Providing Analysis/Proposals on the Economy, Society, and Investment Information
Daiwa Securities Group as an integrated securities group provides, in addition to investment information, a wide range of information on the economy and society. We hope that the measures we propose from a long-term perspective will be helpful to customers, investors and a variety of stakeholders.
Easy-to-Understand Communication of Information
Daiwa Securities publishes information for a wide range of people from institutional and retail investors to those who are about to start investing. The central role in the provision of information is played by highly specialized analysts and strategists from the Investment Strategy, Equity Research, and Fixed Income, Currency and Commodities (FICC) Research Departments. They provide information mainly through reports based on their unique analysis. Our information is based on close collection and analysis of data. Even if the same person is providing that information, we tailor the presentation, depending on whether it is for retail investors or institutional investors, who are investment professionals.
For example, if information is targeted at retail investors, we implement various measures to make it more visually understandable. To remove the general perception that securities investment or securities companies are complicated, we believe it is one of our missions to work toward communicating our analysis using easy-to-understand language.
Initiatives to Provide Information on ESG (Daiwa Securities)
Daiwa Securities' Equity Research Department is a group of analysts and strategists. They analyze and evaluate information released by companies, and provide stock price information and investment strategies and ideas to institutional investors (such as asset management companies, banks, insurance companies, pension funds).
International agendas, such as SDGs and the Paris Agreement, have gained much attention in recent years. Against this backdrop, a growing number of investors are using nonfinancial information in relation to the environment, society, and corporate governance when making medium to long term investment decisions. Therefore, in May 2019, Daiwa Securities established ESG Research Division, which specializes in handling ESG information, within the Equity Research Department, thereby putting in place a system for comprehensively analyzing and evaluating financial and nonfinancial information. The ESG Research Section works on writing analysis reports focusing on topics such as climate change, human rights and gender issues, corporate governance systems, and social impact, as well as holding ESG seminars and other activities.
ESG information will become more and more important for companies and society as a whole for achieving sustainable growth over the long term. We strive to provide appropriate ESG information in a timely manner so that institutional investors will be able to expand their investment returns in the medium to long term through responsible investment and purposeful dialogue (engagement).
Number of SDGs/ESG seminars held & participants
- 2020: 23 (2,461 participants)
- 2019: 18 (699 participants)
- 2018: 15 (447 participants)
- 2017: 12 (412 participants)
ESG reporting rate (individual corporate reports) as of end of FY2020: 87.4%
Initiatives by Daiwa Institute of Research
Comprehensive Provision of Information and Policy Proposal Activities
Daiwa Institute of Research (DIR), which assumes the think-tank role of Daiwa Securities Group, provides wide-ranging analysis and information to the public. At DIR, we consider it our mission to engage in comprehensive provision of information and policy proposal activities concerning the financial and capital markets and the real economy. We have always sought to provide up-to-date and in-depth information and a unique viewpoint that has not been presented by others. In order to provide information that satisfies the needs of the public, we also exchange information and hold discussions with businesses, investors, public institutions including governments and municipalities, and various economic groups, as well as overseas think-tanks and media. In this way, we are able to analyze the currents and trends of society and disseminate information.
We are also stepping up the release of ESG information, communicating wide-ranging information via our website and "DIR Research Quarterly Review" (our quarterly journal) regarding community vitalization, environmental problems, women's active participation in society, workstyle reform, corporate governance and other issues.
Provision of information by DIR through diverse media
- Number of reports posted on the website : 554 reports (Results for FY2020)
- Full texts of reports available on the website
- Number of recent hits on the research division's page : 5.27 million hits (Results for FY2020)
Focus on Information Dissemination with a View toward the Post-COVID Era
The Research Division of DIR conducts research, analysis, and dissemination of information centered on topics relating to domestic and overseas macro-economics and financial and capital markets. In response to the spread of COVID-19 in particular, the division has focused on analysis and information dissemination concerning the future of the global economy and societies, which have been subjected to historical impacts.
The division set the path to recovery by the Japanese economy, issues and the future of financial and capital markets, and the pursuit of sustainability as the basis for areas of medium- to long-term focus and selected individual themes to address. Among them, topics for priority measures are expected to include the SDG/ESG, zero emissions, digital transformation (DX), and household asset formation. The Office of SDGs Research & Consulting was established in FY2019 with the aim of contributing to society through the dissemination of information intended to solve various issues. In FY 2020, the office published 18 reports and made 75 visits to finance and nonfinancial companies for the provision of information. In addition, the Consulting Division is working on enhancing corporate value for achieving the SDGs with a focus on sound management and human capital.
During the COVID-19 pandemic, the Consulting Division has provided information from a corporate management perspective on various issues that companies are directly facing such as medium-term management planning, human resource strategies, DX, information disclosure and shareholder responses (including investor relations and corporate governance), and responses to environmental issues.
Economic Analysis Initiatives Using AI
DIR has been releasing the Daiwa Regional AI (Regional Love) Index, which uses artificial intelligence (AI) to calculate economic sentiment by region, since July 2017 to contribute to the development of regional society.
Japan is faced with the important issue of breaking the vicious cycle of population decline and contraction of regional economies to realize regional revitalization. To promote such regional revitalization, it is necessary to properly understand the current state of regional economies, in addition to executing the policies that suit regional characteristics.
The Daiwa Regional AI (Regional Love) Index utilizes a state-of-the-art artificial intelligence (AI) model and also incorporates economists' knowledge to calculate overall economic sentiment by region. It has the following advantages:
- 1.demonstrating overall economic sentiment quantitatively and promptly by region;
- 2.grasping regional economic sentiment in a historical manner; and
- 3.enabling analysis of which fields (such as "consumption" and "exports") provide impact and cause changes in overall economic sentiment.
DIR also uses AI to analyze business conditions and regional economies. For example, it makes AI-based economic index forecasts and has developed a model enabling regional economies to be quickly understood by using alternative data (electricity volume demand data announced every day on the websites of power companies), which was rarely used for economic analysis in the past.
Provision of Information through Diverse Media
Lectures and Media Appearances
The Research Division of DIR adopts a variety of methods for providing information. These include the writing of reports; contribution to DIR Research Quarterly Review, newspapers and economic magazines; media interviews; TV appearances; lectures, seminars, and presentations at workshops; the publication of books, and participation in government councils as members. We strive to explain in an easy to understand way complex issues related to the economy, society, and policy issues within and outside Japan, while emphasizing the quality of reports. We ensure the reliability of our reports by requiring them to undergo review by a specialized section. As a result, the information we provide has improved in both quality and quantity, and we are communicating with customers on a continuously increasing number of occasions.
Issuing of Books and Booklets
The Investment Strategy Department of Daiwa Securities issues the periodical "Daiwa Investment Monthly" and other publications as tools for communicating information to general customers. They are distributed to sales branches of Daiwa Securities and are also available on the Internet. "Daiwa Investment Monthly" videos can also be viewed with a smartphone. We are further evolving our booklets to make them easier to understand.
We also provide information in various ways to general customers, including books available through publishers, desk calendars with information on financial events, and wall-hanging market charts.
Daiwa Securities Group regularly holds webinars where popular strategists and analysts of the Group appear as lecturers. These webinars can be viewed in real-time and participants can pose questions directly to the lecturers using a chat function, enabling numerous customers to receive market information and commentary on individual stocks through live seminars. Videos of some of the webinars are available for subsequent viewing, enabling customers to watch the webinars according to their individual lifestyles.
In FY2020, approximately 20,000 customers participated in these webinars.
We will continue our efforts to communicate market conditions and outlook and other information to even more people in a way that is easy to understand through our webinars.
Daiwa Internet TV
In 2000, Daiwa Securities Group began “Daiwa Securities Information TV,” Japan’s only channel dedicated to securities information, on the multichannel pay TV broadcast service “SKY Perfect TV!” Since April 2011, we have been producing “Daiwa Internet TV” at our own studio and distributing it online in an effort to target a wider range of viewers. We distribute information on the Tokyo market five times a day in a timely manner, while providing local market information from Hong Kong and New York every day.
In addition to these daily programs, we distribute corporate information as well as video reports where analysts and economists at Daiwa Securities and DIR provide commentaries on current issues in an easy-to-understand way.
On a new program called “Take Note! SDG/ESG Investment will Change the World” that was launched in July 2020, Daiwa Securities strategists provide straightforward explanations of SDG/ESG investment.
Our Daiwa Internet TV initiative was introduced by the SDG Industry Matrix for Financial Services (issued jointly by the United Nations Global Compact and KPMG International in 2015) as a case for Goal 4 "Quality Education." The report highlighted Daiwa's timely and free of charge provision of a variety of financial and investment information.
We will continue to make efforts to produce programs that can be viewed by not only investors but also those who are new to investment, and that can support the journey from savings to asset building.
Daiwa Asset Management
Daiwa Asset Management posts “Tweets by Tsumitate Wa-NISA” on its website as educational content for NISA in an effort to distribute information in an approachable, easy-to-understand way in collaboration with “Tsumitate Wa-NISA,” the Financial Services Agency’s official character of the installment-type NISA. The company recognizes that providing information to investors through the Internet will become more important with the spread of COVID-19, and distributes, as website content, market information videos that focus on the U.S. and REIT markets, in addition to the Fund Letters and Market Letters that have previously been distributed.
As a signatory to the United Nations Principles for Responsible Investment (PRI), Daiwa Asset Management plans to present information on its ESG investment related initiatives to domestic and overseas asset owners, investment managers, and others as a bronze sponsor of the PRI Digital Conference that will be held in October 2021. The company actively disseminates information on its ESG investment initiatives as an asset management company and in FY2020 engaged in a variety of activities including publishing an article in the Securities Analysts Journal and presenting at an online seminar of the NIKKEI ESG Management Forum held by The Nikkei and at a symposium on a project for considering the future of asset management companies. In the future, the company will continue to disseminate information on its own ESG investment knowledge and initiatives both inside and outside the industry.