Message from the Chairman

With ongoing efforts to strengthen governance, DBJ contributes to sustainable growth through an innovative process of value creation.

With ongoing efforts to strengthen
governance, DBJ contributes to
sustainable growth through an innovative
process of value creation.

Creation of a Unique Business Model

The DBJ Group practices sustainability management in accordance with the Development Bank of Japan Inc. Act, balancing economic and social value with the aim of building a sustainable society. We supply risk capital to forward-looking initiatives through our Special Investment Operations program and collaborate and cooperate with private financial institutions to stimulate new flows of risk capital in Japan. DBJ’s investments and loans in new fields help strengthen Japan’s economic competitiveness. We also address local issues through risk capital supplied through joint funds created with regional financial institutions.

Furthermore, DBJ functions as an emergency supplier of capital for responses to natural disasters and other crises. In times of international financial turmoil, and following the Great East Japan Earthquake, the Kumamoto earthquakes, and other events calling for rapid influxes of capital, DBJ has been there to provide relief.

After the Japanese government declared the COVID-19 pandemic a crisis in March 2020, as a designated financial institution the DBJ Group concentrated on Crisis Response Operations to address the impacts of the pandemic.

In light of the requests being made by the government and the increasingly severely challenging business environment for companies during the persistent pandemic, we temporarily strengthened our support for businesses in sectors that have been hit hard by the pandemic, such as the hospitality sector.

While continuing to concentrate on Crisis Response Operations during the COVID-19 pandemic, DBJ will pursue innovative ways to provide financing from a customer perspective based on its GRIT Strategy, which sets out the priority fields the DBJ Group is focusing on under its Fifth Medium-Term Management Plan to realize a sustainable society in the future.

Governance Suited to Our Unique Business Model and Dialogue with Stakeholders

In order to continue playing this unique role, DBJ must have robust corporate governance, ensure transparency in management, and consider the opinions of outside experts. To realize this aim, we have created the Operations Audit Committee, the Compensation Committee, and the Personnel Evaluation Committee as advisory bodies to the Board of Directors. Listening to the views of our stakeholders is imperative to strengthening this framework.

It is essential that DBJ collaborate and cooperate with rather than compete with private financial institutions. We hold regular events for this purpose, usually twice a year, involving discussions with representatives of such institutions. We have also created the Special Investment Operations Monitoring Board as an advisory body to the Board of Directors. The board meets twice a year to discuss and evaluate the status of the Bank’s business performance, as well as its complementing and encouraging of private business and maintenance of non-competitive relationships.

The opinions we obtain both through our outreach to private financial institutions and through the outcomes of deliberations by the Special Investment Operations Monitoring Board are debated by the Advisory Board, an advisory body to the Board of Directors comprising outside experts and directors in fields including manufacturing, infrastructure, regional communities, and finance. The Advisory Board provides valuable ideas on matters concerning the safeguarding of proper competition with private financial institutions and the DBJ Group’s management plans. In my view, a distinct aspect of corporate governance at the DBJ Group is its continuous reassessment of its unique value creation process while engaging in dialogue with diverse stakeholders.

Living up to the trust placed in us by society, we want to keep our initiatives one step ahead of the times, especially in regard to the supply of risk capital, and this means ensuring that we operate in conformity with the Companies Act. For this purpose, the Board of Directors formulated the Basic Policy for Internal Control, which positions legal compliance, risk management, and internal audits as important subjects for management.

A Value Creation Process That Balances Economic and Social Value

Given the adoption of the Sustainable Development Goals (SDGs), the Paris Agreement, and other recent initiatives, the DBJ Group established the Sustainability Committee to deal with the growing need to review corporate management from a sustainability standpoint. In fiscal 2020, directors engaged in invigorating discussions about the DBJ Group’s initiatives related to the global agenda for ESG and building a sustainable society while recognizing the impact from the COVID-19 pandemic. These discussions were reflected in the formulation of the Fifth Medium-Term Management Plan. In fiscal 2021, we plan to discuss DBJ Group initiatives connected to the environment and society, including our approach to energy and climate change–related issues, from a medium- to long-term perspective.

To realize a sustainable society while balancing economic and social value, the DBJ Group offers solutions to issues faced by society and by our customers. The Group has continued to create innovative business models, centered on the supply of risk capital, in an effort to advance sustainability management and maintain a balanced value creation process. As the social significance of balancing these two types of value increases, we will continue making every effort to engage in dialogue with our diverse stakeholders and ensure robust and effective corporate governance, based on the notion that nothing is more important than embodying best practices that will continue to earn us the trust of our customers and society.

Yasushi Kinoshita

August 2021