Obayashi Corporation Green Bond, DNV Periodic Review (#4)

SECOND PARTY OPINIONOBAYASHI CORPORATIONGREEN BOND
DNV PERIODIC REVIEW (#4)

Prepared by: DNV Business Assurance Japan K.K.
Location: Kobe, Japan
Date: 30 June 2022
Ref. Nr.: PRJN-249559-2021-AST-JPN

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

Table of Contents
1 SCOPE AND OBJECTIVES ............................................................................................................ 3
2 RESPONSIBILITIES OF OBAYASHI AND DNV .................................................................................. 4
3 BASIS OF DNV’S OPINION ........................................................................................................... 44 WORK UNDERTAKEN .................................................................................................................. 5
5 FINDINGS AND DNV’S OPINION ................................................................................................... 6
SCHEDULE-1 (NOMINATED ASSETS & GREEN BOND PROJECT OUTLINE) ............................................ 13
SCHEDULE-2 GREEN BOND ELIGIBILITY ASSESSMENT PROTOCOL ..................................................... 14(1)Use of proceeds ................................................................................................................ 14(2)Process for Project Selection and Evaluation .......................................................................... 16(3)Management of proceeds ................................................................................................... 19(4)Reporting ........................................................................................................................ 21
Issue LogthDescription

October 15 , 2018

Second Party Opinion – Green bond eligibility pre-issue assessment report

October 28th, 2019

Green Bond Periodic Review

thJune 29 , 2020
June 30th,2021

June 30th, 2022
(This Issue)

Green Bond Periodic Review (#2)
Green Bond Periodic Review (#3)
Green Bond Periodic Review (#4)

Use of Proceeds: Total JPY 10 billion have been allocated by the end of FY2020 (as reported
in the last issue).
Environmental Benefits: CO2 emission reduction of solar power (3 plants) and onshore wind
power: 42,005 t-CO2 (FY2021)
Ongoing Project: The completion and delivery of the new SEP have been put off frominitially-planned 2020 to April 2023 in order to increase the crane capacity reflecting thewind turbine market conditions (as reported in the last issue).
*SEP: Self Elevating Platform, the vessel to support offshore wind construction

Disclaimer
Our assessment relies on the premise that the data and information provided by Issuer to us as part of our review procedures have been provided in good faith.
Because of the selected nature (sampling) and other inherent limitation of both procedures and systems of internal control, there remains the unavoidable riskthat errors or irregularities, possibly significant, may not have been detected. Limited depth of evidence gathering including inquiry and analytical procedures andlimited sampling at lower levels in the organization were applied as per scope of work. DNV expressly disclaims any liability or co-responsibility for any decision aperson or an entity may make based on this Statement.

Statement of Competence and Independence
DNV applies its own management standards and compliance policies for quality control, in accordance with ISO/IEC 17021:2011 - Conformity Assessment
Requirements for bodies providing audit and certification of management systems, and accordingly maintains a comprehensive system of quality control, including
documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. We
have complied with the DNV Code of Conduct1 during the assessment and maintain independence where required by relevant ethical requirements. This
engagement work was carried out by an independent team of sustainability assurance professionals. DNV was not involved in the preparation of statements ordata included in the Framework except for this Statement. DNV maintains complete impartiality toward stakeholders interviewed during the assessment process.

1 DNV Code of Conduct is available from DNV website (www.DNV.com)

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

1

SCOPE AND OBJECTIVES
On October 25, 2018, Obayashi Corporation (hereinafter “Obayashi” or “Issuer”) issued

Obayashi Green Bond (hereinafter “BOND”). The issuance value for the BOND is 10.0 billion JPY,
and its redemption period is 5 years. DNV Business Assurance Japan Co., Ltd. (hereinafterreferred to as “DNV”) conducted a green bond eligibility assessment by using the Green Bond
Guidelines (the Ministry of the Environment (Japan), 2017 hereinafter GBGLS) and the Green
Bond Principles 2018 (ICMA, hereinafter “GBP”).
Obayashi Green Vision 2050, the medium-to-long-term vision adopted in 2011, was updated to
Obayashi Sustainability Vision 2050. Under the new vision, the Obayashi group will work together
for the sake of sustainability. This Sustainability Vision expands on the Green Vision by including
promotion of ESG management and achievement of the SDGs. Obayashi established action plans
to solve the specified 6 material issues; “Promote renewable energy business” and “Promote
environmentally friendly business” are the action plans for the materiality “Establish an
Environmentally Responsible Society”. These action plans align with the previous action plans
which included “Promote renewable energy business” and “Promote environmentally responsible
real estate development projects”, established at the issuance of the BOND, based on Obayashi
Green Vision 2050.
Obayashi has used the proceeds of the BOND to refinance the nominated projects and assets
falling under the following categories, as scheduled:“Promote renewable energy business”- Solar PV business- Wind power business (onshore)“Promote environmentally friendly business”- Green building“Promote renewable energy business”- Wind power business (offshore) *SEP (Self Elevating Platform)

DNV has been commissioned by Obayashi to provide the initial and periodic reviews of the
Obayashi’s eligibility of the BOND. Our criteria and information covered to serve the purpose aredescribed under ‘Work Undertaken’ shown below. The periodic review was made based on theinformation and documents provided by Obayashi as well as the interview conducted with themon Jun. 3rd, 2022. We do not provide any independent assurance or other type of audit activities.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

In this report, no assurance is provided regarding the financial performance of the Issuer, thevalue of any investments in the BOND, or the long-term environmental benefits arising from thenominated projects. Our objective of these reviews has been to provide an assessment that theusage of the proceeds of the BOND has met the criteria established on the basis set out below.

2

RESPONSIBILITIES OF OBAYASHI AND DNV
The management of Obayashi has provided the information and data used by DNV during thedelivery of this review. Our statement represents an independent opinion and is intended to
inform Obayashi management and other interested stakeholders in the BOND as to whether theestablished criteria have been met, based on the information provided to us. In our work wehave relied on the information and the facts presented to us by Obayashi. DNV is not responsible
for any aspect of the nominated assets referred to in this opinion and cannot be held liable if
estimates, findings, opinions, or conclusions are incorrect. Thus, DNV shall not be held liable if
any of the information or data provided by Obayashi used as a basis for this assessment were notcorrect or complete.

3

BASIS OF DNV’S OPINIONDNV adapted our GBP*1, GBGLs*2, and Climate Bond Standard (for reference at pre-issuancestage)*3 assessment methodologies, which incorporate the requirements of the GBP, to create an
Obayashi specific Green Bond Eligibility Assessment Protocol (henceforth referred to as“Protocol”) for each project. Our Protocol includes a set of suitable criteria that can be used tounderpin DNV’s opinion. The overarching principle behind the criteria is that a green bond should“enable capital-raising and investment for new and existing projects with environmental
benefits”.
As per our Protocol, the criteria against which the BOND has been reviewed are grouped under
the four Principles:•

Principle One: Use of Proceeds. The Use of Proceeds criteria are guided by therequirement that an issuer of a green bond must use the funds raised to finance eligible
activities. The eligible activities should produce clear environmental benefits.

•

Principle Two: Process for Project Evaluation and Selection. The Project Evaluationand Selection criteria are guided by the requirements that an issuer of a green bondshould outline the process it follows when determining eligibility of an investment using
Green Bond proceeds, and outline any impact objectives it will consider.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)•

Principle Three: Management of Proceeds. The Management of Proceeds criteria are
guided by the requirements that a green bond should be tracked within the issuingorganization, that separate portfolios should be created when necessary and that adeclaration of how unallocated funds will be handled should be made.

•Principle Four: Reporting. The Reporting criteria are guided by the recommendationthat at least Sustainability Reporting to the bond investors should be made of the use ofbond proceeds and that quantitative and/or qualitative performance indicators should be
used, where feasible.

*1: Green Bond Principle (June 2018, International Capital Market Association)*2: Green Bond Guidelines, 2017 (March 2017, Ministry of the Environment, Japan)*3: Climate Bond Standard | version 2.1 (Climate Bonds Initiative)

4

WORK UNDERTAKEN

Our work constituted a high-level review of the available information, based on theunderstanding that the information was provided to us by Obayashi in good faith. We have not
performed an audit or other tests to check the veracity of the information provided to us. The
work undertaken to form our opinion includes initial assessment and periodic assessment.
Initial Assessment (pre-BOND issuance):•

Creation of an Obayashi -specific Protocol, adapted to the purpose of the BOND, asdescribed above and in Schedule-2 to this Assessment.

•

Assessment of supporting documents provided by Obayashi on the BOND andsupplemented assessment by a high-level desktop research. These checks refer tocurrent assessment best practices and standards methodology;•

Discussions with Obayashi, and review of relevant documentation;•

Documentation of findings against each element of the criteria.

Periodic Assessment (post-BOND issuance):•

Evaluation of the supporting documents provided by Obayashi and related to the BOND
issuance, high level desktop research, document reviews, and interviews with key
personnel of the Issuer. These checks refer to best practices in current assessment andstandard methodologies;•

Discussions with Obayashi management and review of relevant documentation;•

Field survey and inspection, if required;•

Review of the nominated projects and assets as described in Schedule 2;•Documentation of findings in detail.

Our opinion as detailed below is a summary of these findings.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

5

FINDINGS AND DNV’S OPINION

DNV’s findings are listed below:

Principle One, Use of Proceeds
Obayashi has reported usage of the proceeds [BOND proceeds: 10.0 billion JPY (*netproceed 9.94 billion JPY)] of the BOND to refinance, and begin finance to the projects andassets including:(1) Eligibility Criteria of Green Bond (refinanced):
Renewable energy (Project 01-04)- Project 01-03 : Solar PV project- Project 04: 3.5 billion JPY: Onshore wind power : 0.5 billion JPY

Energy efficiency (Project 06)- Project 06: Green Building

Sub Total: 3.0 billion JPY: 7.0 billion JPY…(A)(2) Eligibility Criteria of Green Bond (financing):
Renewable energy (Project 05)- Project 05: SEP︓2.94 billion JPY(Self Elevating Platform) construction/building*as of March 31, 2022
Sub Total: 2.94 billion JPY …(B): balance (0.0 billion JPY) …(C)Total

: 9.94 billion JPY …(A)+(B)+(C)Schedule-1 shows lists and details of green project 01-06.
DNV reviewed the eligibility of the nominated projects and assets to meet the criteria forthe project categories above.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

Project 01 Ashikita Solar Power Station, Solar PV

Project 02

Kushirocho Toritoushigenya Solar Power Station, Solar PV

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

Project 03 Hyugahichiya Solar Power Station, Solar PV

Project 04 Mitanehamada Wind Power Station

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

Project 05

SEP（Self Elevating Platform）Image

Project 06 oak kanda kaji-chou (commercial property)

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

Principle Two, Process for Project Evaluation and Selection
The BOND’s proceeds have been allocated solely to refinance and begin finance, asscheduled, the projects and assets as defined in Schedule 1. DNV has reviewed evidence
that demonstrates that Obayashi regularly assesses opportunities for improvement anddevises action plans and initiatives to mitigate negative environmental and social impacts
from its construction and operations.

Principle Three, Management of Proceeds
DNV has reviewed evidence showing how Obayashi traced the proceeds from the Bond,from the time of issuance to the time of disbursement. In this periodical review, themanagement of proceeds documents provided by Obayashi was confirmed at the end of FY
2021 (end of Mar. 2022). The full amount of the proceeds fund is managed in cash or cash
equivalents till disbursement. The details of the disbursement and the outstanding value
are tracked using Obayashi’s internal protocol. At the end of each financial period (fiscal
year), Obayashi reviews the outstanding balance of the BOND. DNV confirmed with theevidence provided by Obayashi that 7.0 billion JPY has been allocated at the end of the FY
2019 (Mar. 2020) as refinance, and 2.94 billion JPY has been allocated to the SEP building
work at the end of the FY 2020 (end of Mar. 2021), which mean that the raised 10 billion
JPY has fully allocated.
As stated above, DNV provides no assurance regarding the financial performance of theBond, the value of any investments in the Bond, or the effects of the transactions.

Principle Four, Reporting
Obayashi has confirmed that they include and maintain a dedicated section on theGreen Bond in its website. This includes detailed descriptions of the projects and valueof the proceeds invested, as well as the associated qualitative and quantitativeenvironmental impacts [CO2 emission reduction from Renewable Energy, Energy
Efficiency (Green Buildings)].
DNV confirmed whether the Green Projects have actual environmental benefits and ifthey were calculated properly by using the methods specified by Obayashi before theissuance of Green Bonds.
Table-1 shows the qualitative and quantitative environmental benefits by Obayashi
green bond projects which have started commercial operations.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

Table-1 Progress of Environmental Benefits (result of FY2021)
Project
01
02
03
04

Ashikita Solar Power Station
Kushirocho Toritoushigenya
Solar Power Station
Hyugahichiya Solar Power
StationMitanehamada Wind Power
StationEnvironmental Benefits

CO2 emission reduction︓42,005 t-CO2/ FY 2021
＊calculated according to actual performance※1

The number of the bottom mounted wind power
facilities supported by SEP (numbers/year): 0＊The completion date of the SEP will be
extended from the original plan of October 2020
to April 2023 in order to increase the crane
capacity reflecting the wind turbine market
conditions. The changes to this plan are postedon the Obayashi website and announced.*2
 “CO2 Emission Reduction of Designed & Built
Buildings” from “Environmental Achievements” (inGreen building (oak kanda
06
Obayashi’s web site)kaji-chou) Certified as BELS 5 stars (the highest ranked) as
energy efficiency building※1︓CO2 emission reduction＝Annual performance（kWh）×Published CO2 emission
05

SEP (Self Elevation Platform)

coefficient（kg-CO2/kWh）（Published CO2 emission coefficient :Ministry of the Environment, Japan）※2: Implementation of SEP design changes for the construction of offshore wind farms
and extension of completion time
(September 17, 2020)
https://www.obayashi.co.jp/news/detail/news20200908_2.html

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

On the basis of the information provided by Obayashi and the work undertaken, it is
DNV’s opinion that the BOND meets the criteria established in the Protocol and that it isaligned with the stated definition of green bonds within the Green Bond Principles andGreen Bond Guidelines, which is to “enable capital-raising and investment for new andexisting projects with environmental benefits”.

DNV Business Assurance Japan K.K.
30th June, 2022

Mark Robinson

Naoki Maeda

Manager, Sustainability Services

Managing Director

DNV – Business Assurance, AUS

DNV – Business Assurance Japan K.K.

Masato Kanedome

Yasuaki Miyamoto

Project leader
DNV – Business Assurance Japan K.K.

Team leader
DNV – Business Assurance Japan K.K.

About DNV
Driven by our purpose of safeguarding life, property and the environment, DNV enables organisations to advance thesafety and sustainability of their business. Combining leading technical and operational expertise, risk methodology andin-depth industry knowledge, we empower our customers’ decisions and actions with trust and confidence. We
continuously invest in research and collaborative innovation to provide customers and society with operational andtechnological foresight. With our origins stretching back to 1864, our reach today is global. Operating in more than 100
countries, our 16,000 professionals are dedicated to helping customers make the world safer, smarter and greener.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

SCHEDULE-1 (NOMINATED ASSETS & GREEN BOND PROJECT OUTLINE)
No.

Nominated projects andassets01

Ashikita Solar Power Station(refinance)

02

Kushirocho Toritoushigenya
Solar Power Station(refinance)

03

Hyugahichiya Solar Power St
ation(refinance)

04

Mitanehamada Wind Power S
tation(refinance)

05

SEP (Self Elevation Platform)(new construction)06

oak kanda kaji-chou(refinance)

GBP category(environmental benefit)

GBP Sub category

Funded amountRemarks(location, output, outline)

3.5 billion JPY(FY 2018 refinanced)- Ashikita, Kumamoto, 21.5MW,- Apr 2014 commercial operation(Total 10 billion JPY, netproceeds 9.94billion JPY)

- Kushiro, Hokkaido, 17.8MW,- Apr 2017 commercial operation

Solar PV (onshore)- Hyuga, Miyazaki, 24.5MW,- May 2017 commercial operation

Renewable energy[Energy source CO2 emi
ssion reduction][*No.05: the number ofthe bottom mounted offshore wind power facili
ties supported by SEP]Wind Power (onshore)

0.5 billion JPY(FY 2018 refinanced)
2.94 billion JPY(FY 2020 allocated)

Dedicated Offshore
wind power
construction facility

Energy efficiency(green buildings)[Energy source CO2

Certified energy
efficiency building (forcommercial)

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3 billion JPY(FY 2018 refinanced)- Mitane, Akita, 5.97MW,- Nov 2017 commercial operation- For bottom-mounted wind power station, made by JMU- Start of allocation from 2019. In 2020, it was decided to extend the plan from the completed delivery in
October 2020 to the completed delivery in April 2023 in order to incre
ase the crane capacity reflecting the wind turbine market conditions.
- Tokyo, Chiyoda, BELS certification(5 stars) commercial office building

Obayashi Corporation Green Bond, DNV Periodic Review (#4)

SCHEDULE-2 GREEN BOND ELIGIBILITY ASSESSMENT PROTOCOL
Obayashi Green Bond Framework and Amendment to Shelf Registration Statement and summary of annual reporting (result of FY2021) have been
published for explanation to investors.

(1)

Use of proceeds

Ref.

Criteria

Requirements

Work Undertaken

DNV Findings

1aType ofbond

The bond must fall in one of
the following categories, as
defined by the Green Bond
Principles:•Green Use of Proceeds
Bond•Green Use of Proceeds
Revenue Bond•
Green Project Bond•
Green Securitized Bond

Documents reviewed:
Obayashi Green Bond
Framework
Amendment to Shelf
Registration Statement
Discussions with Obayashi
management

The reviewed evidence confirms that the BOND falls in the category:

Green
Project
Categories

The cornerstone of a Green
Bond is the utilization of theproceeds of the bond whichshould be appropriately
described in the legal
documentation for the
security.

Documents reviewed:
Obayashi Green Bond
Framework
Amendment to Shelf
Registration Statement
Documents of fundallocation records in FY
2018, 2019, 2020 and
2021

As identified by the purpose of the BOND was to use the proceeds to refinancefor projects falling under the following categories:<Renewable energy>-Refinance to the 3 Solar PV Projects• Ashikita• Kushirocho toritoushigenya• Hyugahichiya-Refinance to the 1 Wind Power Project (onshore)• Mitanehamada

1bGreen Use of Proceeds Bond.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

Ref.

Criteria

Requirements

Work Undertaken

DNV Findings

Project documents(including asset
specifications)
Discussions with Obayashi
management<Energy efficiency>-Refinance to Green building (commercial property)• oak kanda kaji-chou lease-office building-

Same as above, Bond proceed has been allocated to the following project
categories by the end of FY2020.
<Renewable energy>-Finance to the 1 Offshore wind power dedicated facilities• SEP building
DNV’s assessment concluded that these assets would present a low risk of CO2
emissions and relative to negative effect quantify and qualify for inclusion under
the Green Bond Principles 2018 within the Renewable Energy category andEnergy Efficiency category. Above information was included in legal documents
such as Amendment to Shelf Registration Statement. DNV concluded that 1b
requirement is satisfied.

1c

Environment
al benefits

All designated Green Project
categories should provide
clear environmentally
sustainable benefits, which,where feasible, will bequantified or assessed by theissuer.

Documents reviewed:
Obayashi Green Bond
Framework
Project documents(including asset
specifications)
Renewable energy CO2emission reduction
evaluation result in
FY2018, 2019, 2020
and 2021
Discussions with Obayashi
management

DNV notes that solar PV and wind power project can present risks of land use
and ecology system through construction and operation. DNV GL reviewed
Obayashi’s provided document and confirmed that Obayashi already identified
the environmental risk and addressed appropriate countermeasure. Obayashi
has clearly demonstrated those projects will contribute benefit for environment
such as CO2 emission reduction. SEP will contribute to the domestic offshore
wind power construction market expected the momentum in the future whichcorresponds with offshore wind power expansion and promotion in the “The 5thStrategic Energy Plan” issued by Japanese government (Jul 2018), METI
(Ministry of Economy, Trade and Industry) as well as Japan Wind Power
Association’s (JWPA) promotion of offshore wind power installation. ‘oak kanda
kaji-chou’ was certified as BELS 5 stars (the highest ranked) as energy
efficiency building reducing 40 % of primary energy consumption would resultclear environmental benefit.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

Ref.

Criteria

Requirements

Work Undertaken

DNV Findings
DNV concluded that 1c requirement is satisfied.

1d

Refinancing
share

(2)

In the event that a proportionof the proceeds may be used
for refinancing, it isrecommended that issuers
provide an estimate of theshare of financing vs. refinancing, and whereappropriate, also clarify whichinvestments or project
portfolios may be refinanced.

Documents reviewed:
Obayashi Green Bond
Framework
Amendment to Shelf
Registration Statement
Documents of fundallocation records in FY
2018, 2019, 2020 and
2021
Discussions with Obayashi
management

The proceeds of the BOND, in their entirety (10 billion JPY), will be allocatedto green project. Refinance plan is as follows (approx.70% in total amount ofproceeds)-Refinance to the 3 Solar PV Projects : 3.5 billion JPY (refinanced, FY2018)-Refinance to the 1 Wind Power Project (onshore): 0.5 billion JPY (refinanced,
FY2018)-Refinance to Green building (commercial property) : 3 billion JPY (refinanced,
FY2018)Process for Project Selection and Evaluation

Ref.

Criteria

Requirements

Work Undertaken

DNV Findings

2aInvestmentdecision
process

The issuer of a Green Bond should
outline the decision-making process it
follows to determine the eligibility of
projects using Green Bond proceeds.
This includes, without limitation:• A process to determine how the
projects fit within the eligible Green
Projects categories identified in theGreen Bond Principles;

Documents reviewed:
Obayashi Green Bond
Framework
Obayashi internal
document related tothe project selection
Discussions with Obayashi
management including
official e-mailcommunication.

As per the Obayashi green bond framework, the issuer has set out
the eligible project under the GBP 2018 and related criteria.project
selection. “Eligible green project” means alignment with theircorporate philosophy and environmental policy which fall into
Obayashi Sustainability Vision 2050 that has been updated from
Obayashi Green Vision 2050 when Obayashi referred its framework

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Obayashi Sustainability Vision 2050
Action plan in Materiality “Establish Environmentally Responsible
Society”

Ref.

Criteria

Requirements

Work Undertaken• The criteria making the projects
eligible for using the Green Bond
proceeds; and• The environmental sustainability
objectives

2bIssuer’s
environment
al and social
andgovernanceframework

In addition to information disclosed by
an issuer on its Green Bond process,criteria and assurances, Green Bond
investors may also take into
consideration the quality of the issuer’s
overall framework and performance
regarding environmental sustainability.

Obayashi Corporation Green Bond, DNV Periodic Review (#4)

DNV Findings-Promote renewable energy business-Promote environmentally friendly business

Documents reviewed:
Obayashi Green Bond
Framework
Obayashi corporate
philosophy andenvironmental policy
Discussions with Obayashi
management
https://www.obayashi.co.j
p/en/sustainability/environ
ment.html
https://www.obayashi.co.jp/renewable_energy/

Nominated projects and assets were discussed with Obayashi’s
related departments and responsibilities (e.g. Financial department,
Environmental department, CSR committee representatives(representative director, President))
DNV concluded that 1c requirement is satisfied through interview,
discussion and document review.
As per the interview and review of documents provided by Obayashi,
DNV confirmed that Obayashi has addressed “sustainable society”
through its business based on the Obayashi Sustainability Vision 2050
updated from Obayashi Green Vision 2050, which DNV referred to as
its framework at pre-issuance stage. Obayashi has published
OBAYASHI Corporate Report and its website including green bondspecific requirements and its sustainable activities described above.
Obayashi already owns 30 renewable power stations in Japan andcontributes to achieve low carbon society
https://www.obayashi.co.jp/en/sustainability/vision.html
https://www.obayashi.co.jp/en/sustainability/environment.html
https://www.obayashi.co.jp/en/special/renewable_energy.html
DNV notes that the performance of the nominated projects and assets
within the Bond pool is to be reported as a part of Obayashi’s periodic
Sustainability reporting as per the Obayashi Green Bond Framework.
DNV confirmed that Obayashi updated their Obayashi Green Vision to
Obayashi Sustainability Vision, which promotes its initiative toconsider environment and society.

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Ref.

Criteria

Requirements

Work Undertaken

Obayashi Corporation Green Bond, DNV Periodic Review (#4)

DNV Findings

DNV confirmed and found nothing to suggest that Obayashi’s
environmental activity is not in line with their activity to contribute tosustainable society through its green projects.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)(3)

Management of proceeds

Ref.

Criteria

Requirements

Work Undertaken

DNV Findings

3aTracking
procedure-1

The net proceeds of Green Bonds shouldbe credited to a sub-account, moved to a
sub- portfolio or otherwise tracked by theissuer in an appropriate manner andattested to by a formal internal processthat will be linked to the issuer’s lending
and investment operations for Green
Projects.

Documents reviewed:
Obayashi Green Bond
Framework
Amendment to Shelf
Registration Statement
Obayashi’s internal protocol(e.g. accounting management
procedure, document control
procedure)
Record documents of fundallocation records in FY 2018,2019, 2020 and 2021
Discussions with Obayashi
management

DNV reviewed documents and interviewed that Obayashi
has traced the proceeds from the Bond, from the time ofissuance to the time of disbursement appropriately. The fullamount of the proceeds has been managed by Obayashi’s
financial department with existing accounting system andusing green bond request for approval document form.
DNV confirmed that Obayashi’s internal process canmanage and track the outstanding balance of the green
bond proceeds. DNV concluded that 3a requirement issatisfied.

3b

Tracking
procedure-2

So long as the Green Bonds areoutstanding, the balance of the tracked
proceeds should be periodically reducedby amounts matching eligible green
investments or loan disbursements madeduring that period.

Documents reviewed:
Obayashi Green Bond
Framework
Obayashi’s internal protocol(e.g. accounting management
procedure)
Record documents of fundallocation records in FY 2018,2019, 2020 and 2021
Discussions with Obayashi
management

DNV reviewed documents and interviewed that Obayashi
has implemented an appropriate scheme to trace theproceeds from the Bond from the time of issuance to thetime or disbursement, and has reduced the net balance ofproceeds by amounts in line with the projects and assets
debt refinance schedule, as planned. At the end of eachfinancial period (at least every one quarter), the outstandingbalance of the Bond has been reviewed by Obayashi financial
department. DNV concluded that 3b requirement is satisfied.

3c

Temporaryholdings

Pending such investments or
disbursements to eligible Green Projects,

Documents reviewed:

The net proceeds of the Bond have been placed in anexisting accounting system and managed by financial

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

Ref.

Criteria

Requirements

Work Undertaken

DNV Findings

the issuer should make known toinvestors the intended types of
temporary investment instruments forthe balance of unallocated proceeds.

-

Obayashi Green Bond
Framework 2(3),2(4)Amendment to Shelf
Registration Statement
Record documents of fundallocation results records in FY
2018, 2019, 2020 and 2021
Discussions with Obayashi
management

department using request approval document form for green
bond proceeds.
The net proceeds of the bond also has been fully and
immediately disbursed where possible or held in cash or
cash equivalent until disbursement to the nominatedprojects and assets as per the Obayashi green bondframework. DNV concluded that 3c requirement is satisfied.

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Obayashi Corporation Green Bond, DNV Periodic Review (#4)

(4)

Reporting

Ref.

Criteria

Requirements

Work Undertaken

DNV Findings

4aPeriodical
reportingIn addition to reporting on the use ofproceeds and the temporary
investment of unallocated proceeds,
issuers should provide at least
annually a list of projects to which
Green Bond proceeds have been
allocated including- when possible with regards toconfidentiality and/or competitive
considerations- a brief description of the projects
and the amounts disbursed, as well as
the expected environmentally
sustainable impact.

Documents reviewed:
Obayashi Green Bond Framework 2(4)Fund allocation records in FY 2018, 2019,2020 and 2021
Renewable energy CO2 emission reduction
evaluation result (FY2018, 2019, 2020 and
2021)
Obayashi Green Bond Reporting (Obayashi#23 SB in Obayashi’s website)
Environmental data (in Obayashi’s website)*Green building environmental impact wasreported as aggregated data. Details aredescribed in Table-1 Project 06.
Discussions with Obayashi management

Obayashi has published the annual report“Obayashi Green Bond Report” and“Environmental data”, including a dedicatedsection on the green bond in its website as per
its framework. This includes description of the
project and value of the proceeds invested, as
well as the associated qualitative andquantitative environmental impacts. Obayashi
reported on the total amount of CO2 emission
reduction evaluation based on the operation
records (amount of electricity generation peryear, MWh/FY). DNV concluded that 4arequirement is satisfied.

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