Fuyo Lease Sustainability Website

2021
ArchiveTop> Sustainability

Sustainability

Fuyo Lease Group's
CSV

Solving Social
Issues throughBusiness

Environmental
ReportSocial Report

Governance andManagemnet

Each Group
Company's
Environmental andSocial initiatives

1

Fund procurement
through ESG
ﬁnanceParticipation in
Initiatives andThird-Party
Evaluation"Integrated Report"PDF
download"Integrated Report 2021"（4761KB）

Other years' reports are here

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Contents

Sustainability
Fuyo Lease Group's CSV

P4Solving Social Issues through Business

P27

Environmental Report

P52

Social Report

P81

Governance and Management

P136

Each Group Company's Environmental and Social initiatives

P173

Fund procurement through ESG finance

P202

Participation in Initiatives and Third-Party Evaluation

P218

Editorial Policy

P222

Independent assurance

P224"Integrated Report" PDF download

P226

3

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> Sustainability> Fuyo Lease Group's CSV

Fuyo Lease Group's CSV

Message from the
President

Our Thoughts on CSVManagement Philosophy

Materiality

Sustainability

Fuyo Lease
Group's CSV

Message fromthe President

Fuyo Lease Group and
Its Stakeholders

Management
Philosophy
Our Thoughts
on CSV
Materiality
Fuyo Lease
Group and Its
Stakeholders

Solving Social
Issues throughBusiness
Environmental
ReportSocial Report
Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

4

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

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> Sustainability> Fuyo Lease Group's CSV> Message from the President

Message from the President

Expanding our areas of business, both in and outside
Japan, through management founded on CSVWorking toward sustainable growth by achieving bothsocial and corporate value

Sustainability

Fuyo Lease
Group's CSV

Message fromthe PresidentManagement
Philosophy
Our Thoughts
on CSV
Materiality
Fuyo Lease
Group and Its
Stakeholders

Yasunori Tsujita President & Chief Executive Officer

Review of the Medium-Term Management
Plan
This year marks the fifth and final year of the Fuyo Lease Group's five-year Medium-term Management
Plan, Frontier Expansion 2021.
During this Medium-term Management Plan, I have managed the Group with a strong desire to

Solving Social
Issues throughBusiness
Environmental
ReportSocial Report
Governance andManagement

demonstrate that sustainable growth is possible, even in the lease industry, generally considered abusiness that is stable at a low position. To that end, we are clearly aware of non-finance leasing—shifting our focus from traditional finance leases to operating leases—and are moving forward with nonfinancial initiatives typified by the renewable energy power generation business and business process
outsourcing (BPO), positioning them as Strategic Areas. The fact that we have continued to grow by
about 10% annually over the past several years, indicates, I think, that the Group's management
strategy demonstrates a business model for enabling sustainable growth.

6

Each Group
Company's
Environmental
and Social
initiatives

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Supporting this growth has been the management of our business portfolio, based on a zone
management approach (see diagram below) under which we have divided our business areas into fourzones to advance selection and concentration.
Conventional lease and finance businesses are positioned as core areas in the Performance Zone where
they generate stable earnings. Real Estate, Medical & Welfare, Energy & Environment and other fields
are positioned as Strategic Areas in the Transformation Zone,where we have concentrated management
resources to expand the business. We have grown steadily in these Strategic Areas over the past four
years, while in our core areas, we have succeeded in greatly improving yields through a combination of
portfolio restructuring and thorough cost reductions. In the area of New Domains, I believe we havemade beneficial investments in venture companies that we can expect will play a part in growth going
forward.
These efforts have led to real results, allowing us to reach ¥2,555.9 billion in operating assets, achieving
our target ahead of schedule, while significantly growing ordinary profit from ¥31.4 billion at the start ofthe plan to ¥48.0 billion.

7

Thorough Discussion of Goals for CSV
Maintaining and further enhancing this growth in preparation for the next Medium-term Management
Plan will be a major issue going forward. While I believe our Group corporate slogan, “Go where no one
has gone before,” has been the driver of our growth to date, that is not to say we can simply aim to go
anywhere. I have always believed that some philosophy is essential to choosing our direction. Moreover,as SDGs, ESG and other societal demands and issues have increased their presence in the public eye, I
believe it's imperative that employees share our approach and we communicate it to all of our
stakeholders in a manner that's easy to understand.
ESG strongly represents the perspective of society and stakeholders, while the SDGs alone, I feel, lackview from business potential. The Group has thus positioned CSV as the link between these two, and webelieve it is important to build a system—human resources, organizations, and governance—that cancontinually generate both corporate value (profit) and social value (solutions to problems). In themedium to long term, this will lead to our becoming “part of a system that aims for a better society.”
I believe that a company contributes to its stakeholders by growing sustainably and continuing to solve
issues with the goal of achieving a better society. We will continue working to respond to the
expectations of our clients, business partners, employees and investors.

8Enhancing the Human Resources andOrganizations that Support the Practice of
CSV
The ultimate means of continually generating value to is to build these approaches into the very
foundation of management itself. While the Group's business domains have gradually expanded, if weare to discuss future areas of expansion it is essential that each employee has a solid understanding ofwhat CSV means for the Group. This is why training and workshops were held for all employees in fiscal
2020. In October 2020, we also established a CSV Promotion Committee to serve as the organization
responsible for establishing and promoting strategies and policies involving the Group's approach tosustainability. Going forward, management will take responsibility for advancing non-financial targets
just as they do financial targets.
The Board of Directors is also active in discussing the Group's value creation, and plans to exchange
opinions from a variety of perspectives in formulating the next Medium-term Management Plan.

Contributing to Solving Social Issues throughBusiness
The Group is concentrating management resources in businesses that aim to solve social issues,
including climate change, enhancing medicine and welfare and improving corporate productivity.
In addressing climate change, companies are being called on to reduce greenhouse gases. While theGroup has participated in RE100 and set forth a goal of converting 100% of the electric power used inits business activities to renewable energy by 2050, we recently decided to move that target date up to2030. In addition to our shift to renewable energy to power our businesses, we are also working to9reduce CO2 overall with the goal of simultaneously achieving carbon neutrality on a Group-wide basis.
In services to customers, we have seen steady growth in sales of our Green Electricity Supply Services(PPA Services*1), launched in anticipation of corporate moves toward decarbonization. In addition to onsite PPA*2, we also expect an increase in off-site PPA*3 going forward. Our Fuyo Zero-Carbon City
Support Program, which we began offering in October 2020, has seen the number of users reach morethan 100 in just about six months, an indication of just how high customer needs are in the shift todecarbonization.
Meanwhile, we are also actively expanding our Energy & Environment business overseas. In Asia, in
addition to investing in a solar power generation fund in Taiwan, we also launched an energy solutions
company in Thailand with Sharp Corporation. We also joined with ENEOS Corporation to participate in asolar power generation business in Texas, U.S.
Efforts toward the circular economy*4 are similarly essential to building a sustainable world. While theGroup has long promoted the 3Rs*5, we took initiatives to the next level by becoming the first financial
institution in Japan to join the Ellen MacArthur Foundation, an international organization promoting theidea of the circular economy. We have already begun exchanging information with other members, andare engaged in concrete discussions with several companies with a view toward collaboration. I sense
enormous potential here for lease companies like ours to serve as a central node in the circular
economy, connecting companies acting as “arteries” in producing and selling products with those acting
as “veins” in recycling and reusing those products.
In the Medical & Welfare business, given the growing need for non-in-person, contactless services
during the COVID-19 pandemic, we established Medicare in, a dedicated website allowing users to sign
up online for FPS Medical, an early payment service for medical and nursing care receivables that assists
medical institutions with managing cash flow. To further enhance convenience, we also plan to develop
a shared platform that can provide a centralized source for medical equipment and services offered by
our Group companies.
Our BPO business, which assists in improving corporate productivity, now represents more than 10% of
overall profits, and continues to grow into a pillar of the Group. After the COVID-19 pandemic,
companies are expected to accelerate their efforts to streamline operations and reform how they work,
and we will be working to strengthen timely proposals for utilizing RPA*6 and offering a single set of
efficiencies from upstream to downstream.

Working to Achieve Sustainable Corporate
GrowthResults for fiscal 2020 saw net sales reach ¥740.3 billion (up 3.9% year on year) with ordinary profit of¥48.0 billion (up 9.0% year on year), and our dividend increased by ¥35 year over year to ¥240, for apayout ratio of 24.3%. For fiscal 2021, we expect a ¥20 increase in the dividend, to ¥260, and a payout
ratio of 25.2%.
We were largely unaffected by the drastic changes in conditions brought about by the COVID-19
pandemic, and succeeded in delivering solid results. With these kinds of previously unimaginable eventsoccurring each year, I believe it will no longer be possible for management to respond as we have in thepast by simply advancing straight into the future. We recognize the importance of continuing to
implement our cycle of developing, enacting and verifying hypotheses, revising them when necessary.
We will continue our sustainable growth, while at the same time offering value to achieve a better
society. We hope you will look forward to our future contributions.

10

*1

Green Electricity Supply Services (PPA Services): A business installing solar power systems on
rooftops at customer facilities and elsewhere to supply energy directly to them.

*2

On-site PPA: In an on-site corporate PPA, the power producer installs, operates and maintains
power generation equipment to supply power produced on-site to the customer.

*3

Off-site PPA: In an off-site corporate PPA, a renewable energy generating facility is built outside ofa company's premises, and electrical power is supplied through a transmission network.

*4

Circular economy: An economic system that treats “waste” products and resources not utilized in
the linear take-make-waste economy as new “resources,” circulating those resources without
generating waste.

*5

3Rs: Reduce (the amount of waste generated), reuse and recycle.

*6

RPA: Acronym for robotic process automation. This process uses robots to handle routine
computer tasks normally carried out by people.

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> Sustainability> Fuyo Lease Group's CSV> Management Philosophy

Management Philosophy

We support corporate activities through our leasing
business with view to contributing to development of
the society.
We maintain customer's first philosophy, providing
best services.
We aim to earn high marks from shareholders andmarkets while pursuing creativity and innovation.
We create a challenging and rewarding workplace
where employees think and act on their own.

Sustainability

Fuyo Lease
Group's CSV

Message fromthe PresidentManagement
Philosophy
Our Thoughts
on CSV
Materiality
Fuyo Lease
Group and Its
Stakeholders

Solving Social
Issues throughBusiness
Environmental
ReportSocial Report
Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

12

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

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> Sustainability> Fuyo Lease Group's CSV> Our Thoughts on CSV

Our Thoughts on CSV

Practicing management based on CSV

Sustainability

The Fuyo Lease Group focuses on the concept of Creating Shared Value (CSV): achieving the sustainablegrowth of the Company by solving social issues. In practicing CSV, we believe it is important to deliver
both corporate value (corporate profits) and social value (solving issues), and to build structures (forhuman resources, organization, and governance) that will support the sustainable generation of both

Fuyo Lease
Group's CSV

values. We are engaged in a range of initiatives aligned with these priorities.

Message fromthe PresidentManagement
Philosophy
Our Thoughts
on CSV
Materiality
Fuyo Lease
Group and Its
Stakeholders

Solving Social
Issues throughBusiness
Environmental
ReportSocial Report

We have identiﬁed important issues to be addressed that will form the main themes of our activities as
our “materiality,” taking into consideration the Sustainable Development Goals (SDGs) proposed as a setof common global goals for solving social issues, and the United Nations Global Compact (UNGC). We
will strive to achieve our KPIs while actively disclosing information to encourage our stakeholders'
understanding and cooperation as we accelerate our activities.
In addition to its expertise in ﬁnance cultivated in the lease business, the group will also utilize its
strengths in a wide range of ﬁelds, including the Medical & Welfare, Energy & Environment, Business
Process Outsourcing (BPO) and the Mobility Business. By combining these strengths, the Group will work
as one, aiming to solve social issues through its businesses.

14

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

CSV Promotion System
In October 2020, the Group established a CSV Promotion Committee to promote the Group's CSV andsustainability efforts. The CSV Promotion Committee will formulate CSV and non-financial targets andplans, and will conduct monitoring related to progress in those areas. Matters discussed by and reported
to the Committee will be submitted to the Executive Committee, and upon approval will be reflected in
the Group's strategy. The Group's overall policy involving CSV and promotion status, will be reported to
the Board of Directors at least once a year in an effort to enhance their effectiveness.

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Instilling Understanding among Employees
In order to conduct corporate activities centered around CSV over the long term, it is essential that all
employees understand the kind of value creation the Group is working toward. To this end, in fiscal 2020
we held a series of CSV training programs (“Let's CSV!”) for all Fuyo Lease employees. This three-partseries began with an e-learning program for all employees, then continued with workshops conductedby outside instructors for management-level employees (directors and heads of departments, offices
and branch offices), and finally workshops for all employees with heads of departments, offices andbranch offices acting as instructors. We discussed the connection between our work and society, andmethods of increasing social value. We plan to expand this training across the Group as a whole in fiscal
2021 and beyond.

Workshops for management-level employees

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Workshops for all employees

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> Sustainability> Fuyo Lease Group's CSV> Materiality

Materiality

In order to realize a sustainable society, the Fuyo Lease Group has identified issues to be solved throughthe Group's businesses as Material Issues (important issues to be addressed), taking into consideration

Sustainability

their impacts on society and stakeholders with reference to the SDGs proposed by the United Nations.
We will contribute to creating a prosperous and sustainable society by enhancing shared values between
society and companies through our efforts along with identified Materiality.

Message fromthe President

Identifying Materiality
STEP 1

Fuyo Lease
Group's CSVManagement
Philosophy

Identifying issues

Based on the SDGs and ESG indexes, we identify issues which could influence our Group.

Our Thoughts
on CSV
Materiality
Fuyo Lease
Group and Its
Stakeholders

STEP 2

Assessing Materiality from the Stakeholders' Point of View

We assessed materiality of the issues identified in Step 1 from the viewpoint of investors andother stakeholders.

Solving Social
Issues throughBusiness
Environmental
ReportSTEP 3

Assessing Materiality for our Business Operations

We assessed materiality of the issues identified in Step 1 considering our business based on
our Medium-term Management Plan, Code of Corporate Conduct and other guidelines.

Social Report
Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

STEP 4

Identifying Priority Issues

Following Steps 2 and 3, we identiﬁed priority issues. Top management approved theidentiﬁed priority issues following a discussion by the Board of Directors.

16

Materiality for Fuyo Lease Group
Following the Materiality identification process shown above, we identified Goal 3, 5, 7, 8, 11, 12, and13 as the most important strategic goals.

Fundprocurement
through ESG
finance
Participation in
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Evaluation
Editorial Policy
Independent
assurance

Materiality (Material Issues)
1.

Responding to climate change issues and renewable energy

2.

Contributing to the creation of a circular society

3.

Promoting health and wellbeing

4.

Developing safe and livable cities and providing transportation

5.

Achieving economic growth and fulfilling work

6.

Diversity and work-style reform

KPIs and Targets of Materiality (Creation of
Shared Value through Business Activities)
Social Value (Environment)
1.Responding to climate change issues and renewable energy
CSV1:Energy & Environment

17

Themes of Initiatives &KPIs

Expandsupply ofSupplyinggreen

renewableenergyenergythrough theResults and plan
(output)

FY
2020
Results

283MW‐
dc*1

Targets

Contributing
to society
and theenvironment(outcome)

200MW-dc(Achieved)

Estimated
CO₂reduction
147,574 t-CO₂[FY2020]

renewableenergypower
generation
business(powergeneration
capacity)

ConvertSetting

power
consumedby the Fuyo
Lease Groupinto
renewableenergytargets andpromotingthe use ofrenewableenergy inbusiness
operations

Providesupport for
the wideruse ofrenewableenergythrough theprovision offinancialservices

Transaction
volumeunder the“Fuyo 100%
Renewable
Electricity

1%

¥2.64
billionPromoting the2024
target: 50%
2030
target:use ofrenewableenergy and100%

communicating
demand voices
to the market

2024
target: ¥5.0
billionNumber ofcompanies andorganizations
using theprograms: 114(October

Declaration
Support
Program”

2019-March
2021)

and the“Fuyo Zero
Carbon City
Support
Program”

Operating

Promotecuttingedge
renewableenergyrelated
technologies¥85.0¥41.0 billion

Promoting(Achieved)

renewableenergy andenergy saving

Capitalandbusiness

Supportsales of newtechnologies

Disseminating
advancedrenewableenergyrelated
technology

alliance
with
Tsubameandproducts
andenergy-related
technologies

venturecompanies

BHB Co.,Ltd.

provision ofnewservices

assets of theEnergy &Environment
businesses

billion*2

Oﬀering
support torenewable

18

Relevant
Business
and SDGs

Energy &Environment

2.Contributing to the creation of a circular society
CSV2:Circular Economy

Results and plan
(output)
Themes of Initiatives &KPIs

FY 2020
Results

FY
2021
Targets

PC: 100%
Other than

PC:
100%

Reducing
waste and

Other

promoting a

than
PC:

circular society

Reductionand proper

Reuse andrecycledisposal ofwastethrough therate forreturnedPC

PC: 93%

Ensureproperdisposal ofwaste

Proper disposal of all
waste (zero violations ofenvironmental laws, etc.)

3Rs(reduce,reuse, andrecycle) for
leasedassetsContributing
to society
and theenvironment(outcome)

95%

Reducing ourenvironmental
impact byensuring
properdisposal of
waste

19

Relevant
SDGs

Social Value (Society and People)
3.Promoting health and wellbeing
CSV5:Medical & Welfare

FY 2020
Results

FY 2021
Targets

Contributing
to society
and theenvironment(outcome)¥95.1 billion¥95.0 billion(Achieved)

Improving
both quantity

Results and plan (output)
Themes of Initiatives &KPIs

Expandaccess ofOperatingassets of

medical,elderly
nursing care,

Medical &Welfarebusinesses

and quality of
medical,elderly nursing

and welfare
servicescare, andwelfareservices

SupportBalance of

medicalinstitutions
with their
management

factoringfor medical
andnursing
care
receivables(balanceof FPS
Medical by
Accretive)

Promotecutting-edge
healthcaretechnologies¥20.3 billion¥30.0 billion

Helping
medicalinstitutions toachievefinancialstability bymeeting theirfunding needs

Offering
support to

Capital andbusiness

Supportsales of new

Disseminating
advanced

medicalventurecompanies

alliances
with
THINKCYTE,

technologies
andproducts

medicaltechnologies

Inc. and CB
Holdings,
Inc.

andprovision ofnewservices

20

Relevant
Businessand
SDGs

Medical &Welfare4.Developing safe and livable cities and providing transportation

Results and plan
(output)
Themes of Initiatives & KPIs

FY
2020
Results

FY 2021
Targets

Contributing
to society
and theenvironment(outcome)

PromoteOperating¥555.2¥530.0

Supplyingenvironmentallyand sociallyfriendly urban

assets ofreal estateleasesbillionbillion(Achieved)

environmentallyand sociallyfriendly assets

scape and
residential
space(Commercial
facilities,
hotels,Relevant
Business
and
SDGs

Real
EstateAircraftdistribution
facilities,
nursing carefacilities,
residential
facilities,
etc.)

Contribute toexpanding thevolume of safe,
inexpensive,and fasttransportation

Number of
aircraftowned bythe Group44
aircraft-*3

Transportation
capacity: 11
million people*4
per year [FY2020]

5.Achieving economic growth and fulfilling work
CSV3:BPO

Themes of Initiatives &KPIs

Improvemanagement
efficiency,
overcomelaborshortage,
and address
work-stylereformNumber ofcompanies

Results and plan
(output)
FY 2020
Results

FY 2021
Targets

Contributing
to society
and theenvironment(outcome)

19,35320,000Contributing

companies

companies

to theresolution oflabor
shortages andprovided
BPO
services by
five BPO
companies*5

the promotionof work-stylereform byproviding BPO
services

21

Relevant
Business
and
SDGs

BPO

System that Support Sustainable Value Creation
6.Diversity and work-style reform
Results and plan
(output)
Themes of Initiatives &
KPIs

FY
2020
Results

FY 2021
Targets

Empower

Percentage ofwomen inworkplaces

femaleemployees inandmanagement

realize theirdevelophuman
resources

positions (nonconsolidated

full potential in
the workplacewithdiverse

Percentage of

25.1%

Contributing
to society
and theenvironment(outcome)

52.6％

30% orEnsuring thatmore

femaleemployees can

40% orstrengths

new female
employees
hired (nonconsolidated)

more

Improvework-style
to pursue
efficiency
andproductivity

Rate of taking
annual paid
leave (nonconsolidated)

72.0%

Promotework-life
balance

Telecommuting
utilization
rate*676.7%

40% ormore

Promoting abalancebetween workand family

Improvejob
satisfaction

Rate of job
satisfaction*7(consolidated)

85.4%

Steadyimprovement

Increasing
productivity
and added

80% ormore

Improvingwork-style topursueefficiency andproductivity

value byenhancing job
satisfaction

22

Relevant
SDGs

*1

The calculation method for power generation capacity was changed from ﬁscal 2020 to include*2

The calculation method for operating assets was changed from ﬁscal 2020 to include therenewable energy generation business.

*3

investment projects (calculated in proportion to investment share).

The target has been withdrawn due to the impact of the COVID-19 pandemic in ﬁscal 2020
(original target: 70 aircraft 〈ﬁscal 2021〉)*4

Calculated using the method employed prior to the spread of COVID-19*5

Sharp Finance, Accretive, INVOICE, NOC Outsourcing & Consulting, and MerryBiz.

*6

Percentage of employees who have been provided with home PCs to establish telecommuting
environments and have telecommuted from home at least once

*7

Percentage of employees who rated 4 or above (on a scale of 1 to 5) for at least one job
satisfaction question out of 6 in the Employee Satisfaction Survey

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> Sustainability> Fuyo Lease Group's CSV> Fuyo Lease Group and Its Stakeholders

Fuyo Lease Group and Its Stakeholders

The Fuyo Lease Group aims to solve social issues through its business operations as it paves the way toa sustainable society and sustainable business growth, while responding to the expectations of its

Sustainability

stakeholders.

Fuyo Lease
Group's CSV

Stakeholder Dialogue
We believe that communicating with stakeholders is the key to accurately understanding various social
issues and the role we are expected to play. We see communication as the bridge that brings us closer
to stakeholders, and we use it to ensure that we live in harmony with people from all walks of life.

Message fromthe PresidentManagement
Philosophy
Our Thoughts
on CSV
Materiality
Fuyo Lease
Group and Its
Stakeholders

Solving Social
Issues throughBusiness
Environmental
ReportSocial Report
Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

24

Customers

Our management philosophy is “we maintain customers first
philosophy, providing the best services.” In putting that philosophy
into practice, we work to enhance the level of satisfaction of all ourcustomers.

Suppliers andpartners

Shareholders

We work together with suppliers, business partners, and vendors
fertile ground upon which everyone involved can grow.

Participation in
Initiatives andThird-Party
Evaluation

Our basic policy is to return stable profits to shareholders on along-term basis. We also disclose information in a timely,
appropriate, and fair manner to ensure the transparency of our

Editorial Policy

to build and maintain fair and equal relationships that serve as

operations.

Industryorganizations andcompetitors

Communities andNPO

Natural environment

Independent
assurance

We work with competitors to enhance business, improve services,and share information through, for example, participation inindustry associations.

We value communication with people, companies, NGO/NPO andother organizations not only in the areas where we operate but
also with a host of communities that lie beyond, and engage incommunity-based activities as a responsible corporate citizen.

To address environmental issues, we actively implement
environmental initiatives through our business activities and strive
to minimize our environmental footprint.

National government,
administrative
authorities, etc.

Fundprocurement
through ESG
finance

We maintain appropriate relationships with the government ofJapan, relevant ministries and agencies, and local governments.
We also maintain sound relationships with the governments andadministrative authorities of countries where our overseas
subsidiaries operate.

Financial institutions

We raise funds necessary for our operations by maintaining strong
relationships of trust with financial institutions.

Employees and theirfamilies

We strive to create a comfortable and secure workplaceenvironment and are working towards an environment where all
employees can find their own optimal work-life balance andenhance the quality of both life and work.

Participation in the United Nations Global Compact(UNGC)The UNGC is an initiative in which companies and organizations demonstrate responsible and creative
leadership to act as good members of society and participate in the creation of a global framework forthe realization of sustainable growth. Fuyo Lease signed the UNGC in January 2018. We agree to andcontinue to work toward the achievement of the UNGC's Ten Principles* related to protecting humanrights, eliminating unfair labor, responding to environmental issues and anticorruption.
The Global Compact Network Japan, which is the local network of the UNGC, hosts subcommitteesorganized by theme to discuss and exchange information with experts regarding the efforts of member

25companies and organizations. Since fiscal 2019, we have participated in several subcommittees, and use
the knowledge and best practices we have gained from these subcommittees to promote sustainablebusiness activities.

*

The Ten Principles of the UNGC

Principle 1: Businesses should support and respect the protectionof internationally proclaimed human rights; andHuman Rights
Principle 2: make sure that they are not complicit in human rights
abuses.

Principle 3: Businesses should uphold the freedom of associationand the effective recognition of the right to collective bargaining;

LabourPrinciple 4: the elimination of all forms of forced and compulsory
labour;Principle 5: the effective abolition of child labour; andPrinciple 6: the elimination of discrimination in respect of
employment and occupation.

Principle 7: Businesses should support a precautionary approachto environmental challenges;

Environment

Principle 8: undertake initiatives to promote greater environmental
responsibility; andPrinciple 9: encourage the development and diffusion ofenvironmentally friendly technologies.

Anti-Corruption

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Principle 10: Businesses should work against corruption in all its
forms, including extortion and bribery.

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> Sustainability> Solving Social Issues through Business

Solving Social Issues through Business

CSV1:Energy &Environment

CSV2:Circular Economy

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

CSV3:BPO

CSV4:Mobility Business

CSV1:Energy&
Environment
CSV2:Circular
EconomyCSV3:BPO
CSV4:Mobility
Business

CSV5:Medical & Welfare

CSV5:Medical& Welfare

Environmental
ReportSocial Report

Environmentally conscious products andservices27

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

Through leasing and financing, we support capital investments for achieving energy-savings. Fuyo Leasebusinesses that promote energy conservation and renewable energy.

Fundprocurement
through ESG
financeGreen Electricity Supply Services (PPA: Power Purchase
Agreement)

Participation in
Initiatives andThird-Party
Evaluation

has extensive unique backup systems, including systems that use various subsidy systems and supplierreferrals. We contribute to mitigating the impact of climate change by developing a wide range ofThis service supplies CO₂ free, green electricity by installing solar power generation systems andEditorial Policy

operating and managing them over a contracted period.
Click here for details

Independent
assurance

Energy-saving equipment and subsidy-based leases
We offer energy-saving measures using leases.
Click here for details

ESCO (Energy Service Company) service
As an ESCO operator, we support total energy-saving activities.
Click here for details

Fuyo 100% Renewable Energy Declaration Support Program
We provide the financing program for companies and organizations participating in RE100 and the"100% Renewable Energy Declaration RE Action".
Click here for details

Fuyo Zero-Carbon City Support ProgramThis is a finance program that supports the installation of renewable energy and energy-saving facilities
in areas promoted as “Zero-Carbon Cities” by the Ministry of the Environment.
Click here for details

Financing for renewable energy companies
We provide various financing services in the renewable energy field.
Click here for details

Solar loan
We offer loans covering purchasing and installation costs of solar power generation systems.
Click here for details

28Renewable energy generation business
The Group is involved in operation of solar power plants, and participates in renewable energy projects
in Japan and overseas.
Click here for details

Agri BusinessWe provide finance services that reduce the initial investment burden for businesses responsible fornext-generation agriculture. We also operate one of the largest plant factories in Japan.
Click here for details

Products and services that contribute tosolutions for challenges in the Medical &Welfare fields

We are building a one-stop service system that provides a wide range of solutions for medical
institutions and elderly nursing-care providers facing various issues against the background of thedeclining birthrate, aging population, and the concept of the Regional Medical Care Vision. In
collaboration with group companies, we will further expand our products and services and respond
appropriately to changing client's needs.

Clinic launch support loan
We provide finance services that quickly provides funds for opening a clinic.
Click here for details

FPS Medical (a factoring service for medical and nursing-carereceivables)
We provide asset utilization type finance services to medical institutions, elderly nursing-care providers,and dispensing pharmacies.
Click here for details

Products and services that contribute toeconomic growth and work-style reform29

We are conducting business development centered on BPO services to resolve issues arising from there
being "not enough people or not enough time” and to improve productivity for companies. By providing
a variety of services that meet clients' needs, we will achieve economic growth for companies and help
to both resolve the severe labor shortage caused by a decline in the labor force and promote initiatives
for work-style reform.

BPO Services
We provide BPO (Business Process Outsourcing) services to support business efficiency.
Click here for details

Products and services that contribute tosolutions for challenges in the logistics
mobility field

We provide various services related to the logistics mobility field such as logistics, vehicles, andwarehouses with group companies and affiliated companies. By leveraging our strengths in high-quality
solutions that utilize our extensive domestic and overseas network, we support solutions to various
issues in the vehicle and logistics industry.

Building Leases
We handle building leases for warehouses and distribution centers.
Click here for details

Auto Leases
We provide total vehicle services that include vehicle procurement, tax, and insurance payments, vehicle
maintenance and inspections, and vehicle disposal at lease end.
Click here for details

Vehicle maintenance consignment businessThis service manages maintenance exclusively for heavy-duty vehicles.
Click here for details

Products and services that contribute to thecreation of a circular society30In order to promote the 3Rs (Reduce, Reuse, and Recycle), we provide economic advantages to ourcustomers and contribute to the establishment of a closed-loop society not only by reusing PCs whose
leases have expired but also by purchasing used assets owned by customers.

PC Lifecycle Management (PC-LCM) Service
We conduct comprehensive services related to general PC operations.
Click here for details

PC Eco & Value lease
We offer leases for personal computers in the pursuit of economic and ecological benefits.
Click here for details

Personal computer rental
We offer a rental system that flexibly responds to technological innovations in rapidly changing personal
computers.
Click here for details

Used personal computer purchasing service
We purchase used personal computers.
Click here for details

Used assets purchasing service
We purchase redundant equipment and idle assets.
Click here for details

For a comprehensive list of products and services of Fuyo Lease Group, please click here.

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> Sustainability> Solving Social Issues through Business> CSV1:Energy & Environment

CSV1:Energy & Environment

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

CSV1:Energy&
Environment

The Fuyo Lease Group's Initiatives to Address
Climate Change Issues
Since the 2015 adoption of the Paris Agreement, initiatives toward decarbonization have advanced
worldwide, and in October 2020, Japan clearly set forth a policy of achieving virtually zero CO2emissions by 2050. Measures to address climate change will likely accelerate further going forward.

CSV2:Circular
EconomyCSV3:BPO
CSV4:Mobility
Business
CSV5:Medical& Welfare

The Fuyo Lease Group believes that we must start by taking the initiative to reduce greenhouse gases
ourselves, and in 2018, we became the ﬁrst Japanese comprehensive leasing company to join RE100,
an international initiative that aims to convert all electricity consumed in business activities to renewable

Environmental
Reportenergy. Since participating in RE100, the Group has set a target of 100% renewable energy use by 2050
and 50% by 2030, but we have now decided to work to achieve RE100 by 2030 and carbon neutrality

Social Reportby 2030 as well.
Because we have been tenants at most of our sites to date, our inability to negotiate directly withelectric power companies themselves has been a major barrier to achieving the goal of renewableenergy. At our head oﬃce, we worked with Sumitomo Realty & Development Co., Ltd., the building's
owner, to create a new scheme allowing tenant companies to also make use of renewable energy. In
April 2021, electricity used by the Group in the building switched to renewable energy, as we work toadvance eﬀorts to increase the percentage of renewable energy use.
In 2019, we also endorsed the Task Force on Climate-related Financial Disclosures' (TCFD)
recommendations, and we are preparing to analyze the ﬁnancial impact of climate change on the Groupand disclose that information.

32

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

Toward the Achievement of Decarbonizationfor Society and Our Customers
We believe that contributing to the decarbonization of society as a whole through our business is an
important issue for the Group, which engages in a wide range of business fields and has a broadcustomer base, and we are actively promoting initiatives based on the three pillars: “Renewable Energy
Generation Business,” “Promoting Renewable Energy-Related Infrastructure,” and “Investment in andCommercialization Support for Renewable Energy-Related Technologies.”

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

1. Renewable Energy Generation BusinessWe launched our renewable energy power generation business in 2012, and now supply renewableenergy to communities equivalent to the annual power consumption of approximately 85,000
households. Additionally, in fiscal 2020 our participation in wind power generation projects in Japan andrenewable energy power generation projects in the U.S. and Taiwan increased the Group's power
generation capacity, including equity participation, to 283 MW-dc. Going forward, we will continue toexpand the business through joint development with alliance partners, overseas expansion through joint
investments, and through acquisition of solar secondary projects.*1

2. Promoting Renewable Energy-Related Infrastructure
We offer two programs that provide financial support to companies and organizations working toward
decarbonization: the Fuyo 100% Renewable Electricity Declaration Support Program, and the Fuyo Zero
Carbon City Support Program. The Fuyo 100% Renewable Electricity Declaration Support Program,begun in 2019, is a preferential financing program for businesses and organizations that have joined
RE100 and the 100% Renewable Electricity Declaration RE Action.*2 Using funds raised by the Company
through green bonds, the program is aimed at encouraging the introduction of renewable energy
facilities and energy-efficient equipment.
In addition, the Fuyo Zero Carbon City Support Program, newly launched in 2020, is a donation-built-in
program open to all companies, organizations and local governments. Along with customers who install
facilities and equipment that contribute to decarbonization in areas of municipalities that have declaredthemselves zero-carbon cities*3, the program donates an amount equivalent to 0.2%*4 of the value oflease contracts to organizations that contribute to promoting zero-carbon cities. The program is being
promoted not only in the Tokyo metropolitan region, but throughout Japan in cooperation with many
regional ﬁnancial institutions, and more than 100 customer companies have applied for the program in
the ﬁrst six months since its launch.

33

3. Investment in and Commercialization Support for Renewable
Energy-Related Technologies
The Fuyo Lease Group actively invests in and forms business alliances with venture companies that haveadvanced renewable energy-related technology, and supports their commercialization. In fiscal 2018, weformed capital and business alliances with Exergy Power Systems Inc., which develops andmanufactures next-generation energy storage systems, and with NExT-e Solutions Inc., which provides
battery management systems that utilize advanced battery control technologies. In fiscal 2019, we
entered into a capital and business alliance with Girasol Energy Inc., which is developing an IoT platform
for the maintenance and management of solar power facilities.
Further, in fiscal 2020, we closed a capital and business agreement with Tsubame BHB Co., Ltd., which
is working to develop and commercialize the world's first on-site ammonia production system. In recent
years, ammonia has gained attention as a nextgeneration energy source that does not emit CO2 when
combusted, and as an energy carrier*5 that facilitates the transport and storage of hydrogen. The Fuyo
Lease Group aims to contribute to a decarbonized society by supporting the company’s businessdevelopment.
Through our support for venture companies, we will continue working to promote the spread ofrenewable energy and the creation of new business opportunities.

VOICE
As a decarbonization support tool for ourcustomers, we are developing our PPA*6based Green Electricity Supply Services.
Going forward, we will promote an off-site
PPA initiative utilizing idle land, etc. tosupply green electricity directly tocustomer power demand sites. Further, as
the movement toward decarbonization is
Executive Officer and General Manager,
Energy & Environment Business Division
Miki Sasaki

accelerating globally, we will actively work
to expand our renewable energy power
generation and electric power

infrastructure businesses overseas as well, primarily in North America, Asia and Europe.
As we continue working to build a sustainable society, we will promote renewable energy
ourselves while creating a variety of businesses that contribute to the spread of green
energy and supporting our customers' efforts toward decarbonization management.

34

*1

Solar secondary projects: In solar power generation, refers to the business of trading in alreadyoperating power plants and the rights to sell electricity.

*2

100% Renewable Electricity Declaration RE Action: Established in October 2019. An initiative forsmall- and medium-sized companies, organizations, and municipalities not covered by RE100 to
declare that they will convert the electricity consumed in their business activities to 100%
renewable energy.

*3

Zero-carbon cities: A local government in which the head of the government or the municipality
itself has announced an aim to achieve virtually zero emissions of greenhouse gases or carbon
dioxide by 2050.

*4

Fuyo Lease will contribute 0.1% of the program's contracted amount, topped up with an additionalamount equivalent to 0.1% in its own funds.

*5

Energy carrier: Refers to hydrogen that has been converted into a state or substance that is easy
to transport and store.

*6

PPA: An abbreviation for Power Purchase Agreement. The PPA provider installs, operates andmaintains solar power generating equipment on the premises of the electric power consumer freeof charge. The power generated is then purchased by the electric power consumer. This has theadvantage of eliminating the need for an initial investment on the part of the power consumer,
while enabling them to implement environmental measures in a sustainable manner.

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> Sustainability> Solving Social Issues through Business> CSV2:Circular Economy

CSV2:Circular Economy

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

CSV1:Energy&
Environment

Behind the Focus on the Circular Economy
The conventional economic model of “taking, making, and throwing away” is called the “linear economy”
because resources are disposed of in a linear fashion without being recycled or reused. It is said that itis difficult to achieve sustainable economic development in a linear economy because of its various
negative impacts, such as the large amount of waste generated, the depletion of finite natural resources
and soaring prices, and the impact of greenhouse gas emissions on climate change. The circular

CSV2:Circular
EconomyCSV3:BPO
CSV4:Mobility
Business
CSV5:Medical& Welfareeconomy has thus become the focus of attention as a new economic model for solving these issues.
The circular economy offers an alternative to the conventional linear economy, an economic model that
reexamines the entire value chain with the goal of maintaining and circulating the value of products andresources for as long as possible, while working toward zero waste emissions. The manufacturing

Environmental
ReportSocial Report

process uses a great deal of energy and emits CO2. This is particularly true of the process of mining andrefining metals and other natural resources, and of the manufacturing process for steel and concrete, allof which are said to involve large amounts of energy use and CO2 emissions. According to estimates by
the Ellen MacArthur Foundation, CO2 emissions related to this kind of manufacturing and the productionof food are said to represent about 45% of overall CO2 emissions. The circular economy, which cuts off
these sources, is a new economic model essential to advancing a decarbonized society.

36

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Environmental Conservation Initiatives to
Date
Under our Environmental Policy, the Fuyo Lease Group has been working to incorporate the 3Rs(Reduce, Reuse, Recycle) in disposing of leased assets after their leases expire in an effort to reduce theenvironmental impact of our business activities.
At the Tokyo 3R Center, which is responsible for reusing and recycling leased assets after their leases
expire, we reuse and recycle not only items leased by our corporate group, but also used assets wehave bought from other companies. Beyond proper compliance with applicable laws and regulations, asa waste generating business operator, we track every piece of waste we dispose of through an electronic
manifest system. We also conduct regularly scheduled on-site inspections of waste disposal contractors,
part of our effort to prevent the generation of environmental pollution.

New Initiatives Toward the Circular Economy
through the Lease Business37

In April 2020, the Group launched its “Circular Economy Domain” as a business domain to evolve its
existing environmental conservation efforts, and is advancing circular economy initiatives through its
leasing business. Achieving the circular economy will require a diverse range of functions, and webelieve that this is an issue we are uniquely positioned to solve, with our vast lease resources andaccumulated know-how in proper disposal.
For example, Fuyo Lease reuses and recycles 100% of the more than 100,000 PCs returned to it eachyear, thereby minimizing waste. This is made possible by the Group's strong information security system
and reliable data erasure, as well as its diverse sales channels, which allow us to sell even old PCs thathave been used for nearly 10 years. In addition, office automation equipment such as printers, which
are difficult to resell, would otherwise become industrial waste with no value, but by dismantling andsorting them by material, we can convert them into raw materials such as recycled plastic. In fact, in
2020 Fuyo Lease began a pilot program for material recycling*1 of printers and other equipment.
In the future, we aim to work in cooperation with our business partners to reduce industrial waste
derived from information and office equipment to zero.

*1

Material recycling: The process of crushing and processing used plastics, pelletizing them by heat
treatment, and reusing them as resin material for plastic products.

A “Platformer” for the Circular Economy
The number of new services aimed at achieving the circular economy are gradually expanding. In April
2021, we began providing a new PC Lifecycle Management Service (PC-LCM) when PCs are being
deployed. In addition to conventional PC leasing functions, the service provides comprehensive support
functions across the entire PC lifecycle, including consulting services for planning PC deployment; help
desk services when failures occur; maintenance support in case of breakdowns; and arrangements for
return at the end of the lease, erasure of HDD data and eventual reuse. We have thus evolved fromproviding products to providing services. By offering appropriate support over the lifetime of our
products, the Group enables customers to deploy PCs longer, more comfortably and with enabling a
reduced burden on the environment when installing.
In auto leasing, Fuyo Auto Lease, a group company, has begun a used auto lease service in which
vehicles whose leases are up are serviced and offered at lower lease rates. This is part of our effort totake on the challenge of extending product life, in this case by developing new ways of utilizing used
vehicles in addition to traditional used car sales channels. Further, we are steadily advancing efforts to
put in place infrastructure and networks aimed at achieving the circular economy in other fields,
including medical equipment, information and communication equipment and material handlingequipment.
The Fuyo Lease Group will continue to evolve in order to achieve the circular economy through its
business. In the future, we aim to build a wide-area ecosystem by expanding the circular economy
infrastructure and network we have built up in the leasing business with the goal of becoming a38

platformer for the circular economy. This will allow those using the Group's services to automaticallyparticipate in the circular economy, and by extension contribute to society as a whole.

VOICE
In November 2020, Fuyo Lease became
the first Japanese financial institution tojoin the U.K.-based Ellen MacArthur
Foundation. The Foundation is one of theworld's leading organizations promoting
the circular economy, and is engaged in
global activities in collaboration withcompanies, research institutions, andgovernment agencies. We will actively
General Manager, Business Assets Management Division
Yasushi Mizuta

participate in workshops organized by theFoundation and joint projects withparticipating companies in order to gain knowledge of the circular economy and tocollaborate with other companies and research institutions. Together with the world's leading
companies and research institutions, we hope to contribute to the establishment of arecycling-oriented society in line with the vision for a circular society.

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> Sustainability> Solving Social Issues through Business> CSV3:BPO

CSV3:BPO

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

CSV1:Energy&
Environment

Issues in Promoting the Introduction of
Telecommuting under the COVID-19
Pandemic Become Clear
The introduction of telecommuting in the corporate sector has progressed, driven by the spread of
COVID-19. Still, the percentage of employees coming to work remains high, in part because of the need

CSV2:Circular
EconomyCSV3:BPO
CSV4:Mobility
Business
CSV5:Medical& Welfarefor some departments such as accounting to handle work like dealing with paper invoices in the office;this has hindered the more widespread use of telecommuting. This kind of work, including receipt of
paper invoices, is affected by the practices and methods used by business partners, and it is extremely

Environmental
Reportdifficult to review these operations without their cooperation.
At the same time, telecommuting has also caused an increase in inquiries to information systems
departments responsible for building a company's system infrastructure, leading to a chronic personnel
shortage. There have also been a number of organizational management issues, including lack of an

Social Report
Governance andManagement

environment that allows employees to concentrate on their core duties, and cases in whichtelecommuting systems were hastily built but still face issues in terms of security andtelecommunications quality.

40

Each Group
Company's
Environmental
and Social
initiatives

Resolving Corporate Issues by Providing New
Solutions
The Group is working to support the resolution of these kinds of issues involved in the introduction of
telecommuting by providing new solutions.

1. Supporting the Complete Shift of Accounting Departments to
Telecommuting: A Total Solution for Accounting and Invoicing
This solution supports the complete shift of accounting departments to telecommuting by utilizing
BConnection Digital Trade*1, a cloud-based invoice digitization service provided by NTT Communications
Corporation (“NTT Com”), and a system linking high-speed document readers and AI-OCR*2 offered byGroup subsidiary NOC Outsourcing & Consulting Inc. (“NOC”), and leverages NOC's many years ofknow-how in accounting BPO. It is provided as an integrated package for undertaking a whole series ofaccounting department operations, and combines the digitized BPO and accounting BPO services NOC
had been providing individually, including receipt and digitization of paper and PDF invoices; journalizingof accounting data by accounting professionals; and linking of journalized invoice data with otheraccounting systems.

*1

BConnection Digital Trade: A cloud-based service provided by NTT Com for digitizing invoices andother documents. It offers functions including creation and issuing of electronic invoices, viewingof electronic invoices within the company, and linking of invoice data to other accounting systems.
The service promotes the corporate shift to paperless operations and remote work, andcontributes to improved productivity.

*2

AI-OCR: The utilization of AI technology in optical character recognition (OCR) used to read anddigitize hand-written documents and forms.

2. Complete Support for Information System Departments: PC
Lifecyle Management (PC-LCM) Service
As information system departments shift their focus to core operations, outsourcing of PC-related tasks
that require energy to manage and run will become an increasingly important factor.
The PC-LCM service includes consulting in overall operations, procurement (equipment selection andrental provision), deployment (setup and delivery management), operations (help desk, replacement
equipment in case of failure, provision of security products), and upgrades (equipment replacement anddata deletion), as well as full outsourcing of various tasks associated with all of these processes. Ourgroup companies work together seamlessly to achieve reasonable pricing while providing complete
support to company information system departments, solving a variety of issues involved in managing
PCs.

41

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assuranceSupporting Acceleration of the Shift to a
Focus on Core Operations
Recently, we have been receiving an increasing number of requests for advice from companies thatwant to concentrate their management resources on their core business (and consider streamlining or
outsourcing non-core operations), and during the COVID-19 pandemic, we have had a strong sense thatcompanies are increasingly conscious of the importance of sustainable growth. These include such
requests as, “We want to take advantage of our head office relocation to streamline operations. Can you
manage our general affairs operations?” or, “We want to consolidate our group company back officedivisions, and would like your advice on setting up a shared company.”
In responding to such inquiries, the Group does not limit itself to the mere general affairs operations,but also visualizes business processes, handles system deployment, and conducts regular reviews ofservice levels and labor costs. In addition, based on our cumulative know-how as an outsourcing
company in standardizing operations, we can also assist in designing shared company business designand operations.
We not only improve efficiency, but by consulting on overall operations promote optimal solution
proposals—including full outsourcing—from a medium to long-term perspective.

42

VOICE
OneVoice, an integrated billing service for utilities that group company INVOICE beganoﬀering in April of last year is attracting renewed attention.
Since the signing of the Paris Agreement in2015, growing international momentum
aimed at a decarbonized society and anemphasis on ESG investing have requiredcompanies to actively work to reduce their
CO2 emissions. While many companies
manage their use of electricity, gas andwater and their CO2 emissions, they arealso expected to properly calculate andGeneral Manager, BPO Service Promotion Division
Koji Yamamoto

review their emissions volumes.

In addition to improving operational efficiency by collecting invoices delivered separately toeach office and converting invoice information to data, OneVoice returns information on
utility usage to each location in the form of data, supporting clients in their efforts tocalculate CO2 emissions and contributing to the resolution of social issues.

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> Sustainability> Solving Social Issues through Business> CSV4:Mobility Business

CSV4:Mobility Business

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

CSV1:Energy&
Environment

Challenges Facing the Industry and How theFuyo Lease Group Will Respond
The automotive industry is entering a once-in-a-century period of great change due to the technologicalinnovations known as CASE*1 and advancements in MaaS*2. In the logistics industry, many social issues
have become apparent, including an increase in the volume of cargo being handled due to theCSV2:Circular
EconomyCSV3:BPO
CSV4:Mobility
Business
CSV5:Medical& Welfareexpansion of the e-commerce market with the impact of the COVID-19 pandemic, shortages of truck
drivers and the aging driver population, and long work hours. Addressing these changes and theirresultant social issues has become an urgent, important issue for many companies, and has also
increased the importance of the create shared value (CSV) perspective in achieving sustainablecorporate growth and enhancing corporate value through solutions to these problems.

Environmental
ReportSocial Report

Against the backdrop of these changes, in April 2020, the Company created a new Mobility Businessdomain combining Fuyo Auto Lease, which provides comprehensive vehicle support services, and
YAMATO LEASE, which oﬀers management support services centered on truck leases to transportcompanies, and also established a new Mobility Business Promotion Division, responsible for planning,
operations, and promotion of this initiative. Further, by adding the Machinery Business Division, which
deals in ﬁnancing services for material handling equipment*3 and construction equipment, to thisdomain, we are positioning the Mobility Business in the Strategic Areas, and have put in place astructure for the Group as a whole to provide services in the industries of automobiles and logistics.
Weare currently working through YAMATO LEASE to actively establish a business collaboration with the
Yamato Group, and are moving forward to review speciﬁc strategies.

44

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

*1

CASE: A term that has been coined from the initial letters of 4 automotive trends: Connected(connected cars), Autonomous (autonomous driving), Shared & Service (shared cars and driving
as a service), and Electric (electrification of vehicles).

*2

MaaS: An acronym for Mobility as a Service, which indicates the creation of services based onmeans of transportation (mobility).

*3

Material handling equipment: Refers to cargo handling machinery used in logistics operations.
These include pallets, forklifts, automated warehouses, conveyer belts and others.

Our Strategic Vision for Future Business
Development and Mobility Business
The Mobility Business aims to solve customer issues by providing wide-ranging solutions in the logistics
and general vehicle areas.
In the logistics areas, we will promote our upstream strategy by further deepening collaboration withpartner companies with the goal of establishing a consulting sales process that visualizes customer
issues and provides solutions in terms of logistics, materials handling and work styles. We will also workto utilize the know-how of our overseas group companies and in other domains, including PRC*4, whichis involved in the forklift leasing business, primarily in the U.S., and TDF*5, which is involved in the
pickuptruck rental, leasing and sales business in North America. Further, we will enhance the added
value of our services by strengthening collaboration and business synergies with close partners such as
the Yamato Group, Sompo Japan Insurance Inc. and Nakamichi Leasing Co., Ltd., while advancing thedevelopment of new services that will lead to resolving customer issues.
In the general vehicle areas, our goal will be to enhance customer satisfaction even further by
supporting safe operations through the introduction of total fleet management services*6, improving
customer fleet utilization rates through the use of car sharing, and encouraging the deployment ofelectric vehicles. We are also focusing on autonomous driving and other new technologies, and arecollecting and accumulating knowledge to leverage in developing the Group's own new services throughongoing dialogue with companies that provide state-of-the-art technology and services.
*4

PRC: A company that handles operating leases for material handling equipment mainly in the
United States.

*5

TDF: A company that engages in rental, leasing, and sales of pickup trucks in North America.

*6

Total fleet management service: A service in which a leasing company contracts to provide
centralized repair, inspection and other vehicle maintenance operations, and that works tostreamline vehicle use and management through the utilization of driving data.

45

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Fuyo Lease Group CSV Initiatives in the
Mobility Business Area
Due to changes in its social structure—including a declining birthrate, aging
population and the concentration of
population in urban areas— Japan today isseeing the emergence of a variety of social
issues related to mobility, such as ensuring
freedom of movement, revitalizing local
communities and reducing environmental
impact. Expectations are focused on
autonomous driving as one means ofsolving these kinds of issues. In June 2021,
the Group entered into a business alliancewith MACNICA, Inc. for the social
implementation of autonomous driving, andhas introduced the ARMA self-driving car
manufactured by Navya, SA of France. We
plan to offer our self-driving vehicles andknow-how for use by local governments

YAMATO LEASE Comfortable Workplace Certificationand companies in proof-of-concept testing, with the goal of achieving early implementation ofautonomous driving and contributing to solving social issues.
In addition, as part of its management support services for transport companies, YAMATO LEASE is
working on a support service for the acquisition of certification under the Driver's Workplace
Environment Quality Certification System (commonly known as the Comfortable Workplace Certification
System)*7, under which thirdparty organizations evaluate and certify driver working conditions andworking environments at trucking companies. The company is the first leasing company to be certified
as an organization that promotes the Comfortable Workplace Certification System, and since the start ofthe system in fiscal 2020, has helped more than 100 firms obtain certification. Going forward, the46

company will continue working to solve transport company management issues by supporting
certification under this system and providing a variety of other services.

Self-driving shuttle bus manufactured by Navya*7

The Comfortable Workplace Certification System: A system aimed at improving working conditions
and workplace environments for drivers, while also certifying operators who are striving toinstitute work style reforms, including remedying long working hours as a means of acquiring andtraining the drivers they need.

VOICE
Established in April 2020, the new Mobility
Business Promotion Division is approachingvarious issues in the areas of automobiles
and logistics, which are undergoing aperiod of historic change. The types ofcustomer issues we see have changed
significantly, and include an increase in thevolume of cargo handled with the rapid
expansion of the e-commerce market; theGeneral Manager, Mobility Business Promotion Division
Shinji Sasakura

expansion of the logistics robot market in
response to labor shortage and BCP; work

style reforms driven by long working hours and an aging population; the shift to electricvehicles in response to climate change and resource shortages; and initiatives for safe
driving support and autonomous vehicles. Through alliances with the Yamato Group,material handling manufacturers and other partner companies, we will promote an upstream
strategy to provide consulting services in the areas of automobiles and logistics, andcontribute to resolving customer issues by providing solutions.

Disclaimer

Disclosure Policy

Privacy policy

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47

Top

> Sustainability> Solving Social Issues through Business> CSV5:Medical & Welfare

CSV5:Medical & Welfare

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

CSV1:Energy&
Environment

Management Issues Faced by Medical
Institutions and Nursing Care Providers, andthe Fuyo Lease Group's Initiatives
With the year 2025 fast approaching, when all baby boomers will be at least 75 years old, demand for
medical and nursing care services for the latter-stage elderly is growing. At the same time, conditions

CSV2:Circular
EconomyCSV3:BPO
CSV4:Mobility
Business
CSV5:Medical& Welfaresurrounding medical institutions and nursing care providers are growing increasingly challenging, with
the need to secure doctors, nurses and other medical workers and nursing care staﬀ, work on reforming
work styles, and respond to the spread of COVID-19. Further, the Regional Medical Care Vision*1

Environmental
Reportadvocated by the Ministry of Health, Labour and Welfare is expected to accelerate the shift in hospitalSocial Report

bed functions and moves to consolidate nursing care providers.
Under these circumstances, medical institutions and nursing care providers must work quickly torationalize management and streamline operations through advancements in ICT and the use of BPO
services in order to secure a reliable supply of human resources and reform work styles. In addition, theneed to eﬀectively procure funding and equipment following the breather provided by the directed loan
program of the Welfare and Medical Service Agency*2 is gradually becoming apparent.
The Fuyo Lease Group has positioned Medical & Welfare as one of its Strategic Areas, and is working toprovide lease ﬁnancing for medical institutions and nursing care providers, factoring of medical andnursing care receivables and other ﬁnancing services; the Group is also working to acquire andstrengthen consulting capabilities. The main pillar of our strategy is to oﬀer a one-stop solution for avariety of management issues faced by our customers by working in cooperation with alliance partners
and utilizing the Group's healthcare-related services.

48

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

*1

Regional Medical Care Vision: This initiative aims to create a framework for the division of rolesand cooperation among medical institutions through the cooperation of local stakeholders, in orderto estimate medical needs in 2025 and create a medical system that responds to those needs.

*2

Welfare and Medical Service Agency: An independent administrative corporation established topromote welfare and improve the spread of medical care. It engages in loan business for thedevelopment of social welfare facilities and medical facilities, etc.

Integration of Group Functions in the Medical
and Welfare Fields and Expansion of the Fuyo
Lease Platform Concept
Utilizing the specialized knowledge and human networks of our Healthcare Advisory Division, establishedin April 2019, the Group is working to enhance sales activities aimed at management at medical
institutions that play a central role in regional medical care. By actively approaching management, wegain a better understanding of the specific needs of each medical institution. We utilize their needs inproposals aimed at solving their issues, while also leveraging this information to develop new services
and expand our business domains.
On their own or in collaboration with alliance partners, each of our group companies is working toenhance the Fuyo Lease Platform Concept to offer one-stop, wide-ranging solutions by combining theservices they are capable of providing tailored to customer needs.
The Group provides a wide range of services, including leasing and f inancing of medical equipment andnursing care facilities; factoring services for medical and nursing care receivables provided by Accretive;
removal and resale of used medical equipment provided by FUJITA; opening support services for clinics
such as initial capital loans and clinic area surveys provided by Sharp Finance; and BPO services
provided by NOC Outsourcing & Consulting. In addition, we are expanding our consulting services forbusiness improvement using RPA and AI-based medical fee billing in collaboration with medical
consulting companies by utilizing our ties with alliance companies.
In addition, under the platform concept, we are working to promote and spread the use of advanced
medical devices developed by medical venture companies. In April 2020, we entered into a capital andbusiness agreement with THINKCYTE INC., which conducts research and development in nextgeneration cell isolation systems using AI. We will continue to promote collaboration and cooperation
with highly specialized alliance companies, including the development of high value-added products withthis company and other medical device manufacturers, to further expand our platform concept andcontribute to solving diverse customer needs.

49

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Taking on New Business Domains
In January 2021, the Group entered into a capital and business agreement with CB Holdings Inc., which
provides information services specific to the medical and welfare industries, including M&A brokerage,
support for opening businesses, management consulting, recruiting and business development support
and news distribution. Through the trust it has built with medical institutions since its founding, andthrough its networks and wide-ranging solutions, the CB Group leads to solving a wide variety ofmanagement issues in the medical and welfare industries. We are working to create business synergies
through the integration of the know-how, networks and services of the CB Group and the Fuyo Lease
Group, with the goal of expanding our business domains in the Medical & Welfare fields.
Another new business area we are working in is to improve the sustainability of medical and nursing
care functions in local communities. The sustainability of these functions is an essential element in therevitalization of local economies, and we believe that regional financial institutions, which have built
relationships of trust with local governments, medical institutions and nursing care providers, play animportant role in this regards. The Group has provided a variety of services to local medical institutions
and nursing care providers in cooperation with regional financial institutions. For example, as part of thelineup of management support services offered by major nursing care providers, ranging from theopening of new nursing care facilities to operational improvements, the Group's nursing care andwelfare equipment leasing and nursing care receivables factoring services are offered to providers thatare clients of regional banks. We are currently working to further advance collaboration with regional
financial institutions to build a framework to financially support the business operations of local nursing
care providers and to meet the financial needs of medical institutions for business succession andrebuilding of aging facilities. Through these various efforts, we will contribute to improving thesustainability of medical and nursing care functions in local communities.

VOICE
The Healthcare Business Promotion Division, established in April 2021, has taken the lead inbuilding a group-wide website that will enable the Group to provide its products and services
in the Medical & Welfare f ields in an integrated manner. We will position this website as apoint of contact for providing services that will lead to solving issues faced by medical
institutions and nursing care providers, and aim to build a website that is attractive tocustomers by providing information that is useful for their business operations.
In addition, FUJITA, a group company
engaged in removal and resale of used
medical equipment, dismantles medical
equipment that has been returned at theend of the lease period and breaks it down
into parts and materials that can be resold,and has started a business to sell the parts
to used equipment domestic and overseas
trading companies, and the materials to
Executive Oﬃcer and General Manager,
Healthcare Business Promotion Division
Hideyuki Otsubo

buyers of valuables. In the future, we will
expand the scope of this business toinclude other companies that have terminated their leases, and by promoting the recyclingof medical equipment, we will contribute to reducing environmental impact and promoting a
resource-recycling economy.

50

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

51

Top

> Sustainability> Environmental Report

Environmental Report

Environmental
Philosophy/
Environmental Policy

Environmental
Management

Fuyo Lease Group Key
Environmental Targets
and Results

Climate Change
Initiatives

Environmental data

Environmental
Accounting

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportEnvironmental
Philosophy/
Environmental
PolicyEnvironmental
Management
Fuyo Lease
Group Key
Environmental
Targets andResults
ClimateChangeInitiatives
Environmental
data
Environmental
Accounting

Social Report52Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

53

Top

> Sustainability> Environmental Report> Environmental Philosophy/ Environmental Policy

Environmental Philosophy/ Environmental Policy

Environmental Philosophy

Sustainability

The Fuyo Lease Group constantly adopts environmentally-friendly business practices in order to realize asustainable society and promotes activities to address environmental issues in line with its

Fuyo Lease
Group's CSV

environmental policy.

Solving Social
Issues throughBusiness

Environmental Policy
1.Providing products and services that contribute toenvironmental conservation
We endeavor to provide products and services that contribute to environmental conservation by having
each Group company leverage the characteristics of their business activities.

2.Promoting resource and energy saving activities
We are aware of the environmental burdens associated with business activities and endeavor to engage
in resource and energy saving activities and green procurement.

3.Contributing to the development of a circular society
We promote the reuse and recycling of goods no longer leased, restrict the generation of waste, andensure proper disposal of waste.

4.Complying with environmental laws
We comply with environment-related laws and agreements to which the Fuyo Lease Group has agreed.

Environmental
ReportEnvironmental
Philosophy/
Environmental
PolicyEnvironmental
Management
Fuyo Lease
Group Key
Environmental
Targets andResults
ClimateChangeInitiatives
Environmental
data
Environmental
Accounting

5.Establishing an environmental management system
We promote continuous improvement of an environmental management system and set environmental
targets as we endeavor to respond to climate change, prevent environmental pollution, and conserve
biodiversity.

54

Social ReportGovernance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

55

Top

> Sustainability> Environmental Report> Environmental Management

Environmental Management

Environmental management system

Sustainability

Within the Fuyo Lease Group, the President of Fuyo General Lease serves as Chief Executive, and the
Director responsible for the Creating Shared Value Promotion Office serves as Environmental Control
Officer. The Group has an environmental management system structure that covers the Fuyo Lease
Group companies.

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportEnvironmental
Philosophy/
Environmental
PolicyEnvironmental
Management
Fuyo Lease
Group Key
Environmental
Targets andResults
ClimateChangeInitiatives
Environmental
data
Environmental
Accounting

Social Report
Environmental management system structure56

Acquired ISO14001 certification
Fuyo Lease and Group companies acquired ISO14001

See Glossary

Governance andManagement

certification for their main

business offices in July 2006, and passed a renewal audit for the fifth time in June 2021. In order topractice environmentally conscious management, we will continue striving to robustly implement ourenvironmental management system.

ISO14001: 2015 scope of the acquired certification
Fuyo General Lease: Head Office (engaged in leasing business, installment sales, financing, andother financial service operations)
Fuyo Lease Sales: Head Office and Tokyo 3R Center (processing re-leasing contracts as an agent,
selling and disposing of lease-expired properties, and purchasing and selling used properties)
Fuyo Network Service: Head Office, Technical Support Center and Hachioji Technical Center (sellingcomputers, software and networking devices)
FGL Group Business Service (engaged in contract sales administration and non-life insurance agent
business)
FGL Group Management Service (engaged in contract human resources and general affairs
operations)

Appendix 1

ISO14001: 2015 Management System
Certificate

Click on the image to enlarge it.

Click on the image to enlarge it.

Internal environmental audit and externalaudit
The Fuyo Lease Group strives to continuously improve its environmental management system throughactivities such as internal environmental audits and external audits.

57

Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Internal environmental audit
Initially, after the introduction of the environmental management system, all the departments, offices,branches and Group companies were subject to an internal environmental audit every year. Over time,the environmental management system was spread throughout all of the Group companies. Therefore,
since fiscal 2012, we have been conducting internal environmental audits on about half of thedepartments, offices, branches, and Group companies every year in rotation.

Audited departments and audit results

Head Office
Departments/
Offices

BranchesGroup
companies

FY 2016

FY 2017

FY 2018

FY 2019

9

23

14

18

27

departments/

departments/

departments/

departments/

departments/

offices

offices

offices

offices

offices

-

1

-

-

-

1

None

1

branchNone

3companies

company

company

Major nonconformance

None

None

None

None

None

Minor nonconformance

None

None

None

None

None

None

None

None

None

None

2 cases

None

None

None

None

Opportunitiesfor
improvement*
Good
performance*

FY 2015

Opportunities for improvement: advice on making future improvements

External audit
In August 2020, we received an external audit for ISO14001 certification.
We will continue making improvements by taking into consideration the audit results and advice we
receive.

58

External audit results

Audit results

Strong point

Good point

Opportunities for
improvement*

Findings for
improvement

*

June
2016

June
2017

June
2018

June
2019

August
2020

None

None

None

1

None

case

2

1

3

1

3

cases

case

cases

case

cases

2

3

1

1

cases

cases

case

case

None

None

None

None

None

None

Opportunities for improvement: advice on making future improvements

Environmental education
The Fuyo Lease Group regularly provides environmental training to deepen the understanding of theenvironmental management system and to increase environment-related knowledge and skills.
The following table shows the implementation status for fiscal 2019

Implementation status of environmental education (FY 2019)
Training

Employee
Training

Number ofParticipants

PeriodEnvironmental elearning

July 2019

1,168 employees

Tokyo 3R Center
Training Program

July 201932 employees

Sanden Forest
Biodiversity Training
Program

May 2019

New employees
31
employees

59

In ﬁscal 2019, we conducted an environmental e-learning program
targeting all employees to increase their knowledge of the latest
environment-related information and environmental laws, and also
implemented the Tokyo 3R Center Training Program targeting new
employees and others who were interested, under which they had
an opportunity to visit sites practicing 3R for lease-expired
properties, in order to increase their understanding of the Group's
environmental measures.

Tokyo 3R Center Training Program

Promoting taking the Eco Test
The Fuyo Lease Group is encouraging its employees to take the Certification Test for Environmental
Specialists, Eco Test, in order to increase their environmental awareness.
In fiscal 2019, 11 employees passed the test, and as of the end of March 2020, a total of 282
employees have passed the test.

Environmental Risk Management
In addition to ensuring compliance with laws and regulations concerning waste disposal, we conduct onsite surveys of companies contracted to dispose lease-expired properties in order to reduce
environmental risks related to waste disposal.

Proper disposal of lease-expired properties
Fuyo Lease complies with laws such as Waste Management and Public Cleaning Law (Waste
Management Act) and appropriately disposes of lease-expired properties that cannot be reused.
Furthermore, in addition to systematically conducting surveys to examine the waste disposal approaches
and recycling activities performed by contracted disposal companies, we also thoroughly manage andutilize the manifests* of industrial waste management.
*

Manifest: a document or electronic data for examining whether waste has been disposed ofappropriately. Waste generating business operators are required by the Waste Management Act toissue and collect, or register a manifest in order to confirm proper disposal of waste.

For more details, please refer to the appropriate waste disposal approaches being adopted by Fuyo
Lease Sales, a group Company which have been contracted by Fuyo Lease to perform back-office tasks.

Compliance with environmental laws andregulations
Inspection Result

Cases

Violation of law

None

Environment-related
complaints

None

60

The Fuyo Lease Group, through various environmental education activities, strives to ensure that all its
officers and employees comply with environmental laws and regulations. Furthermore, the Groupregularly conducts compliance checks concerning environmental laws and regulations, whereby thestatus of compliance with the environmental laws and regulations is confirmed. The fiscal 2019
compliance checks, covering the period between February 2019 and January 2020, were inspected in
February 2020. In the checks, it was confirmed that there were no cases constituting a violation of laws
and regulations, and that there were no cases involving environment-related complaints. Similarly, in
previous years, there were no cases constituting violation of environmental laws and no cases involving
environment-related complaints.

Obtained the highest-level ranking in the DBJ Environmental Rating for the ninth
consecutive year
In fiscal 2019, as in the previous fiscal year,
the Company obtained the highest-level
ranking in the DBJ Environmental Rating*assigned by Development Bank of Japan,
Inc. for the ninth consecutive year for its
exceptionally advanced environmentallyconscious approach.
We were highly evaluated for our initiatives
that are aligned with our management
philosophy of “supporting corporate activities through our leasing business with a view tocontributing to the development of society.” Specifically, the following initiatives received
recognition: (1.) We continued to identify materiality and set as well as review KPIs while
being conscious of connections to our core businesses based on the SDGs andenvironmental changes caused by climate change and other issues. Additionally, weconstructed a company-wide sustainability management system through the establishmentof the Creating Shared Value Promotion Office. (2.) We became the first general lease
company in Japan to join RE100. Additionally, we launched the Fuyo 100% Renewable
Electricity Declaration Support Program, established an original financing model to promoterenewable energy, and have been promoting trailblazing initiatives. (3.) We positioned CSV
as the focal point of our long-term strategy, and not only did we respond to environmental
issues through the previously mentioned Energy & Environment fields, but we are also
actively creating new businesses that contribute to multi-faceted value creation based onsocial issues through the Medical & Welfare field and BPO business.
We will continue to pursue environmental initiatives and actively disclose the results.
*

DBJ Environmental Rating is a rating system developed by the Development Bank ofJapan, Inc. for the rating companies based on the level of their environmental
management practices. Based on this, companies can receive loans from the bank at
preferential interest rates according to their respective ratings.

61

Glossary

ISO14001
ISO14001 is a global standard for environmental management system specifications
established by the International Organization for Standardization. The International
Organization for Standardization, headquartered in Switzerland, is a private organizationthat creates international standards.

Disclaimer

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Privacy policy

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62

Top

> Sustainability> Environmental Report> Fuyo Lease Group Key Environmental Targets and Results

Fuyo Lease Group Key Environmental Targets andResults
Environmental Targets (Medium to Longterm)
The Fuyo Lease Group has set forth the use of renewable energy in its operations and the achievementof carbon neutrality as its medium to long-term environmental targets, and we are advancing thedecarbonization of our own business.

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
Report*1

Scope covers Fuyo General Lease and its consolidated subsidiaries.

*2

Scope 1: Direct emissions from the use of fuel for company vehicles and city gas, Scope 2:
Indirect emissions from the use of purchased electricity, etc.

Environmental
Philosophy/
Environmental
PolicyEnvironmental
Management
Fuyo Lease
Group Key
Environmental
Targets andResults
ClimateChangeInitiatives
Environmental
data
Environmental
Accounting

Social Report63Environmental Targets (Short-term)

Governance andManagement

Evaluation: ◯ target achieved, × target not achieved

Objectives

ClimatechangeScope

Fuyo
Generalinitiatives

FY 2020
targets

10.0%

Lease &
Group

companies*3

decrease fromthe FY 2013
level of CO₂
emissions (tCO₂) (Scope 1

FY 2020
results

Evaluation

28.6%
decreasefrom the FY○

FY 2021targets

5.0%
decrease fromthe FY 2020
level of CO₂

2013 levelemissions (tCO₂)(The& 2)

scope ofcoverage was
expanded toinclude Fuyo
General Leaseand its
consolidated
subsidiaries.)

Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

Promoteenergyconservation

Comply withenvironmental
laws andregulations

Fuyo
GeneralLease &
Group
companies*3

Fuyo
GeneralLease &
Group

companies*3

5.0%
decrease fromthe FY 2013
level ofenergyconsumption
(kWh)

13.4%
decrease

10.0%
decrease fromthe FY 2013
level ofgasoline anddieselconsumed bycompany
vehicles (L)47.7%
decreasefrom the FY
2013 level

○

10.0%
decrease fromthe FY 2013
level ofgasoline anddieselconsumed bycompany
vehicles (L)AssessConducted
compliance○

Assesscompliancewithenvironmental
laws andregulations*3○

from the FY
2013 level

5.0%
decrease fromthe FY 2013
level ofIndependent
assuranceenergyconsumption(kWh)assessment.
No noncompliancefoundcompliancewithenvironmental
laws andregulations

Scope: all domestic locations of Fuyo General Lease and Group companies including Fuyo Auto
Lease, Fuyo Network Service, Aqua Art, Fuyo Lease Sales, FGL Group Business Service and FGL
Group Management Service.

Disclaimer

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64

Top

> Sustainability> Environmental Report> Climate Change Initiatives

Climate Change Initiatives

Basic Approach

Sustainability

Today, climate change is a universally recognized problem, and increasing greenhouse gas emissions aremaking it worse. As the Paris Agreement, an international framework for climate action beyond 2020,and other initiatives give momentum to efforts to reduce greenhouse gas emissions across the globe,
renewable energy along with environmentally-friendly products and services are more important thanever.
The Fuyo Lease Group is holding up "responding to climate change issues and renewable energy" as oneof its materialities (material issues), and working towards climate change mitigation by reducing

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusinessgreenhouse gas emissions from our operations. We carry out business activities in view of risks andopportunities in the business environment that climate change brings. With a BCP in place, we are well
prepared for any emergency in which our business activities could be disrupted by the destruction ofEnvironmental
Reportsocial infrastructure caused by a natural disaster. We also recognize that business opportunities lie in
renewable energy generation and energy-efficient assets leasing businesses. This is an area we will
focus upon as one of the strategic areas of the Medium-term Management Plan. We aim to grow ourbusinesses alongside activities to mitigate climate change.
Examples of the risks and opportunities that the Fuyo Lease Group perceives climate change will bring

Environmental
Management

about are as follows

Impact on business results due to regulations such as carbon
tax and major regulatory changes (medium-to-long term)

Risks

Restrictions on business activities due to damage to social
infrastructure etc. resulting from an increase in natural
disasters (medium-to-long term)
Decline in revenues from electricity sales in the renewableenergy generation business due to the impact of unseasonal
weather (medium-to-long term)

Increase in demand for renewable energy (medium-to-longterm)

Opportunities

Environmental
Philosophy/
Environmental
PolicyIncrease in demand for leasing energy-saving equipment,
etc. (medium-to-long term)

Fuyo Lease
Group Key
Environmental
Targets andResults
ClimateChangeInitiatives
Environmental
data
Environmental
Accounting

Increase in demand for environmentally-friendly products
and services (medium-to-long term)Social Report65

As with the other environmental issues, we have established a system for managing climate change
countermeasures with the Chief Executive (the President of Fuyo General Lease) and the Environmental
Control Officer (the Director responsible for the Creating Shared Value Promotion Office). The president,
who serves as the Chief Executive, regularly receives reports on the Group's progress on climate change
initiatives, and decides on policies after reporting and discussing particularly important issues with theBoard of Directors. We will continue to properly manage and promote our efforts group-wide.

Initiatives to Reduce Greenhouse Gas
Emissions
The Japan Leasing Association has formulated a voluntary low-carbon society action plan, which Fuyo
Lease has signed on to as a member company.
The Fuyo Lease Group is making efforts to conserve the environment at all our locations by setting
targets that lower our CO₂ emissions and energy consumption, and work to reduce power usage, as well

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluationas our company vehicles' fuel consumption and exhaust emissions. In 2018, we started to issue green
bonds (available only to those businesses that are expected to improve the environment) to raise funds

Editorial Policy

from a variety of sources while promoting renewable energy. In the same year, we officially joined theJapan Climate Leaders Partnership (JCLP), a group of companies that aims to realize a sustainable,
carbon-free society. In addition, we joined RE100, a business initiative which aims to source 100%
renewable energy to power business activities. In 2019, we publicly endorsed the Task Force on
Climate-related Financial Disclosures' (TCFD) recommendations.
Not only does the Group make direct efforts to reduce its own greenhouse gas emissions but also makes
indirect contributions to reducing greenhouse gas emissions through promoting renewable energy byutilizing schemes of lease and finance.

Total CO₂ Emissions (Scope 1,2)*1 *2

Total Energy Consumption*2

66

Independent
assuranceElectricity Consumption*2*

Total Gasoline and Diesel
Consumed by Company
Vehicles*2

A checkmark ☑ indicates that figures have been assured by KPMG AZSA Sustainability Co., Ltd.

Independent assurance*1

Total CO₂ emissions were calculated with the emission factors specified by the government basedon the Ministerial Ordinance Concerning GHG emissions Associated with Business Activities ofSpecified Emitters (The emissions associated with electricity are calculated based on the emission
factor issued by power transmission and distribution business operators of where our regional
operations and offices are located). Fuyo General Lease and the Groups' companies are notincluded in specified emitters.
Our scope 1 and 2 emissions were 603 t-CO₂ and 1,460 t-CO₂ respectively in fiscal 2020.

*2

Data coverage: all domestic locations of Fuyo General Lease, Fuyo Auto Lease, Sharp Finance,
Accretive, INVOICE, NOC Outsourcing & Consulting, YAMATO LEASE, FUJITA, Fuyo Network
Service, Aqua Art, FGL Group Business Service, and FGL Group Management Service. For groupcompanies, figures prior to the start of data collection are not included.

*3

6 group companies: all domestic locations of Fuyo Auto Lease, Fuyo Network Service, Aqua Art,
Fuyo Lease Sales, FGL Group Business Service, and FGL Group Management Service.

Adapting to climate change
The Fuyo Lease Group is not only engaged in mitigation activities for climate change, but the Group isalso carrying out adaption measures for it. We have a business contingency plan in place for responding
to extreme weather, which includes measures taken to prepare for massive ﬂooding that could occur at
our business sites, or data centers, and we are working to minimize risks.

67

Energy Conservation via Products andServices
We have partnered with energy-saving equipment manufacturers, construction companies, andcompanies in other various sectors to help customers save energy through the ESCO service and otherprograms. The ESCO service provides everything needed to improve energy eﬃciency, including
technology, equipment, personnel, and funding, and achieves energy conservation withoutcompromising a customer's current environment or convenience. As the ESCO service provider, we
receive a portion of the actual energy cost savings generated through the service as compensation. In
addition, we help our customers reduce costs and CO₂ emissions by introducing various energy saving
solutions tailored to their energy usage. Examples of the solutions include energy-saving control andoperational improvement for air-conditioning systems and LED lightings, and subsidized leasing.

Promotion of Renewable Energy
As climate change risks increase, the renewable energy market continues to grow with a focus on solar,
wind, biomass, small and medium hydro, and geothermal power. Fuyo Lease leverage the know-how
gained through our power generation business to offer a host of power generation equipment
installation plans that meet a wide array of customer needs. Those include everything from large-scale
power plants to rooftop solar panels of distribution warehouses and other commercial facilities as offgrid schemes for self-consumption. Along with various financing options, we introduce them tocustomers with the aim of taking the use of renewable energy to new heights.At the same time, we arecontributing to further expanding the introduction of renewable energy by forming business allianceswith venture companies that have advanced renewable energy-related technologies, and supporting
industrialization and commercialization.

Initiatives in the Renewable Energy Generation Business
The Fuyo Lease Group launched
its renewable energy generation
business in 2012, and now
supplies renewable energy tolocal communities equivalent tothe annual power consumptionof approximately 85,000
households.* In fiscal 2020, we
participated in a fund organizedby Green Power Investment

Wind Farm Tsugaru in Tsugaru City,
Aomori Prefecture, Japan

Corporation to invest in renewable energy power generation projects in five locations inJapan, as well as renewable energy power generation projects in the U.S. and Taiwan.
Including equity participation, this increased the Group's power generation capacity to 283
MW-dc.
*

Calculated based on electricity consumption of 3,600 kWh/year per household.

68Renewable Energy Power Generation Capacity (output)/Power
Supplied/CO₂ Reduction (estimation)

Promoting Renewable Energy-Related Infrastructure
We offer two programs that provide financial support to companies and organizations
working toward decarbonization: the Fuyo 100% Renewable Electricity Declaration Support
Program, and the Fuyo Zero Carbon City Support Program.
The Fuyo 100% Renewable Electricity Declaration Support Program is a preferential
financing program for businesses and organizations that have joined RE100 and the 100%
Renewable Electricity Declaration RE Action. Using funds raised by the Company throughgreen bonds, the program is aimed at encouraging the introduction of renewable energy
facilities and energy-efficient equipment.
Click here for details

The Fuyo Zero Carbon City Support Program is a donation-built-in program open to allcompanies, organizations, and local governments. Along with customers who install
facilities and equipment that contribute to decarbonization in areas of municipalities thathave declared themselves zero-carbon cities, the program donates an amount equivalent
to 0.2% of the value of lease contracts to organizations that contribute to promoting zerocarbon cities.
Click here for details

69

Providing Support for Investments in Renewable Energy-Related Technologies
and Their Commercialization
In order to contribute to the further expansion of renewable energy introductions, we
provide commercialization support to venture companies possessing cutting-edge
renewable energy technologies through investments and business collaborations.

Major Support Results
Investment
TimingJune 2018

Partner

Exergy Power Systems

Description

Development andmanufacture of nextgeneration energy storage
systemsMar. 2019

NExT-e Solutions

Provision of battery
management systems thatutilize advanced battery
control technologies

Feb. 2020

Girasol Energy

Development of IoT platforms
for the maintenance andmanagement of solar power
facilities

Oct. 2020

Disclaimer

Disclosure Policy

Tsubame BHB

Development manufacturing
technology for distributed
production of ammonia under
low-temperature, lowpressure conditions

Privacy policy

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70

Top

> Sustainability> Environmental Report> Environmental Data

Environmental Data

Energy / CO₂*1
Total Energy Consumption

Sustainability
Electricity Consumption
Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportTotal Gasoline and Diesel
Consumed by Company
VehiclesTotal CO₂ Emissions (Scope 1,
2)*3

Environmental
Philosophy/
Environmental
PolicyEnvironmental
Management
Fuyo Lease
Group Key
Environmental
Targets andResults
ClimateChangeInitiatives
Environmental
data
Environmental
Accounting

Social Report71Total CO₂ Emissions(adjusted) (Scope 1, 2)*4

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance*

A checkmark ☑ indicates that fiscal 2020 figures have been assured by KPMG AZSA Sustainability
Co., Ltd.

Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

Independent assurance

Independent
assurance
tal CO₂

CO₂ emissions (Scope 1, 2, 3)CO₂ emissions (t-CO₂)
Ratio of total CO₂
emissions(2021/3)

2017/3

2018/3

2019/32020/32021/3☑

Scope 1

163

770

707

687

603

0.03%

Scope 2

1,108

1,304

1,230

1,318

1,460

0.06%

Scope 3*5

1,639,334

1,768,197

1,660,727

2,866,387

2,372,283

99.91%

Total CO₂
emissions

1,640,605

1,770,271

1,662,664

2,868,394

2,374,345

100%

CO₂ emissions(Components of Scope 3)*572

2017/3

2018/3

2019/32020/32021/3Composition
ratios intotal CO₂
emissions(2021/3)--

2,120,559

2,166,659

1,837,264

77.45%

Calculated bymultiplying theactual amount bysegment based on
the contract
execution results ofleasing andinstallment sales forthe current fiscal
year in consolidated
accounting by theemission intensity
based on the InputOutput Tables forJapan and purchaseprice for the target
device.

1,638,389

1,767,060

994

1,074

8,359

0.35%

Calculated bymultiplying theacquisition amountof corporate assets
purchased in thecurrent fiscal yearby the emission
intensity.

102

207

347

362

366

0.02%

Calculated bymultiplying theamount ofelectricity and fossil
fuels used in the
Scope 1 and 2
calculations byemission intensity.

--

413,244436,416

303,049

12.77%

Based on thecontract execution
results of leasing
and installment
sales for the current
ﬁscal year inconsolidated
accounting, andassuming theweight per amountof therepresentative
product, thetransportation
tonne -kilometer iscalculated from thetransportation
distance (domestic
truck transportationof 1,000 km oneway) based on thetransportation
scenario. Thistransportation
tonne -kilometer isthen multiplied by
the domestic truck
transportation
emission intensity.

CO₂ emissions (t-CO₂)
Category

1. Purchased
goods andservices

2. Capital
goods

3. Fuel- andenergyrelated
activities notincluded in
Scope 1 or 2

4.
Transportation
anddistribution(upstream)73

Calculation
method/remarks

2017/3

2018/3

2019/32020/32021/3Composition
ratios intotal CO₂
emissions(2021/3)

214

294

258

291

170

0.01%

Until 2020/3,
calculated bymultiplying theamount of industrial
waste and theamount of generalwaste by theemission factors foreach type of waste
and disposal
method. From
2021/3, calculated
by multiplying theamount of industrial
waste by theemission factors foreach type of waste
and disposal
method.

221

223

255

314

94*

0.00%

Calculated bymultiplying thenumber of
consolidated
employees by theemission intensity
per employee.
* Because businesstravel was
signiﬁcantly reduced
in 2021/3 due tothe impact of the
COVID-19,
calculated bymultiplying thenumber of
consolidated
employees by theemissions intensityand percentage ofbusiness travel
expenses compared
to previous year.

408

412

471

576

631

0.03%

Calculated bymultiplying thenumber of
consolidated
employees by the
number of businessdays and theemission intensity
by work type andcity per number ofworking days.

N/A

N/A

N/A

N/A

N/A

N/A

Not
applicable(Energy
usage for rented
oﬃces, etc., isincluded in Scope 1
and 2.)

N/A

N/A

N/A

N/A

N/A

N/A

Not
applicable(There are
no applicableemissions since theCompany bears
transportation costsin the entire
logistics process.)

CO₂ emissions (t-CO₂)
Category

5. Waste
generated inoperations

6. Businesstravel

7. Employee
commuting

8. Leased
assets(upstream)

9.
Transportation
anddistribution(downstream)74

Calculation
method/remarks

2017/3

2018/3

2019/32020/32021/3Composition
ratios intotal CO₂
emissions(2021/3)

N/A

N/A

N/A

N/A

N/A

N/A

Not
applicable(There are
no applicableemissions since theCompany does nothandle intermediate
products.)--

247,227

254,848

213,255

8.99%

Calculated byestimating theenergy consumption
during use andmultiplying by theemission intensity
for each energy
type, based on thecontract execution
results of leasing
and installment
sales for the current
fiscal year inconsolidated
accounting,assuming sales
volume per price ofthe representative
product and thestandard usage
scenario (withassumptions
regarding productdesign specifications
and consumer
conditions of use),
etc.

-

-

16

17

15

0.00%

Based on thecontract execution
results of
installment sales forthe current fiscal
year in consolidated
accounting, theweight per amountof representative
product is assumed,
the installment
sales productweight is calculated,
and this weight ismultiplied by theemission intensity
for each waste type.

-

-

-

-

-

-

Emissionsassociated with useof leased products
are recorded in
Category 11.

CO₂ emissions (t-CO₂)
Category

10. Processingof sold
products

11. Use ofsold products

12. End-of-life
treatment ofsold products

13. Assets(downstream)75

Calculation
method/remarks

2017/3

2018/3

2019/32020/32021/3Composition
ratios intotal CO₂
emissions(2021/3)

N/A

N/A

N/A

N/A

N/A

N/A

Not
applicable(There are
no applicableemissions since theCompany has nofranchise.)

-

-

6,185

5,830

9,080

0.38%

Calculated bymultiplying previous
fiscal year's Scope 1
and 2 emissions ofmajor investees by
the shareholding
ratio. (2021/3 iscalculated bymultiplying the
Scope 1 and 2
emissions of major
investees in fiscal
2019 by theshareholding ratio.)

1,639,334

1,768,197

2,789,556

2,866,387

2,372,283☑

100%

The Ministry of theEnvironment’s“Basic Guidelines on
Accounting forGreenhouse Gas
EmissionsThroughout theSupply Chain(ver.3.0)” and the“LCI database
IDEAv2 (forcalculating
greenhouse gas
emissions in supply
chains)” are applied
to the above
emission intensity.

CO₂ emissions (t-CO₂)
Category

14. Franchises

15.
Investments

Total CO₂
emissions*1

Calculation
method/remarks

Data coverage: all domestic locations of Fuyo General Lease, Fuyo Auto Lease, Sharp Finance, Accretive, INVOICE, FUJITA, Fuyo Network
Service, Aqua Art, Fuyo Lease Sales, FGL Group Business Service, FGL Group Management Service, NOC Outsourcing & Consulting and YAMATO
LEASE.
For group companies, figures prior to the start of data collection are not included.

*2

6 group companies: all domestic locations of Fuyo Auto Lease, Fuyo Network Service, Aqua Art, Fuyo Lease Sales, FGL Group Business Service
and FGL Group Management Service.

*3

Total CO2 emissions were calculated with the emission factors specified by the government based on the Ministerial Ordinance Concerning GHG
emissions Associated with Business Activities of Specified Emitters (The emissions associated with electricity are calculated based on the emission
factor issued by power transmission and distribution business operators of where our regional operations and offices are located). Fuyo General
Lease and the Groups' companies are not included in specified emitters.

*4

Total CO₂ emissions (adjusted) were calculated with the emission factors specified by the government based on the Ministerial OrdinanceConcerning GHG emissions Associated with Business Activities of Specified Emitters (The emissions associated with electricity are calculated basedon the adjusted annual emission factors issued by power transmission and distribution business operators of where our regional operations andoffices are located).

*5

Scope 3 emissions are calculated for all calculable categories based on "Basic Guidelines on Accounting for Greenhouse Gas Emissions Throughout
the Supply Chain (Ministry of the Environment, Ministry of Economy, Trade and Industry)."
The data up until fiscal 2017 was calculated using the emissions unit values from the "Database for Emissions Unit Values for Calculation ofGreenhouse Gas Emissions, etc., by Organizations throughout the Supply Chain (Ver. 2.6)"
From fiscal 2018, the data was calculated using emissions unit values from the "Database for Emissions Unit Values for Calculation of Greenhouse
Gas Emissions, etc., by Organizations throughout the Supply Chain (Ver. 3.0)" and "LCI Database IDEAv2 (For Calculating Greenhouse Gas
Emissions in the Supply Chain)."
The scope of calculations is the Fuyo Lease Group.

76

WasteVolume of Industrial Waste
Generated*6*6

Data coverage: all domestic locations of Fuyo General Lease and Fuyo Lease Sales.

Water Consumption*7
Water Consumption*7

The scope of calculations is Fuyo General Lease / Head Oﬃce (including FGL Group Business
Service) and Aqua Art. Due to the relocation of the head oﬃce, water consumption at Fuyo
General Lease/Head Oﬃce has been signiﬁcantly reduced since ﬁscal 2020, as water consumption
on only some ﬂoors has been counted since June 2020.

Disclaimer

Disclosure Policy

Privacy policy

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77

Top

> Sustainability> Environmental Report> Environmental Accounting

Environmental Accounting

Publishing the Results of Environmental
Activities by Introducing the Environmental
Accounting System
The Fuyo Lease Group focuses efforts not only on improving its environmental performance but also on

Sustainability

Fuyo Lease
Group's CSV

proposing services useful for enhancing the environmental performance of customers.
In addition, the Group has introduced environmental accounting* with the aim of conducting aquantitative assessment of the results of its environmental activities and reporting the results of theSolving Social
Issues throughBusiness

assessment to customers and other stakeholders in an easy-to-understand format.
*

Environmental accounting: Environmental accounting is a procedure that allows a company toidentify the cost of environmental conservation during the normal course of business, identify
benefit gained from such activities, provide the best possible means of quantitative measurement
and support the communication of its results.

Environmental Accounting for Our Environmental Conservation
Measures*1
The Company identiﬁes the costs and economic beneﬁts associated with environmental conservation
activities in accordance with policies stipulated in the "Environmental Accounting Guidelines" of Japan's
Ministry of the Environment, in order to assess the Fuyo Lease Group's environmental conservation
initiatives.
-: No applicable data is available.
×: Not recorded in the Environmental Accounting

Environmental
ReportEnvironmental
Philosophy/
Environmental
PolicyEnvironmental
Management
Fuyo Lease
Group Key
Environmental
Targets andResults
ClimateChangeInitiatives
Environmental
data
Environmental
Accounting

Social Report78Governance andManagement

Fiscal 2020
Environmental
preservation costs
Activity

Promotingresourcessaving andenergy saving
activities

Contributing
to thedevelopmentof a recycling
society

Establishinganenvironment
management
systemEconomic
eﬀects ofenvironmental
preservation
activities (tenthousand yen)

Investment(tenthousandyen)

Expenses(ten
thousandyen)"Reduction
in CO2emissions(tCO₂)*2"

Reduction
in volumeof wastedischarge(tonne)Introducing
energy-saving
equipment,
eco-friendly
oﬃce
activities, etc.

0

0

-141

-

-1,699Purchasing
green electric
power

×

0

0

-

×

Reducing use of paper forcopying and printing

×

×

-

37

5,162

Reducing fuel consumption
and exhaust emissions ofcompany cars

×

71

91

-

1,172

Establishing a prudent
administration system for the
disposal of goods no longer
leased

×

23,924*3-591*4

122,369

Acquiring, maintaining andexpanding ISO14001
Certiﬁcation by the Group

×

2,690

×

×

×

Providing environmental
education on a regular basis

×

×

×

Publishing information on
environmental activities
through CSR reports, etc.

×

×

×

Environmental objective

Reducing
electricity
use

Contributing to local
environmental education*5
Total

*1

Eﬀects of environmental
preservation

×

378

×

×

×

0

27,063-50

628

127,004

Data coverage: all domestic locations of Fuyo General Lease, Fuyo Auto Lease, Sharp Finance,
Accretive, INVOICE, FUJITA, Fuyo Network Service, Aqua Art, Fuyo Lease Sales, FGL Group
Business Service, and FGL Group Management Service.

*2CO2 emissions reduction is calculated using the CO2 emission factor stipulated in the "Ministerial
Ordinance on Reporting of Greenhouse Gas Emissions by Speciﬁed Emitters."(CO2 emissions from electricity are calculated using the actual CO2 emission factor for each ﬁscal
year of general power transmission and distribution business operators which supply electricity inareas where business operations and oﬃces that are included in the scope of calculations arelocated.)*3

Costs associated with reuse and recycling processes and costs associated with management ofindustrial waste disposal operators.

*4

The economic beneﬁts of reusing and recycling PCs and TFT-LCD panels.

*5

The costs required to donate (free rental) the interior aquarium ʻʼAQUA ARTʼʼ to local nurseryschools, etc. for environmental education.

79

Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assuranceDisclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

80

Top

> Sustainability> Social ReportSocial Report

Relationship with Customers

Sustainability

Improving
Customer
Satisfaction

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

Relationship with Shareholders
Concept ofIR

Communication
with Our
Shareholders
and Investors

Shareholder
Returns andStatus ofSharesRelationship with Regional Community
Approach toSocialContributions

Community
Engagement

Donation
Activities

Building a
BetterWorkplaceSocial Report

Relationship with
Customers
Improving
Customer
Satisfaction
Relationship with
Shareholders
Concept of IR
Communication
with Our
Shareholders
and Investors

Relationship with Employee
Respect for
Human
RightsEnvironmental
ReportHuman
Resource
Development
andRecruitment

PromotingDiversity

Employee
HealthManagement

Employee
Data

Shareholder
Returns andStatus ofSharesRelationship with
Regional
Community81Approach toSocialContributions
Community
Engagement
Donation
Activities
Relationship with
Employee
Respect for
Human
RightsHuman
Resource
Development
andRecruitment
PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

82Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

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83

Top

> Sustainability> Social Report> Improving Customer Satisfaction

Improving Customer Satisfaction

To improve customer satisfaction

Sustainability

The Fuyo Lease Group strives to provide services that can flexibly and promptly respond to the diverse
needs of customers by setting its Management Philosophy as "maintain customer's first philosophy,

Fuyo Lease
Group's CSV

providing best services."

Providing the FLOW data service, which
contributes to improving customers'
administrative efficiency
Fuyo Lease provides FLOW, a proprietary data service forSolving Social
Issues throughBusiness
Environmental
ReportSocial Reportmanaging lease contracts online as one of the services
that provide added value to customers.

Relationship with
Customers

FLOW has the advantage of improving the administrative
efficiency of online viewing and downloading of contract
information and accounting reference materials, and also completing contract termination procedures.
In addition, as a new service, we began offering the FLOW Cube+, a cloud-based fixed asset
management system, which enables customers to prepare financial statements which portray the actual
situation (physical asset management) while keeping customers' labor and costs down.
With the FLOW Cube+, we can respond to changes in taxation and accounting systems in fixed asset
management, and match information and accounting books of fixed assets that are needed forstrengthening internal controls, which contributes to improving the reliability of financial reporting.
We also respond promptly to the new lease standard of the International Financial ReportingStandard (IFRS), IFRS16, which is applicable from January 2019.

Improving
Customer
Satisfaction
Relationship with
Shareholders
Concept of IR
Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesFLOW Fuyo General Lease web service
FLOW Cube+ cloud-based general asset management service

Relationship with
Regional
Community84

Customer-Oriented Business Policy
Fuyo Lease is a Type II financial instruments business operator who invites its clients to participate as
investors in Japanese operating leases. We have established the Customer-Oriented Business Policy
based on the Principles for Customer-Oriented Business Conduct issued by the Financial Services Agency
in March 2017. Based on the Policy, we are committed to providing our clients with services in a sincere
and fair manner.

Responses to financial ADR system
The Financial ADR System (Alternative Dispute Resolution System in the area of finance) wasestablished in April 2010 to resolve financial issues quickly, flexibly, and conveniently. Under the System,
certain providers of financial services are obliged to conclude a basic contract with an institution on theperformance of procedures, if there is a designated dispute settlement institution, and to take grievanceand dispute resolution measures if there is no designated dispute settlement institution.
With regard to the money lending business, we concluded a basic contract on the performance ofprocedures with the designated dispute settlement institution, and took grievance and dispute resolution
measures for the Type 2 financial instruments business, which does not have a designated disputesettlement institution.

Approach toSocialContributions
Community
Engagement
Donation
Activities
Relationship with
Employee
Respect for
Human
RightsHuman
Resource
Development
andRecruitment
PromotingDiversity
Building a
BetterWorkplace

Please click here for details.

Employee
HealthManagement
Employee
Data

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

85

Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

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86

Top

> Sustainability> Social Report> Relationship with Shareholders> Concept of IR

Concept of IR

Basic Approach

Sustainability

Fuyo Lease has been listed on the First Section of the Tokyo Stock Exchange since December 2004 andstrives for timely, appropriate and fair disclosure of information to all stakeholders, including
shareholders and investors, in order to ensure the transparency of the management structure.
Fuyo Lease also provides a variety of opportunities and methods to actively communicate withshareholders and investors.

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

Disclosure Policy

Environmental
ReportFuyo Lease has set out its Disclosure Policy as the basic policy on the disclosure of information tofacilitate the accurate understanding and evaluation of the Company by stakeholders. The Disclosure

Social Report

Policy is published on the corporate website.

Relationship with
Customers

Disclosure Policy

Improving
Customer
Satisfaction
Relationship with
Shareholders
Concept of IR
Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesRelationship with
Regional
Community87Approach toSocialContributions
Community
Engagement
Donation
Activities
Relationship with
Employee
Respect for
Human
RightsHuman
Resource
Development
andRecruitment
PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

88Independent
assurance

BACK TO TOP

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved89with a total of 55 companies.
Top> Sustainability> Social Report> Relationship with Shareholders> Communication with Our Shareholders and Investors

Communication with Our Shareholders andInvestors

General Meeting of Shareholders

Sustainability

At Fuyo Lease, considering the convenience of our shareholders, we hold a general meeting ofshareholders early in order to avoid the day on which meetings are concentrated, as well as dispatch thenotice of convocation early and post it on our websites.Additionally, in order to enhance the convenienceof our shareholders in exercising their voting rights, we have made it possible for them to exercise therights on the Internet.
Because we take the view that the general meeting of shareholders is a place for communicating with
our shareholders, we aim for an open meeting, explaining reports in an easy-to-understand mannerusing images, charts, and tables.

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportBooklets containing the Report on Annual
Business Results and the Report on Interim
Business Results for shareholders
At Fuyo Lease, business activities are summarized in booklets containing the Report on Annual BusinessResults and the Report on Interim Business Results in an easy-to-understand manner. These booklets
are sent to our shareholders every half year.

Social Report

Relationship with
Customers
Improving
Customer
Satisfaction
Relationship with
Shareholders

Website IR Information

Concept of IR

At Fuyo Lease, we have established the IR Information page on our website to convey the latest IR
information in an easy-to-understand manner.
In addition, we also provide the IR information e-mail distribution service for free. Through this service,notifications to e-mail registrants is sent when the new IR information is posted online.

Financial results briefings
Fuyo Lease holds ﬁnancial results brieﬁngs for institutional investors and analysts twice a year in May
and November. We also have individual meetings with analysts. In ﬁscal 2020, we conducted
meetings with a total of 55 companies.

90

Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesRelationship with
Regional
Community
Approach toSocialContributions
Community
Engagement
Donation
Activities
Relationship with
Employee
Respect for
Human
RightsHuman
Resource
Development
andRecruitment
PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation91

Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

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92

Top

> Sustainability> Social Report> Relationship with Shareholders> Shareholder Returns and Status of Shares

Shareholder Returns and Status of Shares

Basic Policy on Shareholder Returns

Sustainability

The basic policy of the Fuyo Lease Group is to enhance shareholders' equity with the aim of reinforcing
the management base and financial structure, taking performance and management targets into
consideration, while striving for the long-term, stable return of profits to shareholders.
In response to constant support from our shareholders, Fuyo Lease has also introduced a shareholder
benefit plan with the aim of increasing the appeal of investing in the Company's shares and increasing
the number of long-term shareholders.

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportShareholder Benefit Plan
To implement the aforementioned goals for the introduction of the shareholder benefit plan, Fuyo Lease

Social Reportoffers rewards worth ¥3,000 for shareholders who have owned shares for less than two years and¥5,000 for those who have owned shares for at least two years in addition to a system that offers the
choice of book vouchers or catalog gifts as benefits.
Our Management Philosophy is to support "corporate activities through our leasing business with view tocontributing to development of the society". In order to contribute to development of the society
together with shareholders, we annually donate an amount equivalent to 10% of shareholder benefits toorganizations involved in social contribution activities.
The contributions made to date can be viewed on the following page.
Donation activities

Relationship with
Customers
Improving
Customer
Satisfaction
Relationship with
Shareholders
Concept of IR

Stock Information (As of March 31, 2021)

Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesNumber of shareholders: 16,080
Number of shares outstanding: 30,288 thousand shares

Relationship with
Regional
Community93Approach toSocialContributions
Community
Engagement
Donation
Activities
Relationship with
Employee
Respect for
Human
RightsBreakdown of Shareholders

Financial Institutions

Other domestic firms

Foreign Shareholders
Individuals and others(including treasury share)

Number of Shares
held(in thousands)

Number of
Shareholders

69

12,530164

10,588(treasury share included)

252

4,923

15,595

2,247

Human
Resource
Development
andRecruitment
PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

94Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

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> Sustainability> Social Report> Approach to Social Contributions

Approach to Social Contributions

Basic approach to social contributions

Sustainability

Recognizing close ties with our neighbors, the Fuyo Lease Group hopes to play the role of a good
corporate citizen who contributes to the development of local communities. Furthermore, based on our
corporate slogan of “Go where no one has gone before” and our management philosophy, we arefocused on creating shared value and solving social issues through our business operations, andcontributing to society as part of our business strategy.
Based on this approach, the Group has established a social contribution policy and is engaged in
activities that align with it. We identified the target areas for our social contribution activities based on
our social contribution policy to achieve synergies between the social contribution activities and our
Medium-term Management Plan. Our priority social contribution areas are “academic and research
activities” that support science and technology with commercialization potential in the New Domains,and “environmental activities” that help accelerate activities in the Energy and Environment areas. Bothare strategic areas of the Group's Medium-term Management Plan.

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportSocial Report

Relationship with
Customers

Social Contribution Policy (excerpt)

Improving
Customer
Satisfaction

Article 3 (Target areas for social contributions)
Engage in the following subject areas:

1.

Environment

2.

Contributions to local communities

3.

Academic activities and research4.

Support for areas affected by disasters

Relationship with
Shareholders
Concept of IR
Communication
with Our
Shareholders
and Investors

Article 4 (Implementation criteria)
Decide implementation according to the following criteria:

1.

Obtaining the understanding of society
Approaches that are highly public and receive a broad public understanding

2.

Using our characteristics
Approaches that use our know-how, products, and services

Shareholder
Returns andStatus ofSharesRelationship with
Regional
Community96

In addition, the Group's mission is to "seriously respond to customers' needs and provide solutions thatexceed their expectations." Because we believe that it is important for employees to gain awarenessabout regional issues and needs, we have introduced a volunteer leave system to promote social
contribution activities by employees. In fiscal 2020, no employees used volunteer leave as activities
were limited by the impact of the COVID-19 pandemic.

Approach toSocialContributions
Community
Engagement
Donation
Activities
Relationship with
Employee
Respect for
Human
RightsHuman
Resource
Development
andRecruitment
PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

97Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

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> Sustainability> Social Report> Community Engagement

Community Engagement

Recognizing close ties with its neighbors, the Fuyo Lease Group hopes to grow together with them,while being a good corporate citizen who contributes to the development of local communities. The

SustainabilityGroup has formulated a Social Contribution Policy and is conducting social contribution activities thatmake best use of its knowhow, products, and services focusing on the environment, community
engagement, academia and research, and assistance to disaster-affected areas.

Fuyo Lease
Group's CSV

Environmental and Community Engagement

Solving Social
Issues throughBusiness

Environmental Activities and Student Support by Aqua Art

Environmental
ReportAqua Art, a group company, provides decorative interiorSocial Reportaquariums for rent. Replicating a natural ecosystem in thesetanks promotes purification of the water and minimizes

Relationship with
Customers

water use. To also minimize the impact on the environment
and the ecosystem, fish and aquatic plants are procured
through aquaculture farms, and the company is also
working to breed these itself. As part of a biodiversity

Japanese rosy bitterling laying eggs

conservation project, in 2020 the company also succeededin breeding the Japanese rosy bitterling, a freshwater fish

Relationship with
Shareholders

endemic to Japan that has been designated as anendangered species.

Concept of IR

These aquariums also serve as a teaching tool that enables
people to learn about the mechanisms of the natural world.

Out of a wish to bring smiles and comfort to children with

Improving
Customer
Satisfaction

Children cheerfully responding
during a visiting lecture (FY2019)

these aquariums, Aqua Art donates (rents for free) them tonursery schools and maternal and child living support facilities, and also holds regular visiting lectures atfacilities to which aquariums have been donated, oﬀering children an opportunity to learn about theenvironment and ecosystem.
Fuyo Lease and Aqua Art also hold an annual aquarium design contest jointly with TOKYO DOME HOTEL

Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesCORPORATION. Students majoring in art and design at Tokyo Metropolitan Kogei High School and Tokyo
Designer Gakuin College, as well as students studying to become aquarists at TCA Tokyo College of ECO& Animals, design and decorate aquariums which are then exhibited at the entrance and lobby of theTokyo Dome Hotel. During the exhibition period, a contest is held in which visitors to the hotel vote for
their favorite.

99

Relationship with
Regional
Community

Participation in FIT Charity Run 2020
The Fuyo Lease Group has participated in the FIT Charity Run (Financial Industry in Tokyo For Charity
Run) every year since 2009.
The FIT Charity Run is a charity event aimed at supporting non-proﬁt organizations engaged incommunity-based activities. The event is organized by ﬁnancial service companies in Tokyo, which
gather and hold fund-raising activities.
The 16th FIT Charity Run 2020 was held online due to the impact of the COVID-19 pandemic. A total of
9 employees from the Group participated in the event through activities of running, walking or cycling.

Inviting the local community to Fukuoka PayPay DomeAt Fuyo Lease, we have purchased Philanthropy Seats of thebaseball stadium Fukuoka PayPay Dome and invited people

Community
Engagement
Donation
Activities
Relationship with
Employee
Respect for
Human
RightsHuman
Resource
Development
andRecruitment

from the community welfare facilities and young people insports since fiscal 2012.
With the purchased Philanthropy Seats, 20 seats reserved
per year on the first base infield side, audience members canwatch the full schedule of official games of Fukuoka Softbank

Approach toSocialContributions

Fukuoka PayPay Dome

Hawks.

PromotingDiversity
Building a
BetterWorkplace

Those who attended this activity have been very pleased andwe will continue to make use of these seats to maintainfriendships with local communities in the future.

The purchased Philanthropy Seats

Hosting internships for conveying the significance of work andproviding work experience to students who will be leading thenext generation

Employee
HealthManagement
Employee
Data

Governance andManagement

In order to convey the significance of work to undergraduate

Each Group
Company's
Environmental
and Social
initiatives

and graduate students who will be leading the next
generation, Fuyo Lease provides internships through which
the students can deepen their understanding of the leasing
business and experience actual work in the industry.

The eleventh internship program, held in ﬁscal 2020, wasGroup work session for interns

carried out over a period of six days in total between
December and January, with the participation of 95 students. The program consisted of a lecture on thebasics of leasing, as well as group work on creating contract documents and leasing. It also included an

Fundprocurement
through ESG
finance

informal gathering where students exchanged opinions with our staﬀ members on, for example, job
challenges and diﬀerences between students and professionals.
Students participating in the program made comments such as: "the program gave me an opportunity
to not only understand the leasing business but also to think about the meaning of work" and "thegroup work gave me an opportunity to listen to opinions that I would have never come up with, and it
was also useful to hear advice from HR." A similar internship program is scheduled for ﬁscal 2021.

100

Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

Contribution to academia and research
In October 2017, Fuyo Lease established Japan's first industry-academia collaborative GAP Fund incooperation with the Tokyo Institute of Technology and Innovations and Future Creation Inc.
In general, commercializing the results of university research requires additional costs outside ofresearch expenses, including the cost of additional testing, creation of prototypes and customer
interviews. However, since the research expenses and subsidies contributed by universities are limited toacademic purposes, there is a “GAP” in funding between basic research and commercialization. The GAPFund is intended to fill this funding gap and support commercialization of research results. Fuyo Lease
continues to provide funding for the GAP Fund, participate in the selection of eligible projects, andsupport the commercialization of advanced technology.

GAP FundA fund intended to fill the “GAP” to commercialization

Contributions to Culture and the Arts
In June 2021, we established the Fuyo-Joshibi Venus Fund with Joshibi University of Art and Design tosupport students aiming to become artists.
Students at art colleges who seek to enter society as artists, designers and creators need opportunities
for more people to learn about their work. Through ongoing funding provided to this fund over a periodof ten years, Fuyo Lease will purchase works created by students at Joshibi University of Art and Design,
while also working to provide numerous venues for the works to be exhibited by leveraging our
relationships with our customers and many other companies. By communicating these works to thewider world—works that until now had been held by individuals or limited to on-campus exhibits—we will
support these students in moving a step closer to their dreams.
Our goal is to contribute to the advancement of art and culture in Japan by actively supporting students
seeking to become artists through promotion of this fund, and by giving new art back to society.

101

Independent
assurance

Fuyo-Joshibi Venus Fund

Disclaimer

Disclosure Policy

Privacy policy

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> Sustainability> Social Report> Donation Activities

Donation Activities

Actual donations (unit: ten thousand yen)

Sustainability

Fuyo Lease makes annual donations to organizations working in disaster-affected areas, humanitarianassistance, the environment, cultural arts and academic research. In fiscal 2020, we mainly provided
donations to support areas affected by disasters related to torrential rains, to children affected by the
COVID-19 pandemic, and to academic research.

FY 2016

FY 2017

FY 2018

FY 2019

FY 2020

1,096

563

1,127

1,040

575

Disaster-affectedarea support andHumanitarian
AssistanceFuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportEnvironment

50

50

50

50

50

Cultural Arts andAcademicResearch

123

125

625

1,275

230

Other

18

42

4

2

1

Total

1,287

780

1,806

2,367

856

Social Report

Relationship with
Customers
Improving
Customer
Satisfaction
Relationship with
Shareholders
Concept of IR

Activities of Fuyo Heartful Fund 100
Within the Fuyo Lease Group, we established the Fuyo Heartful Fund 100 in November 2010 for
employees to contribute to society through donations. Directors, officers and employees who join thefund donate 100 yen a month, 300 yen for directors and officers, from their salaries as donation funds.
The accumulated funds are donated to groups that develop activities including in the areas ofenvironmental conservation, local community contribution, academic and research support and support
for areas affected by disasters.

Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesRelationship with
Regional
Community103

In fiscal 2020, we donated a total of \600,000 as donations

Approach toSocialContributionsof ¥150,000 to 4 projects in Japan and overseas related to
COVID-19 countermeasures and prevention of child abuse.

Community
Engagement
Donation
Activities
Relationship with
Employee

Donation Activities by Shareholder Benefit
Plan
Fuyo Lease annually donates an amount equivalent to 10% of shareholder benefits to organizations
involved in social contribution activities.
In fiscal 2020, we donated ¥2.85 million each to the support fund for disaster volunteer and NPO
activities (Donations for disasters, including torrential rain from July 3, 2020) and the "Save the Children

Respect for
Human
RightsHuman
Resource
Development
andRecruitment

Children's New Coronavirus Emergency Assistance Activities" at Save the Children Japan.

PromotingDiversity

Actual donations

Building a
BetterWorkplace

Fiscal year

Fiscal 2011

Amount(yen)

Donation recipient (outline of donation)

Japanese Red Cross Society (Great East Japan

Employee
HealthManagement

2,594,500

Employee
Data

Earthquake/donation for disaster area)

Fiscal 2012

Central Community Chest of Japan (Great East Japan
Earthquake/support for volunteer and NPO activities)

2,959,600

Governance andManagement

4,233,900

Fiscal 2013

Japan Association of Corporate Executives IPPO IPPONIPPON Project Phase 5(Great East Japan Earthquake/provision of learning
equipment to affected senior high schools)

Each Group
Company's
Environmental
and Social
initiatives

Japan Association of Corporate Executives IPPO IPPONIPPON Project Phase 7(Great East Japan Earthquake/provision of learning
equipment to affected senior high schools)

2,249,550

Japanese Red Cross Society(2014 West Africa Ebola Relief Fund)

2,249,550

Fiscal 2014

Total

4,499,100Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

104

Fiscal year

Fiscal 2015

Amount(yen)

Donation recipient (outline of donation)

Japan Association of Corporate Executives IPPO IPPONIPPON Project Phase 9(Great East Japan Earthquake/provision of learning
equipment to affected senior high schools)

2,561,900

Central Community Chest of Japan(Donations for disasters, including torrential rain due to2,561,900

Tropical Storm Etau in 2015)

Total

Fiscal 2016

5,123,800

Kumamoto City
(Kumamoto earthquake/Kumamoto Castle disasterrecovery assistance fund)2,615,800

Japanese Red Cross Society(Middle East Humanitarian Crisis Relief Fund)

2,615,800

Total

5,231,600

2,815,850

Kumamoto City
(Kumamoto earthquake/Kumamoto Castle disasterrecovery assistance fund)Fiscal 2017

Save the Children Japan (Save the Children Children's

2,815,850

Fund)

Total

5,631,700

Central Community Chest of Japan (Donations fordisasters due to Typhoon Jebi in 2018 and Hokkaido
Eastern Iburi Earthquake/support fund for disastervolunteer and NPO activities)

2,535,700

Save the Children Japan (Save the Children Children's
Fund)

2,535,700

Fiscal 2018

Total

Fiscal 2019

5,071,400

Central Community Chest of Japan (Donations fordisasters due to Typhoon Hagibis in 2019/support fundfor disaster volunteer and NPO activities)

2,176,200

Save the Children Japan (Save the Children Children'sFund)

2,176,200

Association of Para-Sports Promotion in Japan (APSPJ)

1,200,000

105

Independent
assurance

Fiscal year

Amount(yen)

Donation recipient (outline of donation)

Total

Central Community Chest of Japan (Donations for

5,552,400

2,850,450

disasters, including torrential rain from July 3,
2020/support fund for disaster volunteer and NPO
activities)

Fiscal 2020

Save the Children Japan (New Coronavirus Emergency

2,850,450

Assistance Activities)
Please see here (external site) for details

Total

Disclaimer

Disclosure Policy

Privacy policy

5,700,900

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> Sustainability> Social Report> Relationship with Employee> Respect for Human Rights

Respect for Human Rights

Basic Approach

Sustainability

The Fuyo Lease Group encourages respect for human rights in accordance with international norms suchas the Universal Declaration of Human Rights, and we have listed Respect for Human Rights in the Fuyo
General Lease Group Code of Corporate Conduct. We have stipulated that we will act with respect forthe dignity and basic human rights of all people and build a corporate culture with respect for humanrights at its core. In achieving this goal, we implement initiatives aimed at encouraging respect forhuman rights, with reference to the United Nations Guiding Principles on Business and Human Rights
and other sources.
Moreover, based on a recognition that particular consideration is required for the human rights ofchildren, the Fuyo Lease Group has endorsed the international norms in The Children's Rights andBusiness Principles of UNICEF and works to protect and advance the rights of children who may be
involved in its business.

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportSocial Report

We actively encourage our employees and business partners to have a better understanding of theGroup's human rights policy.
Specifically, the Fuyo Lease Group's Human Resources Division provides instruction and support to all
departments and offices as well as group companies on planning, proposal and promotion of basic
human resource policies and procedures, including education and awareness raising regarding humanrights, and also reports to the Executive Committee on the results of implementation.
Furthermore, Fuyo Lease's Corporate Planning Division regularly assesses the Group's risk management
status, including human rights issues, and reports it to the directors. If significant risks occur these arereported to the Risk Management Officer and to the Executive Committee.
Furthermore, we regularly check the progress of human rights initiatives and report to the Risk
Management Officer and the Executive Committee when significant risks occur.

Expectations toward respecting human rights
for stakeholders
The Fuyo Lease Group respects the human rights of stakeholders in its business (board members andemployees, business partners, suppliers, partner companies in each business, local communities, etc.)
and conducts initiatives. Expectations for key stakeholders are as follows:107

Relationship with
Customers
Improving
Customer
Satisfaction
Relationship with
Shareholders
Concept of IR
Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesRelationship with
Regional
Community

Board Members andEmployees

harassment on the basis of gender, nationality, race, ethnicity,

Approach toSocialContributions

religion, disability, or any other grounds. We strive to create awork environment where each and every employee respects eachother's human rights and can work in comfort and with peace ofCommunity
Engagement

The Group has zero tolerance for all forms of discrimination and

mind.

Partners

Our management philosophy is to "maintain customers first
philosophy, providing the best services." We will not only preventand mitigate negative impacts on human rights related to theprovision of services, but also strive to respect the human rights ofall our business partners.

Suppliers

We expect suppliers providing services with our Group to
understand the basic concept of human rights, and respect humanrights in the same way as Group employees.

Initiatives to Assess and Mitigate Human
Rights Risks
The Fuyo Lease Group works to prevent negative impacts on human rights in its business and provide
access to remedy.

Board Members and Employees
In the Group, the Audit Office and Human Resources Division conduct regular employee interviews inorder to prevent violations of human rights.
We have also established mechanisms to ensure more reliably that impacts on human rights arecontrolled, including conducting checks each time when there are changes to the structure of new

Donation
Activities
Relationship with
Employee
Respect for
Human
RightsHuman
Resource
Development
andRecruitment
PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement

projects. If any human rights issue arises in relation to the Fuyo Lease Group's businesses, a team leadby the Human Resources Division will promptly resolve it.
In addition, we have set up internal and external whistleblower hotlines that allow anonymous reportingand guarantee that all reports will be treated as confidential in order to promptly detect any
infringements of compliance or the Code of Corporate Conduct in the area of human rights, including

Each Group
Company's
Environmental
and Social
initiatives

bullying and harassment.
In fiscal 2020, three reports were received through the hotlines. In each report, investigations arepromptly conducted, such as confirming the facts with the parties concerned with due care to protect
whistleblowers against detrimental treatment and taking appropriate measures. All cases have been
resolved, and measures put in place to prevent recurrences.

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation

Partners
Recognizing that it is possible that the Group could contribute to a negative impact on human rights inproviding services, we strive to take appropriate measures to prevent or mitigate any negative impacts
on human rights that may occur through our business activities. In particular, we focus on protecting

108

Editorial Policy

the privacy of our business partners, building an information management system according to thebusiness content, and strictly managing our partners’ information

Independent
assurance

Information security initiatives are here

Human Rights Awareness Training
The Fuyo Lease Group continually provides human rights awareness training in its grade-specifictraining, which includes that for new employees and newly appointed assistant managers/section chiefs
with the aim of creating workplaces with a fundamental respect for human rights. We have also
distributed the Code of Corporate Conduct mini-booklet to all employees to raise awareness of the Fuyo
Lease Group's approach to human rights and labor and the importance of respecting them. In fiscal
2018, the Group introduced a new training program for all employees, in which the participants view
videos to improve their human rights awareness.
Furthermore, we provide training upon promotion for employees appointed at or above a certain level ofmanagement position to enable them to respond appropriately when there are reports of incidents andconsultations involving human rights, including bullying and harassment.

Building Positive Employer-Labor Relations
The Fuyo Lease Group recognizes freedom of association and collective bargaining rights as the rights of
its employees. While complying with laws and regulations and promoting these rights, we strive forappropriate communication between employers and employees. In Fuyo Lease, the percentage of
employees who belong to a labor union is 63.6%.

Promoting Appropriate Labor Standards
The Fuyo Lease Group strives to comply with domestic and foreign laws and regulations on labor
standards where its offices are located, such as working hours and pay but also to make the working
environment even better in order to ensure consideration for human rights. Not only do we strive tolimit long working hours and guarantee a living wage in our offices in Japan, but we also carry out
checks at our overseas sites as necessary, in addition to paying living wages that exceed the minimum
stipulated by local laws and regulations, to maintain high standards to ensure the retention of excellent
employees. Each month, we report the company’s overall status of working hours and any workers who
are working long hours to the director in charge of the Human Resources Division and the President &CEO and deliberate on countermeasures when necessary. In addition, as an initiative to reduce long
working hours at domestic group companies, we are actively implementing measures to prevent
overwork and have introduced “Refresh Day (no overtime day)”, “+ Friday (leave-work-early system)”,and the “interval system” for employees to use freely.
In Fuyo Lease in fiscal 2020, there were no infringements of labor-related laws and regulations.

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> Sustainability> Social Report> Relationship with Employee> Human Resource Development and Recruitment

Human Resource Development and Recruitment

Basic Approach

Sustainability

The Fuyo Lease Group believes that employees are our greatest asset. We also believe it is important torespect each individual and their personalities, and to enable them to grow through their jobs and leadrich, full lives, both mentally and physically while feeling their work is satisfying and has meaning.
As we encourage the growth of each individual employee, maximizing their talents and capabilities, thisin turn allows us to simultaneously enhance corporate value and create social value, which we believe
will lead to sustainable growth for the Group.
The Group expects its employees to each think individually and act proactively on their own, to be eager
to grow and independent. In addition, we will work to create better work environment, including
diversity, that supports our employees' growth and thus enhances corporate value, while also focusing

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
Reporton human resource development.
Furthermore, with the extensive branch network of Fuyo Lease Group in Japan and overseas, Fuyo

Social Report

Lease is promoting local employment and personnel recruitment in an effort to respect the culture in

Relationship with
Customers

each local area, strengthen networks and create jobs.

Expanding businesses and providing fair andimpartial evaluations
As the Fuyo Lease Group moves into uncharted businesses and continues to expand its frontiers, asdeclared in the core principles of the current Medium-term Management Plan, Frontier Expansion 2021,
the roles our employees play and the tasks and challenges they face are becoming more diverse andcomplex. For this reason, we have made changes to our human resources system in July 2019 toexpand business domains and perform fair and impartial evaluations. The core concept of the newhuman resources system is to convert a job function or ability-based system where a generalist serves
as a role model into a varied, multi-track, job duty-based system, and to provide a framework whichenables employees to achieve personal development and to expand the scope of their duties in the longterm. In addition to changing the job description of clerical track to administrative track, the system also
has been changed to encourage employees not only to aspire to be a section manager, who had been

Improving
Customer
Satisfaction
Relationship with
Shareholders
Concept of IR
Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesserved as role models, but also to strive for even higher positions such as departmental manager. We
encourage employees to independently develop their career plans and we make efforts to offer themrewards that commensurate with the roles they play and the duties they perform in their respective
areas.

110

Relationship with
Regional
CommunityImplement of employee satisfaction survey
We have been conducting an employee satisfaction survey since fiscal 2018 to make work more
rewarding and to help employees work in a positive way each day. In fiscal 2020, a total of 2,096
employees from twelve group companies in Japan participated in the survey with a 95.2% response
rate. Employee satisfaction surveys are conducted annually while expanding the number of target
employees as we aim to create a rewarding workplace where every employee can work with motivation.
Questions are divided into satisfaction with the workplace, job satisfaction, and work-life balance,

Approach toSocialContributions
Community
Engagement
Donation
Activities

among others, and are evaluated on a 5-point scale. After conducting the survey, we aggregate andanalyze the responses by department and by gender, and use the results to expand our systems for
improving on comfortable working environments and for personnel measures.

Respect for
Human
RightsResults of employee satisfaction survey

Number of employees who
answered the survey

Job satisfaction**

Relationship with
Employee

FY 2018

FY 2019

FY 2020

Domestic 8

Domestic 10

Domestic 12

groupcompanies,
1,490

group
companies,
1,714

group
companies,
2,096

employees

employees

employees

87.3％

85.8%

85.4％

Percentage of employees who rated at least one out of six job satisfaction questions as four orabove (on a scale of one to five) in the Employee Satisfaction Survey.

Human Resource Development

Human
Resource
Development
andRecruitment
PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement

Developing autonomous human resources
As the needs of our customers gradually change, diversify and become more sophisticated, each of ouremployees is expected to "think for themselves and make the right choices" on the spot in order toachieve the mission assigned to them.

Each Group
Company's
Environmental
and Social
initiatives

We believe learning the correct fundamentals, as well as practical on-the-job training (OJT), are thefoundation of cultivating this ability to "think for oneself and make the right choices." We thus offergroup training across a wide range of employee levels in laws, taxes and accounting, finance, financial
analysis, product knowledge and thought-based business skills. We also emphasize each employee's
efforts to pursue professionalism and take the initiative to develop their own abilities, and offer a varied
menu of support for self-improvement. Our "+ Friday Seminars*," newly established in fiscal 2021,
cover a wide range of topics, including the latest business information, general education and health,and aim to promote a habit among employees, regardless of age or position, of using their free time tolearn for themselves. In addition, in cases where the COVID-19 pandemic makes it difficult to holdgroup training, we have created an environment where employees can continue to enjoy opportunities
to learn via online training and on-demand viewing of training videos. In fiscal 2020, the average
number of hours of education and training spent on each employee was 30.3 hours.

111

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy*"+Friday Seminars," which are seminars held at irregular intervals on Friday afternoons, provide
opportunities to learn during the time created by "+Friday," in which employees select one Friday at
random each month to work only for the morning and then go home early.

Click here for a more detailed explanation of our educational system

Since fiscal 2017, the Fuyo Lease Group has been jointly
conducting business skill training, focused on training for new
recruits, career training, and management. Based on theidea of "pursue group synergies" that we have stated in theMedium-term Management Plan, this training serves as anopportunity to help share understanding of each company's
business and culture.
A total of 350 group company employees took part in 10
training programs in fiscal 2020.

Young employees working on
tasks given by the training
program.
(During group training,they wear masks and keep theirdistance to participate in the
training.)

Initiatives to strengthen guidance anddevelopment
In the second half of fiscal 2019, we also introduced coaching training for management-level employees,
designed to strengthen guidance and development in cultivating the ability to "think, judge and act on
one's own," and, as an organization, to pass on human resource development practices to the next
generation. Those who have completed a six-month cycle of training and practice are granted ourinternal coaching qualification. In addition to teaching, we encourage the growth of each employee
through coaching and development, as we aim to create an organization that maximizes diverse talents
and capabilities.

Self-assessment system
Fuyo Lease has a self-assessment system in place for promoting the autonomous and continuous
development of employees' skills. Once every year, individual employees submit a Self-assessment andCareer Development form for declaring to the Company a list of abilities they have managed to improve,
whether they have managed to expand the scope of their jobs, what kind of self-development efforts
they are making and what areas of experience they would like to build upon for their own development.
The Company uses information on the declaration form to understand each employee's plan for careerdevelopment, and reflects it in its personnel measures.
Furthermore, the Company provides feedback to each employee on their current progress while
attending various seminars in an effort to encourage employees to actively make use of various self112

Independent
assurance

development programs.

Internal recruitment system

A trainee dispatched to New York,
United States (at that time)

A trainee dispatched to China(at that time)

Fuyo Lease has a Trainee System and Internal Recruitment System in place for supporting active careerdevelopment. Furthermore, we introduced and launched the Job Posting System in fiscal 2018, and the
Job FA System in fiscal 2021 to give employees the chance to take on the challenge of doing a job thatinterests them.
The Trainee System is being applied in the overseas trainees' program and also the training programs ofvarious departments such as credit decisions making and aircraft leasing departments.
Every year, the Company dispatches about nine overseas trainees per year to its Group companies in the
US and Hong Kong, as well as the overseas branches of financial institutions. As a result, by getting
involved in their day-to-day operations locally, the Company aims to increase the level of the trainees'
basic knowledge and linguistic abilities to engage in international financial transactions. At the Company,
we have set Overseas as one of its strategic areas in the Medium-term Management Plan, and areworking to expand the real estate leasing and environment and energy businesses in collaboration withour business partners and strengthen our overseas networks. In addition, by establishing trainee
systems for operations that are indispensable to each business, we expect that businesses will bestrengthened by human resources who have experience using those systems.
The Job Posting System was introduced as a framework for providing opportunities for each employee todevelop by autonomously enhancing their knowledge and skills. In the system, the Company has job
posts it offers, such as for department/branch manager, president of affiliated companies, specializedbusiness departments, and credit departments.
The "Job FA System" basically allows employees who meet certain conditions to transfer to thedepartment of their choice. This system was introduced with a view to maintain high levels of
motivation.

Course transfer system
In order to respond to the diversifying needs of employees in relation to employment and skill
development, Fuyo Lease has the Course Transfer System in place, which allows them to switch fromadministrative to generalist career tracks, or vice versa. Between April 2011 and July 2021, 13
employees were transferred to their new career track taking advantage of this system.

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Full-time employee challenge system
In April 2014, in order to further develop skills and expand the job scope of highly capable andmotivated contract employees, Fuyo Lease introduced a new system of hiring contract employees
meeting certain requirements as full-time employees.
Between the introduction of the system and April 2021, a total of twelve contract employees had been
hired as full-time employees, and are working in the field of administration or sales administration.

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Top

> Sustainability> Social Report> Relationship with Employee> Promoting Diversity

Promoting Diversity
Basic approach

Sustainability

The Fuyo Lease Group believes that diversity is a key growth driver. Bringing together different
strengths, viewpoints and values generates the innovation that creates new value, and leads tosustainable growth for the Group. To accomplish that, we are working to promote diversity with the goalof creating a workplace where every employee can maximize their full potential, regardless of age, sex,
nationality, sexual orientation, gender identity, race, ethnicity or disability.

Empowering female employees in theworkplace

Fuyo Lease
Group's CSV
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Issues throughBusiness
Environmental
ReportSocial Report

Relationship with
Customers
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Customer
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Concept of IR

Towards creating a workplace environment wherefemale employees can exercise their abilities andparticipate more than ever:～Preparing and promoting an action plan for promoting
the participation of female employees in the workplace～

115

Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesRelationship with
Regional
Community

Given a background of a shrinking productive workforce and the need to respond to diversifying market
needs, the Group considers empowering women in the workplace to be a particularly importantmanagement priority. To secure talented human resources, we have worked on measures to promoteroles for women aimed at creating an environment in which, more than ever, women can demonstrate
their abilities and play an active role. Under our action plan launched in fiscal 2020, based on the
Women's Advancement Promotion Law, we have set new targets—including "a ratio of female
employees hired of 40% or more," and "a ratio of female employees in management positions of 30%
or more"—and have begun a variety of measures aimed at achieving them. Specifically, we are moving
forward with initiatives that strongly support women's advancement, including an expansion of seminars
at women's colleges and efforts to promote follow-up with women in managerial career track positions.
To encourage women to elevate their careers, we are also providing more opportunities for them tointeract with a diversity of role models, including by holding informal exchanges with executives anddivision heads and career lectures and dialogues with female business leaders, as we work to nurture
this culture.
Outline of General Employers Action Plan

Target period

April 1, 2020 through March 31, 2022 (2 years)

I. Provision of work opportunities for female workers
Ratio of new female employees hired: 40% or more
Ratio of female employees in management positions: 30% or more

Goals

II. Establishment of a work environment that contributes positively
to both the working and family lives of employees
Annual paid leave utilization rate: 80% or more
Telework system utilization rate: 40% or more

1.

Expand internships for female students and seminars at
women's colleges, and promote follow-up with women in
managerial career track positions

2.

List of activities

3.

Provide opportunities for exchanges between corporate
officers, female general managers, and female employees ofkey career track and candidates
Provide individual consultations and skills development
opportunities for senior leaders and leader-class employees
who are at the central level among operational staff

4.

Introduce hourly leave system and actively promote use ofhalf-day leave system

5.

Fully implement telework, examine the introduction of
flextime to support telework, and expand satellite offices

Increasing the recruitment of female new graduates: outline offemale employees' work-styles
In the course of fiscal 2020 recruitment activities, the Company revised its recruitment website in orderto facilitate students to visualize what it is like for female employees to work at Fuyo Lease. The revised
website introduce the Company's female employees working in various functions, explain the scope ofApproach toSocialContributions
Community
Engagement
Donation
Activities
Relationship with
Employee
Respect for
Human
RightsHuman
Resource
Development
andRecruitment
PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation

their jobs and careers, and how they are managing their work and child care. Furthermore, in order tocommunicate more with female students, the Company set up booths at events for female students.

116

Editorial Policy

Conducting a three-party interview to support the career plan ofeach female employee
The Company regularly conducts a three-party interview for the purpose of supporting women's careerplans in which each female employee is interviewed by her departmental manager and a staff member
from Human Resources Division. Individual career plans are designed based on issues and a future
vision for supporting each individual's development. Furthermore, in order to appoint female managers,
the Company provides support for enhancing their abilities and skills through training by organizing
opportunities for female employees to attend external seminars on subjects such as management skills
and leadership.

Career Lectures for awareness of female employees andmanagers
We hold career lectures by inviting external lecturers as an opportunity for female employees to think
about and design their future careers. Since 2017, the target audience of the lectures has no longer
been limited to female employees, and lectures have been held with the aim of creating a work
environment where diverse employees can realize their potential. In January 2019, an Ikuboss*
Seminar was organized for management-level staff. From fiscal 2020, we have been holding career
seminars by female executives and providing opportunities to encounter a variety of careers and workvalues.
*Ikuboss: A leader who supports their staff's professional and personal development, and achieves
good business performance, as well as enjoys their work and personal lives.

Theme and content of lecture
CareerLecture

Date

Theme

February 2015

What it means for women tocontinue working: thinking about
their future careers

2nd Lecture

July 2015

Creating a comfortable workplace

3rd Lecture

January 2017

Diversity and time management

4th Lecture

January 2019

Ikuboss seminar

5th Lecture

February 2021

1st Seminars by female executives

6th Lecture

September 2021

2nd Seminars by female executives

1st Lecture

Working group activities toward creating a better workplace(Everyone Active Working Group)

117

Independent
assuranceSince January 2015, we are continuously running aworking group for employees with the aim of creating aworkplace that is more welcoming for employees to get
actively involved in, and allows them to envision theircareers over the medium and long term. In fact, several
programs have been established through the discussions.
For example, a program called +Friday (Plus Friday) introduced in February 2017 is one of them, whichallows employees to choose one Friday each month when they work just a half day. Flexible hours
program introduced in May 2017 is another program that was born out of the working group's
discussions. This program offers four different work schedules with earlier and later starting andfinishing times, in addition to the normal working hours, so that employees can choose the schedulethat is most suitable to their needs, for activities such as childcare or family nursing care duties, as wellas their lifestyles.
Through discussion and consideration by employee-participation-type working group activities, we are
striving to penetrate and establish systems to create better working environments.

PeriodTheme

1stBalancing workwith childcare

Content

Formulation of the Action Plan: Stage 6 for
the Next Generation Act
Creation and distribution of guidebooks for
empowering women in the workplace
Consideration of measures to improve thepercentage of male employees who takechildcare leaveThe
recruitment of
women

2nd

Promotingmale
employees totake childcare
leave
Awarenessraisingetc.

3rd

Flexible
operation ofworking hours
Balancing workwith nursing
care

Revision of public relations tools for recruiting
women in new graduate recruitment
Consideration of measures to promote male
employees taking childcare leave
Initiatives for internal penetration andestablishment of female empowerment in theworkplace
Consideration of measures for the Action
Plan: Stage 6 "Implementation of Initiatives
that Contribute to Reviewing Work Styles"
based on the Next Generation Act

Consideration of "+ Friday" concept andnaming
Implementation of Flexible hours program
Organizing and considering issues toward therealization of independent and active working
styles118

Period

Theme

Content

Promotion of
independent

4th

and active
working styles
Considerationof work-lifebalancesupport andorganizational

Discussion of work style systems currently
being tested, examined, and implemented by
the General Affairs Department
Consideration of specific measures to improve
efficiency and productivity
Welfare systemculture reform
measures

5th

Activation ofcommunication

Consideration of measures to activate
communication across departments

Promotion of
independent

Consideration of meeting efficiency that
contributes to work style reform

and active
working styles

6rh

etc.

Activation of

Discussion of issues to work autonomously

communicationand improve the rate of taking paid leave

Building a
rewarding
workplace

Activation of communication areas at newhead office, consideration of events, etc.

Handout on creating a workplacethat considers everyone's needs(a partial excerpt) created by the

Leaflet giving information on thechildcare support system(excerpt)

second working groupChildcare Support Guidebook
created by the first working
group

Employing people with disabilities
We are also working to hire people with disabilities.
In addition to the longstanding recruitment of mid-career employees, the Company has started
recruiting new graduates since fiscal 2015. In recruiting people with disabilities, the Company decides,with considerations to the characteristics of their disabilities and the jobs they want, the sections andjobs where they are to be assigned after joining the Company, as well as their working hours. The

119

company also makes efforts to improve and consider the working environment to ensure they can fulfill
their potential.
As of the end of fiscal 2020, the percentage of people with disabilities employed by Fuyo Lease was 2.4
percent.

Elderly employment (reemployment after
retirement)
In response to the enactment of the revised Act for Stabilization of Employment of Older Persons in April
2013, Fuyo Lease reviewed the past continuous employment system and introduced a revised system,
which allows, in principle, all employees who are reaching retirement age to continue working until theage of 65 if they wish.
As of the end of fiscal 2020, there were 31 employees still employed after retirement. Using theirknowledge and experience acquired over many years, they are working in the functions of, for example,
debt collection, making credit decisions, and remarketing leased properties.

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> Sustainability> Social Report> Relationship with Employee> Building a Better Workplace

Building a Better Workplace

Basic Approach

Sustainability

The Fuyo Lease Group believes that creating a work environment in which employees can be healthy,safe and can work with energy and enthusiasm leads to a more vital, productive organization. We are
striving to build a better working environment where all employees can find their own optimal work-lifebalance and enhance the quality of both life and work by maintaining and improving their health,gaining new knowledge and experiences and attaining personal growth. In addition, we believe thatinvesting in the health of our employees—efforts to maintain and improve their health—is an investment
in human capital on par with investing in education.
In addition to providing support for childcare and nursing care, we have been implementing work-stylereforms across our corporate group since fiscal 2014. We are making ambitious efforts in accordancewith Next-Generation Training Support Action Plan: Stage 7.
In fiscal 2020 we also introduced a hourly based annual leave and established rules for telecommuting

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportSocial Reportto allow for even more flexible work styles, as we advanced efforts to meet the needs of the times.

Relationship with
Customers

Next-Generation Training Support Action
Plan: Stage 7 (April 2017 - March 2022)
For each employee to independently and actively review workstyles tailored to their individual lifestyles,
and with the aim of creating a work environment and corporate culture that enables employees tobalance work and family while maintaining job satisfaction and a challenging spirit, we have formulated
an action plan as follows. At present, in the latter half of the Action Plan: Stage 7, efforts are being
made to achieve our numerical targets. A variety of work-styles are becoming more well-known throughtheir active use in various programs, leading to the realization of a self-sustained work-life balance.

Description
Promoting independent and active working styles
Encouraging male employees to take a more active role in parenting

Improving
Customer
Satisfaction
Relationship with
Shareholders
Concept of IR
Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesReducing total working hours

Relationship with
Regional
Community

Offering diverse career path options

121

Numerical targets
FY
2017

FY
2018

FY
2019

FY
2020

FY 2021targetRate oftakingannual paid
leave

68.0%

68.4%

66.3%

72.0%

80% or more

Rate of male
employees
who takechildcareleave etc.

90.0%

90.5%

85.7%

78.6%

80% or more

Donation
Activities
Relationship with
Employee

Human
Resource
Development
andRecruitment

As programs to support childcare and nursing care for our employees, etc., we have established thefollowing to promote understanding in the workplace and the active utilization of these programs.

Program contents

Maternity leave

A program that allows female employees to take a leaveof six weeks before childbirth and eight weeks afterchildbirth

Spousal childbirth leave

A program that allows male employees to take threedays of paid leave when their spouses give birthParental leave

Community
Engagement

Respect for
Human
RightsMain Programs and Benefits

Name

Approach toSocialContributions

A program that allows employees to take five days ofleave (however, a maximum of ten days of leave can betaken for childcare leave that starts within eight weeksof the child's birth) when taking childcare leave

Nursing leave

A program that allows employees to take leave when
they need to take care of preschool children (five days
per child per business year)

Nursing care leave

A program that allows employees to take up to five daysof leave per business year for each family member who
is in need of nursing care

Shortened working hours program

A program to allow for shortened working hours for
employees until the end of their child’s third year ofelementary school

Flexible hours program

A program that allows employees to choose from fivedifferent working-hour schedules to match theirlifestyles

122

PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

Name

Return-to-work program

Program contents

A program that assists people who want to return towork after leaving due to reasons such as marriage,
pregnancy, childbirth, childcare, transfer of spouse, or
nursing a family member

Telework program

A program that allows employees who want to use
teleworking may work from home or a locationequivalent to home if they receive permission from theirsupervisor

Initiatives to Support Childcare
Since the Act on Advancement of Measures to Support Raising NextGeneration Children went into effect in 2005, we have been working tocreate a better job environment for working parents by developing a“general employer action plan” as required by the law.
As a result, we achieved our action plan based on the Act on
Advancement of Measures to Support Raising Next-Generation Children.
In addition, following fiscal 2007, fiscal 2009, fiscal 2011, fiscal 2013,

Platinum Kurumin markand fiscal 2015, in fiscal 2017, we received our sixth “general business owner conforming to standards”
certification from the Tokyo Labour Bureau, and obtained the six-star mark of the Next-Generation
Certification (the Kurumin mark) from the Ministry of Health, Labour and Welfare as a company working
to support balancing work and family life.
Also, in fiscal 2017, we received the special Platinum Kurumin certification, an accreditation that is given
to companies that have achieved a higher level of commitment among other Kurumin-certified
companies.
In fiscal 2018, we held an Ikuboss Seminar and strove to change mindsets through our participation in
the Ikuboss Corporate Alliance and by having management-level staff take part in the Ikuboss
Declaration. As a result, 90% of male employees took childcare leave, and 19 of the 21 employees
whose spouses gave birth had taken leave, achieving the 80% or more target set in Next-Generation
Training Support Action Plan: Stage 7. In fiscal 2019, we revised a number of regulations to make iteasier for male employees to take childcare leave, and in fiscal 2020, we will make it mandatory formale employees to take childcare leave. We are making these and other efforts to actively promote theparticipation of male employees in childcare while also aiming to further increase the rate of paid
paternity leave.

Employee's comment: Mitsuhiro Uekusa, Business Planning &Promotion Division"I used childcare-related programs, and now I’m
putting a lot of effort into raising my child."
123

Independent
assurance

I took two special leaves of absence vacations, firsttaking spousal childbirth leave when my wife gavebirth, and then taking childcare leave when she
returned home after giving birth in her hometown.
The company encourages male employees to takechildcare leave, and thanks to the understanding of mysuperiors and colleagues, I was able to devote myself
to childcare with peace of mind while on leave. Thereis also a program to receive childcare goods as a gift
I am doing my best to care for myfirstchild with my wife.

to celebrate the birth of a new child, and this makes
me feel like the company supports employees raisingchildren. In the future, I would like to continue to take advantage of programs such as
flexible hours to work efficiently while also valuing the time that I spend with my family.

Initiatives to Support Nursing Care
In January 2018, we held a Nursing care seminar to dispel concerns about nursing care, which is
expected to affect many employees in the future. At the seminar, over 170 employees learned aboutbalancing work and nursing care. We also provide various types of information on nursing care andsupport employees who are being confronted with nursing care.

Promoting Work-Style Reforms
Refresh Day
In fiscal 2021, we continued to hold Refresh Day (no overtime day) once a week. Employees are free tochoose any day of the week as their Refresh Day.

+Friday
To encourage each individual employee to review their workstyle, from February 2017 we introduced
the +Friday program, where employees can select one Friday of each month to work only for themorning then go home early. A total of 84.8 percent of employees take advantage of this program,which is intended to help them work better and acquire knowledge and experience outside theworkplace. We aim to create an environment that encourages employees to come up with a variety ofideas for their work.

Employee's comment: Yuko Hoshino, ICT Solution Business
Division"It's a good opportunity to separate work and private
life."
124

I use the time freed up by +Friday as an opportunity
to go and see a movie, a favorite pastime of mine,and to go out with my husband, who has days off on
weekdays. In the past, I struggled with balancing
work and housekeeping, but by being able to secure
free time even once a month, I feel I can have some
downtime and it also increases my motivation to workfrom the next week. In the future, I would like to takeadvantage of this program, not only for my hobbies
I'm using the afternoon to refresh myself.

but also for lessons on cultural activities.

Flexible Hours Program
We have established a new program that encourages a shift to an autonomous and active work-style byallowing employees to use their own discretion in managing time and work. Depending on their lifestyle,and not only for reasons such as childcare and nursing care, the Staggered Hours Program lets us selectfrom among four work patterns that advance or postpone when we start and end work outside of thenormal working hours. This, along with the Discretionary Labor Program, was introduced andimplemented from May 2017.

Employee's comment: Keijiro Miyazono, Real Estate Planning
Division"Using the program, I havemore time to spend with mychildren."With the Staggered Hours Program, I chose to start
work at 9:30 a.m., which is 30 minutes later than theregular starting time. I use the time in the morning tohave breakfast with my children and prepare them for
I can now spend time with my children
on weekdays as well.

nursery school. Because my wife is also working, I
hope to share housekeeping and childcare

responsibilities as much as possible. But, until now, I had felt sorry to have to leave
everything on weekday mornings to my wife. Because I have been able to take charge of themorning childcare due to flexible attendance, my wife is also very pleased. In addition, by
having more time to spend with my children, I am also happy that I can experience mydaughter growing up gradually day by day.

Employee's comment: Yuki Nukui, Corporate Business Division II"I can now use time in a way that suits my lifestyle."
125With the Flexible Hours Program, I chose a work
pattern to start working at 8:30 a.m., which is 30
minutes earlier than the regular starting time, and I
leave work at 4:50 p.m. Because I leave work 30
minutes early, I use the time to take lessons at an
English conversation school using the personal
development support program, in order to study for
qualifications, and to practice golf, which is my hobby.
As a result, the time after work is being used better
Time to study a foreign language andfor acquiring a qualification has become
available every day

than before. Because working hours have become
uneven, I feel that not only the people who use thisprogram benefit, but also others benefit from a spreading company-wide awareness offinishing work exactly at a fixed time and going home.

Increased paid leave take-up rate
We have been encouraging employees to take their annual paid leave (annual holidays), such as byestablishing a system in fiscal 2011 that encourages taking consecutive days of leave in summer andwinter. From fiscal 2016, we introduced the Five-day Consecutive Annual Leave system, aiming at
improving the rate at which career-track employees take leave, because they have particularly low rates
of taking annual leave. As a result, the annual leave take-up rate was 72.0% in fiscal 2020. We aim toattain an annual leave taking rate of 70% or more, which is the target of the Action Plan: Stage 7 (fromthe period of April 2017 to March 2022) pursuant to Act on Advancement of Measures to Support
Raising Next-Generation Children.
Furthermore, in the final fiscal year of the Medium-term Management Plan (fiscal 2021), we have beenpromoting “bridge holiday,” by encouraging employees to use a day of leave in situations where one or
two working days are bracketed by a weekend and a national holiday, in order to increase opportunities
for taking four or five day breaks in order to achieve a balanced approach to work and time off, and will
work toward achieving a rate of 80% or more.

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> Sustainability> Social Report> Relationship with Employee> Employee Health Management

Employee Health Management

Health Declaration

Sustainability

The Fuyo Lease Group believes that the mental and physical health of employees and their families is
the source of their fulfillment and wellbeing. We believe that it leads to their growth as responsible
resolvers of social issues.
Based on this thinking, we have presented our Health Declaration, stating that we will strongly promote
activities to maintain and increase the health of employees and their families, and the Group is working
together as one to engage in health and productivity management.

1.

The Fuyo Lease Group recognizes that employees are its greatest asset, and that their health andthat of their families is important.

2.

Employees also recognize that their health and that of their families is irreplaceable and willproactively work to maintain and increase their own health.

3.

The Company will continuously support these initiatives by employees and provide comfortable
work environments.

4.

With the participation of employees who are healthy and work with energy and enthusiasm, theGroup will aim to resolve social issues and realize a better society.

The Fuyo Lease Group's Health and Productivity Management
SystemFuyo Lease
Group's CSV
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Issues throughBusiness
Environmental
ReportSocial Report

Relationship with
Customers
Improving
Customer
Satisfaction
Relationship with
Shareholders
Concept of IR
Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesRelationship with
Regional
Community127

Health Committee
Fuyo Lease believes that creating a working environment where employees can work healthily, safely,and energetically will revitalize the company and lead to improved productivity.
Based on this idea, the Health Committee, set up under the Industrial Safety and Health Act, meetsonce a month to maintain and improve the health and safety standards of the workplace. The HealthCommittee consists of health and safety managers from each department, division managers, andApproach toSocialContributions
Community
Engagement
Donation
Activities

occupatinal physicians. The Committee is responsible for identifying issues concerning health and safety
at the Fuyo Lease Group, planning as well as implementing measures, and verifying the results of thosemeasures.

Relationship with
Employee
Respect for
Human
RightsHealth examination
Health examinations for employees are held once a year. The general periodic health examination takerate for fiscal 2020 was 100%.

Human
Resource
Development
andRecruitment
PromotingDiversity

Mental health care
Fuyo Lease has been conducting stress checks since 2010, in order to maintain and improve employees'
mental health. With mandatory stress checks, the implementation system and method were discussed
again this year by the Health Committee. Since establishing internal regulations, we have been carryingout activities with six affiliated companies since 2021.
Employees receive stress checks on the Web and, after about a month, they can check the results ofevaluations given by occupational physicians, who are the implementers of the Web check. When doing
so, we encourage employees who have been assessed to be highly stressed to have a medical interview
with an occupational physician, and take necessary work-related measures based on the results of theinterview.
In addition to stress checks stipulated in the Industrial Safety and Health Act, employees and their

Building a
BetterWorkplace
Employee
HealthManagement
Employee
Data

Governance andManagement

families can consult specialist counselors. The results are not disclosed to the company, because we
consider the privacy protection needs of individuals.

Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

128Independent
assurance

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> Sustainability> Social Report> Relationship with Employee> Employee Data

Employee Data

Employee Data

Sustainability

Fuyo Lease Group consolidated data

Fuyo Lease
Group's CSV

Number of employees (persons)

Number of
employees

End
of FY
2014

End
of FY
2015

End
of FY
2016

End
of FY
2017

End
of FY
2018

End
of FY
2019

End
of FY
2020

1,542

1,559

1,703

1,715

1,960

2,416

2,637

Solving Social
Issues throughBusiness
Environmental
ReportSocial Report

Fuyo Lease non-consolidated data
Number of employees (persons)
End of FY 2016

End of FY 2017

End of FY 2018

End of FY 2019

End of FY 2020

Male

Female

Total

Male

Female

Total

Male

Female

Total

Male

Female

Total

Male

Female

Total

Generalist track

467

40

507

458

53

511

459

63

522

456

85

541

469

104

573

Administrative
track

0

152

152

0

149

149

1

155

156

1

138

139

2

137

139

Temporaryemployees

26

4

30

24

5

29

20

6

26

28

7

35

38

9

47

Total

493

196

689

482

207

689

480

224

704

485

230

715

509

250

759

130

Number of new graduates employed (persons)Relationship with
Customers

FY ofjoining
Fuyo
Lease

FY
2014

FY
2015

FY
2016

FY
2017

FY
2018

FY
2019

FY
2020

FY
2021

Total

19

26

28

31

35

29

45

38

Relationship with
Shareholders

Male

13

19

20

18

20

18

27

18

Concept of IR

Female

6

7

8

13

15

11

18

20

Number of new graduates employed (persons) and retention rate after 3 years (%)
FY of joining
Fuyo Lease

FY
2012

FY
2013

FY
2014

FY
2015

FY
2016

FY
2017

FY
2018

Generalist
track

17

16

16

26

22

29

27

Administrative
track

1

0

3

0

6

2

6

Total

18

16

19

26

28

31

33

Retention rateof employees
3 years after
joining Fuyo
Lease

94.4

87.5

94.7

100

85.7

100

94.3
☑

Improving
Customer
Satisfaction

Communication
with Our
Shareholders
and Investors
Shareholder
Returns andStatus ofSharesRelationship with
Regional
Community
Approach toSocialContributions
Community
Engagement
Donation
Activities

Relationship with
Employee*

A checkmark ☑ indicates that ﬁscal 2018 ﬁgures have been assured by KPMG AZSA Sustainability
Co., Ltd.

Respect for
Human
RightsIndependent assurance

Human
Resource
Development
andRecruitment

Number of employees leaving (persons)/reasons for leave/turnover rate (%)
FY
2014

FY
2015

FY
2016

FY
2017

FY
2018

FY
2019

FY
2020

Generalist
track

4

5

6

11

13

10

12

Administrative
track

4

1

1

3

2

4

2

131

PromotingDiversity
Building a
BetterWorkplace
Employee
HealthManagement

*

FY
2014

FY
2015

FY
2016

FY
2017

FY
2018

FY
2019

FY
2020

Total

8

6

7

14

15

14

14

Voluntary
resignation

5

3

6

9

14

11

11

Mandatory
retirement

0

2

1

2

1

2

1

Other

3

1

0

3

0

1

2

Turnover rate

1.1

0.8

1.0

1.9

1.9

1.8

1.7 ☑

The turnover rate includes voluntary resignations, mandatory retirement and other reasons forleaving (e.g. relocation). It does not include employees who have been re-employed on acontractual basis leaving at the end of their contracts.

Employee
Data

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
ﬁnanceParticipation in
Initiatives andThird-Party
Evaluation
Editorial Policy

Average age (age)/average length of service (years)/average salary (thousandyen)/Rate of paid leave taken (%)*

Independent
assurance

End
of FY
2014

End
of FY
2015

End
of FY
2016

End
of FY
2017

End
of FY
2018

End
of FY
2019

End
of FY
2020

Age

41.9

41.7

41.5

41.4

41.2

41.3

41.4

Length ofservice

16.3

16.6

16.4

14.7

14.6

14.8

14.5

Annualsalary

8,293

8,366

8,410

8,454

8,669

8,833

8,675

Rate ofpaid leave
taken

58.5

61.9

68.9

68.0

68.4

66.3*

72.0
☑

Due to restrictions on the number of employees coming to work in conjunction with the spread of
COVID-19, actual data on paid leave for eight Fuyo General Lease (USA) Inc. employees is notincluded.

132

Number of female managers and assistant female managers (persons) / rate (%)

End
of FY
2014

End
of FY
2015

End
of FY
2016

End
of FY
2017

End
of FY
2018

End of
FY
2019*

End
of FY
2020

Femalemanagers

25

27

29

32

36

79

114 ☑

Percentage
of femalemanagers

8.1%

9.0%

9.1%

9.9%

11.5%

19.6%

25.1%
☑

* In July 2019, our human resources system was revised to classify senior leaders (a position
equivalent to the position of section chief, of which there were 40 as of the end of fiscal 2019)as managers. As a result, the number of female managers and the ratio of female managers
increased year on year.

Total employee training hours (hours) / Average training hours per employee (hours)

FY
2014

FY
2015

FY
2016

FY
2017

FY
2018

FY
2019

FY
2020

Total
employeetraining
hours(hours)

9,900

13,921

16,10918,093

19,11819,937

19,809Averagetraining
hours peremployee(hours)

18.9

25.6

29.2

31.2

31.9

32.6

30.3

Number of trainees sent overseas (persons)

Number of
employees
sentoverseas

FY
2014

FY
2015

FY
2016

FY
2017

FY
2018

FY
2019

FY
2020

3

5

5

8

8

9

3

133

Number of employees who used the career track shift system (persons)

Numberof users

Apr.
2015

Apr.
2016

Apr.
2017

Apr.
2018

Apr.
2019

Apr.
2020

Apr.
2021

2

1

1

1

0

2

6

Number of employees converted from contractors to full-time employees under the
Full-time employee challenge system (persons)
Apr.
2015

Apr.
2016

Apr.
2017

Apr.
2018

Apr.
2019

Apr.
2020

Apr.
2021

4

1

0

3

1

0

3

FY
2014

FY
2015

FY
2016

FY
2017

FY
2018

FY
2019

FY
2020

Number of
femaleemployees
who takechildcareleave(persons)

8

9

10

4

3

6

1

Percentage
of female
employees
who takechildcareleave (%)

100

100

100

100

100

100

100

Number ofmale
employees
who takechildcareleave(persons)

0

11

11

7

19

12

11

Percentage
of maleemployees
who takechildcareleave (%)

0.0

47.8

52.4

43.8

90.5

85.7

78.6

Numberof users

Other employee data

134

FY
2014

FY
2015

FY
2016

FY
2017

FY
2018

FY
2019

FY
2020

Rate ofemployees
receiving
regularmedicalcheck-ups
(%)*1

99.8

97.5

99.0

97.5

98.4

98.4

100

Employment
rate of thedisabled
(%)

2.0

1.8

2.2

2.3

2.3

2.1

2.4 ☑

Number ofindustrial
accidents(number ofcases)*2

2

2

1

1

2

4

2

*1

Regularly provided medical check-ups are categorized into general medical examination for
employees of less than 35 years of age, medical examination for adult diseases for employees
between 35 years of age and less than 40 years of age, and comprehensive medical examinationfor employees of 40 years of age or above.

*2

Accidental injuries due to falling in the street while commuting, all of which are minor injuries.

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Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

135

Top

> Sustainability> Governance and Management

Governance and Management

Corporate GovernanceRisk Management andCompliance System

Code of Corporate
Conduct

Information Security

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportSocial Report
Governance andManagement

Corporate
Governance
Code ofCorporate
Conduct
Risk
Management
andCompliance
SystemInformation
Security

Each Group
Company's
Environmental
and Social
initiatives

136

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

137

Top

> Sustainability> Governance and Management> Corporate GovernanceCorporate Governance

Basic Idea and Structure

Sustainability

The Fuyo Lease Group places strong emphasis on creating and maintaining relationships with all
stakeholders, including shareholders, customers, employees, and local communities. We believe that thefundamental objective of corporate governance is to perform business activities with sincerity andfairness in line with our management philosophy.
To achieve sustainable growth and increase corporate value over the medium to long term, we haveestablished our own Corporate Governance Guidelines which align with the purpose and spirit of theJapan's Corporate Governance Code. These Guidelines serve as the foundation for our corporate
governance framework, operating policies and other management policies, to which we adhere to
everything we do.

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportCorporate Governance Structure

Social Report

Fuyo Lease has established a Board of Corporate Auditors, which includes two outside corporate

Governance andManagement

auditors who are independent from our company. In addition, in order to enhance the supervisory
function of the Board of Directors, we have also appointed four independent outside directors, whoprovide oversight and advice on the execution of business operations from an external perspective.

Corporate Governance Structure

Corporate
Governance
Code ofCorporate
Conduct
Risk
Management
andCompliance
SystemInformation
Security

Each Group
Company's
Environmental
and Social
initiatives

138

Furthermore, to improve management efficiency and expedite decision-making by separating themanagement oversight function from the execution of operations, we have adopted the executive officer
system.
For further details, please refer to: Fuyo Lease Group Report on Corporate Governance (PDF)

Report on Corporate GovernanceParticipation in
Initiatives andThird-Party
Evaluation（562KB）

Strengthening Corporate GovernanceFuyo Lease has implemented various initiatives aimed at strengthening corporate governance.

Year

2008

Initiative

Objective

Introduced performance-based

To strengthen links between

compensation and stockcompensation-type stock options

directors' remuneration and theirperformance and shareholder value

2011

Reduced the term of office of adirector from two years to one year

To increase opportunities to build
shareholder confidence

2015

Increased the number of

To strengthen the management

independent outside directors from
one to two

oversight structure

Established the Corporate
Governance Guidelines

To comply with the JapaneseCorporate Governance CodeSet up the Nomination andCompensation Advisory Committee

To ensure independence andobjectivity in the decision-making
process for matters such as
nomination and compensation

2016

Started analyzing and evaluating
the overall effectiveness of theBoard of Directors

To verify the effectiveness of theroles and functions of the Board of
Directors and to make ongoing
improvements

2018

Increased the number of
independent outside directors fromtwo to three

To strengthen the management
oversight structure

Introduced a stock

To strengthen links among thecompensation plan (Board
Beneﬁt Trust, BBT)

directors' remuneration,
shareholder value, andachievement status of the

The base index for calculationof performance-based
compensation was changed to
key performance indicators for
the Medium-termManagement Plan (operating
assets, ordinary proﬁt, andMedium-term Management
Plan
To comply with the revised
Japanʼs Corporate Governance
Code

ROA on a consolidated basis)
Revised Corporate Governance
Guidelines

Fundprocurement
through ESG
finance139

Editorial Policy
Independent
assurance

2019

2021

Released an English version of
the Corporate Governance
ReportTo enhance external disclosure
related to corporate
governanceBegan reporting annualinternal audit results andannual plans and policies tothe Board of Directors

To expand reporting lines forinternal audits

Increased the number of
independent outside directors fromthree to four

To strengthen the management
oversight structure

Establishment of the Corporate Governance Guidelines
In conformity with the purpose and spirit of the Japanese Corporate Governance Code, Fuyo Lease has
established our own Corporate Governance Guidelines, which provide a foundation for corporate
governance framework, operating policies, etc. The Corporate Governance Guidelines set out theframework, operating policies, roles, and responsibilities of different supervisory and executivefunctions, in addition to our basic approach to corporate governance. To achieve sustainable growth andincrease our corporate value over the medium to long term, we adhere to these guidelines in everything
we do across the Fuyo Lease Group.
For further details, please refer to: Corporate Governance Guidelines (PDF)
Corporate Governance Guidelines（194KB）

Board of Directors
The Board of Directors consists of ten directors, including six internal directors and four independent
outside directors, with independent outside directors accounting for more than 1/3 of the Board of
Directors. The Board of Directors deliberates and makes decisions on important management issues, aswell as matters specified in laws and regulations, the Articles of Incorporation, and the Regulations
governing the Board of Directors. The Board of Directors also oversees the execution of operations by
Directors and Executive Officers.
In fiscal 2020, the Board of Directors met 12 times.

140

Nomination and Compensation Advisory Committee
Fuyo Lease has set up the Nomination and Compensation Advisory Committee as an advisory body of
the Board of Directors in order to eliminate arbitrariness in decision-making processes and to maintain ahighly transparent management structure. The committee consists of five members, including four
independent outside directors and an internal director. The committee mainly deliberates on topics suchas nominating or removing of candidates for directors and corporate auditors, remuneration of directors,
succession planning, and analysis and evaluations of the overall effectiveness of the Board of Directors,
and reports its findings to the Board of Directors.
In fiscal 2020, the Nomination and Compensation Advisory Committee met twice.

Board of Corporate Auditors
Our Board of Corporate Auditors is composed of four auditors, including two full-time and two part-time
auditors who are also independent outside corporate auditors.
According to the audit plan formulated by the Board of Corporate Auditors, each corporate auditor
audits execution of operations by directors by attending important meetings, reviewing important
documents, examining operations and assets, and reviewing the audit findings of the independentaccounting auditor and the internal audit department among other relevant activities. Corporate
auditors closely work with the Internal Audit and Internal Control Departments to conduct audits inorder to enhance audit quality. At the request of the corporate auditors, an employee (a staff member
from the Group Internal Audit Division) has been appointed to assist them.
In fiscal 2020, the Board of Corporate Auditors met 11 times.

Attendance at Board and Committee meetings (attendance in FY 2020 by board
members, as of June 23, 2021)

Name

Attendance at Board
meetings

PositionTakashi Sato

Director and Chairman

Board of Directors: 12/12

Yasunori Tsujita

President and Chief
Executive Officer(Representative Director),
Chairman of the Nomination
and Compensation Advisory
Committee

Shozo Kazama

Director and Deputy
President (Representative
Director)

Board of Directors: 12/12

Hiroaki Oda

Director and Deputy
President (Representative
Director)-(Elected in June 23, 2021)

Soichi Hosoi

Senior Managing Director

Board of Directors: 12/12

Board of Directors: 12/12
Nomination andCompensation Advisory
Committee: 2/2

141

Keiji Takada

Senior Managing Director

Board of Directors: 10/10(Elected in June 23, 2020)

Seiichi Isshiki

Director (Independent
Outside Director),
Member of the Nomination
and Compensation Advisory

Board of Directors: 12/12
Nomination andCompensation Advisory
Committee: 2/2

Committee

Hideo Ichikawa

Director (Independent
Outside Director),
Member of the Nomination
and Compensation Advisory

Board of Directors: 12/12
Nomination andCompensation Advisory
Committee: 2/2

Committee

Masayuki Yamamura

Director (Independent
Outside Director),
Member of the Nomination

Board of Directors: 12/12
Nomination andCompensation Advisory

and Compensation Advisory
Committee

Committee: 2/2

Hiroko Matsumoto

Director (Independent
Outside Director),
Member of the Nomination
and Compensation Advisory
Committee-(Elected in June 23, 2021)

Shigeru Suda

Full-time Audit & Supervisory
Board Member

Board of Directors: 12/12
Board of Corporate
Auditors: 11/11

Yoshito Tsuruta

Full-time Audit & Supervisory
Board Member

Board of Directors: 10/10
Board of Corporate
Auditors: 8/8(Elected in June 23, 2020)

Takashi Yonekawa

Outside Audit & Supervisory
Board Member(Independent Director)-(Elected in June 23, 2021)

Hiroshi Imoto

Outside Audit & Supervisory
Board Member(Independent Director)-(Elected in June 23, 2021)

Executive Committee
The Executive Committee is composed of Executive Officers with positions of Managing Executive Officer
or higher, the heads of the Corporate Planning Division, Human Resources Division, and Business
Planning & Promotion Division as well as the presidents of affiliated companies. Full-time corporate
auditors also attend meetings of the Committee on a regular basis.

142

As a general rule, the Executive Committee meets at least once a month to make decisions on operating
activities and implementation of measures delegated to the President & CEO, and to discuss important
issues concerning internal controls. Its aim is to improve the quality of management decisions and to
speed up decision-making.
In fiscal 2020, the Executive Committee met 18 times.

Compliance Committee
Fuyo Lease has set up a Compliance Committee chaired by the Chief Compliance Officer and vicechaired by the Group Legal and Compliance Division Officer. The heads of relevant planning andadministrative departments, the heads of relevant departments of domestic and overseas subsidiaries
serve as full-time committee members, and outside lawyers serve as outside members. The Compliance
Committee meets quarterly to discuss issues related to compliance systems and implementing annualcompliance plans. Based on its discussions the Committee submits reports to the Board of Directors andthe Executive Committee, and takes measures to develop and enhance compliance systems.

Internal Audit
The internal audit function is administered by the Group Internal Audit Division (staffed by ten
employees). The Group Internal Audit Division conducts operational audits of all departments, offices,branch offices, and major subsidiaries, and plays a part in ensuring that internal controls are functioningin addition to examining their effectiveness. The results of these audits of operations are reported to the
President & CEO and corporate auditors every time they are conducted and periodically to the Board of
Directors and the Executive Committee.

Analysis and Evaluation of the Effectiveness of the Board of Directors
At Fuyo Lease, we analyze and evaluate the overall effectiveness of the Board of Directors every year.
The Board of Directors makes further efforts to enhance its functions in the light of the results of theanalysis and evaluation with the aim of continually improving its effectiveness.
The results of the analysis and evaluation for fiscal 2020 are as follows.

Evaluation process (corporate lawyer assists the secretariat)

Assessment Criteria
We administer surveys about the Board of Directors in general, with 25 questions covering 5 categories:
1) structure of the Board, 2) role of the Board, 3) how the Board runs, 4) support system for outside
directors, and 5) overview. There is a “remarks” column for each question so that respondents can voice
their opinions freely.

Results143

While the Board of Directors met all evaluation criteria, including size, composition, functions and roles,
as well as operation, and was found to be effective, we concluded that we must still steadily implement
measures to improve the functions of the Board of Directors, make those activities part of our daily
operations, and continually review the Board's functions.

Progress on Issues identified last fiscal year

Analysis and Assessment for last fiscal year (i)Revitalization of discussions at Board meetings: We decided to enhance the content of discussions
on progress reports relating to the Medium-term Management Plan by business area by including
reports on group companies. We also began reporting on the risk management capital status andproviding more detailed Executive Committee minutes to outside directors so that they could
experience the discussions as if they had attended.

Analysis and Assessment for last fiscal year (ii)
Further reflection of the perspectives of CSV and environment, social, and governance (ESG): We
established the CSV Promotion Committee and made arrangements for it to report the results ofdiscussions to the Board of Directors from the first half of fiscal 2021. We also explained to outside
directors the Group’s progress with CSV management to share awareness.

Analysis and Assessment for last fiscal year (iii)
Further improvement of information provided to outside directors: In addition to keeping outside
directors informed of the impact of COVID-19 on our business, we have set up a system forreceiving questions on matters of interest to outside directors, provide answers at appropriate times
and offer third-party workshop opportunities to outside directors.

Newly identified issues
These include further improvement of the diversity, specialist knowledge, and oversight functions ofmembers of the Board of Directors, deepening CSV management on a group basis, and further
improvement of information provided to outside directors.

Director Qualifications and Nomination Procedures

1. Policy and procedures for nominating director and corporate auditor candidates andremoving directors
Our Corporate Governance Guidelines set forth procedures for nominating and removing directors in
addition to the qualifications of corporate auditors and procedures for nominating corporate auditor
candidates. Under these guidelines, a director or corporate auditor candidate must possess an
outstanding personality, a wide breadth of knowledge, abilities, experience, and high ethical standards.
The guidelines also specify that candidates be nominated regardless of factors such as sex, age, andnationality, with the aim of achieving greater diversity. In order to ensure fairness and transparency inthe nomination process, the selection of candidates for directors and corporate auditors is finalized by
the Board of Directors following a discussion by the Nomination and Compensation Advisory Committee,
which is comprised of majority independent outside directors. Selection of corporate auditor candidates
is finalized by the Board of Directors upon consent of the Board of Corporate Auditors.

2. Independence standards for outside directors and outside corporate auditors
144

Independence standards for outside directors and outside corporate auditors are stipulated in the
Corporate Governance Guidelines in line with the independence standards prescribed in the Guidelines
Concerning Listing Management, etc. established by the Tokyo Stock Exchange.

3. Roles expected of outside directors and outside corporate auditors and reasons forappointment

Name

Seiichi Isshiki

Reason for appointment

In addition to serving as Representative Director &President of JX Nippon Oil & Energy Corporation, Mr.
Isshiki has served as a director of JX Holdings, Inc. andpresident of ENEOS Celltech Co., Ltd. We believe that his
abundant experience and deep insight will provide aperspective that is independent of management and willcontribute to enhancing the effectiveness of the decisionmaking and oversight functions of the Board of Directors.

Hideo Ichikawa

We believe that his many years of management experience
as representative director and president, chief executive
officer, representative director and chairman of the board,
director, chairman of the board of Showa Denko K.K. andhis abundant experience and deep insight will provide aperspective that is independent of management and willcontribute to enhancing the effectiveness of the decisionmaking and oversight functions of the Board of Directors.

Masayuki Yamamura

We believe that his experience as representative director
and president of NTT East and chairman of theincorporated association and his abundant experience anddeep insight will provide a perspective that is independentof management and will contribute to enhancing theeffectiveness of the decision-making and oversightfunctions of the Board of Directors.

Hiroko Matsumoto

We believe that her experience as after working for
Toshiba Corporation, school administration and education
as Administrator, Vice President, Professor and Head of
Research Institute of Joshibi University of Art and Designand her abundant experience and deep insight will provide
a perspective that is independent of management and willcontribute to enhancing the effectiveness of the decisionmaking and oversight functions of the Board of Directors.

Takashi Yonekawa

To utilize the abundant experience and high insight that hehas served as a Director and Managing Executive Officer,
Vice-President and Executive Officer of Sompo Japan
Insurance Inc., to carry out appropriate audits from an
independent and objective standpoint.

Hiroshi Imoto

By making use of Mr. Imoto’s abundant experience andhigh level of insight as a member of the Japan Bank forInternational Cooperation’s International Management andPlanning Division, Industry Finance Department, and Fulltime Corporate Auditor, to carry out appropriate audits
from an independent and objective standpoint.

145

Board Remuneration
The Board of Directors of Fuyo Lease has passed a resolution on the Company’s policy regarding how todetermine individual remuneration, etc. for directors. Fuyo Lease believes that enhancing the link
between shareholder value and remuneration of Board of Directors will boost their morale and motivatethem to improve our financial performance and share price, leading us towards our goals of ensuring
stable performance and growth, while enhancing our corporate value. That is why we have introduced
variable pay programs such as performance-based compensation and stock compensation in addition toa base salary, which is provided as fixed compensation.
We determine base salaries in the light of our employees' salaries, average market salaries for directors,
our financial standing, and other relevant factors.
The actual amount of performance-based compensation is based on our consolidated performance aswell as an individual director’s contribution to our financial performance among other factors. The
indicators for performance-based compensation are operating assets, ordinary profit, and ROA on aconsolidated basis, which are key performance indicators for the Medium-term Management Plan. As
resolved by the Board of Directors, the President & Chief Executive Officer is delegated to determine
details regarding the amounts and timing of performance-based compensation.

Method for calculating performance-based compensation
Performance-based compensation = base salary for each position x performance-based payment
coefficient (*)*

The performance-based payment coefficient is determined through a formula that combines theattainment percentage of the previously set targets and the year-over-year change percentage for:1) operating assets, 2) ordinary profit, and 3) ROA. The performance-based payment coefficient
ranges between 0.5 and 1.5.

The stock compensation plan (Board Benefit Trust, BBT) is designed to motivate Board members to help
boost our company's performance and corporate value over the medium- to long-term by making thelink between their compensation and our equity value clearer. Under this compensation plan, theCompany's shares are acquired by a trust using funds contributed by the Company, and the directors
will be provided, on their retirement, with the Company's shares and cash-equivalents to the market
price of the Company's shares (in lieu of the provision of the Company’s shares, an amount equivalent
to the market value of the Company’s shares for a specified proportion, if the requirements specified in“Regulations for Provision of Shares to Officers” are met) in accordance with the Regulations for
Provision of Shares to Officers approved by the Board of Directors.
The ratio between the base salary and the variable pay plan is set at 1 to 0.6 based on the averagecompensation ratio used by listed companies. The variable pay plan consists of performance-based
compensation and stock compensation, and the ratio between the two is set at 5 to 7 in the light of thecharacteristics of the revenue structure of the leasing business to provide higher incentives on a
medium- to long-term basis.
Directors' compensation is discussed by the Nomination and Compensation Advisory Committee in orderto ensure transparency and objectivity in determining the amounts. Compensation for outside directors
and corporate auditors consists only of fixed compensation because performance-based compensationand equity compensation are not really applicable.
The company prescribes malus provisions providing that if a director causes significant damage to theCompany or engages in inappropriate conduct, the director's base salary or performance-based

146

compensation will be reduced or the director will not be paid and the director will no longer be eligible toreceive stock compensation.

Board Remunerations (Fiscal 2020)

Breakdown of remunerations (millions of yen)Totalamount(millionsof yen)Basicremuneration

Performancelinked
remuneration

Nonmonetary
remuneration

Directors

324

208

48

66

9

(Outside

(36)

(36)

(-)

(-)

3

66

66

-

-

5

(21)

(21)

(-)

(-)

2

Directorclassification

Numberofdirectors

Directors)

Board ofCorporate
Auditors
members(Outside
Auditors)*

The above performance-linked remuneration comprises the amount, which shall be recorded infiscal 2020.

*

Non-monetary remuneration is a stock benefit trust (BBT). The amount of the BBT comprises theamount recorded in the fiscal year based on the number of points granted or expected to be
granted during the fiscal year.

*

At the 39th Annual General Meeting held on June 25, 2008, Fuyo Lease approved the resolution to
pay accrued retirement benefits associated with the abolishment of the retirement benefits systemfor directors. The estimated amount as of the end of the fiscal year is 4 million yen (outside
directors). The payment is made at the time of their retirement.

Internal Control System
Fuyo Lease has instituted an internal control system across our corporate group to ensure compliancewith all relevant laws and the articles of incorporation, capability to respond to various risks in a timely
and appropriate manner, and to ensure transparency and efficiency of operations, in addition to ensuring
the reliability of financial reports, etc.
Our Internal Audit Department, corporate auditors, and independent auditor share information aboutaudit findings to monitor the status and operation of the internal control system. The status of theinternal control system operation is reported to the Board of Directors during a meeting held at the endof each fiscal year, and continuous improvements are made in the light of the audit findings.

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Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

148

Top

> Sustainability> Governance and Management> Code of Corporate Conduct

Code of Corporate Conduct

Chapter 1 Basic Policy of Fuyo General Lease
Group
1. Social Responsibilities and Public Missions
Always bearing in mind the significance of our social responsibilities and public missions, wecommit ourselves to sound business management based on the principle of self-responsibility as afinancial business group that consists mainly of listed companies.
We endeavor to communicate closely with society, and to align our corporate conduct with social
norms.

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportWe have considerable social responsibilities and public missions as a financial business group thatconsists mainly of listed companies. We must be aware that we are required to fulfill both our social
responsibilities and public missions, and the purpose of a private company at a high level.
First of all, we are expected to take social responsibilities, including economic, legal, ethical, and social

Social Report
Governance andManagement

contribution responsibilities, as follows;
Economic responsibilities such as pursuing reasonable profits, securing employment and efficientmanagement;
Legal responsibilities to comply with laws and regulations as a member of society;
Ethical responsibilities to respect human rights and act in line with social norms; andSocial contribution responsibilities as a good corporate citizen that supports and grows withsociety.

To fulfill these social responsibilities and public missions, it is essential to gain the unwavering trust of
our customers and society through the Group's sound and appropriate business operations.
While great effort and time are required to gain the trust of our customers, that trust can be lost in an
instant. A financial business group's loss of trust can lead to a reduction of trust in the entire financial

Corporate
Governance
Code ofCorporate
Conduct
Risk
Management
andCompliance
SystemInformation
Security

system.
We declare that we always bear in mind the significance of our social responsibilities and public
missions, and commit ourselves to sound business management based on the principle of selfresponsibility. Furthermore, through activities such as public relations activities, we endeavor to actively

149

Each Group
Company's
Environmental
and Social
initiatives

communicate with society at all times, and to ensure that our activities are fair and transparent in linewith social norms.

2. Implementation of Customer First Principles
We put our customers first and provide services at the highest quality to our customers.
We believe that gaining the trust of our customers is the basis for gaining the trust ofshareholders, local communities, and all other stakeholders.

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

We need to appreciate that we engage in financial service businesses centered on lease businesses inwhich we put our customers first; in other words, our ongoing development is derived from ourcustomers' prosperity.
"Putting our customers first" means that every single director and employee considers how he or she
can serve as the most reliable consultant for our customers and provide the best services that meet theneeds of our customers at all times. The accumulation of such daily efforts can lead to us gaining thetrust of our customers and appropriate profits.
We can exist as a corporation only after gaining a profit. Then, by using the profit to make newinvestments and create new services, we can further enhance the trust of our customers.
In other words, "putting our customers first" and gaining the trust of our customers is the basis of
secure and sound business management, which results in gaining the trust of other stakeholders.
Moreover, "putting our customers first" does not mean that we accept all requests from our customers
or provide services with no thought to profit. We should never forget that "putting our customers first"
does not conflict with "earning profits," but rather the two are connected to each other.

3. Compliance with Laws and Rules
We strictly comply with all laws and regulation, and carry out fair and honest business activities inline with social norms.
We respect local customs and cultures, as well as international standards and local laws in eachregion of the world.

We place ensuring compliance as the foundation of our Management Principle, based on which we
strictly comply with all laws and regulations, and perform fair and honest business activities in line withsocial norms.
It is not our policy to achieve this principle by merely avoiding violations of laws and regulations.
Instead, always bearing social norms in mind, we act with a high level of self-discipline based on fully
understanding the intent, purpose, and background of the establishment of laws and rules.
We also comply with international standards and foreign countries' laws and regulations, and respect the
local customs and cultures, as well as Japanese laws and regulations and social norms as a financial
business group, that provide services to overseas customers.
As laws, regulations, and social norms change with the times, we strive to accurately understand theunderlying social trends.
If we violate laws or regulations or act against social norms, we would be not only held legally liable but
would also be exposed to severe criticism from society. In addition, we could lose trust, our mostvaluable asset, which could, in some cases, shake the core elements of our business management.
150

Independent
assurance4. Respect for Human Rights
We act with respect for the dignity and fundamental human rights of all persons, including ourcustomers, directors, and employees, and establish a corporate culture with a spirit that fully
respects human rights.

Today, respect for human rights is a global standard of conduct. We are required to be strongly awarethat we shall not engage in, or allow others to engage in, discrimination or harassment for any reason(including based on factors such as gender, nationality, race, ethnicity, religion and disability). Moreover,
we take due care to protect privacy of others because we have many opportunities to accessinformation of various individuals.
The basic concept of respecting for human rights is to respect other people as human beings and to "putyourself in another person's shoes." To conduct bearing this concept in mind is an extremely important
platform for providing an energetic and great work environment for our employees, and to gain the trustof our customers.
We should be vigilant of human rights and never forget that we act with the highest respect for thehuman rights of all persons. Based on this recognition, we actively work on improving every single
employees' awareness of human rights.

5. Blocking Relationships with Anti-social Forces
We block any relationships with anti-social forces that pose a threat to the order and safety of civilsociety.

We block any relationships with anti-social forces.
We do not provide any products or services to anti-social forces. We conduct an appropriate
investigation before entering into transactions in order to prevent any transactions with anti-social
forces. If a counterparty to a transaction is found to be an anti-social force after entering into atransaction, we will promptly cancel such transaction.

We take organizational actions.
If a relationship with an anti-social force is found, the top management will be promptly notified andwe will take organization-wide actions.

We cooperate with external expert organizations.
We closely cooperate with external expert organizations such as the police, the National Center for
the Elimination of Boryokudan (anti-social forces), and lawyers on an ongoing basis, and address
issues with due care for the safety of our directors and employees.

We will not hesitate to take legal measures and respond with a firm attitude.
We respond to anti-social forces with a firm attitude in both criminal and civil aspects as necessary
and do not conduct any backdoor transactions in response to unreasonable demands or attacks suchas intimidation.

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Chapter 2 Basic Attitude of Fuyo General
Lease Group
1. Basic Attitude toward Customers
We always endeavor to provide satisfaction to customers, gain their trust and establish long-term
confidential relationships.
We strive to fully understand our customers and serve our customers faithfully.
We provide sufficient information to our customers and the highest level of comprehensive
financial services.
We strictly manage customers' assets.
We endeavor to improve ourselves to possess excellent insights, as well as expertise and skills, tomake ourselves useful to customers.

We act based on the principle of "putting our customers first" and always aim to provide the highest
level of comprehensive services that satisfy the needs of our customers. To this end, we should beaware that all of our activities lead to providing satisfaction to our customers and gaining their trust. We
also note the following items in performing acts in order to establish a long-term confidential
relationships with our customers.
First, it is important to know our customers well. We collect sufficient information on ourcustomers by carefully listening and closely observing our customers.
We accurately understand the needs of our customers by putting ourselves in a customer's shoes.
We provide adequate information based on accurate knowledge and provide services that meet theneeds of our customers through making the most of our ability to provide comprehensive financial
services.
We fulfill our promises to customers, and perform fair and honest business activities.
We always bear in mind that we store our customers' valuable assets with due care and strictly
manage information of our customers.
While it is important to become acquainted with customers, we do not offer nor receive
entertainment or gifts that deviate from social norms or conduct any acts, such as cash loans, that
may create an excessively familiar relationship with our customers.
We strive to improve ourselves to possess deep insights, as well as expertise and skills, to makeourselves useful to customers, and actively try to create and develop new business areas.

2. Basic Attitude toward Shareholders
To gain the trust of our shareholders, we endeavor to protect and increase our corporate assets.
We enhance and reinforce our internal control system by performing proper accounting andeffective internal audits.
In order to communicate accurate business information to shareholders, we actively disclose
information and improve the transparency of business management.

We keep our shareholders' valuable funds with due care as a joint-stock corporation.
Therefore, to respond to our shareholders' trust and expectations, we endeavor to promote theprotection and expansion of our group's assets and to maximize our profitability.
In order to gain widespread understanding and trust from our shareholders, we maintain the accuracy
and reliability of our financial and tax accounting procedures, and monitor whether they function152

properly and effectively under a strict internal control system. Moreover, we will further reinforce our
independent internal audit functions and improve the internal control system.
To those ends, we aim to achieve an "open management" style that is trusted by the markets throughactively disclosing appropriate information in a timely manner through opportunities such as the general
meetings of shareholders, as well as focusing on IR activities and maintaining a close two-way
communications with shareholders.

3. Basic Attitude toward Local Communities
We perform functions as a good corporate citizen who grows with local communities.
We actively perform social contribution activities.
We are aware that activities related to environmental issues are mandatory requirements for the
existence and operations of a corporation and perform such activities voluntarily and proactively.

Through the corporate actions and activities of our individual directors' and employees', we have a deep
involvement with the local communities upon which our existence relies. Therefore, we conductbusiness activities while harmonizing our Group's profits with the benefits of society, and perform thesefunctions as a "good corporate citizen" who contributes to the development of local communities.
Furthermore, in order to respond to social changes over time, we endeavor to closely communicate withsociety and respectfully listen to the opinions of society to ensure that our activities conform to social
norms and meet the expectations of society.
We regard engaging in social contribution activities as one of our social responsibilities and engage inactivities in various fields. In addition, we actively disclose our corporate attitude and actual activities
through media such as the disclosure materials in order to gain the understanding of society. Moreover,
we actively support volunteering activities carried out by our directors and employees.
Today, environmental issues are not limited to preventing conventional industrial pollution but extends
to issues common to all humankind such as the disposal of waste, nature conservation, and preservationof the global environment.
We acknowledge that we have a social responsibility to voluntarily and actively address environmental
issues, and promote the fulfilment of both economic development and environmental preservation.

4. Basic Attitude toward Employees
We help our employees lead more prosperous and fulfilling lives, and secure a comfortable andsafe work environment for our employees.
We create workplaces where workers respect each other and no discrimination or harassment
takes place.

While responding to the diversification of workers' values, we are required to establish various
employment and working forms and vacation systems under which workers can lead more prosperous
and fulfilling lives, and ensure that each worker can exercise his or her individuality and achieve
personal growth.
In order to address these challenges, we will create an attractive, free, and open-minded workplace
where workers can feel that their duties are worthwhile. We also strive to improve workers' sense of
ethics through education and training on compliance, and comply with labor laws and regulations, aswell as caring for health and safety in the workplace.

153

Our basic philosophy is to respect human nature and protect fundamental human rights. Discriminationand harassment are acts that violate human rights, which demotivate workers, disrupt order in theworkplace, and lead to a deterioration of the work environment. We do not permit any acts of
discrimination and harassment in any forms and for any reasons. We work to create a sound work
environment where workers respect the human rights of other workers and understand each other.
It is our basic policy to conduct fair and impartial employment screenings without discrimination. In
conducting employment screenings of employees, we make judgments based on the individual's abilities
and qualifications without any discrimination.

5. Basic Attitude toward Suppliers and Competitors
In purchasing goods and services and ordering systems, we make decisions that are objectively
based on factors such as quality, convenience, and price, and maintain sound and transparent

relationships with suppliers without engaging in acts that can be regarded as creating excessively
familiar relationships.
We require our suppliers to understand the Fuyo General Lease Group Code of Corporate Conduct.
We make efforts to approach corporate conduct with common sense, and engage in freecompetition in a fair and transparent manner.

Suppliers
In purchasing goods and services and ordering systems, we select suppliers by objectively andcomprehensively considering factors such as quality, convenience of service, price, and reliability.
Regarding relationships with suppliers, we maintain sound and transparent relationships without
engaging in acts that can be regarded as creating an excessively familiar relationship. To this end, we do
not ask or receive any entertainment or gifts in contravention of our internal rules.
Moreover, in order to maintain our credibility, we require our suppliers to understand the Fuyo General
Lease Group Code of Corporate Conduct.

Competitors
Due to the globalization of corporate activities and the expansion of a borderless economy, it isincreasingly important to conduct corporate activities in compliance with competition rules in themarket.
As basic rules that are essential for the sound development of a free economic society, many countries
have established laws such as anti-monopoly acts for the purpose of maintaining and promoting fair andfree competition. It is our responsibility to comply with these laws, including with the philosophy behindsuch laws.
We promote complete compliance with laws and will not engage in any illegal acts or pursue profits
through unreasonable means. Furthermore, we will not conduct any unfair competitive acts such asformation of a cartel or abuse of an advantageous position.
In accordance with the principle of self-responsibility, we carry out fair, transparent, and freecompetition based on our self-sustaining and independent spirit, which is a precondition of the market
economy system.

6. Basic Attitude toward Politics and Government154

We maintain sound and appropriate relationships with politics and government.

Many countries have established laws to regulate the participation of corporations in the politicalactivities of political parties and political offices.
Public officials, for example, government officials, have duties entrusted to them by citizens as servantsof all citizens. Thus, government officials are required to maintain ethics pertaining to their duties. Laws
and regulations also require administrative systems to be fair and transparent.
Moreover, with respect to foreign public officials, domestic laws, mainly in OECD countries, have beendeveloped pursuant to ensure fair competition in international business activities.
Based on the recognition of this environment regarding relationships with politics (political parties andpolitical offices) and government (supervisory agencies, etc.) inside and outside Japan, we maintainsound and transparent relationships without engaging in acts that can be regarded as creating aninterdependent relationship or an excessively familiar relationship.
To this end, we comply with laws and regulations and never offer illegal political contributions or provide
benefits. In particular, we firmly maintain our attitude of avoiding any suspicious acts with respect torelationships with public officials; as the saying goes, "don't straighten your cap under a plum tree(raising hands might seem as if one is attempting to steal the fruit above)."

Chapter 3. Action Guidelines for All membersof the Fuyo Lease Group
1. Maintaining Order in the Workplace
Each employee acts independently and autonomously with high ethical standards.
We cooperate and work with each other while respecting human rights and individuality to build an
open-minded workplace.
We eliminate empty formalities and obscure practices, etc.

Independence and rigorous ethical standard
We will work independently and autonomously with a rigorous ethical standard in carrying out ourduties, and act based on a thorough understanding of not only the wording of laws, regulations andrules, but also the spirit thereof, while conforming to social norms. Furthermore, we faithfully exercise
our work authorities without exceeding those bounds, and strive to report, communicate and consult
promptly.
We are aware that the results of our actions are entirely our own responsibility, and act accordingly. It is
unacceptable to violate the rules, regardless of the reasons behind them whether it was for the benefitof the company, a superior or a customer.

Respect for human rights and individuality
We respect each other's human rights and individuality, and do not engage in any form of
discrimination. We also do not engage in sexual harassment or any other forms of harassment.

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Teamwork and performance of work duties
Although it is expected that each employee acquires expert knowledge and skills relating to their field toperform their work duties, that alone is not enough. An organization is based on the cooperation andteamwork of each and every employee. It is a mistake to act of your own accord and disrupt teamwork,
thinking that you can do something by yourself. We bring together each individual's expertise and value
teamwork to provide the best service to our customers.

Open-minded workplace
We create an open-minded workplace where employees can freely discuss anything without fearing their
managers or superiors.

Elimination of rituals and obscure practices, etc.
We do not engage in acts based on formal courtesies (rituals) or obscure practices, etc. between
directors and employees. For example, it is unnecessary for directors and employees to exchange midyear and year-end seasonal gifts, etc. Instead, we prioritize our basic policy of "putting our customers
first".
In addition, directors and employees do not engage in money lending or solicitation of personal goods,
etc. among themselves without due cause.

No personal activities in the workplace
We do not engage in unauthorized personal activities such as political and religious activities during
working hours or within the company's facilities.

2. No Personal Use of Company Assets· We do not use company assets (expenses, goods, and know-how, etc.) for private purposes.

Company assets are loaned or provided to us for the purpose of carrying out business and should not be
used for private purposes.

Expenses
As directors and employees of the Financial Services Group, we always act with awareness that greatcare is required in dealing with money. We do not use or divert company expenses for private purposes.
Conversely, employees should make sure to charge for even small work-related expenses, such astransportation expenses when going out for work purposes.
In this way we are able to get into the habit of distinguishing between business and personal expenses.

Goods
Company goods (novelty items and office supplies, etc.) are not to be used for private purposes. In
order to discipline ourselves, we should think and act in a way that treats any fixtures as company
assets. Also, we refrain from using company telephones and computers (e-mail and Internet) etc. forpersonal use unrelated to the performance of work duties.

156

Know-how, etc.
We recognize that intangible items such as the Group's know-how, etc. are company assets, and do not
use them outside of our work.

3. Appropriate Information Management
We obtain external information by legitimate means and do not disclose any personal information
or nonpublic information concerning customers that we acquired in the performance of our work,or any confidential information about the Group itself. In addition, information obtained is used
only for work purposes, and not for private interests such as insider trading, etc.
We respect intellectual property rights, including patent rights and copyrights.
We will strive to actively create and share knowledge to increase customer satisfaction.

In performing our work we will handle all manner of different information. Strict and appropriate
management is required for all information that we obtain through work, such as customers' personaland nonpublic information, confidential information concerning the Group itself and information held byothers.
In addition, due to advances in the IT (information technology) revolution, there is increased risk ofexternal information leakage, intrusion into the company system by external parties etc., therefore themanagement of electronic information has also become increasingly important.

Obtaining information
We obtain external information by legitimate means, such as through authorized channels, and by
paying compensation as necessary. We do not obtain confidential information by means that breachlaws and regulations, or without obtaining consent from the relevant person.

Confidentiality
Unless there is a legitimate reason based on laws and regulations, or the relevant person has given
consent, the information obtained through work is used only for the purpose of such work, and is
carefully managed to ensure it is not leaked to external parties. Customers do business with us
particularly trusting that we do not disclose secrets to other parties. Protecting customers' secrets is abasic element of our work.

No unauthorized use, etc.
We do not engage in illegal investment activities such as insider trading, etc. or pursue personal
interests by using nonpublic information which we obtained through work. Moreover, we do not destroy,
counterfeit, tamper with, or illegally use the company's information.

Preventing leakage of information due to carelessness
It goes without saying that we do not intentionally leak information, but care must also be taken toprevent leakage due to negligence. For example, in performing our daily work we properly manage
documents and keep our desks orderly, as well as lock cabinets etc. We refrain from conversation that
leads to information leaks not only when in transit and at restaurants, but also in elevators andcafeterias, etc. within the company. We also do not leak confidential information to our families.

157

Disposal of information
We dispose of information that is no longer required, in accordance with company rules.

Joining or leaving the company
We do not use any secrets obtained while working at a previous place of employment at all, even if it isa document, etc. created by we made ourselves. Also, after leaving the company, we do not disclose
secrets obtained while employed at the company to any other party. We do not use any intellectual
property belonging to the company after leaving the company, even if we created it ourselves while a
director or employee of the company.

Information disclosure
We disclose company information in accordance with the prescribed rules. When asked for interviews
from external press or analysts, we consult with our managers or public relations department and follow
their instructions.

Protection of privacy
When handling personal information we make sure it is truly necessary to conduct our work, that it isobtained in a legal and fair way, and used and managed in a way which protects privacy at all costs.

Respect for intellectual property rights
We do not use information for which another party holds intellectual property rights (patent rights,
copyrights and trademark rights, etc.), in principle, unless the consent of the relevant person has beenobtained. We give due consideration not to infringe copyrights particularly for information obtained frommagazines, literature and the Internet, etc.
Meanwhile, in order to maintain the company's competitive edge, we will protect our company's
intellectual property, which includes patents, copyrights, trademark rights, financial technology
knowledge and know-how, and experience and knowledge acquired through our work.

Using information within the GroupWe recognize that the Group itself has a wealth of knowledge and information, and actively utilize suchinformation within the Group while paying attention to confidentiality obligations, etc. to enhancecustomer satisfaction and the Group's competitiveness.

4. No Conflicts of Interest
We act to ensure that the interests of the company or our customers are not harmed due to ourown interests.
We do not use our status in the company for the interests of anyone other than the company.

We always act with the interests of the company or our customers as our top priority. We are careful not
to put ourselves in situations where we may be seen as acting in our own interests. Even when we havedone nothing wrong, we need to be careful that others around us may perceive that there is a conflict ofinterests. We are responsible for being faithful to our duties at the company and do not engage in any
158personal investment or business that may prevent us from making reasonable judgments to optimize
the company's interests.

Use of status
We do not accept personal benefits by using our work duties or the status thereof. We also do not seek
personal advantages from any third party. For example, we will never use our work duties or status
thereof to request entertainment or goods, or cooperation with personal activities such as political or
religious activities. Also, we do not personally receive remuneration or commissions from our customers
or their employees, etc., or engage in money lending or borrowing.

Competing position
We do not place ourselves in a position where we compete with the company. We do not assume
positions as directors or employees of other rival companies, or engage in activities such as promoting
or supporting the sales activities of other rival companies.

Transactions involving relatives, etc.
We avoid engaging in transactions involving our family, close relatives and friends, etc. This is due to thefact that, compared to general customers, we are more prone to getting into a situation of having toprovide some advantages.

5. Appropriate Personal Conduct
We do not conduct any acts that harm or damage the company's credibility or honor, not only as apart of our work duties, but also outside of work.
We observe the Road Traffic Act not only as a part of our work duties, but also outside of work,and as a matter of course do not drink drive, or make another person drink drive.
When engaging in private activities outside the company we participate in a personal capacity, anddo not use the company name or our position title without due cause.
We do not engage in any other business without permission.

In principle the company does not usually get involved in or interfere with private activities. However, if
there is a risk of damaging the company's honor and interests, even private activities may be subject todisciplinary action.
We believe that the trust vested in us by customers and society is the foundation of our business.
Therefore, even in private activities that are separate from work, we are careful not to damage this trust
and are rigorous in ensuring we conduct ourselves appropriately.

Leading sound personal lives
We are constantly aware that we are members of the Financial Business Group, and try to lead soundpersonal lives to avoid falling into economic collapse due to speculative behavior, or taking out
guarantees or money lending and borrowing, etc. exceeding individual capabilities.

No drink driving
159

We fully recognize the tragedy of traffic accidents caused by drink driving, and absolutely do not drink
drive ourselves, or allow others to do so.

Distinction between public and private lives
We do not abuse the Group's company name or our job titles, and avoid harming the company's honor
and interests in order to gain personal benefits, etc. We clarify whether those activities are conducted as
directors or employees of our company, or whether they are private activities so as to avoid any
misunderstandings.

No other businessWe do not work at other companies or conduct business without permission. This is because holding
concurrent posts is prohibited by laws and regulations, or there may be conflict of interests.

6. Social Media Policy (Appropriate Personal Conduct 2)
We will not disclose confidential information within and outside the company as a matter of course,
or personal information and information obtained in the course of business regarding customers.
We recognize the existence of an unspecified number of people with diverse values, and do nottransmit information that is contrary to the facts, or that could be misunderstood by, or cause
discomfort to the receiving person.
We recognize that our own opinions and views could be perceived to be the views and opinions of
the company, so we strive to behave in a way befitting of a member of the company.
We always keep in mind to make respectful remarks, and respond calmly when criticized by otherpersons.
We comply with various laws and regulations and try not to infringe any third party intellectual
property rights and privacy on social media.

In recent years, social media that allows general individuals to disseminate information and exchange
opinions, etc. on the Internet have been developing rapidly due to the spread of smartphones and othertechnology.
Examples of popular social media include blogs, YouTube, Twitter and Facebook, etc.
Meanwhile, there has been a succession of issues caused by information disseminated on social media.
There are many cases where information (remarks) that were casually posted developed into an
incident, and the personal information of the person (employee) who posted the information wasdisclosed on the net, with even the person's workplace (company) becoming the target of criticism.
In order to prevent such issues, the company has established a social media policy (moderate personal
activities 2) as our basic stance for employees' use of social media.
In addition, as with the moderation in personal activities mentioned in the preceding paragraph, evenpersonal use of SNS may be subject to disciplinary action if there is a risk of damaging the company's
honor and interests.
Naturally, posting personal opinions on social media from the company's internal networks is restrictedby the systems.

Characteristics of social media
160

They can be accessed by an unspecified number of users with diverse values
The speed of information dissemination is fastOnce information is posted it is almost impossible to erase
Even if a person posts anonymously, there is a high probability that the person who posted thecomment will be identified

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

161

Top

> Sustainability> Governance and Management> Risk Management and Compliance System

Risk Management and Compliance System

Our Approach to Risk Management and Risk
Management System
As stipulated in the Fuyo Lease Group risk management regulations, we have established a risk
management system at our locations across the globe in order to manage risks based on their particularrisk characteristics and importance. Risks to be managed are categorized into credit, market (such as
interest rate fluctuation risk), liquidity (such as cash flow risk), administrative, system, legal, human,
reputation, and other risks. Each type of risk is managed by a designated department.
Under the supervision of the Risk Management Officer, our group risks are monitored from a cross-groupperspective. The Risk Management Officer receives reports from the departments assigned to each risk
and provides instructions where necessary to correct and improve issues. The officer also reports twice

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
Reporta year on the status of group overall risk management to the Executive Committee, which is convened
and chaired by the President & CEO.

Social Report

Furthermore, the Asset and Liability Management (ALM) Committee meets on a regular basis toappropriately manage and control market and liquidity risks. These efforts enable us to continually
improve our risk management system.
In addition, we have a system in place for responding to emergencies. In the event of a large-scaledisaster or emergency, the emergency response task force under the direction of the president will takemeasures necessary for ensuring safety and continuity of our operations in accordance with theGovernance andManagement

Corporate
Governance
Code ofCorporate
Conduct

Emergency Preparedness Regulations.

RiskManagement
andCompliance
SystemInformation
Security

Each Group
Company's
Environmental
and Social
initiatives

162

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Risk Management Training
In order to foster a corporate culture that enables risk prevention and that can take appropriate
measures against risks, the Fuyo Lease Group regularly conducts training that includes content related
to risk management. For example, in the leasing industry, legal risks are expected to be high, so training
is conducted for new employees on regulatory laws and regulations. We focus on training using casestudies and other methods so that each employee can deepen their understanding of possible risks intheir work and take appropriate measures.

Our Approach to Compliance and Compliance
System
At the Fuyo Lease Group, ensuring compliance is a fundamental principle of management. We work tostrengthen and enhance our compliance system, which enables us to operate with integrity and fairness
by conforming to relevant social norms, while strictly complying with all laws and regulations.
We promote compliance throughout the Group by stipulating various regulations, procedures, andmanuals, conducting compliance education, and enhancing the whistleblower system on the basis of theFuyo General Lease Group's Code of Corporate Conduct. In order to maintain and further improve ourcompliance systems, we implement and carry out compliance programs every fiscal year. Issues
associated with the compliance programs are discussed at the Compliance Committee and the Executive
Committee before being submitted to the Board of Directors for approval. Findings and progress of the
programs are reported to the Board of Directors on a semi-annual basis.

163

The core of group compliance system is the Compliance Committee chaired by the Chief Compliance
Officer and vice chaired by the Group Legal and Compliance Division Officer. The heads of relevant
planning and administrative departments, the heads of relevant departments of domestic and overseas
subsidiaries serve as full-time committee members, and outside lawyers serve as outside members. To
verify the effectiveness of the compliance system for the entire group, the Compliance Committee meets
every three months to deliberate and report on the formulation and progress of the Group's complianceprogram, whether or not compliance problems have occurred and how to deal with them, and trends inthe enactment, revision, or abolition of major laws and regulations.
We will continue our group-wide activities including management and implementation of compliancemeasures and compliance education, and streamlining our compliance systems across the Group to
improve their effectiveness.

Fuyo General Lease Group Code of Corporate
Conduct
The Fuyo Lease Group has formulated the Fuyo General Lease Group Code of Corporate Conduct, which
specifies the basic policies and position of the entire group as well as behavioral guidelines for theemployees of the Group.
We conduct training programs and offer e-learning courses to all employees to enhance theeffectiveness of the Code of Corporate Conduct. These programs and courses ensure that all employees
are aware of its policies and guidelines, and evaluation of the training is regularly reviewed.

Whistleblower Hotline
The Fuyo Lease Group operates whistleblower hotlines.
In addition to the in-house compliance hotline, we provide a consultation service desk through a
cooperating law firm. These services are available on a regular basis and guidance to these services isalways posted on the company's intranet bulletin board. Concerned individuals can immediately seek
consultation or report whenever they detect any violations of the law, the Code of Corporate Conductand other corporate regulations, harassment cases, misconduct in information management or otherpotential infringements. The whistleblower systems accept anonymous reports to protect
whistleblowers.
Compliance Officers* as well as persons in charge of compliance are appointed as consultants within
their departments and group companies to handle individual cases. In the event of non-compliance or asuspected violation, compliance personnel such as compliance officers are responsible for taking
appropriate measures and conducting investigations and reports in accordance with instructions andorders from Fuyo Lease's Group Legal and Compliance Division and the heads of the compliancedepartments of the relevant group companies as per the Compliance Manual.
*

A compliance officer is appointed for each department or company to raise compliance awarenessand ensure compliance.

Furthermore, Fuyo Lease has appointed full-time corporate auditors as a contact point for receiving
whistleblower reports from group companies, and we have also set up a contact point at affiliated law

164firms for whistleblowing from employees of overseas subsidiaries.
In fiscal 2020, three reports were received through the hotline. In each case, investigations arepromptly conducted, such as confirming the facts with the parties concerned with due care to protect
whistleblowers against detrimental treatment and taking appropriate measures. All cases have been
resolved, and measures put in place to prevent recurrences.

Prohibition of Corruption and Bribery
The prohibition of misconduct, including collusion, cartels, abuse of superior position, inappropriate
entertainment and gifts, and illegal political donations is clearly stipulated in Chapter 2 “5. Basic Attitude
toward Suppliers and Competitors" and “6. Basic Attitude toward Politics and Government," and Chapter
3 “2. No Personal Use of Company Assets" and “4. No Conflicts of Interest" of the Fuyo General Lease
Group Code of Corporate Conduct. We prohibit corruption, including bribery, and any actions that could
be suspected of being corrupt, and facilitation payments are no exception. The Management Committee
and Board of Directors of Fuyo Lease oversee these policies and their management status and receive
periodic reports from the Compliance Committee.
In order to prevent corruption and bribery and bring about its early detection, the Company implementscompliance audits in addition to identifying businesses, intermediaries and business partners that arehigh risk in the flow of its operations and avoiding involvement with them. In business audits, risks
regarding the identification and prevention of corruption and bribery are appropriately evaluated basedon confirmation of items such as proper use of entertainment expenses and the existence of a long-term
employees in the sales department. Furthermore, for cases that are considered to be particularly highrisk, we confirm that the compliance officer has further evaluated the appropriateness, and we arethoroughly preventing corruption and bribery.
We inform all Group employees about the Code of Corporate Conduct and the prohibition of corruption
and bribery, and encourage them to report to and seek consultation with the Whistleblower Hotline
whenever they have any suspicions. Support is also available anonymously.
Furthermore, the Code strictly prohibits the forging of collusive ties with political and administrative
authorities and business partners, and the private use of the company's assets. In fiscal 2020, no
infringements related to corruption were found in the Group. Additionally, no employees were dismissedor subjected to disciplinary action due to corruption.
In fiscal 2020, the Company made no political donations.

Compliance Training
The Fuyo Lease Group emphasizes employee training programs that are designed to ensure compliance.
Our training programs include workplace compliance training and e-learning on insider trading
regulations for all Group employees, as well as group training conducted by external instructors for
directors, heads of departments, offices and branch offices, presidents of Group companies, anddepartmental compliance officers. *Compliance Training (fiscal 2020)165

Group training and workplace training
Participant

New recruit

1st year employee(Generalist track)

5th year employee(Generalist track)# of
sessionSubject

Introduction to compliance, Fuyo General

1

Lease Group Code of Corporate Conduct,
Unreasonable demand

Confidential information management,
Personal information protection,
Prevention of harassment, Insider trading1

regulations

Response to accidents and troubles

1

Newly appointed head of
department/branch office

Issues to be understood as responsible
officers to ensure compliance1

Newly appointed assistantmanager/section chief

Prevention of power harassment, sexualand maternity harassment

2

Information management and prevention

1

All employees

Directors and head of
department/office/branch
officeof wrong emails

Importance of the whistleblower systemthat directors and head ofbranch/department should understand1

E-learning
Participant

Subject

Directors, head of
department/office/branch
office, compliance officer,
entry level

Regulation for Insider Trading (e-learningmaterial of the Japan Exchange Group)

2

General issues on compliance1

All employees# of session

Prevention of Money Laundering
The Fuyo Lease Group is striving to prevent money laundering and funding of terrorism.
Fuyo Lease complies with laws and guidelines together with a thorough due diligence of its business
partners in accordance with its Policy for the Prevention of Money Laundering. In addition, we have166

established a system to prevent money laundering and funding of terrorism not only in Japan but also intransactions outside Japan.
Furthermore, we continuously strive to promote understanding by way of training for all group
employees and by inviting outside experts to train the compliance and legal staff of each groupcompany.

Prevention of Insider Trading
At the request of the Tokyo Stock Exchange, Fuyo Lease has joined the J-IRISS*, which aims to prevent
unfair trading and to maintain the transparency and impartiality of the market.
*

J-IRISS (Japan-Insider Registration & Identification Support System): A system operated by theJapan Securities Dealers Association by which listed companies register information on their officers
and securities firms periodically compare this information on officers with their customer
information with the aim of checking for unfair trading before it happens and eliminating it as muchas possible.

Disclaimer

Disclosure Policy

Privacy policy

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167

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> Sustainability> Governance and Management> Information Security

Information Security

Our Approach and Management System for
Information Security and Customer
Information Protection
With unauthorized access to information via the Internet as well as cyber-attacks increasing daily andSustainability

Fuyo Lease
Group's CSV

becoming more sophisticated, the Fuyo Lease Group recognizes that information security risks are an
important management issue. The Group has established an information management system based on
work content, and strictly manages customer information.

Solving Social
Issues throughBusiness

In order to establish a strict information management system for the entire Group, data is strictly
controlled by our information security manager in accordance with detailed rules, including theConfidential Information Management Rule. Additionally, each employee is thoroughly informed of theAppropriate Information Management section included in the Code of Corporate Conduct as well as thePrivacy Policy, and we have implemented level-specific information security training programs.

Initiatives to Information Security and Customer Information
Protection
To appropriately protect customer information, when outsourcing work, we impose confidentiality
obligations on outsourcers, and when obtaining personal information from individual customers, wealways give notice of the purpose of use in accordance with the Act on the Protection of Personal
Information and its guidelines. In addition, our rules and regulations subject to disciplinary action under
the rules of employment include rules and regulations that concern information security, and we makeefforts to prevent violations. Furthermore, to maintain our information security system, once a year, we
confirm procedures that are not only conducted under regular circumstances but also those in which we
assume emergency situations in response to incidents such as cyber-attacks and natural disasters.
Also, training is provided for each level of employment so that each employee can recognize theimportance of information security and manage information appropriately. In fiscal 2020, we focused on
the protection of customer information through e-learning training for all employees, and we provided
training on the confidential information management and personal information protection for 1st year

Environmental
ReportSocial Report
Governance andManagement

Corporate
Governance
Code ofCorporate
Conduct
Risk
Management
andCompliance
SystemInformation
Security

employees (generalist track).
In fiscal 2020, there were minor issues, such as wrong email transmissions and incorrect delivery of
mail, but there were no incidents, such as violations of laws and regulations concerning information
security, and there were no related sanctions.

168

Each Group
Company's
Environmental
and Social
initiatives

In response to each customer segment and the work being handled, the following group companies
have acquired the Privacy Mark

Glossary

given to business operators who have been deemed

appropriate for the handling of personal information, and ISO27001 certification

Glossary, which isa global standard for information security management systems. By continuously improving ourmanagement systems based on these standards, we are working to further improve reliability.

Sharp FinanceSharp Finance is a leasing company that has its strengths in the retail market for small retail leasing,such as developing vendor leasing in collaboration with dealers for small- and medium-sized enterprises.
Since 2006, the company has been granted the Privacy Mark by JIPDEC.
Privacy Mark Registration Certificate

Click on the image to enlarge.

Accretive
Accretive provides solution services such as financial services and accounting administration. In March
2006, it acquired ISO27001 certification for the entire company.
ISO27001 Management System Registration Certificate

169

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assuranceClick on the image to enlarge.

Click on the image to enlarge.

INVOICEINVOICE's offerings include business customers integrated billing services that help reduce costs andimprove productivity, and Internet services for residential buildings for individual customers.
Since 2008, the company has been granted the Privacy Mark by JIPDEC.
Privacy Mark Registration Certificate

Click on the image to enlarge.

NOC Outsourcing & Consulting
NOC Outsourcing & Consulting handles a wide range of business outsourcing such as back office services(accounting, HR and payroll, general affairs, sales administration), IT services, personnel services.
In 1998, NOC Outsourcing & Consulting was granted the Privacy Mark by JIPDEC first in Japan.
Furthermore, in February 2006, it acquired ISO27001 certification for the Information Systems
Department, Business Headquarters.
Privacy Mark Registration Certificate

ISO27001 Management System
Registration Certificate

170Click on the image to enlarge.

Click on the image to enlarge.

Fuyo Network Service
Fuyo Network Service is engaged in the sales of information equipment, and is providing support for the
introduction and operation of the equipment and for activities such as erasing sensitive data. In January
2010, Fuyo Network Services acquired ISO27001 certification for the entire company.
ISO27001 Management System Registration Certificate

Click on the image to enlarge.

Click on the image to enlarge.

Fuyo Lease Sales Tokyo 3R Center
Fuyo Lease Sales focuses on Fuyo Lease's lease expiration processing business, and on purchasing andsales of used assets. The Tokyo 3R Center was opened in March 2013 as a base to recycle assets whose
leases have expired and for used assets. In June 2013, it acquired ISO27001 certification for the171

Information Security Room (ISR), which serves as the guideline for operations such as deleting data
saved in second-hand information equipment and checking their operational status. In March 2018, thescope of the ISO27001 certification was expanded to the entire Tokyo 3R Center.
ISO27001 Management System Registration Certificate

Click on the image to enlarge.

Click on the image to enlarge.

Glossary

Privacy MarkThe Privacy Mark is given to business operators that handle personal information
appropriately by conforming to the standards set in the Japanese Industrial Standard of
JIS Q 15001: 2017 Personal Information Protection Management System Requirements.

ISO27001
ISO27001 is a global standard for the specification of information security management
systems established by the International Organization for Standardization.

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

172

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> Sustainability> Each Group Company's Environmental and Social initiatives

Each Group Company's Environmental and Social
initiatives

Fuyo Auto Lease

AccretiveNOC Outsourcing &Consulting

FUJITA

Sharp Finance

INVOICE

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

YAMATO LEASE

Fuyo Network Service

Environmental
ReportSocial Report
Governance andManagement

Aqua Art

Fuyo Lease Sales

Each Group
Company's
Environmental
and Social
initiatives

Fuyo Auto
Lease
Sharp
Finance
Accretive
INVOICENOC
Outsourcing& Consulting

173

YAMATOLEASEFUJITA
Fuyo Network
ServiceAqua Art
Fuyo Lease
Sales

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

174

Top

> Sustainability> Each Group Company's Environmental and Social initiatives> Fuyo Auto Lease

Fuyo Auto Lease

Outline of Fuyo Auto Lease

Sustainability

ProfileFuyo Auto Lease reduces complicated operations related to customers' cars and supports a total

Fuyo Lease
Group's CSV

rationalization of management.

Solving Social
Issues throughBusiness

Company profile
Established

January 1987

Capital

240 million yen

Shareholders

Business Activities

Environmental
ReportSocial Report
Governance andManagement

Fuyo General Lease (100%)

Handling of automobile leasing/installment/sales, carmaintenance/repair/service, refueling cards/ETC cards

Each Group
Company's
Environmental
and Social
initiatives

Fuyo Auto Lease website

Fuyo Auto
Lease

Reducing the environmental impacts of auto
leasing business
Based on Fuyo Lease Group's Environmental Policy, Fuyo Auto Lease strives to reduce environmental
impacts company-wide. Above all, in the core auto leasing business, we are working on environmental
activities at all stages from the start of a lease lasting until the end of a lease.

Environmental activities in the auto leasing business

Sharp
Finance
Accretive
INVOICENOC
Outsourcing& Consulting
YAMATO
LEASE

175

FUJITA
Fuyo Network
ServiceAqua Art
Fuyo Lease
Sales

Initiatives to contribute to customer safety
Drive recorder suggestions
At Fuyo Auto Lease, we assist customers to prevent accidents by suggesting that they install a drive
recorder.
A drive recorder is an in-vehicle camera device that records items like the time, the location, forward
image, acceleration, turn signal operation and brake operation for approximately twelve seconds before
and after a large impact.

Characteristics of drive recorder
The driver can confirm objectively review driving behavior that is likely to cause a near-miss or atraffic accident.
Drivers can understand their own driving behavior, improve their awareness of safe driving by
reflecting on their actions, and prevent traffic accidents.

Suggestions for telematics
Fuyo Auto Lease supports customer's operation management and accident prevention throughtelematics proposals.
"Telematics" is a blend word that combines "Telecommunication" and "Informatics." It refers to a service
or a system that provides information by combining a communication system with a moving vehicle,
such as an automobile. By installing a dedicated in-vehicle unit, we can acquire various information andunderstand/analyze a driving situation.

176

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Holding safe driving seminars
Fuyo Auto Lease holds safe driving seminars so that customers can use vehicles safely and securely. In
fiscal 2020, we held 13 seminars for major companies, medium-sized companies, and small to midsized companies, which were attended by a total of 325 participants. At the seminars, we provided theattendees with lectures, paper tests, video training programs, and driving aptitude tests using
equipment.

Donation activities to assist children
orphaned from traffic accidents
Fuyo Auto Lease aims to contribute to society generally, even in areas outside the scope of business.
In addition, in fiscal 2020, continuing from the previous year, we donated funds to support children
orphaned by traffic accidents.

Results of support provided from FY 2014 to 2020

Details of Activities

Donation

FY
2014

Donated funds from our employees/company to the ScholarshipFoundation for Traffic Accident Orphans

210,000
yen

FY
2015

Donated funds from our employees/company to the ScholarshipFoundation for Traffic Accident Orphans

210,000
yen

FY
2016

Donated funds from our employees/company to the ScholarshipFoundation for Traffic Accident Orphans

210,000
yen

FY
2017

Donated funds from the company to the Scholarship Foundation for
Traffic Accident Orphans

200,000
yen

FY
2018

Donated funds from the company to the Scholarship Foundation for
Traffic Accident Orphans

200,000
yen

177

FY
2019

Donated funds from the company to the Scholarship Foundation for
Traffic Accident Orphans

200,000
yen

FY
2020

Donated funds from the company to the Scholarship Foundation for
Traffic Accident Orphans

200,000
yen

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

178

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> Sustainability> Each Group Company's Environmental and Social initiatives> Sharp FinanceSharp Finance

Outline of Sharp Finance

Sustainability

ProfileSharp Finance is a leasing company that has its strengths in the retail market for small leases, such as

Fuyo Lease
Group's CSV

developing vendor leasing in collaboration with dealers for small- and medium-size enterprises.

Solving Social
Issues throughBusiness

Company profile
EstablishedMay 1982

Capital3 billion yen

Shareholders

Business Activities

Environmental
ReportSocial Report
Governance andManagement

Fuyo General Lease (65%)
Sharp Corporation (35%)

Various leasing businesses, credit sales business, real estate rental
business, and insurance agency business"Sharp Finance" website

Each Group
Company's
Environmental
and Social
initiatives

Fuyo Auto
Lease

Fuyo General Lease and Sharp Finance have combined their expertise to meet diversified andsophisticated customer needs.

Sharp
Finance
Accretive

Development of community-based healthcare
through support to establish clinics andinitiatives to improve the health and welfareof residents

179

INVOICENOC
Outsourcing& Consulting
YAMATOLEASE

As the average age of doctors at clinics supporting community-based healthcare continues to increase*,“cycles” in which young doctors offer additional support will be essential to maintain healthcare systems.
One of those cycles will be the establishment of new clinics, which is actively supported by Sharp
Finance. In this way, we aim to make social contributions toward maintaining community-based
healthcare systems.

FUJITA
Fuyo Network
ServiceAqua Art

Through leasing initiatives implemented in the course of our main business, which is medical equipment
sales to vendors, we have amassed a business network of many customers that includes a large number

Fuyo Lease
Sales

of medical institutions, medical equipment manufacturers, pharmaceutical wholesalers, and accounting
firms. In addition to being a finance company providing financial support for business launches, we also
provide one-stop support for starting a business in cooperation with our business partners by fully
utilizing our network in each specialized field, such as accounting firms that handle various notifications
necessary for starting a business.
We supported the of opening of a clinic for the Toyocho Hagukumi Family Clinic, a pediatric clinic in
Koto-ku, Tokyo which opened in October 2021, as a result of an inquiry to our company’s specializedwebsite for business launch support. The area around Toyocho Station is being redeveloped, withconstruction of condominiums underway and the number of new families on the rise. We feel that we

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation

have contributed to community-based healthcare in this neighborhood by helping hospital directors
actualize their desire to build clinics that support the growth of children and the health of their families,
while fulfilling the demand for pediatric healthcare that has been continually increasing in this region.
*

The percentage of doctors over the age of 60 assigned to clinics was 59.8% in 2018; from theStatistics of Physicians, Dentists and Pharmacists 2018 published by the Ministry of Health, Labourand Welfare

Disclaimer

Disclosure Policy

Privacy policy

Editorial Policy
Independent
assurance

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180

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> Sustainability> Each Group Company's Environmental and Social initiatives> Accretive

Accretive

Overview of Accretive

Sustainability

ProfileAccretive purchases receivable accounts that arise from the delivery of goods and services, provides

Fuyo Lease
Group's CSV

financial services that support cash flow of supplying companies by providing cash early, and in addition
to supporting business efficiency also offers business process outsourcing (BPO) services such asaccounting administration to clients including retail business operators.

Environmental
ReportCompany profile
Established

CapitalShareholders

Business Activities

Solving Social
Issues throughBusiness

May 1999

Social Report

100 million yen

Governance andManagement

Fuyo General Lease (74%)
Pan Pacific International Holdings Corporation (26%)

Financial services centering on the purchases of accounts
receivables, BPO services such as accounting administration

Each Group
Company's
Environmental
and Social
initiatives

Fuyo Auto
Lease"Accretive" website

Sharp
Finance

Cambodia support activities

Accretive

Since 2017, in collaboration with its Cambodian subsidiary Accretive Service (Cambodia) Co., Ltd.,
Accretive has supported to elementary schools in Takeo province, Cambodia.
10 employees from Japan visited the local elementary schools and conducted exchange meetings toprovide guidance on hygiene and to donate goods such as clothing, stationery, and daily necessities

INVOICENOC
Outsourcing& Consulting
YAMATO
LEASE

collected from employees at each base in Japan.

181

The exchanges with the children were helpful in understanding the current local situation and its issues,
namely, that the educational environment in Cambodia's rural areas is lacking due to factors such as
equipment and funding shortages.
We will continue to participate in activities that improve this environment little by little in the future.

FUJITA
Fuyo Network
ServiceAqua Art
Fuyo Lease
Sales

Fund
procurement
through ESG
finance

We handed stationery directly to about 120 elementary
school students

Teaching hand-washing with soap

Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Playing together using a donated long rope

Commemorative photographApproach to Positive Off Motion
Accretive agrees with the aims of
the Positive Off -movement
advocated by the Japan Tourism
Agency to realize more meaningful leisure activities of employees and their families.
This movement sees "holiday = off" as "forward-looking = positive." Each employee can proactively
declare their plans to take paid leave, and as a result of going out and traveling during leisure time
becomes refreshed both mentally and physically, which enhances self-improvement, and contributes toeconomic revitalization.
Accretive is introducing a system that allows annual paid leave to be acquired in hourly units. The
Company is engaging in awareness-raising activities with posters to promote the new system and is
endeavoring to improve working environments and create an atmosphere that makes it easier to take avacation.

182

Disclaimer

Disclosure Policy

Privacy policy

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183

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> Sustainability> Each Group Company's Environmental and Social initiatives> INVOICEINVOICE

Outline of INVOICE

Sustainability

ProfileINVOICE provides integrated billing services for business clients that help reduce costs and improve

Fuyo Lease
Group's CSV

productivity, and Internet services for residential buildings for individual customers.

Solving Social
Issues throughBusiness

Company profile
Established

December 1992

Capital

100 million yen

Shareholders

Business Activities

Environmental
ReportSocial Report

Fuyo General Lease (80%)
Development Bank of Japan Inc. (20%)

Integrated billing services for business clients and Internet
services for residential buildings for individual customers“INVOICE” website

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives

Fuyo Auto
Lease

Contributing to Client Companies’ Improved
Productivity through BPO Services

Sharp
Finance

INVOICE provides integrated billing services, which are BPO services where INVOICE compiles the

INVOICE

individual telecommunications and public utility bills that are delivered to a customer's individual offices,
pays those bills on behalf of the customer, and then bills the customer for those charges all at once.
The corporate environment is changing significantly as labor shortages have become a social issue andwork-style reform is required to reduce long working hours. Companies face an urgent challenge to184

Accretive

NOC
Outsourcing& Consulting
YAMATOLEASE

increase the productivity of employees by streamlining cumbersome bill-processing tasks and increasing
the time used to focus on high value-added core business activities.
Against this backdrop, the utilization of INVOICE’s integrated billing services allows customers to unify
the different payment procedures used by each telecommunications carrier and utility provider,improving operational efficiency. Using the client’s mobile phone and Internet-related bills to understandthe details of usage and then proposing the most suitable communication plan also helps clientcompanies reduce their communication costs.

FUJITA
Fuyo Network
ServiceAqua Art
Fuyo Lease
Sales

There have been drastic changes in the business environment surrounding payment and settlement
services as a result of technological advances. With INVOICE, we will take advantage of these changes
to increase character recognition rates using AI and improve the overall efficiency of business processes
through the use of robotic process automation (RPA), thus contributing to the reduction of costs andimproved productivity for more customers.

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

Copyright(C) Fuyo General Lease Co., Ltd. All Rights Reserved

185

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> Sustainability> Each Group Company's Environmental and Social initiatives> NOC Outsourcing & Consulting

NOC Outsourcing & Consulting

Outline of NOC Outsourcing & Consulting
ProfileNOC Outsourcing & Consulting provides "total outsourcing" targeting administrative departments such

Sustainability

Fuyo Lease
Group's CSV

as general affairs, accounting, and human resources, as well as sales administration and IT.

Solving Social
Issues throughBusiness

Company profile
Established

November 1988

Capital

100 million yen

Shareholders

Business Activities

Environmental
ReportSocial Report
Governance andManagement

Fuyo General Lease (100%)Comprehensive outsourcing, human resources services, andshared services

Each Group
Company's
Environmental
and Social
initiatives“NOC Outsourcing & Consulting” website

Fuyo Auto
Lease

Providing BPO services that meet the needsof the times
The strengths of NOC Outsourcing & Consulting lie in its outsourcing services (BPO services) targeting
administrative departments such as general affairs, accounting, and human resources, as well as sales
administration and IT. In addition to its robust consignment and operational functions, NOC Outsourcing& Consulting is contributing to operational efficiency and cost reductions at approximately 1,000
companies. It is doing this by visualizing and standardizing operations through the use of its own
consulting functions, and by automating and reducing the number of employees through the use of
system development functions such as RPA.

186

Sharp
Finance
Accretive
INVOICENOC
Outsourcing& Consulting
YAMATO
LEASE

The recent decline in the number of people coming to work due to the spread of COVID-19 has
prolonged risks to business continuity for companies. This has raised the question of what tasks can behandled with minimum personnel. As a result, there is a growing need to develop telecommuting
environments and BPO services as part of BCP measures. In March 2020, NOC Outsourcing & Consulting
also began providing IT outsourcing services that make use of the Tokyo Metropolitan Government
Business Continuity Emergency Measures (Telecommuting) Grant. It has promptly engaged insupporting clients who have already entrusted it to carry out payroll processing to prepare documents
related to payment applications for employment adjustment subsidies.
Going forward, NOC Outsourcing & Consulting will continue to be more sensitive to changes in thebusiness environment as well as accompanying changes in needs, and will proactively respond to newneeds of the times.

FUJITA
Fuyo Network
ServiceAqua Art
Fuyo Lease
Sales

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

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> Sustainability> Each Group Company's Environmental and Social initiatives> YAMATO LEASEYAMATO LEASE

Outline of YAMATO LEASE

Sustainability

ProfileYAMATO LEASE provides support services for the management issues of transportation companies, such

Fuyo Lease
Group's CSV

as succession problems and driver shortages in addition to providing support for the leasing,Solving Social
Issues throughBusiness

procurement, and sales of new and used trucks.

Company profile
Established

Environmental
ReportMarch 1977

Social Report
CapitalShareholders

Business Activities

30 million yen

Governance andManagement

Fuyo General Lease (60%)
YAMATO HOLDINGS CO., LTD. (40%)

Truck leasing and installment sales, used car sales"YAMATO LEASE" website

Each Group
Company's
Environmental
and Social
initiatives

Fuyo Auto
Lease

Supporting vehicle procurement to resolve
management issues faced by transportcompanies

Sharp
Finance

In the logistics industry, many social issues have become apparent, including an increase in the volume

NOC
Outsourcing& Consultingof cargo being handled due to the expansion of the e-commerce market, shortages and aging of truck
drivers, and work-style reform in response to the reduction of long working hours. In addition, theautomobile industry is said to be entering a once-in-a-century period of great change due to CASE*1
technological innovations and the progress of MaaS*2 that connects vehicles and other means of188

Accretive
INVOICE

YAMATO
LEASE

transportation with IT. Environmental regulations, such as automobile exhaust regulations, are also
being strengthened. Against the backdrop of such changes in the business environment, transportationcompanies are also required to procure vehicles in an optimal manner to adapt to these changes.
By using truck leasing from YAMATO LEASE, transportation company customers can introduce vehicles
that are suited to the latest environment without the need for large sums of money. In addition, as truck
distribution support, we offer full support for the replacement of trucks through proposals for purchaseof existing and used trucks to meet our customers' and social needs. When selecting a used truck, we

FUJITA
Fuyo Network
ServiceAqua Art
Fuyo Lease
Sales

provide an environment where customers can search for a vehicle that meets their needs in a cataloglike manner through our "Tora-Machi" used-truck matching application.

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Our strengths lie in our customer network as well as proposal-based sales, and going forward, we willcontinue to leverage these strengths in support of vehicle procurement that resolves the issues faced bytransportation companies.
*1

CASE stands for Connected, Autonomous/Automated, Shared, and Electric. It is expected thattechnological innovation in these new areas will change the ways in which mobility and our society
will exist.

*2

MaaS refers to Mobility as a Service, which indicates services that connect vehicles, public
transportation, and other means of transportation through IT.

The first leasing company to be certified as
an organization that promotes the
Comfortable Workplace Certification System
YAMATO LEASE has been certified by the Ministry of Land, Infrastructure, Transport and Tourism andthe Nippon Kaiji Kyokai as an organization that promotes the Driver's Workplace Environment Quality
Certification System (commonly known as the Comfortable Workplace Certification System).
189

The Comfortable Workplace Certification System is a system to certify
companies that are engaged in work-style reform, such as the revision oflong working hours, in order to improve working conditions and theworking environments of drivers as well as to secure and train drivers
who are needed.
In order to promote the Comfortable Workplace Certification System, YAMATO LEASE holds briefing
sessions, provides advice as well as guidance, and supports trucking companies in obtaining
certification. In fiscal 2020, YAMATO LEASE supported 174 companies in obtaining certification. We aim
to maintain safety management of the transportation industry and solve social issues such as theshortage of human resources.

*

The Comfortable Workplace Certification System is a system in which a third-party organization
evaluates and certifies the working environments of automobile transportation companies andprovides this information mainly to job seekers. To encourage companies that have acquired
certification to move to a higher level, there are three levels of certification depending on thenumber of certification items that a company has achieved. The three levels of certification are one
star, two stars, and three stars.

Business succession support services
specifically for the transportation industry
YAMATO LEASE provides business succession support services specifically for the transportation industry.
The business succession support services provided by YAMATO LEASE leverage the experience andknow-how that we have acquired from leasing trucks to transportation companies to match companies
that are struggling to continue business due to aging managers and a lack of successors with companies
that want to expand their business.
Through our business succession support services, we aim to solve the challenges facing the industry,
such as the problems of finding successors at transportation companies, retaining employees, andresolving driver shortages.

Disclaimer

Disclosure Policy

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> Sustainability> Each Group Company's Environmental and Social initiatives> FUJITA

FUJITA

Outline of FUJITA

Sustainability

ProfileFUJITA Co., Ltd. provides full support for the purchase, demolition and removal of medical equipment, inFuyo Lease
Group's CSV

addition to the disposal of medical equipment, furniture and fixtures when hospitals and clinics open,

Solving Social
Issues throughBusiness

relocate, and/or close.

Company profile
Established

Environmental
ReportJuly 2006

Social Report
CapitalShareholders

70.35 million yen

Governance andManagement

Fuyo General Lease (51%)
Ken Fujita (38%)
Shuji Furuta (11%)

Buying and selling second-hand medical equipment(including installation and removal)

Business Activities

Demolition and removal of medical equipment, furniture andfixtures when hospitals and clinics closed
Disposal of leftover office items

Each Group
Company's
Environmental
and Social
initiatives

Fuyo Auto
Lease
Sharp
Finance“FUJITA” website

Accretive

Initiative to resource circulation throughpromotion of the 3Rs
FUJITA is truly committed to the 3Rs (reuse, recycle, and reduce) to reduce the amount of waste when
the company engages in the purchasing and selling of second-hand medical equipment and disposing of191

INVOICENOC
Outsourcing& Consulting
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LEASE

medical equipment from hospitals or clinics that have been closed.

FUJITAIn particular, FUJITA focuses its efforts on the reuse element of the 3Rs. The company reuses not only
medical equipment*1, but also extends its reuse activities including equipment, furniture, fixtures, andother items*2 that remain in hospitals. The company strives for resource circulation in order to maximize
the reuse of resources and cut down on waste. Furthermore, the company provides support to hospitals
and clinics in the disposal of their medical equipment when they close. These activities allow thecompany to efficiently sort out and separate waste and recyclable metals or plastics. The company's

Fuyo Network
ServiceAqua Art
Fuyo Lease
Sales

activities to reduce the waste amount results in lower waste disposal costs incurred by the customers.
*1

Heavy medical equipment including MRI scanners, CT scanners, and angiography machines andportable equipment including ultrasonic diagnostic equipment and endoscope systems.

*2

Hospital beds, office furniture and equipment, electrical appliances, books and magazines, etc.

FUJITA's 3Rs

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Cost reduction through reusing and recycling① Reuse
FUJITA reuses medical equipment, office equipment and furniture, and electronic equipment.

② Recycle
FUJITA sorts out and separates waste. Furthermore, the company recycles it as resources including
metals and plastics.

③ Reduce
As a result of reducing the waste amount, FUJITA can cut disposal costs.

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> Sustainability> Each Group Company's Environmental and Social initiatives> Fuyo Network Service

Fuyo Network Service

Outline of Fuyo Network Service
ProfileFuyo Network Service provides technical services such as selling ICT equipment and software, providing

Sustainability

Fuyo Lease
Group's CSV

technical services including assembly, configuration and data erasure, and reselling used PCs based on

Solving Social
Issues throughBusinessthe company-wide ISO 27001 security standards certification.

Company profile
Established

Environmental
ReportApril 1995

Social Report
CapitalShareholders

Business Activities

40 million yen

Governance andManagement

Fuyo General Lease (100%)

Selling servers/PCs/peripherals, performing assembly/installation
services, data erasure services, constructing network systems

Fuyo Network Service website

Each Group
Company's
Environmental
and Social
initiatives

Fuyo Auto
Lease

Promoting the reuse of used PCs andcontributing to a circular society

Sharp
FinanceFuyo Network Service's Hachioji Technical Center accepts about 5,000 used computers per month

INVOICE(approximately 60,000 computers in a year) that have been used in the PC Rental and PC Eco & Valueleases provided by Fuyo Lease. After this, the company re-commodifies (reuses) them.
In the recycling process for customers who would like to employ used computers, we take appropriate
measures such as erasing existing data and checking the operational status of the computer. By

193

Accretive

NOC
Outsourcing& Consulting
YAMATO
LEASE

establishing a system for the resale of used PCs that have been leased or rented and are no longer in
use and promoting reuse, we are contributing to creating a circular society.

FUJITA
Fuyo Network
ServiceAqua Art
Fuyo Lease
Sales

Fund
procurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

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> Sustainability> Each Group Company's Environmental and Social initiatives> Aqua Art

Aqua Art

Outline of Aqua Art

Sustainability

ProfileAqua Art was established in March 1994 as a wholly-owned subsidiary of Fuyo Lease. It operates a

Fuyo Lease
Group's CSV

rental business for tropical fish tanks, which replicate the natural environment.

Solving Social
Issues throughBusiness

Company profile
EstablishedMarch 1994

Capital50 million yen

Shareholders

Business Activities

Environmental
ReportSocial Report
Governance andManagement

Fuyo General Lease (100%)

Manufacture, sale, rental, and maintenance of ornamental
aquarium

Each Group
Company's
Environmental
and Social
initiatives

Aqua Art website

Fuyo Auto
Lease

AQUA ART interior aquarium

Sharp
Finance

AQUA ART is a product that reproduces the structure of the natural world in an aquarium using realcreatures.

Accretive

Specialist staff create each aquarium using detailed work and skills in a production process of around 50

INVOICEsteps. These include cleaning the sand laid in the bottom of the aquarium, circulating water to disperse
bacteria through the tank, individually planting each aquatic plant and positioning each rock and piece ofdriftwood to create the layout inside the aquarium to incorporate and adjust each of the materials.
AQUA ART is unique, individually crafted rental aquarium.

NOC
Outsourcing& Consulting
YAMATO
LEASE

195

(1) Drawing people together to foster communication

FUJITA

AQUA ART provides spaces for people to share meaningful connections through conversation. It
provides places for people to congregate naturally, and a pocket of relaxation in places where people
visit for the first time, releasing tension and starting conversations.

Fuyo Network
ServiceAqua Art(2) Raising awareness about preserving the natural environment and educating thenext generation

Fuyo Lease
Sales

AQUA ART recreates environments for living creatures inside an aquarium, offering a chance to learn
about how the natural world works. We provide an opportunity to think about nature in terms of familiar
living creatures, the food chain, and biodiversity.

Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Cycle system of AQUA ART

Contributing to the environment throughproducts
Our AQUA ART rental aquariums are tended by specialist staff, who recreate natural eco systems insidethem. The connection between aquatic plants and tropical fish promotes purification of the water,
helping to maintain water quality. This helps to minimize the amount of water used for replacement, andmaintains the condition of the fish and plants, helping to protect water resources and living creatures.
Tropical fish and aquatic plants are procured through nurseries to maintain and protect the naturalenvironment. At the same time, the Company is also working to breed its own. We also strive to actively
reuse and recycle old aquariums and apparatus.

Contributing to society through products
Aqua Art is also collaborating with Fuyo General Lease in the "Aqua de Smile" social contribution activity
using AQUA ART aquariums.
As part of this activity, we provide AQUA ART free of charge to nine maternal and child living support
facilities and facilities supporting employment for people with disabilities in Tokyo and neighboring
prefectures. Moreover, as part of environmental education activities undertaken by our staff, during thesummer holidays they hold visiting lessons for the children at the facilities. The lessons are filled with full196

of happy faces and joyful cheering, using a quiz format to teach children about the habits andcharacteristics of tropical fish in a fun way, and helping them to learn about ecosystems.
We also hold the AQUA ART Design Contest. Students of the Tokyo Metropolitan Kogei High School,
Tokyo Designer Gakuin College, and TCA Tokyo College of Eco & Animals near the Fuyo General Lease
Head Office compete to create special design and decoration for an aquarium interior, with the best
entries displayed at the entrance and lobby of the Tokyo Dome Hotel. During the exhibition period, thehotel visitors vote for their favorite entry, enabling a large number of people to enjoy the competition.

Children cheerfully responding during a visiting lecture(fiscal 2019)

Disclaimer

Disclosure Policy

Students in the production group from Tokyo
Metropolitan Kogei High School with their entry
displayed in the lobby of the Tokyo Dome Hotel(Summer 2019)

Privacy policy

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> Sustainability> Each Group Company's Environmental and Social initiatives> Fuyo Lease Sales

Fuyo Lease Sales

Outline of Fuyo Lease Sales

Sustainability

ProfileFuyo Lease Sales handles administrative work for Fuyo Lease's lease expiration cases and sales of used

Fuyo Lease
Group's CSV

property. It also purchases and sells property owned by customers.

Solving Social
Issues throughBusiness

Company profile
Established

CapitalShareholders

Business Activities

Environmental
ReportApril 1996

Social Report

10 million yen

Governance andManagement

Fuyo General Lease (100%)Administrative work related to re-leasing contracts, administrative
work related to the sale/disposal of lease-end properties, secondhand trade

Fuyo Lease Sales website

Each Group
Company's
Environmental
and Social
initiatives

Fuyo Auto
Lease

Saving resources and reducing waste throughthe 3Rs

Sharp
FinanceFuyo Lease Sales is responsible for processing Fuyo Lease's lease property, whose lease contract has

INVOICEexpired, and implementing the 3Rs (reduce, reuse, recycle) under the Environmental Policy of Fuyo

Accretive

NOC
Outsourcing& Consulting

Lease Group.

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LEASE

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FUJITA
Fuyo Network
ServiceAqua Art
Fuyo Lease
Sales

Fund
procurement
through ESG
financeFuyo Lease Sales Operations and Promoting the 3Rs

Tokyo 3R Center
At the Tokyo 3R Center, we reuse and recycle not only lease-expired property but also for used assets

Participation in
Initiatives andThird-Party
Evaluation

we buy from other companies.
In October 2017, we expanded the Tokyo 3R Center, and one of Fuyo Lease Group companies, Fuyo
Network Service, relocated its technical center to the Tokyo 3R Center to strengthen the Group's reuse
and recycle functions.
Since May 2019, we have been working on reducing waste by building a recycling system at the Seki
Factory of Matsuda Sangyo Co., Ltd. for equipment that cannot be reused at the Tokyo 3R Center.

The Seki Factory, Matsuda Sangyo Co., Ltd.

Tokyo 3R Center website

Appropriate disposal of waste
Property for which a lease has expired and cannot be reused are discarded. Going above and beyond
simply complying with the Waste Disposal and Public Cleaning Law (Waste Management Act), as awaste generating business operator, we keep close track of every piece of waste we dispose of throughan electronic manifest system. We conduct on-site inspections of waste disposal contractors according toan annual schedule.

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Editorial Policy
Independent
assurance

Management of outsourcers

Management of reports

Examples of intermediate processing plants
Waste is transported to an intermediate processing plant and is reduced in quantity and volume byprocesses such as crushing. As a result, a lot of waste is now being recycled at the intermediate
processing plant.

KANAME KOGYO Co., Ltd.
Shikahama Recycling Center of KANAME KOGYO Co., Ltd. isan intermediate processing factory established in September
2000. It is responsible for crushing and recycling mixed
waste generated in the Tokyo metropolitan area.
In 2002, it obtained ISO14001 certification, and in 2010 it
acquired Industrial Waste Expert certification under Tokyo's
excellent industrial waste processing company certification
system. In 2011, it acquired certification as an Excellent

Shikahama Recycling Center,
KANAME KOGYO Co., Ltd.

Industrial Waste Processing Company.
In December 2017, it was listed on the Second Section of the Tokyo Stock Exchange.
The company publishes a waste information magazine called the KANAME Environmental News for
waste-generating business operators and carries out activities such as free business consultations andworkshops. The company is working to expand the appropriate disposal of waste.

Re-Tem Corporation

200

Tokyo Plant of Re-Tem Corporation, which was completed
and started operations in 2005, is the newest plant, and ispart of the Tokyo Super Eco Town being built in the Tokyo
Bay area as part of Japan's urban renewal project. It recycles
100% of various wastes, mainly metal waste, discharged in
the Tokyo metropolitan area.
Tokyo Plant, Re-Tem Corporation

Example of final disposal site
The final disposal of waste is shifting to recycling processes due to the lack of final disposal sites forlandfilling.

ECO KEIKAKU CO., LTD.
ECO KEIKAKU CO., LTD.'s Yorii Eco-Space and Arashiyama
Eco-Space are the only private facilities certified by the
Ministry of the Environment under the Act on Promotion of
Development of Specified Facilities for the Disposal ofIndustrial Waste as comprehensive recycling facilities
contributing to improved recycling rates.
Both facilities, which are capable of accepting waste items
totaling over 20 different item types, are actively involved in

Yorii Eco Space, ECO KEIKAKUCO., LTD.

developing new technologies such as material recycling, in order to meet various needs. The plants use
mainly thermal recycling with a total processing capacity of 155.8 t a day.
Fuyo Lease periodically visits the company's disposal facility and disposal site to confirm the on-site
conditions, to exchange information and to build relationships that can help both companies to improve
environmental awareness.

Disclaimer

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> Sustainability> Fund procurement through ESG financeFund procurement through ESG finance

The Fuyo Lease Group is promoting business strategies based on the CSV approach, and proactively
advancing ESG financing initiatives in its fund procurement.

Sustainability

We will continue to diversify our methods of fund procurement and further promote our response to the
problem of climate change and to social issues, aiming to contribute to the realization of a sustainable
society.

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness

Issuance of Green Bonds
Green bonds are bonds whose proceeds may only be used for green projects (projects that are expected
to improve the environment), such as renewable energy projects, construction and upgrade of energy-

Environmental
Reportsaving buildings, and the prevention and management of environmental pollutants.
Fuyo General Lease Co., Ltd. No.17 unsecured corporate bonds (limited to corporate bonds with a
special agreement on the same priority) (Green Bond)
Fuyo General Lease Co., Ltd. No.20 unsecured corporate bonds (limited to corporate bonds with a
special agreement on the same priority) (Green Bond)

Issuance of Sustainability-Linked Bonds
Sustainability-linked bonds are bonds whose conditions vary depending on the achievement of set
sustainability performance targets (SPTs), which are based on sustainability targets that have been set
out in the issuers comprehensive social responsibility strategy.
Fuyo General Lease Co., Ltd. No.27 unsecured corporate bonds (limited to corporate bonds with a
special agreement on the same priority) (Sustainability-linked Bond)

Issuance of Sustainability Bonds
Sustainability bonds are bonds whose proceeds may only be used for projects that contribute toenvironmental and social sustainability.
Fuyo General Lease Co., Ltd. No.31 unsecured corporate bonds (limited to corporate bonds with a
special agreement on the same priority) (Sustainability Bond) (Fuyo CSV Bond)

202

Social Report
Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
financeIssuance ofSustainabilityLinked Bonds
Issuance ofSustainability
Bonds
Fuyo General
Lease Co.,
Ltd. No.17

unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)
Fuyo General
Lease Co.,
Ltd. No.20
unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)

Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

Disclaimer

Disclosure Policy

Privacy policy

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203

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> Sustainability> Fund procurement through ESG finance> Outline of Sustainability-Linked Bond

Outline of Sustainability-Linked Bond

Name

Fuyo General Lease Co., Ltd. No.27 unsecured corporate bonds(limited to corporate bonds with a special agreement on the same

Sustainability

priority) (Sustainability-Linked Bond)

Issue duration

Issuance amountIssuing Conditions
and Related
Sustainability
Performance Targets(SPTs)

Fuyo Lease
Group's CSV

7 years

10 billion yen

1. Renewable energy usage rate for group electricity consumption
50% or more (Maturity: July 2024)
2. Cumulative amount of the Fuyo 100% Renewable Electricity
Declaration Support Program, and the Fuyo Zero Carbon City
Support Program 5 billion yen or higher (Maturity: July 2024)

Solving Social
Issues throughBusiness
Environmental
ReportSocial Report

0.380% per annum from the day following December 24, 2020 to

Coupon rate

December 24, 2024.
From the day following December 24, 2024, a coupon step-up of
0.10% will be generated if any of the SPTs linked to the issue
conditions have not been met on July 31, 2024.

Condition decisiondate

December 18, 2020

Issue date

December 24, 2020

Redemption date

December 24, 2027

Ratings

Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance

Japan Credit Rating Agency, Ltd. (JCR): A+
Rating and Investment Information, Inc. (R&I): A

Issuance ofSustainabilityLinked Bonds

Third-party Assessment of Eligibility

Issuance ofSustainability
Bonds

Ministry of the Environment's Model Case for IssuanceFuyo General
Lease Co.,
Ltd. No.17

204

The Fuyo Lease Group's Sustainability-Linked Bond was selected as a model case for the fiscal 2020
Sustainability Linked Loans, etc. Issuance by the Ministry of the Environment, and on November 27th,
2020 it was announced that the Ministry of the Environment and certification bodies (Japan Credit
Rating Agency, Ltd. and E&E Solutions Inc.) had verified the conformity of the framework for issuing of
the Sustainability Linked Bond with the Ministry of the Environment's Green Loan and Sustainability
Linked Loan Guidelines 2020 and the International Capital Markets Association's (ICMA) SustainabilityLinked Bond Principles.
Conformity results for the Guideline of a model case for fiscal 2020 Sustainability Linked Loan, etc.

Pre-issuance Report

Announcement of Investment in the
Sustainability-Linked Bond
These are the investors who have announced that they will invest
in the Sustainability-Linked Bond
List of investors who have announced investment (Japanese alphabetic order)

unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)
Fuyo General
Lease Co.,
Ltd. No.20
unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)(As of December 18, 2020)
IO Shinkin BankThe Toyota Shinkin BankAICHI CHITA AGRICULTURAL COOPERATIVE

Nagano Shinkin BankASSOCIATION

Nagano Labour Bank

Asset Management One Co., Ltd.

Nagoya Broadcasting Network Co., Ltd.

Awaji Shinkin Bank

Nishihyogo Shinkin Bank

Ishinomaki Shinkin Bank

Nishimikawa Agricultural Cooperative

Ibaraki Prefectural Credit Federation of

Nissay Asset Management Corporation

Agricultural Cooperatives

Hagi Yamaguchi Shinkin Bank

Okayama Shinkin Bank

Hamamatsu Iwata Shinkin BankTHE KANAGAWA BANK, LTD.

Handa Shinkin Bank

Kanonji Shinkin Bank

Hanno-Shinkin Bank

Gifu Prefectural Credit Federation of Agricultural

Hyogo Shinkin Bank

Cooperatives

Hiratsuka Shinkin Bank

Kuwanamie Shinkin Bank

Fukoku Mutual Life Insurance Company

The 77 Bank, Ltd.

BlackRock Japan Co., Ltd.

Shinonome Shinkin Bank

The Hekikai Shinkin Bank

Shibata Shinkin Bank

Mie Prefectural Credit Federation of Agricultural

Suwa Shinkin Bank

Cooperatives

Seishin Shinkin Bank

Sumitomo Mitsui Trust Asset Management Co.,

Saison Automobile and Fire Insurance Co., Ltd.

Ltd.

Takanabe Shinkin Bank

The Miyazaki Taiyo Bank, Ltd.

Tajima Shinkin Bank

Moka Credit Union

Danyo Shinyo Kumiai BankThe Yuki Shinkin Bank

Choshi Shinkin Bank

Yokohama Agricultural Cooperative

Tokyo City Shinkin Bank

Lifenet Insurance Company

Tokyo Higashi Shinkin Bank

205

Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

The Tono Shinkin Bank

Wakayama Prefectural Credit Federation of

The Toa Reinsurance Company, Limited

Agricultural Cooperatives

Reporting
SPTs and Status of Progress on Targets
SPT 1 Renewable energy usage rate for group electricity consumption 50% or more
(Maturity: July 2024)
In participating in RE100, Fuyo General Lease has set a target of 50% renewable energy use for theGroup by 2030 and 100% by 2050. However, under SPT (1) for this sustainability linked bond, we havebrought forward the medium-term target achievement timing to renewable energy use of 50% by July
2024. *1 Most of the Fuyo Lease Group's electricity consumption takes place among tenants of its officebuildings. However, the Company is cooperating with the building owner of its head office building andwith retail electricity providers to develop a new method for realizing effective transition to renewableenergy for tenants.*2 From April 2021, all of the electric power used at the Company's head officebuilding has been converted to RE100 compliance electricity, and we plan to convert to renewableenergy at remaining locations as well.

Status of Progress
Renewable energy usage rate for group electricity consumption: 1% (as of March 31, 2021)。
*1

In July 2021, we brought the target forward again, so that the current target is “50% by 2024,
100% by 2030.”*2

Relevant press release: “Individual Office Building Tenants Switch to RE100 Compliant Electricity
from Solar Power Station at Namie, Fukushima Prefecture, which is Working to Recover from theGreat East Japan Earthquake” (In Japanese only)

SPT 2 Cumulative amount of the Fuyo 100% Renewable Electricity Declaration
Support Program, and the Fuyo Zero Carbon City Support Program 5 billion yen or
higher (Maturity: July 2024)

206

The second SPT is a target for the cumulative handling amount of the Fuyo 100% Renewable Electricity
Declaration Support Program, and the Fuyo Zero Carbon City Support Program of 5 billion yen or higher
by 2024. By setting new quantitative targets based on the progress of the two programs, we aim to
actively support companies and local governments working to decarbonize.

Status of Progress
Cumulative amount: 2.64 billion yen (as of March 31, 2021)

Disclaimer

Disclosure Policy

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> Sustainability> Fund procurement through ESG finance> Outline of Sustainability Bond (“Fuyo CSV Bond”)

Outline of Sustainability Bond (“Fuyo CSV Bond”)

Name

Fuyo General Lease Co., Ltd. No.31 unsecured corporate bonds(limited to corporate bonds with a special agreement on the same

Sustainability

priority) (Sustainability Bond) (known as “Fuyo CSV Bond”)

Issue duration

Issuance amount

Coupon rate

Fuyo Lease
Group's CSV

5 years

10 billion yen

Solving Social
Issues throughBusiness

0.120%

Condition decision
date

September 10, 2021

Issue date

September 17, 2021

Environmental
ReportSocial Report
Governance andManagement

Redemption date

September 17, 2026

Use of proceeds

Refinance of the following in Use of Proceeds for this Sustainability
Bond

Ratings

Japan Credit Rating Agency, Ltd. (JCR): A+
Rating and Investment Information, Inc. (R&I): A

Third-party Assessment of Eligibility
JCR Sustainability Bond RatingThis sustainability bond has been externally evaluated by the Japan Credit Rating Agency (JCR)
regarding its conformance with the Green Bond Principles 2021, the Social Bond Principles 2021, andthe Sustainability Bond Guidelines 2021 of the International Capital Market Association (ICMA) and theFundprocurement
through ESG
financeIssuance ofSustainabilityLinked Bonds
Issuance ofSustainability
Bonds
Fuyo General
Lease Co.,
Ltd. No.17

Green Bond Guidelines 2020 of the Ministry of the Environment.
JCR Sustainability Bond Rating

Each Group
Company's
Environmental
and Social
initiatives（1945KB）

208

Use of Proceeds for this Sustainability Bond
This sustainability bond (“Fuyo CSV Bond”) is intended to refinance the following green projects andsocial projects among the important initiatives related to the Group’s CSV.

unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)
Fuyo General
Lease Co.,
Ltd. No.20
unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)(News release as of August 20, 2021: Issued Sustainability Bond (Fuyo CSV Bond))

Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy

Announcement of Investment in the
Sustainability Bond
These are the investors who have announced that they will invest in the Sustainability Bond.

List of investors who have announced investment (Japanesealphabetic order)(As of September 10, 2021)
Asset Management One Co., Ltd.
Izawa Metal Co., Ltd.
The 77 Bank, Ltd.
Jodo Shu
Tokio Marine Asset Management Co., Ltd.
The Toa Reinsurance Company, Limited
Nissay Asset Management Corporation
Higashi-Nippon Bank, Ltd.
Mitsui Sumitomo Insurance Company, Limited
Sumitomo Mitsui DS Asset Management Company, Limited
Sumitomo Mitsui Trust Asset Management Co., Ltd.

209

Independent
assuranceMitsubishi UFJ Trust and Banking Corporation

Reporting
Scheduled to be updated after fund allocation

Disclaimer

Disclosure Policy

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> Sustainability > Fund procurement through ESG finance> Fuyo General Lease Co., Ltd. No.17 unsecured corporate bonds (limited to corporate bonds with a special agreement on the samepriority) (Green Bond)

Fuyo General Lease Co., Ltd. No.17 unsecured
corporate bonds (limited to corporate bonds with a
special agreement on the same priority) (Green
Bond)

Outline of the Green Bond
Name

Sustainability

Fuyo General Lease Co., Ltd. No.17 unsecured corporate bonds(limited to corporate bonds with a special agreement on the samepriority) (Green Bond)

Fuyo Lease
Group's CSV

Application period

October 26, 2018

Payment dateNovember 2, 2018

Solving Social
Issues throughBusiness

Issue duration

Issuance amount

Coupon rate

Use of proceeds

Ratings

Environmental
Report5 years

Social Report

10 billion yen

0.210%

Governance andManagement

The capital raised through the Green Bond will be used for theredemption of commercial paper issued to fund existing solar
power generating facilities owned by the Company's subsidiaryand for capital investment in solar power generating facilities
under construction by the Company's subsidiary.

Each Group
Company's
Environmental
and Social
initiatives

Japan Credit Rating Agency, Ltd. (JCR): A
Rating and Investment Information, Inc. (R&I): A-

Fund
procurement
through ESG
financeIssuance ofSustainabilityLinked Bonds

211

Third-party assessment of green bondeligibility
JCR green bond rating
Fuyo General Lease acquired a third-party rating from the Japan Credit Rating Agency, Ltd. (JCR) of
Green 1, the highest score in the JCR Green Bond Rating system with regards to green bond eligibility.

JCR Green Bond Rating（559KB）

Ministry of the Environment Financial Support Programme forGreen Bond Issuance
The acquisition of a third-party rating makes the bond eligible for a subsidy from the Japanese Ministryof the Environment 2018 Financial Support Programme for Green Bond Issuance.
Financial Support Programme for Green Bond Issuance (Ministry of the Environment)
List of Notification of Decisions to Grant the Subsidy (Ministry of the Environment)

Announcement of investment in the Green
Bond
These are the investors who have announced that they will invest in the Green Bond.

List of investors who have announced investment (Japanesealphabetic order)(As of October 26, 2018)

Issuance ofSustainability
Bonds
Fuyo General
Lease Co.,
Ltd. No.17
unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)
Fuyo General
Lease Co.,
Ltd. No.20
unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)

Participation in
Initiatives andThird-Party
Evaluation

Oita Bank Co., Ltd.

Editorial Policy

Saitama Medical University
The Sugamo Shinkin Bank

Independent
assurance

Tokio Marine Asset Management Co., Ltd.
Nippon Densetsu Kogyo Co., Ltd.
Higashi-Nippon Bank, Ltd.
Sumitomo Mitsui Trust Asset Management Co., Ltd.
Mitsubishi UFJ Kokusai Asset Management Co., Ltd.
Mitsubishi UFJ Trust and Banking Corporation
The Rokinren Bank

Reporting
Allocation of capital raised212

It is planned to allocate the capital raised through the Green Bond to the redemption of commercial
paper issued to fund existing solar power generating facilities owned by the Company's subsidiary andto capital investment in solar power generating facilities under construction by the Company's
subsidiary.

Effect on improving the environment
The total annual effect on reduction of CO2 emissions from the eligible projects covered by the Green
Bond will be 43,495 tons and total annual electricity generated will be 98,428MWh.
(Theoretical value based on output standard as of December 20, 2019)

Annual Review
As a result of an annual review by Japan Credit Rating Agency, Ltd. (JCR), compliance with the Green
Bond Principles and the Ministry of the Environment's Green Bond Guidelines has been confirmed, and a
JCR Green Bond Evaluation of "Green 1" has been obtained.
Green Bond Review PDF（201KB）

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Privacy policy

Disclosure Policy

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> Sustainability > Fund procurement through ESG finance> Fuyo General Lease Co., Ltd. No.20 unsecured corporate bonds (limited to corporate bonds with a special agreement on the samepriority) (Green Bond)

Fuyo General Lease Co., Ltd. No.20 unsecured
corporate bonds (limited to corporate bonds with a
special agreement on the same priority) (Green
Bond)

Outline of the Green Bond
Name

Sustainability

Fuyo General Lease Co., Ltd. No.20 unsecured corporate bonds(limited to corporate bonds with a special agreement on the samepriority) (Green Bond)

Fuyo Lease
Group's CSV

Application period

July 12, 2019

Payment dateJuly 22, 2019

Solving Social
Issues throughBusiness

Issue duration

Issuance amount

Coupon rate

Use of proceeds

Ratings

Environmental
Report5 years

Social Report

5 billion yen

Governance andManagement

0.150%

The capital raised through the Green Bond will be used to offer
financial products that provide incentives to join the new 100%
renewable energy initiative aimed at small- and medium-sizedenterprises (the so-called “Japan RE100”).

Japan Credit Rating Agency, Ltd. (JCR): A
Rating and Investment Information, Inc. (R&I): A-

Third-party assessment of green bondeligibility

214

Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
financeIssuance ofSustainabilityLinked Bonds

Ministry of the Environment Financial Support Programme forGreen Bond Issuance
The Fuyo Lease Group's Green Bond was selected as a model case for the fiscal 2019 Green Bond
Issuance by the Ministry of the Environment, and June 28th, 2019 it was announced that the Ministry of
the Environment and certification bodies (E&E Solutions Inc. and Japan Credit Rating Agency, Ltd.) had
verified the conformity of the framework for issuing of the Green Bond with the Green Bond Guidelines,
2017.
Conformity results for the Guideline of a model case for fiscal 2019 Green Bond Issuance. (Ministryof the Environment)
Pre-issuance Report

Announcement of investment in the Green
Bond
These are the investors who have announced that they will invest in the Green Bond.

List of investors who have announced investment (Japanesealphabetic order)(As of July 12, 2019)
THE SEISHIN SHINKIN BANK.
Tokio Marine Asset Management Co., Ltd.
THE BANK OF NAGOYA, LTD.

Issuance ofSustainability
Bonds
Fuyo General
Lease Co.,
Ltd. No.17
unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)
Fuyo General
Lease Co.,
Ltd. No.20
unsecured
corporatebonds(limited tocorporatebonds with a
specialagreement on
the samepriority)(Green Bond)

Hanno-Shinkin Bank.

Participation in
Initiatives andThird-Party
Evaluation

Sumitomo Mitsui Trust Asset Management Co., Ltd.

Reporting

Editorial Policy

Allocation of capital raised

Independent
assurance

As of the end of July 2020, the allocation of capital raised for the Green Bond is as follows:We plan tocontinue updating our website annually with disclosures related to the latest information on the
allocation of capital raised through green bonds.

Amount raised“Fuyo 100% Renewable Electricity
Declaration Support Program”
Program A (Green Bond)

5 billion yen

215

Amount ofcapital allocated(End of July
2020)

102 million yen

Positive environmental impacts
Because it is difficult to individually calculate the reduction of carbon dioxide emissions and otherpositive environmental impacts for the wide range of properties subject to the Green Bond, the program
execution amount, the number ofusers, expected positive environmental impacts for each property type,as well as the number of organizations participating in RE100 and the 100% Renewable Electricity
Declaration RE Action since the start of the program are disclosed.

“Fuyo 100% Renewable Electricity Declaration Support Program” Program A (Green
Bond) handling results (total amount spent/number of users/expected positiveenvironmental impacts)

Property type

1. Renewable energy equipment (solar power, wind
power, hydropower, biomass power including
biogas, and geothermal power for private use)

Total
amountspent on
Program A(Oct. 2019
to July
2020）―

Program or equipment with 10% or more improved
energy efficiency*1)

Projects with 10% to 30% improved energy
efficiency

Newly createdrenewable energy(powergenerated):0MW-dc

Promotion of low
carbon anddecarbonization incompanies and

2. Energy-efficient equipment (equipment coveredby the Eco-Lease Promotion Project Subsidy

Projects with 30% or more improved energy
efficiency

Expected
positiveenvironmental
impacts―

2 million yen /1 organization

organizations
participating inRE100 and the
100% Renewable
Electricity
Declaration RE
Action3. Devices that are compliant with the Act on
Promoting Green Procurement

Information equipment, office automationequipment, etc.

89 million yen/ 11organizations

Electric vehicles, hybrid vehicles*2, plug-in hybrid
vehicles*2, fuel-cell vehicles

11 million yen/1organization*1

This excludes energy-efficient equipment that uses coal. In cases where non-coal fossil fuels suchas oil and natural gas are used, it is possible to either reduce greenhouse gases or improve energy
efficiency by at least 30% for all initiatives in buildings and other facilities including initiatives
related to renewable energy, and this is limited to the replacement of equipment.

*2

Hybrid vehicles/plug-in hybrid vehicles are limited to those that satisfy emissions of less than 75 g
CO₂-p/km (CO2 emissions per person when traveling 1 km).
216

Participation in RE100 and the 100% Renewable Electricity Declaration RE Action

End of July 2019
Number ofdomestic
participatingcompanies
andorganizations

20 companies

RE100

100%
Renewable
Electricity
Declaration
RE Action

End of July 2020

Power
consumption(Total)Approx. 17
TWhNumber ofdomestic
participatingcompanies
andorganizations

Power
consumption(Total)35 companies

Approx. 26
TWh0 organizations

0 GW

71

Approx. 914(Established in
Oct. 2019)(Established in
Oct. 2019)organizations

GWh

Annual Review
In an annual review by the Japan Credit Rating Agency, Ltd. (JCR), compliance with the Green Bond
Principles and the Ministry of the Environment’s Green Bond Guidelines has been confirmed, and a JCR
Green Bond Evaluation of “Green 1” has been obtained.
Green Bond Review Results

Disclaimer

Disclosure Policy（488KB）

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> Sustainability> Participation in Initiatives and Third-Party Evaluation

Participation in Initiatives and Third-Party
Evaluation
UNGC: United Nations Global Compact

Sustainability

The United Nations Global Compact (UNGC) is avoluntary initiative in which companies andorganizations act as good members of society andFuyo Lease
Group's CSV

participate in the creation of a global framework forsustainable growth by demonstrating responsible andcreative leadership. We became a signatory in January

Solving Social
Issues throughBusiness

2018. We support the 10 principles of the UNGC in
four categories (human rights, labor, environment, and anticorruption) and work toward making them happen.

Environmental
Report

TCFD: Task Force on Climate-related Financial Disclosures

Social Report
The Task Force on Climate-related Financial
Disclosures (TCFD), which was set up by the Financial

Governance andManagement

Stability Board (FSB), an international organization ofmajor countries' central banks and ﬁnancial regulators,

Each Group
Company's
Environmental
and Social
initiatives

presents a framework for disclosures relating toclimate change. In May 2019, Fuyo Lease expressed
its support for the recommendations set out in the ﬁnal report of
the TCFD and is preparing to make the required disclosures.

Fundprocurement
through ESG
finance

RE100：Renewable Electricity 100
RE100 is a global initiative run by the Climate Group,
an international NGO in partnership with CDP. Member

Participation in
Initiatives andThird-Party
Evaluationcompanies commit to, and publish, a target of 100%
renewable energy use in their businesses by 2050.
Fuyo Lease became a member in September 2018,
announced targets of 50% renewable energy use by2024 and 100% by 2030, and is taking action to make them happen.

Editorial Policy
Independent
assurance

218

JCLP: Japan Climate Leaders' Partnership
In February 2018, we became a supporting member of
JCLP, a coalition of companies working toward asustainable, zero-carbon society, and an executive
member in December 2018. As well as engaging in ourown zero-carbon initiatives, we are involved in a broad
range of activities that address climate change, suchas developing and providing solutions that will help thetransition to a zero-carbon society, collaborating with global
networks, and making policy recommendations.

EMF: Ellen MacArthur Foundation
The Ellen MacArthur Foundation (EMF) is aninternational initiative whose purpose is to accelerate
the transition to the circular economy. We became amember of the foundation in November 2020 toacquire knowledge of the circular economy andcollaborate with other companies and researchorganizations.

Financial Behavior Principles for the Formation of a Sustainable Society：Principles for
Financial Action for the 21st Century
The Principles for Financial Action for the 21st Century
were formulated as the policy recommendation for
financial institutions seeking to fulfill their roles andresponsibilities in forming a sustainable society. Fuyo
Lease signed the principles in June 2016.

Third-Party Evaluation
The Fuyo Lease Group is reinforcing its environmental, social, and governance (ESG) activities andpursuing CSV initiatives to solve social issues. Our ESG practices have been highly evaluated by thefollowing organizations, which rate companies based mostly on their non-financial information.

Inclusion in ESG-Related Stock Indices
FTSE4Good Index Series
The FTSE4Good Index Series is a set of stock indexes
operated by FTSE Russell of the London Stock
Exchange Group to measure the performance ofcompanies that demonstrate strong ESG practices.

219

FTSE Blossom Japan Index
The FTSE Blossom Japan Index is a set of stockindexes operated by FTSE Russell of the London Stock
Exchange Group to measure the performance ofJapanese companies that demonstrate strong ESG
practices. The FTSE Blossom Japan Index is one of five
ESG indexes selected by the Japanese Government
Pension Investment Fund (GPIF) to be tracked in orderto manage its ESG investment.

MSCI Japan ESG Select Leaders Index
The MSCI Japan ESG Select Leaders Index is a stockindex operated by MSCI Inc. to target Japanesecompanies in various industries that have high ESG
performance. The GPIF also manages its ESG investment bytracking this index.
*

The inclusion of Fuyo General Lease in any MSCI Index, and the use of MSCI logos, trademarks,
service marks or Index names herein, do not constitute a sponsorship, endorsement or promotionof Fuyo General Lease by MSCI or any of its affiliates. The MSCI Indexes are the exclusive propertyof MSCI. MSCI and the MSCI Index names and logos are trademarks or service marks of MSCI or its
affiliates.

S&P/JPX Carbon Efficient Index
Jointly developed by S&P Dow Jones Indices LLC. andJapan Exchange Group, Inc., the S&P/JPX Carbon
Eﬃcient Index is designed to adjust the constituent
weightings based on the companies' performance interms of carbon emissions per unit of revenue andenvironmental information disclosure level. The GPIF also
manages its ESG investment by tracking this index.

SNAM Sustainability Index
The SNAM Sustainability Index is an index managed
based on the results of corporate ESG surveys
conducted jointly by SOMPO Risk Management Inc.
and Integrex Inc. Companies whose total ESG scores
exceed a speciﬁed level are included in the index. Fuyo
Lease has been included in the index since 2012.

220

Evaluation of Our Initiatives
ESG Finance Awards Japan
In ﬁscal 2019, in the bond category of the ESG
Finance Awards, in which the Ministry of theEnvironment recognizes ﬁnancial institutions that are
actively engaged in ESG ﬁnance and companies
engaged in environmentally sustainable management,
we received the Gold Prize (Minister's Prize, theMinistry of Environment) in recognition of our efforts
in the Fuyo 100% Renewable Electricity Declaration
Support Program.

Environmental Communication Awards
The Fuyo Lease Group Integrated Report 2020
received the Excellence Award in the Environmental
Reporting category of the 24th Environmental
Communication Awards hosted by the Ministry of theEnvironment and Global Environmental Forum.

Platinum Kurumin
The "Kurumin" accreditation mark is issued tocompanies that have implemented the General
Employers Action Plan under the Act on Advancementof Measures to Support Raising Next-Generation
Children and whose initiatives have been recognized.
In ﬁscal 2017, we received a special certiﬁcation
known as the Platinum Kurumin, which is awarded toKurumin-certiﬁed companies that have demonstrated a higher
level of commitment.

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> Sustainability> Editorial Policy

Editorial Policy

About this website

Sustainability

On this website, we report on Fuyo Lease Group's approach to sustainability and on the main activities
carried out by the Group in fiscal 2020 in as much detail as possible. Additionally, details on the activities
carried out by group companies have been included, so please have a look at these.

Fuyo Lease
Group's CSV

Each Group Company's Environmental and Social initiatives

Since fiscal 2018, we have also published an Integrated Report, which details how social and corporate

Solving Social
Issues throughBusinessvalue is created through our businesses from medium- to long-term perspectives. Please also take aEnvironmental
Reportlook at this.
"Integrated Report" PDF download

Social Report
The Group would like to receive opinions and impressions from a wide range of stakeholders which wewould like to refer to in future activities and reports. Please send us questions, comments, impressions,

Governance andManagement

and other feedback you might have.
For questions, comments, and other feedback, please click here.

Reporting organization
Fuyo General Lease Co., Ltd. and its 52 consolidated subsidiaries and 8 affiliated companies

Reporting period

Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance

Fiscal 2020 (April 1, 2020 to March 31, 2021)⋆⋆

Some reports include reports from outside the reporting period.

Update time

Participation in
Initiatives andThird-Party
Evaluation

September 2021 (previous information was updated in October 2020)⋆⋆

Editorial Policy

The English version was updated in October 2021.

Independent
assurance

Reference guidelines
In preparing this report, we have referred to the Global Reporting Initiative (GRI), GRI Standards,
Ministry of the Environment's Environmental Reporting Guidelines 2018, and Japan Standards
Association's ISO26000: 2010 Social Responsibility Guidance.

222

For inquiries and comments regarding the CSV activities of Fuyo Lease Group,
please contact:
Fuyo General Lease Co., Ltd.
Creating Shared Value Promotion OfficeTEL+81-3-5275-8809

We welcome any questions, comments, impressions, and other feedback you might have.

Contact us here

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> Sustainability> Independent assurance

Independent assurance

Sustainability

Fuyo Lease
Group's CSV
Solving Social
Issues throughBusiness
Environmental
ReportSocial Report
Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance224

Disclaimer

Disclosure Policy

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> Sustainability> "Integrated Report" PDF download"Integrated Report" PDF download"Integrated Report 2021""Integrated Report 2020""Integrated"Integrated

Report 2021"

Report2020"（4761KB）（5649KB）

Sustainability

Fuyo Lease
Group's CSV

Consolidated
financialstatements
2020（1214KB）

CSR Website
2020 Archive（13151KB）"Integrated Report 2019""Integrated Report 2018""Integrated"Integrated

Report2019"

Report2018"（5378KB）（6714KB）

CSR Website
2019 Archive"Integrated
Report2018" full

（11487KB）

version（7645KB）

Solving Social
Issues throughBusiness
Environmental
ReportSocial Report
Governance andManagement
Each Group
Company's
Environmental
and Social
initiatives
Fundprocurement
through ESG
finance
Participation in
Initiatives andThird-Party
Evaluation
Editorial Policy
Independent
assurance

226

Disclaimer

Disclosure Policy

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227