Green Wind in the Stock Market - Environmental Ratings and the Rise of Eco-Funds (1999-2001)

Green Wind in the Stock Market - Environmental Ratings and the Rise of Eco-Funds (1999-2001)

In the late 1990s, Japanese companies began to view environmental responsiveness as a new competitive advantage as they sought to emerge from the recession that followed the bursting of the bubble economy. In particular, the 1997 Kyoto Protocol forced companies to respond to international global warming countermeasures and accelerated the introduction of environmental management systems. 1999 marked the start of a new era in Japan with the introduction of "environmental ratings," in which a company's environmental performance was subject to evaluation. In response, "eco-funds" were introduced. As of 2001, the total amount of funds reached approximately 120 billion yen, and the market has come to recognize environmental efforts as a "deviation value" of a company. This marked the beginning of a tectonic shift in environmental management, from CSR to competitive strategy.