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ESG financing

最終更新日:2026/03/06

ESG finance refers to investment and lending activities that emphasize a long-term view and consider Environmental, Social and Governance (ESG) information in the process of analyzing and evaluating corporate value. The capital flow that considers ESG criteria is spreading worldwide rapidly.

Key global challenges that ESG finance is designed to address include Climate Change, Biodiversity Conservation and Circular Economy. For Climate Change, Japan has declared its commitment to achieving net-zero greenhouse-gas emissions by 2050, prompting stronger nationwide decarbonization efforts. In the field of biodiversity, the “Nature Positive” concept has emerged, calling for measures that halt and reverse biodiversity loss. December 2022 saw the adoption of the Kunming-Montreal Global Biodiversity Framework, and in March 2023 the Japanese Cabinet approved the National Biodiversity Strategy 2023–2030, which sets a 2030 Nature Positive target. Furthermore, on 19 January 2021, Ministry of the Environment (MOE) and Ministry of Economy, Trade and Industry (METI) jointly released “Guidance on Disclosure and Dialogue for Promoting Sustainable Finance related to the Circular Economy.”

Given these trends, ESG considerations are expected to remain a pivotal factor in future investment and lending decisions.

Transition Finance

According to the “Basic Guidelines on Climate Transition Finance,” first issued in May 2021 and revised in March 2025, transition finance is defined as a financing approach that supports companies tackling climate change by helping them implement long-term, strategic initiatives to reduce greenhouse-gas emissions on their pathway toward a decarbonized society.

In order to achieve Japan’s 2050 carbon-neutral goal, it is important to promote the finance to projects that are already at or near net-zero such as renewable-energy projects. In addition, it is important to provide financial support that enables high-emitting sectors to transition, step by step, toward full decarbonization.

Human Rights Risk

“Human rights” are representative of risks falling under the social aspect―the “S”―of ESG. In October 2020, an action plan for “Business and Human Rights” was formulated and presented to the public to promote respect for human rights in corporate activity. This reflects the fact that, as in other countries, there is growing demand in Japan for companies to pay attention to human rights when engaging in business activity. The occurrence of human rights violations among a company’s employees or in its supply chain can present risks in terms of compliance issues, boycotts, and other impacts on business.

Climate Change Risk

According to the Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), climate-related risks are divided into two main categories (1) Physical risks—potential impacts on the value of financial assets caused by climate- and weather-related events, and (2) Transition risks—those emerging in the shift to a decarbonized society, such as regulatory risks due to tightening of greenhouse gas regulations and reputation risks.

SERVICEExamples of Services Provided by E&E Solutions
ESG Support Services
ESG initiative support
Sustainable finance: Sustainable bond & loan assistance (issuance support and financing-framework development)
Transition Support (Quantitative Analysis of Environmental Improvement Effects, Consulting, Review)
Advisory services for financial institutions and related entities

To promote environmentally and socially sustainable businesses, we provide wide range of consulting services to project companies and financial institutions.
For project companies, our support covers the assessment of project risks including water risks and biodiversity risks, and the development of sustainable financing frameworks for fundraising.
For financial institutions which are considering ESG related finance (e.g. sustainable finance), we provide consulting services including independent evaluation of the environmental improvement effects of proposed projects and assessing borrowers’ transition strategies toward decarbonization. Since various projects aiming to achieve Green Transformation (GX) have been implemented in recent years, we also provide comprehensive due diligence services such as Technical Due Diligence and Environmental Due Diligence.
For further details, please refer to our service page, “ESG Support”.

Support for Environmental/Social Consideration in Investment and Financing
Support for Environmental and Social Risk Assessments
Evaluation of Financial Institutions’ Environmental and Social Review Frameworks and Implementation Status
Support for Human Rights Risk Assessments
Support for Climate Change Risk Assessments
Support for Evaluation of Environmental Effect (Green Effect) and ESG Factors

Many financial institutions in Japan and abroad conduct environmental and social risk assessments (called “environmental and social due diligence” or “verification of environmental and social considerations”) when providing investment or lending for large-scale projects executed in Japan or other countries. Financial institutions are required to assess projects’ environmental and social risks, giving attention to whether they satisfy international standards (such as the Equator Principles, the IFC’s performance standards, and the World Bank’s Environmental and Social Framework). Recently, their responsibilities have expanded to evaluate the level of contribution based on ESG factors within the context of sustainable finance. Over the years, we have built up a vast store of experience, scientific knowledge, and international good practices. Using this store, we support financial institutions to evaluate the effects and risks of their investment and lending.
For further details, please refer to our service page, “Support for Environmental/Social Consideration in Investment and Financing (Response to the Equator Principles, etc.)”.

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