As mentioned in the first and second featured articles, sustainable finance has been expanding rapidly in recent years worldwide. World ESG investment balances, for example, increased 34% from 2016 to 2018, with green bond issue reaching $258.9 billion in 2019, a 51% increase over the previous year. Even in 2020, when the world was hit by the COVID-19 pandemic, interest in sustainable finance increased further. As described in the third article, "green recovery" and "sustainable recovery" have become keywords for economic recovery from COVID-19,

In Japan, 2020 was also a year of negative growth due to the COVID-19 pandemic, however it was an important year for sustainability. In fact, the government has implemented a full-fledged decarbonization policy. At the end of October 2020, Prime Minister Suga declared that Japan will go carbon neutral by 2050, and on December 25, the " Green Growth Strategy towards 2050 Carbon Neutrality" was announced. The strategy aims to achieve carbon neutrality by 2050 through industry, economy and society reforms. The strategy defines a concrete action plans and a series of key priorities. Decarbonization not only positively impacts the environment but is also an opportunity for economic growth of around190 trillion yen in 2050. However, the strategy will have a very large impact on the industry due to the need for fundamental reforms and technological innovations. In 2020 Japan's decarbonization strategy was announced, but from 2021 we expect an acceleration of efforts towards the low carbon transition.

In the strategy, "finance" is cited as one of the key cross-sectoral policy measures (see chart below) alongside "budget," "tax system," "regulatory reform and standardization," and "international collaboration". In addition, in terms of the "tax system," measures to stimulate private investment toward decarbonization are under consideration, and sustainable finance is expected to play an important role. These monetary policies are based on the "Climate Innovation Finance Strategy 2020" announced by METI (Ministry of Economy, Trade and Industry) in September 2020. In order to achieve the objectives of SDGs and the Paris Agreement, it is important to simultaneously promote finance for low carbon transition, renewable energy and innovation. In the Green Growth Strategy, financial measures are under consideration from these three perspectives. It also includes a policy for the incorporation of ESG funding for carbon neutrality, including an environmental financing target of approximately 30 trillion yen for the in three Japanese mega banks, utilizing ESG-related private-sector funds.

We have covered decarbonization efforts above, but the need of funding for social issues is also growing due to the COVID-19 pandemic. According to the United Nations Global Compact, in 2020 more than US$100 billion in social and sustainable bonds were issued globally, with a large amount of funds financing COVID-19 related investments（iii） . In 2020, the issuance of domestic Green Bonds and Sustainability Bonds showed a particularly marked growth in the issuance of sustainability bonds that contributed to resolve not only environmental issues but also social issues.