Many firms and people in Japan still consider ESG a ¡°box-ticking exercise,¡± resulting in cases of greenwashing, according to former Goldman Sachs Japan vice chair Kathy Matsui.

¡°ESG isn¡¯t just a compliance exercise,¡± said Matsui, speaking to Bloomberg Television. ¡°I believe that many companies, many people still believe it¡¯s a box-ticking exercise, and hence we have seen greenwashing incidents here and there.¡±

Matsui is known for her ¡°Womenomics¡± research that explores the economic benefits of encouraging more female participation in the workforce. After stepping down from her post at Goldman in 2020, Matsui last year launched a venture capital fund that aims to invest $150 million (?16.5 billion) in sectors including health care, fintech, education and the environment.

While Prime Minister Fumio Kishida has highlighted green investment as a key part of his government agenda and pledged to double existing funding for green technology, Matsui said more needs to be done.

¡°Japan is very dependent on imported fossil fuels, but it has this very ambitious target at the same time to reach carbon neutrality by 2050,¡± said Matsui. ¡°You will not be able to get there if you don¡¯t invest in innovative technologies.¡±

Regarding Japan¡¯s energy imports, Matsui said Russia¡¯s invasion of Ukraine was causing headaches for Japanese companies.

¡°We¡¯ve already been seeing companies in the automobile sector or the technology sector either halt or pull back their presence in Russia for instance,¡± said Matsui. ¡°Japan is wholly reliant on imports for its fuel supplies, these fossil fuel supplies, so it always has to walk this delicate balance between geopolitical considerations but also economic realities.¡±