Asia and Australia

Our Approach to Our Sustainability Themes

• Subsidiaries in Malaysia, Indonesia, and Australia will reduce the balance of credit extended to industries with high environmental impact by 50% through 2030 compared to 2020.
• We will support ESG initiatives among existing private equity investees in Greater China.

Business Activities and Sustainability Themes Matrix

Reduction of credit balances with high environmental impact

• #Investments and lending that take ESG into account
• #Climate change / Reducing GHG emissions

In the Asia and Australia segment, as we proceed with the reduction of credit balances in industries with high environmental impact, we are considering what criteria will be used to determine whether industries are subject to reduction.
Few of our customers in Asia are listed companies, so we make credit decisions based on financial statements we receive from customers. Therefore, we believe it is necessary for both ORIX and its customers to make appropriate decisions by using qualitative data rather than relying solely on quantitative data. For example, we are considering how to incorporate third-party standards such as government certification into the selection of credit balances, based on the ratio of customers’ sales to industries subject to reduction.
First, we are making standards that incorporate the situation and opinions on the ground in Asian countries.

Private equity investment that contributes to solving social issues

• #Investments and lending that take ESG into account
• #Climate change / Reducing GHG emissions

When making new investments, we make decisions based on the ORIX Sustainable Investing and Lending Policy, while considering environmental and social impacts.
In our private equity investments in Greater China (Mainland China, Hong Kong, and Taiwan), we invest in companies engaged in businesses that contribute to solving social issues, such as Beijing Energy International Holdings Co., Ltd. (solar power generation business) and China Water Affairs Group Limited (wastewater treatment business, etc.). Also, in order to develop environment-related technologies owned by our business-partner Japanese companies in China, we are expanding the scope of activities unique to ORIX, such as supporting the establishment of joint ventures with local companies (e.g., establishment of a joint venture for manufacturing and sales of drinking water treatment facilities in China by Toray Industries, Inc., China Water Affairs Group, and ORIX Group).
ESG initiatives conducted by existing investee companies will also lead to improvements in corporate value, and ORIX intends to be actively involved as an investor in a position to support the growth of these investees. First, we will collect information on the environmental initiatives of investees, then provide ORIX’s knowledge, such as by calculating CO₂ emissions data and formulating emissions reduction measures, then proceed with concrete details.

Solar power generation business in China

• #Climate change / Spreading and promoting renewable energy generation

ORIX has a stake in Beijing Energy International Holdings Co., Ltd., a clean energy platform. The company is primarily engaged in developing, investing, operating, and managing solar power plants and other renewable energy projects over 21 provinces in China. As of the end of December 2023, the company has an aggregate installed capacity of approximately 7.8GW; and the company aims to reach that of more than 15 GW by the end of the 14th five-year plan (from 2021 to 2025).
With the strategic support from its largest shareholder, the state-owned enterprise Beijing Energy Holding, Beijing Energy International is on the pace of getting deeply involved in the entire clean energy industry, including solar energy, wind energy, hydro energy, hydrogen energy, energy storage, and integrated energy management in China, as well as overseas new energy markets in Australia and Southeast Asian countries.
The Chinese government aims to bring the total installed capacity of wind and solar power to over 1,200 GW by 2030, reach carbon emissions peak before 2030, and achieve carbon neutrality before 2060. China has the world’s largest solar and wind power capacity, with 1,050 GW of installed capacity at the end of December 2023. With various support from the policy level, there has been an accelerated transformation of energy structure and rapid development of green energy in China.

Related Link

• Beijing Energy International Holdings Co., Ltd.