Trading firm Sumitomo said it will buy back its stock and adopt a progressive dividend policy, bringing it in line with the other four major peers in an effort to boost shareholder returns.

Sumitomo will allocate ?700 billion ($4.5 billion) of returns over the next three years, with a goal of total shareholder return ratio of 40%, the company said Thursday in a filing. It¡¯s also aiming for at least 12% return on equity for the fiscal year ending March 2027, and plans to buy back up to ?50 billion worth of shares.

The stock closed 4.4% higher, extending a record high, after briefly jumping as much as 7.6%. Trading volume more than quintupled its three-month daily average.

¡°This looks like a good commitment to deliver strong returns over several years step-by-step rather than a big bang announcement with all the good news out at once,¡± said Mio Kato of LightStream Research. The new plan should give investors time to digest and understand the company¡¯s potential, ¡°and the outlook feels quite positive without a sense of massive over-promising.¡±

The announcement follows a rally in shares of Sumitomo and its peers, which have benefited from Warren Buffett¡¯s Berkshire Hathaway taking a stake in the companies. Activist investor Elliott Management is also said to have built a ¡°large¡± stake, adding pressure to boost shareholder returns.

President Shingo Ueno declined to comment on Elliott¡¯s reported stake, but added that the company has a fair disclosure policy and is ¡°in talks with a wide range of investors and shareholders.¡±

¡°We will continue to reflect those voices from stakeholders in our management,¡± Ueno said at a briefing in Tokyo. The company is still in talks with Berkshire Hathaway, but there aren¡¯t business opportunities that have materialized between the two firms yet, he said.

Buffett said in his February letter to investors that the companies follow shareholder-friendly policies that are ¡°superior¡± to those practiced in the U.S.