「How will mandatory sustainability disclosure affect Japanese companies?」、「What measures should companies take to disclose sustainability information in accordance with the SSBJ standards?In the article, we explained the impact of the SSBJ standards on companies (target companies, application schedule, disclosure items) and the necessary countermeasures.
This article explains how to view sustainability promotion not merely as a regulatory compliance issue, but as a management challenge that can lead to corporate growth.
Current state of sustainability data utilization
In recent years, as the business environment has become increasingly complex, investors have been paying attention to sustainability-related data (ESG investing) as a way to connect it to sustainable business growth. On the other hand, many companies are currently only collecting data for disclosure purposes and are not fully utilizing it for business growth.
Investor expectations of companies
Sustainability-related information is categorized as non-financial information, but it is often referred to as "future financial information," and ESG indicators (Environmental, Social, and Governance) are used when evaluating long-term corporate value. According to a report by the Ministry of Economy, Trade and Industry, investors are increasingly prioritizing ESG indicators as key management indicators.
Recognition of challenges in the use of sustainability data in companies
In a climate where investors place importance on ESG indicators, we investigated how companies are actually utilizing sustainability data in their management. The following survey revealed that the majority of companies responded that they "cannot use it in management decision-making" or "cannot use it in their operations," suggesting that many companies are only collecting data for disclosure purposes.
Source: Deloitte Tohmatsu Group ESG Data Collection and Disclosure Survey 2022
Concepts for promoting sustainability management
Sustainability Transformation (SX) is
To promote sustainability not merely as a response to regulations, but as a means of driving corporate growth and advancing it as sustainable management, it is crucial to view societal issues (social sustainability) as management issues (corporate sustainability) and to provide value to stakeholders in the long term. To achieve this, business transformation from an ESG (Environmental, Social, and Governance) perspective is necessary. In the Ito Report 3.0, this type of business transformation is proposed as Sustainability Transformation (SX).
Data utilization system for achieving SX
To connect sustainability initiatives to increased corporate value, it is necessary to develop management strategies utilizing ESG data and regularly monitor progress. To this end, it is crucial for headquarters staff organizations in the sustainability and IT departments to establish systems and other mechanisms, and then to drive business transformation (SX realization) by assigning missions to business units as KPIs.
summary
There is a gap between investors' perspectives on the use of sustainability data and how companies actually utilize it. It is crucial for companies to go beyond simply complying with information disclosure requirements and instead use sustainability data in management indicators and KPIs to drive business transformation and achieve genuine growth. By promoting Sustainability (SX) among Japanese companies, this should strengthen their global competitiveness.
Sustainability 2026 Issue
With the mandatory disclosure requirement coming into full effect in the fiscal year ending March 2027, companies should seize this as an opportunity to implement highly agile management reforms that leverage sustainability data. A crucial turning point for companies will be whether they can establish a data infrastructure, including suppliers, and a system for promoting Sustainability Transformation (SX) by 2026.
Sustainability 2026 Issue: "Making Japan a Leading Nation in SX" Project
Related Pages
Please also read the related pages for this explanation.
This is for those who want to know which companies are subject to SSBJ regulations, when they will be applied, and what disclosure items they should disclose.
Mandatory Sustainability Information Disclosure: Planned Measures, Targets, and Impacts Explained
For those who want to know about measures to address the SSBJ regulations.
What are SSBJ standards? An explanation of the requirements for sustainability disclosure.
This is for those who want to know how to calculate greenhouse gas emissions (CO2 emissions, etc.).
How are CO2 emissions calculated?
This is for those who want to know about the process of third-party assurance for greenhouse gas emissions (CO2 emissions, etc.).