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1. Introduction

(1) Executive Summary

Daiwa Securities Group is advancing climate-related disclosures in pursuit of a decarbonized society. This report presents information on governance, strategy, risk management, and metrics and targets.

Governance
Supervision
  • The Board of Directors oversees a response to strategies and policies related to sustainability, including climate change.
  • The Board includes directors with expertise in sustainability, and in accordance with the rules of the Board of Directors, makes resolutions on items that are core management matters and items deemed important, including strategies and policies related to sustainability.
  • To further advance our sustainability initiatives, sustainability KPIs have been incorporated into the evaluation system for performance-linked remuneration, strengthening executives' incentives.
Execution
  • Sustainability Promotion Committee: Chaired by the President and CEO, it discusses strategies and policies related to sustainability, including climate change, and reports to the Board of Directors as necessary following discussion at the Executive Management Committee.
  • Group Risk Management Committee: Chaired by the President and CEO, it discusses policies and measures related to risk management, including climate change, under the Chief Risk Officer (CRO).
  • Group-wide Working Group: As a Group-wide system to promote sustainability, working groups (WG) have been established for the planning and implementation of sustainability-related business, the enhancement of information disclosure, and the strengthening of ESG responses.
Strategy
Climate-related Risks and Opportunities
  • Through analysis based on climate scenarios and interviews with each business division, we evaluate and prioritize climate-related risks and opportunities.
  • Main risks: deteriorating earnings from the underperformance of investees and managed companies during the transition to a decarbonized society, declining balances of assets under management, deterioration of the Group's reputation, and damage to business partners and Group sites from abnormal weather and wind and flood damage.
  • Main opportunities: increased sustainability-conscious investment opportunities, increased underwriting of financing, greater opportunities to provide new financial products, and improved reputation through proactive climate action.
Initiatives to Deal with Climate-related Risks and Opportunities
  • While appropriately addressing climate-related risks, we promote and strengthen sustainable finance; investment and management in ESG-conscious alternative assets such as real estate and solar power; and the provision of sustainability-conscious products and services, in order to link the opportunities associated with the transition to a carbon-neutral society to business growth.
  • We also reduce GHG emissions through renewable energy, strengthen stakeholder engagement, and participate in rule-making.
Resilience Assessment
  • Through scenario analysis, we monitor the financial impacts of climate change on the assets held by the Group.
  • We enhance our resilience while reducing uncertainty by executing our climate-related strategy.
Risk Management
Risk Management Framework
  • Climate-related risks are regarded as factors that can increase existing risks such as market risk and credit risk, and are considered within our existing risk management framework.
  • Climate change risk has been addressed in the Risk Appetite Statement since FY2021 and is appropriately identified, assessed, and effectively managed.
Environmental and Social Policy Framework
  • To strengthen the management of environmental and social risks, we have formulated the Environmental and Social Policy Framework, which defines prohibited and restricted businesses for new investments, loans, and underwriting.
  • For eligible projects with climate impact—such as coal-fired power generation, coal mining, oil and gas development, and biomass power generation—we implement ESG due diligence to determine whether or not to provide financing.
Metrics and Targets
Sustainability KPI
  • In conjunction with the Medium-Term Management Plan "Passion for the Best" 2026, we set GHG emissions (within our own operations*1 and within our investment and loan portfolio*2) as a Sustainability KPI (Group KPI) in FY2024.
GHG emissions within our own operations*1
  • Under the Net Zero Carbon Declaration, we are advancing initiatives to achieve net zero by FY2030.
  • In FY2024, we switched all domestic offices of Daiwa Securities and Daiwa Institute of Research to renewable energy.
Investment and Loan Portfolio emissions*2
  • Under the Net Zero Carbon Declaration, we are advancing initiatives to achieve net zero by 2050.
  • For project finance in the power generation sector—which accounts for the largest proportion of emissions—we have set interim targets up to FY2030. The FY2024 result declined from the FY2023 result, reflecting a decrease in investees' emissions and progress in renewable energy financing.
  • *1GHG emissions within our own operations are the total of Scope 1 and Scope 2.
  • *2Financed Emissions (Investment and Loan Portfolios) cover project finance in the power generation sector. Include some estimated values.

(2) FY2025 Highlights*1 (Group KPI)

GHG emissions within our
own operations*2

FY2030 Target*4
Net Zero
2,270t-CO2e

GHG emissions within
our investment and
loan portfolios*3

Interim Target for FY2030*4
186～255 g-CO2e/kWh
230g-CO2e/kWh

SDGs bond league table*5


FY2026 Target
In the top 2
1st
  • *1As of March 31, 2026.
  • *2GHG emissions within our own operations are the total of Scope 1 and Scope 2 (market-based). Preliminary figure as of June 2026; third-party assurance is scheduled to be obtained around August 2026. Excludes emissions from the use of company cars; including these, the total of Scope 1 and Scope 2 is 3,657 t-CO2e.
  • *3FY2024 result. Investment and Loan Portfolio emissions cover project finance in the power generation sector. Include some estimated values.
  • *4FY2030 (single year).
  • *5Scope: Straight bonds, Fiscal Investment and Loan Program Agency bonds, local government bonds, and Samurai Bonds issued for the purpose of resolving environmental and social issues in line with the context of the issuer's sustainability strategy (excludes the company's own bonds). Calculation methods: Prepared by Daiwa Securities based on LSEG Data & Analytics data.

Our History

The Group supports various related initiatives and continues to advance its climate-related efforts. In 2018, we became the first domestic securities company to endorse the TCFD recommendations, and we have published climate-related disclosures every year since.

2018
  • Established the SDGs Promotion Committee (currently the Sustainability Promotion Committee)
  • Endorsed the TCFD recommendations
2019
  • Joined the TCFD Consortium
  • Invested in Green Giraffe (Netherlands)
2020
  • Established a dedicated team for sustainable finance
  • Appointed the Head of SDGs (currently the Head of Sustainability)
  • Disclosed the results of scenario analysis
2021
  • Formulated the Vision 2030 management vision
  • Formulated the Environmental and Social Policy Framework
  • Published the Net Zero Carbon Declaration
  • Joined the PCAF
  • A director was appointed as a trustee of the IFRS Foundation
2022
  • An employee was appointed as a member of the SSBJ (Sustainability Standards Board of Japan)
2023
  • Selected as product design advisor for the Japan Climate Transition Bonds
  • Joined the GX League
  • Set interim targets for GHG emissions within our investment and loan portfolios, etc. (Scope 3)
  • Began climate-related disclosures in the Annual Securities Report
2024
  • Formulated the Medium-Term Management Plan "Passion for the Best" 2026
  • The March 2024 Annual Securities Report was featured in the FSA's "Compilation of Best Practices in Narrative Disclosure 2024"
  • Switched all domestic offices of Daiwa Securities and Daiwa Institute of Research to renewable energy
2025
  • Achieved the criteria for both energy saving and renewable energy (electricity) in the Tokyo Stock Exchange carbon credit market and received the Best Market Maker Award
  • Expanded the scope of aggregation of our own GHG emissions to align with the GHG Protocol
  • Added domestic renewable energy facilities to the scope of physical risk measurement
  • Disclosed natural capital and biodiversity information in line with the TNFD framework
2026
  • Narrowed down material climate-related risks and opportunities
  • Joined the GX Future League
  • Added overseas renewable energy facilities to the scope of physical risk measurement
  1. Home
  2. Sustainability
  3. Environment
  4. Climate-related Disclosures 2026
  5. 1. Introduction