The content of the "SMBC Group Statement on Sustainability" and its penetration throughout the company (September 5, 2019)

FY2019 Dialogue (1)
The content of the "SMBC Group Statement on Sustainability" and its penetration throughout the company (September 5, 2019)

Experts who participated in the dialogue

Participants from SMBC Group

SMBC Group finds it necessary to set long-term goals for society and the global environment toward achieving a sustainable society. We would like to receive some advice on the content of the "SMBC Group Statement on Sustainability " as our basic policy toward achieving a sustainable society and how to penetrate it into the company.

SMFG Suehiro

Our Group has held dialogues in relation to identify our materialities, etc., to obtain opinions from experts. In 2018, we held a dialogue on the theme of how we should perceive ESG/SDGs.
(Dialogue with Stakehold)

We have a Medium-Term Management Plan as our medium-term business goal. Currently, however, there is no long-term goal that looks at society and global environment. Since we will set the next Medium-Term Management Plan in the next fiscal year, we are considering to formulate the "SMBC Group Statement on Sustainability" as our basic policy toward achieving a sustainable society.

With regard to formulating the Statement, please provide us with some advice on its content and how to instill it into the company.

JRI Adachi

Our Group holds a conference of employees in charge of sustainability planning at Group companies once every few months to discuss related topics. For them, the theme of sustainability is their own affair, but for many other employees, it is somebody else's business. So the employees in charge of Group companies worry about how to get the employees to feel like they are involved in this theme. Please give us some advice on this point.

Q. Could you give us your honest opinion about the "SMBC Group Statement on Sustainability"?

Mr. Hatanaka

Honestly, I was surprised at the extensive history of Sumitomo and Mitsui which was described as the background of the "SMBC Group Statement on Sustainability"

Moreover, I can clearly see that many issues have been considered for the "three materiality (Environment, Community, and Next Generation)" consisting the Statement. I guess in formulating the Statement, you had trouble deciding what SMBC Group's "identity" is. I think that it is difficult to develop a consensus about the identity from the beginning, but that as you advance discussions, a consensus will be reached.

To cite our "Environmental Statement," the theme of environment was clear. However, after changing it to "sustainability," the theme seemed to be unclear.

As SMBC Group has a strong background represented by its 400-year history, you should first decide "what kind of society you will aim at from now" following the long history. After that, I think you will need to formulate a statement and set specific actions.

I got the impression that the course of action on sustainability includes many initiatives. One idea would be to make the course of action separate, rather than including it in the Statement.

Mr. Pedersen

The Statement has sufficient background and in-depth content. I felt the Group's attitude of placing emphasis on the environment, and that had a strong impression on me. However, I think this alone will be unsatisfactory in terms of content because there are no specific action plans.

I think you should go a step further. Specifically, along with the Statement, you need to show how you will transform the sustainability framework, including organizational aspects.

I think the keyword is "sustainable finance."

For a specific example of action, overseas companies list their initiatives in detail. Looking at SMBC Group's IR materials, it seemed that immediate social issues are just listed in the corresponding part of sustainability. I hope that you will make a strenuous effort to gather information and enhance the descriptions concerning your Group's specific actions. I think that going forward, it will be necessary to look at not only Japan, but also the world.

Q. Could you give us some advice on instilling the Sustainability Statement into the company?

Mr. Hatanaka

Although SMBC Group is a financial group, I think the business conditions and environment are different for each Group company. So it is necessary to instill the Statement into employees depending on each company's business condition.

If two companies are merged and each has a different history, their corporate culture is often different. On the other hand, I think sharing the idea of sustainability and ESG will lead to thinking of each company's position in society in a higher dimension. From this perspective, I feel that sustainability is a desirable theme that can be jointly considered.

Mr. Pedersen

In the world of sustainability, information and personal connections are crucial. It is important to focus on developing human resources for sustainability. However, I think it will be difficult to do this during the period of personnel rotation at a financial institution.

It is necessary to thoroughly disseminate the Statement throughout the company both in and outside Japan. To name a reference example, some companies provide training and workshops repeatedly.

Q. Could you give us a brief message?

Mr. Pedersen

I hope you will deeply consider the specific measures that you will take, including the content of the Sustainability Statement, and make the Statement stronger by clearly showing "what" and "how." I also hope that you will formulate the Statement using the backcasting approach, a method to think about social issues backward from the future.

If you stick to your "identity," it could lead to discussions of the past. I would like to ask you to face changes that are currently occurring and take initiatives with a unified force.

Mr. Hatanaka

What is probably needed in formulating the Statement is to be aware of what is cutting-edge in the world. I think it is important to determine what driver can lead by mixing "cutting-edge" with "identity."

Receiving opinions from experts