Responsible Investment Report2023

Responsible Investment
Report 2023

Table ofContents1
2
3Overview of Responsible
Investment• Overview of responsible investment• Framework for responsible investment• Policies for responsible investment

3
4
6

To Achieve Carbon Neutrality ininvestment portfolio• Overview of Net Zero Transition Plan

12

ESG Investment Report• Our history for ESG investment• ESG integration• Positive/Negative screening• ESG-themed investment

20
21
28
30

4

Report on Stewardship Activities• Basic approach and processes• Our history for stewardship activities and review• Examples of engagements• Voting policy and voting records• Message from the chairperson of the responsible
investment committee

38
40
44
51
59

Appendix61

Responsible Investment
Report 2023

Overview of Responsible
Investment

Responsible Investment
Report 2023

Real estate

AUM

As a responsible investor

33

Cash

Open foreign
bonds

Equitytrillion JPY※as of Mar 2023

Others
2%

4%
4%
3%
17%
8%

Loans

55%

7%

Public & corporate bonds

Hedgedforeign bonds

ESG-themed investment
Accumulated investment
amountEngagement
Of which climate solution
investment

1,600 bn JPY
内訳

SDGs bonds

540bn JPY
Impact investing

100bn JPY
3

710bn JPY

Number of engagement

Of which executives interviewed

188

46％

companies

SDGs projects

600bn JPY
Others380bn JPY

AUM coverage of engagement (within domestic listed equities )Accumulated 3years

87％

FY202261％

Responsible Investment
Report 2023

Overview of responsible investment

1

◼

◼

Responsible Investment Committee

In FY2022—in addition to deliberations on voting on major
agenda items and revision of the criteria for exercising voting
rights—the Committee reported on the GHG emission reduction
status of Dai-ichi Life’s investment portfolio and discussed theformulation of a Policy on Transition Finance.

Framework for responsible
investment

Its policies of responsible investment areformulated based on deliberations at the
Responsible
Investment
Committee—themajority of which consists of external
members—and especially important matters arereported to the Board of Directors andExecutive Management Board. In addition, Daiichi Life monitors and discusses the progress of
initiatives promoted by entire investment
department through the Responsible Investment
Meetings attended by members involved in
responsible investment.

4

In FY2022, the meetings were held to discuss the promotion of
responsible investment. Details included the progress of the
responsible-investment initiative plans of each investment
department, monitoring the positive impact of Dai-ichi Life’s
investment projects, ESG analysts sharing their ESG research
results and other matters.

Board of Directors

Responsible investment
promotion structureDai- ichi Life has established the Responsible
Investment
Committee
andResponsible
Investment Meeting to promote both thediscussion of initiatives related to responsible
investment from various perspectives and toincrease the sophistication of such efforts.

Responsible Investment Meeting

Executive Management Board
Reporting on activities such as revising important policies,
exercising voting rights, and engaging in dialogue

Responsible Investment Committee

External committee members: 3/ Internal committee members: 2

Main agenda: deliberations on responsible investment-related policies and important bills
for which voting rights are exercised

ReportingResponsible Investment Meeting
Main agenda: formulating responsible investment-related policies, reviewing PRI assessment, and following up on
the progress of individual initiatives

Sharing global trends, etc.
related to responsible investment

ESG investments

Investment departments

Initiative results / progress report

Responsible Investment
Department/ ESG analysts

Stewardship activities

Responsible Investment
Report 2023

Committee Members
Overview of responsible investment

Organization and Track
Record of the Responsible
Investment Committee

In addition to external experts, Dai- ichi Lifeappoints officers in charge of compliance to thecommittee as members to deliberate and confirm
important policies on responsible investment,
exercising voting rights on important resolutions
and other matters by from a stance fully
addressing any conflicts of interest in life
insurance contracts.

5

External committee members

The majority of the members of the Responsible
Investment Committee are external experts withextensive knowledge in management strategy,
governance, ESG investment, and a variety ofother subjects enabling a system that reflects
broad external opinions in the Committee.

Internal committee members

1

Framework for responsible
investment

Name/Title

Meetings＜2022/4～2023/3＞

Attendance/No. of Meetings

Kazuyuki Shigemoto
Chairperson
Managing Executive Officer incharge of Responsible Investment
Dept.

3/3

Satoshi Takemoto
Executive Officer in charge ofCompliance Control Dept.

3/3

Tetsuya Hishida
Partner/Auditor
Industrial Growth Platform, Inc.

3/3

Haruka Matsuyama
Attorney at Law and Partner
Hibiya Park Law Offices

3/3

Kikuo Kuroiwa
President
Kuroiwa Associates

3/3※ Verified there were no problems with exercise of judgement
at departments responsible for managing conflicts of interest

PeriodMain deliberation agenda/reported matters

2022/6＜Discussion Agenda＞•Exercise of voting rights on important resolutions*＜Reported matters＞•Progress toward GHG emission reduction targets
in our portfolios

2022/9＜Discussion Agenda＞•Policy on “Transition Finance”＜Reported matters＞•Stewardship Activities Report•Joining PRI Human Rights Initiative"ADVANCE”•Responsible Investment Report 2022

2023/3＜Discussion Agenda＞•Exercise of voting rights on important resolutions*•Revision of voting standards＜Reported matters＞•Responsible Investment Policy 2022
•2021 PRI assessment results•Responsible investment activity
report/engagement survey results

Responsible Investment
Report 2023

◆ Basic stance on responsible investment✓ We will promote responsible investment through both ESG investment and stewardship activities while also
participating in initiatives and collective engagement in order to maximize the effects of such investment.

Policies for responsible
investment✓ In terms of all asset management policies and investment processes, we will endeavor to consider
sustainability according to asset- and region-specific characteristics and continuously improve the corresponding
methods.

Basic Policy on
Responsible Investment✓ We will work to create positive impacts for achieving a sustainable society. We will not invest in any businessthat violates laws or public order, any business related to the manufacturing of inhumane weapons, any businessthat has a significant negative effect on climate change, regional environments, society, or human rights, or any
business that risks having any of the above effects.

Overview of responsible investment

1

We have established a "Basic Policy on
Responsible Investment" as our highest level
policy on responsible investment, which
defines the purpose and basic stance of
responsible investment, as well as our policy
on compliance with the Japanese Stewardship
Code. Based on this policy, we haveformulated policies for each period, such as a
medium-term policy and a single-year policy,
as well as a policy for each type of financing,such as a "Policy for Transition Financing",
and we are promoting efforts to advanceresponsible investment based on thesepolicies.

6◆ Commitment to the Japan’s Stewardship Code✓ We support the purport of Japan’s Stewardship Code. We fulfil our stewardship responsibilities as an institutional
investor in accordance with the Basic Policy on Responsible Investment.
✓ In order to promote the enhancement of the corporate value of the investee from a medium- to long-term
perspective, we will continuously engage with the investee on governance, environmental and social issues, inaddition to management strategy, financial strategy, and shareholder return policy, etc., and strive to improveissues based on a shared understanding.
✓ To fulfill our stewardship responsibilities, we regularly conduct self-evaluations aimed at the improvement ofstewardship activities, and we publish those results together with the outcomes of stewardship activities, including
engagement with investees.

The full text of the policy is disclosed on our website. https://www.dai-ichi-life.co.jp/english/dsr/investment/pdf/ri-report_006.pdf

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Responsible Investment
Report 2023

Promotion of ESG-themed
investment✓
Overview of responsible investment

1

Policies for responsible
investment

Medium-term
Responsible Investment
Policy (through FY2024)
In order to contribute to the creation of a positive
impact on society through the promotion of
responsible investment, the Medium-Term Initiatives
Policy through FY2024 sets a cumulative ESG
investment and financing target of ¥2 trillion, andalso includes the further enhancement of ESG
integration and stewardship activities centered on
engagement in all assets. The Company has alsoestablished a target of ¥2 trillion in cumulative ESG
investments.

In addition, we have positioned addressing climatechange as a top priority theme for responsible
investment, and through our investments and loans,
we will contribute to transitions toward reducing
GHG emissions and realizing a decarbonized society,while promoting the decarbonization efforts of ourportfolio companies through engagement-based
stewardship activities.

7✓

Creating positive impacts onsociety through investment tofacilitate solutions to social
issuesMaking cumulative ESGthemed investment of over JPY
2 trillion by the end of FY2024

Sophistication of ESG
integration✓✓(Approx. JPY 1.6 trillion at the end of
FY2022)

Continuing the sophisticationof ESG integration for all
assets based on theircharacteristics
Continuously researching andincorporating important ESG
themesPromotion of stewardship
activities✓

Oriented toward stewardship
activities centered on
engagement for all assets,taking characteristics of each
asset or each region and theextent of our influence as aninvestor into accountClimate change
Reduction of GHG emissions
in our investment portfolio

Promotion of investment to help solve climatechange✓ Achieving a 25% reduction in GHG emissions
in our portfolio of listed equities, corporate
bonds, and real estate (Compared to FY2019)✓ Making cumulative investments in climatechange solutions* of over JPY 1 trillion by theend of FY2024 (Approx. JPY 710 billion at the end of
FY2021)*Investment to facilitate solving climate change, such as green bonds
and renewable energy power plant projects

Creation of positive impacts✓ Avoided GHG emissions* in FY2024 Approx.
1.5 million tCO2e* Renewable energy generating business for which reduction effects havebeen disclosed. Target amount of avoided GHG emissions to be reviewed
annually.

Engagement with investee companies✓ Conducting focused engagement with top 50
GHG emitting companies of our portfolio to
encourage them to set reduction target
consistent with the 1.5°C target and formulate
and implement strategies to realize themResponsible Investment
Report 2023

Overview of responsible investment

1

Policies for responsible
investment

Responsible Investment
Policy 2023
In FY2023, we will continue our efforts toachieve each of the goals set forth in theMedium-Term Initiatives Policy by upgrading
our GHG emissions monitoring system andpromoting investment and financing forclimate change solutions. In stewardship
activities, we will work to enhance thesophistication of our activities by setting thelatest ESG issues, such as "cyber security," asthemes for engagement.

8

ESG Investment◆ Creation of positive impacts✓ Promotion of ESG-themed investment aimed atachieving the medium-term goals✓ Encouraging issuers to implement impact disclosure
through engagement◆ Climate Change✓ Sophistication of the GHG emissions monitoring
system of our portfolio✓ Active promotion of investment in climate changesolutions to support efforts toward decarbonization,
including green, transition, and impact financing◆ Sophistication of the ESG research andintegration system✓ Conducting in-depth research on our priority ESG
themes (climate change, strengthening governance,
human rights and diversity, natural capital)✓ Continuing efforts to sophisticate ESG integration for
all assets, taking their characteristics into accountStewardship Activities◆ Engagement aimed at resolving
important issues✓ Improving engagement methods to help companies
to identify and resolve issues, including by
incorporating the issues into engagement themes,
based on our findings on ESG themes◆ Strengthening climate change-related
engagement✓ Encouraging top 50 GHG emitting companies of ourportfolio to create an appropriate roadmap to achieve
net-zero emissions by 2050

◆ Emphasis on engagement regarding
management strategy✓ Sharing issues with investees while confirming
consistency between corporate purpose andbusiness models✓ Ascertaining medium- to long-term investment
strategies, including investment in human capital andintellectual properties, and sustainable businessstrategies based on the external environment such as
geopolitical risks and coexistence with COVID-19✓ Confirm the status of response to “Cybersecurity”

Promotion of Responsible Investment by Participating in Initiatives✓ Engage in international rulemaking through participation ininternational initiatives such as GFANZ and Net Zero AOA,
working with a variety of stakeholders including other financial
institutions, corporations, and governments.
✓ Actively participate in collaborative engagements and exert
influence on corporations

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Overview of responsible investment

1

Policies for responsible
investment

1

Policy on Transition
finance
To achieve a decarbonized society, it isimportant to steadily promote a long-termtransition strategy focused on industries thathave high GHG emissions.
To contribute to achieving a decarbonizedsociety, Dai-ichi Life has formulated a basic
stance and approach related to transition
finance. By referring to the GFANZ’ four
financing strategies and others, Dai-ichi Lifeaims to support the achievement of net-zeroemissions by 2050 by actively providing
financial support to companies pursuingtransition strategies.

9

Dai-ichi Life chooses to take investment actions prioritizing the realization of
long-term carbon neutrality for society as a whole.

42

When making investment decisions, Dai-ichi Life independently examines thevalidity and feasibility of companies’ Transition strategies in terms of ensuring
investment returns in addition to alignment with key Transition Finance guidelines.

3

Dai-ichi Life will continuously review its decision criteria used in examining
companies’ Transition strategies in light of the external environments
surrounding the Transition, situations of technological innovations and otherelements.

Based on the insights obtained in the detailed examination process ofTransition Finance, Dai-ichi Life facilitates improvements in companies’
Transition strategies and more effective initiatives through the engagements.

The full text of Policy on Transition Finance has been disclosed on Dai-ichi Life's website.
(https://www.dai-ichi-life.co.jp/english/dsr/investment/pdf/ri-report_008.pdf)

Responsible Investment
Report 2023

Awarded Gold Award (Minister of the Environment Award)Awarded Gold Award at
the ESG Finance Awards
Japanin the Investor Category at the Ministry of the Environment’s 4th ESG Finance Awards JapanIn FY2022, in addition to further upgrading responsible investment by setting new targets in the Medium-term
Responsible Investment Policy, we have also formulated our basic approach to "transition finance.” Inrecognition of these efforts, we received our second Gold Award at the 4th ESG Finance Awards Japan(Investor Category) hosted by the Ministry of the Environment.

Reasons for selection as a Gold Award winner in the Investor Category
 Dai-ichi Life has established a new Medium-term Responsible
Investment Policy that includes steps to create a positive impact
on society and to promote stewardship activities, while making
progress on its medium-term ESG investment goals ahead ofschedule.

▲Tetsuya Kikuta, Group CEO, Dai-ichi Life Holdings, Inc.
* This award was presented to our Company (The Dai-ichi Life
Insurance Company, Limited).

10 Dai-ichi Life’s Policy on Transition Finance focuses on
engagement with high-emission companies instead of divestment
and includes a clear plan to address the medium- to long-term
increase due to transition finance in its portfolio GHG emissions.

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To Achieve Carbon
Neutrality in investment
portfolio

Responsible Investment
Report 2023

To achieve Carbon Neautality ininvestment pofrfolio

2Foundations

Strategies

Metrics
and targets

To formulate a credible transition plan, the Company
refers to the transition-plan framework guidance of
the TCFD and GFANZ, etc.
As a life insurance company, Dai-ichi Life promotes
net-zero initiatives as both an institutional investor(by investing insurance premiums received frompolicyholders) and an operational company (byrunning and managing life insurance business).
For the full text of the "Net Zero Transition Plan,"please refer to the website of Dai-ichi Life Holdings.
Link：Net Zero Transition Plan

Roadmap to achieving net-zero emissions

Implementation Strategy
Expand assets
covered byemission reduction
targets and analyze
emissions

Overview of the transition plan

Overview of the Net
Zero Transition Plan

Objectives of the transition plan

Support transition to a
low-carbon society andcreation of environmental
innovation throughinvestments

Engagement Strategy

Emissions reduction initiatives
related to business activities(shifting to renewable energy,saving energy, and reducing
total paper usage, etc.)

As an institutional investor

As an operational company

Financed emissions (Scope 3 Category 15)

CO2 emissions from business activities(Scope 1 and 2)

Investments in climate solutions

Positive impact via investments
Number of companies engaged with

GovernanceOpinion andrule-making throughglobal financeinitiatives

Encourage
investees’
initiatives

CO2 emissions from business activities(Scope 3, excluding Category 15)

Governance and promotion structure on climate change issues
Governance structure that reports tothe Executive Management Board
and Board of Directors and isoverseen by the Board of Directors

Introduction of sustainability metrics
as executive remuneration assessment
criteria (including progress on CO2emission reduction)

Promotion by theGroup Sustainability Committee
and Group ERM Committee

Transition plan: Oversight: CSuO*, Administration: Corporate Planning Unit,
Implementation: relevant departments of Dai-ichi Life

Skills and culture
12

Building awareness among Group officers and employees* Chief Sustainability Officer

Responsible Investment
Report 2023

Implementation Strategy
To achieve Carbon Neautality ininvestment pofrfolio

2

Overview of the transition plan

Initiatives to achieve
net-zero emissions
through investments
To contribute to achieving a sustainable society
which is essential for the well-being of all
while securing stable investment returns overthe medium to long-term, Dai- ichi Life
promotes
responsible
investments
that
contribute to resolving material issues related to
local communities and society.
Dai- ichi Life consideres climate change to be
one of the most important topics in terms of
responsible investment, and Dai- ichi Life
contributes to GHG emission reduction as wellas the transition to achieve a decarbonizedsociety through investments. In addition,
through stewardship activities based on
engagement, Dai- ichi Life also promotes thedecarbonization
initiatives
ofinvesteecompanies.

Expand assets coveredby the emission
reduction targets
and analyze emissions◼ Expand the assets coveredby the investment-portfolio
emission reduction targets,
which included listed
equities, corporate bonds,
and real estate before, toalso include corporateloans.
◼ Regularly measure andanalyze the GHG emissionsof investee companies byutilizing multiple indicatorsthat include the WACI *, andthen reflect those results inengagement activities andinvestment decisions (ESG
integration).

Support the transition to
decarbonization and thecreation of environmental
innovations throughinvestments◼ Actively pursue climate solution
investments that contribute toresolving climate change issues,
aiming for a cumulative total of¥1 trillion by FY2024.

◼ In terms of creating a positive
impact through investments, aim
to achieve annual avoided GHG
emissions of 1.5 million tons
CO2 e by FY2024.
◼ Formulate a Policy on Transition
Finance, and actively supply funds
aimed at transitioning todecarbonization.
◼ Implement negative screening to
exclude new thermal power plant
projects that use fossil fuels as wellas similar pursuits from financing.

Engagement Strategy

Support the initiativesof investee companies
through engagement◼ Regarding the top 50 or socompanies in terms of
GHG emissions in Daiichi Life's investment
portfolio, promoteraiseses in the target
setting level related to
GHG emission reductions
as well as improved
initiative effectiveness,etc.
◼ Demonstrate influence as
an investor while also
supporting the initiatives ofinvestee companies
through collaborative
engagement with Climate
Action 100+, the Life
Insurance Association ofJapan, etc.

Communicate views
and participate inrule-making
through global
financial initiatives◼ Participate in GFANZ, aglobal initiative aimed atpromoting thedecarbonization initiativesof financial institutions.
◼ Become a member of the
Principals Group—whichleads GFANZ—andparticipate in affiliatedworking groups to promote
initiatives that include
considering the rolefinancial institutions
should play in the
decarbonization of society
as well as being actively
involved in rule-making.

* WACI: Weighted Average Carbon Intensity

13

Responsible Investment
Report 2023

Metrics

Results

Targets

To achieve Carbon Neautality ininvestment pofrfolio

2

Overview of the transition plan

Financed Emission(Scope 3 Category 15)2022：16％reduction※1(approximately 4.5 million
tons CO2e)2025: 25%reduction*1
2030: 50%reduction*2 Newly set
2050: net zero

Net-zero targets
We have set a goal to achieve net-zeroemissions in our investment portfolio and areworking to achieve it. In order to reduce
financed emissions, we had set an interim
target of 25% reduction by 2025 (compared
to 2020) and have newly set an interim targetof 50% reduction by 2030 (compared to2020). This interim reduction target includes
corporate loans as a target asset.

Climate solution
investments(Cumulative invested amount)

FY2022:
FY2024: ¥1 trillion
approximately ¥710 billion

Creating positive impacts
by investments(Avoided GHG emission per year)

FY2022:
1.23 million tons CO2e

FY2024: 1.5 million tons
CO2e

Number of investees
targetted for engagement

2022: top 55 investees
in investment portfolio

Approximately 50 highest
emitters in investment
portfolio in a financial year

(emission coverage ratio: 72%)

14
* 1 Compared to 2020 (listed equities, corporate bond, and real estate portfolios) *2 Compared to 2020 (listed equities, corporate bonds, real estate, and loan portfolios)Responsible Investment
Report 2023

Breakdown by sector(fiscal year ended M arch 31, 2022)

To achieve Carbon Neautality ininvestment pofrfolio

2

Overview of the transition plan

Emission results andbreakdown by sector
To build a net-zero portfolio by 2050, Dai-ichi Lifehas set interim targets—including reducing
emissions by 25% by the fiscal year ending March
31, 2025 (for listed equities, corporate bonds, andreal estate) and reducing emissions by 50% by thefiscal year ending March 31, 2030 (for listed
equities, corporate bonds, real estate, and loan)—and is steadily promoting initiatives that include
reducing emissions by 16% for the fiscal year
ended March 31, 2022.
Of its investment portfolio of listed equities andcorporate bonds, Dai-ichi Life considers the top 50
companies in terms of emissions—including thepower and steel sectors, which account for a
relatively high percentage of emissions—to behigh-priority engagement targets and is actively
engaging with them.

15

Other

GHG emission
results

24%

10,000 tons
CO2e*1

600
6000

-12%

500
5000

-16%

4000
400

300
3000

200
2000

Transportation

4%

Petroleum
gas
%

6%

Chemicals

Targets-10%537-50%*2
Approx.

472

Power
41%

Steel
18%

-25%
Targets

Approx.

7%

listed equities
and corporate
bonds

-20%

-30%

Approx.

450

-40%

1000
100

-50%

0

2050
net zero
Entire investment
portfolio

-60%

2020

2021

2022

2025

2030

*1

Total Scope 1 and 2 values for Dai-ichi Life’s listed equities, corporate bonds, and real estate portfolio. The figures for listed equities
and corporate bonds were compiled by Dai-ichi Life based on MSCI ESG Research LLC data. The real estate figures were compiled
after being calculated by Dai-ichi Life. Because Dai-ichi Life changed its vendor from S&P Trucost Limited to MSCI ESG Research
LLC, Dai-ichi Life revised the GHG emission results for 2020 and 2021. Note that, when Dai-ichi Life used S&P Trucost Limited data,
the 2022 GHG emissions amounted to approximately 4.7 million tons CO2e (and the 2020 emissions amounted to approximately 6.02
million tons CO2e).

*2

Dai-ichi Life set its interim reduction target for 2030 in line with the NZAOA Protocol. Dai-ichi Life also added corporate loans to theassets covered by its interim reduction target.

Responsible Investment
Report 2023

Positive impact through investments
Breakdown of total cumulative results by FY2022

Climate solution investments
Target: Japan: overseas¥2 trillion
To achieve Carbon Neautality ininvestment pofrfolio

2

Impact investment*2
Investments in andloans for SDG
projects¥60 billion

Overview of the transition plan

Breakdown

ESG-themed investments
Approximately ¥1.6 trillion

¥ 280

30
30

¥ 370

Climate Solution Investments
and Positive Impact

billionClimatesolution investments*1
Approximately ¥710 billion

Dai-ichi Life has reached a cumulative
total of approximately ¥710 billion in
investments that contribute to resolving
climate change issues (climate solution
investments). Dai-ichi Life plans to expand
this amount to at least ¥1 trillion by March
31, 2025.

In addition, we also believes positive
impact on society from such investment
are important, and the annual avoided
GHG emissions from these in FY2022
were 1.23 million tons CO2e (equivalent toapproximately 27% of the portfolio GHG
emissions). we plan to expand this to 1.5
million tons CO2e by FY2024.

16▶ Please refer to P.30~36 for examples of
ESG investment.

billionBreakdown

Target¥1 trillion

Investments in
Breakdown
SDG bonds
210(investments in
160
green bonds, etc.)

Annual avoided GHG
emissions
Approximately
1.23 million tons CO2e

160
120

(investments inand loans forrenewableenergy power
generation
projects, etc.)

FY2024 Target
1.5 million tons
CO2eInvestment projects that are related toresolving climate change issues and for which
it is possible to estimate the greenhouse gas
reduction contribution—such as ofrenewable-energy power generation
projects—or for which the impact has been
disclosed through green bonds, etc.
2013

*1

2014

2015

2016

2017

2018

2019

2020

2021

2022 2023
2022

2024

Climate solution investments: investments that contribute to solving
climate change issues, including investments in and loans for green
bonds as well as renewable-energy power plant projects*2

Dai-ichi Life defines impact investment as an investment
methodology under which investment decisions are made basedon the intention to both secure investment returns and achieve asocial impact (such as changing the social structure).

Responsible Investment
Report 2023

The situation of top 50 companies in Dai-ichi Life's investment portfolio in terms of GHG emissions
TCFD scenario analysis disclosure
1
1
8

To achieve Carbon Neautality ininvestment pofrfolio

2

Quantitative
information
disclosed

12

Companies

14

26

Qualitative only

16

2021/62022/6

Number of companies formulating GHG reduction targets

Dai-ichi Life continues to engage with the top 50
companies in terms of GHG emissions. Amongthese, there is an increasing trend of companies
conducting senario-based analyses to strategically
respond to climate change issues, as well ascompanies promoting the formulation of targets inline with achieving net-zero emissions by 2050.
On the other hand, the number of companies thathave formulated specific roadmaps to achieve thetargets and obtained third-party certification is stillinsufficient, so Dai- ichi Life will continue toencourage companies to take action throughengagement.

1

1
8

7

21

27

30

3
Medium andlong-term
targets *4
set34
companies

21

15

3
10

Sufficiently specific

10 Companies
Somewhat specific

10
20

47

No specifics

2021/6

Only long-term targets set

20

17

15

11

*1
*2
*3
*4

4

31

28

2020/6Disclosure of roadmap toward Carbon neutrality(Evaluation of the specificity of the strategy)

SBT *3 obtained
7 Companies

21

Companies

Less than 10% 23
reduction

11
None 12023/68

2020/6

15

June
2023

19

16

10%
reductionor more12

Impactclassification
category only*1

40

Dai-ichi Life considers engagement with investee
companies to be one of the most important andeffective strategies for contributing to theachievement of a net-zero society.

▶ please refer P.45~46 for examples ofclimate change engagement.

Additionalemissions19

Overview of the transition plan

Engagement with investees

17

3
5

GHG emission reduction results for the most recent
two years (Scope 1 and 2 emission*2)

12022/6

No disclosure

10

None 12023/62020/62021/62022/62023/6

These companies have disclosed information on the degree of impact (minor, moderate, major, etc.), but they have not disclosed quantitative information
Source: M SCI ESG Research LLC
Science Based Targets. This international certification shows that the company has stipulated GHG emission reduction targets aligned with the Paris Agreement.
Targets in line with Japanese government targets (2030: 46% reduction, 2050: carbon neutrality)

Responsible Investment
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Other regional
networks, etc.
To achieve Carbon Neautality ininvestment pofrfolio

2

Overview of the transition plan

Participation in initiatives
Dai-ichi Life participates in the working
groups of GFANZ—which creates Financial
Institution Net-zero Transition Plans:
Fundamentals, Recommendations, andGuidance—and contributed to the creation ofthis report.
In addition, the GFANZ Japan Chapter was
launched in June 2023, and Seiji Inagaki,
Director, Chair of the Board of Dai-ichi Life,
was appointed as the first Chair of theConsultative Group of the chapter. To
encourage Japanese financial institutions toformulate transition plans aimed at
decarbonization, this chapter is used to shareinsights and successful examples while also
supporting cooperation with companies aswell as the relevant ministries and agencies.

18

Co-Chairs (Mark Carney, Michael Bloomberg)
Vice-Chair (Mary Schapiro)

APAC Network◼ Launched in June 2022.
◼ Supports the acceleration of net-zero transition in the APAC
regionDraft guidance on the phaseout of coal-fired
Activity
power plants in Asia (issued in June 2023:
examplefor public consultation)

Principals Group◼ Sets strategic direction and priorities and monitoring progress

Steering Group◼ Supports the Principals Group

Working Groups
Involve in specific tasks, such as guidance development
Activity
exampleFinancial Institution Net-zero Transition
Plans: Fundamentals, Recommendations,and Guidance (issued in November 2022)
Recommendations on elements necessary fora credible net-zero transition plan for financial
institutions to decarbonize the real economy,
as well as key transition finance strategies toachieve the transition.

S
e
c
r
e
t
a
r
a
i
a
t

Recommendations on the coal-fired power
phase-out process in terms of what should
be considered with respect to the credibilityof the transition and phase-out plan, socialand economic impacts, and transparency
and accountability
Japan Chapter◼ Launched in June 2023 (the first GFANZ country chapter in theworld)◼ Supports collaboration among domestic financial institutions, relevant
authorities and companies to accelerate the transition to net-zero inJapan◼ Seiji Inagaki (Director, Chair of the Board, Dai-ichi Life)appointed as the first Chair of the GFANZ Japan Chapter
Consultative Group*

Net-zero alliances, including NZAOA (asset owners), NZBA (banks), and NZAM (asset managers)* Advisory organization consisting of representatives of financial institutions and government agencies, etc.

Responsible Investment
Report 2023

ESG Investment ReportResponsible Investment
Report 2023

2015

3

~

2019

2020

2021

2022

ESG
AnalystCommitted
carbonneutrality/
Set interim
reduction target

Revised
mid-term
responsible inv.
Policy/Policy on
Transition
FinanceJoin
GFANZ・NZAOAJoin
GFANZ WS

Human rights

NaturalCapitalFormulation of ESG
investment policy

ESG Investment Report

Our history for responsible
investment

2016

policy/Framework

SingedPRI

Responsible
Investment Dept.
Responsible
Investment Committee

Our history on
responsible investment

Initiatives
Since the signing of the PRI in 2015, we havebeen working to continuously upgrade our ESG
investment and financing efforts while expanding
them.

In FY2022, we formulated the Basic Policy for
Responsible Investment, Medium-Term
Initiatives Policy for Responsible Investment,
and Initiatives Policy for Transition Finance,with the aim of further upgrading our responsible
investment initiatives. In addition to climatechange, which we have positioned as the mostimportant theme for responsible investment, weare also strengthening our research on important
ESG issues such as natural capital and respect forhuman rights.

20

Initiatives/E
SG
integration/screening

ESG research

Climate change

p.26~
Climate factor
incorporated in ESG
fund

Positive screening

Implementation of ESG
index
in foreign equities

Negative screening
Investment in renewable
Energy power plants
ESGthemed
investment

Investment in SDGs bonds

p.24~

Coal/Weapons

Strengthenof climatechange response

Impact Investment
contributing to regional
revitalization

Thermal power
plantsPromotion of climate
solution investment

Sophistication of impact monitoring/disclosure of positive impacts

Responsible Investment
Report 2023

Asset

3

ESG integration

Corporate

ESG Investment Report

Enhancing Sophisticationof ESG Integration

21

Approach to ESG Integration✓ Evaluate the impact of
ESG factors on enterprisevalue (equities) andcreditworthiness (bonds
sovereign, and loans)based on disclosed
information, evaluations by
ESG analysts, andinformation obtained
during dialogue withinvestees✓ ESG analysts conduct cross-asset analysis ofkey ESG themes and assign ESG scores✓ ESG scores are reflected in internalrankings used to make investment decisions

Real Estates✓ Evaluate the impact on
profitability of thebuilding's environmental
performance✓ Evaluate progress in acquiring environmental
certifications and other ESG elements toreflect in the hurdle rate when making an
investment

Funds✓ Evaluate the ESG
initiatives of funds,
including ESG integration
methods and reporting✓ Interviews on ESG initiatives when selecting
funds and conducting periodic monitoring✓ Score ESG initiatives of funds andincorporate them into investment decisions

Equites
bonds
Loans

Sovereign

Project
Finance
OthersWe integrate ESG into each asset according
to asset liquidity and characteristics tocontinually push forward action that increases
the sophistication of ESG integration.

Perspectives on ESG
Evaluation✓ Credit analysts assess each country's
environmental, human rights, and governanceefforts and reflect them in the internalranks used to make investment decisions✓ Verify whether a project clears the E and S
criteria based on the Equator Principles
and others during due diligence and regularly
monitor theseResponsible Investment
Report 2023

ESG Investment Report3

ESG integration

ESG integration
methodology
Dai-ichi Life optimally integrate ESG
factors into each asset according toliquidity and characteristics and thenappropriately reflects in investment
decision.
ESG analysts select priorty themes fromvarious ESG issues and then conduct
cross-sector research and analysis. Eachcompany is then assigned a comprehensive
assessment score (ESG scoring), and theresults are shared with equity analysts andcredit analysts. Each asset analyst reflects
those information into the evaluation ofeach company.

22

Cross-sector
assessment
ESG analysts
Select important ESG themes/cross-sector research
and analysis
Various
ESGHumananalysts
Climate changerights Governance
ESG issues
etc.

ESG scoring

Major ESG issues andevaluation perspectives

E
Climate change | Climate change risks andopportunities as well as the availability andprogress of a GHG reduction plan

Natural capital | Effects of deforestation, ocean
pollution, waste plastic, etc.

S

G
Governance structure |Fulfillment of functions
by outside directors aswell as appropriate
perticipation and advice
in the Nomination andRemuneration
Committees

Research and analysis of each company

Human rights |The situation in termsof responding to humanrights risks, includingin the supply chain, as
well as human rights
risks identified throughhuman rights due
diligenceevaluation of each company

Diversity |The ratio of womenamong the management
and executives, etc.

Internal rank ofeach company

Equity/credit analysts

Integrated information
disclosure | Situation of
the Integrated disclosureof financial and nonfinancial information

Responsible Investment
Report 2023

ESG analysts

E
Quantitative evaluation

3

ESG Investment Report◼

ESG integration◼

◼

Climate change
integration
In terms of climate change-related risks andopportunities, Dai-ichi Life quantitatively andqualitatively assesses investee companies andconsiders the results of engagement with eachcompany to assign it a score.
More specifically, Dai-ichi Life calculates theimpact of carbon taxes (quantitative
assessment) and considers future opportunities
such as environmental technologies, etc.
(qualitative assessment). In addition, Dai-ichi
Life confirms and evaluates the details of theinitiative in terms of climate change risks,
governance, and other issues throughengagement.

23◼

Qualitative evaluation

Estimate the effects of significant changes in carbon taxes, etc. on the
results.
Calculate the GHG emissions of each company, while also considering
industry-specific risks.
In general, base GHG emissions on Scope 1 and 2, but also add Scope 3
depending on the industry.
Also consider SBT certification acquisition, the formulation of a CO2
reduction plan, etc.

◼

Evaluates corporate opportunities based on
perspectives that include the expectation of expanded
results due to the government’s GX promotion
strategy, etc. as well as the ability to lead an industry
in terms of energy-saving, environmental, and similar
measures that take advantage of outstanding
technologies owned by each company.

Assessment of engagement results with relevant companies
Evaluates the approach and details
in relation to climate change risks

Evaluates company initiatives such as endorsement of TCFD, plans to reduce CO2,
climate related disclosures, and organizational (governance) structures.

ESG scoring
Assign a score to each company based on acomprehensive assessment, andshare it with equity/credit analysts.

Major Initiatives to Improve the Sustainability of Natural Capital
Responsible Investment
Report 2023

Analysis of risks and opportunities

ESG Investment Report3

ESG integration

Key ESG-themed
initiatives to improve
the sustainability ofnatural capital
Amid growing global awareness of the risk ofdamage to natural capital, including
biodiversity, we have set "improve thesustainability of natural capital" as our key
ESG theme.
Based on the analysis of nature-related risks
and opportunities in line with the TNFD, we
aim to contribute to nature positivity byengaging with portfolio companies topromote their efforts while promoting ESGthemed investments and loans that contributeto the improvement of natural capital.

24◼ Analyze nature-related risks and opportunities for equity portfolios in accordance with the LEAP approach (*) proposed by the TNFD
(see next section for detai1ls).
◼ Analytical results are used for engagement with companies and integration into investment decisions.
Engagement◼ Selected companies with which to hold dialogues, focusing on those with significant impact of nature-related risks andopportunities. In FY2022, dialogues were conducted with 38 companies on the theme of natural capital.
Key Themes in Engagement
Analysis of Risks andOpportunities
Analyze the potential medium- and longterm impacts of risks and opportunities
related to biodiversity and natural capitaland reflect the identified risks andopportunities in business strategies.

Formulation of Policies
and Strategies
Establish an organizational structure fornatural capital and biodiversity, develop
and disclose policies and strategies, andset appropriate KPIs according to thecompany's business and supply chain.

Appropriate Disclosure ofInformation
Appropriate disclosure of identified
risks and opportunities and policies(see "Governance," "Strategy," "Risk &Impact Management," and "Metrics andTargets" recommended by the TNFD).

ESG-themed investment◼ Provide ESG-themed investments and loans that contribute to "improve the sustainability of natural capital" totaling
approximately 40 billion yen (as of March 31, 2023).
◼ Continue to promote these investments and loans while considering upgrading positive impact measurement methods.
Participation in initiatives◼ In October 2022, Dai-ichi Life HD joined the TNFD Forum in support of the philosophyof the TNFD, which aims to establish a framework to systematically identify and disclose nature-related risks.
* L E AP ap pr oach: an ap pro ach t hat enables com panies an d f inancial in stitut io ns to intern ally assess n ature - related r isks an d o ppo rtun ities ( Lo cate ( f ind co ntact wit hn at ur e) , E v aluate (diagn ose dep en dencies an d im pacts) , Assess ( assess r isks an d o pp ortun ities), and P r ep ar e ( p repare to r esp o nd t o r isks an d o pp ortun ities, r epo rt toin v est or s).

Responsible Investment
Report 2023

ESG Investment Report3

ESG integration

Analysis of NatureRelated Risks
As an approach to understanding the impact
on and dependence on nature, we analyzed
nature-related risks and opportunities for ourequity portfolio in accordance with the LEAP
approach proposed by TNFD.
We will continue our efforts to improve thesophistication of our analysis and utilize theresults of our analysis of nature-related risks
and opportunities in our engagement withinvestee companies.

25※A nature-related risk analysis tool developed by the Natural Capital Finance Alliance (NCFA), an international finance industry association for the natural capital area, etc.

Major Initiatives for Respecting Human Rights

Responsible Investment
Report 2023

Incorporating human rights risk into
investment decisions
ESG Investment Report3

ESG integration

Key ESG-themed
initiatives for respecting
human rights
We consider respect for human rights to be
one of the key themes of responsible
investment and believe that the promotionof respect for human rights by investees
will lead to the maintenance andimprovement of corporate value.
In addition to assessing corporate humanrights risks and initiatives and incorporatingthem into the decision-making process forinvestments and loans, we promote corporate
human rights initiatives through engagement
and promote ESG-themed investments andloans that contribute to respect for humanrights.

26◼ Regarding human rights risks, we investigate the status of corporate initiatives, and incorporate them into investment andfinancing decisions while promoting initiatives through engagement (see next section for details).

Engagement
Our Stand-alone Engagement

Collaborative Engagement◼ Selected dialogue partners with a focus oncompanies where human rights risks have asignificant impact. In FY2022, 25 companies wereselected for dialogue on the theme of human rights.

◼ In December 2022, joined “Advance” acollaborative engagement initiative newly
established by PRI based on the theme of "social"issues, with a focus on human rights problems.

◼ In engagement, confirm the status of initiatives
and disclosures on human rights risks, such as
formulation of human rights policies,
implementation of human rights due diligence,and development of remedy mechanisms, andpromote the sophistication of initiatives.

◼ As an effort to reinforce and enhance theeffectiveness of our stand-alone engagement
activities, we will also promote corporate humanrights initiatives through collaborative
engagement through this initiative.

ESG-themed investments◼ Promote theme-based investments and loans that contribute to respect for human rights and gender equality.

Asian Development
Bank“Gender Bonds”

In November 2017, we invested approximately 10 billion yen in"Gender Bonds" issued by the Asian Development Bank. Proceeds
raised through the Gender Bonds will be used to finance projects
that promote women's empowerment in the Asia-Pacific region.

Responsible Investment
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ESG Investment Report3

Analysis of Efforts to Address Human Rights Issues◼ Analyzed the status of human rights initiatives at 60 investees in sectors with high relevance to human rights issues(apparel, food, mining, etc.)◼ While many companies have made progress in addressing human rights issues, including the formulation of humanrights policies, it is recognized that the establishment of more concrete and effective processes and systems to ensure
respect for human rights, particularly the development of redress mechanisms, is an issue for the future.

ESG integration

Analysis of human rights
risks

Percentage of enterprises assessed implementing human rights initiatives＜Policy commitment＞
5%

46%

In analyzing human rights risks, weinvestigate and assess the status of corporate
efforts to address human rights issues,
including the formulation of human rights
policies, implementation of due diligence/remediation mechanisms.
We continuously confirm and promote
corporate efforts through engagement andincorporate the results of engagement into ourinvestment decisions.

＜Remediation＞

13%

49%

Sufficient efforts havebeen implemented

36%

17%

20%

51%
63%

Efforts are being made,but there are challenges

No effort※as of FY2021

Our human rights activities
Equities, Corporate bonds
Selection of key
industries andcompanies

Project Finance27＜Due diligence ＞

Review and evaluationof individualcompanies' humanrights initiatives

Promotion ofreevaluation andinitiatives throughengagement

Reflection in
investment decisions
and corporate
evaluations

Continuous review and improvement

At due diligence at the time of investment and monitoring after investment, we confirm that the project isappropriately addressing ESG issues, including human rights issues.

ESG fund for domestic equities

Responsible Investment
Report 2023

Screening in terms of G
(governance) and climate change(E)

Constituents of ESG
Indexes
ESG Investment Report

3

Positive/Negative Screening①②③

Positive Screening(Equities)
ESG funds for domestic equities are screenedin terms of governance and climate change,
and then the portfolio is constructed by taking
into account the in-house ranks.
From September 2020, ESG index is adopted
as investment targets (benchmarks) for
foreign equity, taking ESG factors into
account in overall foreign equity managed inhouse.

④⑤⑥

FTSE Blossom Japan Index
FTSE Blossom Japan Sector
Relative Index
MSCI Japan ESG SelectLeaders Index
MSCI Japan Empowering
Women Index
Nadeshiko brandHealth and Productivity
Management brand

Investment
universe

Extract high rank companies
based on internal ratings
considering ESG factors

Portfolio

Replace brands and adjust weights
based on internal ratings, etc.

foreign equity investments managed in-house
Constituents of MSCIACWI(MSCI All Country World
Index)ESG index
universe
Determine

28(Make adjustments to neutralize the risk
factors in industries, etc.)

weighting
MSCI ACWIESG Universal Index

Exclude companies such as
those with a record of serious
misconduct or involved in the
manufacture of controversial
weapons
Adjust the weights of the parent index(market capitalization weights) based on
MSCI’s ESG scoresResponsible Investment
Report 2023

Process of negative screening
ESG Investment Report

3

Positive/Negative Screening

Investigating
candidates fornegative screening

Determining fields
and companies
subject to negative
screening

Exclude frominvestment
targets

Regularverification ofholdings

Negative screening
As part of its response to climate change,
Dai-ichi Life has prohibited the financingof new thermal power plant projects thatuse fossil fuels as well as coal mining
projects.

Negative screening targets
Area

Fields subject to screening◼

Dai-ichi Life will continue to review thescope of negative screening based onsocial conditions both in Japan andoverseas as well as other factors.

ClimatechangeOthers29

Projects related to new thermal power plants that use
fossil fuels (including coal, oil, and gas)◼

Coal mining projects◼

Specific types of weapon manufacturing(Cluster munitions, biological weapons, chemical
weapons, antipersonnel landmines, nuclear weapon,
etc.)

Assets under screening◼

Project finance◼

Equity◼

Bond◼

Corporatefinancing◼

Projectfinance◼

Real estateResponsible Investment
Report 2023

Investment Theme

Relevant SDGs targets

Total investment

Climate Change

710 billion

QOL improvement

620 billion

Regional development andrevitalization

210 billion

ESG Investment Report3

ESG-themed investment

Promotion of Investments
to Solve Social Issues
We strive to create a positive impact byinvesting in assets that contribute to solvingsocial issues.
Avoided GHG emissions from investment ofgreen infrastructure projects were 1.23
million tons CO2e, equivalent to 27% ofemissions from our portfolios in FY2022(listed equities, corporate bonds, and realestate).

30

合計：約3,860億円

Sustainability of nature
capital40billion

Respect human rights andpromotion of diversity

10 billion

Total

1.6 trillion*JPY

Positive impact of investments

Approx.

Avoided GHG emissions

People benefited in emerging nations

1.23 million tons CO2e/year

Approx.

Climate change mitigation investments for which GHG
reduction contributions can be estimated, such as
renewable energy power generation projects, or forwhich the impact is disclosed through green bonds. *1.6 million people /year

Projects that disclose the number of beneficiaries ofinvestments and loans focused on improving quality oflife through the provision of microfinance and healthservices in emerging countries.

*The avoided GHG by investment of renewable power generation businesses is calculated using the PCAF concept. The PCAF is an international initiative
developing methods to measure and calculate GHG emissions in investment and financing portfolios.

Responsible Investment
Report 2023

Transition finance:
major example

Transition loan to Tohoku Electric Power
Supporting the transition to a decarbonized society by supplying funds for initiatives
aimed at reducing emissions
Dai-ichi Life has concluded a transition loan agreement* with Tohoku Electric Power (the borrower) to provide
funding support for Tohoku Electric Power's initiatives to reduce greenhouse gas emissions (Tohoku Electric PowerGroup Carbon Neutral Challenge 2050). The funds raised as a result of this loan will be used only for the following
Tohoku Electric Power initiatives to reduce greenhouse gas emissions: the costs of developing a combined cycle power
plant that combines gas and steam turbines that utilize liquefied natural gas (LNG) as fuel, which has a low
environmental impact, and the costs of developing both Tohoku-Tokyo interconnection lines and infrastructure in thenorthern Tohoku area. The utilization of the above highly efficient power sources is

expected to encourage thesuspension and abolishment of the use of conventional coal and oil-fired power plants while also reducing GHG
emissions and thus the environmental impact.

Project overview

Borrower Tohoku Electric Power Loan amount ¥5 billion

Purpose of funds▲ Joetsu Thermal Power Station in Joetsu, Niigata (photo courtesyof Tohoku Electric Power)

31

Period Seven years

・Funds for developing Joetsu Thermal Power Station
・Costs of developing Tohoku-Tokyo interconnection lines
・Costs of developing systems related to a bidding process for connecting to the grid in the northern
Tohoku area

* The Tohoku Electric Power Green Finance Framework formulated by Tohoku Electric Power has undergone a third-party
assessment by DNV Business Assurance Japan K.K. regarding its alignment with various criteria related to green transition
finance, etc.

Responsible Investment
Report 2023

Development of a Well-being Community that Enhances
the Quality of Life of Local Residents
A town of well-being where multi-generational residents can continue to live healthy lives withpeace of mind and rich interaction, “SETAGAYA Qs-GARDEN”

Example of ESG-themed
investment

SETAGAYA Qs-GARDEN (Setagaya-ku, Tokyo), which has been developed based on the concept of improving
the quality of life of local residents through health promotion, support for the elderly, community revitalization,
childcare and education, sports promotion, security and disaster prevention, and environmental consideration,celebrated its town opening in March 2023.
On a site of approximately 9 hectares with a rich green environment, which has become a rarity in Tokyo, we aim tocontinue to provide multi-generational living and rich interaction by arranging condominiums for families, a clinic
mall, student housing, housing for the elderly with services, and local community facilities. We will continue to
implement town management activities to enhance the well-being of local residents.
Examples of Initiatives to Build a Well -being Community
Maintenance of running courses
Developed a forest running course supervised by the Dai-ichi Life Group Women's
Track & Field Team that can be used by local residents.

Installation of small wind turbine generators
Installed small wind turbine generator that can be used as an emergency powersource in the event of a disaster and is easy to install in urban areas.

▲

33<Entire map of SETAGAYA Qs-GARDEN>

Local clinic mallConnect generations through medical care and health, establishing medical malls as
community hubs, and holding events and other activities targeting lifestyle-relateddiseases and prevention.

Responsible Investment
Report 2023

Investing in ESG-conscious Real Estate Funds
Pay nursing homes as assets, contributing to well-being

Example of ESG-themed
investment

In December 2022, Sumitomo Forestry invested in an ESG-conscious real estate fund. The assets targeted by thefund are four pay nursing homes with assisted-living operated by sumirin fillcare co., ltd., a wholly owned subsidiaryof Sumitomo Forestry Co., Ltd. It incorporates wooden facilities and spaces filled with wooden textures and is
expected to contribute to the well-being of residents and employees and reduce environmental impact throughoperations utilizing digital transformation (DX) services.
Summary of Transaction
Investment Target
Asset Manager

4 pay nursing homes

Assets under management

Approximately 4 billion yen

SFC Asset Management Co., Ltd, Samurai Capital Inc.

Human- and eco-friendly homes that leverages the characteristics of wood
Sumitomo Forestry's Tsukuba Research Institute researches "the effects of wood's characteristics on the mind andbody," and the results of this research are being utilized at facilities operated by sumirin fillcare. Wood is used in theinterior to provide a space that reduces fatigue and improves the quality of sleep. Flooring materials that are less likely tocause injury in the event of a fall have been introduced at each facility. It contributes to the realization of a decarbonizedsociety using wood, which fixes carbon in the long term.

▲ Interior of a facility operated by sumirin fillcare

33

Resident- and employee-friendly management system
Sumirin fillcare provides "Forest Life", a unique health management service, to support residents' well-being. We propose theintroduction of rehabilitation and recreational activities in daily life according to each resident's requirements and physicalcondition. Various ICT devices are used to collect sleep and other data to support the understanding of health conditions.
DX of services streamlines operations, reduces the workload of employees, and leads to the well-being of employees
as well as residents.

Responsible Investment
Report 2023

Impact Investments*as of Mar 2023
Investment
Category

3

Definition

AssetsInvestment
amountinitiatives

Approx. JPY 58
billionNew investment
promotion andengagement(KPI follow-up)

ESG Investment Report

ESG-themed investment

impactinvestments

Investments intended to foster
innovation that helps change the social
landscape and solve social issues *Seeevaluation criteria below

Listed equities, unlisted
equities, funds, etc.

Broadly defined
impactinvestments

Investments identify the environmental,social, and economic impact of theissuing company and business receiving
the proceeds as well as manage
evaluation analyses and measurements
to determine the level of impact(Investments always identify andmeasure the impact unique to theinvestment product)

Sustainability-linked
bonds/loans, positive impact
financing, positive impact realestateInvestments in assets that have themes
tied to solutions for addressing social
issuesGreen /social bonds/loans,sustainability bonds/loans,renewable energy, and otherproject

Investments to Create a
Positive Impact on Society
We began impact investments centered upon unlisted
equities in FY2017 (listed equities added fromFY2020). We select these according to the vision ofsolutions and innovations to overcome social issues
and regularly monitor the social impact afterinvesting.

In an effort to further expand the positive impact of
the investment portfolio, from FY2022, investmentsthat require the identification and measurement of
impact due to the characteristics of the investment
product will also be included in "impact investments"
and impacts will be monitored.
We also will measure the social impact of ESGthemed investments and encourage investees todisclose their impact through engagement withinvestee organizations.

ESG-themed
investment

Approx. JPY 59
billionTotal impact
investments:
Approx. JPY 117
billionApprox. JPY 1.6
trillion

New investment
promotion andengagement(KPI follow-up)

New investment
promotion andengagement(Encourage impact
disclosure)Criteria for impact investments (must have all of the following)
•
•
•

34
•

The project has set indicators to monitor the social impact
The project has “innovativeness,” or “uniqueness and a barrier to entry” as well as the potential to create thesocial impact that Dai-ichi Life expects
Management at the company under evaluation for an investment has a strong will to generate the social
impact that Dai-ichi Life expects
The impact business is the primary business (or will become the primary business in the future)Major Social Impact

Responsible Investment
Report 2023

Improve patient quality of life

Investment in KAKEHASHI Inc.
Example of impact
investment

Contributing to Medical DX and to Establishing a Sustainable Medical
SystemContinuously providing high-addedvalue drug administration guidance
and improving patient quality of life
by developing and providing systems
for pharmacies

We invested 500 million yen in KAKEHASHI Inc., a Japanese startup that develops and provides medical
services. This impact investment is a part of the Company’s ESG investments. The Company expects highreturns from its investment in KAKEHASHI. Through this investment, the Company will also provide
financial support for and continually monitor KAKEHASHI’s initiatives, which are hoped to have a positive
impact on society by improving patient quality of life.

◼ KAKEHASHI is a Japanese startup that develops and provides services that include “Musubi”, acloud-based electronic drug history and drug administration guidance system for dispensing
pharmacies.

◼ Musubi provides support that facilitates the creation of drug histories that record drug
administration guidance, dispensing details, and other information according to the healthconditions and lifestyle habits of patients by using tablet screens, and the system also makes it
possible to centrally manage drug-taking information in coordination with other stores via thecloud.

▲ Cloud-based electronic drug history and drug
administration guidance system, Musubi

35◼ By utilizing this system to set up an environment that enables pharmacists to continuously provide
high-added-value drug administration guidance, KAKEHASHI is expected to contribute toimproved patient quality of life—including their adherence*—thereby helping to build a sustainable
medical system for the future.
* Adherence refers to whether patients understand their treatment and actively follow the medical directions they are given.

*Major investment projects after September 2022

Responsible Investment
Report 2023

Impact Investments
Project Summary

Social Impact

Investment

Period• This Japanese startup offers electric power services to
off-grid communities in Africa through solar power
generation.

Provision of electric power
services via solar power
to off-grid communities in Africa
to help improve living standards
and financial independence

JPY 300
million2022/6

Installation of distributed small andmedium-size solar power
generation facilities
for an early transition to a
decarbonized society

JPY 300
million2022/8Resource recycling using chemical
recycling technology
to realize a sustainable society

JPY500
million2022/8Reduce GHG emissions bypromoting renewable energy andenergy conservation

JPY 1.5billion2022/9WASSHA

Clean Energy Connect• This Japanese startup offers low-voltage, distributed offsite corporate power purchase agreements (PPAs) tocompanies

JEPLAN• This Japanese startup is striving to expand and standardize
resource recycling using “BRING TechnologyTM”, aproprietary chemical recycling technology, to achieve
horizontal bottle-to-bottle recycling of PET bottles.

EEI Fund• A Japanese venture fund specializing in theenvironmental and energy fields. Invests in startups withbusiness models and technologies that contribute to therealization of a sustainable society with a focus on
decarbonization.

36

Responsible Investment
Report 2023

Report on Stewardship
Activities

Responsible Investment
Report 2023

Our Basic Approach for Stewardship Activities

Report on stewardship activities

4

Basic approach and processes

Increase corporate value in the midto long-term

Our Basic Approach for
Stewardship Activities

Responding to E/S
issuesGovernanceWe engage in stewardship activities the “Daiichi Life way,” reflecting our group missionof “By your side, for life.” We undertake
activities with a close understanding of theissues facing investee companies which differ
by growth stage and help increase corporate
value in the mid- to long-term.
We are actively pursuing more sophisticatedefforts, based on both Japan’s Stewardship
Code and Corporate Governance Code.

Growth strategies

Mid- to long-term stewardship activities
according to the growth stage of companies

Corporate
Governance Code

Stewardship CodeMoresophisticatedgovernancesystem38

Moresophisticatedstewardship
activities

Our Stewardship Activity Process

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Report 2023

Report on stewardship activities

4

Basic approach and processes

Reflect oninternal ratings

Improveinvestment
returns

Investment
decision*Responsible investment committee

Our Stewardship Activity
Process
We conduct stewardship activities focused on
engagements, with a view to promoting
increases in the corporate value of investee
companies and improving our mid- to longterm investment returns.

Selection ofcompanies to beengagedVoting
Review the agenda
items based on theengagements

Follow up on
progressof issues

based on importanceand engagement theme

Increase corporate
value of investees
Analyze
companies

Monitor progress of issues
and provide information tocompanies

Analyze financial/nonfinancial information
based on disclosed
information

Conduct
engagements
39

Exchange opinionswith companies on theissues we identified

Responsible Investment
Report 2023

FY2014

4

Stricture

Report on stewardship activities

Our history for stewardship activities
and review

FY2016110

233

FY2017FY2018FY2019FY2020

Responsible
Investment
Dept.

Analysts
Assignment
conducts of Dedicatedengagements person

Announced commitment to Stewardship Code

40

Engag
ement

Theme

We continue to implement stewardship
activities with an emphasis on engagement
through diversification of engagement
methods and themes, and enhancement oftransparency by improving information
disclosure regarding the exercise of voting
rights. Themes for engagement are ESG andmanagement/financial
strategies,
with"climate change" as a priority theme fromFY 2019 onward, as well as "human rights
and human capital" from FY 2021 and"biodiversity" from FY 2022, to promote
corporate responses.

Approach

Our history on
Stewardship Activities

FY2015277

271

FY2021

FY2022

202

188

ESG
Analysts
251

239

248

Commence bonds
engagements

Collaborative
engagements(LIAJ)

Sending letter

Sending letter /dialogs(Institutional Investors Collective
Engagement Forum )Sending letter /dialogs

Full-scalelaunchCorporate governance

Climate change

Environmental/social issues

Top 50 emitting companies

ESG
Plastic waste

Human Rights/Capitalbiodiversity

Management/ Financial strategies

Disclose voting tally table (for each agenda item type)
Disclose votes in favor/against each agenda item (quarterly)
Disclosure of reasons for approval ordisapproval

VotingDisclose summary voting policy

Disclose details of voting policy※The number of companies is counted with July-June as one fiscal year.

Responsible Investment
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Tracking 4-step milestones
2

Report on stewardship activities

4

1

Our history for stewardship activities
and review

Raise issue

Following up Progress ofEngagement Issues
We regularly follow up on the progress of theissues based on engagements and help solve
the issues of investee companies by providing
information in response to the issues.

Dai-ichi Life raises a
matter it considers to be
an issue with an investee
company

4
3

Recognize
issue
The investee company
recognizes that it must
address this issue

Addressissue
The investee company
begins addressing theissue

Dai-ichi Life confirmsthat the issue has beensolvedExamples of issues of each theme
Environmental/social issues⚫ Addressing climatechange issues⚫ Human capitalutilization/Human rights
due diligence⚫ Natural capital andbiodiversity initiatives

Governance⚫ Application of
independent outside
directors⚫ Composition of board of
directors and its
effectiveness⚫ Nomination/remuneration

Management/financial strategies⚫ Identifying materiality and reflecting it in management
strategy⚫ Formulating and disclosing mid-term management plan
and KPI considering validity⚫ Business portfolio⚫ Formulating and disclosing capital policies（investment,
shareholder return and retained earnings ）⚫ Improving total return ratio

41

Solve issue⚫ Cross-Shareholdings⚫ Capital efficiency

Responsible Investment
Report 2023

Engagement
FY2022

Total brand holdings: Approx. 1,500

Holdings amount/
top shareholders(including general/special accounts)
Focal themes

Report on stewardship activities

4<Climate change, human rights, natural capital, etc.>
50 companies in our portfolio with the highest greenhouse gas emissions
Companies where human rights and natural capital were critical management issues

Our history for stewardship activities
and review

Status of Engagementin FY2022
In addition to the top 50 GHG emitters in our
portfolio, we selected companies forengagement from the perspective of key
dialogue themes, management strategy,
governance, etc., while taking into accountthe importance of the amount of money held,
shareholder ranking, etc. We conductedengagement with a total of 188 companies.
We set new issues for companies to beengaged, such as setting targets and roadmaps
for GHG emission reductions, improving
profitability and formulating management
strategies in light of changes in the businessenvironment, and improving governancesystems after the occurrence of scandals.

42<Management strategy>
Growth strategies/business
model<Governance, etc.>
Governance and other issues

Dialogue with 188 companies
Covers about 60% of the market capitalization of the portfolios↓
Covers about 80% in the medium term (about 3 years)

New issues set

FY2022

FY2021governanceManagement/
financialstrategies

Environmen
tal/social
issuesManagement/
financialstrategies

gorvanance

Environmental/social issues

Responsible Investment
Report 2023

Medium-term engagement outcomes✓ Investee companies have resolved 90% of the environmental, social and governance issues of those identified before
FY2019 as well as 70% of the management and financial strategies.

Report on stewardship activities

4

Our history for stewardship activities
and review

Medium-term
Engagement Outcomes
Progress has been made to solve the issues
raised with companies over time.

✓ Investee companies have resolved 80% of the environmental, social issues, 70% of governance issues of those identified
after FY2020 as well as 50% of the management and financial strategies.

✓ We will focus on issues prioritized by the companies and investors and continually support the initiatives.

＜ Progress as of June 2023 (by the time the issues were set) ＞
Environmental/social issues

GovernanceManagement/financial strategies

100%

100%

100%

80%

80%

80%

80%

60%

40%

④

90%

③
②
①

20%
0%

2019年度以前
Bef. FY2019

2020年度以降
Aft. FY2020

70%

60%

40%

90%

60%

70%

40%

20%

20%

0%

0%

Bef. FY2019
2019年度以前

50%

Aft. FY2020
2020年度以降

Bef.
FY20192019年度以前

43① Raise issue: Dai-ichi Life raises a matter it considers to be an issue with a company② Recognize issue: The company recognizes that it must address the issue③ Address issue: The company begins addressing the issue④ Solve issue: Dai-ichi Life confirms that the issue has been resolved

Progress ofengagement

Recognize
issue:
The companymilestones
recognizes that it must address the issue
Tracking
engagement

Aft.
FY20202020年度以降

Climate Change
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Report 2023

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4

Examples of engagements

Key points of engagement
for each agenda

Engagement is conducted upon setting an agenda
and points to be confirmed or requested in advance,
depending on the situation of the investee.

44◆ Set targets and formulate a specific roadmap aimed at achieving carbon neutrality by 2050
◆ Set interim targets for GHG emission reductions (2030 targets, etc.) and formulate specific policies for the
short- to medium-term◆ Endorse the TCFD recommendations, establish a governance structure based on them, and status of conducting anddisclosing scenario analysis information, including the associated financial effects◆ Status of initiatives toward acquiring SBT (Science Based Targets) certification

ESG (Other than Climate Change)◆ Initiatives to improve the effectiveness of the Board of Directors (evaluation of effectiveness, composition of theBoard of Directors including securement of diversity, compensation, use of outside directors and voluntarycommittees, etc.)◆ Build a more effective governance system at listed subsidiaries, such as enhancing the number of independent
outside directors◆ Status of human capital initiatives from the perspective of increasing corporate value◆ Status of implementation of human rights due diligence, including supply chain◆ Recognition of the impact of the business on natural capital and biodiversity, and policy on how to respond◆ Integrated disclosure of financial and non-financial information (issuance of integrated reports, etc.)◆ Business model reform based on changes in the external environment, supply chain restructuring, DX support, etc.

Management and Financial Strategy◆ Consistency of the business model with the company's significance of existence (purpose) and management
philosophy◆ Issues surrounding sustainability, which is recognized as a significant management issue, and initiatives from theperspective of improving corporate value over the medium- to long-term◆ Identifying materiality and reflecting it in management strategies (risks and growth opportunities) and setting
KPIs for ESG issues◆ Management strategies for sustainable growth (long-term vision, medium-term management plan, etc.) andtheir progress in detail◆ KPIs on areas such as profitability and capital efficiency based on cost of capital and their progress◆ Strategic investment for growth (M&A, capital investment, R&D investment, investment in human capital,
system investment, etc.)◆ Approach to business portfolio

Responsible Investment
Report 2023

Examples of engagement
Land transportation

CompanyA

I s s ueStrengthening initiatives to address climatechange issues

Goal

Set reduction targets for affiliated companies
with high GHG emissions and strengthen
reduction initiatives

State of Progress2

1

Rai s eis s u e

Recog ni ze
is s u eAddres s
is s u e

Set reduction targets for affiliated companies
with high GHG emissions and strengthen
reduction initiatives

Goal

State of Progress2
1

45

Confirmed company
initiative improvements

Shared the importance of
responding to climate change
issues and exchanged opinions
on targets, specific initiatives,
etc.

Endorsed the TCFD, set GHG
reduction targets, expandedbusinesses covered by thetargets and recently disclosed a
specificroadmap,while
initiatives to obtain SBT
certification have also been
confirmed.

S ol veis s u eStrengthening initiatives to address climatechange issues

I s s ueRai s eis s u e

43

Recog ni ze
is s u eAddres s
is s u e

S ol veis s u e

Response of theinvestee company

Number of dialogues:
4 Since 2018

ChemicalCompanyＢ

43

Dialogue overview

Dialogue overview
Three engagements including
climate change agenda since
FY2020. Exchange opinions
on the appropriateness of
GHG reduction targets,detailed reduction initiatives,and GHG reduction
initiatives of affiliatedcompanies with large GHG
emissions.

Exercising voting
rightsNo voting on theinvestee company's
climate change response
as a decision criteria.

Future policy

Implement ongoingengagement◼ Follow up on the progressof the disclosed roadmap.
◼ Follow up on the situationof initiatives aimed at
SBT certification.

Response of theinvestee company

Exercising voting
rightsProgress has been made ininitiatives to reduce GHG
emissions, including declarationof carbon neutrality and raising
GHG emission reduction
targets, and most recently,
affiliated companies with highGHG emissions have disclosed
reduction targets and roadmaps
for reduction.

No voting on theinvestee company’s
climate change response
as a decision criteria.

Future policy◼ Follow-up on thecompany's GHG
reduction initiatives.
◼ Follow-up on GHG
emission reduction
initiatives of affiliatedcompanies, including
management systems.

Responsible Investment
Report 2023

Examples of engagement
Machinery company

CompanyC

I s s ueStrengthening initiatives to respondto climate change issues

Goal

Formulate GHG reduction targets
and a roadmap to carbon neutrality

State of Progress
2

33

1

Rai s eis s u e

Recog ni ze
is s u eAddres s
is s u e

Number of dialogues: 4
Since 2018

Confirmed a certain
level of company
initiative improvements

Shared the importance of
responding to climate change
issues and exchanged opinions
on disclosure and initiatives inline with the TCFD framework.

S ol veis s u e

I s s ueStrengthen governanceDialogue overview

Goal

Secure board diversity

While performance is strong,exchanged views on thecomposition of the Board of
Directors and governancestructure from the perspective ofsustainable growth, as thecomposition of the Board of
Directors is biased. Fourdialogues conducted since
FY2018.

State of Progress2
1

Rai s eis s u e

46

Response of theinvestee company

Chemical company

CompanyD

4

Dialogue overview

4
3

Recog ni ze
is s u eAddres s
is s u e

S ol veis s u e

Exercising voting
rightsNo voting on the investee
company's climatechange response as adecision criteria.

Significantly reduced the numberof directors, set the number of
independent outside directors to
at least 1/3, and appointed afemale auditor. Most recently,
increased the number of
independent outside directors tomajority and appointed the firstfemale director.

Promote further
initiative improvements◼ Continue to request roadmap
formulation and disclosure.

◼ Follow up on GHG reduction
initiatives, includingtransforming the medium tolong-term business portfolio.

Endorsed the TCFD but did not
set specific reduction targets ordisclose a roadmap for a while
after that. Recently disclosed
GHG reduction targets.
.

Response of theinvestee company

Future policy

Exercising voting
rights
Opposed the appointment
of independent outside
directors with low
independence, although
the criteria for the numberof independent outside
directors are not violated.

Future policy◼ Follow up on changes in
effectiveness due tochanges in board
composition.
◼ Several outside directors
with long tenure. Follow up
on the concept of a
succession plan for outside
directors.

Responsible Investment
Report 2023

Examples of engagement
Company

Transportation equipment

E

Disclosure of initiatives to improve
profitability and stock priceI s s ue

Enhance disclosure of medium-term
management plan and other information

Goal

State of Progress

2

1

Recog ni ze
is s u eRai s eis s u eCompanyF

Addres s
is s u e

S ol veis s u e

WholesaleI s s ue

Improvement in profitability

Goal

Improve capital efficiency throughimplementation of measures to increase
gross margin and review of businessportfolio, etc.

State of Progress2

Rai s eis s u e

4

3

1

47

4
3

Recog ni ze
is s u eAddres s
is s u e

S ol veis s u e

Dialogue overview

Response of theinvestee company

Exercising voting
rightsExchanged opinions on
initiatives to improve
profitability and stock price,
disclosure details, as well as
enhancement of thegovernance system. Fourdialogues conducted since
FY2018.

I n addition to the appointmentof a person with management
experience as an outside
director, the new medium-term
management plan sets capitalefficiency targets, reduces
policy shareholdings, anddiscloses enhanced shareholder
returns.

No conflict with voting
criteria underperformance criteria orshareholder return
criteria.

Dialogue overview

Response of theinvestee company

Exercising voting
rightsAs the profit margin has been
declining since before COVID19, opinions were exchanged
on measures to improve thegross margin and the necessityof loss-generating businesses.
Short-term measures andmedium- to long-term measures
were also confirmed during
COVID-19. Four dialogues
conducted since FY2018.

The breakeven point was lowered
when business performance
deteriorated significantly due to
COVID-19. In addition to thesubsequent increase in revenue,
the company successfully passedon higher raw material prices,
resulting in a record level ofoperating income. Divestiture ofloss-generating businesses was
also announced.

Although the company violated
the performance standard(ROE), it was judged that there
was a high probability ofachieving the medium-term
management plan, which isequivalent to ROE of 5% ormore within two fiscal years.
Voted in favor of the election of
the director, applying theexception clause.

Future policy◼ Follow-up on medium-term
management plan.
◼ Follow-up on capital policy,
including initiatives to further
reduce policy shareholdings
and use of proceeds fromsales of shares.

Future policy◼ Follow up on
performance recovery
and current measures,from the viewpoint ofsustainability, etc.

Responsible Investment
Report 2023

Report on stewardship activities

4

Examples of engagements

Participation in Collaborative
Engagement Opportunities
through the Life Insurance
Association of JapanAs an effort to strengthen our engagement
activities and enhance the effectiveness, we
continuously participate in collaborative
engagement opportunities conducted by theWorking Group for Stewardship Activities of
the Life Insurance Association of Japan (LIAJ).

Summary of Collaborative Engagement Initiatives through Life
Insurance Associations in FY2022✓ A total of 151 companies (156 companies in total) were engaged under the three themes of "enhancing shareholder
returns," "improving disclosure of ESG information," and "improving disclosure of climate change information”.
✓ Under the theme of " improving disclosure of climate change information “, we encouraged the top 50 GHG emitters to(1) quantitative and qualitative analysis of climate risks & opportunities, (2) disclose a roadmap for reducing GHG
emissions to net zero by 2050, and (3) for companies that have already disclosed such information, periodically review
and upgrade their analysis.
✓ We are also encouraging companies that have already disclosed their GHG emission reductions to review and upgrade
their analyses on a regular basis, thereby strengthening their efforts.

FY2022 Engagement Themes

FY2021 Results<Progress of efforts at companies after engagement>◼ Enhancing shareholder returns
80% improved

LIAJ Working Group for Stewardship Activities(11 life insurance companies including Dai-ichi Life)

Dividend payout
ratio over 30％

21％

Letter sent under joint signatures of
11 life insurance companies to explain the
purpose through engagement and other activities
Intensify
effort48

Enhancingshareholder returns

Enhancing
disclosure of ESG
information

Enhancing
disclosure of climatechange information

57 companies

47 companies

52 companies（increased dividend payout ratio）
59％

delisting2%（No
improvement）

19％

Dividend ratio below 30%◼ Enhancing disclosure of climate change①disclosure of risk & opportunities

Disclosed in allcompanies
Disclosed（only qualitative）…
58％

Disclosed(quantitative & qualitative)
42％②roadmap to net-zero

Confirmation of positive attitude
toward improvement

Disclosed
85%

No disclose
15％…

Source: Prepared by Dai-ichi Life based on LIAJ Life Insurance Companies’ Efforts to Revitalize the Stock Market and Realize a Sustainable Society throughAsset Management

Responsible Investment
Report 2023

Outline of Initiatives
Report on stewardship activities

4

Examples of engagements

Collaborative engagement
through Institutional
Investors Collective
Engagement Forum
We have been participating in the Institutional
Investors Collective Engagement Forum since
March 2020, and have been conducting dialogue
with companies in collaboration with otherinstitutional investors.

✓ Established to support institutional investors conduct “collective engagements.” The Forum organizes Institutional Investors
Collective Engagement Program, which we have been participating in since March 2020.
✓ The program’s general flow includes setting common agendas for institutional investors, sending letters of common views, andholding individual meetings.
✓ From February to March 2022, a letter was sent to 53 companies whose takeover defense measures expire in
2022, stating concerns about the continuation of takeover defense measures and requesting disclosure of reasons
based on the concerns if the measures are continued. Eight of the companies did not continue their takeover
defense measures.
✓ From November to December 2022, a letter was sent to 1,836 companies listed on TSE Prime Market requesting
disclosure of non-financial and sustainability information such as human capital and intellectual property that could
affect a company's future finances, organized as a medium- to long-term corporate value enhancement story.

Agenda Setting and Common View
Agreement

Sending Letter of Common View
Meeting

Agendas◆ Identification of materiality and disclosure of non-financial
information◆ Responding to proposals with many “against” votes at generalshareholders meetings◆ Explanation of the necessity of takeover defense measures◆ Reduction of cross-shareholdings◆ Enhancing governance for parent-subsidiary listings◆ Scandal handlingCollective engagement case example (conducted April 2023)

49

Target company: Resonac Holdings Corporation
Theme: Concepts on human capital management and human resource materiality,
non-financial goals
The target company requested an exchange of opinions on the above topics.
The participants exchanged opinions on the relationship between business strategy
and human resource strategy, as well as the impact of corporate integration onorganizational culture and its reflection on human resource strategy.

Responsible Investment
Report 2023

AssetsEquities

Typical Approach Methods•

Report on stewardship activities

4

Examples of engagements

Engagement approach foreach asset•

Corporatebonds/loans

The basic policy for responsible investment
states that we aim to conduct stewardship
activities based on engagement in all assets,taking into consideration the characteristics ofeach asset and region, and the degree of our
influence as an investor.
Based on this policy, in addition to the repeatedand continuous engagement activities fordomestic listed equities by the department
dedicated to engagement, we have been
conducting engagement activities at theinvestment execution departments in charge ofeach asset.

50

•

•

•

(For listed companies in Japan) Conduct recurring and ongoing engagement
activities to help maintain and enhance corporate value by resolving key
issues(Including unlisted companies) Exchange opinions on the establishment of
impact KPIs and specific strategies for creating positive impact when considering
impact investments and continue to follow up on the status of KPI achievement
after investment and promote additional initiatives, as necessary
Promote corporate initiatives through collaborative engagement such as
Institutional Investors Collective Engagement Forum
Confirm the disclosure status of the impact of SDG bonds held by the company
and promote the disclosure of SDG bonds to those companies that have notsufficiently disclosed their impact
At the time of investment in transition finance, confirm the appropriateness of thecompany's transition strategy toward Net Zero and the use of funds, and exchange
views on the use of funds
Promote corporate initiatives through collaborative engagement such as CA100+

Funds

•

Interviews on the existence or non-existence of a responsible investment policy
and the details of efforts of funds at the time of investment decision and during
periodic monitoring after investment and promote additional efforts, as necessary

Sovereignbonds•

Expressing opinions on policy proposals as a member of committees and working
groups set up by relevant ministries and agencies
Providing input as an investor through the advocacy activities of the Life Insurance
Association of Japan (LIAJ)Involved in the policy advocacy process throughglobal initiatives such as GFANZ•

Responsible Investment
Report 2023

Agenda item
Report on stewardship activities

4

Voting policy and voting records

Voting Policy(Main Points①)
Our voting policy is designed to increase thecorporate value of portfolio companies andpromote sustainable growth.
We review the voting policy as needed basedon various factors, including the social andeconomic situations surrounding the companies.

Appointing
directors,
auditors, etc.

CandidateMarketRepresentative director All markets

Representative director

Planned Revision

Since April 2023

After April 2024

When ongoing dialogues do not show
improvements in ESG issues that use
No change
problems and priority themes of portfolio
companies

TSE Prime

Less than 1/3 independent outside
directors or Less than 2

TSE Standard

Less than 2 independent outside directors No change

TSE Growth

Absence of independent outside director No change

No change

Representative directorof listed subsidiary thatAll markets
has a controllinginterest

Less than 1/3 independent outside
directors or Less than 2

No change

Director

Deficit for three consecutive fiscal
years/under 5% ROE for five straightfiscal years（expand applicable people
to reappointed directors）

No change

・Originally from major shareholders
with 10% or more holding ratio orLong tenure (total of 12 years or more)

No change

Originally from major shareholders
with 10% or more holding ratio

No change

All markets

TSE Prime
Independent outside
officer(director/auditor, etc.) Other than TSE
Prime

51

Current

Outside officer
All markets(director, auditor, etc.)

Under 75% attendance rate at board of
No change
directors and board of auditors' meetings

Responsible Investment
Report 2023

Agenda item

Candidate4

Voting Policy(Main Points②)

Officer compensation,
retirement allowance,stock-based
compensation, andissuing and granting
stock options

We review the voting policy as needed basedon various factors, including the social andeconomic situations surrounding the companies.

After April 2024
No change

No change

Increase in officer compensation and payment ofofficer bonuses in poorly performing companies

No change

Provision of retirement allowances to auditors, etc. No change(One of the following applies)
Under 20% total return ratio for three cumulative
Appropriation of surplus
fiscal years and most recent fiscal year
(representative director is
No change
reappointed as director if All markets Under 30% total return ratio for three
cumulative fiscal years and most recent fiscal
there is no applicable
year and Net cash is more than 50% of net assets
agenda item)
for the last two consecutive terms

Introduction and updateof takeover defense
measures52

Since April 2023

Granting of stock-based compensation and stock
options that may cause
All markets
over 10% dilution

TSE Prime
Our voting policy is designed to increase thecorporate value of portfolio companies andpromote sustainable growth.

Planned Revision

Granting stock-based compensation and stock
options to auditors, etc.

Report on stewardship activities

Voting policy and voting records

Current(One of the following applies)
All markets Under 5% ROE for three consecutive fiscal years
Less than 1/3 or 2 independent outside directors(One of the following
applies)
Under 8% ROE for threeconsecutive fiscal years; Less
than a majority of
independent outside directors※The items in green are revisions from the current fiscal year. See materials on our website for more information on our voting policy. voting policy

Voting Record (July 2022 – June 2023)

Responsible Investment
Report 2023

Agenda Items Proposed by Companies
Report on stewardship activities

4

Agenda Items Proposed by Shareholders

3.3％ voted against（＋1.3％）

0.6％ voted for （＋0.6％）

Voting policy and voting records

Agenda
議案数
15,309Voting Records
The ratio of objections to company-proposed
proposals remained relatively low due to theemphasis on medium- to long-term engagementwith investee companies.
The ratio of opposition to company-proposed
proposals as a whole also increased compared tothe previous year due to a rise in the ratio of
opposition to proposals for the election or
dismissal of directors due to violation of theperformance criteria.
With regard to shareholder-proposed proposals,
approval or disapproval is determined from theperspective of whether the proposal will contributeto the enhancement of corporate value over the
medium to long term, and as a result, there were
two affirmative vote.

53(Year on year)

Agenda
議案数
360■ Proposal on Corporate Organization【 Selection and dismissal of
directors 】
3.9% voted against(+1.8%)

Agenda
議案数
10,789【 Selection and dismissalof auditors】
2.2% voted against(-1.0%)【 Selection and Dismissalof Accounting Auditor 】
0.0％ voted against(±0.0%)

Agenda
議案数
2,528

Agenda
議案数30

Voting Record (July 2022 – June 2023)

Responsible Investment
Report 2023

■ Agenda items related to Articles
of Incorporation■ Agenda items related to officer compensation

Report on stewardship activities

4

Voting policy and voting records

Voting Records
With regard to proposals on executive
compensation, we are opposed to the granting ofstock options and retirement benefits to corporate
auditors, etc., because these proposals may weaken
the check-and-balance function to the Board of
Directors required of corporate auditors
With regard to takeover defenses, the current
criteria call for approval if the company has
achieved a certain level of governance structure
and capital efficiency, but after April 2024, ahigher level of governance structure and higher
capital efficiency will be required.
With regard to specially targeted anti-takeovermeasures, we judge them from the perspective ofwhether they lead to an increase in corporate value,
etc.

54

(Year on year)【officer compensation】
2.0％ voted against(＋0.6%)【Retirement allowances for retired
officers】
8.8％ voted against(＋0.1%)

Agenda
議案数
455

Agenda
議案数
570.0％ voted against (±0.0%)

Agenda
議案数394■ Agenda items related to capital policies (expect those for Articles of Incorporation)【Surplus
appropriation】
0.8％ voted against(±0.0%）

Agenda
議案数
950【Introduction, update, andabolishment of takeover defense
measure】
0.0％ voted against
25.0％ voted against(±0.0%)(△2.5%)【Organizational
restructuring】

Agenda
議案数
18

Agenda
議案数
56【Agenda items related to othercapital policies】
0.0％ voted against(±0.0%)

Agenda
議案数
31

Compliance with
Stewardship Code

Our Compliance with Japan’s Stewardship Code (Self-evaluation)《Principal１》
Institutional investors should have a clear policy on how they fulfill theirstewardship responsibilities, and publicly disclose it《Principal２》
Institutional investors should have a clear policy on how they fulfill theirstewardship responsibilities, and publicly disclose it

Policy◼ The Responsible Investment Department, which is dedicated to stewardship
activities, makes decisions regarding engagement activities and exercise of
voting rights from the viewpoint of maintaining or enhancing an investee
company’s corporate value and improving its governance.
◼ The Responsible Investment Committee monitors the stewardship activities fromthe viewpoint of conflicts of interest.

Achievements

In September 2022, we formulated and published our Policy on Transition
Finance, which states our approach to engagement in transition finance.
In addition to the traditional repetitive and continuous engagement fordomestic listed equities, we are also conducting engagement for each asset
by taking an approach appropriate to the characteristics.

Achievements

The Responsible Investment Committee was established in April 2017, and since April
2018, the committee has consisted of three external members and two internal members(one of whom is the executive officer in charge of the Compliance Management Department,
which is in charge of conflict of interest management), making it a majority external
committee. The Responsible Investment Committee deliberates and decides on particularly
important voting rights exercises, such as for companies with large holdings or companies
that have attracted significant social attention, and all important voting rights exercises arereported to the Responsible Investment Committee.

Selfevaluation

We evaluate that the company is appropriately implementing measures to fulfill its
stewardship responsibilities, such as formulating and announcing policies based on theexternal environment and other factors. the company has made progress in promoting theenhancement of the corporate value of investees by expanding assets of the engagements.
we believe that it is necessary to continue to improve the system and develop humanresources to conduct engagement based on the characteristics of each asset.

Selfevaluation

We evaluate that the company appropriately manages conflicts of interest
through the establishment and operation of the Responsible Investment
Committee.

◼ Dai-ichi Life fully supports the purport of Japan’s Stewardship Code. We fulfil
our stewardship responsibilities as an institutional investor◼ We build issues related to sustainability into investment policies and processes
for all assets in accordance with this Policy, in order to strengthen the mediumto long-term resilience of portfolios

Policy55

Policy is an excerpt from "Basic Policy for Responsible Investment (5. Initiatives in Compliance with the Japanese Stewardship Code)" (same on the next page and thereafter).
https://www.dai-ichi-life.co.jp/english/dsr/investment/pdf/ri-report_006.pdf

Compliance with
Stewardship Code

Our Compliance with Japan’s Stewardship Code (Self-evaluation)《Principal３》
Institutional investors should monitor investee companies so that they can appropriately fulfill theirstewardship responsibilities with an orientation towards the sustainable growth of the companies.
《Principal４》
Institutional investors should seek to arrive at an understanding in common with investee
companies and work to solve problems through constructive engagement with investee
companies

PolicyTo help enhance the corporate value of investees from a medium- to long-term perspective,
we continue our engagement with these companies concerning their business strategies,
financial strategies, and shareholder return policies, among others, as well as governanceand initiatives to address environmental and social problems and addressing any problems
after sharing our understanding with them.

Achievements

As a result of our ongoing engagement with investees to share with them the issues
we consider, 90% of the ESG issues we established prior to 2019 have been
resolved. When engaging, we continued to improve our methodology for
identifying and resolving key issues for investees based on the results of research on
ESG themes and continued to engage with the top 50 GHG emitters as we did in theprevious year. In addition, we continue to participate in initiatives related tocollaborative engagement, such as the Stewardship Activities WG of the Life
Insurance Association of Japan and the Institutional Investors Collaborative
Dialogue Forum.

Selfevaluation

We believe that our understanding of the situation of investee companies and ourongoing engagement with them have led to the resolution of issues. Going forward,
we will continue to select and research important ESG themes, systematicallyincorporate non-financial information of companies into our corporate evaluations,diversify our approaches to dialogue to improve effectiveness, and further enhance
our engagement through participation in collaborative engagements.

56《Principal５》
Institutional investors should have a clear policy on voting and disclosure of
voting activity. The policy on voting should not be comprised only of amechanical checklist; it should be designed to contribute to the sustainablegrowth of investee companies.
◼

Policy◼

The Responsible Investment Department determines whether to vote for or against corporate
matters in accordance with the criteria for exercising voting rights, which were establishedbased on deliberations made at meetings of the Responsible Investment Committee.
We regularly review the criteria for exercising voting rights from the viewpoint of maintaining
or enhancing the medium- to long-term corporate value of the investees, and publicly disclosethe details of these reviews

Achievements

Based on deliberations at the Responsible Investment Committee, the voting criteria wereamended and published as of April 2023. In the said revision, it was incorporated that voting
rights shall be exercised based on ongoing engagement with respect to the diversity of the Boardof Directors and other matters. With regard to the exercise of voting rights, proposals that attract
significant public attention are deliberated by the Responsible Investment Committee, while
shareholder-proposed proposals for which quantitative exercise criteria have not been
established and proposals involving scandalous companies are discussed at meetings within the
Responsible Investment Promotion Department for each individual proposal before a decision ismade on whether to vote for or against the proposal.

Selfevaluation

In reviewing the criteria for the exercise of voting rights, the Company conducteddiscussions from a multifaceted perspective, taking into account the external
environment and the trends of other institutional investors. In making individual
decisions for or against voting rights, the Company evaluates that it is responding
from the perspective of maintaining and enhancing corporate value, without beingbound by formal criteria.

Compliance with
Stewardship Code

Our Compliance with Japan’s Stewardship Code (Self-evaluation)《Principal６》
Institutional investors in principle should report periodically on how they fulfill
their stewardship responsibilities, including their voting responsibilities, to theirclients and beneficiaries.

《Principal７》
To contribute positively to the sustainable growth of investee companies, institutional investors
should develop skills and resources needed to appropriately engage with the companies and to
make proper judgments in fulfilling their stewardship activities based on in-depth knowledge of theinvestee companies and their business environment and consideration of sustainability consistent
with their investment management strategies.

PolicyWe regularly announce any updates on the activities we carry out to fulfill
our stewardship responsibilities, including engagement and exercising our
voting rights, on our company website.

PolicyTo ensure that stewardship activities are carried out based on an in-depth
understanding of an investee company and its business environment, ourmanagement promotes initiatives to establish organizations needed tomeet this objective, and to train employees with a high level of expertise.

Achievements

The results of the exercise of voting rights are disclosed on the Company's website on aquarterly basis. In this disclosure, the relevant provisions of the voting standards that were in
conflict with the voting rights exercise criteria are clearly indicated for proposals that were
opposed, and for proposals that were discussed by the Responsible Investment Committee, thereasons for the decision to approve or reject are stated in writing. In addition, in the Responsible
Investment Activity Report (this report), in addition to explaining the results of our exercise of
voting rights throughout the fiscal year, we disclose the progress in resolving issues at investee
companies that we have set, the points of dialogue for each agenda item in our engagement,
specific examples of dialogue, and other information.

Achievements

In April 2017, the Responsible Investment Promotion Department was established as thedepartment exclusively responsible for responsible investment, and in April 2020, an ESG
analyst was newly assigned to the department. In addition, members of the Responsible
Investment Promotion Department participated in meetings held by the Stewardship Activities
WG and the ESG Investment and Loan Promotion WG of the Life Insurance Association ofJapan to exchange opinions with external experts, etc. In addition, they actively exchanged
opinions with THE NET-ZERO ASSET OWNER ALLIANCE, which is participating ininitiatives related to climate change. In addition, the Company actively exchanges opinions withinitiatives such as THE NET-ZERO ASSET OWNER ALLIANCE, in which it participates.

Selfevaluation

We believe that the voting results are disclosed with a certain degree of transparency,
including the reasons for the Company's decisions. Regarding engagement, we also
appreciate that engagement efforts are described in a manner that is easy for external
stakeholders to understand, by including both key points and specific examples during
dialogue. We believe that continued efforts are needed to further improve the disclosure of
stewardship initiatives and progress on issues.

Selfevaluation

The company is evaluated as appropriately promoting the development ofsystems and human resources to enhance the sophistication of its
initiatives through the establishment of an organization dedicated toresponsible investment including stewardship activities and ESG analysts,
internal training by ESG analysts, and participation in external study
groups and opinion-exchange meetings.

57

Responsible Investment
Report 2023

Report on stewardship activities

4

Voting policy and voting records

Engagement Partner Survey
Results (Third-party
Evaluation)
As in the previous year, we continued to receive
high marks for our engagement and the content
of our Responsible Investment Report (thisreport), according to the results of a survey of ourengagement partners. Nearly 80% of the
respondents said that engagement with us wasmeaningful, with "accurate recommendations"and "provision of meaningful information" being
the most common reasons given. The percentageof respondents who provided feedback on thecontent of the engagement with us to the board of
directors or management remained high,confir ming that they are actively sharing thecontent of investor dialogue internally withmanagement.

58

Engagement Partner Survey Results
Where to report the details of theengagement with us

The reasons for engagement with us wasmeaningful
Precise content
Recommendations

61%

Providing meaningful
information

57%

Appropriate timing,time, and means ofengagement

35%

Unrecognized issues
noted

Others1%

Specific issues on which have taken or will takeaction based on the engagement with us
68%
50%

governanceHumanrights37%
24%

Financialstrategy
Others

18%

8%

74%
60%
67%

Directors in charge ofcorporate planning,finance, IR,.

None

Climatechange42%
35%

Board of directors

Departments in chargeof corporate planning,finance and investor
relations

9%Management
strategy

27%

48%
45%
44%
4%
6%
4%

2020

2021

2022

The part particularly informative in"Responsible Investment Report”
Responsible investment
policy43%

35%

Stewardship report
ESG investment report22%

To achieve carbon neutrality
in investment portfolio

22%

Overview of responsible
investment
Framework for
responsible investment

20%
13%

Responsible Investment
Report 2023

Message from the Chairperson of the
Responsible
Investment Committee

Kazuyuki Shigemoto
Responsible Investment Committee
Chairperson, Managing Executive Officer,
and Chief General Manager, Investment

Promoting Responsible Investment to Realize a Sustainable Society
Where the Well-being of All People Is Essential

Thank you for your continued understanding and cooperation with our responsible

As an institutional investor, we believe that we have a significant role andinvestment activities. As an institutional investor that manages funds entrusted byresponsibility to play not only in achieving net zero emissions for the Group as apolicyholders in a wide range of assets over the long term, we are actively engaged

whole, but also in realizing the decarbonization of society as a whole, and we willin responsible investment with the aim of contributing to the resolution of important

continue to implement more effective measures to achieve this goal. Sustainabilitysocial issues to realize a sustainable society, which is the premise for the wellbeing

issues include a wide variety of topics, such as environmental issues includingof all people, while securing stable investment returns over the medium to longclimate change and natural capital, respect for human rights or human diversity,

term. We have positioned climate change as the most important issue in responsible

and corporate governance. In this year's Responsible Investment Report, we also

investment and joined the Net-Zero Asset Owner Alliance (NZAOA) in 2021,

described our efforts to improve the sustainability of natural capital, incorporate

committing to a net-zero investment portfolio by 2050, and working with investee

human rights risks into our research and investment decisions, and engagements.

companies to achieve this goal. In addition, we have been making efforts to

We believe that the issues that need to be resolved in order to realize a sustainable

contribute to the transition to a net-zero society by supporting efforts toward

society would be more diverse and more important , and we will continue todecarbonization through engagement, transition finance. In order to accelerate theexpand the scope of our responsible investment themes and incorporate them into

response to climate change throughout the Dai-ichi Life Group, in August 2023,

our investment decisions. We recognize that there are many issues that we need to

Dai-ichi Life Holdings formulated the "Net Zero Transition Plan“, a comprehensive

address, all of which are challenging and difficult to achieve if we only extend ourset of targets, strategies, and governance structure to achieve net zero.

efforts to the past. We intend to promote responsible investment throughcollaboration and co-creation, working with a variety of stakeholders, including

other financial institutions, corporations, and government agencies.

59

第1章 イントロダクション
Responsible Investment
Report 2023

AppendixDefinition of our ESG investment approach
Glossary
Links

Responsible
Investment
ESG
investment
approach
Report 2023

ESG investment method

Definition of our ESG
investment approach

61

Definition

ESG integration

Systematically incorporate ESG factors into the process of investment
decisions

Positive screening

Build a portfolio of companies with high ESG ratings

Negative screening

Exclude certain industries, companies, etc. from the portfolio

ESG themed investment

Investments to assets with themes that lead to solutions to social issues,
based on the premise of profitability(Climate Change Solution Investment: of which Investment that
contribute to solving climate change issues)

SDGs bondinvestment to international organizations that promote projects that
contribute to the achievement of the SDGs(Green Bonds, Social Bonds,
Sustainability Bonds, etc.)

SDGs project

Funding for projects that contribute to the achievement of the SDGs
(social infrastructure development, environmental conservation, etc.)

Impact investment

investment that aims to both generate investment income and social
impactGlossary

Term

Explanation

Green bond

Bond issued to raise funds needed for environmental initiatives (tackling global warming, renewable energy measures, etc.)

Corporate Governance Code

Code of conduct on corporate governance outlining behavioral standards to be followed by listed companies. Established in 2015, it provides guidelines for securing shareholder
rights and equality, ensuring appropriate information disclosure and transparency, and the responsibilities of the board of directors.

Sustainability bonds

Bond issued by limiting the use of funds to businesses contributing to environmental and social sustainability

Stewardship Code

Code of conduct of institutional investors to promote the sustainable growth of companies. Established in 2014, it provides guidelines for the formulation of stewardship policies,
development of structures for conflict of interest management, exercise of voting rights, and other efforts.

Social bond

Bond issued to raise funds needed for solving social issues

Transition finance

Provision of funds for initiatives to transition out of an economy that uses large quantities of coal to a low -carbon economy

Project finance

Provision of funds obtained from a specific project (cash flow) as a source of repayment

Hedged foreign bond

A foreign bond that can reduce the impact of foreign exchange fluctuations on income and expenditure by using a mechanism that avoids foreign exchange fluctuation risks(hedging)

Portfolio

A collection of financial products (stocks, bonds, etc.) held by investors

Materiality

Critical issues related to the environment, society, governance, and other areas that may have a significant impact on the sustainability of a company’s business model

Universe

A collection of financial products (stocks, bonds, etc.) chosen for investment in accordance with a certain objective

62

Glossary

Term

Explanation

Climate Action 100+

A global initiative of institutional investors that engages companies with large greenhouse gas emissions to take actions, including improving climate change governance,
curbing emissions, and strengthening information disclosures

KPI

Acronym for Key Performance Indicator. An important indicator measuring progress toward achieving a business goal.

PRI

Acronym for Principles for Responsible Investment. An initiative advocated by then UN Secretary-General Annan to the financial industry in 2006. It presents principles aimed
at incorporating ESG issues into investment decision-making by institutional investors.

QOL

Acronym for Quality Of Life

ROE

Acronym for Return On Equity. It is the ratio of net income to a company’s own capital and is one of the management efficiency indicators showing how much profit isgenerated relative to capital.

SBT

Acronym for the Science Based Targets initiative that sets greenhouse gas reduction targets for companies conforming to accepted scientific knowledge inline with the standards
outlined in the Paris Agreement

WACI

Acronym for weighted average carbon intensity calculated by multiplying the carbon-to-revenue intensity of each company by the holding ratio of our portfolio

63

LinksLinks to Responsible Investment Resources

Integrated report

Responsible investment policies

https://www.dai-ichi-life-hd.com/en/investor/library/annual_report/2023/pdf/index_001.pdf
https://www.dai-ichi-life.co.jp/english/dsr/investment/ri-report.html

Sustainability report

ESG Investment cases

https://www.dai-ichi-life-hd.com/en/sustainability/report/index.html

https://www.dai-ichi-life.co.jp/english/dsr/investment/esg.html

Net zero Transition plan
https://www.dai-ichi-life-hd.com/en/sustainability/environment/nztransitionplan.html

64

The Dai-ichi Life Insurance Company, Limited
13-1,YURAKUCHO 1-CHOME,CHIYODAKU,TOKYO,
100-8411 JAPAN