ESG: FAQ from investor meetings in Europe and the US

Research evidence excerpt

ESG: FAQ from investor meetings in Europe and the US

ESG: FAQ from investor meetings in Europe and Global Markets Research

the US 29 June 2026

EQUITY: JAPAN ESG

Research Analysts

Focus on cash allocation disclosure Japan ESG research

Kazuya Nakagawa - NSC

kazuya.nakagawa@nomura.com

Many questions on the GX-ETS, which became fully operational in FY26 +81 3 6703 1184

Investor FAQs from meetings in four cities in Europe and the US

We visited London, Zurich and Lausanne in Switzerland, and New York from June 22 to

26. We had the opportunity to discuss with investors progress made on corporate

governance reform by governments and companies, as well as environmental (E) and

social (S) initiatives undertaken by the public and private sectors. Herein, we summarize

questions raised by investors during our meetings in Europe and the US.

Focus on cash allocation and the slow pace of strategic shareholding reduction

Investor sentiment regarding the proposed revisions to the Corporate Governance Code

(CG Code), released in April 2026, was generally negative. The main reasons cited for

this negative view were (1) in the latest revision of the CG Code, the statement on the

effective utilization of financial assets such as cash and real assets for growth investments

was included in the interpretive guidance, which falls outside the scope of the newly

established comply-or-explain framework, and (2) certain provisions relating to the

protection of minority shareholders were reclassified from principles to interpretive

guidance. Conversely, some investors took a positive view of the greater emphasis placed

on growth investments in the CG Code and of the Japanese stock market increasingly

favoring companies making investments in growth, including AI-related investments.