ESG

Canadian Solar Asset Management K.K. (“CSAM”) serves as an asset manager of Canadian Solar Infrastructure Fund, Inc. (“CSIF”) which invests mainly in renewable energy power generation facilities. Canadian Solar Project K.K. (“CSP”) is a developer of PV projects and a sponsor for CSIF. CSAM together with CSP has contributed to building a sustainable economic society in local regions while paying a great attention to the global environment. Thus, CSAM has run its asset management business with its focus on the environmental aspect among the ESG initiatives. In addition, CSAM fully recognizes that considering the social and governance aspects in the asset management operations is also deemed extremely important by investors and fund managers in Japan and overseas with a focus on SRI. Under such circumstances, CSAM believes that active, appropriate disclosure of information about its initiatives will be more important going forward; therefore, CSAM set forth its“Approach into UN PRI” as ESG basic policy late December of 2020.
CSAM has facilitated the “Contribution to the Global Environment” via an increased installment of renewable energy facilities in Japan since IPO of CSIF. Going forward, CSAM would like to make an opportunity for SRI available for investors by “Realizing A Sustainable Society” and “Vitalizing A Regional Society” as for the social and governance aspects.

As of August 13, 2019, our asset manager, Canadian Solar Asset Management K.K. (“CSAM”), became the first Japanese asset manager of a listed infrastructure fund to be a signatory to the UN PRI (United Nations supported Principles for Responsible Investment) to promote ESG (Environmental, Social, Governance) investments.
As a signatory to the UN PRI, CSAM devised an “Approach to UN PRI Guidelines” as of the end of December 2020 as its basic ESG policy, which can be found on CSIF’s website as of February 17, 2021.

• Since its establishment, CSIF has been practicing ESG-conscious management together with CSAM.
• CSAM recognized that in our business operations, the issue of climate change is an important management issue that can be a risk or an opportunity.
• CSAM signed the UN Principles for Responsible Investment in August 2019. CSIF endorsed the Climate-related Financial Disclosure Task Force recommendations in February 2022.
  CSIF and CSAM published the ESG report in February 2023.
• CSIF will select ESG subjects (materiality) of particular importance to CSIF and promote efforts to achieve and further improve targets by setting KPIs and implementing specific measures for materiality items through future activities.

• In response to the accelerating global decarbonization efforts, electricity consumers are increasingly looking for renewable energy sources for their own electricity procurement. CSIF has started to provide power consumer with tracking to provide power consumer with tracking information (renewable energy power Non-Fossil Certificates (Note)) for its CS Daisen-cho Power Plant (A), CS Daisen-cho Power Plant (B）, and CS Marumori-machi Power Plant.
• This trial can respond to the growing needs of electricity consumers for renewable energy, such as RE100 (Renewable Energy 100%), an international initiative that aims to procure 100% of the energy consumed by business activities from renewable energy sources.

(Note) FIT Non-Fossil Certificates are certificates that represent the renewable energy value of electricity purchased on a feed-in tariff under the FIT system and traded on the non-fuel value trading market of the Japan Electric Power Exchange (hereinafter referred to as “JPEX”).

• By executing the wholesale electricity supply agreement with Zero Watt Power Inc for CSIF’s power plants listed below, CSIF contributes to supply FIT electricity to consumers.
• CSIF has also begun purchasing clean electricity for power plant consumption. Clean electricity derived from renewable energy sources and FIT electricity to general households and companies that demand clean power from renewable energy sources, which will contribute to the diffusion of renewable energy. We believe that this will contribute to the spread of renewable energy and also to the generation of additional rental revenues.

TCFD is the Task Force on Climate-related Financial Disclosure established by the Financial Stability Board(FSB)at the request of the G20, which recommends “governance,” “strategy,” “risk management,” and “indicators and targets” for climate change-related information disclosure. CSIF has also disclosed TCFD related information.

• In order to prevent greenwashing (falsely claiming the sustainability of a particular product) and to create a more transparent playing field for ESG investors in their investment decision-making, EU SFDR was created for the purpose of enhancing transparency of sustainable investment.
• Disclosure covers all information relevant to policies on sustainability risk, sustainability of financial products, and ESG factors.
• CSIF is scheduled to conduct SFDR Article 8 disclosure requirements of pre-defined ESG (environmental, social, governance) factors.

On May 11, 2020, CSIF obtained Green 1 (F) rating, the highest overall rating in the JCR Green Finance evaluation, for the framework we established to limit the use of funds procured through green bonds and green loans to those with environmental improvement effects. 

• The Canadian Solar Group is focused on reducing the environmental impact from solar panel manufacturing processes such as greenhouse gases and manufacturing waste and water. (2017-2021)

• Greenhouse gas emissions

  ▲ 17 %

• Manufacturing water consumption

  ▲ 53 %

Power plant carefully developed by protecting the rich environment of Daisen-cho

The district in which CS Daisen-cho Power Plant is located is in close proximity to districts known for their diverse and rich ecological environments with forests, plants and wild birds. Efforts were made to refrain from using chainsaws when developing the project to avoid damaging the habitat of rare species of indigenous falcons, while painting the fence around the site using camouflage colors.
The power plant can provide 27MWp of clean regenerated energy, equivalent to electricity for approximately 8,000 households.

Canadian Solar Asset Management Inc. is sponsoring the Xavier‘s Way Walking in Hiji-machi, where CS Hiji-machi Power Plant and CS Hiji-machi Dai-Ni Power Plant are located. In 2022, CSAM employees participated in this event, which is a walk along a historic trail that Francisco Xavier is said to have passed through.

The Sponsor constructed the Daisen Canadian Garden and donated it to the Daisen-cho Town Government in commemoration of the completion of CS Daisen-cho Power Plant, now owned by the CSIF after development, and as part of its contribution to local communities in an effort to create harmony between nature and the large-scale solar power plant. In addition, it repaired the Hima Jinja Shrine in the same town and donated an incense holder made of white granite to the Shimpukuji Temple.

The sponsor and CSAM offered donations to the Marumori-machi Town Government. The town was severely hit by Typhoon Hagibis in October 2019.