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The Rokinren Bank

PRI reporting framework 2020

You are in Strategy and Governance » Investment policy

Investment policy

SG 01. RI policy and coverage

New selection options have been added to this indicator. Please review your prefilled responses carefully.

01.1. Indicate if you have an investment policy that covers your responsible investment approach.

01.2. Indicate the components/types and coverage of your policy.

Select all that apply

Policy components/types

Coverage by AUM

01.3. Indicate if the investment policy covers any of the following

01.4. Describe your organisation’s investment principles and overall investment strategy, interpretation of fiduciary (or equivalent) duties,and how they consider ESG factors and real economy impact.

The Rokinren Bank aims, through ESG investment, to "contribute to realising a society where people can coexist in happiness" as stated in the "Rokinren Bank Philosophy." In promoting ESG investment, the Rokinren Bank sets out the "Rokinren Bank SRI Principles," the principles for the Bank's responsible investment, and espouses "socially responsible management" in its "management policy." Our asset management plan also sets out target balances for new ESG investment. In addition, based on our "Rokinren Bank SRI (Socially Responsible Investment) Principles," not only do we take economic factors including financial indicators into consideration, we also take into account corporate social responsibility, for example environment-related initiatives, compliance, consideration for employees and contributions to the local community when making investment and lending decisions.

01.5. Provide a brief description of the key elements, any variations or exceptions to your investment policy that covers your responsible investment approach. [Optional]

The Rokinren Bank SRI (Socially Responsible Investment) Principles 
Established April 1, 2010


The Rokinren Bank (hereinafter referred to as “the Bank”) places importance on corporate social responsibility in its management, with its management policy stating that the Bank “will contribute to realizing a society where people can coexist in happiness,” upheld in the “Rokinren Bank Philosophy.” The Bank believes that implementing this management policy also requires due consideration of social awareness in its investment and lending activities, and that it is also the Bank’s social responsibility to do so.

In light of this policy and as a financial institution aiming to create a sustainable society, the Bank, in addition to financial analysis, carries out the following initiatives in consideration of environmental, social and corporate governance-related issues (hereinafter referred to as “ESG issues”) when deciding on making investments or loans.

1. The Bank will incorporate ESG issues as much as possible into the analysis and decision-making processes for investments and loans.
Explanation
Not only does the Bank take economic factors including financial indicators into consideration, it also takes into account corporate social responsibility, for example environment-related initiatives, compliance, consideration for employees, and contributions to the local community when making investment and lending decisions.
The Bank uses ESG parameters to evaluate companies.

2. The Bank, when exercising its shareholder voting rights, takes ESG issues into consideration. 
Explanation
One important pillar of socially responsible investment (SRI) is to encourage social consideration on the part of company management by taking shareholder action so that companies can fulfill their social responsibilities. Accordingly, the Bank takes ESG issues into consideration when exercising our shareholder voting rights. 

3. The Bank will place importance on appropriate and adequate disclosure on ESG issues by the entities in which it invests or to which it makes loans.
Explanation
Companies have a duty to explain the overall impact of their decisions or actions on society. Information disclosure not only heightens corporate transparency but also serves as a starting point for mutual communication. Accordingly, the Bank places importance on “appropriate and adequate disclosure” as key elements for “a company that coexists with society.”

4. The Bank will deepen its understanding of the social awareness it expects from the entities in which it invests or to which it makes loans and is also sincere in its own initiatives related to ESG issues.
Explanation
The Bank’s management policy is “honest management emphasizing corporate social responsibility (CSR),” and the SRI Principles are the institutionalised system for investing and lending under CSR management. Accordingly, as an institution with the SRI Principles, the Bank also remains strongly conscious of its own social awareness and endeavor to correct deficiencies in this respect.  

5. The Bank will manage its activities and progress toward implementing the SRI Principles in an appropriate manner.
Explanation
To fulfill its own “duty to explain” and “transparency obligations,” which are important elements for the evaluation of social awareness, the Bank discloses the SRI Principles and report the status of its investment management under the SRI Principles regularly to its management executives.

In our investments based on the "Rokinren Bank SRI Principles," as a financial institution, the Rokinren Bank practises risk management (position limits and risk-limited management, unrealised gain/loss monitoring, etc.), which may result in altering our investment policies in accordance with market trends, regardless of whether the investment stocks are based on ESG factors.

01.6. Additional information [Optional].

          
        

SG 01 CC. Climate risk (Private)


SG 02. Publicly available RI policy or guidance documents

 

02.1. Indicate which of your investment policy documents (if any) are publicly available. Provide a URL and an attachment of the document.

URL/Attachment

URL/Attachment

02.2. Indicate if any of your investment policy components are publicly available. Provide URL and an attachment of the document.

URL/Attachment

02.3. Additional information [Optional].

In carrying out responsible investment, the Rokinren Bank set out the "Rokinren Bank SRI Principles" on April 1, 2010 described in SG 01.5. As for the above mentioned, the Bank also sets out a basic policy on asset management concerning its investment strategy as a whole. The "Rokinren Bank SRI Principles" can be viewed on the Bank’s website at the following URL::http://www.rokinren.com/roukinren-sri.html


SG 03. Conflicts of interest

03.1. Indicate if your organisation has a policy on managing potential conflicts of interest in the investment process.

03.2. Describe your policy on managing potential conflicts of interest in the investment process.

As stated in SG 03.3, we have established an Outline of Conflicts of Interest Management Policy.

03.3. Additional information. [Optional]


Outline of the Conflicts of Interest Management Policy
Last revised April 1, 2016
Financial institutions and financial groups regularly face competing and confronting interests and are susceptible to potential conflicts of interests. For this reason, they are required to put in place a system for conflicts of interest management to prevent clients’ interest from being unduly harmed.
As a financial institution operating under the Labor Bank Act and registered under the Financial Instruments and Exchange Act, the Rokinren Bank (hereinafter referred to as “the Bank”) has implemented systems required by these laws and established a Conflicts of Interest Management Policy (hereinafter referred to as “the Policy”) to identify and manage any “transactions involving potential conflicts of interest.”
The outline of the Policy is as follows:
1. “Transactions Involving Potential Conflicts of Interest”
The Policy applies to “transactions involving potential conflicts of interest,” which refers to transactions carried out by the Bank or its subsidiary (hereinafter collectively referred to as “the Bank, etc.”) that have the risk of undue harm to the interest of our clients.
A “client” in this context means a client that has a commercial relationship with the Bank, etc. in relation to the business of the Bank.
2. Determination of Whether a Transaction Is a “Transaction Involving a Potential Conflict of Interest”
If any of the circumstances listed below applies to the Bank, etc. or its officers and employees, the Bank will examine the transaction to determine whether it is a “transaction involving a potential conflict of interest.”
In making such a determination, the Bank uses the following criteria: “whether the transaction is against reasonable expectations of our clients” and “whether the transaction puts the Bank in a position to violate its contractual obligations or obligations under the principle of good faith and mutual trust.”
・ The Bank may be able to receive economic benefits or avoid economic losses to the detriment of a client.
・ As a result of the transaction with a client, the Bank receives benefits that are clearly different from benefits to the client.
・ The Bank has economic incentives or any other type of incentives to favour the interests of another client instead of the interests of the client in question. 
・ In connection with a transaction other than the transaction with a client in question, the Bank receives, or is going to receive any incentive in the form of money, goods, or services separate from customary fees and expenses.
・ The Bank receives benefits by using information obtained through the relationship with a client.
If the Bank is not able to determine clearly whether a transaction is a “transaction involving a potential conflict of interest,” it will manage such a transaction as a “transaction involving a potential conflict of interest.”
3. Method of Managing Conflicts of Interest Transactions
The Bank appropriately manages any transactions falling under “transactions involving potential conflicts of interest” referred to in 2. above, by using one or more of the following methods, among others, separately or in combination:
・ Separate the department to carry out transactions subject to management from the department to carry out transactions with clients;
・ Modify the terms and conditions or the method of transactions subject to management or transactions with clients;
・ Discontinue a transaction subject to management or a transaction with a client; and
・ Appropriately disclose to or obtain the consent of a client on the fact that there may be undue harm to the interest of the client in connection with a transaction subject to management.
4. Scope of Corporations Subject to Conflicts of Interest Management
Transactions subject to conflicts of interest management are transactions carried out by the Bank and its subsidiary.
The Bank has the following one subsidiary:
Rokin Card Service
5. Implementation of the System
The Bank shall appoint a department in charge of conflicts of interest management and the Conflict of Interest (COI) Officer to ensure that “transactions involving potential conflicts of interest” are identified and conflicts of interest management is conducted in an integrated manner and relevant records are maintained.
As part of our efforts to prevent any conflict of interest, the Bank shall also provide its officers and employees with education and training to ensure compliance with laws and regulations, internal regulations, etc., on conflicts of interest.

6. Audit by the Audit Department

The Audit Department shall conduct audits on the conflicts of interest management processes to examine their appropriateness and effectiveness on a regular basis.


SG 04. Identifying incidents occurring within portfolios (Private)


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