Codo’s Insights

Codo’s Insights are a series of articles written by our team on topics we identify as strategic for our clients and partners. We cover developments across the Environmental, Social, and Governance (ESG) dimensions of corporate sustainability, with the aim of bringing strategic insights from around the world to companies operating in Japan.

Climate Change, Codo's Insights

Understanding Locked-In Emissions : Is your investment at risk of a carbon lock-in?

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When we think of solving climate change issues, we often focus on the emissions currently being produced. A carbon inventory or GHG emissions report can only detail the previous year(s)’ emissions. However, a significant portion of future emissions, however, is also already “locked-in” due to existing infrastructure, policies, and commitments. Understanding these locked-in emissions is critical if we are to effectively combat climate change. But what exactly are locked-in emissions, and why should we be concerned about them?

Codo's Insights

Equating Value across Borders: Carbon Credits and Japan’s Joint Crediting Mechanism (JCM) Explained

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The Japanese carbon market is gradually developing, taking a cautious approach compared to more established markets like those in Europe and the US. As Japan works towards its 2030 emission reduction targets, companies are increasingly engaging in carbon crediting and emissions trading. The Green Transformation – Emission Trading System (GX-ETS) and the Joint Crediting Mechanism (JCM) play pivotal roles in Japan’s carbon reduction efforts. JCM, in particular, allows Japanese companies to implement decarbonization projects in developing countries, generating carbon credits that contribute to Japan’s national targets. This article explores the intricacies of the JCM, the motivations for companies and partner countries, and the challenges and opportunities presented by this scheme

Benchmark Review, Codo's Insights

Climate plans in the heavy industries sector: how did Japanese firms perform in 2024?

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In the World Benchmarking Alliance’s first Heavy Industries Benchmark, the 91 most influential aluminium, cement and steel companies worldwide were assessed on their alignment to a low carbon world. The findings were consolidated into an insights report published in April 2024. In this blog post, we summarize the main findings and analyze how Japanese firms performed.

Codo's Insights, ESG Regulations

Fast Fashion in the Crosshairs: Will France’s Proposed Law Shake the Industry?

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Fast fashion has taken over consumers’ closets, leveraging low prices and speed. However, this affordability often conceals serious issues such as environmental impact and workers’ rights violations. In this article, we discuss a proposed fast fashion regulation law in France and explore what this new regulation might mean for the global fashion market, including Japan.

Codo's Insights, Renewable Energy

A review of METI’s GX Energy Plan

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Japan is facing a dilemma. Fifteen years ago, when Japan was the world’s greatest proponent of safe nuclear energy, Japan led the world with increasingly ambitious emission reduction targets long before the Paris Climate Accords pushed countries to achieve net zero carbon emissions by 2050. Scarcely more than a year following that commitment, however, expansion of nuclear power, and with it Japan’s most viable carbon neutral energy source, was taken off the table. After years of various investments and fears of grid instability, Japan’s renewable mix is still flagging behind other developed nations.

Codo's Insights, ESG Reporting

Demystifying Double Materiality: What is it and why does it matter?

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In the world of corporate finance and sustainability reporting, the concept of “double materiality” has gained increasing prominence in recent years. While the term may sound complex, its core principles are surprisingly straightforward. In this article, we will delve into the concept of double materiality, cutting through the jargon to reveal its significance and implications for your company.

Codo's Insights, ESG Reporting

Reporting Right: How to Choose a Sustainability Reporting Framework for your Organization  

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Reporting frameworks are established frameworks or guidelines that provide a structured and standardized approach for organizations and businesses to measure, disclose, and report their environmental, social, and governance (ESG) performance. In this blog post, we at Codo summarize the main environmental and sustainability reporting framework to help you choose the one most relevant for your organization.

Codo's Insights, ESG Regulations

The EU Green Taxonomy: An ambitious framework to redirect financial flows towards sustainability

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As the world grapples with the urgent need for sustainable practices, the European Union has spearheaded the development of the EU Green Taxonomy — an instrumental tool in promoting sustainable finance. Following the Green Deal passed in 2019, the regulation was adopted in June 2020 and entered into force in July 2021, with a roll-out plan in several phases. Codo summarizes the potential consequences it holds for Japanese companies operating in the global markets with input from Tatjana Gerling, an ESG Expert based in Europe. For our readers that are not familiar with the EU Green Taxonomy, we recommend checking out the annex at the bottom of the page where we introduce the fundamentals of the taxonomy.