Sustainable Finance

The Norinchukin Bank Sustainable Finance

As a member of a cooperative organization supporting agriculture, fishery and forestry industries, the Norinchukin Bank understands that our businesses are part of the life, natural environment, and the affluent lives of community members sustained through these industries. As such, we aim to resolve environmental and social issues through sustainable finance.
We set a target ¥10 trillion in new finance between fiscal 2021 to 2030.

Sustainable finance includes loans originated through our group company the Norinchukin Trust & Banking Co., Ltd., external management contracts of ESG funds managed by Norinchukin Zenkyoren Asset Management Co., Ltd., as well as investment and finance through Norinchukin Australia Pty Limited and Norinchukin Bank Europe N.V.

GHG Measurement and Financial Support for Agricultural Corporations

The Bank entered into a Sustainability Linked Loan Agreement in December 2022 with Suzunari Inc., an agricultural corporation in Shizuoka Prefecture (the “Company,” below). The agreement targets reducing the Company Scope 1-2 GHG emissions. The Company measures GHG (Scope 1-3), with the help of the Bank and the CO₂ visualization, reduction, and reporting services of Asuene Inc.

Efforts to Achieve Stable Electricity Supply and Carbon Neutrality

In September 2023, the Bank, in cooperation with JA Bank members, concluded a syndicated loan agreement for a transition loan (unspecified use of funds) with Electric Power Development Co., Ltd. This is a syndicated transition loan in which JA Bank members form a syndicate, with Group company Norinchukin Trust & Banking Co.
Transition loans are a financing method that aims to support the efforts of companies to reduce GHG emissions based on the formulation of a long-term strategy to realize a decarbonized society. By setting Sustainability Performance Targets (SPTs) based on the borrower's business strategy and linking loan terms to the achievement of SPTs, the loan aims to motivate borrowers to achieve their goals and support sustainable business activities and growth.
This project will support our company's efforts to maintain a stable supply of electricity and achieve carbon neutrality by setting the SPTs as “J-POWER Group's domestic power generation business CO₂ emissions reduction target of 9.2 million tons by FY2025 and 22.5 million tons by FY2030 (-46% compared to FY13)”. By setting SPTs of “9.2 million tons by FY2030 (-46% from FY 2013),” we will support our efforts to maintain a stable electricity supply and achieve carbon neutrality.

Solving Climate Change Issues through Collaboration with Companies and Other Cooperatives

The Bank participates with Mitsubishi Estate Co. Ltd., (the “Company,” below) in a wide range of SDGs that work to improve the city, such as the Daimaruyu SDGs ACT5. Various companies collaborate in this act and promote SDG activities in the Otemachi, Marunouchi, and Yurakucho areas. The Bank deepens the conversation among executives and employees through such activities. As such, we entered into the Sustainability Linked Loan Agreement in October, 2022. This agreement sets SPTs that contribute to solving climate change issues (FY2025: 100% transition to renewable energy, FY2030: 70% reduction in Scope 1-2 emissions and 50% in Scope 3 compared to 2019)
The Bank will contribute to solving climate change issues by collaborating with companies and encouraging customer initiatives.

Chemical and Agrochemical Manufacturer Efforts to Reduce CO₂ Emissions

The Bank entered into a green loan agreement in January 2024 with Iharanikkei Chemical Industry Co., Ltd. ("Iharanikkei"). Iharanikkei supplies raw materials for use in pharmaceuticals, agrochemicals, dyes, resins, fibers, and other such products as a chemical manufacturer under the Kumiai Chemical Industry Group. These raw materials are mainly for use in chemical products derived from the chlorination of toluene and xylene.
The funded project aims to construct a new facility to burn waste (chlorinated organic compounds) generated in the manufacturing process, using thermal energy to generate steam and recover hydrochloric acid produced as a byproduct. This process allows Iharanikkei to use the generated steam as a heat source to help reduce CO₂ emissions from company plants.

Contributions to sustainable environments and society through investments

The Bank tackles the equity needs of customers to expand our finance tools for helping customers resolve their environmental and social issues. We contribute to a sustainable environment and society by returning investees’ initiatives and technologies to our customers and member organizations.

Topics

Business Alliances for Decarbonization and The Establishment of a New Company
- Excess Electricity Circulation Solar PPA* Service -

*Power Purchase Agreement

The Bank partnered with JA Mitsui Leasing, Ltd., ("JA Mitsui Leasing,” below), JA Mitsui Energy Solutions, Ltd., iGrid Solutions, Ltd., and VPP Japan, Ltd., to establish the Circular Green Energy LLC (the "Company").
In addition to providing on-site consumption services for solar power generation facilities, the Company began offering the Excess Electricity Circulation Solar PPA Service. This service effectively utilizes the excess energy generated by such facilities. Users of this service can install solar power for their own consumption with no maintenance or initial investment allowing users to reduce GHG emissions and power costs, procure stable power, and have access to emergency power sources. The Bank will work towards decarbonatization through the installation of these systems on the roofs of buildings owned by customers of JA Mitsui Leasing or the Bank, and affiliate organizations such as JA.
The Company entered into a Power Purchase Agreement (PPA) with JA Zen-Noh Meat Foods Co., Ltd. in November 2023, resolving to install a solar power generation system on the roof of the Takasaki Ham Plant for in-house energy consumption.

Green Procurement Initiatives

Issuance of Green Bonds

The Bank issues U.S. dollar-denominated Norinchukin Bank debentures as green bonds in overseas markets. Norinchukin Bank debentures are bonds authorized to be issued under the Norinchukin Bank Act to raise funds for the Bank.
This is the first green bond issuarance for the Bank and limits the use of proceeds to investments and loans for projects that help improve the environment, such as renewable energy projects. Prior to issuance, we developed the Green Bond Framework to ensure compliance with the Green Bond Principles 2021 of International Capital Markets Association (ICMA).
We will contribute to the creation of a sustainable environment and society through the issuance of green bonds and the investment and finance of the proceeds.