KATAGIRI Interest is increasing but when we make an investment decision ESG does not play a part – we just look at the investment itself. Having said this, we do look at ESG scores and ratings. But we use them as a tool in scenario analysis for stress tests, rather than being embedded in our internal rating scheme.

ISHIDE There has been more issuance of green and social bonds over the last few years. However, like many other investors we don’t segregate ESG bonds from others – we don’t look at them separately. For example, the MUFG Group deal done this week was a green bond, but we viewed it simply as a corporate bond.

Companies want to make a greater contribution to society and be more respectful of the environment. In this sense, when we make an investment we screen its potential based on ESG scoring. This is one of the investment criteria we look at.

SETA If the spread is the same we would choose an ESG investment.

IMADE We don’t place any particular focus on ESG bonds per se but the fact that there has been more issuance is a good development. As an investor we maintain a lot of interest in how proceeds are used – especially whether it is for environmental or social purposes. We look with interest at what the money we invest is being used for.

FUND MANAGER 1 We have only just started discussing ESG within our company.

YOSHIZAKI In our case, we view ESG as crucial at the asset-management level. Our bank has also issued green bonds and provides ESG loans to corporate clients. ESG is a key screening criterion in project financing, to determine whether or not to proceed with a deal.

On the other hand, on the investment side we are still way behind. ESG is not yet part of the investment decision-making process. We are still very cautious but we are very keen to take a deeper look at this.

TAKEI Our investments are confined to government, semi-government and global supranational, sovereign and agency issuers. As these issuers are public institutions, they are essentially ESG by their nature. The yield we get from their ESG bonds is no different from that from their conventional bonds.

We are required to benchmark for absolute return. This means we don’t distinguish between ESG and other bonds

One concern I have, though, is around liquidity when it comes to ESG bonds. Some investors won’t sell these bonds when they have bought them under an ESG mandate, which means there is more liquidity risk in ESG bonds. As a result, I actually prefer conventional bonds.

DOMOTO We have not changed our stance from a year ago. We are interested in ESG but we have not yet established any ESG investment criteria. We will look at all kinds of bonds – whether ESG or not – and evaluate the merit of each.

FUND MANAGER 2 Because we are an asset-management company we manage assets of others. We are seeing more requests from clients to look at ESG. As a result, we have established internal criteria and we are looking closely at ESG.

ITOH We do not have investment criteria for ESG. We invest in collateralised loan obligations and in the documentation of some of these is reference to embedding ESG, which could lead to a potential increase in engagement in that area. We will continue to look at this carefully.