Sumitomo Mitsui Trust Holdings

Decision-making and oversight for the sustainability strategy are assigned to the highest governance body, while implementation responsibility lies with various functions, teams, or committees.

The institution discloses the monetary amount or share of its products, services, and capital linked to high-emitting and fossil fuel sectors, and identifies key sectors, clients, and investees for climate engagement. It monitors emissions from associated financing activities (Scope 3 category 15) and has set interim targets for 2025 and 2030 aligned with a 1.5C trajectory. A transition plan has been established covering operations, supply chain, and portfolio, with scope 1-3 emissions reducing in line with these interim targets.

The institution has a publicly available policy statement that commits to respecting human rights and a statement committing to respect ILO core labour rights and expects suppliers to do the same.

The financial institution identifies material sustainability impacts across its value chain but could provide more detail on the criteria used for their identification and prioritisation. Recommendations include disclosing third-party assurance for target reporting and linking senior executive remuneration to sustainability targets. SMT Asset Manager, a subsidiary, has a stewardship policy aligned with sustainability, but there is no evidence of a group-level engagement approach. The entity does not provide products or services to new fossil fuel projects, and Nikko AM has disclosed a phase-out of coal-based GHG emissions, yet there is no plan for phasing out all fossil fuel projects at the group level. The institution monitors scope 3 emissions but could specify coverage by category. It provides some methodology details for carbon footprint calculations but should cover all aspects, including data sources and emission factors. The human rights policy respects internationally recognised rights, but the risk assessment process may not focus on ILO fundamental rights. Recommendations include identifying social risks related to the net zero transition and providing examples of actions taken on salient human rights issues.

This scorecard refers to information in English which was publicly available by July 15 2024. AuM and Total assets are stated in USD for comparability and have been calculated based on reported local currency values multiplied by applicable IMF currency converter values.