Sumitomo Corporation - Recognized as the best market maker in the 'Market Maker System' conducted by the Tokyo Stock Exchange
March 20, 2024 at 07:42 am EDT
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Sumitomo Corporation was awarded the award as the best market maker that contributed to market formation under the 'Market Maker System' (hereinafter referred to as the 'MM System'), which was implemented on a trial basis in the carbon credit market established by the Tokyo Stock Exchange.
Carbon credit market holds great expectations for Japan's decarbonization
In order to achieve carbon neutrality in 2050 as set by the Japanese government, it is expected that carbon pricing, which puts a price on emitted CO2, will be used to change the behavior of companies that emit CO2 . In the 'Basic Policy for Realizing GX' announced in 2023, the Japanese government announced the introduction of an 'emissions trading system' (1) as part of its carbon pricing strategy, with full-scale operation scheduled to begin in fiscal 2026. Masu.
In response to this trend, the Tokyo Stock Exchange will utilize the knowledge and market management experience gained from the 'Technical Demonstration Project for the Carbon Credit Market,' which was commissioned and implemented by the Ministry of Economy, Trade and Industry in fiscal 2022. We opened a carbon credit market in February. Additionally, from November of the same year, we implemented a MM system on a trial basis with the aim of establishing appropriate prices for carbon credits and improving liquidity through market transactions.
The MM system is a financial market in which a market maker qualified by a stock exchange continuously presents buying and selling quotes (price and quantity), guaranteeing execution for market participation orders, and controlling the market as a whole. This system aims to stabilize the trading volume of Sumitomo Corporation was selected as one of five market makers for the implementation of the MM system, and has achieved all target standards during the MM system period, contributing to improved liquidity and price formation in the carbon credit market. Awarded as Best Market Maker.
Sumitomo Corporation's efforts in the carbon credit field
Sumitomo Corporation has 'realized a sustainable society' as an important management theme. In April 2022, we established the Carbon Solutions Team as a specialized organization responsible for promoting decarbonization solutions business centered on carbon credits across the entire company. Through the development and sale of carbon credits through projects that contribute to the reduction of essential greenhouse gases, Sumitomo Corporation aims to solve the important social issues of 'mitigating climate change' and 'realizing a circular economy,' and to realize a carbon-neutral society. I will continue to contribute.
Sumitomo Corporation is a diversified group organized around 7 areas of activity:
- retail distribution of consumer goods (24.4% of net sales): food products, apparel and accessories, pharmaceuticals, building materials, household and decorative items, etc. The group is also developing a real estate business;
- trading of hydrocarbon, mining, chemicals and electronics products (24%): oil, natural gas, copper, gold, silver, zinc, lead, nickel, coal, iron ore, resins, pesticides, petrochemical products, etc.;
- trading of steel products and non ferrous metals (20%): flat and long steel products, tubular products, aluminum products, titanium, etc.;
- distribution of transportation and construction systems and equipments (15.1%): spatial equipments, landing fields, forest machines, motorcycles, mining operating vehicles, etc.;
- telecommunications and multimedia products and services supplies (8.8%): TV wiring, data communication solutions, film distribution services, mobile telephony, Internet access and computing services;
- development and implementation of civil engineering infrastructures (7.6%): power plants, wastewater treatment units, industrial plants, telecommunications centers, etc. The group is also providing logistics services;
- other (0.1%).