Sustainability Report(Asset Management Company)

July 2024

■ Contents■ Disclosure Policy on This Report
This report is prepared for the purpose of reporting regularly
to stakeholders to deepen their understanding of thephilosophy and initiatives of MORI TRUST REIT, Inc.
(“MTR”) and its asset management company MORI TRUST
Asset Management Co., Ltd. (“MTAM”) regarding ESG. In
preparing this report, efforts are made to proactively
disclose information while taking into account the requests
and expectations from stakeholders and considering the
Sustainable Development Goals (SDGs), the international
disclosure frameworks of ESG and ESG evaluations byexternal organizations.

1.

Message from the Management

52.

Policies and Management Structure

6

Sustainability Policy

6

Materiality

7

Meeting for Promotion of Sustainability

9

Employee Training on Sustainability

9Initiatives for Human Rights

10

Information Disclosure and Communication

10

GRESB Real Estate Assessment

11

Climate Change Initiatives

13

Awareness of Climate Change

13

Declaration of Support for the TCFD
Recommendations

13

Governance Relating to Climate Change

14

MORI TRUST REIT, Inc.

Strategies

14

MORI TRUST Asset Management Co., Ltd.

Risk Management

16

Metrics and Targets

16(information of its sponsor, MORI TRUST CO., LTD., is also
included)

Environmental Initiatives

17

Environmental Management System (EMS)

17

Examples of Environmental Initiatives

17

Collaboration with Tenants and Suppliers

19

Environmental Considerations for
Redevelopment

20

Environmental Performance Data

21

Management of waste

21

Green Finance22

Acquisition of Environmental Certificationand Evaluation25

Social Initiatives

26

Stakeholder Engagement

26

Improvement of tenant, property
management company, hotel operator andother supplier satisfaction and comfort etc.

27

Initiatives for Hotel Users

28

Initiatives for Local Communities

29

Activities for social issues

30

Disaster Response

30

Initiatives for Employees

32

Initiatives for Investors and Lenders

38

Measures for Dealing with Complaints

38

Governance Initiatives

39

Corporate Governance

39

Compliance Structure

43

Risk Management

46

Other Initiatives

46

3.

4.

5.

6.

■ Reporting Period
From April 1, 2023 to March 31, 2024
(some of the most recent activities after this period arealso included)■ Entities■ Date of Report Issued
July 1, 2024
(Date of Last Report: July 1, 2023)■ Reporting Cycle
Scheduled to be issued every July (annual)■ Contact
MORI TRUST Asset Management Co., Ltd.
Strategic Management Department
TEL: +81-3-6435-7011■ Disclaimer
This report is solely for the purpose of providing informationand is not intended for the purpose of soliciting investment
in or recommending transactions of certain instruments. For
possible purchase of investment units of MTR, pleasecontact your securities companies to obtain materials forsoliciting investment and fully understand what is explained
therein. Please note that unitholders may suffer a loss
depending on such factors as economic conditions, interest
rate conditions and supply and demand status in accordancewith the investment unit price. We request that when
making an investment decision you will do so based on yourfinal judgment while paying full attention to your specificsituation and other factors.
As for the content of this report, MTR makes no guarantee
as to the accuracy or completeness of the information
provided herein. Furthermore, the content may be changed
or eliminated without prior notice. No party is permitted toreprint, use, copy, distribute, modify or make any
arrangements to the content of this report without firstobtaining the consent of MTR.

2▮ Overview of MTR
MTR is a comprehensive REIT, whose main sponsor is MORI TRUST CO., LTD, a leading
developer and with offices and hotels as its core assets, which is truly equipped with asset
potential, stability and growth potential.
MTR was listed on the Tokyo Stock Exchange’s market for real estate investment trusts (JREIT market) in 2004 and has since achieved steady growth by investing in carefully selected
properties that will contribute to stable operations over the medium and long term.

Name of Investment Corporation

MORI TRUST REIT, Inc.

Address

3-1 Toranomon 4-chome, Minato-ku, Tokyo

Representative

Hiroshi Naito, Executive Director

Date of foundation

October 2, 2001

Date of listing

February 13, 2004

Portfolio type

Office buildings, hotels, commercial
facilities and residential properties

Securities Code8961

Fiscal period end

February and August

Features of MTR

1

Pursue Asset Potential, Stability and Growth Potential

2

Broad collaboration with the Mori Trust Group

3

Solid financial strategy

・ Building a portfolio with both stability and growth potential based on its coreassets, offices and hotels
・ Attaches importance to “quality” including “location” and “sense of being highgrade”

・ MORI TRUST Holdings, Inc. owns approximately 29.2% (Note)of the investment units outstanding of MTR・ Collaborates over the acquisition and sale of real estate, etc. and also uses theGroup’s strong expertise in real estate leasing and management

・ Acquired “AA” rating (Outlook: Stable), the highest among J-REITs
・ Leverages creditworthiness to borrow capital at a low rate of interest(Note) As of February 29, 2024

MTR’s Organization Chart
For MTR’s Organization Chart, please refer to page 40 of this report.

3

▮ Overview of Asset Management Company
Company NameMORI TRUST Asset Management Co., Ltd.

Address

3-1 Toranomon 4-chome, Minato-ku, Tokyo

EstablishedFebruary 28, 2000

Capital Stock
No. of Officers andEmployees*

400 million yen

Shareholders

Registration andLicenses

24
MORI TRUST CO., LTD. 95％
Mori Trust Hotels & Resorts Co., Ltd. 5％
Financial instruments business(Type: Investment management business),
Registration No.:
Kanto Local Finance Bureau Director-General (Financial instruments business) No.407
Comprehensive real estate investment advisory business, Registration No.:
Minister of Land, Infrastructure and Transportation No.000001
Building lot and building transaction business, License No.:
Governor of Tokyo (1) No. 110679
Discretionary trading agent, etc. for building lot and building transaction business,
Permission No.: Minister of Land, Infrastructure and Transportation No.4
Member of The Investment Trusts Association, Japan
Hiroshi Naito, President and Representative Director
Nobuyuki Aizawa, Managing Director, General Manager, Business Administration
Department, and General Manager, Strategic Management Department
Takuya Yamazaki, Director (in charge of Investment Management Department)
Seisaku Ito, Corporate auditor

Directors** As of June 30, 2024

Corporate Philosophy
MTAM was founded as a member of MORI TRUST Group for the purpose of managing the assets ofreal estate investment corporations.
The inclusion of “Trust” in our company name conveys the idea that we serve society and aremandated by society to manage assets over the long term. We are, therefore, required to conductbusiness based on the fundamental management principles of providing high quality real estate
management, increasing added value and contributing to social and economic development.
The concept of “Trust” is expressed more concretely in the following four qualities, which form
our corporate philosophy.
Reliability

Trust between the trustor and trustee will form the basis of everything we do.

Continuity

We will prove ourselves worthy of the trust placed in us by operating and managing
assets over the long run.

Benefit
Sharing

We will share any profits generated with society and stakeholders for our mutual
development.

SocialNatureWe will contribute to society by conducting socially beneficial business activities.

Furthermore, MTAM has adopted four basic management principles for realizing this management
philosophy: “Growth potential,” “Profitability,” “Stability” and “Transparency.” Striking a balance
between these requirements, we endeavor to achieve enduring corporate management in order toprove ourselves worthy of society’s mandate and to live up to the expectations and trust of ourshareholders, employees and other stakeholders.
To endure and survive as a company, above all else, it is essential to build a compliancestructure based on high ethical standards and to ensure compliance. We are committed to doing
this based on the strong awareness that it is imperative for us to conduct our day to day operations
in strict compliance not only with laws and regulations but also with social norms and internal rules

4１．Message from the Management
MTR believes that initiatives to improve sustainability are essential for enhancing unitholder value forthe medium to long term. Also, MTAM, to which MTR entrusts the management of its assets,
establishes a corporate philosophy of “Reliability,” “Continuity,” “Benefit sharing” and “Social nature,”
and aims to improve unitholder value by contributing to social and economic development throughcooperation and collaboration with various stakeholders.
I introduce recent initiatives on ESG.
With regard to “E: Environment”, MTR is working to reduce the environmental impact of its portfolio
by saving energy and reducing greenhouse gas emissions through the introduction of equipment withhigh energy-saving performance, and by making effective use of limited resources by conserving waterand reducing waste. MTR has been promoting energy-saving measures in its facilities, including the useof LED lighting fixtures at the Kioicho Building, Sendai MT Building, Midosuji MTR Building and Hilton
Odawara Resort & Spa. In addition, MTR has been working to obtain environmental certifications andassessments. In the fiscal period under review, Kamiyacho Trust Tower obtained DBJ Green Building
certification and Hotel Sunroute Plaza Shinjuku became the first MTR property to obtain BELS. The
ratio of certified properties in the portfolio, excluding land with leasehold interest, is 65% on thenumber of properties basis and around 57% on a leasable area basis as of March 31, 2024. MTAM has
formulated a green finance framework with the aim of further promoting ESG investment andstrengthening funding base of MTR by expanding the number of investors and lenders interested in
ESG investment and financing. MTR has issued its first green bonds in December 2023.
With regard to "S: Society," MTR strives to contribute to tenant satisfaction and sustainable
development of local communities by building good relationships, partnerships, and collaboration withexternal parties involved in the properties it owns. In addition, MTAM strives to create a healthy andcomfortable work environment so that employees of MTAM can maximize their abilities. During theperiod under review, posters were displayed at properties owned in order to cooperate with theJapanese Red Cross Society's awareness-raising activities. During the period under review, MTR
displayed posters at properties owned in cooperation with the Japanese Red Cross Society's
awareness-raising activities. With regard to the employees of MTAM, MTAM has formulated an action
plan to improve their satisfaction based on the results of an employee satisfaction survey and is
promoting efforts for improvement. In addition, we stipulated the creation of a diversity, equity, andinclusion (DEI) work environment as one of our sustainability policies, and established a DEI policy andprovided DEI training to all full-time officers and employees.
With regard to "G: governance," MTR implemented
training and awareness-raising activities such as providing
compliance training to all executives and employees of
MORI TRUST Asset Management Co., Ltd. on a regularbasis, and sought to improve compliance awareness among
employees.
MTR will continue to promote various initiatives on issues
regarding ESG and proactively disclose information in
response to the expectations from various stakeholders.

Hiroshi Naito
MORI TRUST REIT, Inc.,
Executive Director
MORI TRUST Asset Management Co., Ltd.,
President and Representative Director

5２．Policies and Management Structure
MTAM recognize that efforts to improve sustainability such as environmental consideration, contribution
to society and strengthening corporate governance though our asset management operations are
essential for growing unitholders' value in the medium to long term. We hereby establish the"Sustainability Policy" and aim to implement it.

▮ Sustainability Policy（１）Promoting GHGs emissions reduction and energy saving
We recognize the importance of net-zero greenhouse gas emissions and promote energy savingwith a long-term goals of net-zero emissions by 2050 in order to support the international goals
set out in the Paris Agreement and contribute to climate change mitigation.
（２）Contributing to Recycle-oriented Society
We strive to contribute to realizing sustainable recycle-oriented society through implementing
measures to make effective use of limited resources, such as water saving and "3Rs" for reducing
wastes, i.e., reduce, reuse, recycle.
（３）Streamlining Internal Management System and Strengthening Compliance
We establish internal management system to effectively promote initiatives based on this policy
and strictly comply with laws and regulations including environmental and social matters. In
addition, we promote sustainability initiatives by improving employees' awareness andperformance by continually implementing educational and awareness-raising activities focused on
environment, society, and governance (ESG).
（４）Respect for Human Rights and realization of DEI-friendly work environment
We respect human rights based on international norms such as the Universal Declaration of
Human Rights and the ILO Declaration on Fundamental Principles and Rights at Work, andengage in business operations in compliance with human rights-related laws and ordinances in
the countries and regions in which we conduct our business activities. We also respect each andevery employee, regardless of age, nationality, gender, values, or disability, and strive to create ahealthy and comfortable work environment where each individual can reach his or her fullpotential.
（５）Promoting Health and Comfort
We conduct asset management that seeks improvement in health, safety, and comfort of tenants
and facility users.
（６）Responding to Climate Change and Improving Resilience
We identify and evaluate risks and opportunities that arise from climate change and reflect themin our asset management operations, and by doing so, promote initiatives for adapting to andmitigating climate change to respond to risks and opportunities.
（７）Collaborating with External Stakeholders
We make efforts to contribute to reducing environmental impact of our assets undermanagement, improving tenants' satisfaction and developing sustainable local communities
through engaging and collaborating with external stakeholders such as our tenants/occupiers,
suppliers (e.g. property management companies) and local communities.
（８）Disclosing ESG Information
We strive to proactively disclose ESG information such as this policy and status of sustainability
initiatives to build good relationships and communicate with stakeholders such as our unitholders,tenants and suppliers.

6

2. Policies and Management Structure▮ Materiality
MTR has identified the issues to be focused on as materiality while promoting various initiatives on
issues regarding ESG based on the “Sustainability Policy” of MTAM, and has given priority to theidentified issues. Also, MTR aims to contribute to the achievement of “SDGs (Sustainable
Development Goals)” adopted at the United Nations in 2015 through initiatives for the materiality.

Materiality Identification Process(1) Clarification of Issues
Clarified issues in consideration of the expectations from stakeholders involved in MTR andsociety, issues recognized in the REIT sector, Sustainable Development Goals (SDGs) and
ESG evaluations by external organizations, recent social trends and the Sustainability Policy of
MTAM, etc.

(2) Organization and Summarization of Identified Issues, Assessment of their
Importance and Priority
Organized and summarized the identified issues considering the major past and current
initiatives, and then assessed the importance and priority of each issue.
(3) Identification of Materiality
Discussed the draft materiality prepared based on the assessment above at the Meeting for
Promotion of Sustainability established at MTAM, and identified materiality of MTR.

7

2. Policies and Management Structure

Relevance of Materiality to SDGs
The relevance of the materiality of MTR identified in accordance with the materiality
identification process to the SDGs is as follows:82. Policies and Management Structure▮ Meeting for Promotion of Sustainability
Meetings for promotion of sustainability are held regularly to ensure that the Sustainability Policy isimplemented and the sustainability goals are achieved.

Attendees•

President & Director (Chief Officer with the authority to make final decisions on matters related
to promotion of sustainability)•

Other Directors•

General Manager of Strategic Management Departments and Investment Departments(Operating Officers of matters related to promotion of sustainability)•••

General Manager of Business Administration Department
Compliance Officer
Other members whose attendance is considered necessary by operating officers

Details of Discussions and Reports, Frequency of Meetings and Examination
Process
At meetings for promotion of sustainability, policies regarding sustainability are established, revisedor abolished, and a range of measures that should be taken in line with the Sustainability Policy are
discussed and reported.
Meetings for promotion of sustainability are held four times a year. We are working on
continuous improvement through the repetition of the PDCA cycle, including the examination andplanning of measures, the reporting and evaluation of progress, the analysis of results, and theexamination and planning of improvement measures.
Matters discussed at the meetings for promotion of sustainability are to be decided upon andimplemented according to MTAM's Rules Regarding Administrative Authorities.

▮ Employee Training on Sustainability
To spread the awareness of sustainability among employees, employee training on sustainability isprovided periodically by inviting outside consulting companies as part of the environmental educational
and awareness-raising activities.

92. Policies and Management Structure▮ Initiatives for Human Rights
Based on "Respect for Human Rights" in the Sustainability Policy, MTAM supports and respects thehuman rights policies stipulated in international principles such as the Universal Declaration of Human
Rights, the ILO Declaration on Fundamental Principles and Rights at Work, and the Guiding Principles
on Business and Human Rights, and promotes measures to respect human rights.
MTAM has established the following rules to be complied with by MTAM. Such compliance rules
apply to all officers and employees of MTAM involved in the asset management of MTR. In addition,
various stakeholders including our business contacts are also expected to respect human rights intheir business related to MTR.

(1) Prohibition of Discrimination and Harassment
We respect the human rights and personality of individuals, and never engage in discriminatory
behavior or conduct that leads to sexual or power harassment on the grounds of gender, age,nationality, race, ethnicity, creed, religion, sexual orientation, gender identity, social identity,
physical disability, etc.

(2) Prohibition of Child Labor and Forced Labor
We support and practice the effective abolition of child and forced labor. We also observe theminimum working age stipulated by law and do not force workers to work against their will.

(3) Respect for Freedom of Association and the Right to Collective Bargaining
We support and respect the freedom of association and the right to collective bargaining inaccordance with law, and do not discriminate in hiring, promotion, dismissal, or transfer
decisions.

(4) Controlling Excessive Working Hours and Overtime
We comply with labor-management agreements (36 employee-employer agreement) regarding
overtime work and make efforts to control excessive working hours and overtime work.

(5) Payment of Wages Equal to or Above the Minimum Wage
We pay our employees wages equal to or above the minimum wage stipulated by law to ensure
the stability of their livelihood.

(6) Compliance with Equal Pay for Equal Work
We prohibit unreasonable differences in treatment between regular and irregular workers inaccordance with law.
MTAM identifies negative impacts on human rights in the asset management of MTR, andcontinues to implement measures to prevent and improve various issues related to human rights.
In addition, there has been no material violation of laws and ordinances regarding the rules.

▮ Information Disclosure and Communication
To build good relationships and communicate with stakeholders such as our unitholders, tenants andsuppliers , MTAM widely disseminates information about the sustainability policy and the status ofsustainability initiatives through MTR’s financial results presentation materials, asset management
reports, its website and press releases.

10

2. Policies and Management Structure▮ GRESB Real Estate Assessment
GRESB Real Estate Assessment is an annual benchmarking assessment founded by a group of major
European pension funds to measure ESG (Environmental, Social and Governance) integration of realestate companies and funds. The assessment is used by major institutional investors in Europe, theUnited States and Asia for selecting investment destinations and engaging with investees.
In the 2023 GRESB Real Estate Assessment, MTR received “3 Stars” in GRESB Rating, which isbased on GRESB Overall Score and its quintile position relative to global participants. It also won“Green Star” designation by achieving high performance both in “Management Component” that
evaluates policies and organizational structure for ESG promotion, and “Performance Component”
that assesses environmental performance and tenant engagement of properties owned.

MTR received the highest “A level” for the five-grade GRESB Public Disclosure, which assesses thewidth of ESG disclosure practices in connection with environmental and sustainability initiatives.

112. Policies and Management Structure▮ (Reference) Mori Trust Group's vision for promoting sustainability* Almost all officers and employees of MTAM are seconded from MORI TRUST CO., LTD.

Under the slogan "from urban planning to future planning," the Mori Trust Group has identified
seven priority themes for the sponsor group's pursuit of sustainability and has set out actionplans for realizing harmony between the economy, environment and society.
Seven priority
themesAction Plans

Safety andsecurity

・Creation of sustainable spaces for activity through the realization of regional disastermanagement and BCP
・Provision of peace of mind to meet the needs of the times, including infection control
measures using new technologies
・Promotion of regional and social development and growth in collaboration with various
stakeholders

Environment

・Urban development through the protection of landscapes and biodiversity and thesustainable use of resources
・More widespread use and more stable supply of renewable energy
・Proper collaboration with various stakeholders

Work/Lifestyles

・Provision of facilities and services for enhancing work-life balance
・Creation of lifestyle diversity through new businesses
・Implementation of new work styles and proposals/giving-back of new work styles tosocietyInnovation

・Development of industry through investments and partnerships
・Optimization of supply chain though the utilization of digital data and advanced
technologies
・Establishment of group structure which encourages the proposal and implementationof ideas

Wellness

・Provision of spaces which contribute to sustainable improvement in people's healthand wellbeing
・Creation of dining and accommodation experiences to nourish mind, body and soul
・Realization of health and productivity management on a society-wide basis

Diversity

・Promotion of international exchanges and multilingual service
・Establishment of management base which enables diverse human resources toplay an active part

Compliance
Governance・Continuous improvement in governance to help revitalize the economy
・Strengthening of risk management to support sustainable corporate activities

For details of Mori Trust Group's vision for promoting sustainability, please refer to the following
https://www.mori-trust.co.jp/sustainability/ (Japanese only)

12

３．Climate Change Initiatives▮ Awareness of Climate Change
MTAM recognizes that climate change is an important issue that brings about dramatic changes to thenatural environment and social structures, and has a serious impact on their operations as well as
businesses overall. The background to this is global trends in greenhouse gas emissions regulations,such as the Paris Agreement adopted in 2015, and the progress of climate change as a scientific fact
presented in reports such as the IPCC Special Report*. The Paris Agreement aims to limit global
average temperature increase to below 2°C compared to pre-industrial levels, and below 1.5°C as aneffort target. International frameworks and domestic regulations to reduce greenhouse gas emissions
are expected to be toughened in the future as a result of this. MTAM also recognizes climate change
as a scientific fact, and takes the position that measures to address the spread of natural disasterdamage caused by climate change—such as intensifying typhoon damage, frequent heat waves, anda rise in global sea levels—are essential.
MTAM formulated a Sustainability Policy in March 2017, and has since been working to improve
investor value in the medium to long term, through initiatives to improve sustainability. In March
2021, we formulated a list of material issues relating to MTR, and recognized responses to climatechange and resilience as important issues by including them in this list.
(Note) The IPCC Special Report on Global Warming of 1.5 ºC published in 2018 by the Intergovernmental Panelon Climate Change (IPCC).

▮ Declaration of Support for the TCFD Recommendations
MTAM recognizes that climate change is a serious risk that threatens financial stability. In recent years,
many stakeholders—primarily investors—are demanding disclosure of information on the financial
impact of climate change.
Based on this recognition, In March 2022, MTAM declared its support for the recommendations
announced in June 2017 by the Task Force on Climate-Related Financial Disclosures (TCFD),
established by the Financial Stability Board (FSB).
In order to secure MTR's sustainable and stable profitability in the long term, it will be essential for
MTAM to enhance the resilience of its businesses by identifying, assessing and managing risks andopportunities that may be brought about by climate change. We will expand disclosure of informationon these risks and opportunities in the future, in line with the TCFD recommendations.

13

３．Climate Change Initiatives▮ Governance on Climate Change
MTAM has established the following organizational governance system to respond to climate changerelated risks and opportunities and promote and supervise initiatives related to climate change.

Chief Executive Responsible for Response to Climate Change
President & Director (Chief Officer with the authority to make final decisions on matters related topromotion of sustainability)

Executive Officer Responsible for Response to Climate Change
General Managers of the Strategic Management Department, Investment Management Department
and Business Administration Department

Matters for Discussion and Reporting at the Meetings for Promotion of
Sustainability••

Identification and assessment of impacts of climate changeManaging risks and opportunities••

Progress of adaptation and mitigation initiatives
Climate change responses such as setting metrics and targets

For details of the Meetings for Promotion of Sustainability, please refer to page 9 of this report.

▮ Strategies
MTAM conducted a scenario analysis of climate change for MTR's portfolio to determine whichclimate-related risks and opportunities could have material financial impacts and to assess thefinancial impacts.

Reference Scenarios Used in the Scenario Analysis
1.5-2℃ scenario

4℃ scenario

Transition risks IEA NZE2050 scenario

IEA STEPS scenario

Physical risks

IPCC RCP8.5 scenario

IPCC RCP4.5 scenario* IEA:International Energy Agency, IPCC:Intergovernmental Panel on Climate Change

14３．Climate Change Initiatives

Determined Climate-related Risks/Opportunities and Assessment of the
Financial Impacts
Financial Impact
Category

Risk and Opportunity Factors

Policy and Law

Toughening taxation on GHG emissions
by introducing a carbon tax
Toughening of energy conservation
standards leading, obligations to reportemissionsTechnology

Transition

Evolution and widespread adoption ofrenewable energy and energy-saving
technologies

Markets andReputations

Change in social values relating toenvironmental performance
Changes in tenants and users demand(growing needs / demand forenvironmental performance)

Risks and
Opportunities

4℃ Scenario

2-1.5℃ Scenario

Medium-term

Longterm

Medium-term

Longterm

Risks

Low

Low

Medium

High

Risks

Low

Low

Medium Medium

Opportunities

Low

Low

Risks

Low

Low

Opportunities

Low

Low

Risks

Low

Risks

Low

Low

Low

MediumOpportunities

Low

Low

Low

MediumLow

MediumMedium Medium

Low

Low

Medium Medium Medium

Acute Risks
Chronic Risks

PhysicalDamage to properties caused by winddamage from typhoons

Risks

Medium Medium

Low

MediumInundation due to inland flooding and toflooding of nearby rivers caused byintensive heavy rainfall

Risks

Medium Medium

Low

MediumProgressive rise of sea levels

Risks

Low

MediumLow

Low

Impact of tourism resources

Risks

Low

MediumLow

Low

Increase in extreme climatic conditions,such as extremely hot and cold days

Risks

Low

Low

Low

Low

*Timeline: Mid term (–2030), long term (–2050)

MTAM has determined that climate change carries medium to long-term risks, but at the same time
also sees them as a chance to create new business opportunities.
Based on this scenario analysis, we will continue working to improve the resilience of MTR's asset
management operations.

For examples of climate change initiatives, please refer to page 17 - 18 of this report.

15

３．Climate Change Initiatives▮ Climate Change Risk Management
MTAM identifies, assesses, and manages climate-related risks under the following framework to
reduce climate-related risks.

Process for Identifying and Assessing Climate-Related Risks
MTAM regularly reports the results of the identification and evaluation of the impacts of climate change
to the Meetings for Promotion of Sustainability.
For details of the Meetings for Promotion of Sustainability, please refer to page 9 of this report.

Processes for Managing Climate-Related Risks
Climate-related risk management is integrated into and properly managed based on the companywide risk management programs.
For outline of the company-wide risk management program, please refer to “Risk Management
Initiatives ” on page 46 of this report.

▮ Metrics and Targets
MTAM sets metrics and targets to monitor its efforts to reduce the impact of climate-related risks andactualize opportunities to create new business chances. The goals currently set by MTAM in relation
to climate change issues are introduced below, along with corresponding achievements.
For details of the Metrics and Targets, please refer to page 21 of this report.

16

４．Environmental Initiatives
MTAM is working to reduce the environmental impact of the portfolio of all the properties held byMTR(excluding land with leasehold interest) in accordance with “Promoting energy saving and GHGs
emission reduction” and “Contributing to recycle-oriented society,” which form part of its
sustainability policy.

▮ Environmental Management System (EMS)
MTAM has built an environmental management system to promote energy saving, reduction ofgreenhouse gas (GHG) emissions, and effective use of resources.
MTAM sets targets for energy consumption, GHG emissions, water consumption, and amount ofwaste generation, observes the results, carries out plan-and-result management, and takes measures
to contribute to the creation of a sustainable recycling society through the reduction of theenvironmental burden.

▮ Examples of Environmental Initiatives
Introduction of LED Lighting
MTR introduced LED lighting and lighting equipment with human sensors successively in rooms
for rent and common areas of the properties held. Energy saving activities for reducing theenvironmental burden are promoted.
(Examples of introduction)• Tokyo Shiodome Building• ON Building• Kioicho Building• Kamiyacho Trust Tower• Sendai MT Building• Osaki MT Building• Midosuji MTR Building• Hiroo MTR Building• Tenjin Prime• Shin-Yokohama TECH Building• SHIBUYA FLAG

• Ito-Yokado Shonandai• Park Lane Plaza• Hashimoto MTR building• Hotel Okura Kobe
• Shangri-La Tokyo• Hilton Odawara Resort & Spa• Courtyard by Marriott Tokyo Station• Courtyard by Marriott Shin-Osaka Station• Hotel Sunroute Plaza Shinjuku

17

４. Environmental Initiatives
Introduction of Highly Efficient Heating Systems/Renewal of air-conditioning systems
MTR is working on increasing comfort and reducing CO2 through the introduction of highly efficientheating systems whose energy efficiency is excellent and renewal with highly efficient air-conditioning
systems whose energy saving performance is high upon the replacement of air-conditioning systems.
(Examples of introduction)• Tokyo Shiodome Building• ON Building• Kioicho Building• Kamiyacho Trust Tower• Osaki MT Building• Midosuji MTR Building• Hiroo MTR Building• Tenjin Prime• Shin-Yokohama TECH Building• SHIBUYA FLAG
• Ito-Yokado Shonandai• Hashimoto MTR building• Park Lane Plaza• Hotel Okura Kobe

• Shangri-La Tokyo• Courtyard by Marriott Tokyo Station• Courtyard by Marriott Shin-Osaka Station

Promotion of zero CO2 emissions from electricity usage

MTR is promoting the use of CO2-emission free power through the use of non-fossil certificates, etc.
(Examples of introduction)• SHIBUYA FLAG （RE100 initiatives）

・ Courtyard by Marriott Tokyo Station （RE100 initiatives）

Introduction of Building Energy Management Systems (BEMS)
MTR is working to introduce building energy management systems (BEMS) in the properties it owns
to measure the energy efficiency of entire buildings, thereby achieving energy saving and creating
optimal indoor environments.
(Examples of introduction)• Kamiyacho Trust Tower

・ Courtyard by Marriott Tokyo Station

Introduction of smart meters
MTR is focusing on the efficient use of energy by utilizing smart meters to understand details such as
the amount of power that is consumed and the time it is consumed.
(Examples of introduction)
・Kamiyacho Trust Tower

・Sendai MT Building

・Osaki MT Building

Water-saving through reduction of water consumption and toilet equipment renewal
MTR is working to conserve water in the common areas of the properties it owns by installing automatic
sink faucets and replacing hygiene equipment with products with high water-saving performance.
(Examples of introduction)• Tokyo Shiodome Building• ON Building• Kioicho Building• Kamiyacho Trust Tower• Osaki MT Building• Midosuji MTR Building• Hiroo MTR Building• Shin-Yokohama TECH Building• Tenjin Prime• Ito-Yokado Shonandai• Hotel Okura Kobe
• Shangri-La Tokyo• Hilton Odawara Resort & Spa• Courtyard by Marriott Tokyo Station• Hotel Sunroute Plaza Shinjuku

Properly Dealing with Environmental Issues such as Contamination(Brownfield Redevelopment)
When acquiring real estate, assessing beforehand whether there are harmful substances such as PCBs
or asbestos, soil contamination or other environmental issues is an integral part of the process.
We deal with any issues with real estate held such as the presence of harmful substances throughappropriate measures, management or treatment in accordance with laws and regulations.

Example: Frespo Inage (Land with leasehold interest)
In this property, soil contamination was confirmed before the purchase of the land by theInvestment Corporation, but the previous owner had carried out land purification measures.
After implementing the measures and completing the countermeasure work, the certification was
obtained after confirming that the work was being carried out properly in accordance with laws andregulations.
18

４. Environmental Initiatives▮ Collaboration with Tenants and Suppliers
Introduction of green lease
MTR and tenants have concluded an agreement of understanding for a green lease, aiming to reduce
the environmental burden. Information sharing about electricity, gas and water consumption anddiscussions on the improvement of environmental performance will be conducted on a regular basis.
In addition, MTR has introduced an initiative where MTR will carry out energy-saving installation workin the units of some tenants at Osaki MT Building and Kioicho Building at MTR's own expense and a
portion of the installation costs will be returned as green lease payments from the tenants.

Reduction of waste
When carrying out construction work, MTR is continuously working to reduce waste in collaboration
with contractors. Hotel operators are striving to reduce waste and be environmentally conscious byusing paper straws, discontinuing the use of individually packaged shampoo and reducing food loss at
the hotels we manage.

Supply chain management
When selecting a property management company, MTR assessed the candidates’ activities related tosustainability in addition to their facility operation and management, lease operation and management,
and leasing operations.

ESG Awareness-Raising in Backyards
The hotel operator of Courtyard by Marriott Tokyo Station
educates hotel employees on energy conservation and other
ESG issues, for example displaying posters in the backyard.

19

４. Environmental Initiatives▮ Environmental Considerations for Redevelopment
Protection of Biodiversity
ON Building and Osaki MT Building, which are owned by MTR, have formed Osaki Business Garden, alarge-scale redevelopment project. The site has an open space full of greenery, worthy of the name"Garden", and contributes to symbiosis and coexistence with nature and the protection of biodiversity.
The Kamiyacho Trust Tower provides a comfortable green space and a waterfront terrace forwaterscape relaxation, among other facilities. We conserved a large camphor tree, which is more than
100 years old, by transplanting it within the premises with the traditional tatebiki (tree sliding) method,
creating a biodiversity-conscious biotope in the 5,000-square-meter green space that offers the area's
original landscape.

A comfortable green space and a waterfront
terrace for waterscape relaxation（Kamiyacho Trust Tower）

Initiatives to vitalize communities and improve the quality of the urban
environment
Our sponsor MORI TRUST CO., LTD. has formulated the Kamiyacho God Valley Vision as its vision for
new urban development in the Kamiyacho area of Toranomon in Minato Ward, which is being
development as a new international hub of Tokyo and work to vitalize the communities. Specifically,
global and advanced companies and organizations with ties to Kamiyacho and the local town council
come together to regularly hold "TOKYO God Valley WEEK" and "Food Festival" which offer content forpeople from all walks of life, including world sports, entertainment, technology, area history and culture,
wellness, food, and more.

20

４. Environmental Initiatives▮ Environmental Performance Data
Environmental Performance Targets
MTAM has set reduction targets for total CO2 emissions, energy consumption and water consumption
across the portfolio, as shown below. MTAM has set its targets for CO2 emissions reduction, bearing in
mind the Japanese government target of reducing CO2 emissions in fiscal 2030 by 46% from their levelin fiscal 2013.
* Moreover, based on the merger of MORI TRUST Sogo Reit, Inc. and MORI TRUST Hotel Reit, Inc. on March 1,
2023, the environmental performance targets were revised.

（2025 Target）* Energy:Electricity, gas, fuel, DHC, etc. / Water supply and recycled water* Baseline:FY2018 (Total of portfolio of former MORI TRUST Sogo Reit, Inc. and former MORI TRUST Hotel Reit, Inc.)* Rate is consumption rate or emissions rate per unit floor area. Adjusted based on the period of holding andutilization rate of each property.

All reduction targets set for FY2016 to FY2020 have been achieved, as shown below.
Item
CO2
EnergyWater

Medium to long term
(five years from FY2016 to FY2020)
5% reduction in intensity
compared to Baseline
Maintenance of the status quo

Reductions achieved(as of end of FY2020)
Minus 28.6%
Minus 22.6%
Minus 44.0%

Environmental Performance Data
unit
Baseline
2021
2022
2023
Emissions
thousand t-CO2
49.61
25.42
32.47
30.61
Scope1 (Direct emissions)
thousand t-CO2
－
0.60
0.51
0.58
CO2
Scope2 (Indirect emissions)
thousand t-CO2
－
2.59
2.59
2.33
Scope3 (Tenants' emissions)
thousand t-CO2
－
22.21
29.36
27.69
Emissions intensity
t-CO2/㎡
0.094
0.064
0.066
0.060
Consumption
MWh135,194
75,540101,290108,916
EnergyConsumption intensity
MWh/㎡
0.256
0.189
0.207
0.213
Consumption㎥
841,023
282,065
614,232
693,111
Water
Consumption intensity
㎥/㎡
1.594
0.706
1.256
1.355
*Excluding properties (dedicated areas of residential houses, etc.) the data for which cannot be easily assessed, although allproperties owned by MTR are included for the compilation of data (excluding land with leasehold interest, etc.)*Scope 3: Emissions from areas under the management of tenants (Category-13)*Aggregation period is one year from April 1 each year to March 31 of the following year.
*CO2 emissions, energy consumption (excluding scope 3) and water consumption (water withdrawal) have been verified byan independent third party. In FY2023,
we obtained an assurance report from Sustainability Accounting Co., Ltd.
*Figures for FY2021 is for the former MORI TRUST Sogo Reit, Inc.

▮ Management of waste
We are working on the continuous reduction of waste by properly managing waste in our portfolio.
Item
Total amount of waste (t)

2023
3,201

*Excluding properties (residential houses, etc.) whose data cannot be easily assessed.
*Aggregation period is one year from April 1 each year to March 31 of the following year.
*Obtained third-party assurance report from Sustainability Accounting Co., Ltd..

21

４. 環境への取組み▮ Green Finance
MTAM is committed to “Promoting GHGs emissions reduction and energy saving”, “Contributing torecycle-oriented society”, “Responding to climate change and improving resilience”, “Disclosing ESG
information” as stipulated in sustainability policy. MTAM has formulated a green finance framework withthe aim of further promoting ESG investment and strengthening funding base of MTR by expanding thenumber of investors and lenders interested in ESG investment and financing.

Grenn Finance Framework(Use of Funds Procured)
Funds procured of the green finance will be used for the acquisition of assets that meet the following
eligibility criteria (“the Eligible Green Projects”) for the repayment and redemption of loans orinvestment corporation bonds that were required for acquisition of assets that meet the Eligible Green
Projects or for repair work that meets the Eligible Green Projects, etc.

(Eligibility Criteria)(1) Green Buildings
Any assets with the following valid certifications that have already been obtained or updated orare planned to be obtained or updated in the future.
① Three, Four or Five stars by DBJ Green Building Certification② B+, A or S Rank by Certification for CASBEE for Real Estate③ Three, Four or Five stars by BELS Certification④ Silver, Gold or Platinum by LEED Certification⑤ Stage 2 or higher in both heat insulation capacity of the building and energy-saving
capability of the equipment systems of Tokyo Metropolitan Government’s Environment
Performance Certificate Program. (Included in AA or higher in both heat insulation capacityof the building and energy-saving capability of the equipment systems of Tokyo Metropolitan
Government’s Energy Performance Certificate Program (2017 standards))⑥ Properties that qualify as ZEB (Net Zero Energy Buildings)(Properties that fall under any of definitions of ZEB, Nearly ZEB, ZEB Ready, or ZEB Oriented)(2) Renovations on owned assets that meets any of the following criteria:① More than 30% reduction in CO2 emissions or energy consumption② More than 30% reduction in water consumption③ Equipment renovations aimed at making environmentally beneficial improvements.
(In principle, the renovation that is expected to reduce usage by 30% or more compared toconventional products)④ More than one level of star/rank improvement in the green building certifications listed in
Eligibility Criteria [1]⑤ Installation, introduction, and acquisition of renewable energy-related equipment on thepremises of owned assets22

４. 環境への取組み(Process for Project Selection)
The selection process for property acquisition, renovation, equipment installation, etc. that meetsthe eligibility criteria is as follows.
Projects for which the procured funds will be used (property acquisition, renovation, equipment
installation, etc. that meet the eligibility criteria) will be examined for compliance with theeligibility criteria by the Strategic Management Department of MTAM. When procuring funds
through green finance, the process goes through the following process in the same way as
regular finance (execution of borrowings, issuance of investment corporation bonds).
<In the case of green loan>
It will be approved by managing director in charge of the Strategic Management Department of
MTAM and will be approved and executed by president and representative director.
<In the case of green bonds>
It will be approved and executed by the Board of Directors of MTR (if a comprehensive
resolution regarding the issuance of investment corporation bonds was passed by the Board of
Directors of MTR, it will be executed after the approval of the executive director of MTR).
Furthermore, after-the-fact reports will be made at the Meeting for Promotion of Sustainabilityof MTAM, which is held four times a year, regarding the procurement of funds through green
finance for targeted projects.

(Allocation Plan)
After funds procured of the green finance are deposited into MTR’s account, it will be allocated toacquire the assets that meet the following eligibility criteria (Eligible Green Projects), to refinanceexisting loans or to redeem investment corporation bonds (including green bonds) already issued.

Reporting(Allocation Reporting)
The allocation plan and the following items will be disclosed once a year on the MTR’s website
until the green finance proceeds are fully allocated.
・ The balance of green finance procurement
・ The limit of green eligible debt
・ The status of green finance allocation
・ If there are unallocated funds, the unallocated amount and expected allocation date.

23

４. 環境への取組み<Funds status>（As of February 29, 2024）
Procurement The unallocatedamountbalance(million yen)
Green Finance

Schedule of Expenditure

1,000

1,000

Green Bonds

1,000

1,000 Allocated in April 2024

Green Laons-

The limit of green eligile debt-

90,047(Impact Reporting)
The following items will be disclosed on MTR’s website once a year to the extent practicable.
Eligibility Criteria (1)Eligibility Criteria (2)・Types and Evaluations of certification of acquired assets
・In the case of renovation intended to reduce CO2 emissions, energy consumption,water consumption, etc.
Reduction rate of CO2 emissions, energy consumption, water consumption, etc.
・In the case of renovation intended to raise the certification rating by one level ormore or obtain new environmental certification.
Types and Evaluations of certification of acquired assets.
・In the case of installation, introduction, and acquisition of renewable energy-related
equipment.
Power generation and CO2 emissions.

<Types of certification of acquired assets and evaluation status of them>
For information on the acquisition status of green building certifications, energy-saving
performance ratings, etc., please refer to page 25 of this report.
Furthermore, for information on CO2 emissions, energy consumption, and water consumption
for the entire portfolio, please refer to page 21 of this report.

(Evaluation by External Organization in green finance framework)
MTR has received the highest overall rating of “Green 1” from Japan Credit Agency, Ltd. (JCR),
which is a green finance rating agency, regarding the eligibility of the green finance framework.

24

４. Environmental Initiatives▮ Acquisition of Environmental Certification and Evaluation
The ratio of certified properties in the portfolio, excluding land with leasehold interest, is 65% on anumber of properties basis and around 57% on a leasable area basis, as of March 31, 2024.

DBJ Green Building Certification

★★★

★★

Properties with exceptionallyhigh environmental & social
awareness

Properties with excellent
environmental & social
awareness

Properties withhigh environmental& social awarenessKmiyacho Trust Tower (2023)

Tokyo Shiodome Building (2021)

ON Building (2023)

Kioicho Building(Residential)(2023)

Kioicho Building (Office) (2023)

Osaki MT Building (2021)★★★★

Midosuji MTR Building (2023)
SHIBUYA FLAG (Office) (2023)
SHIBUYA FLAG (Retail) (2023)★
Properties withhigh environmental& social awarenessShin-Yokohama TECH Building(2021)
Hiroo MTR Building (2022)
Tenjin Prime (2022)(Note) Figures in parentheses indicate the year of acquisition or reacquisition

Certification for CASBEE for Real Estate
Property nameIto-Yokado Shonandai

Certification rank

Rank S（Highest rank）

Tokyo Metropolitan Government’s Energy Performance Certificate Program
Property name
Kamiyacho Trust Tower
KYOBASHI TRUST TOWER(Courtyard Tokyo)

Heat insulation capacity
Of the buildingbuilding Energy-saving capabilityof the equipment systems

AAA

AAA

（Highest rank）（Highest rank）

Building-housing Energy-efficiency Labeling System (BELS) Certification
Property name
Hotel Sunroute Plaza
Shinjuku

Certification rank★★★
(2016 Ver.)25

５．Social Initiatives
MTAM aims to help improve tenant, hotel operator and hotel user satisfaction and contribute to thesustainable development of local communities by building good relationships with external
stakeholders related to the real estate MTR holds and cooperating and collaborating with them inaccordance with the “collaborating with external stakeholders” strand of its sustainability policy.

▮ Stakeholder Engagement
MTR and MTAM strive to build relationships with each stakeholder as described below as well as
engage in interactive communication. The following section introduces each of the initiatives taken
by MTR and MTAM for each stakeholder.

Stakeholders

Relationship with MTR and MTAM

Major Initiatives of MTR and MTAM

Tenants, PM
companies, Hotel
Operators andOther Business
Partners(Suppliers) (Note)• Sustainability-conscious collaboration
systems• Tenant Safety and Comfort Initiatives

Hotel Users• Responding to the needs of hotel users• Safety and comfort initiatives for hotel users• Conduct detailed communication with tenants
and hotel operators• Hold ESG Seminars with the Participation of HotelManagement Parties• Building collaboration systems with hotelmanagement parties and other business partners(suppliers)• Ensuring a safe and comfortable hotel
stay
Local
Communities• Contribution to local communities• Organization and participation in local events• Local volunteer activities• Cooperation with local communities• Activities for social issues• Disaster response

Employees

Investors andLenders• Human resource development to realize
more sophisticated asset management
operations• Provide a healthy, comfortable andpleasant work environment• Initiatives for human resource development• Proactive information disclosure• Implement timely and appropriate information
disclosure, including ESG information• Hold financial results briefings and individual
meetings with domestic and overseas institutional
investors• Communication through IR activities• Initiatives for Well-Being (health and comfort)• Securing highly specialized human resources(Note) “PM Companies" refers to property management companies and “Other Business Partners (Suppliers)"
refers to, for example, construction companies, etc. “Hotel Operators" includes hotel managementcompanies.

26

５. Social Initiatives▮ Improvement of tenant, property management company, hotel operator andother supplier satisfaction and comfort etc.
Improvement of Tenant Comfort
We carry out various work to improve tenant comfort, including renovating common areas andcreating barrier-free access. We also regularly conduct air environment measurements to maintain
good air quality in office spaces.

Entrance hall renewal work
(Shin-Yokohama TECH Building)

Improvement of Tenant Safety and Security
MTR works on the safety and security of tenants and visitors. In order to strive to provide buildings
and services that give consideration of tenants and visitors, MTR works on disaster prevention and
BCP such as a regular anti-disaster drills, Installation of emergency power supply systems, andemergency stockpiling.

（Examples of major initiatives）
・ Free provision of storage space for emergency supplies to tenants
・ Installation of emergency power source equipment
・ Renovation work for universal design
・ Installation of emergency boxes in elevators
・ Disaster toilet stockpiling・ Separation of smoking and non-smoking areas
・ Provision of AEDs

Conduct Satisfaction Surveys of Tenants/Hotel Operators
MTAM regularly conducts satisfaction surveys of tenants and hotel operators regarding theoperation of the properties. The results of the survey are used as reference for MTAM's property
management and also shared with property management companies, etc. for the purpose of
improving property management.

27

５. Social Initiatives

Hold Regular Meetings with Tenants/Hotel Operators
Regular meetings are held with tenants and hotel operators regarding hotel operations, etc. At theregular meetings, hotel operation and property management policies are shared among the parties
concerned, and progress management is regularly implemented to optimize hotel operations.

Hold ESG Seminars with the Participation of PM and Hotel Management Parties
For the purpose of deepening the knowledge of ESG to promote the Sustainability Policy to allparties concerned, ESG seminars are held by external lecturers with the participation of hotelmanagement parties.

Building Collaboration Systems with Hotel Management Parties and Other
Business Partners (Suppliers)
In selecting and assessing hotel management parties and other business partners (suppliers), MTAM
considers the status of their sustainability initiatives as one of the criteria and confirms their systems
for environmental considerations and community contributions, as well as their cooperation with thesustainability initiatives of MTAM.

▮ Initiatives for Hotel Users
Hotel User Comfort Initiatives
In cooperation with hotel operators and property management companies, we are responding to
new customer needs such as converting some guest rooms into working spaces, while also
implementing initiatives for health, safety and hygiene, barrier-free access, etc.

Introduction of Pure Wellness Rooms
In response to social needs amid the COVID-19 pandemic, in addition to measures taken by each
hotel, Hilton Odawara Resort & Spa, Courtyard by Marriott Tokyo Station and Courtyard by
Marriott Shin-Osaka Station have made some guest rooms “Pure wellness rooms” which provide ahigh-quality clean air environment and have been introduced in hotels around the world.

28

５. Social Initiatives▮ Initiatives for Local Communities
Cooperation with Local Events
We endeavor to contribute to the sustainable development of local communities by participating invarious community development-related councils and participating in and cooperating with local
events, including financially contributing to the town management company of the Shiodome area inwhich Shiodome Building is located and signing a local townscape planning agreement designed to
improve the value of the Midosuji area in which Midosuji MTR Building is located and organizing“Christmas Train” as a charity event every year, in 2020, part of the sponsorship money was donatedto each elementary and junior high school in Odawara City as well as orphanages, their supporting
NPOs and elderly welfare facilities.

Midosuji Illuminations(Midosuji MTR Building)

Hold a charity event " Christmas Train"(Hilton Odawara Resort & Spa)

Cooperation with Local Communities
From the perspective of contributing to local society and communities, MTAM requires its employees
to take a small part of their working hours for participation in cleaning activities carried out in the
Shibuya area where properties owned by MTR are located.
Hilton Odawara Resort & Spa carried out the following local volunteer activities.
・Cleanup activities around Odawara Castle
・Food bank distribution to single-parent families in Odawara City five times a year
・Material support for areas affected by the Atami-Izusan landslide
・Accepting work experience (internships) from local junior high schools
In addition, We make part of the sites of real estate owned by MTR available for the installation ofcycle ports for shared bicycles. Hilton Odawara Resort & Spa installed a station for eemo, an ecofriendly electric vehicle car-sharing service. The eemo service supports not only transportation but
the community by running mainly on locally generated electricity in normal times and serving as
emergency power sources during disasters. In addition, Hilton Odawara Resort & Spa provides free
hotel shuttle bus service on days when local elementary school has morning classes as an alternativemeans of transportation for children in leaving school in place of the reduced public bus service.

Cleaning Activities
around Shibuya area
(SHIBUYA FLAG)

Provision of community
cycle system(Kioicho Building)Accepting work experience(internships)(Hilton Odawara Resort & Spa)

eemo Station(Hilton Odawara Resort & Spa)29

５. Social Initiatives▮ Activities for social issues
Cooperation in Zero Emission Tokyo Strategy
To cooperate with the Tokyo government in the Zero Emission Tokyo program targeting zero CO2emissions by 2050, the Company donated CO2 reduction credit of 15,007 points to the Tokyo
government in October 2020 based on Tokyo Cap-and-Trade Program.

Participation in “EARTH HOUR2024”
Courtyard by Marriott Shin-Osaka Station and Hilton Odawara Resort & Spa participated in EARTH
HOUR 2024, a global event organized by WWF (World Wide Fund for Nature) to demonstrate thewill to prevent global warming.

Cooperation in the activities of the Japanese Red Cross Society
As a gesture of its endorsement of the activities of the Japanese Red Cross Society, MTR has been
cooperating with the educational activities of the Red Cross by displaying its posters in owned
properties.

Participation in “Pink Ribbon” movement
Hilton Odawara Resort & Spa participated in "Pink Ribbon Light Up 2023 in Kanagawa" and served
meals with pink ribbons, to spread awareness about the importance of early detection and treatmentof breast cancer and taking breast cancer screening exams.

Pink Ribbon Light Up 2023 in
Kanagawa

Serving meals withpink ribbon▮ Disaster Response
Implementation of Disaster Drills
We regularly conduct disaster drills in collaboration with Hotel operators at properties owned by
MTR in an effort to increase disaster prevention awareness.

Collaboration with Sponsor GroupMTR has concluded a Basic Agreement Concerning Cooperation for Large-scale Disaster Response,
etc. with Mori Trust Group Companies to strengthen cooperation for large-scale disaster response.
MTR will cooperate with the sponsor group in areas such as human support, technical support,
physical support such as emergency supplies and the provision of disaster information in relation
to the properties owned by MTR, which entrusts management to Sponsor Group companies
pursuant to the Master Lease Agreement and the Property Management Service Agreement.

30

５. Social Initiatives(Reference) Initiatives for Local Communities by Mori Trust Group* Almost all officers and employees of MTAM are seconded from MORI TRUST CO., LTD.

Our sponsor MORI TRUST CO., LTD. has formulated the Kamiyacho God Valley Vision as its vision
for new urban development in the Kamiyacho area of Toranomon in Minato Ward, which is being
development as a new international hub of Tokyo.
Through initiatives such as the promotion of the SDGs in urban development, the creation of areasthat will encourage creativity, the adoption of the technologies of the future and next-generation
services, the formation of a diverse community and the staging of collaborative events in the area,
MORI TRUST CO., LTD. is working with the people of Kamiyacho to create the future.

SDGs -Realization of a Sustainable SocietyOur sponsor has adopted the SDGs-realization of a sustainable society, as one of the four pillars
for achievement of its Kamiyacho God Valley vision and, through initiatives with individualcompanies and groups for achievement of the SDGs, it is pushing ahead with urban developmentin each area and collaborating with local stakeholders to solve social issues.

For further details on the Kamiyacho God Valley Vision, please visit the URL below.
https://www.mori-trust.co.jp/co-creation/area_kamiyacho.html (Japanese only)31

５. Social Initiatives▮ Initiatives for Employees
In accordance with the provisions of the Act on Investment Trusts and Investment Corporations, MTR is
not allowed to recruit employees and the officers and staff of MTAM are responsible for its operation to
all intents and purposes. Entrusted with asset management by MTR, MTAM develops human resources
through initiatives such as those shown below in order to achieve a high level of asset management.
Since almost all officers and employees of MTAM are seconded from MORI TRUST CO., LTD. which is
the Asset Management Company’s sponsor, some items describe the initiatives of the sponsor company.

Initiatives for Human Resource Development

Support for the acquisition of professional qualifications

MTAM supports all officers and employees (including contract employees etc.) in acquiring various
professional qualifications, such as the Association for Real Estate Securitization (ARES) Certified
Master (an educational program that enables systematic learning of practical expertise in the realestate and financial fields) to improve their professional skills. MTAM also bears the costs related totraining and examinations for various professional qualifications to improve the professional skills of
officers and employees.
Training Program
The following training programs are provided by MTAM or the sponsor to develop skills appropriate
to the job and level of the employee.
(Training for all employees)
・ Compliance Training
・ ESG and DEI Training
・ Real Estate Finance Training
・ Harassment Prevention Training
・ Training for New Employee(Training by department)
・ Basic Training in Accounting and Taxation
・ Basic Training in Labor Management
・ Training in Real Estate Transaction Specialist
・ Basic Training in Energy Management etc.
(Training by job level)
・ Leadership Training (Management Training, Team-Building Training, Line Care Training)(Selective training)・ Training in ESG
・ Training in Real Estate Market
・ Training in Accounting and Taxation
・ Training in Laws and Regulations etc.
MTAM’s employees also take part in diverse human resource development programs prepared byMori Trust Co. Ltd., which is MTAM’s sponsor.

Sponsor’s Human Resource Development Programs
1

MT TALK

2

MT ACADEMYAs a means of creating company-wide change and reform, all employees
reflect seriously on the future vision of MORI TRUST and engage in lively
debates and communications on its ideal form.

Graded training programs, global training programs dedicated careeradvancement programs for female staff, MORI TRUST holds regular training
sessions and workshops related to new business knowledge and techniques.
These training sessions provide opportunities for mutual stimulation andpromote the growth of each and every employee.

32

５. Social Initiatives
Training Program
Officers and employees are regularly provided with training on themes such as sustainability,
compliance and protection of personal information.
Selective Training
・ Training in ESG・Certified Building Administrator

・ Training in Real Estate Market

・The Association for Real Estate
Securitization (ARES) Certified
Master・Licensed Real Estate Appraiser

・ Training in Accounting and Taxation
・ Training in Laws and Regulations

etc.

・Real Estate Transaction Specialist
・Licensed Architect

Training by department and job lebel

・Structural Engineer

By job lebel

By department

・Licensed electrical engineer
・Information Technology Engineer

・ Basic Training in Accounting and Taxation

Leadership Training

・ Basic Training in Labor Management

・ Management Training

・ Training in Real Estate Transaction Specialist・ Team-Building Training

・ Basic Training in Energy Management etc.

・ Line Care Training

・Certified Public Tax Accountant
・Certified Public Accountant
・Certiﬁed Member Analyst
・Certified Skilled Professional of
Financial Planning・English proficiency test
etc.

Training for all employees
ComplianceTraining

ESG and DEI
Training

Real Estate
Finance Training

Harassment
Prevention
Training

Training for
New Employee

Training Program

Qualification Support

Personnel Evaluation and Feedback
We conducts performance evaluations and reviews of all full-time officers and employees on a regularbasis. Through regular appraisal and feedback, we accelerate employees’ career development andbuild a transparent personnel evaluation framework.
In addition, all full-time officers and employees (including contract employees etc.) meet with theirsupervisors four times a year to set goals, confirm progress, and evaluate the degree of achievement.
All officers and employees set quarterly personal goals regarding the targets and results they should
aim for through their work, and at each meeting, they and their supervisors check the progress of
their personal goals and the degree to which they have achieved them, and revise their personal goals
as necessary.
The feedback system for personnel evaluations and the target management system described above
enhance the transparency and acceptability of evaluations, and encourage all officers and employees
to improve their abilities and motivation.

(Status of feedback interviews)
2021

2022

2023

Percentage of officers and employees covered by thegoal-setting evaluation system (%)

100%

100%

100%

Percentage of officers and employees who conducted
feedback meetings with their supervisors (%)

100%

100%

100%

Bonus
MTAM pays bonuses to all full-time directors and employees twice a year and has adopted a system inwhich a portion of the bonus is linked to performance evaluations.

33

５. Social Initiatives

Initiatives for Well-Being (Health and Comfort)
Promotion Diversity, Equity and Inclusion (DEI)
MTAM promotes diversity, equity, and inclusion (DEI) initiatives based on “Respect for humanrights and realization of a work environment that takes diversity, equity, and inclusion (DEI) into
consideration” which is stipulated by the Sustainability Policy so that each of our executives andemployees, regardless of gender, age, nationality, race, ethnicity, creed, religion, sexual
orientation, gender identity, social status, or physical disability, will be respected for theirindividuality and attribute differences and each individual can maximize his/her abilities.
In promoting DEI, the Director and President is the chief executive officer, and the General
Manager of the Business Administration Department is the operating officer.

Creation of Comfortable and Healthy Workplace Environment
We endeavor to create a healthy and comfortable workplace environment where employees(including contract employees etc.) can reach their full potential.
(Specific Examples)•

Leave and work restriction systems for•Child nursing care leave system

maternal health management•

Family care leave system(special leave, restriction of overtime•

Congratulation and condolence
allowance systemand holiday work)•

Spouse’s childbirth leave system•

Mental health support•

Maternity leave system•

Periodic health examinations•

Childcare leave system•

Use of Group hotels by members•Childcare time system (short working•

Hourly leave system, etc.

hour system, slide work system,•

Implementation of work from home andshift to online meetings, etc.

restriction of overtime and holiday work)34

５. Social Initiatives
Implementation of Employee Satisfaction Surveys
To ensure that each employee is respected and each individual can maximize their potential, MTAM
conducts an annual all employees (including contract employees etc.) satisfaction survey to identify
employees' opinions and requests. MTAM is also working to provide a healthier and more
comfortable working environment by formulating action plans to resolve areas for improvement
based on the results of employee satisfaction surveys. Specifically, MTAM introduces the following
measures to improve working environment.
・ Introduction of business casual・ Introduction of office BGM(Status of Employee Satisfaction Surveys)
Response rate (％)
Overall Satsfaction（Out of five）

2021
100%
3.6

2022
100%
3.5

2023
100%
3.7

Scheme for Listening to Complaints
We listen carefully to the complaints and frustrations of our employees in each workplace and takeappropriate steps through the whistleblowing system that is available to all officers and employees(including contract employees, and employees on loan or dispatched from other companies,
employees not running in a year from whistleblowing and officers) . We take measures to ensure thatno whistleblowers suffers retaliatory dismissal, disciplinary measures, or other detrimental treatment
because of their whistleblowing to ensure thorough protection of the privacy of whistleblowers.

Other Initiatives
Human Resources with High Levels of Expertise
We seek the achieve even more sophisticated asset management operations by accepting humanresources with extensive experience and high levels of expertise from our sponsor and the sponsor
group and leveraging their specialist skills.
In hiring personnel, the sponsor has established the following various human resource recruitment
and selection opportunities aimed at diversifying backgrounds and abilities.
・ Establish recruitment opportunities with an awareness of innovation abilities
・ Recruitment of global human resources and career recruitment through a wide range of channels
・ Creation of opportunities to try again in the recruitment process by setting up various recruitment
frameworks

Employment System for Older Persons
A system has been introduced to rehire employees who have reached retirement age and wish tocontinue working until the age of 65 in order to take advantage of their wealth of knowledge andexperience.

35

５. Social Initiatives
Personnel-related data
FY 2021
The number of officers and employees
MaleFemalePercentage of males (％)
Percentage of females (%)
Non-permanent employees suchas contract or temporary workers
Percentage of Non-permanent
employees such as contract or
temporary workers（％）
The number of officers
Male
FemalePercentage of males (％)
Percentage of females (%)
The number of management positions
Male
FemalePercentage of males (％)
Percentage of females (%)
Average years employed by the company (year)

Male
FemaleFY 2022

FY 2023

28
23
5
82%
18%

26
21
5
81%
19%

24
19
5
79%
21%

5

5

4

18%

19%

17%

4
4
0
100%
0%
6
6
0
100%
0%
6.7
6.8
6.2

6
6
0
100%
0%
5
5
0
100%
0%
7.3
7.7
5.7

4
4
0
100%
0%
5
5
0
100%
0%
7.3
7.7
6.1

＜The number of new hires, turnover, etc. of officers and employees(excluding officers and employees seconded from outside the company and temporary employees)＞

FY 2021
The number of new hires
Male
FemaleThe number of people who left the company

Rate of turnover (%)

0
0
0
0
0%

FY 202200014%FY 2023
1
1
0
4
15%

(Note) Rate of turnover = The number of employees who left the company in each fiscal year (excluding those who
returned to the dispatched company and those who left the company due to the termination of dispatch contracts) ÷ The
number of officers and employees as of April 1 of each year (including officers and employees seconded from outside thecompany, contract employees and temporary employees)

36

５. Social Initiatives(Reference) Initiatives for Employees by Mori Trust Group* Almost all officers and employees of MTAM are seconded from MORI TRUST CO., LTD.

MORI TRUST, the sponsor of MTAM, considers the work-life balance of its employees to help
maximize each employee’s abilities and strives to create a comfortable environment for them towork.
Promotion of Work-Life Balance and Women’s Participation
MORI TRUST has introduced various programs, such as childcare leave, to help employees
manage both their work and childcare.
（１）Female employment rate

28.8%（２）Female employee rate

27.2%（３）Female management position rate

8.0%（４）Rate of taking children leave

Male

66.7%

Female100.0%（５）Rate of paid leave taken

81.3%((1)(4)(5): FY2023, (2)(3): as of March 31, 2024)(Note) Figures shown in (1), (2) and (3) are calculated for employees employed by MORI TRUST CO., LTD. andfigures shown in (4) and (5) are calculated for employees assigned to MORI TRUST CO., LTD.

(Systems to Support Work-Life Balance)
Leave and work restrictions•

Childcare leave

for maternal health management•

Childcare time•

Spouse’s childbirth leave•

Child nursing care leave•

Maternity leave•

Family care leave•

Certification as a Childcare Supporting Company and Start of Childcare Business
MORI TRUST is recognized as a company supporting childcare and promoting women’s
activities by the Ministry of Health, Labour and Welfare (MHLW) and certified Platinum Kurumin
and Eruboshi (two stars).
MORI TRUST opened a company-sponsored nursery, Nursery Room Mirai’s, in Shiroyama Trust
Tower in November 2019, which is available for use of the building’s tenants and employees.

Implementation of Work-Style Reforms• Participation in "Time Difference Biz” led by the Tokyo Metropolitan Government• Uses telecommuting and mobile workplace• Introduction of “workations”
Health and Productivity Management
The company, employees, their families, and the health insurance society work together on
health management-related initiatives. These initiatives have been favorably received, and MORI
TRUST was certified as a “Health and Productivity Management Organization” in 2023 (Ministryof Economy, Trade, and Industry).

37

５. Social Initiatives▮ Initiatives for Investors and Lenders
Information Disclosure
We seek to protect investors, etc., by setting forth policies and procedures to ensure that MTR and
MTAM disclose information in a timely and appropriate manner in accordance with relevant laws andregulations. We have also set out the Information Disclosure Regulations to help maintain andimprove public trust in MTR and MTAM.
In accordance with the Companies Act, the Act on Investment Trusts and Investment Corporations,
the Financial Instruments and Exchange Act, the Tokyo Stock Exchange regulations, and otherapplicable laws and regulations, we endeavor to disclose to the public in a timely and appropriate
fashion information requiring disclosure in relation to MTR and MTAM and other information that will
help investors make investment decisions.

IR Activities
We communicate various useful information for investors via MTR’s website including timely
disclosure information, financial information, portfolio information, and information about ESG
initiatives and distributions.
We also post a video about financial results on the MTR’s website to keep investors informed
and hold Q&A sessions on financial results for each fiscal period (mainly for securities analysts andinstitutional investors) and provide explanations about MTR’s operations and forecasts.
In addition, we hold individual interviews with domestic and international institutional investors
and hold investment status reporting sessions for individual unitholding investors, in an effort topromote understanding of MTR's operations.

▮ Measures for Dealing with Complaints
MTAM has set forth the Regulations for Dealing with Complaints and Disputes, and strives to deal
sincerely and promptly with complaints and other requests from customers or others and toshow them understanding.

38

６．Governance Initiatives▮ Corporate Governance
MTR's Organization System
The organization of MTR consists of the General Meeting of Unitholders comprised of unitholders, one
Executive Director, two Supervisory Directors, the Board of Directors comprised of the Executive
Director and the Supervisory Directors, and the Accounting Auditor.

（a）General Meeting of Unitholders
Certain matters concerning MTR as set forth in the Act on Investment Trusts and Investment
Corporations ("Investment Trusts Act") or the Articles of Incorporation are decided by a resolutionof the General Meeting of Unitholders, which shall be composed of unitholders.
Unless otherwise stipulated in laws or the Articles of Incorporation, a resolution at the General
Meeting of Unitholders will be made by the majority of the voting rights of the unitholders present.
However, certain important matters, including amendments to the Articles of Incorporation, requirea resolution made by two-thirds or more of voting rights of unitholders present, provided thatunitholders holding investment units equivalent to majority of total investment units issued arepresent (special resolution).
With regard to all investment units issued, each unitholder holds voting rights at a ratio of one
voting right for each investment unit held by the unitholder.

（b）Executive Director, Supervisory Directors and the Board of Directors
The Executive Director executes the business of MTR and also has the authority to take any
judicial or extra-judicial acts related to the business of MTR on behalf of MTR. The Supervisory
Directors have the authority to supervise the conduct of business by the Executive Director. The
Board of Directors has the authority to approve the execution of specific responsibilities as well as
the authority set forth in the Investment Trusts Act and the Articles of Incorporation and theauthority to supervise the execution of duties by the Executive Director.
The appointment and dismissal of Executive Directors and Supervisory Directors is determined byresolution of a General Meeting of Unitholders in accordance with the provisions of the Act on
Investment Trusts and Investment Corporations and the Articles of Incorporation.

（Status of the Board of Directors）

As of February 29, 2024

Position

Name

Attendance（March 2023 - February 2024）

Exective Director

Hiroshi Naito

12 meetings／12 meetings（100％）

Naomasa Nakagawa

12 meetings／12 meetings（100％）

Harumi Katagiri

12 meetings／12 meetings（100％）

Supervisory Director(Note) At MTR, no meetings (committee meetings, etc.) equivalent to board meetings are held except for meetingsof the Board of Directors.

（c）Accounting Auditor
MTR has elected Ernst & Young ShinNihon LLC as the Accounting Auditor. The Accounting Auditor
will audit MTR's financial statements and other relevant material, report to Supervisory Directors
in the event of detection of a fraudulent act or material fact violating any law or the Articles ofIncorporation concerning execution of duties of the Executive Director and perform other duties
stipulated in laws.

39

６. Governance Initiatives

Chart of MTR's Organization System
Transfer Agent,
General Administrator of
Accounting and Asset
Custodian12

Sumitomo Mitsui
Trust Bank, Limited

General Administrator of
Investment Corporation
Bonds
MUFG Bank, Ltd.
Sumitomo Mitsui
Trust Bank, Limited
Mizuho Bank, Ltd.

MORI TRUST CO., LTD.

Asset Custody Agreement

3

Fiscal, Issuing and Payment
Agency Agreement

4

Asset Management Agreement

5

General Services Agreement

Board of Management
Executive Director:
Hiroshi Naito
Supervisory Director:
Naomasa Nakagawa
Supervisory Director:
Harumi Katagiri

6

Letter of agreement for theprovision of information onreal estate, etc.

7

Trademark Licensing Agreement

8

Letter of agreement for sponsor
supportAccounting Auditor
Ernst & Young
ShinNihon LLC

8General Meeting ofUnitholders

3

7

General Services Agreement(Administration of Registration
Share Issuance and Accounting)

2
MORI TRUST REIT, Inc.

6

Sponsor Company

1

MTR

4

(Administration of Organizational Operation)

Sponsor Company
Mori Trust Hotels& Resorts Co., Ltd.

5

Asset Management Company and General Administrator of Organizational Operations

MORI TRUST Asset Management Co., Ltd.

40

６. Governance Initiatives

Status of Directors
The status of the Executive Director and Supervisory Directors is as shown below.
Criteria that apply to the payment of remuneration to Executive Directors and Supervisory Directors
are specified in MTR's Articles of Incorporation decided pursuant to a resolution of Investors' Meeting.
(Executive Director) An amount determined at a meeting of the Board of Directors with a maximum of
800,000 yen per month.
(Supervisory Director) An amount determined at a meeting of the Board of Directors with a maximumof 500,000 yen per month.
As of June 30, 2024
Title

Name

Executive
Director

Brief Personal History

GenderHiroshi
Naito

Male

NaomasaNakagawa

Male

Harumi
Katagiri

FemaleSupervisory
Director

Apr. 1995 Joined Mori Building Co., Ltd.
Aug. 1999 Joined Mori Building Development Co., Ltd.
(now MORI TRUST CO., LTD.)
Nov. 2009 Section Manager, General Administration Department Legal Affairs, MORI TRUST
CO., LTD.
Dec. 2014 Section Manager, Public Relations Department, MORI TRUST CO., LTD.
Jul. 2016 General Manager, Public Relations Department Public Relations Group, MORI
TRUST CO., LTD.
Nov. 2017 Seconded to MORI TRUST Asset Management Co., Ltd. General Manager, Planningand Finance Department
Jun. 2018 Seconded to MORI TRUST Asset Management Co., Ltd. Director and General
Manager, Planning and Finance Department
Mar. 2019 Seconded to MORI TRUST Asset Management Co., Ltd. General Manager, Strategic
Management Department Sogo REIT Management Division, and General Manager,
Planning and Finance Department
Nov. 2022 Seconded to MORI TRUST Asset Management Co., Ltd. Director, and General
Manager, Strategic Management Department Sogo REIT Management Division, andGeneral Manager, Planning and Finance Department
Mar. 2023 President and Representative Director (in office)May 2023 Executive Director of MORI TRUST REIT, Inc. (in office)Oct. 1999 Passed a bar examination
Oct. 2001 Joined Mitsui, Yasuda, Wani & Maeda
Sep. 2004 Joined Orrick’s Tokyo office
Oct. 2008 Joined Orrick, Herrington & Sutcliffe LLP (San Francisco)Sep. 2009 Joined Hibiya Park Law Office
Apr. 2018 Auditor, coly, Inc.
Jan. 2019 Partner lawyer, Hibiya Park Offices (in office)(Practice Areas:General Corporate, Cross-border Transactions, Mergers andAcquisitions, Compliance, Corporate corruption, Crisis management, Intellectual
Property, Systems-related, Non-profit activities-related, Lawsuits and International
arbitration)
Jun. 2019 Supervisory Director, MORI TRUST REIT, Inc. (in office)Jan. 2024 Auditor, RK CONSULTING CO., LTD. (in office)Nov. 1993 Joined Asahi Audit Corporation. (currently, KPMG AZSA LLC)
Apr. 1998 Registered as a certified public accountant in Japan
Mar. 2000 Joined Century Audit Corporation (currently, Ernst & Young ShinNihon LLC)
Jul. 2009 Employee of Ernst & Young ShinNihon (currently, Ernst & Young ShinNihon LLC)
Jul. 2017 Established the Harumi Katagiri CPA office (in office)Mar. 2018 Outside Director, Tamron Co., Ltd. (in office)Jun. 2019 Supervisory Director, MORI TRUST REIT, Inc. (in office)Director, Japan Asia Investment Co., Ltd. (in office)Jun. 2024 Director Audit and Supervisory Committee Member, Kanagawa Chuo Kotsu Co.,Ltd.
(in office)Number ofinvestment
units

0

0

0

In addition to the above, she serves as a member of the Contract Review Committee of the
Ministry of Internal Affairs and Communications and a member of the Bid Monitoring Committeeof the Tokyo Metropolitan Government.

Title

Name

Directors' remuneration (Note)

Executive Director

Hiroshi Naito－

Naomasa Nakagawa¥1,800,000

Harumi Katagiri¥1,800,000

Supervisory Director(Note) Directors' remuneration for the fiscal period ended February 2024 (6 months).
Remuneration is paid entirely on a fixed pay basis. No remuneration is paid on a variable and incentive basis.

41

６. Governance Initiatives

Directors' Investment Unit Holding Policy
From the viewpoint of preventing insider trading, the "Corporate Relationship Information
Management Regulations" at MTR stipulate that directors of MTR must not buy or sell MTR’s
investment units, and none of the executive directors or supervisory directors hold MTR’s
investment units.

Status of Accounting Auditor
The status of the Accounting Auditor is as shown below.
Title

Name

Accounting Auditor

Ernst & Young ShinNihon LLC

Remuneration (note)
audit fees

¥13,000,000

non-audit fees

¥2,200,000(Note) Accounting Auditor's remuneration is for the fiscal period ended February 2024 (6 months).

Status of Unitholders
MTR's principal unitholders (the top ten entities with the highest holding ratios) as of the end of
February 2024 are as shown below.
Name
MORI TRUST Holdings, Inc.

Number of units held

Ownership
ratio

1,038,700 units

29.2%

Custody Bank of Japan, Ltd.(Trust accounts)

672,565 units

18.9%

The Master Trust Bank of Japan, Ltd. (trust account)389,461 units

10.9%

The Nomura Trust and Banking Co., Ltd. (investment trust)

135,960 units

3.8%

SSBTC CLIENT OMNIBUS ACCOUNT

47,191 units

1.3%

STATE STREET BANK WEST CLIENT - TREATY 505234

43,611 units

1.2%

LEGAL + GENERAL ASSURANCE PENSIONS MANAGEMENT LIMITED

37,064 units

1.0%

JP MORGAN CHASE BANK 385781

35,436 units

1.0%

JP MORGAN CHASE BANK 385771

34,570 units

1.0%

STATE STREET BANK AND TRUST COMPANY FOR DWS RREEF REAL ASSETS FUND

28,700 units

0.8%

2,463,258 units

69.2%

Total of top 10 investors

MTAM's Organizational Structure
MTR entrusts asset management to MTAM. MTAM's organizational structure is as shown below.

42

６. Governance Initiatives▮ Compliance Structure
Basic Compliance Policy and Structure
MTAM has set compliance with laws, regulations and other rules as one of its management priorities
and MTAM’s management is actively working to develop and strengthen the compliance structure andinternal control structure. To establish an appropriate operational structure, MTAM has appointed acompliance officer as the person responsible for compliance-related matters at MTAM to ensure thatinternal checks and balances on other departments function effectively. Furthermore, through theestablishment and operation of the Compliance Committee, MTAM has established a multi-tiered
structure for ensuring MTR’s compliance with laws, regulations and other rules.

（a）Board of Directors
The Board of Directors seeks to ensure compliance as the organization with ultimate responsibility
for the execution of business and, besides receiving reports on matters approved by the Compliance
Committee, also makes resolutions on important compliance-related matters at MTAM, including
formulation and amendment of the basic policy on compliance and compliance program, formulationof the risk management plan and internal audit plan, as well as appointment and dismissal ofCompliance Committee members and the Compliance Officer.

（b）Compliance Committee
The Compliance Committee consists of the President and Representative Director, directors(including non-executive directors), the Compliance Officer, and one or more persons qualified as
lawyers or certified public accountants or persons who are otherwise deemed to be familiar withcompliance (limited to those who have no relations in the asset management company, or thematters handled by the asset management company). The Compliance Committee is chaired by theCompliance Officer.
The Compliance Committee is responsible for execution of the duties set forth in the Compliance
Committee Rules in cooperation with the Board of Directors and Compliance Officer.

（c）Compliance Officer
As the person responsible for compliance at MTAM, the Compliance Officer works to establish aninternal compliance structure and to raise awareness of norms for compliance with laws, regulations
and other rules within the company. The Compliance Officer, therefore, constantly monitors whether
MTAM executes asset management business in accordance with laws, regulations and other rules,
and also monitors and supervises the status of compliance in the execution of day-to-day operations.
In light of the importance of the Compliance Officer’s responsibilities, MTAM elects as Compliance
Officer an individual who is sufficiently capable of examining and supervising business execution toachieve compliance with laws, regulations and norms.
MTAM has put in place a structure such that any act pertaining to MTAM’s business operations that
violates or is likely to violate laws and regulations discovered by any officer or employee is reported
immediately to the Compliance Officer.

43

６. Governance Initiatives

Appropriate Management of Conflicts of Interest

Proposing department

Review by the Compliance Officer

Resolution by the Compliance Committee

Resolution by Investment Committee

Resolution by the Board of Directors of MTAM

Approval by the Board of Director of MTR

The attendance and approval of outside committee
members are required for a resolution to be passed

Instructions to stop or alter transaction

To prevent MTAM from engaging in transactions with related parties sharing certain interests with
MTAM which may be harmful to the interests of MTR, MTAM has identified types of related party
transactions and set forth related party transactions standards and comprehensively judges whether
to conduct a transaction through deliberation by more than one body. MTAM elects outside specialists
as committee members to both the Compliance Committee and the Investment Committees that holdsuch deliberations.
If the acquisition of an asset or other transaction by an investment corporation which entrusts its
asset management to MTAM constitutes a related party transaction, approval is required from theCompliance Committee and the Investment Committee, both of which have outside members, as well
as from MTAM’s Board of Directors and MTR's Board of Directors. Details of this decision-making
process are as shown below.

Exclusion of Antisocial Forces
MTAM has formulated the Basic Policy to Prevent Damages Caused by Antisocial Forces in order to
exclude antisocial forces and groups that threaten public order or stability and obstruct the economic
activity of companies and individuals.
The Policy sets out that the organization as a whole will deal with unjust demands by antisocial forces,that MTAM will establish close and cooperative relationships with external specialist organizations
such as the competent police, the National Center for Removal of Criminal Organizations, and legal
practitioners, that it have no relations with antisocial forces including business relations, and that it
will refuse any unjust demands by antisocial forces.

Prohibition of Insider Trading
MTR and MTAM established respectively its Corporate Information Management Rules to prohibit
MTR's officers and MTAM's all its officers and employees (including temporary employees, contract
employees, employees on loan or dispatched from other companies, and officers) from engaging intransactions such as trading securities including MTR's investment units, based on corporate
information or other special information that they have obtained in the course of operations bytaking advantage of their titles and positions.

44

６. Governance Initiatives

Relations with politicians and governments
MTAM’s Basic Policy on Compliance stipulates that it shall maintain transparent and sound relations
with politicians and governments.
It has never made any political donations in the past.

Prevention of Bribery and Corruption
MTAM has the Rules of Employment and the Basic Policy on Compliance in place to ensure that all
managers and employees do not engage in any type of fraud or corruption, including the offering or
accepting of gifts, entertainment and/or other benefits beyond socially accepted limits, money
laundering, acts of bribery including the offering of economic benefits to public officers and acts of
pursuing their own interest by taking advantage of their positions, with strict disciplinary action
applying for any violation of such rules.
With respect to acts of fraud and corruption, there has been no material violation or any record of
paying penalties, surcharges or settlement money to date.
No employee has been subject to reprimand or dismissal due to acts in relation to bribery or
corruption.
In addition, we are fully committed to ensuring that all managers and staff members thoroughly
understand the content of the Rules of Employment and the Basic Policy on Compliance. Measures forthe prevention of acts of fraud and corruption are properly integrated into the company-wide risk
management program and management.
For outline of the company-wide risk management program, please refer to “Risk Management ” onpage 46 of this report.

Establishment of Whistleblowing System
MTAM has a whistleblowing system in place for all its officers and employees (including temporary
employees, contract employees, and employees on loan or dispatched from other companies,
employees not running in a year from whistleblowing and officers).
This system is used for whistleblowing to report acts involving organizational or individual violations oflaws and regulations, including any type of fraud or corruption such as the offering or accepting ofgifts, entertainment and/or other benefits beyond socially accepted limits, money laundering, acts ofbribery including the offering of economic benefits to public officers and acts of pursuing personal
interest by taking advantage of one's position.
A whistleblower can make a report anonymously. In addition, in accordance with the Whistleblower
Protection Act, it is prohibited to carry out dismissal, disciplinary measures, retaliation or any othertreatment that is disadvantageous to a whistleblower on account of such whistleblowing.

Provision of Regular Compliance Training

MTAM provides all its officers and employees (including temporary employees, contract employees,
employees on loan or dispatched from other companies, and officers) with training mainly aimed atraising compliance awareness on a regular basis.

Conduct of Audits of All Business
The Compliance Officer of the Asset Management Company is in charge of internal audits and, inprinciple, conducts regular internal audits of all operations of all departments (investment
management structure, financial management structure, legal compliance structure, compliance withethical standards, anti-corruption, etc.) at least once every six months. In addition, the Compliance
Officer may conduct extra audits at his/her discretion and may conduct special audits at adetermination of the President and Representative Director or an Internal Audit Manager.

45

６. Governance Initiatives▮ Risk Management
Basic Risk Management Policy and StructureWith risk management positioned as one of its management policies, MTAM is facilitating risk
management according to the Risk Management Regulation set forth for ensuring the continuity andstable growth of businesses and soundness of management.
MTAM has also established the following risk management system.

(a) Board of Directors
The Board of Directors makes decisions on the formulation and revision of plans for risk
management (Risk Management Plan) and receives regular reports from the Compliance Officer
on the progress of the plan.
(b) Compliance Officer
The Compliance Officer, as the Chief Risk Management Officer, establishes and maintains therisk management framework of MTAM and controls operations related to risk management.
(c) General Managers
The general managers as risk management managers establish and maintain a risk
management framework under their jurisdiction, and control and execute operations related torisk management under their jurisdiction.

Risk Management Process
In accordance with the "Risk Management Regulations," MTAM practices company-wide risk
management by conducting risk assessments and formulating a "Risk Management Plan" every fiscal
year, as well as by regular checking on the progress of the plan. The risk management process is asfollows:① Identify risk items in each department by risk category.
② Assessment of "frequency of occurrence (possibility of occurrence)" and "scale of damage (impact)"of each risk.
③ Based on the results of the above assessment, determine which risk items could be material risk
items.
④ Set management targets and formulate response measures for each determined material risk item.
⑤ Assessment of the implementation status of response measures, and report on the results of theassessment and corrective/improvement matters based on the assessment.

Education and training
Chief Risk Management Officer or risk management officers provide all managers and staff memberswith education and training to make sure that they understand and recognize risk management and theimportance thereof.

▮ Other Initiatives
Information Security
MTAM enacted the Information Management Rules with the aim of properly utilizing company informationand preventing information incidents including unauthorized access and the loss or leak of company
information.
The rules aim to ensure information management by providing for training and audits on the
management of confidential information, restriction of unauthorized access, prevention of information
leaks, maintenance of information systems and information system.
46

６. Governance Initiatives

Same Boat Investment by Sponsor GroupMTR aims to improve unitholder value by aligning sponsor interests with those of unitholders.

Percentage of investment units owned
by Mori Trust Group

29.2％ （as of February 29, 2024)
Customer-oriented Business Conduct
MTAM adopted the Principles for Customer-Oriented Business Conduct announced by the
Financial Services Agency on March 30, 2017 and set forth a Policy on Customer-Oriented
Business Conduct as set out below.
1. Formulation and Announcement of Policies regarding Customer-Oriented BusinessConduct
We have formulated and announced this Policy and we publish the status of the Policy’s
implementation and also revise this Policy as appropriate.
2. Pursuit of the Customers’ Best Interest
As a financial service provider, we maintain a high level of expertise and professional ethics,
conduct business with customers in a faithful and fair manner, and pursue customers’ bestinterests. MTAM also endeavors to ensure that such business conduct becomes firmly
established as its corporate culture.
3. Appropriate Management of Conflicts of Interest
To accurately understand and manage potential conflicts of interests in transactions, we haveestablished rules such as the Related Party Transaction Rules and Compliance Rules as voluntaryrules in addition to the provisions of relevant laws and regulations, and we have established apolicy for dealing with transactions involving conflicts of interest and an operating structure toensure high independence.
4. Clarification of Various Fees and Commissions
MTAM properly provides information to help customers understand details of various fees andcommissions paid to us by investment corporations which entrust their asset management to us,
including details of the kind of services provided in exchange for these fees and commissions.
5. Providing Important Information in an Easy-to-understand Manner
MTAM provides important information which might affect customers’ investment decisions in aneasy-to-understand manner through statutory disclosure, timely disclosure, voluntary disclosure
and other means.
6. Providing Suitable Service to Customers
We endeavor to understand customers’ needs and conduct asset management based on anawareness of these needs. We also provide easy-to-understand information that helps
customers understand the status of operations of investment corporations who entrust theirasset management to us.
7. Framework for Adequate Motivation of its Employees
To further promote customer-oriented business conduct, MTAM raises awareness of its
Corporate Philosophy and its Basic Policy on Compliance as well as of the importance of thispolicy among individual employees through compliance training, etc.

47