December 2023
21Dec

How Japan’s aging population is shaping the future of nursing care

How will the aging population impact the provision and sustainability of care? We put the question to Dr Yukari Nakano, Executive Officer at the Japanese Nursing Association People are living longer than ever before, and though this is a positive sign of improvements to physical and social surroundings, many still spend their twilight years in poor health. Population aging also equates to a greater demand for long-term care and an expanded healthcare workforce capable of providing the specialized care many...

December 21, 2023
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08Dec

Japan’s SMBC pension fund explores boosting exposures to alternatives

Japan’s Sumitomo Mitsui Banking Corporation (SMBC) Pension Fund, managing assets worth 1 trillion yen ($6.6 billion), is poised to increase investments in illiquid alternatives, including infrastructure private equity and debt aimed at maximizing returns. Anticipating a shift in domestic interest rates with the expected exit of the Bank of Japan (BOJ) from its ultra-easy monetary policy, the pension fund is considering reassessing its longstanding strategy of investing Japanese government bonds (JGBs), which has comprised only about 1 per cent of...

December 8, 2023
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November 2023
17Nov

Japan to curb pension benefit increases for 2nd straight year

Japan is expected to curb the increase in national pension payouts for the second year in a row using an adjustment that reduces benefits when compared against rising consumer prices, Nikkei has learned. Benefits will grow by an estimated 2.6% in fiscal 2024, leaving recipients somewhat worse off after inflation. Public pension benefits in principle rise along with inflation and wage growth so that pensioners can maintain purchasing power. But the number of pensioners is swelling while the working population shrinks, putting strain on the...

November 17, 2023
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03Nov

Aging, Healthcare System, and Interest Rates

By Reona Hagiwara Over the past few decades, the Japanese economy has experienced the widening gap between returns on liquid bonds and illiquid capital (i.e., the liquidity premium) due to a secular decline in the real interest rate and a slight increase in the capital return. This paper explores the role of the health or medical expenditure risk in the increase in the premium, using a general equilibrium overlapping generations model with heterogeneous agents that differ in health status and...

November 3, 2023
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02Nov

World’s Largest Pension Fund Posts $4.5 Billion Quarterly Loss

Japan’s state pension fund, the world’s largest, posted a loss of ¥683.2 billion ($4.5 billion) on total assets during the three months through September as its holdings of domestic debt slumped by a record. The Government Pension Investment Fund lost 0.3% during the quarter, the fund said in Tokyo Thursday. Total assets rose slightly to ¥219.32 trillion due to a transfer of funds from the government’s account that manages its pension, according to a spokesperson. Domestic bonds lost 2.7%, the...

November 2, 2023
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October 2023
04Oct

Japanese pension funds with $600 billion to ink ESG pact

Japanese pension funds managing 90 trillion yen ($600 billion) will join a global initiative for responsible investment, Prime Minister Fumio Kishida said in a speech on Oct. 3. Seven of the nation's public retirement funds will start preparations to sign the Principles for Responsible Investment, Kishida said. The PRI was started by the United Nations in 2006 to encourage investment that takes environmental, social and governance factors into consideration. As the number of members has increased globally, Japanese firms have been...

October 4, 2023
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03Oct

Japan wants companies to disclose pension fund performance

Japan is moving to urge companies to disclose their pension plan returns, Nikkei has learned, as part of an effort to improve how the nation's retirement savings are invested. The government will begin discussions Wednesday in a new panel on strengthening Japan's asset management sector. Proposed topics include disclosures on pension fund performance, ways to attract more talent in the field and allowing smaller companies to operate joint pension funds. The conclusions will be incorporated into a national plan to bolster...

October 3, 2023
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02Oct

Japan government pension acts on population strain

Japan’s Government Pension Investment Fund — one of the world’s most powerful investors — is overhauling the way it chooses active managers, in a bid to secure the higher returns needed to support a rapidly ageing population. As its sheer size makes it harder to achieve above average performance, the world’s largest pension fund is leaning increasingly on data science to find those managers who can beat the market. “If asset owners can develop a scientific method for selecting active...

October 2, 2023
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September 2023
29Sep

Lessons From Japan And Italy On Managing The Aging Population

Japan and Italy are geographically distant and have evolved separately over the centuries, but they share several similar traits, including a rich culinary tradition, strong cultural values, breathtaking historical sites — and, more recently, an ageing population. More than one in 10 people in Japan are aged 80 or older. Beyond that, about 29 per cent of its 125 million people are 65 or older, the highest in the world ahead of Italy (24.5 per cent) and Finland (23.6 per...

September 29, 2023
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27Sep

Comparing ESG regulation globally remains elusive – report

Comparing global regulatory demands on ESG funds will continue to be elusive, according to a regulatory update from ISS ESG published Sept. 21. Experts at the Institutional Shareholder Services' sustainable investment arm reviewed current and proposed regulations in the European Union, U.K., U.S., Canada, Australia, Hong Kong, Singapore and Japan, and surmised "that navigating the emerging regimes will remain a challenge for the foreseeable future," the 2023 Global Regulatory Update said. It noted that two major sustainability reporting standards were finalized in 2023:...

September 27, 2023
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