A climate advocacy organisation is calling upon investors in Japan’s three largest banks and three trading firms to vote against board members for failing to recognise and manage the risks posed by investments in fossil fuel production.
Environmental advocacy group Market Forces is arguing that directors are failing to oversee material financial risks to the banks and trading houses’ businesses, according to presentations seen by Reuters.
It made the presentations to institutional investors in banks Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group, Mizuho Financial Group, and trading houses Mitsubishi Corp, Mitsui & Co and Sumitomo Corp.
It was not immediately clear how receptive the investors in the companies were to the presentations.
Mitsubishi Corp said it is aware of the presentation and will first review the details. MUFG said it received the presentation but declined to comment. The other companies did not respond to a request for comment.
The campaign marks a shift in Australia-based Market Forces’ strategy from submitting shareholder proposals previously towards opposing director reappointments at the firms’ annual general meetings this year.
The group aims to prevent investment in projects that would harm the environment and cause global warming.
Shareholder activism on climate change has gained momentum in Japan since 2020, when Mizuho became the first listed company to face a climate-related vote. While no climate resolutions have yet passed, the pressure has prompted some policy changes at companies.
Starting in 2020, Market Forces has submitted shareholder proposals to Japanese banks, trading houses and utilities firms, calling for climate transition plans and governance changes.
Previous proposals have reached up to 35% support. However, in 2025 shareholder support dropped to between 3.5% and 15%. Market Forces has investments in each of the banks and trading houses.
The presentations also argue the war in Iran has highlighted the fragility of investments in fossil fuel industries, which now face disrupted supply chains and wild price volatility.
The risks cited include Japan’s megabanks facing credit losses and heightened systemic risk from climate change that are exacerbated by fossil fuel projects they finance, while the closure of the Strait of Hormuz has highlighted that assets across the LNG supply chain risk becoming stranded.
Japan relies on the Middle East for around 95% of its oil supplies and 11% of its liquefied natural gas imports. Almost all of the country’s crude oil barrels and 6% of its LNG come via the Strait of Hormuz.
Reuters
