Japan’s $1.8 trillion pension fund considers impact investing, leading to changes in the country’s money management industry. The move is supported by the government to address real-world challenges, including an aging society and gender equality issues. GPIF President sees impact investing as key to economic and market growth.

Impact investing in Japan is expected to focus on climate, healthcare, and inclusivity, with GPIF likely to start with listed equities. The strategy targets profit alongside social and environmental outcomes, using standardized impact measurement frameworks like the UN’s Sustainable Development Goals.

GPIF is conducting research on impact investing, with no specific details on investment amounts or targets yet. Impact investing is gaining popularity in Europe, with ABP and PGGM planning significant investments. Globally, impact-related assets under management are estimated at $1.6 trillion, with Japan’s strategy growing 150% year-over-year.

The Japanese government is committed to meeting the UN’s Sustainable Development Goals through impact investing, fostering innovation and appealing to a younger investor generation. The approach allows investors to address issues not covered by traditional ESG methods, contributing to solving social and environmental challenges while enhancing business viability.

Read more at Yahoo Finance: World’s Biggest Pension Fund Puts Impact Investing on the Agenda