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Information contained in this news release is current as of the date of the press announcement, but may be subject to change without prior notice.
November 16, 2023
Tokyo, November 16, 2023 – Hitachi, Ltd. ("Hitachi"), JPX Market Innovation & Research, Inc. ("JPXI"), Nomura Securities Co., Ltd. ("Nomura"), and BOOSTRY Co., Ltd. ("BOOSTRY"), are cooperating with Hitachi toward its issuance of a "Digitally Tracked Green Bond" ("digital green bond") utilizing digital technologies such as IoT and a blockchain platform. The terms of issuance shall be announced once they have been decided.
The digital green bond is a bond aimed at utilizing digital technologies to improve the transparency of data needed for green investment and the efficacy of gathering that data. The bond will have a corporate bond-type security tokens ("digital bond") scheme that utilizes a Green Tracking Hub jointly developed by Hitachi and JPXI allowing investors to easily view the bond's environmental effect, and a blockchain provided by BOOSTRY. In addition, the digital green bond is the second issuance in Japan, following Japan Exchange Group, Inc.
The four companies will continue to promote the issuance of digital green bonds following this issuance by Hitachi, and by making these bonds available to a wide range of issuers and investors, contribute to carbon neutrality in society.
Illustration of the digital green bond scheme
Hitachi plans to allocate the funds raised through the issuance of the digital green bond as its effort to achieve carbon neutrality by FY2030 at business sites (factories and offices) to refinance expenditures of the construction and refurbishment of Kyoso-to of the Central Research Laboratory (energy saving building), which was completed in March 2019 and achieved carbon neutrality in FY2021.
The digital bond will be issued and administered through a consortium-type blockchain network, "ibet for Fin"*1, led by BOOSTRY, instead of the normal book-entry transfer by the Japan Securities Depository Center. Operational processes will be completed electronically, from issuance to administration during the bond's term and redemption. Using ibet for Fin will enable the management of a bond registry as well as allowing issuers to keep track of bond holders on an ongoing basis, which is difficult with conventional bonds.
To raise the transparency of the use of proceeds raised through the digital green bond, Hitachi will utilize the Green Tracking Hub jointly developed by Hitachi and JPXI that automatically measures the volume of electricity consumed at the buildings, to which funds were allocated, and converts the volume into a comparison of volume of CO2 avoided emissions and energy reduction versus benchmarks, and discloses this data to investors. By enabling monitoring by investors at any time, Hitachi aims for transparency on a higher level than just annual reporting. In addition, sharing data with BOOSTRY and recording the energy reduction and CO2 avoided emissions on ibet for Fin will enhance data transparency and timeliness.
In addition to collecting data from previous renewable energy facilities, the Green Tracking Hub will collect data from the building to which funds from this bond will be allocated. Hitachi plans to continually expand its green assets subject to data collection going forward.
Furthermore, Hitachi plans to leverage the Green Tracking Hub's mechanism to improve transparency of environmental effect of green projects to expand its usage to cover automation of the issuance and authentication of carbon credits, support for carbon offsetting by business corporations, and more.
The four companies will cooperate as below while aiming to contribute to carbon neutrality in society as a whole by sharing lessons learned from and issues identified during this initiative.
Hitachi drives Social Innovation Business, creating a sustainable society through the use of data and technology. We solve customers' and society's challenges with Lumada solutions leveraging IT, OT (Operational Technology) and products. Hitachi operates under the business structure of "Digital Systems & Services" - supporting our customers' digital transformation; "Green Energy & Mobility" - contributing to a decarbonized society through energy and railway systems, and "Connective Industries" - connecting products through digital technology to provide solutions in various industries. Driven by Digital, Green, and Innovation, we aim for growth through co-creation with our customers. The company's consolidated revenues for fiscal year 2022 (ended March 31, 2023) totaled 10,881.1 billion yen, with 696 consolidated subsidiaries and approximately 320,000 employees worldwide. For more information on Hitachi, please visit the company's website at https://www.hitachi.com.
JPX Market Innovation & Research was established as a new subsidiary of Japan Exchange Group, Inc. to stand alongside its exchange, regulatory, and clearing entities, and started business on April 1, 2022. It aims to create market services to improve the functionality and efficiency of the overall financial instruments market. JPX Market Innovation & Research goes beyond the bounds of traditional financial instruments exchanges to aim for flexible and agile business development leveraging M&As, industry-leading talent, and more, enhance digital business and network business using data and technology, and promote the diversification of business and improvement of services.
For more information on Japan Exchange Group, please visit the company's website at https://www.jpx.co.jp/english/corporate/
Nomura is a global financial services group with an integrated network spanning approximately 30 countries and regions. By connecting markets East & West, Nomura services the needs of individuals, institutions, corporates and governments through its three business divisions: Retail, Investment Management, and Wholesale (Global Markets and Investment Banking). Founded in 1925, the firm is built on a tradition of disciplined entrepreneurship, serving clients with creative solutions and considered thought leadership. For further information about Nomura, visit www.nomura.com.
Based on its mission of "connecting challengers and supporters by making all rights transferrable and usable" BOOSTRY provides various IT services to enable the distribution of rights. BOOSTRY leads in the development of "ibet for Fin," Japan's only consortium-based blockchain platform freely usable by various financial institutions in the capital market. BOOSTRY aims to expand the existing capital market by forming a security token ecosystem with a platform that cannot be monopolized by it or any other business. For details, please view BOOSTRY's website (Japanese only) (https://boostry.co.jp/).
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