Japan FSA Publishes Customer-Oriented Business Operations List and Opens January 2027 Reporting Wind

Key Takeaways

• Japan's Financial Services Agency published its September 18, 2026 List of Financial Institutions, covering 1,476 firms that have adopted the Principles for Customer-Oriented Business Operations.
• It also released analysis of common KPIs for investment trusts and foreign currency-denominated insurance as of March 31, 2026.
• Firms seeking inclusion or continued listing must submit reports by January 8, 2027, and may be delisted if their actual practices diverge from their published commitments.

Deep Dive

Japan's Financial Services Agency published its September 18, 2026 List of Financial Institutions, covering 1,476 firms that have adopted the Principles for Customer-Oriented Business Operations. It also released analysis of common KPIs for investment trusts and foreign currency-denominated insurance as of March 31, 2026. Firms seeking inclusion or continued listing must submit reports by January 8, 2027, and may be delisted if their actual practices diverge from their published commitments.

The FSA's list is a voluntary, visibility-based mechanism that supports its customer-oriented business initiative. Listed firms must have published their policies and implementation status, along with a correspondence table mapping them to Principles 2-7 and Supplementary Principles 1-5. The 1,476 listed firms span city banks (38), regional banks (106), cooperative financial institutions (309), insurance companies (735), financial instrument business operators (284), and others (4). Of these, 979 were added or updated in this cycle. The FSA states it makes no judgment on the substance of the policies or on how fully a firm has adopted the Principles. Even so, listing carries reputational weight and signals conduct standards to customers, distributors, and supervisors.

The Principles follow a "comply or explain" approach. For each item, firms must state whether they will implement it. If so, they must describe an action plan. If not, they must explain why and describe alternative measures. "Not Applicable" is allowed only where the firm does not handle the relevant services or is legally restricted from implementing the item. The FSA may request corrections to inaccurate website content or submissions. It may also remove a firm from the list if its claimed efforts cannot be confirmed, or if its actual practices differ materially from its action plan and it does not promptly remedy the gap. Firms are generally listed for one year from the publication date.

The FSA also published its analysis of common KPIs as of March 31, 2026. For investment trusts, the KPIs cover customer ratios by investment profit/loss and the cost-return and risk-return of the top 20 funds by assets under management. For foreign currency-denominated insurance, they cover customer ratios by investment performance rating and cost and return by investment fund. The database also covers fund wraps, though the FSA's analysis does not. The FSA cleanses submitted data but does not guarantee its accuracy. Compliance teams should treat the data as an indicative benchmark, not an authoritative one, and should expect supervisory attention on product cost-effectiveness and suitability.

The next reporting deadline is 5:00 PM JST on Friday, January 8, 2027. Firms must post the FSA-prescribed correspondence table on their websites first, then submit the latest Excel report form by email. The email subject line and file name must follow the prescribed formats. The notice also says firms whose current publication date is March 17, 2026 should follow the renewal steps. Firms must use only the current form and consult the Q&A, checklist, flowchart, and examples. Recommended actions:
- Confirm listing status and renewal eligibility.
- Reconcile the published policies and correspondence table with actual practices.
- Validate KPI data and benchmark it against FSA results.
- Assign an owner and an internal review timeline ahead of the deadline.
- Retain evidence supporting each "comply" response.

Risk implications center on misstatement and delisting. Missing the deadline or submitting inaccurate or outdated forms could lead to exclusion, correction requests, and reputational harm. Gaps between stated and actual practices could also draw heightened supervisory scrutiny, particularly for distributors of investment trusts and foreign currency-denominated insurance. Note that the source document contains a date inconsistency: its body is dated September 18, 2020, while the metadata and content refer to 2026. The text is also machine translated, so firms should verify details against the official Japanese source.

Source: Financial Services Agency (Japan)