creation

Framework

6. Disseminating scientific and logical evaluation Importance of scientific and logical evaluation, which are not

overwhelmed by subjective discussions

Analyzing and streamlining approaches taken by investors and rating companiesProviding companies with accurate advice through counseling opportunities for

successful establishment of Japan-oriented international standards, etc.

2. Promoting efforts by companies for tackling business managementfrom a long-term perspective

“Creating” innovations through “collaboration” between largecompanies and venture businesses or the academic sector

Placing weight on investment in intangible assets, e.g., humanresources

Promotion of long-term R&D investment Improving information disclosure, e.g., SDGs and long-term

visions

Making use of “dejima,” or an independent branch section of the main organization,by large companies; and promoting “ambidextrous business management,”promoting industry-academia-government collaboration, and expanding scale ofsupply of risk money

Promoting health and productivity management, investment in human resources,diversity management, etc.

Promoting long-term R&D as a source of radical research Improving information disclosure by companies (efforts involving SDGs, long-term

visions, etc.; disseminating and further raising public awareness of the Guidance forIntegrated Corporate Disclosure and Company-Investor Dialogues for CollaborativeValue Creation)

Formulating and conveying the Guide for SDG Business ManagementConveying the guide taking advantage of the G20 and other international meetings

and a variety of eventsConveying the guide in collaboration with related organizations inside and outside

JapanConveying the DFFT policy

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Six challenges that the study group found through their discussions:

Future directions for addressing the challenges

Chapter 1 titled “SDGs- A source of Value” streamlines the meanings of SDGs for companies, investors and other stakeholders. Chapter 2titled “Practicing SDG business management” streamlines discussions on key points of which companies, investors and other stakeholdersshould be aware of to implement SDG business management. The Guide for SDG Business Management was prepared based on thesechapters.

Chapter 3 titled “Policy Recommendations” streamlines challenges found through discussions and offers future directions for addressing thechallenges, which are shown below.

（Reference）Overview of the Guide for SDG Business Management The Ministry of Economy, Trade and Industry (METI), Japan formulated “The Guide for SDG Business Management”, based on the discussion of

the SDG Management / ESG Investment Study Group through its six meetings. METI released the guide in May 2019.

The guide is a well-organized compilation of opinions offered by CEOs of large and startup companies, institutional investors, a head of auniversity, and heads of international organizations. It provides essential points of “SDG business management” in which companies makeefforts for SDGs through their main business and viewpoints that investors may take in assessing companies’ such efforts.

The guide mainly aims to: [i] provide a compass that companies worldwide may use in making efforts for new or additional SDG businessmanagement and also provide viewpoints that investors may take in assessing companies’ SDG business management; and [ii] call globalattention to outstanding efforts of Japanese companies integrating SDGs into their business management, thereby encouraging investmentfrom overseas into Japanese companies.

Taking advantage of appropriate opportunities, such as the G20 and TICAD, METI will strive to convey messages and information on theguide to people inside and outside Japan and will also endeavor to disseminate and popularize the guide.

As the presence of the millennial generation, “SDG natives”, hasbeen becoming stronger as investors, employees or consumers, SDGbusiness management is considered to serve as an important keyfor companies to win investments, human resources andcustomers.

Through SDG business management, companies are able to findeconomic rationality in a way to solve social issues and, based onthis, pioneer new markets that have been left untapped.

Companies are able to “collaboratively create” innovation to solvesocial issues, through collaboration between major companies andstartup companies or academia or long-term R&D investment.

Companies should place SDG business management as part oftheir “value creation story” and, based on this, accurately delivermessages to “the people you want to choose you.”

Scientific and logical verification / evaluation should bethoroughly conducted and this value should be shared withstakeholders inside and outside Japan.

Many Japanese companies regard SDG business management asnatural as exemplified by the principle of ‘sanpo-yoshi’ (‘good inthree directions’ meaning that commerce should not only benefitthe buyer and the seller but also society as a whole) .

<Contents of The Guide for SDG Business Management>

Part 1. SDGs－A source of value

I. What SDGs mean for corporations

II. What SDGs mean for investors

– SDG business management and ESG investment –

III. A “bridge” to multi-stakeholders

Part 2. Practicing SDG business management

I. Economic rationality and solutions to social issues

II. Specify important issues (“materiality”)

III. Create innovation

IV. “Scientific and logical” verification / evaluation

V. Management systems that secure a long-term perspective

VI. Promotion as a “value creation story”

Major messages that the guide provides

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The Guide for SDG Business Management

May 2019Ministry of Economy,

Trade andIndustry(METI),

Japan

Taking advantage of a variety of “common languages” between companies and investors based on the same philosophies as those of the guidance, companies are able to disclose their information according to their purposes and attract investments in a more efficient manner.

Reference: Overview of the Guidance for Collaborative Value Creation Framework:“Common languages” based on the same philosophies as those of the guidance

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