Daiwa Office Investment Corporation

Daiwa Securities Living Investment Corporation

Sustainability Report 2023
Asset Management Company
Daiwa Real Estate Asset Management Co. Ltd.

Reporting period
April 2022 – March 2023（Specific ESG initiatives and statistics include historical data）

About thisSustainability
ReportContents■Introduction
・Top Message........................................................................... 3・Overview of the REIT/ Asset Management Company ..........4
・Sustainability Policy/Sustainability Promotion System..... 5■Environmental Initiatives
・Climate Change Initiatives①................................................. 6
・Climate Change Initiatives②................................................. 7
・Climate Change Initiatives③................................................. 8
・Environmental Targets and Performance............................ 9・Implementing Eco-Friendly Initiatives via Real
Estate Investment................................................................. 10
・Collaboration with Stakeholders / Urban Development
Initiatives................................................................................ 11■Social Initiatives
・ Initiatives for Tenants and Local Communities................. 12
・ Initiatives for Human Rights and Promotion of DEI. ......... 13
・ Initiatives for Human Resource Development................... 14
・ Initiatives to Achieve Diverse Work Styles /Initiatives for Health and Comfort...................................... 15

Reporting organization
Daiwa Office Investment Corporation
Daiwa Securities Living Investment Corporation
Daiwa Real Estate Asset Management Co. Ltd.

IssuedJuly 2023(Frequency of updates ：published once a year)※English version published August 2023
Contact
Daiwa Real Estate Asset Management Co. Ltd.
Department：Sustainability Promotion Office
TEL：＋81-3-6215-9500（main number）

Disclaimer
This report contains forward-looking statements. These statements are based on
judgments made in accordance with information available at the time of preparationof each material, and do not guarantee of future performance.

■Governance Initiatives
・Corporate Governance Structure................................. 16
・Compliance Structure................................................... 17
・Risk Management Initiatives.........................................18■Sustainability Finance・Sustainability Finance.................................................. 19■Acquisition of External Assessments/Certifications
・External Assessments............... .....................................20
・External Certifications.................................................. 21■ESG Data
・ESG Data（Environmental Initiatives）.......... ........... 22
・ESG Data（Social Initiatives）..................................... 23
・ESG Data（Governance Initiatives①）....................... 24
・ESG Data（Governance Initiatives②）....................... 25
・ESG Data（Governance Initiatives③）....................... 26

Editorial Policy

This report is published to consolidate thesustainability-related information disclosed
by Daiwa Office Investment Corporation,
Daiwa Living Investment Corporation, andDaiwa Real Estate Asset Management Co. Ltd.
The purpose of this report is to provide
stakeholders with a deeper understanding of
the company's approach and initiatives withrespect to ESG issues.
The following icons are displayed in the upper
right corner of each page according to thecontent of each organization's report.
Daiwa Office Investment Corporation
(DOI)

DOI

Daiwa Real Estate Asset Management
Co. Ltd. (DR)DR

Daiwa Securities Living Investment
Corporation (DLI)DLI

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

Top Message

DOI

Daiwa Office Investment Corporation

Daiwa Securities Living Investment Corporation

Keiichi Sakai

Yoshio Urata

Executive Director

Executive Director

3

ESG Data

DLI

DR

Daiwa Real Estate Asset Management Co. Ltd.

President and Representative Director

Yoshiki Nishigaki

Daiwa Real Estate Asset Management Co., Ltd. (hereinafter referred to as the "Asset Manager") established the "Sustainability Promotion Committee" in June 2021 to discuss important policies, measures, andapproaches concerning sustainability, based on the recognition that focusing on ESG in asset management, such as environmental considerations, social contributions, and strengthening organizational
governance, will contribute to improving corporate value of the investment corporation in the medium to long term. In June 2021, The Asset Manager established the "Sustainability Promotion Office" as a
specialized department to promote the planning, formulation, and implementation of ESG and SDGs across the entire company in order to address various ESG-related issues. In March 2023, The Asset Manager
expanded the sustainability elements of the "Policy on ESG" and formulated a new "Sustainability Policy" to systematically promote sustainability initiatives while taking into account the diversifying needs ofstakeholders.

Daiwa Office Investment Corporation ("DOI") and Daiwa Living Investment Corporation ("DLI") continuously participate in the GRESB Real Estate Assessment and have obtained multiple environmental
certifications and assessments from external organizations, while working to reduce environmental impact through energy conservation, reduction of greenhouse gas emissions, and effective use of limited
resources such as water conservation. DOI and DLI are working to reduce environmental impact through energy conservation, reduction of greenhouse gas emissions, and effective use of limited resources suchas water conservation. In addition, DOI and DLI aim to realize a sustainable society by building good relationships, partnerships, and collaboration with all stakeholders (unitholders, tenants, local communities,
employees, etc.) related to the properties DOI and DLI own.

Each investment corporations used to issue sustainability reports individually, but starting from "Sustainability Report 2023", Sustainability-related information disclosed on the website, etc., by Daiwa Office
Investment Corporation, Daiwa Living Investment Corporation, and Daiwa Real Estate Asset Management Co. Ltd. has been centrally integrated and reorganized the approach to ESG and the content of its
initiatives. We hope that this report will deepen the understanding of investors and other stakeholders.

Top Message/
Summary

Sustainability Report 2023

Overview of the Investment Corporations

DOI

DLI

Daiwa Office Investment Corporation is a REIT specializing in office properties in the five central wards ofTokyo. The sponsor is Daiwa Securities Group Inc. and Daiwa Office Investment Corporation manages its
properties by maximizing the management resources of the Daiwa Securities Group, establishing a strict
governance system, and conducting highly transparent management with an emphasis on compliance.
With regard to the basic investment policy, the Investment Corporation will conduct investment
management based on the characteristics of office buildings, carefully selecting regions, sizes, etc.
We aim to maintain and improve distributions over the medium to long term through flexible managementthat responds to changes in real estate market conditions, securing stable cruising EPU in the future andsustainable growth of investment assets, and through replacement of properties to realize stable
management and improve quality through urban locations.

＜Type of assets under management＞

Sustainability
FinanceAcquisition of External
Assessments/Certifications

4

ESG Data

Overview of the Asset Management Company

DR

Daiwa Real Estate Asset Management Co., Ltd. is an asset management company established in October 2004 as
K.K. daVinci Select. Subsequently, the Company became a wholly owned subsidiary of Daiwa Securities Group
Inc. in 2009.In 2005, we began managing Daiwa Office Investment Corporation, a listed REIT specializing in officeproperties, and since then, we have expanded the scope of management to listed REITs and private REITs
targeting residential, healthcare, hotel, and logistics facilities, as well as private funds such as solar private corefunds, and as of March 31, 2023, the balance under management has grown to a scale exceeding approximately
1.2 trillion yen.

As a real estate asset management company in charge of the Daiwa Securities Group's real estate asset
management business, the Asset Manager will strive to revitalize the real estate and financial markets and foster
sound markets. In addition, the Asset Manager will build an ongoing relationship of trust with our clients byproviding quality products that can be invested and managed with confidence over the long term.

＜Transition of investment corporations under management＞

Office building

100.0%

Securities Code

2009

8976

2013

2014

2018

2020

OfficeOffice REIT
Start of operation: 2009 (*)
Number of properties ：58
Asset size: 462.5 billion yen

Usage Ratio

GovernanceInitiatives

SocialInitiatives

Environmental
Initiatives

Sustainability Policy/
Sustainability Promotion System(As of March 31, 2023)

Daiwa Office
Housing・Healthcare・Hotel
Investment
Logistics
Daiwa Residential Private Daiwa Securities Daiwa Hotel Private
Corporation (DOI) Investment Corporation
Living Investment Investment
Daiwa Securities(DRP)
Corporation (DLI) Corporation (DHP) Logistics Private
Investment
Corporation (DLP)＜Changes in balance under management＞（Unit：billion）
13,000Approx. 1.2
trillion yen

12,000In April 2020, Daiwa Living Investment Corporation merged with Nippon Healthcare Investment
Corporation (former NHI) and changed its name from Japan Rental Housing Investments Inc. to Daiwa
Living Investment Corporation. With the addition of health care facilities to its portfolio, Daiwa Living has
been managing rental housing and health care facilities with the aim of becoming a REIT thatcomprehensively provides comfortable living spaces based on the concept of "supporting the lives andlivelihoods of all people" in accordance with their life stages. Ltd., We aim to maximize profits for ourunitholders by leveraging in the support of our sponsor, Daiwa Securities Group Inc. and other Daiwa
Securities Group companies.

＜Type of assets under management＞

11,00010,000
9,000
8,000
7,000
6,000
5,000
4,000

Healthcare
Facilities

3,000

29.8%

Usage Ratio

Securities CodeRentalhousing

70.2%

2,000

8986

1,000

Residential REIT
Start of operation: 2014 (*)
Number of properties ： 248
Asset size: 363.2 billion yen

0(As of March 31, 2023)※Commencement of management by Daiwa Securities Group affiliated investment management company.

DOI（Former JRH）
DLI（旧JRH）

DRP

Former NHI
旧NHI

DHP

DLP

私募ファンドPrivate fund※The private funds AUM does not include certain cases, such as those of a structure where the Company is entrusted withasset management operations but the assets are managed and operated by a company other than the Company and theauthority over asset disposition does not lie with the Company.

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

Sustainability Policy/Sustainability Promotion System
The Daiwa Securities Group has set forth the Vision 2030 management vision, aiming to achieve the SDGs bycreating a mechanism to circulate funds, under the core concept of "From savings to SDGs."

Daiwa Real Estate Asset Management Co. Ltd. (the "Asset Manager"), as a member of this Group, will
incorporate ESG considerations into its asset management operations for alternative assets such as real estate.
It has formulated the Sustainability Policy and will promote the following initiatives to enhance the medium- tolong-term value of the investment corporations and funds for which it is entrusted with asset management.

Based on the Sustainability Policy set forth by the Asset Manager, the Investment Corporation will take actions
for sustainability in order to achieve a sustainable society.

Sustainability Policy<Initiatives for Environmental Management and Reduction of Environmental Impact>
1Promoting Resource and Energy Conservation
We will continue to promote the reduction of greenhouse gas emissions in order to mitigate climate change
and achieve our goal of a decarbonized society with net-zero emissions. In addition, we will strive to strengthen
the resilience of managed properties against natural disasters.
2.Contributing to a Recycling-Oriented Society
We will work to reduce, reuse and recycle water, waste and other elements.

3.Considering Biodiversity and Working to Conserve Ecosystems
We will strive to manage our business in a way that is mindful of environmental protection, manage tree
planting that is considerate of harmony with the surrounding environment and practice green procurement to
reduce the environmental impact of society as a whole, including our entire supply chain.

<Initiatives for Social Issues>
4.Respecting Human Rights
We will further strengthen our human rights education and awareness efforts to further enhance our corporate
culture, which is based on respect for human rights.
5.Cultivating Human Resources and Creating Rewarding Workplaces
We focus on human resource development, which is the source of our competitiveness, and are enhancing ourtraining programs. In particular, we will strengthen support for professional talent, including assistanceprograms for acquiring qualifications.

6.Diversity, Equity and Inclusion
Through a high level of work-life balance facilitating success for diverse human resources, we will pursue
harmony between our employees' professional and private lives, and aim to enhance workplace environments
so that both men and women can enjoy diverse work styles, while taking into consideration the health andcomfort of executives and employees.

7.Coexistence and Collaboration Throughout the Supply Chain
By building partnerships with our suppliers and business partners, we aim to deepen their understanding of ourinitiatives for the environment and society, and to target the creation of a sustainable society throughout our
supply chain.

<Initiatives for Governance>
8.Establishing a Highly Transparent and Objective Corporate Governance Structure
We will maintain strict compliance with laws, regulations and internal rules, as well as ensure rigorous
appropriate management of conflicts of interest and enhance our compliance system to increase the value ofthe investment corporations and funds.
9.Fair, Timely and Appropriate Disclosure of Material Information
We are committed to disclosing information in a fair, timely and appropriate manner to promote
understanding of our company among all stakeholders, including investors, business partners and society atlarge, and to earn an appropriate assessment and level of trust from these.
We will also utilize external evaluations in the interest of transparency and comparability.

GovernanceInitiatives

SocialInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

5

ESG Data

DR

Policy/Sustainability Promotion System

Based on its "Sustainability Policy," the Asset Manager has formulated the "Regulations for Sustainability
Promotion System" and established the "Sustainability Promotion Committee" for the purpose of continuousand systematic implementation of ESG-related initiatives. The Sustainability Promotion Office, established inJune 2021, systematically promotes planning, formulation, and implementation of ESG and SDGs, and theCommittee deliberates on the final target KPIs and specific initiatives, etc., and implements each measure.
（Sustainability Promotion Committee)
・President and Representative Director (Chief Executive Officer for Sustainability Promotion)
・Executive Managing Director
・General Managers of DOI Investment Management Dept., DLI Investment Management Dept., DRP
Investment Management Dept., DHP Investment Management Dept., DLP Investment Management Dept.,
and Private Fund Management Dept. (Chief Sustainability Officers)
・Head of Sustainable Promotion Office・Compliance Officer
・Others who are appointed by the Chief Executive Officer（Contents of deliberation/reports, frequency, consideration process）
The Sustainability Promotion Committee is held regularly (once a month, in principle) in order to realize thepolicy and targets for sustainability. The committee deliberates matters such as management policies onsustainability, target setting, and their revision and abolition, and reports on the progress of the targets, etc.

Establishment of Sustainability Promotion Policy

To enhance the effectiveness of our sustainability activities, we have established (1) Energy Conservation
Policy, (2) Greenhouse Gas Emissions Reduction Policy, (3) Water Saving Policy, and (4) Sustainable
Procurement Policy, Climate Change and Resilience Policy, EMS Operation Manual, and a cooperative
framework with each of our stakeholders.

Sustainability Education and Awareness Activities

Sustainability education and awareness-raising activities are conducted for all officers and employees of theAsset Management Company (including temporary employees). Sustainability training is conducted byexternal lecturers approximately once a year for all officers and employees of the Asset Management
Company (including temporary employees).
Year

FY2021
FY2022Training
Attendance rate

Training ThemeTCFD -Climate Change Response and Disclosure

Overview of ESG and trends in ESG in the real estate
investment industry
Trends in DEI (Diversity, Equity & Inclusion)

100.0%

100.0%＜Reference: Daiwa Securities Group Management Vision “Vision 2030”＞
Daiwa Securities Group has formulated “Vision 2030" as its vision for the year 2030. The Daiwa Securities Grouphas established the following materialities individually and formulated a strategy for the first three years toachieve them as the new medium-term management plan "Passion for the Best" 2023.
The plan is entitled "Passion for the Best" 2023, which sets out strategies for the first three years to achieve thefollowing materiel.

「2030Vision」
Materiality

100 years of life

Innovation

Green & Social

Diversity &Inclusion

Foundation of
Sustainable
management

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

Climate Change Initiatives①
Our Approach to Climate Change

The world has been accelerating the transition to a carbon-neutral society. This trend is found in the global
long-term goal set in the Paris Agreement, an international framework since 2020 to address global warming.
The goal in the agreement is to hold the increase in the global average temperature to well below 2°C above
pre-industrial levels and pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels,
and Japan has declared its intention to achieve carbon neutrality by 2050.
The Investment Corporation and the Asset Manager view climate change as an important issue that changes
the natural environment and social structures dramatically and has a significant impact on real estate
management. Contribution to the achievement of a carbon-neutral society is considered as a social mission.
In accordance with the TCFD recommendations, we will identify and analyze risks and opportunities related
to climate change and proceed with step-by-step disclosure of information related to climate change. We
will continuously work to reduce the environmental impact of business activities as we understand social
needs and expectations for us through active dialogue with external stakeholders.

Support for TCFD Recommendations

The Task Force on Climate-related Financial Disclosures (TCFD) is an international initiative established by
the Financial Stability Board (FSB), at the request of the G20. The purpose of the TCFD is to discuss
disclosure of climate-related financial information and the responses by financial institutions.

To clarify the policy and system for addressing climate-related issues and expand the disclosure of
information about relevant initiatives, the Asset Manager established the Climate Change and Resilience
Policy and announced its support for the TCFD recommendations in December 2021. In January 2022, theAsset Manager joined the TCFD Consortium, a group of domestic companies that support the TCFD
recommendations.

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

6

ESG Data

DOI

DLI

DR

(Analysis Procedure)① In accordance with the TCFD framework, the Asset Manager discussed climate-related risks and opportunities
and identified factors that may have a significant impact on the Investment Corporation’s business domain.
②Concerning the risks and opportunities identified in ①, the Asset Manager summarized and grasped what theworld would look like under the 1.5°C/2°C and 4°C scenarios, based on the parameters (forecasts) of the
adopted scenarios.
③Based on the forecasts in ②, the Asset Manager conducted a qualitative analysis for the Investment
Corporation, calculated financial impacts in the scenario analysis, and worked out countermeasures.
1.5°C/2°C scenario

Transition Risks
Physical Risks

IEA World Energy
Outlook2020 NZE2050

EA World Energy Outlook
2020 STEPS(Expected Future in Each Scenario)

4°C scenario

IEA World Energy
Outlook2020 STEPSIPCC Fifth Assessment
Report RCP8.5［4°C Scenario］
The 4°C scenario forecasts a future where greenhouse gas emissions are on an increasing trend due toinsufficient climate change mitigation, without new regulations, taxation, or other measures to achievea carbon-neutral society. The scenario involves high relative physical risks from climate disasters and lowtransition risks.
Government

Tenants

Investors

Stricter legal
Increased needs forHigher importance ofregulations related to measures against storm physical risk assessment
resilienceand flood damage,in making investment
heatstroke, etc.
decisions

Financial
Institutions

Increased needs forphysical risk
assessment in making
lending decisions

Climate/Weather

Intensifying storm
and flood damage
and increased
natural disasters due
to risingtemperatures, etc.

＜1. Governance＞

The Asset Manager has established the Climate Change and Resilience Policy, the policy for responding torisks and opportunities related to climate change and working to make business and strategy resilient toclimate-related issues.

In accordance with the policy, Chief Climate-Related Issues Officers (general managers of departments
engaged in sustainability promotion) make regular reports to the Chief Executive Officer for Climate-Related
Issues (President and Representative Director) at Sustainability Promotion Committee meetings. The
reports cover matters related to responses to climate change, including identification and evaluation of
impacts of climate change, management of risks and opportunities, progress of initiatives for adaptationand mitigation, and indicator and target setting. The Sustainability Promotion Committee deliberates anddiscusses issues related to climate change, after which the Chief Executive Officer for Climate-Related Issues
makes final decisions. Under this system, climate-related issues are supervised by the President andRepresentative Director.

＜2. Strategy＞

To factor climate-related risks and opportunities into the Investment Corporation’s real estate
management business, the Asset Manager conducted a scenario analysis of the Investment Corporation’s
portfolio. The Asset Manager referred to climate outlooks published by international organizations andother entities, in order to identify risks and opportunities of climate change brought to the Investment
Corporation and assess financial impacts on the Investment Corporation's business. Using a 1.5°C/2°C
scenario and a 4°C scenario, a qualitative analysis was conducted as described below.
(Target of Analysis and Prerequisites)
Target: All properties owned by the Investment Corporation
Scope: Overall real estate investment and management business
Target period: From 2022 to 2050, with short-term, medium-term, and long-term timeframes(Short term: 2022–2025, Medium term: 2026–2030, Long term: 2031–2050)［1.5°C/2°C Scenario］
The 1.5°C/2°C scenario forecasts a future where greenhouse gas emissions are on a decreasing trend, with theadvancement of social policy, emission regulations, technology investment, and other measures to achieve acarbon-neutral society. The scenario involves low relative physical risks from climate disasters and hightransition risks.
Government

Tenants

Investors

Stricter regulations
against GHG emissions
due to an introductionof carbon tax

Increased needs forenvironmental
performance

Increased needs for theassessment ofcompliance withenvironmental
regulations andenvironmental
certifications in making
investment decisions

Financial
Institutions

Increased needs for theassessment ofcompliance withenvironmental
regulations andenvironmental
certifications in making
lending decisions

Climate/Weather

A certain degree ofadvancement ofchronic climatechange, such asincreased storm andflood damage

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Climate Change Initiatives②(Financial Impacts in the Scenario Analysis）

For each scenario, the Asset Manager classified the financial impacts of identified risks andopportunities into short-term, medium-term and long-term impacts and examined relative scales ofimpacts on the Investment Corporation. Shown below are medium-term and long-term risks fromclimate change that have a certain degree of financial impacts.

1. Transition risks: Policy and legal risks, technology risk, market risk, and reputation risk
2. Acute physical risks: Event-driven climate risks, including typhoons and floods
3. Chronic physical risks: Climate risks caused by long-term shifts in climate patterns, including
sustained higher temperatures and sea level rise

Financial Impacts in the Scenario Analysis（DOI）
Risk and Opportunity Factors in RealClassification
Estate Management

Policy and Legal

Stricter regulations against GHG
emissions due to an introduction ofcarbon tax

Technology
MarketTransition Risks and Opportunities

Reputation
Acute
Chronic

Physical Risks

Increased loss due to intensifying
storm and flood damage

Increased damage from rise inaverage temperature/sea level- Decreased investment unit prices/Lower ESG ratings- Decreased profitability of properties with low
environmental performance/resilience- Increased repair costs and insurance premiums- Decreased rent income due to lower occupancy rates- Loss of business opportunities/Increased business
continuity risks- Increased renovation costs to protect portfolio
properties from water intrusion, damage, destruction,etc.

Acquisition of External
Assessments/Certifications

7

ESG Data

DOI<3. Risk Management>

DLI

DR

●Chief Climate-Related Issues Officers summarize climate-related risks and opportunities and report the progress to the
Sustainability Promotion Committee, in principle, once a year.
●The Sustainability Promotion Committee continuously identifies, assesses, and manages climate change risks andopportunities that are important to the business and financial plans and affect the asset management operations of theInvestment Corporation. Based on the above reports, the committee prioritizes issues of strategic importance to the business.
●The Chief Executive Officer for Climate-Related Issues instructs to factor important climate-related risks with high priority,
which have been deliberated by the Sustainability Promotion Committee, into the existing company-wide risk management
program. The risk identification, assessment, and management processes are thus integrated.

- Increased renovation costs due to raised energy-saving
Stricter energy-saving standards,
standards
obligation to report emissions- Increased business expenses related to emissions
reporting- Increased rent income from portfolio properties with
Enhanced competitiveness of properties high environmental performancethat comply with legal regulations- Decreased utility bills thanks to improved energy
efficiency- Increased renovation costs due to the introduction ofAdvancement and spread of energynew technologies
saving and renewable energy- Decreased utility bills thanks to better energy-saving
technologies
performance- Fluctuations in portfolio properties’ asset value
depending on environmental certification acquisition
rates
Fluctuations in properties’ asset value- Fluctuations in rent income depending on thedepending on environmental
proportion of portfolio properties with highperformanceenvironmental performance- Decreased utility bills thanks to better energy-saving
performance-Fluctuations in reputation from ESG-conscious
investors and lenders
Changes in the stances of- Fluctuations in ESG-conscious tenants’ demand forinvestors/lenders/tenants onmoving in and out
investment and lending- Better/Worse terms and conditions in financing fromfinancial institutions, etc.
Decline in reputation from investors
and customers

Sustainability
Finance

The Investment Corporation’s Climate Change and Resilience Policy sets out processes to identify, assess, and manage theimpacts of climate change risks and opportunities on the corporation’s management activities, strategies, financial plans, etc.

Potential Financial Impacts- Increased tax burden due to the introduction ofcarbon tax, depending on the volume of GHG
emissions from properties

GovernanceInitiatives

SocialInitiatives

Environmental
Initiatives

Category

4°C

Financial Impacts
1.5°C/2°C

Mid Term Long Term Mid Term Long Term

Risk

Small

Small

Medium

Large

Risk

Small

Small

Large

Large

Opportunity

Small

Small

MediumMedium

Risk

Small

Small

Large

Large

Opportunity

Small

Small

MediumMedium

Risk

Small

Small

Large

Large

Opportunity

Small

Small

MediumMediumOpportunity

Small

Small

MediumMedium

Risk

Small

Small

Large

Large

Risk

Small

Small

Medium

Large

Risk

Small

Medium

Small

Small

Risk

Small

Small

Small

Small

Countermeasures- Introduction of energy management systems and renewableenergy- Planned reduction of energy consumption/GHG emissions at
portfolio properties- Improvement in GHG emissions through strategic
replacement/renovation of properties- Increase in environmental certification acquisition rates- Introduction of cutting-edge technologies- Planned renovation works- Promotion of transition to power derived from renewableenergy- Increase in environmental certification acquisition rates- Promotion of transition to power derived from renewableenergy- Sufficient information disclosure about portfolio
properties’ environmental performance- Appropriate disclosure of ESG-related information,
including that on climate change- Higher ratings in ESG assessments by external institution- Reduction of financing costs through the use ofsustainability finance- Appropriate disclosure of ESG-related information,
including that on climate change- Stronger stakeholder engagement in the ESG area
- Continuous improvement of environmental performance/Continuous acquisition of environmental certifications- Risk comprehension using hazard maps, etc.
- Portfolio of highly resilient properties- Upgrading of facilities to install high-efficiency air
conditioning systems, introduction of energy management
systems- Implement energy saving initiatives in corporation withtenants, including green leases- Enhancement of BCP measures- Promotion of greening at portfolio properties

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

GovernanceInitiatives

SocialInitiatives

Environmental
Initiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

Climate Change Initiatives③

DOI

Financial Impacts in the Scenario Analysis(DLI)
Risk and Opportunity Factors in RealCficalassition
Estate Management

Policy and Legal

Stricter regulations against GHG
emissions due to an introduction ofcarbon tax
Stricter energy-saving standards,
obligation to report emissions

Technology
MarketTransition Risks and Opportunities

Changes in the stances ofinvestors/lenders/tenants on
investment and lending
Reputation
Acute

Increased loss due to intensifying
storm and flood damage

Chronic

Physical Risks

Decline in reputation from investors
and customers

Increased damage from rise in averagetemperature/sea level

Financial Impacts
1.5°C/2°C

Potential Financial Impacts

Category- Increased tax burden due to the introduction ofcarbon tax, depending on the volume of GHG emissions
from properties

Risk

Small

Small

MediumMedium

Risk

Small

Small

MediumMediumOpportunity

Small

Small

Small

Medium

Risk

Small

Small

MediumMedium- Increased renovation costs due to raised energy-saving
standards- Increased business expenses related to emissions
reporting- Increased rent income from portfolio properties with
Enhanced competitiveness of properties high environmental performancethat comply with legal regulations- Decreased utility bills thanks to improved energy
efficiency- Increased renovation costs due to the introduction ofAdvancement and spread of energynew technologies
saving and renewable energy- Decreased utility bills thanks to better energy-saving
technologies
performance
Fluctuations in properties’ asset value
depending on environmental
performance

4°C

Small

Small

MediumMedium- Fluctuations in portfolio properties’ asset value
depending on environmental certification acquisition
rates- Fluctuations in rent income depending on the
proportion of portfolio properties with highenvironmental performance- Decreased utility bills thanks to better energy-saving
performance-Fluctuations in reputation from ESG conscious
investors and lenders- Fluctuations in ESG conscious tenants’ demand formoving in and out- Better/Worse terms and conditions in financing fromfinancial institutions, etc.

Risk

Small

Small

MediumMediumOpportunity

Small
Small

Small

Small

Small

MediumMediumOpportunity

Small

Small

Small

Medium- Decreased investment unit prices/Lower ESG ratings- Decreased profitability of properties with low
environmental performance/resilience

Risk

Small

Small

MediumMediumRisk

MediumMedium

Small

Small

Risk

Small

Small

Small

Small

- Increased repair costs and insurance premiums- Decreased rent income due to lower occupancy rates- Loss of business opportunities/Increased business
continuity risks- Increased renovation costs to protect portfolio
properties from water intrusion, damage, destruction,
etc.

Risk

＜4. Indicators and Targets＞

MediumDLICountermeasures

Mid Term Long Term Mid Term Long Term

Opportunity

8

ESG Data- Introduction of energy management systems and renewableenergy- Planned reduction of energy consumption/GHG emissions at
portfolio properties- Improvement in GHG emissions through strategic
replacement/renovation of properties- Increase in environmental certification acquisition rates- Introduction of cutting-edge technologies- Planned renovation works- Promotion of transition to power derived from renewableenergy- Increase in environmental certification acquisition rates- Promotion of transition to power derived from renewableenergy- Sufficient information disclosure about portfolio properties’environmental performance- Appropriate disclosure of ESG related information,
including that on climate change- Higher ratings in ESG assessments by external institution- Reduction of financing costs through the use ofsustainability finance- Appropriate disclosure of ESG related information,
including that on climate change- Stronger stakeholder engagement in the ESG area
- Continuous improvement of environmental performance/Continuous acquisition of environmental certifications- Risk comprehension using hazard maps, etc.
- Portfolio of highly resilient properties- Upgrading of facilities to install high-efficiency air
conditioning systems, introduction of energy management
systems- Implement energy saving initiatives in corporation withtenants, including green leases- Enhancement of BCP measures- Promotion of greening at portfolio properties

Each Investment Corporations sees the transition to a carbon-neutral society as an opportunity. The following target KPIs(Key Performance Indicators)have been established as key monitoring indicators in the process ofmanaging climate change risks and opportunities.

（DOI）

Reduction of
CO2 emissions

KPI

Mid-term target (FY2030) :Reduction of 46% in CO2 emissions on an intensity basis across the portfolio by FY2030 (compared with FY2013)
Long-term target (FY2050) :Achieved carbon neutrality in CO2 emissions on an intensity basis across the portfolio by FY 2050.

（DLI）

KPI

Mid-term target
Percentage ofenvironmental
Achieve an environmental certification ratio of at least 20.0% for the entire
certifications acquired
portfolioDRSustainability Report 2023

Top Message/
Summary

Environmental Targets and Performance
Item

Energy

CO2

Water

Waste

Unit
Consumption (MWh)【base year】
104,219

Consumption

intensity (MWh/m²)
Emission (t-CO2)

Emission intensity (tCO2/m²)

Consumption (m³)
Consumption

CO2

Water

Healthcare
Item

0.071

-20.22%-22.49%396,297

290,167

284,367

296,251

0.787

0.575

0.580

0.610

EnergyCO2

Water

Emission (t-CO2)

Emission (t-CO2)

Emission intensity (tCO2/m²)

Consumption (m³)
Consumption

intensity (m³/m²)

3,478

2,502

2,092

1,862

1,865

58.20

55.21

53.63

8,312

FY20218,382

FY2022

8,687

－

－

Rate of change-27.78%

0.109

0.109

-22.70%

0.063

0.050

0.044

0.045

-28.57%-11.69%

3,768

3,387

3,611

194,337

1.780

1.725

1.678

1.572

-32.18%-24.58%Actual reduction
FY2022

48,780Rate of change

4.39%

16,2380.232

17,372-1.69%

0.082

462,4130.081

487,258-1.22%

2.33

2.26-3.00%

0.236

－

0.110

205,445

46,728-25.25%0.141

201,101

FY2021-22.74%

Actual reduction
FY20209

ESG Data

DLI

EnergyCO2

Itemconsumption
intensity

Water

short-term target
Average 1%

reduction per year－

Middle・Long-term target

Reduce by 5% over the 5-year base year

46% reduction by FY2030 (compared to FY 2013)
Achieve carbon neutrality by FY2050

maintainance of

maintainance of the status quo

the status quo(DLI)
Rental housing / Healthcare
Energy
CO2

Water

Item

consumption
intensity

short-term target
Average 1%

reduction per year－

maintainance ofMiddle・Long-term target

8% reduction by FY2030 (compared to FY 2022)

20% reduction by FY2030 (compared to FY 2022)

the status quo

maintainance of the status quo※ In July 2023, DLI set the above new reduction targets (energy consumption, CO2 emissions, and water consumption).

257,672

intensity (m³/m²)

Consumption

3,373

5,324

Emission intensity (t-intensity (MWh/m²)

3,594

12,029intensity (MWh/m²)

Consumption (MWh)4,388

FY2017

Consumption-16.43%0.076【base year】

Consumption (m³)

0.173

0.076

57.02

CO2/m²)0.178-19.49%0.089

waste (t)

Unit

0.181

83,902Rate of change

34,589Amount of recycled

Consumption

87,245

FY202237,063(DLI)
Rental housing

EnergyFY2021

38,250Consumption (t)Consumption (MWh)(DOI)

44,771intensity (m³/m²)

Unit

91,2370.207

Recycling rate (%)

Item

FY2020Acquisition of External
Assessments/Certifications

Reduction target

Actual reduction

FY2019Sustainability
Finance

DOI

Environmental Performance Results(DOI)

GovernanceInitiatives

SocialInitiatives

Environmental
Initiatives

Sustainability Policy/
Sustainability Promotion System

6.98%

5.37%

※ DOI sets the base year as FY 2019 and DLI sets the base year for rental housing as FY 2017. For aggregation of each environmental
performance data, please refer to each Investment Corporation's website for details on the methodology.
※ DOI and DLI have no history of using renewable energy

Third-party review（ verification ） of the environmental performance data

SOMPO Risk Management, a third-party organization, conducted third-party evaluation (verification) of
DOI/DLI environmental performance data (energy consumption, GHG emissions (Scope 1 and 2), water
consumption, and waste output) of FY 2021 and FY 2022 for the entire portfolio. To ensure the reliability of
the reported figures.

Construction of Environmental Management System

In order to pursue energy-saving, CO2 emissions
Implementation
reduction, and efficient use of water resources, each
Act
And
Improvement
Investment Corporations has established anenvironmental management system. Focusing on energy
Of Measuresconsumption, CO2 emissions, and water usage, it setstargets, tracks performance, manages budgets, andexecutes countermeasures (PDCA cycle), contributing to
the realization of a sustainable society through the
Check
reduction of its environmental footprint.
Analysis

Study for Eco Action 21 certification （DOI）

of Results

Plan Setting of Goals

Do

Measuring andunderstandingof Performance

DOI is currently studying the possibility of acquiring Eco Action 21 certification in FY2023. In addition to ourinternal environmental management system, we are planning to continuously promote the PDCA cycle forenvironmental management while meeting the requirements of Eco Action 21, and are aiming to ensuretransparency of information and revitalize the organization in environmental management through the
publication of environmental management reports.

Eco Action 21

Eco Action 21 is a system in which a third-party organization certifies and registers businesses thatappropriately implement environmental initiatives, establish, operate, and maintain a system forenvironmental management, and conduct environmental communication based on the "Eco Action 21
Guidelines" established by the Ministry of the Environment.

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

Implementing Eco-Friendly Initiatives via Real Estate Investment
Introduction and Upgrading of LED Lighting/Introduction of High-Efficiency Heat Source
Equipment

Each Investment corporation is progressively installing LED lighting (LED lighting and lighting equipmentwith human sensors) in the private and common areas of the properties they own. In addition, installinghigh-efficiency heat source equipment with excellent energy efficiency and refurbishing air-conditioning
equipment with high energy-saving performance at the time of renewal of heat source equipment, airconditioning equipment, etc.

Upgrading of air-conditioning
equipment（Daiwa Ginza）

Introduction and renovationof LED lighting（TK Flats Shibuya）

Introduction and Upgrading of Water-Efficient Equipment

Each Investment corporation is improving water conservation through measures such as upgrading tosanitary equipment with excellent water-saving performance and using rainwater and reclaimed water for
general service water in buildings.

Construction work for toilets(Daiwa Sasazuka)

DLI

DOI has installed solar-powered street lights on the site of Daiwa River Gate, taking advantage of its location
alongside the Sumida River, where the wind blows strongly and sufficient sunlight can be secured. DLI has
installed solar power generation equipment on the rooftops of its healthcare facilities and is working to cover
the electricity used at its properties through the use of renewable energy.

Use of IoT Technology

Installation of Solar-Wind
Streetlights(Daiwa River Gate)

Installation of solar panels(Mumin Omiya-kita)

DOI has introduced "Whiz," a sterilized cleaning robot, to its properties for cleaning work, and is working to
reduce the manpower shortage of cleaning staff and to reduce power consumption by improving work
efficiency. DLI has introduced "IoT devices" in some of its rental apartments as part of its leasing strategy toenable tenants to live comfortably and reduce wasteful power consumption by remotely/voice-controlling
lighting, furniture, etc. via smartphones.

and Upgrading to Water-EfficientEquipment（Joy Oyamadai）

Each Investment corporation implements rooftop greening/wall greening in the properties they own. The
rooftop garden is designed to preserve the diversity of vegetation by using many plants that are native tothe area and by implementing a planting plan that takes the ecological network into consideration. In Gran
Casa Ryokuchi-koen, which is owned by DLI, a self-managed park has been established, and the planting
management aiming to improve the quality of biodiversity has been evaluated. The park has received JHEP
certification (rank A) in recognition of its self-managed park and planting management that aims to
improve the quality of biodiversity.

JHEP certification

DOI

Use of Natural Energy

Promoting Greening of Walls and Rooftops/Conserving Biodiversity

Installation of rooftop
garden(Daiwa Azabu Terrace)

10

ESG Data

Greening of premises andpromotion of biodiversity(Gran Casa Ryokuchi-koen)

JHEP certification is the only certification system in Japan that enables objective
and quantitative evaluation, certification, and visualization of contributions to biodiversity
conservation, and is a voluntary system developed and operated by the Japan Ecosystem
Society.

Use of Digital Signage

Introduction of Whiz
(Shinjuku Maynds Tower)

Introduction of IoT devices(Gran Casa Nihonbashi Hamacho)

Each Investment corporation has installed digital signage in common areas to educate tenants andresidents about energy reduction at the properties they own, and is using the information to raiseawareness about energy consumption reduction, emergency evacuation sites, etc.

Promote installation of delivery boxes in rental housing(DLI)

DLI has installed delivery boxes and introduced a left-behind delivery service in some of the rental housing
units it owns. DLI aims to maintain and increase the installation ratio, as this will not only improve
convenience for residents, but also help solve problems such as reducing the re-delivery rate by delivery
companies and reducing CO2 emissions. As of the end of March 2023, the installation ratio was approximately
86% (excluding 13 properties such as single-building rental properties and condominium-owned properties
from the target properties).

Use of Digital Signage(Daiwa Ginza)

Installation of delivery
boxes(Gran Casa Omorikaigan)

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

GovernanceInitiatives

SocialInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

Collaboration with Stakeholders / Urban Development Initiatives
Supply Chain Management

Each Investment corporation has formulated a "Sustainable Procurement Policy" to promote
environmental and social initiatives in the supply chain. In addition to facility operation and management,
lease operation and management, and leasing, we also take into consideration the status of sustainability
initiatives and other factors. We are working to resolve environmental preservation and social issues
through cooperation with various partners.

Promoting Green Leasing(DOI)
As of the end of November 2022, DOI has concluded green lease contracts for 7.9%of its entire portfolio (based on total floor area). Shinjuku Maynds Tower is working
with tenants to promote the installation of LED lighting fixtures and energy（based on total floor area）
reduction and energy reduction in Shinjuku Maynds Tower.

7.9%

(DLI)
As of March 31, 2023, DLI had green lease agreements in 41.3% of its entire
portfolio (based on total floor area). In its rental housing, DLI has addedsustainability clauses to lease agreements for new contracts since FY2017, and is
working with tenants to reduce electricity, gas, and water consumption andpromote recycling.

41.3%（based on total floor area）

Distribution of Sustainability Guides

Each Investment corporation has been distributing and posting the Sustainability Guide to tenants andresidents of the properties they own since 2023. The guide includes the Asset Manager's sustainability policy
and examples of specific sustainability initiatives that can be easily put into practice, and is used to raiseawareness of the need to combat global warming and achieve the SDGs.

Conduct tenant satisfaction surveys

Each Investment corporation conducts a tenant satisfaction survey for tenants of owned properties (DOI: for allproperties owned, DLI: for operators of healthcare facilities only) on a regular basis (in principle, at least once every
three years).
By sharing the results of this survey (requests, issues, from tenants.) with the property management company, etc.
and utilizing them to improve the operation and management of the property, we aim to improve tenant satisfaction.

Installation of small
containers in women's
toilets(E SPACE TOWER)

Implementation of air
conditioner replacement（ Good Time Living
Amagasaki Ekimae ）

DOI

DLI

Investment in urban redevelopment/development projects(DOI)

DOI has been engaged in the urban development business of acquiring development sites and developing
office buildings, with "Nihonbashi Bakurocho 1-chome Development Project" (completed in November2022) and "Kandasudacho 2-chome Development Project" (scheduled for completion in June 2024) as
examples. Both of these projects are contributing to the strengthening of disaster prevention functions in
the area by replacing multiple aging buildings with a single building.
Nihonbashi Bakurocho 1-chome Development Project is contributing to the revitalization of the area by
creating a mixed-use building with not only office space but also retail space on the lower floor. In
Kandasudacho 2-chome Development Project, we are working on urban development and urban
redevelopment while taking the environment into consideration, such as by creating open green spaces.

The Nihonbashi Bakurocho 1-chome
Development Project（ Current Daiwa Nihonbashi Bakurocho Building ）Kandasudacho 2-chome Development Project（ Daiwa Akihabara (planned) ）Investment in mixed/multi-use property

Each Investment corporation owns mixed-use properties (DOI: Shinjuku Maynds Tower, E SPACE Tower, etc.;
DLI: AIP Kachidoki Ekimae Building, etc.). They include commercial facilities such as convenience stores andrestaurants, and medical facilities such as clinics and nursing homes, etc. Through investment in mixed-use
properties, they contribute to improving living convenience for office workers and neighborhood residents
and revitalizing local communities.

Environmental risk assessment at the time of property acquisition

In acquiring real estate, each Investment corporation obtains real estate appraisal reports andengineering reports, in addition to on-site inspections and disclosed materials from the seller, andconducts surveys related to hazardous substance content in the building, soil contamination status, etc.

Commitments for undeveloped sites

Considering the impact of development activities on the target site and the surrounding naturalenvironment and ecosystems, DOI aims to make buildings in each development project capable ofobtaining environmental certification in principle.
The Nihonbashi Bakurocho 1-chome Development Project received a 3-star BELS certification in
November 2022, and the Kanda-Sudacho 2-chome Development Project has adopted a design withexcellent energy-saving performance, with primary energy consumption less than 60% of that of aconventional building, which reduces the burden on tenants' utility costs. The Kanda-Sudacho 2-chome
Development Project is aiming to become the first building in DOI's portfolio to acquire ZEB Oriented
certification.

ZEB

Renovated Entrance Hall
（Daiwa Tsukishima）

11

ESG Data

ZEB (Net Zero Energy Building) is a building that aims to reduce energy
consumption in the building to zero while achieving a comfortableindoor environment. The BELS rating system is based on four levels: ZEB,
Nearly ZEB, ZEB Ready, and ZEB Oriented.

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

GovernanceInitiatives

SocialInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

Initiatives for Tenants and Local Communities

Initiatives for Local Communities

Each Investment corporation makes the following efforts to contribute to the improvement of conveniencein social life and reduction of environmental burdens for tenant employees, residents, and local residents.

DOI has opened kitchen cars on the premises of its properties to improve the satisfaction of office workers
and neighborhood residents and to create a lively atmosphere in the outer gutter space during lunch time.
In addition, in order to revitalize the area surrounding the properties, DOI is contributing to the sustainable
development of the local community through participation in local events hosted by the Town Development
Council and private organizations.

DLI is working toward the installation of Amazon delivery lockers in some of its rental units. In addition, DLI
has introduced a Unitholder Benefit Program as an opportunity for unitholders to experience the highquality management capabilities and services provided by operators of healthcare facilities.

DOI

Holding of Shinjuku Minamilumi(Shinjuku Maynds Tower )Cooperation for events held in the
Yokohama Portside area
(CONCURRED Yokohama)

Installation of Amazon Delivery Lockers（Aira no mori Higashi-Ofuna）

Introduction of unitholder
special benefit plan

Charity Activities

The Asset Manager has also introduced "Jeans Day," which Daiwa Securities Group Inc. has been working
on. Every Friday, employees come to work in light clothing such as polo shirts and jeans to raise funds forcharities such as medical assistance and self-help for children. In addition, the Asset Manager displays
artwork by people with disabilities in its meeting rooms and hallways to support their participation insociety through art activities and donates surplus calendars and notebooks. Through the installation of
donation-type vending machines in the properties it owns, DOI supports activities to donate a portion of
the proceeds to NPOs and other organizations that provide pediatric medical support and child abuse
prevention activities.

Outsider Art Exhibit（Reception desk of the AssetManagement Company)

Implementation of Jeans Day

Installation of donation-type

vending machines（DaiwaTsukishima）

DR

Each Investment corporation formulates BCP measures for the properties it owns to ensure the safety oftenants, employees, and facility users in the event of an emergency disaster, and to ensure the continuation ofimportant business operations. In cooperation with property management companies and building
management companies, we distribute disaster and crime prevention handbooks to tenants when they movein, post evacuation routes on digital signage in common areas, and conduct regular disaster drills. In addition,
for those properties where we are able to install such equipment, we have installed AEDs, disaster relief
vending machines, and emergency supply storage boxes in the EVs.

Initiatives for Investors

Conduct disaster drills（ Shinjuku Maynds Tower ）Installation of EV
emergency supply
storage boxes

Each Investment corporation strives to actively disclose information and fulfill its accountability to all
stakeholders through IR activities and other means. To promote understanding of each investment
corporation's operating conditions, we hold individual meetings with domestic and foreign institutional
investors and participate in seminars for individual investors.

DOI
Installation of electric
kickboards(Park Terrace Ebisu)

DLI

Disaster Prevention Initiatives

Installation of disasterprevention stockpile

Attracted kitchen cars
(Daiwa Nakano-Sakaue)

12

ESG Data

DLI

Year held

No.of Domestic
investors

No.of Foreign
investors

No.of Seminar
held

FY2022133

52

2

FY2021

FY2021

FY2022

116

146

146

54

30

34

3

2

3

Initiatives for an Aging Society / introduction of nursing care DX （DLI）

DLI is currently the largest healthcare facility investment by a J-REIT, and aims to solve the social issue ofthe aging society that Japan is facing. At healthcare facilities owned by DLI, operators have introduced
Nursing Care DX to improve the comfort of residents and increase the work efficiency and reduce theworkload of nursing care staff.

Good Time Living “Care-wing
Facility version”

HITOWA Care Service “LIFELENS”

AS PARTNERS “EGAO link”

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

ESG Data

Initiatives for Human Rights and Promotion of DEI
Formulation of Daiwa Securities Group Human Rights Policy

The Daiwa Securities Group's corporate philosophy states that “the Group will strive to maintain a high sense of
morality and duty, endearoring to continue contributing to the sustainable growth of the societies in which we
operate“. In October 2022, to further improve a corporate culture rooted in the basic principles of respect forhuman rights, and to promote efforts for the respect of the human rights in accordance with international
standards, it has established this Human Rights Policy.

Daiwa Securities Group Human Rights Policy
1.Respect for International Standards
Daiwa Securities Group supports and respects international standards on human rights, such as theInternational Bill of Human Rights (consisting of the Universal Declaration of Human Rights and theInternational Covenants), the UN Guiding Principles on Business and Human Rights, the ILO Declaration on
Fundamental Principles and Rights at Work, the OECD Guidelines for Multinational Enterprises, ISO 26000,
and Children's Rights and Business Principles. We also endorse the Ten Principles of the UN Global Compact
as a signatory to the UN Global Compact.
2.Scope of Application
This Policy applies to all companies, officers, and employees within Daiwa Securities Group. We also expect
all stakeholders, such as customers and suppliers, to respect human rights.

3.Prohibition of Human Rights Violations
Daiwa Securities Group provides an equitable and safe working environment that values people, and isconsiderate of the human rights of all stakeholders. We do not tolerate discrimination based on race,
nationality, birthplace, creed, religion, politics, biological sex, sexual orientation, gender identity, social
status, physical characteristics, or disability, or human rights violations such as sexual harassment, power
harassment, or other acts of harassment in any aspect of our work. Furthermore, we do not tolerate unfair
labor, such as child labor and forced labor.
4.Human Rights Due Diligence
Daiwa Securities Group conducts appropriate human rights due diligence and is committed to preventing
and mitigating any negative impact its corporate activities may have on human rights.
5.Remedial Mechanisms
Daiwa Securities Group takes corrective and remedial actions through appropriate procedures in the event
it becomes clear that its corporate activities have caused or been involved in a negative impact on humanrights.

6.Education and Training
Daiwa Securities Group educates and instructs all officers and employees with accurate information onhuman rights. At the same time, we view human rights issues as our own problem, not somebody else's
problem, and foster a sensitivity that enables empathy with the suffering of others.

7.Information Disclosure
Daiwa Securities Group is committed to disclosing information on its human rights initiatives and progress
on its website and through other media to ensure that they are understood by all stakeholders.
8.Stakeholder Engagement
Daiwa Securities Group implements this Policy with an emphasis on dialogue with stakeholders.

9.Governance System
Daiwa Securities Group has established a Human Rights Awareness Promotion Committee, chaired by the
Human Resources Officer, to promote human rights initiatives. This Policy is determined by the Board of
Directors.

13
DR

Initiatives to Respect Human Rights

The Asset Manager promotes human rights initiatives based on the “Daiwa Securities Group Human
Rights Policy". The compliance manual stipulates "respect for human rights and prohibition of
discrimination, sexual harassment, etc." and all officers and employees, including temporary employees,
are thoroughly informed of this policy through compliance training and other means. In the future, wewill further strengthen our human rights education and awareness efforts, and encourage all
stakeholders to understand this policy and comply with it to ensure respect for human rights.

Promoting Diversity Equity & Inclusion (DEI)

In its Sustainability Policy formulated in 2023, the Asset Management Company has set "promotion ofdiversity, equity, and inclusion (DEI)" as one of the major issues to be addressed. The Asset Manager isworking to create a work environment where each and every employee can fully demonstrate his or
her abilities and work with vitality, regardless of age, nationality, gender, values, or disabilities.

Formulation of general business owner action plans/Disclosure of information
on women's activities

In accordance with the Law for Measures to Support the Development of the Next Generation and theLaw for the Promotion of Women's Advancement, the Asset Manager has formulated a "General
Business Owner Action Plan" with the aim of creating a comfortable employment environment and aworkplace environment where female employees can work for a long time. The company encourages
efforts to provide opportunities for dialogue on balancing childcare and work, for example, by holding
follow-up lunches for those who have taken childcare leave and wish to return to work.
Divergence rate ofaverage continuous
service years for men
and women
Average rate of paid
leave taken by all
employees（※）

FY2018FY2019FY2020

FY2021

FY2022

66%

78%

73%

80%

84%

0.60

0.63

0.82

0.91

0.88

※ For more information on the General Business Owner Action Plan and information on women's activities, pleaserefer to the Asset Manager's website.

＜ Reference: Daiwa Securities Group Management Vision " Vision 2030" ＞

The Daiwa Securities Group has identified "Diversity and Inclusion" as one of the priority areas in its"Vision 2030" as the foundation for sustainable management. The Daiwa Securities Group has identified
two key issues on which it should place particular focus: fostering human resources who can provide
added value, and building an organization where everyone can pay an active role by acknowledging
diverse personalities.

Top Message/
Summary

Sustainability Report 2023

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

ESG Data

Initiatives for Human Resource Development

14
DR

The source of the Daiwa Securities Group's competitiveness is its human resources. It values the creativity of each and every employee, foster a free and vigorous corporate culture full of a challenging spirit, and properly evaluate
employee abilities and contributions. Human resources are their most important asset, and it supports the realization of autonomous career development by enhancing human resource development, training programs, andsupport for qualification acquisition so that employees can grow and achieve self-fulfillment through working at the Asset Manager.

Daiwa Securities Group Corporate Philosophy

Daiwa Securities Group has four corporate principles. They are “building trust,” “placing importance on
personnel,” “contributing to society,” and “maintaining healthy earnings results.” It has nurtured our
corporate culture since the foundation of its business, and regard it as the core of Daiwa’s identity.
It has taken steps to crystallize the basic philosophy and mindset of the Group inherent in its culture to be
manifested as the “Daiwa Spirit.”

Approach to Human Resource Development/In-House Training and Education System

The Daiwa Securities Group aims to be a group of true professionals who love their work and continue tochallenge high goals. In order to become a professional, employees are required to work tirelessly toward thecareer they aspire to in the future, in addition to the elements necessary for their current work. The AssetManager has established the following in-house training and education programs, in which employees also
participate.
(Company-wide training)
Training for the entire company includes compliance training and sustainability training.
(Professional Development Programs)
With the aim of improving employees' professional skills, the Asset Manager has established training
programs such as "LEC e-Learning Training" and "Daiwa Real Estate Academy" by external organizations and"Daiwa Securities Skills Training" by the Daiwa Securities Group, which employees may voluntarily
attend.(For specific examples of the content of each training program, please refer to p. 23 of thisdocument.) ).
(Management training for managers)
The Daiwa Securities Group has established the Daiwa Leadership Program and the Daiwa Management
Academy as selective training programs for managers as an opportunity to develop human resources who
can become the next generation of potential leaders.
Since entering the company

DAIWA REAL ESTATEACADEMYAManagement Training for Managers

Daiwa Management
AcademyQualification Acquisition Support System （ Below are the main qualifications ）Real Estate Transaction Agent

ARES Certified MasterIn addition to hiring talented personnel from outside the company, the Asset Manager has concluded a"Sponsor Support Agreement Concerning Cooperation in Securing Human Resources, etc." with Daiwa
Securities Group Inc. and accept employees on secondment from the Daiwa Securities Group to promote
the sharing and passing on of expert opinions and skills related to real estate asset management, and to
improve the sustainability of the entire organization. The Asset Manager has also introduced an "intra-group
recruitment system" to open up new career paths for employees with the desire and ability to achieve selffulfillment.
Secondments from sponsor

FY202028

Chartered Member of The Security
Analysts Association of Japan

FY2021

FY202228

27

Qualification Acquisition Support

The Asset Manager supports its employees so that they can demonstrate a high level of expertise as
professional personnel. The Asset Manager provides support for the acquisition of qualifications to improve
employees' abilities, such as training and examinations for various qualifications, including real estaterelated qualifications such as certified real estate transaction agents and certified masters of the Association
for Real Estate Securitization, as well as covering the costs of maintaining qualifications.
(Main Qualification Holders)

Real Estate Transaction AgentsFirst-Class Architect

Since managerial position

Daiwa Leadership Program

Strategies for securing/training human resources

Certified Building Administrator

Professional Development Programs
Daiwa Securities Skills
Training

The Asset Manager conducts semi-annual performance evaluations and reviews of all employees, withbonuses paid based on the degree of achievement of semi-annual goals. Through periodic evaluation
measurements and feedback, the Asset Manager encourages employee career development and has
established a transparent personnel evaluation system.

ARES Certified Master

Compliance Training ・Sustainability Training

LEC e-Learning Training

Personnel evaluation feedback

Real Estate Consulting Master
Real Estate Appraiser

Chartered Member of The Security Analysts
Association of Japan
Certified Public Tax Accountant

Number of holders
71
43
11
8
8
1

12
2

※ Number of employees of the Asset Manager in FY2022: 118 (As of March 31, 2023)(Qualification Support Usage Results)
Number of qualification support utilization
Qualification fee per person

FY2022
48

8,408yenSustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

ESG Data

Initiatives to Achieve Diverse Work Styles /Initiatives for Health and Comfort

15
DR

The Daiwa Securities Group believes that maximizing the engagement of each and every employee will lead to higher customer satisfaction and ultimately higher shareholder value. The Asset Manager is actively working tocreate a comfortable work environment and promote employee health, etc., so that each and every employee can feel fulfilled in their work.

Creation of Comfortable Working Environment

The Asset Manager has installed free vending machines, cafeteria space, Wi-Fi and other telecommunication
environment in the office area and meeting rooms, and introduced a free address system in order toimprove the office space with consideration for the comfort of employees, and is striving to create aworkplace environment that supports diverse work styles and enhances productivity.

Benefits and Work-Life Balance

Cafeteria Space/Office Space

The Asset Manager has introduced a flextime system, a teleworking system, an hourly paid leave system,and other systems to enable employees to work in diverse ways according to their individual lifestyles
and work characteristics. The following systems have been established to help employees achieve a
better work-life balance so that they do not have to give up work due to life events such as childbirth,childcare, or nursing care.
All Employees
Consecutive holiday, flextime, medical checkups, Life Support paid holiday, Telework system

Childrearing
Childcare leave, Childcare Support Leave, Pre-childcare leave for male employees, Short working hours
system, Exemption/restriction on overtime work, Nursing care leave, Daycare subsidy, Babysitter system,
Support desk for employees looking for nursery schools
Female Employees
Daiwa ELLE Plan

Nursing Care
Nursing care leave, Nursing care-support leave
FY2020

FY2021

FY2022Return rate from child care leave

100％

100％

80％

Childcare Support leave usage rate

100％

100％

100％

Childcare leave takers

Childcare Support Leave takers
Nursing care leave takers

Employee Satisfaction Survey

6

2

0

10
6

0

5

Initiatives for Health Care

In its health and safety efforts, including labor management and crisis management, the Asset Manager
emphasizes the prevention of overwork and the proper understanding of working hours, and strives to improvelabor productivity and maintain employee health by appropriately monitoring working hours. It concludes
labor-management agreements (36 agreements) on overtime work with employee representatives. As a new
initiative, since February 2023, the lights have been automatically turned off in the office area of the AssetManager every certain time after 7:00 p.m., in an active effort to reduce overtime hours. In addition, in order tomaintain the health of its employees, it provides subsidies for various expenses such as the expenses for medical
checkups and influenza inoculations, etc., and also making efforts to thoroughly conduct stress checks andmedical examinations, require employees to take long consecutive vacations, improve the rate of paid vacations
taken, etc.
Percentage of employees who took
the stress check

Paid holiday usage rate

Yearly paid holidays taken perpersonAnnual Prescribed Working Hours
per Person
Average monthly overtime hours
per person

FY2020

FY2021

FY2022

72％

77％

74％

FY2020

FY2021

FY2022

24.6

23.1

18.7

94％
16.6

1837.5

94％
17.8

1830.096％
17.0

1837.5Initiatives to Promote Wellness

Daiwa Securities Group has implemented measures to prohibit smoking on all surfaces during working hours
and to improve health awareness. In June 2022, the Group began offering subsidies for dental checkups to all
insured employees of Daiwa Securities Group, and launched the "Good Sleep Daiwa - Good Sleep Daiwa
Project" as an initiative to improve employees' sleeping skills. Reflecting the opinions of the employee
satisfaction survey, the Asset Manager, upon the initiative of its employees, has continued to hold "Shuffle
Lunch Meetings" to revitalize internal communication, which had become scarce with the Corona Disaster,and subsidized the expenses for the meetings.

20

The asset Manager believes that it is important to reflect the views of employees in organizational management
and utilize them in various measures, etc. , in order to build a better workplace environment . To this end, it
conducts employee satisfaction surveys by an external organization and utilizes the survey results to improve theinternal environment.
.

Cost assistance for dental checkups

Responding to Harassment

Good Sleep Daiwa Projiect

Shuffle Lunch Meetings

The Asset Manager conducts regular harassment training to raise the sensitivity and awareness of officers andemployees to harassment, while making them aware of the Compliance Consultation Window. In addition, theAsset Manager grasps the actual situation of harassment during the biannual self-assessment of career plans.

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

Corporate Governance Structure

ESG Data

DR

The organization of each Investment Corporation consists of a general meeting of unitholders, a board of directors consisting of one executive director and two supervisory directors, and an accounting auditor.

Investment Corporation Institutions（a）General Meeting of Unitholders
Certain resolutions, which are stipulated in the Act on Investment Trusts and Investment Corporations or thearticles of incorporation, are adopted at the General Meeting of Unitholders.
Unless otherwise stipulated in the law or articles of incorporation, resolutions of the General Meeting ofUnitholders shall be adopted by a majority of the voting rights of the unitholders present. However, for certain
important matters such as amendments to the articles of incorporation, resolutions (special resolutions) must
be adopted by two-thirds or more of the voting rights of the unitholders present at a meeting whereunitholders holding a majority of the investment units issued and outstanding are present.
（b）Executive Director, Supervisory Directors & Board of Directors
The executive director has the authority to execute the business of the investment corporation and to perform
any judicial or extrajudicial acts related to the business of the investment corporation on behalf of theinvestment corporation. The supervisory directors have the authority to supervise the execution of duties by
the executive directors. The Board of Directors, which is composed of all executive directors and supervisory
directors, has the authority to approve the execution of certain duties, as well as the authority stipulated in theInvestment Trust Law and the Articles of Incorporation, and the authority to supervise the execution of duties
by the executive directors.
（c）Accounting Auditor
An accounting auditor is appointed for each Investment Corporation. The accounting auditor audits thefinancial statements, etc. of the investment corporation and reports to the supervisory directors in the eventthat it discovers any wrongful act or material fact in violation of laws, regulations, or the Articles ofIncorporation in connection with the execution of duties by the executive directors, and performs other duties
as stipulated by laws and regulations.

Structural Chart of the Investment Corporation(DOI)①Asset management contract / General administrative contract related②General administrative affairs contract / Asset custodian contract③Unitholder register, etc. management contract / Special account management contract④Sponsor support agreement⑤Fiscal agency agreement

16

Structural Chart of the Investment Corporation(DLI)

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

Compliance Structure

Basic Policy on Compliance

The Asset Manager fully recognizes that non-observance of compliance could shake the managementfoundation of the investment corporation or fund for which the Asset Manager is entrusted with or advises on
asset management, as well as the Asset Manager, and has positioned thorough compliance as a basic
management principle.

Compliance Structure

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

ESG Data

17
DR

Investment decision-making system

As an asset management company under the Act on Investment Trusts and Investment Corporations that is
entrusted with asset management by the Investment Corporation, the Asset Manager prepares, in line with the
Articles of Incorporation, asset management guidelines to stipulate basic approaches to investment management,such as the investment policy, rules on transactions with interested parties regarding acquisition and sale of assets,etc. and the disclosure policy.

The Asset Manager is committed to honest and fair corporate activities, not only in strict compliance with alllaws and regulations related to its operations, various regulations, bylaws and market rules but also in fullawareness of social norms.

※When transacting (acquiring or transferring real estate or securities, or leasing) with interested persons under the
Act on Investment Trusts and Investment Corporations, approval by the Board of Directors of the Investment
Corporation is required except for certain cases.

Appropriate Management of Conflicts of Interest

In cases where transactions may be at risk of conflicts of interest concerning the financial instruments business orother related operations, the Asset Manager shall comply with the Financial Instruments and Exchange Act, the Act
on Investment Trusts and Investment Corporations and other related laws and regulations, and the separately
provided rules on measures against conflicts of interest. The rules on prevention of conflicts of interest provide thefollowing terms and conditions individually for each of the following transactions:(a)Board of Directors
The Board of Directors, as the decision-making body for basic matters related to the promotion of compliance,
decides on the establishment and revision of rules and regulations, as well as other important compliancerelated matters.
(b)Compliance Committee
The Compliance Committee, as an independent body from the Board of Directors, deliberates and resolves onmatters related to compliance. The Compliance Committee consists of the Compliance Officer, the General
Manager of the Internal Control Office, the General Manager of the General Affairs Department, and an outside
specialist familiar with compliance matters.

(C)Compliance Officer
The Compliance Officer, as the chairman of the Compliance Committee, oversees internal compliance mattersand plans, drafts, and promotes overall compliance.
(d)Compliance Manual
The Compliance Manual has been formulated as a specific guide for officers and employees to implement
compliance activities.

(e)Compliance Program
As a specific implementation plan to achieve compliance, a "Compliance Program" is formulated in principle
for each fiscal year of the Asset Manager and revised as necessary.

1) Asset Acquisition
In case of acquiring real estate or real estate trust beneficiary rights from interested parties, the acquisition priceshall be at 100% or less of the appraisal value as appraised by a real estate appraiser. In the case of other assets, theacquisition shall be made at fair value price. However, if the fair value measurement is not applicable, theacquisition shall be at the value reasonably estimated by an expert independent from the asset managementcompany.
2) OtherIn cases other than asset acquisition, such as asset sale, asset leasing, entrustment of property management
operations, entrustment of intermediation operations for real estate acquisition, sale or leasing and placement ofconstruction orders, where such involves interested persons, the transaction shall be implemented in line with therules on measures against conflicts of interest.

Conflict of Interest Rules

In case of competition over a property acquisition opportunity among the Investment Corporation and other funds,
etc. managed by the Asset Manager, conflicts of interest among the Investment Corporations and other funds, etc.
shall be prevented by first granting the Investment Corporation the preferential right to consider the acquisition.
The acquisition opportunity will be available to the other funds, etc. only when the Investment Corporation decides
not to exercise the concerned preferential right.
Furthermore, in the case of rental residences, the Asset Manager shall prevent arbitrary distribution of property
information and avoid conflicts of interest among Daiwa Residential Private Investment Corporation, Daiwa
Securities Living Investment Corporation and other funds, etc. by establishing the "Rotation Rule."

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

18

ESG Data

Risk Management Initiatives

DR

Daiwa Securities Group recognize the importance of identifying and evaluating the various risks associated with our business operations accurately, and controlling them effectively, while we pursues profitability and growth. We aim to
maintain a sound financial base and profit structure by properly balancing risks and returns and appropriately control not only short-term risks but also risks that are likely to appear in the medium- to long-term, such as climate changerisk. By doing so, we seek to achieve sustainable improvement in corporate value.

Risk Management Initiatives(Basic Policy on Risk Management)
The Asset Manager, from the standpoint of managing client assets, fully recognizes that inadequate risk
management could cause undue damage to clients, resulting in loss of trust and shaking the Asset Manager's
business foundation, and has positioned the thorough implementation of appropriate management ofvarious risks as a basic management principle. In addition, as a company engaged in the financial
instruments business, we recognize that we have a responsibility to strive to realize the business value of theAsset Manager as required by society, and we will actively and tirelessly work to establish a risk management
system and properly manage risks based on the Asset Manager's management policy and strategic objectives.
(Risk Management Regulations)
The "Risk Management Regulations" are established for the purpose of ensuring appropriate business
operations and thereby ensuring sound management by setting forth basic matters pertaining to risk
management at the Asset Manager, clarifying the basic approach to risk management, and establishing aninternal management system.

Establishment of Tax Policy

In order to enhance tax corporate governance, Daiwa Securities Group has established "Daiwa Securities
Group Tax Policy" which serves as a code of conduct and decision-making standards for taxation.

Protection of information assets

The Asset Manager has established Rules for the Protection of Information Assets with the aim of properly
utilizing corporate information and preventing unauthorized access and loss or leakage of corporate
information.
The regulations ensure thorough information management by stipulating the management of confidential
information, access restrictions for outsiders, prevention of information leaks, maintenance of information
systems and education and audits related to information system management.

(Risk Management System)
In order to manage risks, the Asset Manager has appointed a person designated by the Representative
Director from among its directors as the "Chief Risk Management Officer" to oversee the development ofan appropriate risk management system. In addition, the Asset Manager has established the "RiskManagement and Compliance Department" as a risk management control division, and designates thegeneral manager of each department as the "Risk Management Officer" to promote appropriate risk
management.

Whistleblowing System

Anti-bribery and Anti-corruption Policy

Status of Compliance Training

The Asset Manager stipulates in its "Rules of Employment," "Compliance Manual," etc. that it will not engage
in bribery, embezzlement, money laundering, or other improper acts, and that it will strictly punish those who
engage in such improper acts. In the Compliance Manual, we prohibit the offering, giving, or promising of
improper benefits, and prohibit entertainment or gifts to business partners beyond what is sociallyacceptable, and furthermore, we prohibit the offering, giving, or promising of bribes or improper benefits. All
employees submit a written pledge once a year regarding the presence or absence of entertainment or gifts
received from business partners, etc., and we check within the company for any instances of impropriety.

Establishment of a system to eliminate antisocial forces

In order to ensure the soundness and fairness of the securities market and to ensure the safety of customers
and employees, Daiwa Securities Group Inc. has set an policy to establish a system to eliminate antisocial
forces such as organized crime groups, persons related to organized crime groups, and general meetingrooms, and will take organized measures to sever all relationships with these forces. The Asset Manager has
established the "Standards for Dealing with Antisocial Forces" and the "Antisocial Forces Check Manual" andis determined to take a firm attitude toward antisocial forces in order to sever any and all relationships.
In addition, in cooperation with the Daiwa Securities Group, the Asset Manager has established andimplemented a screening system for antisocial forces at the time of transactions, introduced clauses for theelimination of organized crime groups in contractual documents with business partners, and conductedthorough confirmation at the time of transactions in accordance with the Act on Prevention of Transfer of
Criminal Proceeds. The Asset Manager have also established a system for screening our business partners.

The Asset Manager has established a whistleblowing system for all employees (part-time, contract, seconded
from other companies and temporary).
This system enables anonymous reporting and, in compliance with the Whistleblower Protection Act,prohibits firing, disciplining, retaliating against or subjecting the whistleblower to any other disadvantageous
treatment on account of their report.

The Asset Manager periodically conducts compliance training as below for all officers and employees, including
temporary employees, to ensure compliance and raise awareness. The topics covered include "Elimination of
Anti-Social Forces" "Prevention of Money Laundering and Countermeasures against Terrorist Financing" "Fair
Competition" "Information Security" " Prevention of Insider Trading" and "Business Entertainment and Gifts,“
as stipulated in the Compliance Manual and the participation rate for these training is as follows.

Compliance training (number of times conducted)

Compliance training (training hours per person)

FY2020

FY2021

FY2022

Total 2hours

Total 2hours

Total 2hours

Year Held

Training participation rate

2nd half of FY2021

100.0%

1st half of FY2021
1st half of FY2022

2nd half of FY2022

100.0%
100.0%
100.0%

twice

twice

twice

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

Sustainability Finance

19

ESG Data

DOI

DLI

Each Investment Corporation has developed a financing framework to provide investors with ESG investment opportunities through sustainability finance, and promotes ESG investment through bond and loan financing.

Green Finance Initiatives(DOI)

Social Finance Initiatives DLI)

（ Evaluation by external organizations ）The Investment Corporation has established the Green Finance Framework under the belief that providing
investment opportunities for investors who are active in ESG investment through green financing is ofsocial significance. DOI has received Green 1(F), the highest rating in “JCR Green Finance Framework
Evaluation” from Japan Credit Rating Agency, Ltd. as a third-party evaluation for the Green Finance
Framework.

（ Evaluation by external organizations ）DLI has developed a Social Finance Framework to provide investors with ESG investment opportunities
through social finance, and has received the highest rating of "Social1(F)" from Japan Credit Rating Agency, Ltd.

【Eligible criteria】
Properties which have received or will receive any of the following certifications from third-party certification
bodies(1) DBJ Green Building Certification：3～5 Stars(2) CASBEE for Buildings：B+ Rating, A Rating or S Rating（ CASBEE-Building (new construction), CASBEEReal Estate, CASBEE for Municipalities ）(3) BELS Certification：3～5 Stars(4) LEED Certification：Silver, Gold or Platinum【Eligible criteria】
1.Nursing homes(1)Pay nursing homes：①Nursing care type②Healthy type③Residential type(2)Serviced senior housings(3)Other nursing homes
2.Medical facilities(Hospitals / Clinics / Medical malls)

1.Use of Procured Funds
Funds raised through green bonds or green loans will be used to acquire properties that meet the following
eligible criteria or to refinance the funds.

1.Use of Procured Funds
Funds raised through social bonds or social loans will be used to acquire properties that meet the following
eligible criteria or to refinance the funds.

2.Evaluation/selection Process of Projects
Under the advice of the asset management personnel of the Asset Manager, the Finance Department willconsider the suitability for eligible criteria, and then evaluate and select the projects.
Raising funds through green financing for the project is examined by the Asset Manager’s Sustainability
Promotion Committee, deliberated by the DOI Investment Committee and the Board of Directors, andapproved by the Board of Directors of the Investment Corporation.

2.Evaluation/selection Process of Projects
Under the advice of the asset management personnel of the Asset Manager, the Finance Department willconsider the suitability for eligible criteria, and then evaluate and select the projects.
Raising funds through Social Finance for the project is examined by the DR Sustainability Promotion
Committee, deliberated by the DR Investment Committee and the Board of Directors, and approved by the
Board of Directors of Investment Corporation.

3. Management of Procured Funds
DOI will set the total acquisition price of Green Eligible Assets as the maximum amount of Green Bondissuance and will manage and internally track and control the appropriated funds on a portfolio-byportfolio basis to ensure that the outstanding amount of Green Bonds does not exceed the total acquisition
price of Green Eligible Assets for as long as the Green Bond issuance remains outstanding.
If all or a portion of the funds raised by Green Bonds are not immediately allocated to Green Eligible Assets,
DOI will identify unallocated funds and manage all or a portion of the proceeds in cash and cash equivalents
until such time as the funds are allocated to Green Eligible Assets.

3. Management of Procured Funds
If there are unallocated funds, the funds raised will be managed in cash or equivalent until the full amount of
the funds raised is allotted.
Even after the full amount has been allocated, if the assets for which the funds are used are excluded from theportfolio due to sale, etc., the funds will be managed appropriately by the portfolio management.
【Portfolio management （Every fiscal period）】
Total balance of Social Finance ≦ Social Finance eligible debt limit（Total acquisition price of assets thatmeet the eligible criteria x Total assets LTV）

4. Impact Reporting
DOI publishes the status of fund appropriation, certification of Green Qualified Assets, and environmental
performance indicators on its website on an annual basis for as long as there are outstanding Green Bonds
issued. Please refer to the website for details of the fund appropriation status reporting and impact
reporting (status of certification of green qualified assets and quantitative indicators related to green
qualified assets).

4. Impact Reporting
DLI publishes on its website on an annual basis the status of application of funds raised through social
finance and impact reporting (number of healthcare facilities acquired, occupancy rate, and amount invested
in healthcare facilities).

Social finance procurement amountGreen finance procurement amountGreen Loan Outstanding

Green Bonds Outstanding

Total 8.3
billion yen
Total 3.9
billion yen(End of March 2023)

Social Loan Outstanding

Social Bonds Outstanding
Examples of Green Finance Applications（Daiwa Harumi)

Total 9.92
billion yen

Total 2.0
billion yen(End of March 2023)

Examples of property acquisitions using social
finance(Charm Premier Kamakurayama, SunnyLife Shibaura)

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

20

ESG Data

External Assessments

DOI

DLI

DR

Each Investment Corporation is working to improve its score by obtaining external evaluations by third parties in order to enhance the reliability and objectivity of the results of its efforts to reduce environmental impact, as well as toincrease the medium- to long-term value of the properties it owns.

GRESB Real Estate Assessment

GRESB is a benchmark for measuring the sustainability performance of the real estate sector, created in 2009 bya group of major European pension funds. Leading institutional investors are members and use GRESB in theirreal estate investment management process.
DOI and DLI will continue to participate in the GRESB Real Estate Assessment, and their respective ratings in the2022 GRESB Real Estate Assessment are as follows（ Key Assessment Points ）・DOI and DLI have received the "Green Star" rating, the highest rating given to outstanding participants in boththe "Management Component," which evaluates the company's policies and organizational structure for ESG
promotion, and the "Performance Component," which evaluates the environmental performance of theproperties owned and efforts with tenants.
・DOI has received the highest "5-star" rating in the GRESB Rating, a five-level rating system based on the global
ranking of overall scores.
・DOI and DLI also received the highest "A Level" rating in the GRESB Disclosure Assessment, which measuresthe level of ESG information disclosure, for their efforts in ESG information disclosure.

Type of Assessment

Contents
Evaluates ESG performance interms of “management & policy”
and “asset portfolio performance”

GRESB Real Estate
Assessment

Assessment
Results(DOI)

Highest Rating
Green Star
（Obtained for theeleventh consecutive
years）
Highest Rating
5StarsHighest Rating
Green Star
2StarsRelative assessment based on the
total score (GRESB Rating)

Evaluates the level of ESG
disclosure

Using an ESG evaluation framework created by MSCI ESG Research LLC, the
MSCI ESG rating assigns a rating on a seven-tiered scale, ranging from “AAA”
to “CCC,” based on exposure to industry-specific ESG risks and management
capabilities for handling those risks in comparison with other companies inthe same industry. The MSCI ESG rating is one of the parameters for listing
companies on the MSCI Japan ESG Select Leaders Index, which is used by theGovernment Pension Investment Fund as an ESG index for passive
management, as well as being used by over 1,300 institutional investors
around the world and in the creation of over 1,000 investment indexes. In the
MSCI ESG ratings, DOI has a "BB" rating (as of April 2023) and DLI has a "BB"rating (as of April 2023).

MUFG ESG Rating Certificate for J-REITs Supported by JCR（DOI）

The MUFG ESG Rating Certificate for J-REITs Supported by JCR is a system that assesses
companies’ ESG-related initiatives based on original ESG-related check items, with
Mitsubishi UFJ Research & Consulting Co., Ltd. (MURC) as the service provider and theJapan Credit Rating Agency (JCR) as the support company. It is a specialized product for
J-REITs that, in addition to assigning a score, provides feedback on the assessment
results, current issues, etc.
DOI has acquired the highest “S Rank” for the MUFG ESG Rating Certificate for J-REITs
Supported by JCR.

Reference: Efforts to achieve the SDGs

The Daiwa Securities Group is working to achieve the Sustainable Development Goals (SDGs) under the"Passion for SDGs: Daiwa Securities Group SDGs Declaration," and the Asset Manager, DOI and DLI are also
promoting activities to solve sustainability issues under this policy.

SDGs Sustainable Development Goals

Highest Rating
A（Obtained for two
consecutive years）
GRESB Public
Disclosure

Assessment
Results(DLI)MCSI ESG Rating

Highest Rating
A

International Goals to 2030 adopted at the UN Summit in September 2015. It sets out 17 goals and 169
targets to achieve a sustainable world. It is characterized by the fact that it calls into question the stateof not only developing countries but also developed countries including Japan, and pledges to "leave
no one behind" in the process of its efforts.

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

External Certifications

21

ESG Data

DOI

DLI

Each Investment Corporation and the Asset Management Company are aiming to increase the ratio of environmental certifications acquired in order to enhance the reliability and objectivity of the results of their efforts to reduce
environmental impact, and at the same time, to increase the medium- to long-term value of the properties they own.

① Acquisition of Environmental Certifications(DOI)

・Number of properties with environmental certifications ：32
Percentage of environmental certifications acquired ：61.5%（ As of Fiscal Period ended November 2022 (34thperiod) ）・As a mid- to long-term goal：DOI aims to increase the ratio of environmental certifications in the entire portfolio
to 70.0% by FY2030(Acquisition results)

Number of properties
with certification

Percentage of certification（based on total floor area）

FY2020 FY2021 FY2022
31

31

32

60.3%

61.3%

61.9%

Percentage of certification

Number of properties

CASBEE

with certification

DBJ（based on number ofproperties）

29

2

BELS

Total（※）

32（based on total floor area）(As of November 30, 2022)
Certified Area

49.2%

260,801.23㎡

5.1%

19,372.37㎡

3.4%

3

61.5%

54.2%

Percentage of certification（based on total floor area）

51.0%

82,282.76㎡

314,621.82㎡② Acquisition of Environmental Certifications(DLI)

16.1%

3.8%

61.5%

(As of November 30, 2022)

・Number of properties with environmental certifications ：21
Percentage of environmental certifications acquired ：15.8%（ As of Fiscal Period ended March 2023 (34th period) ）・As a mid- to long-term goal： DLI aims to increase the ratio of environmental certifications in the entire portfolio
to 20.0% by FY2030(Acquisition results)

Number of properties

FY2020 FY2021 FY2022

with certification

Percentage of certification（based on total floor area）

CASBEE
DBJ

BELS

Total

2

21

3.1%

3.0%

15.8%

Percentage of certification

Number of properties
with certification

2（based on number of

2
4

15

21

properties）

15.8%（based on total floor area）(As of March 31, 2023)
Certified Area

0.8%

19,961.72㎡

6.0%

62,865.32㎡

1.6%
8.5%

54,880.43㎡
137,707.47㎡

Percentage of certification（based on total floor area）

2.3%
6.3%
7.2%

15.8%

(As of March 31, 2023)③ Overview of Environmental Certification

CASBEE for Real Estate Certification
CASBEE for Real Estate certification is a system for evaluating the overall
environmental performance of buildings which have been developed inJapan and whose use is becoming more widespread there. It rates buildings
on a five-tiered scale from “S Rank” (superior) to “C Rank” (lacking) based on
environmental measures such as the use of energy-efficient equipment andequipment with a small environmental footprint, as well as building quality,
including consideration of interior comfort, the view, etc.
Click here for more details about the CASBEE for Real Estate certification
systemDBJ Green Building Certification

DBJ Green Building certification is a system created by Development Bank ofJapan (DBJ) to support environmentally and socially responsible real estate.
Based on an overall assessment including the environmental performance ofthe property as well as measures for various stakeholders (disaster prevention,community engagement, etc.), it evaluates and certifies socially andeconomically necessary real estate on a five-tiered scale, from five stars (thehighest rating) to one star (the lowest rating).
Click here for more details about the DBJ Green Building certification system
BELS Certification
BELS certification is a third-party certification system that rates housing andother buildings based on their commitment to disclosing energy-saving
performance based on the Act on the Improvement of Energy Consumption
Performance of Buildings by means of a BEI value calculated using primaryenergy consumption, in accordance with building energy consumption
performance standards stipulated by the national government. Evaluationand disclosure based on this system is performed by member organizations(registered housing quality assessment organizations, designatedconfirmation and inspection agencies, registered building surveyorganizations, etc.) of the assessment association who have notified ofperforming BELS-related duties. Buildings are assessed on a five-tiered scale,from five stars (the highest rating) to one star (the lowest rating).
Click here for more details about the BELS certification system※1 In calculating the acquisition ratio of environmental certifications, CASBEE certification, DBJ Green Builing
certification, and BELS certification are included.
※2 Properties that have acquired multiple environmental certifications for the same property are treated as a single
property when calculating the values for properties that have acquired environmental certifications and the ratioof ratios of acquisition of environmental certifications.
※3.The total floor area of condominium-owned buildings is calculated based on the ratio of ownership.
※4 The number of certified properties and the ratio of certified properties are the actual results as of the end of eachfiscal year.
※5 The figures for each environmental certification are calculated based on the number of properties and total floor
space as of the end of the most recent fiscal period within the fiscal year covered by each Investment Corporation
as follows.
(DOI) Number of properties as of the end of November 2022: 59, Total floor space of the entire portfolio: 511,529.03m2(DLI) Number of properties as of the end of March 2023: 248, Total floor space of the entire portfolio: 873,839.67m2

Top Message/
Summary

Sustainability Report 2023

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

GovernanceInitiatives

SocialInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

ESG Data (Environmental Initiatives)

DOI

Environmental Certifications / Examples of major property acquisitions(DOI)

Property

Property NameType

OfficeOfficeOfficeOfficeOfficeOfficeOfficeOfficeOfficeDaiwa Sarugakucho

Daiwa Harumi

Shinjuku Maynds Tower

Daiwa Misakicho

Daiwa Jinbocho 3-chome

OfficeOfficeOfficeDaiwa Nihonbashi Hongokucho

A

OfficeOfficeOfficeOfficeOfficeOfficeOfficeKirin NihonbashiAA

Daiwa Mita 2-ChomeA

E SPACE TOWER

Daiwa Shibuya Shinsen

A

A

OfficeDaiwa Tsukijiekimae

B+

OfficeDaiwa Nishi-Shinjuku

B+

OfficeOfficeOfficeOfficeOfficeOfficeDaiwa Kitahama

Daiwa Shibadaimon

Daiwa Shinagawa North

CONCURRED Yokohama

Shinjuku Maynds Tower

Total

29

E SPACE TOWER

Healthcare

CONCURRED Yokohama

2

A

★★★★
★★★

Granpark Tenjin★★

Irise Komae Bettei

AIP Kachidoki-Ekimae★★★★★

Aira no mori Shakujiikoen★★★★★

Senior Forest Yokohama-Tsuzuki★★★★★

Good Time Living Center-Minami・★★★★★

Platesia Center-Minami
Sunny Life Chofu★★★★★

Ishinkan Kamiooka★★★★★

PLAISANT GRAND★★★★

MINAMI YUKIGAYA★★★★

As Heim Tsunashima★★★
★★

Charm Premier Kamakurayama★★

Library Shin-Shibamata★★

Alpha Living
Total

★★★★★
★★★★★

Aira no mori Higashi-Ofuna

Takamatsu Konyamachi

BELS

★★★

Yokohama Bayside

Aira no mori Edogawa-Shinozaki

Healthcare

DBJ

2

4

★★
15

(As of March 31, 2023)

★★★
★
3

(As of March 31, 2023)

Daiwa Nihonbashi Bakurocho

willDo Kiyosumi

Good Time Living Center-Minami・Platesia Center-Minami

DLIA

The Residence Honmoku

Healthcare
Healthcare

CASBEE

Serenite Honmachi Grande

Sunny Life Hiyoshi

Healthcare★★★

TK Flats Shibuya

Healthcare
Healthcare

B+

Daiwa Nihonbashi Bakurocho
shinyon curumu

Healthcare

A

B+

Healthcare

HealthcareA

Daiwa Shinagawa Gotenyama

Healthcare

HealthcareA

Daiwa Ogikubo

Healthcare

Healthcare

AA

Chijikoukanmae Tower Residence

HealthcareA

Daiwa Shibuya Square

Daiwa Daikanyama★★

A

Nihonbashi Central Square

Rental housing

Rental housing

A

A

willDo Kiyosumi

Rental housing

A

Daiwa Hatchobori ekimae

Daiwa Nishi-Shimbashi

Property Name

Rental housing
Rental housing

AA

Daiwa Hatchobori ekimae West

Property

Rental housing

★★★★

A

Daiwa Nihonbashi Horidomecho

Daiwa River Gate

OfficeA

A

OfficeOfficeS

Daiwa Tsukishima

Daiwa Kayabacho

BELS

S

S

A

Daiwa Tsukiji

DBJ

(DLI)

Type

Daiwa Kanda Mikuracho

OfficeOfficeCASBEE

22

ESG Data

PLAISANT GRAND
MINAMI YUKIGAYA

Sunny Life Hiyoshi

Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

ESG Data (Social Initiatives)

Employees
MaleFemalePercentage of Female

Contract employees

FY2020

FY2021

FY2022

76

88

94

80

37

Average Years Employed
Male

FemaleDepartures

Rate of departure

SecondMalets from sponsor

2. Diversity Promotion
Number of directors（Including
part-time）
Male

FemaleRatio of Female directors

Number of managers
Male

FemaleRatio of Female managers

Number of employees in seniorhuman resources (age over 60)

38

32.2%

0

0

0

0

0

0

0

0

0

5

Male

Female

38

118

28.8%

(Ref.) Temporary employees

Male

39

132

30.7%

FemaleNew hires

127

32.7%

Male

Female3. Employee health, safety and comfort

FY2019
113

5

3

0

0
6

5

11

15

10

5

2

1

6

0

5

0

5

0

0

5

0

13

3

9

3
3

4.7

5.1

5.2

6.5

4.4

4.6

5.2

6.4

4.9
4

3.8%
26

5.4
3

2.7%
28

5.2

6.5

3

3

2.4%

2.6%

28

27

Paid holiday usage rate

FY2019FY2020

FY2021

FY2022

6

7

6

6

0

0%
84

7

0

0%
91

66

73

21.4%

19.8%

18
1

Acquisition of External
Assessments/Certifications

ESG Data

18
3

6

0

0%
99
82

17

17.2%
3

7

1

14.3%
90
71

19

21.1%
4

FY2019FY2020

FY2021

FY2022

18

17

18

17

78%

Yearly paid holidays taken perpersonChildcare leave takers

5

72%
6

77%

23

10

74%
5

Return rate from child care leave

100.0%

100.0%

100.0%

80.0%Childcare Support leave usage rate

50.0%

100.0%

100.0%

100.0%

97.0%

94.0%

94.0%

96.0%

Childcare Support Leave takers
Nursing care leave takers

Percentage of employees who took

the stress check

Annual regular working hours

Average monthly overtime hours perpersonNumber of fatal industrial accidents
Number of violations of labor

standards

2
0

2
0

6
0

2
0

1807.51837.51830.01837.5

0

0

0

0

0

0

0

0

20.3

24.6

23.1

18.7

4. Details of Qualification Support and Training / Main Training Programs
Number of qualification support
utilization

Qualification cost per person（yen/year）

Training hours per person

6

Sustainability
FinanceDR

Human Resource Data for the Asset Management Company
1. Basic Data

GovernanceInitiatives

SocialInitiatives

Training cost per person（yen）

FY2020

FY2021

FY2022

6,518

4,992

8,408

2,403

2,705

3,250

38

3.5

38

3.5

48

3.8

Main Training Contents

LEC e-Learning
Training

Can choose from more than 300 different topics, including Basic Skills, Legal &Compliance, Accounting & Finance, Finance, and Human Resources & Labor.

DAIWA REAL ESTATEACADEMYA

Practical training programs for acquiring basic real estate knowledge, realestate research and transactions

Daiwa Securities Skills
Training

Can choose from 30 courses including "Logical Thinking," "Design Thinking,""Business Succession," "Investment Analysis," etc.

※ Number of employees: Excluding temporary employees.
※ Number of employees, average length of service, number of managerial positions, and number of employees taking
childcare leave: Including those seconded to the parent company. Excludes employees 100% seconded to Daiwa Securities
Group companies such as Daiwa Securities Realty Co. Ltd.
※ Details of qualification support and training: Figures for FY2022 for each item include employees seconded to Daiwa
Securities Realty Co. Ltd.

Top Message/
Summary

Sustainability Report 2023

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

ESG Data (Governance Initiatives ①)

24

ESG Data

DOI

Status of Executive and Supervisory Directors/Criteria for Appointment

DLI

Directors are appointed by resolution of the General Meeting of Unitholders from candidates selected for the reasons given below on the condition that they do not fall under any grounds for disqualification or prohibition of
entrustment provided in the Investment Trusts Act or other laws and regulations (disqualification under Article 98 and Article 100 of the Investment Trusts Act, and Article 164 of the Regulation for Enforcement of the Investment
Trusts Act) or (prohibition of entrustment under Article 200 of the Investment Trusts Act and Article 244 of the Regulation for Enforcement of the Investment Trusts Act). Each board of directors is composed of persons who have novested interest in the respective investment corporation.

(DOI)

Title

Name

GenderReasons for appointment

Executive
Director

Keiichi Sakai

MaleElected as an Executive Officer based on his extensive business experienceand knowledge of finance in general, as well as his appropriate judgment,
personality, and insight in the execution of his duties.

Supervisory
Director

Daisuke Eki

Supervisory
Director

Koichiro Ito

Male

Male

Elected as a supervisory director based on his well versed in various laws
and regulations as an attorney and has sufficient character and insight tosupervise the execution of duties by the executive director and to perform
his duties as a member of the board of directors of the Fund.

Attendance at Board of
Directors meetings（Fiscal Period ended
May 2022）

Attendance at Board of
Directors meetings（Fiscal Period ended
November 2022）－

4 of 4（100.0%）

Number ofinvestment
units of theInvestment
Corporation
held

Skill

0

●
（Corporate
management）－

4 of 4（100.0%）0－Elected as a supervisory director based on his well versed in accounting
and taxation as a certified public accountant and has sufficient characterand insight to supervise the execution of the duties of the executive
director and to perform his duties as a member of the board of directors of
the fund.

－4 of 4（100.0%）

0●（Finance andaccounting）

Reasons for appointment

Attendance at Board of
Directors meetings（Fiscal Period ended
September 2022）

Number ofinvestment
units of theInvestment
Corporation
held

Skill

※Keiichi Sakai, Daisuke Eki and Koichiro Ito assumed office as of August 26, 2022.

(DLI)
Title

Executive
Director

Name

Yoshio Urata

Supervisory
Director

Akimitsu Takai

Supervisory
Director

ChizukoNakataGenderAttendance at Board of
Directors meetings（Fiscal Period ended
March 2023）

Male

Elected as an Executive Officer based on his extensive business experienceand knowledge of finance in general, as well as his appropriate judgment,
personality, and insight in the execution of his duties.

8 of 8（100.0%）3 of 6（50.0%）

0

Male

Elected as a supervisory director based on his well versed in various laws
and regulations as an attorney and has sufficient character and insight tosupervise the execution of duties by the executive director and to perform
his duties as a member of the board of directors of the Fund.

●（Corporate
management）（Finance andaccounting）（Risk
management）

8 of 8（100.0%）6 of 6（100.0%）0－

7 of 8（87.5%）

6 of 6（100.0%）

0●（Finance andaccounting）

FemaleElected as a supervisory director based on his well versed in accounting
and taxation as a certified public accountant and has sufficient characterand insight to supervise the execution of the duties of the executive director
and to perform his duties as a member of the board of directors of the fund.

※1 Please refer to the website of each investment corporation for the main biographies of each executive director and supervisory director. The term of office of executive directors and supervisory directors is stipulated as two years from their assumptionof office in the Articles of Incorporation.
※2 In accordance with the rules for the management of insider trading, etc., directors and executive officers of the investment corporation are not allowed to buy or sell investment units issued by the investment corporation.
※3 The number of investment units held is as of March 31, 2023.
※4 Each skill is circled in the MSCI Skills Matrix, where the expertise of each director's work experience is evaluated.

Top Message/
Summary

Sustainability Report 2023

Sustainability Policy/
Sustainability Promotion System

ESG Data (Governance Initiatives ②)
DOI's Articles of Incorporation stipulate that the maximum amount of remuneration for executive directors andsupervisory directors shall be 800,000 yen per month per person and 500,000 yen per month per person,
respectively, as determined by the Board of Directors. A resolution of the general meeting of unitholders is
required for any change.
Name

Concurrent positions

Seiya Miyamoto

－

Title

Executive
Director

Supervisory
Director

TakayukiHiraishi

Hiroshi Sakuma

Attorney at Spring Partners

Executive
Director

Keiichi Sakai－
Attorney at Ishii Law Office(Unit: thousand yen)

Total Compensation for

Koichiro Ito

Director

3,000－

Auditor of Jibannet Holdings

Director and Audit Committee Member of e-Seikatsu Co., Ltd.

DOI's Articles of Incorporation stipulate that the standard for payment of remuneration for the accounting
auditor of DOI shall be up to 20 million yen for each fiscal period subject to audit, an amount to be determinedby the Board of Directors. A resolution of the general meeting of unitholders is required to change the standard.

Compensation based on
auditing duties

Yoshio Urata－(Unit: thousand yen)

Total compensation（Fiscal Period ended
May 2022）

Total compensation（Fiscal Period ended
November 2022）

15,75015,750※ Please refer to the following relevant pages.(only Japanese Web Site) in the subject asset management report regarding theactual compensation paid to the directors and independent auditors of DOI and DLI for the most recent fiscal period(Refer to the relevant page of DOI: I. Asset Management Report>(2) Summary of Investment Corporation>(3). AssetManagement Report>(2) Overview of the Investment Corporation>(3) Matters Concerning Directors, etc.)(Refer to the relevant page of DLI: II. (Asset Management Report>Overview of the Investment Corporation>(3) Matters
Concerning Directors, etc.)

DLI(Unit: thousand yen)

Total Compensation for
Positionin This Period

3,000

Representative of Takai Law Office
Auditor of Japan Cycle Co., Ltd.

Outside Auditor of Take and Give Needs Co., Ltd.

Akimitsu Takai Outside Auditor of NEW ART HOLDINGS Co., Ltd.

Outside Director (Audit, etc., Committee Member) of Kojima Co.,

Supervisory

Ltd.

Director

3,000

Outside Director of Noda Corporation
Registered as a certified public accountant Representative of
Nakata CPA Firm

Chizuko Nakata Representative Director, Nakata Business Consulting LLC

Outside Director (Audit & Supervisory Committee Member)),
Nihon Nohyaku Co., LTD.

（Fiscal Period ended March 2023）
Name

Concurrent positions

Yoshio Urata－(Unit: thousand yen)

Total Compensation for
Positionin This Period

3,000

Representative of Takai Law Office

Auditor of Japan Cycle Co., Ltd.

Supervisory－

Accouting Auditor Compensation(DOI)

KPMG AZSA LLC

Concurrent positions

Akimitsu Takai－

Description of compensation

Director

Name

4,200

※ Effective August 26, 2022, Seiya Miyamoto resigned as Executive Director and Keiichi Sakai assumed the position.
Also, as of the same date, Supervisory Directors Takayuki Hiraishi and Daisuke Eki resigned as supervisory directors andKoichiro Ito were appointed as supervisory directors.

Name

Executive

Director

Director of ACT Holdings, Inc.

Hiroshi Sakuma

Title

Executive

Auditor of VISITS Technologies Inc.

Hiraishi（Fiscal Period ended September 2022）

Title

Representative of Ito International Accounting and Taxation

Auditor of moi Corporation
Takayuki

25

ESG Data

DLI's Articles of Incorporation stipulate that the maximum amount of remuneration for executive directors andsupervisory directors shall be 800,000 yen per month per person and 500,000 yen per month per person,
respectively, as determined by the Board of Directors. A resolution of the general meeting of unitholders is
required for any change.

Positionin This Period

OfficeSupervisory

Acquisition of External
Assessments/Certifications

Directors Compensation/Concurrent Positions (DLI)

4,200

CPA/tax accountant at Sakuma CPA Firm

Concurrent positions

Daisuke Eki

Positionin This Period

3,000

Name

Seiya Miyamoto

Total Compensation for

Audit & Supervisory Board Member at Delivery Consulting Inc.

（Fiscal Period ended November 2022）
Title(Unit: thousand yen)

Director at Just Planning Inc.

Sustainability
Finance

DOI

Directors Compensation/Concurrent Positions (DOI)（Fiscal Period ended May 2022）

GovernanceInitiatives

SocialInitiatives

Environmental
Initiatives

Outside Auditor of Take and Give Needs Co., Ltd.

Outside Auditor of NEW ART HOLDINGS Co., Ltd.

Outside Director (Audit, etc., Committee Member) of Kojima Co.,

Ltd.

3,000

Outside Director of Noda Corporation

Director

Registered as a certified public accountant Representative of

Nakata CPA Firm

Chizuko Nakata Representative Director, Nakata Business Consulting LLC

Outside Director (Audit & Supervisory Committee Member)),
Nihon Nohyaku Co., LTD.

※ Effective December 21, 2021, Ikuo Shoda and Shunichi Suzuki resigned as executive directors, and Yoshio Urata
assumed the position of director.In addition, Kohei Yabuta and Jun Nagamine resigned as supervisory directors,
and Akimitsu Takai and Chizuko Nakata were appointed as supervisory directors.

Accouting Auditor Compensation(DLI)

DLI's Articles of Incorporation stipulate that the standard for payment of remuneration for the accounting
auditor of DOI shall be up to 30 million yen for each fiscal period subject to audit, an amount to be
determined by the Board of Directors. A resolution of the general meeting of unitholders is required tochange the standard.
(Unit: thousand yen)
Name
Grant Thornton Taiyo LLC

Description of compensation
Compensation based on
auditing duties

Total compensation（Fiscal Period ended
September 2022）

Total compensation（Fiscal Period ended
March 2023）

15,00017,000Sustainability Report 2023

Top Message/
Summary

Sustainability Policy/
Sustainability Promotion System

Environmental
Initiatives

SocialInitiatives

GovernanceInitiatives

Sustainability
FinanceAcquisition of External
Assessments/Certifications

ESG Data (Governance Initiatives ③)

DOI

Compensation Structure of Each Investment Corporation(DOI)

classification

Management Fee Ⅰ(based on assets under management)
Management Fee Ⅱ(rent revenue standard)Management Fee Ⅲ(based on distributable amount)
Management Fee Ⅳ(asset acquisition standard)Management Fee Ⅴ(asset sale standard)(DLI)

classification

Total appraisal value of assets undermanagement(based on market value)

0.05%
5.5%

Distributable amount

3.5%

Acquisition price of target real estate

0.75%

Transfer price of target real estate

0.5%

Basis of the calculation

Total asset value

Acquisition Fee

Acquisition priceTransfer Fee

Transfer price(As of November 30, 2022)

Fee rate

0.2%（annual）
8.0%

Income before tax【Rental housing】1.0%【Healthcare】1.5%
0.5%

Succeeded asset value

Merger Fee

Fee rate

Rent revenue

Management Fee1
Management Fee2

Investment Corporation Management Structure

Basis of the calculation

1.0%

Same-boat investment in each investment corporation by the sponsor(As of March 31, 2023)

Each Investment Corporation aims to increase unitholder value by aligning the interests of unitholders of each investment
corporation with the interests of the sponsor, Daiwa Securities Group.
(DOI)

Sponsor group

Number of units

Holding ratio

Daiwa Securities group Inc.

67,321units

14.08%

Daiwa Investment Management Inc.

(DLI)

128,905units

26.95%(As of November 30, 2022)

Sponsor group

Number of units

Holding ratio

Daiwa Securities group Inc.

346,915units

15.73%

Good Time Living Co.Ltd.

10,853units

0.49%(As of March 31, 2023)

Status of response to political contribution risk, bribery, and anti-corruption
classification

Total amount of political donations

No. of cases of exposure related to fraud andcorruption

No. of cases of punishment/dismissal related to
fraud and corruption

Reconciliation cost of penalties/punishment
related to fraud and corruption

FY2020

FY2021

FY2022

0

0

0

0

0

0

0

0

0

0

0

26

ESG Data

0

DLIDR