INTEGRATED REPORT
2023

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSIntroducing ORIXDATAORIX INTEGRATED REPORT 2023

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Contents
Introducing ORIX

Corporate Philosophy

ORIX is constantly anticipating market needs and working to contribute tosociety by developing leading financial services on a global scale andstriving to offer innovative products that create new value for customers.
Management Policy

1

ORIX by the Numbers

3

A Diverse Portfolio of Businesses

4

ORIX in Society

5

Responding to Social Issues and SDGs

6

CEO Message

7

Value Creation Story

13

Value Creation Model

14

ORIX’s Value Creation Story

15

History and Inherent Values

16

Value Drivers

17

Model for Adding Value

18

Value Creation Case Studies

19

Creating Value

23

1. ORIX strives to meet the diverse needs of its customers and to deepen trust by constantly providing superior services.

Medium-term Direction

24

2. ORIX aims to strengthen its base of operations and achieve sustained growth by integrating its resources to promotesynergies amongst different units.

ESG-related Material Issues and Key Goals

28

Sustainability Promotion and Governance Structure

29

Status of Initiatives to Address ESG-related Material Issues and Key Goals

30

3. ORIX makes efforts to develop a corporate culture that shares a sense of fulfillment and pride by developing personnel
resources through corporate programs and promoting professional development.

Addressing Climate Change

33

Initiatives for Human Rights /Sustainable Investing and Lending36

4. ORIX aims to attain stable medium- and long-term growth in shareholder value by implementing these initiatives.

Action Guidelines
Creativity
Develop the flexibility and foresight to constantly takeactions that are creative and innovative.

Management Foundation that Supports Sustainable Growth38

Human Resources Strategy

42

Risk Management

46

Promoting a Digital Transformation

49

Corporate GovernanceIntegration
Enhance ORIX Group strength by actively exchanging
knowledge, ideas, and experiences.

37

Financial Strategy and Capital Policy

50

Corporate Governance at ORIX

51

Management Team53

Messages from Outside Directors

55

Evaluation of Effectiveness of the Board of Directors

57

Activities of the Board of Directors and the Three Committees

58

Compensation System

59

Execution of Operations Framework

61

Management Team: Executive Officers and Business Unit Managers

62

Strategies by Business

64

Data

81

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

About Integrated Report 2023
Applicable Scope
ORIX Corporation and its Group companies in Japan and around the world

Editorial Policy

Reporting Period

ORIX issues integrated reports to give shareholders, investors, and amore easily understood manner. For broader and more detailed

The fiscal year ended March 2023 (April 1, 2022 to March 31, 2023)

wide range of other stakeholders a comprehensive understanding of

information, please refer to the “Investor Relations” and “Sustainability”

ORIX as an enterprise and of its continuing growth.

sections of the ORIX Group website.

Note: Some activities and information contained in this report are from before or after the reporting period.

Reference Guidelines• The International Financial Reporting Standards (IFRS)Foundation (the former Value Reporting Foundation),“International Integrated Reporting Framework”

Starting in 2023, we have consolidated information from our

ORIX will continuously enhance its information disclosure to achieve

Sustainability Report into the Integrated Report. By compiling financial

a deeper dialogue with all its stakeholders through the Integrated

and non-financial information into one concise report, we believe that

Report. We look forward to hearing your valued opinions on this report

we can convey our roadmap for mid- to long-term value creation in aand other matters.

• The Ministry of Economy, Trade and Industry,“Guidance for Collaborative Value Creation”

Key Points of Integrated Report 2023

Inquiries

The CEO Message contains CEO Makoto Inoue’s self-assessment of

ORIX Corporation Investor Relations and Sustainability Department

his role since taking office in 2014, his approach to capital recycling and

The Messages from Outside Directors section offers varied

Phone: +81-3-3435-3121

thorough due diligence learned through his duties, the importance of

perspectives on issues and expect ations for ORIX, including

URL: https://www.orix.co.jp/grp/en/contact/inquiry-eng.html

learning from failures, passing the torch to the next generation, anddigitalization, succession, sensitivity to financial markets, our approach

Information Disclosure

ORIX’s future management structure, as well as his thoughts on

to ESG initiatives, and the pursuit of “the ORIX Way.”promoting sustainable business and human resources. The message

Primary Disclosure Channels

ORIX discloses information through multiple platforms and media so awide range of stakeholders, including shareholders and investors, canacquire a multifaceted understanding of its sustainable growth.
Main Content

Annual Reports

Latest Information

also includes an update on the corporate purpose statement that iscurrently being formulated, and his thoughts on disseminating the
purpose statement so that ORIX can achieve new growth.
The Value Creation Story uses two business case studies to explain
ORIX’s unique model for adding value, which is the most important
aspect of our value creation model.
The sections on our Medium-term Direction and Initiatives for ESG
describe and review our business strategies and progress toward ESG

NonFinancial

goals from a Group-wide perspective, as well as our growth strategies
Group website Sustainability section

Financial

Integrated Report

Securities Report (Japanese only) / Form 20-F

Group website Investor Relations section

and initiatives for sustainability in each business unit, including a reviewof the fiscal year ended March 2023.

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VALUE CREATION STORYINTRODUCING ORIX

CREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

ORIX by the Numbers
ORIX has been entering new business fields since its founding as a leasing company in 1964, and has emerged as a uniquecorporation unlike any other worldwide. We have realized sustainable growth by building a diversified business portfolio while
responding to changes in the environment.
Fiscal year ended March 2013

Fiscal year ended March 2023

¥111.9 billion¥290.3 billion
8.5 %
¥85.6
34,737Net Income*1

7.4 %

ROE
Dividends per Share¥13.0

Number of Employees

19,043Net Income¥290.3 billion

As of March 31, 2023

58 yearsGlobal Network
28 countries and regions
Financial Soundness Single A credit rating or higher
Continuous Profitability

Profits by Segment
Overseas(Total 35%)

Overseas(Total 25%)

10%

12%

Corporate Financial Services andMaintenance Leasing

18%

10%

0%*2

3%

Total
Segment Profits

9%¥195.4 billion
13%

9%

7%

Real Estate
PE Investment and Concession

37%

12%

Total
Segment Profits

Insurance¥406.2 billion

5%8%Environment and Energy

13%

Banking and Credit

8%
9%

1%

1%

Aircraft and Ships
ORIX USA
ORIX Europe

16%

Asia and Australia

Net Income
1964

1975

1980

1985

*1 Net income refers to net income attributable to ORIX Corporation shareholders.
*2 There was no segment profit for ORIX Europe for the fiscal year ended March 2013. ORIX acquired the Robeco Group in July 2013.

1990

1995

2000

2005

2010

2015

2020

2023

Years ended
March 31

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INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

A Diverse Portfolio of Businesses

Credit screening and financing skills

ORIX’s expertise and breadth of businesses continue to grow as we meet customer
needs and respond to changes in the economic environment.
We have expanded from our original leasing business into a diverse array of areas,delivering a wide variety of products and services to corporate and individual
customers, regional communities, and in social infrastructure.

Expertise in handling tangible assets

Leasing

Segments

Corporate Financial
Services andMaintenance Leasing

Financing and fee businesses, leasing and rental of
automobiles, electronic measurement instruments,
ICT-related equipment, etc.

Real Estate

Real estate development, rental, and management,
facility operation, and real estate asset management

PE Investment andConcession

Private equity investment, operation of airports andwater businesses

Environment andEnergyRenewable energy in Japan and overseas, electric power
retail, energy-saving services, sale of solar panels andelectricity storage systems, recycling and waste
management, and resource recycling

Insurance

Life insurance, including medical insurance anddeath insuranceBanking and Credit

Real estate investment loans, corporate loans, consumer
finance, trust business, guarantees of unsecured loans
handled by other financial institutions, and housing loans(Flat 35)

Aircraft and Ships

Leasing and asset management services for aircraft
and ships

ORIX USA

Finance, investment, and asset management in the Americas

ORIX Europe

Asset management of global equity and fixed income

Asia and Australia

Finance and investment businesses in Asia and Australia

1998｜Banking

1973｜ Lending

1983｜Investment

1991｜Life Insurance

2010｜Asset Management

Main Businesses

1964｜Leasing

1971｜Ships

1978｜Aircraft

1999｜Loan Servicing

2016｜Concession

1986｜Real Estate
1973｜Automobiles

1995｜Environment and Energy| 04

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSORIX in Society

DATA

ORIX INTEGRATED REPORT 2023

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Note: The illustration on this page represents a fictitious location created to introduce the products and services of each segment.
Please refer to pages 64 to 80 for details on the businesses of each segment.

Based on an approach of contributing to society through our business activities, we provide a variety of products and services in a broad range of businesses
in 10 segments. This section introduces some of our products and services.

Aircraft leasing

Airport operation

Power storage station

Wind power generation

Ship leasing

Hydropower generation

Drone rental
Waste treatment facility

Water facility operation
Roof-mounted solar power generation

Condominium repair

Mobile bank branch vehicle

Inn operation
Logistics facility development

Mega solar power generation

Hotel operation

Theater operation
Robot rental
Aquarium operation

Office building development

Transformer rental

Deposits
Condominium development

Indoor baseball stadium operation

Commercial facility development

Preventive
healthcare service

Real estate lending
3D printer rental

Car sharing

Loans

Truck rental
Car rental

Life insurance
Asset management

Consumer finance
Used car sales

PE investment

Automotive leasing

Business succession

Examples of Products and Services by Segment● Corporate Financial Services and Maintenance Leasing: Loans, business succession,
preventive healthcare service, auto leasing, car rental, truck rental, car sharing, used car sales,mobile bank branch vehicle, drone rental, 3D printer rental, robot rental, transformer rental● Real Estate: Office building development, logistics facility development, commercial facility
development, aquarium operation, inn operation, hotel operation, theater operation, condominium
development, condominium repair, asset management● Environment and Energy: Mega solar power generation, roof-mounted solar power generation,wind power generation, hydropower generation, power storage station, waste treatment facility● Aircraft and Ships: Aircraft leasing, ship leasing● PE Investment and Concession: Private equity investment, airport operation, water facility operation● Insurance: Life insurance● Banking and Credit: Deposits, loans, real estate lending, consumer finance● ORIX Europe: Asset management● ORIX USA: Loans, real estate lending, asset management, private equity investment● Asia and Australia: Auto leasing, loans, private equity investment

VALUE CREATION STORYINTRODUCING ORIX

CREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

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Responding to Social Issues and SDGs
ORIX aims to bring new vitality to companies and people in order to realize a sustainable society.
Uncertainty in society is increasing due to a complex interplay of factors, including deepening environmental problems and changes to industrial structures. This opaque outlook makes predictionsdifficult. In this age of uncertainty, ORIX is using its diverse business portfolio to help resolve various social issues.

Social Issues We Can Help Resolve

Environmental Issues

Material Issues and Key Goals

ORIX has identified material issues andkey goals related to ESG.
Page 28 ESG-related Material Issues and Key Goals

Climate change / Reducing GHG emissions

Conserving energy / resources

Promoting a circular economy

Waste treatment and reduction

Climate change / Spreading andpromoting renewable energy generation

Biodiversity / Environmental conservation

Social Issues

Disaster recovery
Aging society
Promoting health /Extending healthy life expectancy
Addressing aging public infrastructure
Stable energy supply

Investments andlending that take ESG into accountSafe working environment
Improving labor productivity

Vitalizing small andmedium-size enterprises

Safe and secure mobility solutions

Regional vitalization

Promoting innovation andtechnological change

Decreasing workforce

Contributing to Society through Our Business Activities

The Society We Envision

We aim to realize a vibrant and sustainable
society by resolving social issues throughour diverse business activities.

INTRODUCING ORIX

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CEO Message
What We’ve Accomplished and other operations. In terms of rising U.S. dollar interest rates brought

Self-assessment as CEO

on by changes in fiscal policy, we need to adjust our market timing evenIn the fiscal year ended March 2023, net income decreased 8.5% year-

more nimbly. For these reasons, I currently give myself 60 out of 100

over-year to ¥290.3 billion. Segment profits totaled ¥406.2 billion, andthis time around. ORIX started out in the leasing business and has

would have increased ¥38.4 billion year-over-year excluding the impact

grown by deploying capital and assets in neighboring businesses. Weof the gain on the sale of Yayoi in the previous fiscal year. The economic

have evolved our portfolio into its present form while transforming

environment continues to be challenging due to the COVID-19

market changes into opportunities for growth. Our history of selectively

pandemic, the Russia-Ukraine conflict, global inflation, and interest rate

diversifying our business portfolio and our experience drive our ability tohikes in various countries, but ORIX’s performance remains solid.

maintain dialogue with markets and generate growth.

Founded in 1964, ORIX will celebrate 60 years in business in 2024, andthis will also mark the tenth year as CEO since my appointment in June

Lessons from Ship Leasing about Capital Recycling and2014. In Integrated Report 2019, I candidly assessed my performance for

Thorough Due Diligence

my first five years as CEO and gave myself 50 points out of 100. Four

ORIX was called Orient Leasing Co., Ltd. when I joined in 1975, and it

years have passed, and I would now give myself 60 out of 100.

had only several hundred employees. My first assignment as a new

One issue I identified in 2019 that needed to be addressed was

employee was in the shipping business, which was in dire straits

stronger back and middle office corporate functions. Althoughbecause of a global shipping recession. Ship lending accounted for adashboards and other approaches have added sophistication to our risklarge percentage of total assets, and a concerted companywide effort

management system, I am still not entirely satisfied. I am promoting

was required to recover outstanding debts. Most of my work as a new

digital transformation (DX) as chairman of the Information Technology

employee involved repossessing ships. Repossessing a vessel used toManagement Committee to ensure that we properly incorporate ourcollateralize credit generates no value in and of itself, so in 1977 ORIX

front-line expertise and the knowledge of technology experts. However,created a ship maintenance and management company called Perseus

I feel we need to move faster, so I dock myself points in this area.

Shipping Co., Ltd. (now ORIX Maritime Corporation) where I was also

On the business front, the timely sale of Yayoi and owned shipping

involved in ship operation. Ship leasing led ORIX to launch a business

Makoto Inoue

vessels exemplifies ORIX’s ability to adeptly anticipate change.

that monetized repossessed assets by operating them, and thisMember of the Board of Directors
Representative Executive Officer
President and Chief Executive Officer

However, we still have challenges. Examples include evolving our

experience has significantly influenced ORIX’s approach to expanding

business model by enhancing our U.S. asset management businessits business portfolio.

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CEO Message

Moreover, ship leases generally have long-term durations of ten

an issue and ask why Inoue had let it happen on his watch. Even now,

years or more, and something almost always happens during the lease

when hearing presentations about investment and credit deals, I often

term. Back in the 1970s, many ship lease contracts were non-point out concerns I may have, and then check the draft of thecancellable, and stipulated substantial penalties that the customer, as

contract with my own eyes and let the people responsible know about

lessee, would bear in the event of cancellation. As a result, customers

the importance of checking contracts in advance and conductingthat no longer needed leased vessels for business for whatever reason

thorough due diligence. People on the front lines do not want the CEO

would let them sit in port, rather than cancel the deal and pay the large

looking over their shoulder, and I also do not think a CEO necessarily

penalty. This ultimately damaged the asset value of the collateral andneeds to do that. At the same time, my experience with ship leasing

the 2008 global financial crisis, and the number of ORIX people who

created credit problems. I felt that contractually prohibiting customers

deals during an industry downturn drove home the need to thoroughly

have not had the experience of recovering from failures or resolvingfrom returning unwanted vessels was an unreasonable business model.

confirm details and conduct due diligence prior to committing tomajor crises during this time is slowly increasing, which gives me cause

Rather, I saw value in a financial business model with mechanisms that

contracts, and I like to share that experience with the people of ORIX

for concern. Other companies may often remove people responsible forallowed us to treat leased vessels as operating assets we could recycle

when the opportunity arises.

failed deals, but at ORIX, these individuals are neither dismissed nor

for subsequent lease to other customers. This is a capital recycling

The experience of failure gives rise to
a company’s growth.

penalized. The reason is simple: a committee had approved those failed

mindset. Both asset and capital turnover require committed effort, andFinding the Strength to Grow after Experiencing Failure

deals, so the failure was not simply a result of the responsible

there is no “dream deal” that generates profits without effort. However,I also had challenges when I was responsible for aircraft leases thatmanager’s judgment. ORIX acquires expertise by keeping people evenno one knows when and to what extent market changes will occur, so

were similar to the troubles I faced while starting a new business

if they experience failure during execution. The expertise we gain from

ORIX must always be prepared to turn over and recycle assets andhandling ship operations during a shipping industry recession. At one

failure is invaluable. People may experience the unpleasant feeling of

capital on a daily basis.

point I went to South America to repossess aircraft that ORIX had

having their back against the wall when they fail, but that experience

Furthermore, the manager initially responsible for long-term deals

leased to an airline company that went bankrupt. A coup d’état had

will help ORIX grow in the future. A committee initially approves deals,such as ship leases is not necessarily responsible for that deal until its

taken place and soldiers with machine guns were at the airport. People

and also stays in touch with them through reports on progress and any

maturity. In many cases, someone else assumes responsibility in thewere demanding money, and I felt I was in danger. I had no choice but

problems, and all relevant parties discuss and share their experiences.

midst of the deal term. Ever since my days handling ship lease deals,

to resolve this failed deal, and at the time, I felt as though no one in

When a problem arises, I tell the responsible manager that I have no

I have been highly focused on thoroughly checking contracts at theORIX could ever have had such an experience of wrapping up such aproblem if ORIX loses ¥100 million but ends up gaining ¥10 billion.

beginning of the deal and at the time of handover to eliminate

deal where so many things went wrong. In retrospect, I learned much

Failure is not bad in and of itself, but I do expect people to grow by

problems for the new manager. “Always Be Thorough” just might befrom this failure.

rebounding from it.

my motto. The last thing I wanted was for a new manager to run into

ORIX has experienced a period of relative calm in the 15 years sinceINTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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CEO Message

Passing the Torch onto the Next Generation and compliance, along with the ability to objectively evaluate talent.

ORIX Today 

People Who Evolve Rather than Follow

I am not breaking any new ground here by saying this—these qualities

The Post-COVID Business Environment

Nine years have passed since I became CEO, but I have always been

are simply crucial for ORIX to generate sound growth in the future.

Japan reclassified COVID-19 as a less-severe, Class 5 infectious diseaseaware of the need to pass the torch to the next generation. Some feelin May 2023, and economic activities are returning to normal. COVID-19

that a successor who follows in the current leadership’s footsteps

significantly impacted airport concession, domestic inn and hotel

should be selected, but I think otherwise. Our next CEO should haveenough self-confidence to even reverse my way of doing things,
if necessary.

Management intuition is honed throughpractice, not learned from a teacher.

operations, and aircraft leasing. However, the recovery in inbounddemand, growth in international passengers, and higher occupancy
rates at inns and hotels will contribute to a steady recovery in

The mindset of a company’s leader, the CEO, changes the corporate

performance in these businesses. The diminishing talent pool due toculture to some extent. ORIX’s corporate culture is manifested in how

demographic trends is a major concern in Japan. We are improving

everyone coalesces around the CEO. Our corporate culture has the

Corporate managers need to consider a wide array of stakeholders.

compensation to attract more people, but stable hiring is a pressing

flexibility to accept that ORIX will continue to grow under a new CEO

ORIX has a wide range of investors, some of whom push for short-term

issue. The aircraft leasing business may also need some time to restore

with a somewhat different approach. I would like to see the next leader

returns. At the same time, many others call for sustainable growth.

earnings even though people are traveling more frequently again.

effectively express their management style on the way to shaping theSatisfying all stakeholders at all times is not easy, but we have to

Negative or zero Japanese yen interest rates may take some time tonext iteration of ORIX’s corporate culture.

maintain a reasonable and mutually agreeable relationship. We maketurn positive. When rates rise, however, I am confident that our Corporate

decisions about short-term results while gaining understanding of

Financial Services segment will be able to fully demonstrate the value

The Right Management System for the Future

growth strategies to guide us in the future. Management is responsibleof its customer base in Japan, talent pool, and nationwide network.

Given the extent to which the Group’s business portfolio has expanded,for determining how to fulfill both long-term and short-term missions.

When I first started at ORIX, the leasing business’s sources of

ORIX’s next CEO will most likely not be able to take a granular view ofThis is something we always have to think about because no single

profits consisted of about 15% lease fee income, which earned a 5-6%

things as I do. We delegate authority for our businesses to the head ofanswer is correct. Honestly, nobody can learn this from a teacher, so

margin on funding costs of 7-8%. At that time, profits could covereach segment within a system that enables the CEO to concentrate on

everybody has to hone their management intuition through practice.

losses even if one or two credit receivables out of a hundred became

overall portfolio management and the Board of Directors, including

The Nominating Committee will decide how to proceed with the CEO

nonperforming. Leasing margins in the current financial environment

outside directors, to supervise execution. This is a management system

succession plan, but my hope is that the successful candidate will be

are in the 0.2% to 0.3% range, so even a single mistake can be fatal.

suitable for the next generation. Given the responsibilities of the next

fully responsible for leadership once I have shared everything I can

Taking risks and learning after bouncing back from mistakes has

generation of senior management, any person qualified to be CEO will

about being the CEO.

become untenable in leasing and finance. Therefore, we have difficulty

have excellent knowledge of and a strong desire to protect governancegenerating profits from leasing and senior loans collateralized by

INTRODUCING ORIX

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CEO Message

movable assets, leaving us no choice but to shift to businesses withthe financial crisis of 2008 in mind, and adjust our portfolio while

supply mix would change, and recognized that global warming was

higher returns and higher risks, such as mezzanine and subordinatedcommunicating with the market. Remaining constantly aware of assets,

becoming a serious problem worldwide. We launched the business byinvestments and equity investments. We simply could not commit toliabilities, and capital in each of our 10 segments enables us to

fully mobilizing the Group’s network and knowledge, and had 3.7 GW ofinvestments in the equity business if we did not have the ability to

immediately identify anomalies and make management decisions on

renewable energy power generation capacity in operation globally as ofmake complex and specialized risk assessments. This exemplifies how

exits and other deals together with the head of each segment.

March 2023. This business makes a stable contribution to earnings and

ORIX has grown by transitioning its business portfolio while reflecting

As a result of capital recycling, we typically realize about ¥100on the cumulative lessons gained from failures. More recently, we havebillion in investment gains annually. We are devising ways to better

Japan has a feed-in tariff (FIT) system for solar power generation, so

the view that higher Japanese yen interest rates would create morepresent our past performance and future investment pipeline in our

we had initially been considering strategies to sell our renewable

opportunities to secure spreads on leasing and loans, which led us tofinancial reporting, but incomplete understanding of the reproducibilityenergy business when its cash flow stabilized. However, we expect tomaintain our nationwide network of Corporate Financial Services

and sustainability of our results is an issue. Many of the stock analysts

retain exceptional environmental value in these investments when the

personnel. Corporate Financial Services has also collaborated with

who cover ORIX are experts in the financial sector, in which stable

FIT period ends. Rather than committing to a sale at this point, we areother ORIX businesses and emphasized cross-selling, allowing it toearnings tend to be a particularly important driver of higher valuations.

comparing several approaches to optimize growth for ORIX and support

generate 3% ROA without relying solely on interest income. Today,

The investment gains we generate from portfolio replacement arefor a sustainable society.

ORIX is the only finance company in Japan that still has a nationwide

reproducible, not temporary, so we will further improve how weOverseas, our renewable energy business has invested mainly in

network, and I am confident that we will be able to contribute to ourpresent our business and performance so that our audience better

three companies: Elawan Energy S.L. (headquartered in Spain), Greenko

customers again in the finance business and that our network will be

understands this aspect of ORIX.

Energy Holdings (headquartered in India), and Ormat Technologies, Inc.

exceptionally valuable if interest rate spreads widen and once again

contributes significantly to the reduction of CO2 emissions.

(listed on the New York Stock Exchange). We constantly examine

Sustainable Businesses and Sustainable Earnings

whether continuing to hold these companies is the best option, as weOpen capital markets expect companies to go beyond generating

consider the optimal way for ORIX to operate its renewable energy

Capital Recycling Progresssustainable profits by being of use to society, which supports bothbusiness globally. We will flexibly determine whether holding or selling

We are turning over capital by replacing businesses and assets in all

sound corporate growth and the achievement of a sustainable society.

is the best option while considering various factors, ranging from thesegments, and we have reined in the pace of asset expansion toThis is the sustainability mindset of ORIX, which contributes to society

business strategies and locally relevant governance policies of each

improve profitability. We call this “capital recycling,” and it is not an

through business activities. One example of this is ORIX’s renewablecompany to the operating and investment environment andintrinsically difficult strategy. All we have to do is continuously trackenergy business, which we launched in the wake of the Great East

relationships with other stakeholders.

changes in market conditions and our balance sheet, determine theJapan Earthquake in 2011. We decided this business would be a focus

Our Sustainability Policy is common to all 10 segments, not just

optimal balance between debt and equity, keep our experience during

for us because we predicted that Japan’s energy business and power

Environment and Energy. We believe sustainability that supports soundcreate room for profits.

INTRODUCING ORIX

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CEO Message

corporate growth and business profits is key to resolving social issues

Directors supervises execution, which is an extremely importantin step with the characteristics of our business.

function. We help outside directors understand ORIX’s diverse

Head office functions optimized
Corporate Ideals 

for global growth.

Strengthen Risk and Portfolio Management Systems andoperations with presentations by business units, meetings with people
on the front line, and opportunities for outside directors to talk among
themselves. I will encourage supervision and execution initiatives tocontinue with even better Board discussions.

Deploy Dashboards

I currently serve as Chairman of the Board of Directors, but I am

Business units are of central importance for ORIX, and an attitude

We have been enhancing our risk management sophistication byaware of the opinion that an outside director should assume that role,persists that the back and middle office exist solely to provide sales

implementing dashboards and DX initiatives. Delineating the status ofand I think this topic deserves consideration. However, I can say that

support. ORIX has been this way for more than 50 years, so immediate

our overseas portfolio required a particularly significant amount of time,

any Chairperson would have trouble executing their duties if they didchange is difficult. However, as I said at the beginning, management

but progress has been made in this area. We are making progress withnot fully understand ORIX’s diverse portfolio and the global operations

departments will serve an increasingly important role in ORIX’s growth

the volume of quantitative data visible on dashboards and integratedof the Group as a whole. Further discussion by the Board of Directors

going forward, so we are implementing proactive initiatives to enhancethrough DX, but analysis and information on asset quality and outlook

about this topic is therefore necessary.

these departments for further growth.

are still insufficient. For example, if changes in the status of a watchlist

In addition, some executive officers who currently lead business units

I mentioned that a desirable next-generation management structure

item could be monitored in a timelier fashion, the head office could

also serve as directors. Looking forward, we are targeting a corporatetransfers authority to the segment heads and has the CEO focus on

immediately issue a cautionary warning. Addressing these warnings as

governance system in which outside directors play a central role inportfolio management. However, segment heads tend to perceive

soon as they appear would enable front-line operations to initiate

supervising selected directors responsible for execution including thethings in terms of their own segments. Aside from that, segment heads

collection and preclude unnecessary losses. Even a slight delay inCEO, CFO and general counsel. Moreover, we are also considering aalso need to think about portfolio management from a Group-wide

dealing with a problem can make loss recovery impossible and increasesystem for monitoring execution with emphasis on the CEO andperspective in considering issues such as whether the portfolio is too

losses. Improving the sophistication of the dashboard to a level that canmanagement department leaders. The key is to continue discussing

large and the need for capital recycling. We are working to strengthenpresent asset quality in real time will enable us to achieve a satisfactory

corporate governance ideals to evolve a highly effective system.

the portfolio and credit management departments that have theseportfolio management system.

Human Resources, Mid-career Hires, Appropriate Personnel

functions, but they still need to improve. Ideally, we aim to establish a
portfolio management system that will allow us to actively direct capital

Corporate GovernanceEvaluation, and a Diverse Personnel System

recycling for sales operations, and we are implementing various

Outside directors are very active participants in the meetings of ORIX’s

The contributions of mid-career hires have accelerated growth for ORIX.

measures towards this.

Board of Directors, and the discussions can be intense. The Board of

In the fiscal year ended March 2023, the 10 Group companies in Japan

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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CEO Message

hired approximately 650 people, of whom about 70% were mid-career

Insurance and PE Investment have already introduced such reforms.

communicate globally based on that purpose. For example, ahires. The ability of these people with diverse backgrounds to play an

We need to make agile reforms to our personnel system in order tomanagement meeting that brings together the leaders of each segment

active role in our firm depends on whether they can successfully create

attract more highly competitive, specialized people.

at the head office and empowers thorough discussion would be a goodan internal network. ORIX has a broad business portfolio, so mid-career

start. COVID-19 kept us from meeting in person for extended

hires need to build a network of effective relationships within a year or

Defining Our Purpose

discussion, so now we should actually meet face-to-face and deepen

two of joining the Company. I would like to continue to support theseI often wonder about the effect on Group integration if each segment,

discussions to inculcate our purpose so that it does not end up being

efforts in helping people inside and outside the Group alike to capitalize

each Group company, and our operations in each region of the world

just a slogan.

upon their unique expertise.

implemented the optimal business strategy for themselves andI hope that all of our stakeholders will look forward to the execution of

The current responsibilities of our Human Resources Department

transformed their personnel system to suit the characteristics of their

our Purpose Project and the new growth ORIX will generate because of it.

center on personnel operations, leaving room for improvement in terms

industry. Developing a corporate purpose is one of the ways in whichof human resources strategy and talent management. This department

business units and individual companies can make the most of their

Conclusion

can also effectively involve itself in determining whether individual

independence and excel while still enhancing a sense of unity as a

The markets ORIX serves are changing at a whirlwind pace, and we

personnel evaluations conducted by sales departments are truly

Group. We were motivated to launch the Purpose Project in June 2022

cannot let our guard down. ORIX is growing larger and more complex,

appropriate. While positive evaluations are great, Human Resources

because we learned that a number of employees, especially at overseas

but we will successfully encourage a more appropriate valuation fromshould fully identify the root causes of negative evaluations andsubsidiaries, thought that ORIX was just a shareholder in their company.

capital markets by emphasizing dialogue with the market while steadilyproactively implement personnel measures that are optimal for bothThis ongoing project has employees from Japan and around the world

turning each of the plans I have discussed here into realities. By doing so,

employees and ORIX. I have been discussing this kind of proactive

participate in discussions as project members. This process is

I am confident that ORIX will be able to continuously grow as a company.

personnel strategy with Human Resources. We need to gather andmeaningful because many participants indicated these global

In closing, we have integrated the contents of the previously

analyze objective dat a to properly structure human resource

discussions made them clearly aware that they are members of ORIX

separately issued Sustainability Report into our Integrated Report. I will

management functions. Digitalization to collect and effectively deploy

Group. The project has taken more time than initially planned because

be pleased if this Integrated Report helps to deepen your understanding

data will therefore be another key to strengthening the Humanthe discussions have been so lively, and we need to carefully chooseof ORIX.

Resources Department.

the words in the Purpose Statement so that the message is clear for all

We are gradually reforming personnel and salary systems to alignemployees.

them with the markets in each segment, rather than having a uniform

Formulating and announcing our purpose is not the end of thesystem for the Group. This approach to reform considers theprocess, but the real beginning. The challenge is sharing that purpose incharacteristics of the industry to which each segment belongs, andevery part of the Group and building a corporate culture that can

INTRODUCING ORIX

CREATING VALUEVALUE CREATION STORYMANAGEMENT FOUNDATION

Value Creation Story
This section describes how ORIX is creating value basedon the capital resources it has acquired since its founding.

Value Creation Model

14

ORIX’s Value Creation Story

15

History and Inherent Values

16

Value Drivers

17

Model for Adding Value

18

Value Creation Case Studies

19

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 13

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Value Creation Model
ORIX employs the capital resources it has acquired since its founding to create value, using its own value creation model to add further value.
This has enabled us to expand our business into our current 10 segments and to provide value unique to ORIX in multiple markets.
We will continue to provide new value to society by repeating this cycle.

Input
Financial
CapitalOutcome

Robust and sound financial foundation that
supports growth• Debt/equity ratio*1: 1.6X
• Shareholders’ equity ratio: 23.2%• Credit rating: Single A or higher• Liquidity on hand*2: ¥1.4 trillion

Wide variety of tangible assets used in ourleasing, operations, and other businesses

Manufactured
Automobiles / Aircraft / Ships / ICT-related Equipment /CapitalElectronic Measurement Instruments / Inns / Hotels /Aquariums / Solar Power Plants

Intellectual
CapitalValue Creation Process / Output

Expertise in financing and tangible assets +Ability to identify risks

Strategies
Medium-term Direction
Pages 24-27

Economic Value

ESG-related Material Issues
and Key Goals• Return of profits to shareholders
No dividend decrease for12 consecutive years

Page 28

A Diverse Portfolio of
Businesses

Environmental
Value*

Financial perspective / Expertise in handling tangible
assets / Integration of diverse expertise throughcollaboration across the Group both in Japan and overseas

Global and diverse human resources

Human
CapitalSocial and
Relationship
CapitalNaturalCapital• Number of employees: 35,000• Overseas employee ratio: 22%
Employee skills, experience, and desire to innovate /Corporate culture of agility, flexibility, and adaptability

Resources necessary for business activities

Model for Adding Value
Page 18

Value Drivers

Social Value*

Page 17

Corporate GovernanceNote: The above data is as of March
31, 2023*1 Excludes deposits.
*2 E xcludes ORIX Bank and ORIX
Life Insurance.

• Corporate and community revitalization
Operation of businesses for investment andbusiness succession• Diversity, equity, and inclusion; health andsafetyDevelopment of talent who can support
sustainable growth

Natural energy sources such as solar and wind power /Forest resources, water resources, marine resources

Management Capital• Transition to a
decarbonized society
Renewable energy
installed capacity:
3.7 GW• Promotion of a circular economy
Operation of sharing, leasing, and otherbusinesses that make long-term use of
tangible assets

Connections with stakeholders andlocal communities• Global expansion: 28 countries and regions
Extensive customer base / Proprietary sales network• Sustainable earnings growth
58 years of continuous profitability

Pages 50

ORIX’s record of success made us a trusted partner with stakeholders.

* Please refer to the following website for more detailed information on environmental and social value.
Sustainability| 14

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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ORIX’s Value Creation Story
The most important part of ORIX’s value creation model is its unique model for adding value. The following explains how the model for adding value is formed and how we create value.
ORIX has passed down its values and nurtured a distinctive corporate culture. The risk management and talent pool we have cultivated based on these values and corporate culture are ourstrengths, which support our model for adding value as ORIX’s value drivers (factors that increase corporate value). We use our model to create value unique to ORIX in a variety of fields andachieve growth.

ORIX has developed into a unique corporate group by creating new value as it broadens its business by
repeatedly moving into neighboring fields.
That history encompasses the values (discipline that underpins independence and autonomy, as well as
agility, flexibility, and adaptability) and corporate culture (taking healthy risks, cooperation among diverse
human resources) that have been continuously handed down.

History andInherent Values
Page 16

Risk management and our human resources are strengths we have cultivated based on our inherent values
and corporate culture, and they serve as ORIX’s value drivers (factors that increase corporate value).
Risk management: Organizational framework: Identifying and taking risks
Talent pool: Individual capabilities: Grasping contemporary changes, and thinking and acting to turn theminto opportunities

Value Drivers
Page 17

Model for Adding Value
Page 18

Value Creation Case Study 1

Renewable
Energy Business
Page 19

Value drivers support the model for adding value. Value drivers enable us to correctly assess risks andbusiness feasibility, and to take on the challenge of entering new markets. Through our model for adding
value, we create value unique to ORIX in a variety of fields and achieve growth.

After the Great East Japan Earthquake in 2011, we predicted that Japan’s energy situation andpower supply mix would change. Using the knowledge and human resources within the Group,
we were quick to establish a system for promoting renewable energy businesses ahead ofother companies.
As of March 2023, the renewable energy installed capacity of our facilities in operation
globally has grown to 3.7 GW. Capacity expansion to 6 GW is planned for March 2025, with atarget of 10 GW by March 2030. We have also started an operation, management, andmaintenance business for power plants and a development business for energy storage plants.

Value Creation Case Study 2

Concession
Business
Page 21

When the concession system was introduced in Japan upon the revision of the Act on
Promotion of Private Finance Initiative (PFI) in 2011, we started research in-house. Following
the announcement of details of a public offering for the operation of the Kansai International
Airport and Osaka International Airport (Itami Airport) in 2014, we began full-scale activities
with a project team that gathered knowledge and human resources within the Group. After
exhaustive internal discussions about the unprecedented long-term operation period and hugeamount of consideration for the operating rights, we started operating these airports in 2016.
As of March 2023, we are deploying our business know-how to renovate airports, and havealso started other concession businesses such as water businesses.

INTRODUCING ORIX

CREATING VALUEVALUE CREATION STORYMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 16

History and Inherent Values
ORIX has developed into a unique corporate group by creating new value as it broadens its business by repeatedly moving into neighboring fields. Throughout our history, we havecontinuously handed down our values and corporate culture. The risk management and talent pool we have cultivated based on these values and corporate culture are ORIX’s strengths as well as
its value drivers (factors that increase corporate value).

Value Drivers

Our Strengths andCorporate Culture

ORIX’s History and Values

Introduction of leasing as
a new financing method

Diversification / globalization fromrepeatedly moving into neighboring fields

Ramping up full-scale Group operations

Creating new value through diversified
business operations

Expanding in new business fields

1964

1970s

1980s–1990s

2000s

2010s onward

Introduced leasing inJapan as a new
financing method

Overcame the turbulent
era of oil crises andpromoted diversificationand globalization

Expanded new
business fields withunique products
and services

Overcame the global
financial crisis andentered a new stage

Promoted further
diversification fromfinancial to nonfinancial businesses

Standing on Our Own

Into Neighboring Fields

Interdepartmental Group Collaboration

Agile, Flexible, and Adaptable

Change is the Only Constant

The Company was established in 1964 by three
trading companies and five banks to popularize leasing
as a new financing method in Japan. ORIX shiftedaway from doing business through shareholder
trading companies and banks to establish a foundation
as a more independent entity with its own directsales style and way of conducting transactions, andwent public in 1970, only six years after its founding.

D espi te the i mpact of a decl i ne i n capi t alinvestment due to two energy crises, ORIX
continued to grow steadily by repeatedly moving
into neighboring fields to diversify its products andservices beyond leasing. ORIX also focused on
expanding overseas, starting with Hong Kong in
1971, followed by Singapore, Malaysia, South
Korea, and elsewhere.

Competition intensified as a series of new companies
entered the leasing industry. We therefore started
full-scale Group management with strengthened
communication and cooperation among departments
and Group companies. At the same time, measures
including proactive M&A rapidly advanced ORIX’stransformation into an international and diversified
financial services business.

ORIX established a solid revenue base with thesuccess of its diverse expansion strategies thatdeveloped both domestic and overseas markets in
its corporate and consumer, and asset and fee
businesses. After the global financial crisis, ORIX
worked to reinforce its corporate structure andrestructure its business, changing its portfolio in anagile, flexible, and adaptable manner.

As we enhanced our expertise in financing andtangible assets, we expanded into the nonfinancing businesses of investment and operation.
Through further diversification into mega solar
p owe r g e n e r a t i o n , c o n c e s s i o n , a n d o t h e rbusinesses, we continue to take on the challengeof creating new value across industry borders.

Ability to analyze risks

Taking healthy risks

Ability to grasp change

By expanding from financing into investment
and operation, we have cultivated the ability
to analyze risks from multiple perspectives.

ORIX has been independent from an early stage,and has continued to grow by taking intelligent
risks. We have the corporate culture
to conceive and design bold strategies andplans with a high degree of freedom.

ORIX employees swiftly perceive evolving needs
to seek out new value and provide it to society.

Risk Management
Talent Pool Who Can Identify Growth Areas

Cooperation among
diverse employees
Interdepartmental collaboration based on
integrated Group management is the normin our corporate culture. Our diversely talented
employees bring together the expertise to takeon new business opportunities.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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Value Drivers
Risk management and employee talent are ORIX’s value drivers (factors that increase corporate value). Our unique model for adding value is supported by risk management (organizationalframework) and employees (individual capabilities) who embody our inherent values.

Organizational Framework

Risk Management
ORIX has expanded and grown its businesses by addressing
the needs of customers and changes in the environment.
Corporate growth requires identifying and taking risks while
maintaining financial soundness. This mindset is the basisof our risk management.

Inherent

Values×

Accurately judge
business potential asan organization

Discover new businesspotential fromthe knowledge andknow-how gained in the field

Individual Capabilities

Talent Pool Who Can Identify Growth Areas
Based on our concept of “Keep Mixed,” we hire diverse
employees. Each and every employee develops the ability to
grasp contemporary changes and the mindset to turn thosechanges into opportunities. Our people are the source anddriving force behind the growth of ORIX.

Model for Adding Value

Unique Business Modelfor assessing risks and businessfeasibility to lead to value creationand generate growth

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Model for Adding Value
ORIX started off in leasing and has grown by expanding into neighboring businesses. Our ability to take on thechallenge of entering new markets is based on a business model for adding value that allows us to correctly
assess risks and business feasibility to create value and generate growth. Here, we explain the components andfeatures of our model for adding value.
Additional investment

Capital, human resources, andexpertise in emerging growth business areas

EXIT
Sales

Regular monitoring(Verify strategies and plans)

Generate
project
Identify changes in customer
needs and markets

Risk Management / Talent Pool Who Can Identify Growth Areas

Value Drivers

Overview

Each employee ascertains customer
needs and market changes, and utilizes
the Group network to generate projects.

• Communication with customers provides a
deep understanding of their needs andmanagement issues as we consistently aim
to propose optimal solutions.
Human Resources• We have sales networks in Japan andoverseas that have close regional ties, andidentify projects by sharing and collaborating
on inquiries and information obtained fromour network within the Group.
Human Resources• W e do not limit ourselves to a single
investment theme or business, but explore
a broad range of opportunities so that we
can adapt quickly to changes in ouroperating environment.
Human Resources

AssessFinance andinvestIncrease andcreate value

Assess profitability and risk

Assess deals

Increase the value of assets

We utilize our knowledge and expertisein finance and neighboring fields fora clear view of project profitability
and risks.

In the Investment and Credit Committee,
top management decides whethero r not to approve a project whileconsidering opinions of related units.

We utilize ORIX’s unique flexible
financing, Group network, and hands-on
system to improve asset value.

• W ith the expertise in finance we haveaccumulated since our establishment, we
put our financial knowledge and perspectives
at the foundation of all our initiatives inmaking analyses and business decisions.
Human Resources• B y e x p a n d i n g f r o m f i n a n c i n g i n t oinvestment and operation, we have built
up the ability to analyze risks frommultiple perspectives.
Risk• E ven if a risk seems prohibitive at firstglance, we think carefully about whether it
can be turned into one that can be taken,
and identify risks that should be taken
for growth.
Risk• Sales operations staff working in the fieldtake the lead in using their specialized
financial knowledge, and carefully examine
projects through discussions withspecialized units*1.
Human Resources

Risk

Risk Management

Human Resources Talent Pool Who Can Identify Growth Areas• T he Investment and Credit Committee
deliberates and decides on investment
deals that exceed set capital parameters.
(More than ¥1 billion for lending projects, morethan ¥5 million for investment projects*2.)(The Committee consists of the CEO, executive
officers, and Group executives appointed by theCEO, with the CEO as chairperson and final
decision-maker.)
Risk• We exercise disciplined judgment.
(Emphasize entry price and avoid pricecompetition. / For investments, assume an exit
strategy from a 5 to 7-year window, targeting a
15-20% IRR with capital gains and dividends. /Do not factor synergies into investment
decisions. / Confirm that projects will generate
returns commensurate with their risks andexceed our cost of capital. / Evaluate projects
from an ESG perspective using the Sustainable
Investing and Lending Checklist. / Confirm
profitability using IRR and efficiency using ROE
and ROA, among other metrics.)
Risk

Ongoing
operation

Invest in growthbusiness areas

Respond flexibly to changes
in the environment

Comprehensive
management assessment

Open new markets andgenerate sustainable growth

We regularly monitor projects, swiftly
detect changes in the environment, anddevise optimal countermeasures with aflexible mindset.

Top management makes decisions
about project continuation from acomprehensive perspective based on
the opinions of related units.

We realize sustained growth byallocating accumulated capital, humanresources, and know-how to new fields.

• W e conduct regular monitoring after
project implementation.

• W e gain a deep understanding of thebusiness conditions and industries ofinvestees and borrowers, and emphasize
medium- to long-term growth.
Human Resources• For investments,– ORIX invests with its own funds, enablinga flexible response to investment period
extensions and capital increases.
– O ur expert employees manage thebusiness together with investees.
– W e leverage our Group network todevelop customers and expand sales
channels for investees.
– We aim not only to increase the value ofindividual investees, but also to drive
industry reorganization and restructuring.
Human Resources• Depending on the details, discussions areheld with specialized units*1 to use theiropinions as a basis for making decisions.

Monitor(For lending projects, check the businessperformance of the borrower and confirm theunderlying security interests. / For investment
projects, compare and verify business plans against
results, and confirm operations. / Continuously
evaluate profitability using IRR and efficiency using
ROE and ROA, among other metrics. / Continuously
evaluate material ESG risks identified at the time ofinvestment and lending decisions.)
Risk• Monitoring is carried out by business units
and administrative units from theirrespective perspectives, and the results arereported to top management.

(Business units report on unit portfolios and thestatus of individual projects at the Business Unit
Strategy Meeting. / The Enterprise Risk
Management Department creates dashboards
from various perspectives and reports on theportfolio of the entire Group.)
Risk• We consider environmental changes fromthe time the project is executed, andexamine multiple new scenarios regardlessof the initial scenario. Selling is always an
option and we search for the best selling
price and timing.

Risk*1 Specialized units include accounting, legal affairs, taxation, finance, bookkeeping, compliance, real estate appraisal, etc.
*2 The committee rules set amounts for approval authority depending on the details of the case; the above presents an example.

Risk• T he Investment and Credit Committee
deliberates and approves the continuation
or replacement of projects.
Risk• Based on the results of monitoring and thebusiness environment, as well as thestatus of the overall portfolio and individual
projects, we make decisions on continuation,
additional investment, sale, impairment,
and business withdrawal. In the case ofinvestment, we change our strategy
depending on the situation of the project.
(For example, a change in strategy from pureinvestment to long-term ownership as an ORIX
business.)
Risk• W e make decisions after drawing up
various scenarios, such as measures toreduce risk or to capture future growth.
Risk• W e do not limit ourselves to a single
investment theme or business, but explore
a broad range of new opportunities so that
we can adapt quickly to changes in ouroperating environment.
Human Resources| 18

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUE

Value Creation Case Studies

MANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Case 1: Renewable Energy Business

ORIX entered the field of renewable energy when it invested in the wind power generation businessin 1995. This new initiative was originally considered an outgrowth of the financing business, andwas not intended to develop into a power plant operation business. The turning point for the
renewable energy business came with the Great East Japan Earthquake in 2011, and the businesshas grown significantly since then.

Generate
project

AssessIdentify changes in customer needs
and markets

Assess profitability and risk

After the Great East Japan Earthquake in2011, we foresaw changes in Japan’s energy
business and power supply mix. We also
recognized that global warming is a serious
problem worldwide.

Deploy human resources,
knowledge, and networks within
the Group for the renewableenergy business.
Secure most human resources from within the Group,
including staff in charge of securing land, as well as
experts in funding and tax and legal issues.

ORIX Sarabetsu-Tokachi Mega-Solar Speedway Power Plant

Wind power generation facility operated by Elawan Energy

Decided to make the renewableenergy power generation
business an area of focus.

Reinforce technical knowledge that was initially lacking
by proactively hiring external experienced personnel.
Invest in wind power generation Basic knowledge of
mechanisms for generating electricity and how
electricity reaches companies and homes.
Real estate business Know-how necessary to build apower plant (land leasing and obtaining government
approvals and licenses).

Previously part of the Business Headquarters,
the Environment and Energy Business
Department was made independent as theInvestment and Operation Headquarters. A
renewable energy specialist team started
with an initial five members.

Project finance
Project launch, fund procurement,
project execution.
Equity investment

Documentation know-how.

C ooperate with sales representatives working at
branches nationwide
Speedily secure land suitable
for mega-solar construction in various locations.

Human resources
Solar power system power purchase agreement (PPA) model
Fuji Logistics Co., Ltd. Mie Logistics Center

Concept image of energy storage plant

Page 73 Environment and Energy

Knowledge

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INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATION

Value Creation Case Studies

CORPORATE GOVERNANCE

EXIT

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Capital, human resources, and expertise in emerging growth business areas

Sales

Additional investment

Finance andinvestIncrease andcreate value

Assess deals

Increase the value of assets

Complete the infrastructure toramp up the renewableenergy business.

In 2014, three years after the start ofthe business, ORIX became aleading solar power generation
operator in Japan.

Feed-in tariff scheme for electricity
started in 2012.

Succeed in establishing a profitable businessmodel at an earlier stage than competitors.

Regular monitoring(Verify strategies and plans)

Ongoing
operation

Invest in growthbusiness areas

Respond flexibly to changes
in the environment

Comprehensive management assessment

Open new markets andgenerate sustainable growth

Impetus for corporations to decarbonize
and reduce CO2 emissions is rising.

Portfolio replacement

Monitor

2021: Sale of entire stake in Bitexco2022: Partial sale of stake in Ormat(¥18.2 billion gain on sale)2023: Additional investment in Elawan Energy
to make it a 100%-owned subsidiaryUse know-how cultivated in Japan toexpand into the renewable energy
business overseas.

Global renewable energy installedcapacity (in operation)
Performance and outlook
By March 2019: 1 GW
By March 2023: 3.7 GW
By March 2025:	6 GW (planned)(7 GW before sale)
By March 2030: 10 GW (target)
Note: Figures are after taking into account ownership
ratios, etc.

Total installed capacity in operation, underconstruction, and under development
Elewan Energy: 11 GW
Greenko:
18 GW

2016: Bitexco (Vietnam)
2017: Ormat (USA, etc.)
2021: Elawan Energy (Spain, etc.),
Greenko (India)

An increase in the number of power plants
in operation revealed the issue of finding the
optimal method for efficiently and stably
operating power plants scattered acrossthe country.
We recognized the necessity of ensuring
the ability to make adjustments to stabilize
the power grid in order to further expand theintroduction of renewable energy.

Promote the introduction of a third-party
ownership model for solar power
generation systems (power purchaseagreement (PPA) model) nationwide.
In 2018, we established ORIX Renewable
Energy Management, which operates,
manages, and maintains power plantsthat use renewable energy such as
solar power.
In 2022, we entered the power storage
station business, which contributes to a morestable power infrastructure by connecting
large storage batteries to the grid.

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INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUE

Value Creation Case Studies

MANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESS

DATA

Case 2: Concession BusinessWith the aging of public infrastructure, the Act on Promotion of Private Finance Initiative (PFI) was
revised in 2011, and a concession system was introduced in Japan in which private businesses takeresponsibility for operation of public facilities and other concerns while leaving their ownership to
public institutions. In 2016, ORIX became Japan’s first privately-owned large-scale airport operator,
leveraging the expertise of its departments in areas including real estate, domestic and overseas
business investment, finance, and credit.

Generate
project

AssessIdentify changes in customer needs
and markets

Assess profitability and risk

2011 revision of Act on Promotionof PFI

Fall 2014 announcement of details of
the public offering process for
Kansai and Osaka (Itami)International airports

A concession system was introduced inJapan, in which private companies takeresponsibility for operation of public facilities
and other concerns while leaving theirownership to public institutions.
At the same time, the Act for Integrated
and Efficient Establishment and Managementof Kansai International Airport and Osaka
International Airport was promulgated.
Kansai International Airport

ORIX INTEGRATED REPORT 2023

Kobe Airport

A real estate team focused on
the concession business.
Multiple teams in the Real Estate Department
were planning and examining new businesses.
One focused on the concession business,
identifying the potential of the Kansai andOsaka (Itami) International Airports Projectin particular, conducting in-depth research
and formulating business plans.

Airport concession business project
team began full-scale operation.
We brought together experts from Group departments inareas including domestic and overseas business
investment, finance, and credit in addition to real estate.
Ultimately, more than 50 people with various know-how
gathered to establish a framework for the project.
We conducted a detailed study of a wide range ofbusinesses both related and unrelated to aviation. At thesame time, we examined in detail improvements insecurity quality and coexistence with local communities
to create the safe, secure environment required ofsocial infrastructure. In addition, we determined thestrong social significance of concessions and their highimportance as a new business.
We also looked for a partner to operate the airports.
Having researched airport operating companies aroundthe world and held repeated meetings, we deepened ourrelationship of trust with VINCI Airports of France andbuilt a partnership. We also obtained investment from 30
companies in Kansai.
Human resources

Nanbuyama Water Treatment Plant (Shiroishi City, Miyagi Prefecture)

Todoroki Stadium (Kawasaki City, Kanagawa Prefecture)

Page 72 Concession

Knowledge

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INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATION

Value Creation Case Studies

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 22

Capital, human resources, and expertise in emerging growth business areas

EXIT
Sales

Additional investment

Finance andinvestIncrease andcreate value

Assess deals

Increase the value of assets

We held numerous internal discussions asultimately the Kansai and Osaka (Itami)International Airports concession businessbecame unprecedented in scale, with anoperating period of over 40 years and a total
consideration of several trillion yen for
operating rights.

Kansai Airports, established by a consortium
centered on ORIX and VINCI Airports ofFrance, began operating Kansai International
Airport and Osaka International Airport (Itami
Airport) in April 2016. In April 2018, it started
operating Kobe Airport through a subsidiary.

Regular monitoring(Verify strategies and plans)

Ongoing
operation

Invest in growthbusiness areas

Respond flexibly to changes
in the environment

Comprehensive management assessment

Open new markets andgenerate sustainable growth

In 2018, it was decided that World
Expo 2025 would be held inOsaka, Japan.

Start of large-scale renovation of
Kansai International Airport

Despite a decline due to the COVID-19
pandemic, the number of passengers at thethree airports recovered to 27.59 million in thefiscal year ended March 2023.
At Kansai International Airport, further
renovations are underway in preparation forthe opening of the new international flightarea in winter 2023 and the grand opening in
spring 2025.

Monitor

Demand for air travel was brisk,
with an increase in the numberof passengers.
FY ended March 2017: 40.82 million
FY ended March 2018: 44.48 million
FY ended March 2019: 48.9 million

As a future growth policy for ORIX, themanagement decision was made to not limit
ourselves to finance, but to move further than
before into businesses with high social
significance and medium to long-term
service and operation businesses.

Note: F igures for the fiscal years ended March 2017 and2018 are for two airports, Kansai International Airport
and Osaka International Airport. The figure for the
fiscal year ended March 2019 is for three airports, withthe addition of Kobe Airport.

We realized that many fields remain where
the quality of services and safety can beraised and profits improved when a privatecompany takes over the operation of tollroads, water supply and sewage systems, andother public facilities, in addition to airports.

We recognized the necessity of
expanding capacity to receive foreign
visitors and improving convenienceand appeal.

In October 2022, the domestic flight area ofTerminal 1 was reopened as the first stage.
The post-security check commercial area
was substantially expanded. An increase in
the number of smart lanes installed at security
checkpoints allows multiple passengers to
use an inspection lane at the same time.

In Hamamatsu City, Shizuoka Prefecture,
we participated in the first domestic
concession-type project* 1 in the watersupply and sewage systems field(operation started in April 2018).
We participated in a water supply, industrial
waterworks, and sewerage project* 2 inMiyagi Prefecture (operation started in
April 2022).
In Kawasaki City, Kanagawa Prefecture,
we participated in the redevelopment,
maintenance and operation of Todoroki
Ryokuchi Park* 3 (operation started in
April 2023).
*1 H amamatsu City Public Wastewater Treatment Plant(Seien Treatment Area) Operation Project*2 M iyagi Prefecture Integrated Water Supply, Industrial
Waterworks and Sewerage Public-Private PartnershipManagement Project*3 Todoroki Ryokuchi Park Redevelopment, Operation, Etc.
ProjectINTRODUCING ORIX

VALUE CREATION STORYCREATING VALUE

Creating Value
This section introduces the value creation that
ORIX targets over the mid- to long-term.

Medium-term Direction24

ESG-related Material Issues and Key Goals

28

Sustainability Promotion and Governance Structure

29

Status of Initiatives to Address ESG-relatedMaterial Issues and Key Goals
Environment

30

Social31

Governance32

Addressing Climate Change

33

1. GHG (CO2) Emissions Reduction

33

2. Promoting the Renewable Energy Business34

3. Information Disclosure Based on TCFD Recommendations

35

Initiatives for Human Rights

36

Sustainable Investing and Lending

36

MANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 24

Medium-term Direction
Results for the Fiscal Year Ended March 2023
In the fiscal year ended March 2023, net income decreased 8.5%
year-over-year to ¥290.3 billion and return on equity (ROE) was 8.5%.
Segment profits decreased 24% year-over-year to ¥406.2 billion. Baseprofits decreased 7% year-over-year to ¥322.8 billion, holding firm
despite an uncertain business environment. Although investment
gains decreased 56% year-over-year to ¥83.5 billion due to theabsence of ¥163.0 billion in gain on the sale of Yayoi Co., Ltd. recordedin the previous fiscal year, ORIX continued its capital recycling
program, which generates around ¥100 billion in investment gains in a
typical year.
Excluding the impact of investment gains from the sale of Yayoi,
segment profits for the fiscal year ended March 2023 increased by¥38.4 billion, or 10% year-over-year. Fiscal year results varied fromsegment to segment. Profits decreased at ORIX USA and the asset

Net Income* and ROE

Investment Gains and Major Components

11.6%

10.3%

10.0%
6.4%

323.7

317.4

302.7

8.5%
290.3

Segment
Real Estate

2018.32020.3

Net income (Billions of yen)2021.32022.32023.3ROE

Other

Breakdown of Segment Profits: Base Profits and Investment Gains

2021.32022.3¥16.9 billion¥21.4 billion¥56.5 billion¥53.6 billion

ORIX Golf Management

ORIX Living¥26.9 billion¥0.3 billion¥16.4 billion

ARRK¥33.7 billion¥37.6 billion-¥0.7 billion¥17.7 billion

Houlihan Lokey¥27.6 billion¥2.3 billion¥6.7 billion¥20.6 billion

RobecoSAM’s ESG Ratings Division¥92.8 billion¥114.2 billion¥54.5 billion

414.5

429.7

92.8

114.2

321.7

315.5

2019.32020.3

Base profits (Billions of yen)

189.0
311.3
54.5

406.2
83.5

-51.5

322.8

2021.32022.32023.3

Investment gains (Billions of yen)

Note: 2023.3 denotes the fiscal year ended March 2023.

¥2.6 billion

Kobayashi Kako

NET JAPAN¥45.9 billion¥33.2 billion¥140.8 billion¥18.2 billion

Yayoi

Ormat (partial stake)¥189.0 billion¥83.5 billion(Billions of yen)

ORIX USA/
ORIX Europe/
Asia and Australia

Yayoi

347.1
256.8

-¥19.1 billion

Segment Profits (From FY ended March 2022 to FY ended March 2023)
536.1

536.1

367.9

PE Investment/
Environment and Energy
Reopening(excluding Insurance)
+42.7

Other
+15.1

+32.1

+¥38.4billion406.2(+10%)
2022.3 (excluding Yayoi sale)¥29.5 billion

RoadSafe

ORIX Electric Power¥119.1 billion

2023.3
Logistics facilities

QRACIAN¥21.6 billion

Total* Net income refers to net income attributable to ORIX Corporation shareholders.

2020.3¥42.9 billion

ORIX USA2019.32019.3Mixed-use property

PE Investment andConcession

192.4

management business of ORIX Europe, among others, due to abruptchanges in the market. Meanwhile, some businesses continued on arecovery track due to reopening following the COVID-19 pandemic.
Growth was apparent in areas of focus for ORIX, including
Environment and Energy, PE Investment in Japan, and others. The
Auto and Real Estate businesses also performed well.

2023.3

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 25

Medium-term Direction

Targets for the Fiscal Year Ending March 2025
The net income target set out in our Medium-term Direction is ¥400.0
billion for the fiscal year ending March 2025. In May 2022, we had originally
set this target at ¥440.0 billion when results for the fiscal year ended March2022 were announced. However, we revised this target downward in May
2023 after considering unstable market conditions. The net income target
for the fiscal year ending March 2024 is ¥330.0 billion. The target for ROE
has been set at 9.0% for the fiscal year ending March 2024 and 10.4% for
the fiscal year ending March 2025.
Profit targets by segment for the fiscal years ending March 2024 and2025 have been divided into four major categories (domestic financial,
domestic non-financial, overseas – ORIX USA and ORIX Europe, andoverseas – other).
Domestic financial profits are expected to grow steadily. In domestic
non-financial businesses, the airport concession business, which includes
Kansai International Airport, is expected to recover from the fiscal year
ending March 2024 to the fiscal year ending March 2025 with the reboundin inbound passengers, and thereafter to steadily contribute to profits on parwith other non-financial businesses.
Profit growth at ORIX USA and ORIX Europe has been forecast
conservatively for the fiscal year ending March 2024 due to global inflationand interest rate hikes, as well as weak performance in some stock markets
in Europe and elsewhere. Nevertheless, we will pursue recovery on a solid
growth trajectory by selectively executing investments based on rigorous
risk management for future growth.
In overseas – other businesses, growth drivers will be the contributions
to profits from the aircraft business due to recovery in passenger demandand from the expansion of the renewable energy business.
The ratio of overseas businesses in segment profits is expected to be
40.8% in the fiscal year ending March 2024 owing to a conservative
estimate of profit contributions from ORIX USA and ORIX Europe. However,in the fiscal year ending March 2025, when a recovery trend is forecast, this2024.3
Forecast¥290.3 billion¥330.0 billion¥400.0 billion

EPS

¥246

¥285

¥351

ROE

8.5%

9.0%

10.4%

Financialsoundness

A rating
equivalent

A rating
equivalent

A rating
equivalentAnnual dividends(per share)¥85.6

Payout ratio
33%

Payout ratio
33%＋

Share buybacks¥50.0 billion¥50.0 billion

To be executed
flexibly

Total return ratio

52%

48%

—

Note: 2023.3 denotes the fiscal year ended March 2023.

• Net income target for the fiscal year ending March 2025: ¥400.0 billion• Continued focus on capital recycling• Continue flexible shareholder returns (share buybacks)• Revisit dividend policy considering the shareholders’ equity ratio and otherfactors, following the termination of shareholder benefit programs in the
FY ending March 2024 and beyond• Maintain financial soundness and search for new investment opportunities

2023.3Financial

Domestic

175.6

43%

2024.3

Increase /Decrease

Forecast

Percentage
of total

14.4

190.0

Corporate Financial Services and Maintenance Leasing

75.0

5.0

80.0

Insurance

63.0

1.0

64.0

Banking and Credit

37.6

8.4

46.0

34.6

100.0

65.4

Real Estate

51.6

0.4

52.0

PE Investment and Concession

2.8

29.2

32.0

Environment and Energy (domestic)

11.0

5.0

16.0

5.3

95.0

6.0

55.0

Europe and the United States

Overseas

ActualPercentage
of total(Billions of yen)Non-financial

2025.3
Target

Net income

Medium-term Direction

Breakdown of Segment Profits (From FY ended March 2023 to FY ending March 2025)

Forecast for FY Ending March 2024 and Target for FY Ending March 2025
2023.3
Actualratio is expected to rise to 44.1%, surpassing the level in the fiscal year
ended March 2023.

89.7

ORIX USA

49.0

ORIX Europe

40.7

Other

75.5

16%

22%

19%

-0.7

40.0

29.5

105.0

Environment and Energy (overseas)

21.9

5.1

27.0

Aircraft and Ships

18.6

11.4

30.0

Asia and Australia

35.0

13.0

48.0

83.8

490.0

(40.7%)(Overseas business ratio)

2025.3

Increase /Decrease

TargetPercentage
of total

39%

10.0

200.0

34%

20%

30.0

130.0

22%

19%

25.0

120.0

20%

21%

35.0

140.0

24%

100.0

590.0

(40.8%)(44.1%)

Segment profits total*

406.2

Pre-tax profit

392.2

82.8

475.0

100.0

575.0

Net income

290.3

39.7

330.0

70.0

400.0

100%

* The difference between segment profits total and pre-tax profit is mainly selling, general and administrative expenses from administrative departments.

100%

Note: Exchange rate USD1=¥130, Euro1=¥140100%

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 26

Medium-term Direction

Capital Recycling
Our basic strategy for ensuring continuous and stable profit growth

the fiscal year ended March 2013, for a compound annual growthbalance between new investments and asset sales. In the fiscal year

while keeping asset size under adequate control is capital recycling.

rate (CAGR) of 10%.

ending March 2024, we are considering exits primarily in Real Estate,

Portfolio replacement is a part of normal business operations at

In the fiscal year ended March 2023, ORIX made new investments

Environment and Energy in Japan and overseas, U.S. businesses and

ORIX, and we will maintain this policy to improve profitability while

totaling ¥470.0 billion (EV basis for private equity), which included the

PE investment in Japan, with an aim of achieving our typical annual

controlling asset size within a cert ain level. We have beenacquisition of shares of DHC Corporation (at an acquisition cost oflevel of around ¥100.0 billion in investment gains.

accelerating capital recycling for efficient and effective capital¥300.0 billion), private equity (PE) investment, and real estate

We have a high level of promising investments in our pipeline, atutilization since the fiscal year ended March 2014. As a result, overall

development. These exceeded asset sales of ¥270.0 billion. Fromaround ¥1.5 trillion (as of May 2023). Although investment opportunities

net income for the fiscal year ended March 2023 was 2.6X that of2024 onward, we plan to manage capital recycling while maintaining a

have increased, we will carefully assess market conditions in pursuit ofCapital Recycling and Profit Growth

Acquisition/
new business

ROBECO

Yayoi
NET JAPAN

RoadSafe
Kansai Airports

Boston Financial

QRACIAN

Houlihan Lokey

Monex

Sale

Ormat

ORIX Electric Power

AvolonGreenkoNXT Capital

Gravis Capital

ORIX Living
ORIX Golf
Management

RobecoSAMQRACIAN

Elawan Energy

DHC

Yayoi

NET JAPAN

RoadSafe

Ormat (partial stake)¥290.3 billion

Net Income

2.6X
CAGR 10%¥111.9 billion

2013.32014.3

Note: 2023.3 denotes the fiscal year ended March 2023.

2015.32016.32017.32018.32019.32020.32021.32022.32023.3

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Medium-term Direction

high returns from taking on genuinely promising new investments while
controlling for risk.

Pipeline (As of May 2023)
TargetOverview

Investment Amount

Domestic PE• IT / information services, healthcare, BPO and logistics• Many deals under consideration, including large-size carve outs like Toshiba and businesssuccession deals (SMEs)¥400.0 billion• Projects under construction were started when costs were lower• New projects to be managed with strict cost controls to maintain high development NOI¥190.0 billion*1• Elawan Energy moving into new markets• Aim to purchase new platform in the United States¥600.0 billion*2

Aircraft• Invest primarily in new, narrow-body aircraft• Aim to increase asset management business deals by timely sales of purchased aircraft¥130.0 billion

Other• Move forward with multiple strategic investments to drive growth in existing businesses¥300.0 billion*3

In domestic PE investment, we are considering investments of all
sizes, including large-scale carve-outs and SME business succession,
mainly in focus areas such as IT / information services and healthcare.
Basically, we will seek investment opportunities involving a holding

Domestic real estate

period between five and seven years and IRR between 15% and 20%.
Efforts in the domestic real estate business will focus on

Overseas renewable energy

development of logistics centers and condominiums with sufficientprofit potential in Tokyo, Osaka, and other metropolitan areas, while
keeping in mind the challenges posed by rising construction costs.
In overseas renewable energy, we will move for ward withinitiatives at Elawan Energy and market research in the United States.
However, in consideration of the current rising interest rate regime
and increasing material prices, we will focus on selected investments
which allow for arbitrage opportunities and present a clear exit strategy.
Our aircraft business covers not just leasing but also purchase,sale, and management of aircraft without involving external agents.
We will promote a capital recycling-based strategy that pursues
aircraft sales in the market alongside purchases and leasing.
In addition, we will make strategic investments to drive growth inexisting businesses. We will continue to consider intriguing
opportunities regardless of the field.
Note: For more details on our finances and shareholder returns, please refer to “Financial Strategy andCapital Policy” on page 38.

*1 Amount includes total project value for logistics centers and rental condominium properties (including those for which payment was complete by FY ended March 2023).
*2 Pipeline figure primarily includes investments at Elawan Energy (wholly consolidated subsidiary) scheduled for execution through 2025, excluding renewable energy investments by Greenko (equity method affiliate).
*3 Excluding MICE-IR scheduled to launch in 2029 or later.

| 27

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

ESG-related Material Issues and Key Goals

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 28

(Set in November 2021)

The ESG-related material issues that will enable ORIX’s sustainable growth are as follows.
We have also set key goals to link these material issues to specific actions.

ESG-related Material Issues

ESG-related Key Goals

1 Material issues and focus areas to reduce climate change-related risks.

1 Outside directors to account for over half of the composition of the

1 Set GHG emissions reduction goals.

ORIX Group Board of Directors by the General Meeting of

2 Continue to lead in renewable energy investment and production.

Shareholders set to be held in June 2023.

3 Quantify and reduce our climate change-related risks and continue to implement TCFD recommendations.
4 Continue to promote a circular economy and reduce and appropriately manage waste.
5 Formulate an exit strategy for existing exposure to high environmental risk business areas and create bright-line exclusion criteria in any new

investing or lending.
6 Work with our stakeholders to promote a healthier environment through goods and services that help mitigate adverse environmental impacts.

2 Female directors to account for over 30% of the composition of

the ORIX Group Board of Directors by the end of the fiscal year
ending March 2030.
3 Female employees to account for over 30% of management

positions at ORIX Group by the end of the fiscal year ending
March 2030.

2 Material issues and focus areas to reduce social risks, including human rights risk.
1 Continue to strengthen our Sustainable Investing and Lending Policy, Code of Conduct, and risk management system to adequately cover new

and emerging social risk areas.
2 Share a common and agreed respect for fundamental human rights with all of our stakeholders such as support for the UN Universal Declarationof Human Rights, worker health and safety, diversity, inclusion and non-discrimination.
3 Continue to improve employee satisfaction by respecting the diversity of our employees and creating an inclusive working environment that

4 Reduce ORIX Group GHG (CO2) emissions by 50% compared to

the fiscal year ended March 2020 by the end of the fiscal year
ending March 2030.
5 ORIX Group to achieve net zero GHG (CO2) emissions by the endof the fiscal year ending March 2050.
6 Reduce ORIX Group’s investment and credit balance in GHG (CO2)

promotes flexible working styles and provides career development support, fair performance review and compensation schemes, and employee

emitting industries* by 50% compared to the fiscal year ended

health support systems.

March 2020 by the end of the fiscal year ending March 2030.
7 O RIX Group to achieve a zero investment and credit balance in

3 Material issues and focus areas to strengthen governance based on transparency, compliance, and integrity.
1 Continue to strengthen the independence of the Board of Directors so that the Board may provide appropriate and effective oversight over the

management’s business execution from an independent and objective perspective.
2 The Group CEO will be responsible for all execution matters including responding to these material issues under the oversight of the Board of

Directors.
3 Emphasis on client satisfaction and developing and offering sustainable products and services.
4 Endeavour to gain and keep the trust of our clients in all of our business areas.
5 Promote a strong culture of compliance with all applicable laws and regulations, including paying our fair share of taxes.

GHG (CO2) emitting industries* by the end of the fiscal year ending
March 2040.
* Refers to fossil fuel mining, palm oil plantations, and forestry financed by ORIX Group overseas
subsidiaries.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 29

Sustainability Promotion and Governance Structure
ORIX has diverse businesses, and each business has a wide range of sustainability issues that either affect society or are affected by society.
For this reason, we divide our approach to sustainability issues into two categories: the corporate (Group-wide) level and the business unit level.

Status of Recent Initiatives
The Sustainability Committee discussed and reported on items 1 and
2 below. Details of the Sustainability Committee meeting were
submitted as a Progress Report on Sustainability Promotion Activities
to the Board of Directors, where it was approved.

1. Group-wide themes
1) Performance report for the fiscal year ended March 2023
(1) Progress toward ESG-related key goals(2) E xpansion of the coverage of scenario analysis based on
TCFD Recommendations(3) C ommencement of preparations for sur veys and risk
assessments on the status of human rights(4) Improvement in ESG ratings and ORIX’s selection as aconstituent in ESG indices adopted by the Government
Pension Investment Fund (GPIF) of Japan
2) Focus themes for the fiscal year ending March 2024
(1) Inculcate sustainability promotion befitting ORIX among
employees (increase job satisfaction, create a better corporate
culture, close the generation gap in sustainability awareness)(2) Share sustainability-related business opportunities recognizedby each business unit Company-wide and use them inbusiness activities(3) Recognize growing concerns about supply chains and humanrights and consider policy revisions that reflect them(4) Expand disclosure of non-financial information
Pages 30-32 Status of Initiatives to Address ESG-relatedMaterial Issues and Key Goals
Page 35 Scenario Analysis Based on TCFD Recommendations

Sustainability Governance Structure
2. Approach to and KPIs for sustainability in each business unit
We have reviewed the progress of the policy and KPIs set at the
beginning of the fiscal year ended March 2023 to establish ourapproach for the fiscal year ending March 2024 and beyond.
Major initiatives for the fiscal year ended March 2023 wereas follows.
•C onsidered calculation and data provision of customers’ CO2 emissions.
Rental car stores improved their green electricity ratio. (Auto)• Started providing products and services that contribute to thecircular economy and climate change mitigation. Started supply
chain management. (Rentec)• R educed CO 2 emissions from owned properties. Eliminatedplastic and reduced food waste in operating businesses. (Real
Estate Investment and Facilities Operation)• Decided to install EV charging outlets as standard equipment inparking lots for condominiums to be developed in the future.
(DAIKYO)• Promoted a material recycling business for blister packaging
sheets and a reuse and recycling business for solar panels.
(Environment and Energy)• Issued our first sustainability bond. (Banking)• Assigned ESG scores to all investing and lending transactions
that are assumed to be self-owned. (ORIX USA)• Formed a stock fund specializing in biodiversity. (ORIX Europe)
Approach of Each Business Unit from the Fiscal Year Ending March2024 Onward.
Pages 66-80 “Approach to Sustainability” section for each business unit
Examples of Sustainability Initiatives in Each Business Unit.
Contributing to Society through Our Business Activities

Sustainability Governance Structure
Board of Directors
ReportApproval

Sustainability Committee
Secretariat: Investor Relations and Sustainability Department

Business UnitsManagement Departments
The Board of Directors supervises and guides sustainability governance.
The Sustainability Committee implements ESG-related material issues and key
goals Group-wide. It formulates strategic approaches, KPIs, and action
protocols, and the results of its deliberations will then be reported to andapproved by the Board of Directors.
Members: G roup CEO (chair), people in charge of segments most directly
related to ESG
Attended by other participants depending on the agenda

Role of the Sustainability Committee
1. Discussion of specific measures to achieve goals
2. Discussion of any conflicts arising between short-term earnings andlong-term growth
3. D iscussion of measures to reduce climate change risk following theTask Force on Climate-related Financial Disclosures (TCFD) framework
4. Sharing of information on Japanese and international developments
in corporate sustainability
5. Discussion of matters to report to the Board of Directors
Approach to Sustainability Issues

INTRODUCING ORIX

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Status of Initiatives to Address ESG-related Material Issues and Key Goals

Environment
Material Issues and Focus Areas to Reduce
Climate Change-related Risks
1 Set GHG emissions reduction goals.
2 Continue to lead in renewable energy investment and production.
3 Quantify and reduce our climate change-related risks and continue

to implement TCFD recommendations.
4 C ontinue to promote a circular economy and reduce andappropriately manage waste.
5 F ormulate an exit strategy for existing exposure to highenvironmental risk business areas and create bright-line exclusion
criteria in any new investing or lending.
6 Work with our stakeholders to promote a healthier environment
through goods and services that help mitigate adverse environmental
impacts.

Key Goals• Reduce ORIX Group GHG (CO2) emissions by 50% compared to thefiscal year ended March 2020 by the end of the fiscal year ending
March 2030.
• ORIX Group to achieve net zero GHG (CO2) emissions by the end of
the fiscal year ending March 2050.
• Reduce ORIX Group’s investment and credit balance in GHG (CO2)emitting industries* by 50% compared to the fiscal year ended
March 2020 by the end of the fiscal year ending March 2030.
•O RIX Group to achieve a zero investment and credit balance in GHG (CO2)emitting industries* by the end of the fiscal year ending March 2040.
* Refers to fossil fuel mining, palm oil plantations, and forestry financed by ORIX Group overseas
subsidiaries.

Status of Initiatives to Address Issues and Goals
1 W ith the aim of reaching our GHG (CO2) emissions reduction goals,

we are considering reducing emissions by switching fuels used at
our two coal-biomass co-fired power plants, which accounted formore than 70% of our emissions in the fiscal year ended March
2020. If it is deemed difficult to achieve the reduction, we willconsider closing the facilities, so we recorded an impairment of¥19.6 billion in the fiscal year ended March 2022. In the fiscal year
ended March 2023, we held discussions on decarbonization,organized the items to be considered into the three points ofequipment conversion, fuel procurement, and renewable energy
demand, and began concrete deliberations.
• Total Scope 1 and 2 GHG (CO2) emissions in the fiscal year ended
March 2023 were 1,121 thousand tons, a reduction of 145
thousand tons (11.4%) compared to the baseline emissions in thefiscal year ended March 2020.
Page 33 GHG (CO2) Emissions Reduction
2 The generation capacity (currently in operation) of our renewableenergy business as of March 31, 2023 is 3.7 GW. We expect toexpand it to 7.0 GW* by March 31, 2025, and our goal is to expand
to 10 GW by March 2030.
* 1.0 GW of which is scheduled to be sold, so ORIX’s holdings will be 6.0 GW.

Page 34 Promoting the Renewable Energy Business3 In November 2021, we began disclosing information in line with

the TCFD information disclosure framework. We are conducting
scenario analyses of our Environment and Energy, Real Estate,Auto, Aircraft and Ships, Finance (Japan, United States, and Asia
and Australia), and Life Insurance businesses. Regarding Scope 3(GHG emissions in the value chain), we have roughly estimated thescale of emissions from the Auto, Aircraft and Ships, and Real
Estate businesses, and the power generation and electric power
retail business in the Environment and Energy segment, as well as

emissions from investees and borrowers (Category 15).
Page 35 Information Disclosure Based on TCFD Recommendations
Page 83 ESG Data (Scope 3)
4 We are promoting a business that supports waste recycling andprocessing, as well as a business that facilitates the reuse,recycling, and proper processing of unwanted goods.
Promoting the Circular Economy and Reducing Waste
5 T hree local subsidiaries in the Asia and Australia segment (inIndonesia, Malaysia, and Australia) aim to reduce their credit
balance in industries that have a high environmental impact. As partof this process, they consider both business and regional
characteristics when ascertaining which borrowers to target, as
well as assessing the possible reduction impact.
• The credit balance (on a local currency basis) to industries with highenvironmental impact as of March 31, 2023 decreased comparedto the fiscal year ended March 2020 for all three local subsidiaries.
6 E ach of our business units strives to provide environmentallyfriendly products and services.
Contributing to Society through Our Business Activities

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Status of Initiatives to Address ESG-related Material Issues and Key Goals

SocialMaterial Issues and Focus Areas to Reduce
Social Risks, Including Human Rights Risk

Status of Initiatives to Address Issues and Goals
1 W e p r o h i b i t i nve s t i n g a n d l e n d i n g i n p r o j e c t s r e l a t e d t o

1 C ontinue to strengthen our Sustainable Investing and Lendingorganizations and sectors / business activities that are social risks.

Policy, Code of Conduct, and risk management system to

We have set a key goal of reducing the balance of investing andadequately cover new and emerging social risk areas.

lending in business areas with high environmental risks.

2 Share a common and agreed respect for fundamental human rights

Page 36 Sustainable Investing and Lending

parties such as clients and suppliers, and we have announced it on
our website.
Page 36 Initiatives for Human Rights
3 We are working to promote the creation of comfortable workplaces

where diverse human resources can play an active role, rewardingwith all of our stakeholders such as support for the UN Universal
2 We have formulated and disclosed a human rights policy that refers

workplaces where they can demonstrate their abilities andto the United Nations’ Universal Declaration of Human Rights, theexpertise, and workplaces where they can continue to work for a

3 C ontinue to improve employee satisfaction by respecting theInternational Labour Organization’s International Labour Standards,

long time in good physical and mental health. We will achieve thisdiversity of our employees and creating an inclusive working

and the United Nations’ Guiding Principles on Business and Human

through the development of various systems that incorporate theenvironment that promotes flexible working styles and provides

Rights, among other documents, and require all parties inside andopinions of employees.

career development support, fair performance review andoutside the Company to respect human rights. Our Sustainable

compensation schemes, and employee health support systems.

Investing and Lending Policy stipulates that human rights risk is a

Declaration of Human Rights, worker health and safety, diversity,
inclusion and non-discrimination.

key factor in investment and credit-related decisions.

Key Goals• Female employees to account for over 30% of management positions
at ORIX Group by the end of the fiscal year ending March 2030.

In 2019, we first analyzed the risk of human rights violations in theGroup by business area. Since 2022, we have been undertaking
human rights due diligence in line with norms such as the UN Guiding
Principles on Business and Human Rights. We conducted desktop
analysis to specify and assess negative impacts in the value chain bybusiness area, business region, and stakeholder, and identified highly
serious issues. We are considering starting a fact-finding survey toaddress items that are assumed to have a high priority.
In addition, the compliance department is discussing specificmeasures to prevent or mitigate the risk of human rights violations.
As a remedy system in the event of human rights violations, wehave set up a compliance hotline for consultation and reporting thatcan be used not only by our own employees but also by external

Page 42 Human Resources Strategy
Human Resources Strategy to Support Sustainable Growth• As of March 31, 2023, the ratio of female managers in ORIX
Group is 29.8% for ORIX Corporation and 25.7% for our 10
domestic Group companies.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 32

Status of Initiatives to Address ESG-related Material Issues and Key Goals

GovernanceMaterial Issues and Focus Areas to Strengthen
Governance Based on Transparency,
Compliance, and Integrity

Status of Initiatives to Address Issues and Goals
1 2 	We have established a sound and highly transparent corporate

3 4 	We carefully ascertain our customers’ intentions, so that they

governance system. We are also taking the following measures

can select the most suitable products and services, and weto strengthen our system:

strive to propose products and ser vices that meet theirso that the Board may provide appropriate and effective oversight• Increase the diversity of directors.

objectives. In order to provide and recommend products andover the management’s business execution from an independent• E valuate the effectiveness of the Board of Directors andservices that are suitable for customers, we strive to acquire

implement an action plan to improve its effectiveness based

excellent work experience, specialized knowledge, and skills ason the evaluation results.

professionals. Each business unit is committed to providing

1 Continue to strengthen the independence of the Board of Directors

and objective perspective.
2 T he Group CEO will be responsible for all execution matters

including responding to these material issues under the oversightof the Board of Directors.
3 E mphasis on client satisfaction and developing and offering

sustainable products and services.
4 Endeavour to gain and keep the trust of our clients in all of ourbusiness areas.
5 Promote a strong culture of compliance with all applicable laws andregulations, including paying our fair share of taxes.

• We have introduced a compensation scheme for executive
officers that evaluates contributions to business performanceas well as medium- to long-term results.
executive compensation, with the aim of encouraging

5 	The Code of Conduct stipulates that ORIX employees must

executives to take the initiative in addressing ORIX Group’s“comply at all times with all applicable laws, rules and regulations

ESG issues.

and ORIX Group policies and rules” and “understand and comply– From the fiscal year ended March 2022, the status of ESG

with tax laws, regulations and ORIX Group policies and rules.”division performance indicator for annual bonuses for
executive officers.

• Outside directors to account for over half of the composition of the– From the fiscal year ending March 2024, ORIX Group’s

ORIX Group Board of Directors by the General Meeting of

progress in achieving ESG-related key goals will be added toShareholders set to be held in June 2023.

quantitative evaluation items for the president, senior• Female directors to account for over 30% of the composition of the
ORIX Group Board of Directors by the end of the fiscal year ending
March 2030.

Proper Consideration of Our Customers
Contributing to Society through Our Business Activities• We have begun reflecting the status of ESG initiatives ininitiatives was added as a qualitative evaluation item for the

Key Goals

sustainable products and services.

managing executive officers, and managing executive officers.
Page 50 Corporate Governance• Since January 2022, the ratio of outside directors has been
54.5% (of all 11 directors, 6 are outside directors).
• As of June 2023, the ratio of female directors is 18.1% (of all
11 directors, 2 are female directors).

Tax Policy

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESS

DATA

Addressing Climate Change

1. GHG (CO2) Emissions Reduction

Addressing Climate Change

GHG (CO2) Emissions Reduction Goals and GHG (CO2) Emissions

Confronting climate change is a key theme that must be addressed ona global scale. Ongoing global warming in the absence of effective
countermeasures will cause drastic climate change that will
significantly impact the global environment. Against this backdrop,
carbon neutral initiatives to reduce greenhouse gas (GHG) emissions
to virtually zero have swiftly been gaining traction worldwide.
ORIX has made addressing climate change one of its material
issues, and has stated its intent to proactively promote the renewableenergy business, reduce GHG emissions in its own businesses, andcomply with the recommendations of the Task Force on Climaterelated Financial Disclosures (TCFD). We have also set the key goalsof reducing ORIX Group GHG (CO2) emissions by 50% compared to
the fiscal year ended March 2020 by the end of the fiscal year ending
March 2030, and achieving net zero emissions by the end of the fiscal
year ending March 2050.
ORIX will continue to proactively respond to the risks andopportunities brought about by climate change through its diverse
businesses. We will also utilize the TCFD information disclosure
framework to strengthen climate change-related governance and risk
management through scenario analysis. Based on such measures, wewill disclose more specific information on ORIX’s climate change
initiatives to our stakeholders.

• GHG (CO2) Emissions Reduction Goals

Information Disclosure Based on
TCFD Recommendations

ORIX Group GHG (CO2) Emissions

ORIX announced its support for the TCFD in October 2020. In
November 2021, we began disclosing information in line with the
TCFD information disclosure framework.
Page 35 Information Disclosure Based on TCFD Recommendations| 33

Energy segment, and investees and borrowers (Category 15).

ORIX has set GHG (CO2) emissions reduction goals as follows:(1) Reduce GHG (CO2) emissions by 50% compared to the fiscal year
ended March 2020 by the end of the fiscal year ending March 2030.
(2) Achieve net zero GHG (CO2) emissions by the end of the fiscal year
ending March 2050.
ORIX Group GHG (CO2) Emissions (Baseline Emissions) in the
Fiscal Year Ended March 2020
(Unit: Thousand tons CO2e)
Emissions(Scope 1)(Scope 2)

Environment and Energy Segment

1,089

1,069

  20

– Two coal-biomass co-fired power plants   941   9391

Real Estate Segment

   85

   19

  66

Total of other segments

   93

   18

  74

Total

1,266

1,107

158

See here for details on ORIX Group GHG (CO2) emissions (baseline
emissions) in the fiscal year ended March 2020.

• GHG (CO2) Emissions
Total Scope 1 and Scope 2 emissions in the fiscal year ended March2023 were 1,121 thousand tons. Compared to the baseline emissions,this was a decrease of 145 thousand tons. Emissions from the twocoal-biomass co-fired power plants amounted to 793 thousand tons,
accounting for 70.7% of the total.
(Unit: Thousand tons CO2e)

FY ended March 2020
(Baseline Emissions)

FY ended March 2023

Scope 1

1,107   982

Scope 2   158   140

Total

1,266

1,121

Page 82 ESG Data

ORIX INTEGRATED REPORT 2023

Environmental Performance Data

We have roughly estimated the scale of Scope 3 emissions (GHG
emissions in the value chain) for the following businesses:
Emissions from Auto, Aircraft and Ships, Real Estate, the power
generation and electric power retail business in the Environment andPage 83 ESG Data

Initiatives to Reduce Emissions• Environment and Energy Segment: Coal-biomass Co-fired
Power Plants*1
Aiming for a 50% reduction in emissions by the end of the fiscal year
ending March 2030, we are considering measures including refitting
equipment to move to pure biomass combustion and switching to nextgeneration fuels such as hydrogen and ammonia. If it is deemed difficult
to achieve the reduction, we will consider closing the facilities, so werecorded an impairment of ¥19.6 billion in the fiscal year ended March
2022. In the fiscal year ended March 2023, we held discussions on
decarbonization, organized the items to be considered into the threepoints of equipment conversion, fuel procurement, and renewableenergy demand, and began concrete consideration.
*1 Soma Coal-Biomass Power Plant (Soma City, Fukushima Prefecture, started operation in March 2018,with generation capacity of 112 MW), Hibikinada Coal-Biomass Power Plant (Kitakyushu City, Fukuoka
Prefecture, started operation in December 2018, with generation capacity of 112 MW).

• Real Estate Segment
We have formulated a plan to make gradual reductions toward a 50%
emissions reduction goal by the fiscal year ending March 2030. Our
main reduction initiatives are as follows:(1) M ake equipment upgrades ahead of schedule at properties weown or operate, and introduce energy-saving equipment, etc.*2(2) Adopt renewable energy at properties we own or operate*3(3) U se non-fossil certified renewable energy*4 and purchase J-credits*5
In the fiscal year ended March 2023, we achieved the target
amount of reduction. Emissions are expected to increase in the fiscal
year ending March 2024 due to an increase in the operation ofoperating facilities, and we will work toward a gradual reduction byconserving energy and introducing power from renewable energy.
*2 For properties where we have the authority to renovate facilities.
*3 Install solar panels in logistics facilities developed by ORIX Real Estate, and use renewable energy inthose facilities, but if surplus power is generated, supply the environmental value of surplus power toother properties such as office buildings and lodging facilities.
*4 Appropriate for emissions based on electricity usage, which is difficult to reduce in (1) and (2) above.
*5 Appropriate for emissions based on usage other than electricity.

INTRODUCING ORIX

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2. Promoting the Renewable Energy BusinessInitiatives for Renewable Energy through Our
Power Generation Business

Global Expansion of Renewable Energy Business (As of March 31, 2023)
Spain and other locations

China

ORIX operates power generation businesses around the world as a global• Elawan Energy (100%)• Beijing Energy (4.8%)

renewable energy company. As of March 31, 2023, our generation capacity

Wind/solar

Solar/hydroCapacity: 1,360 MW

Capacity: 5,890 MWof power plants in operation around the world, including Japan, was 3.7

Japan

United States and other locations

Solar• Ormat Technologies (11.2%)

Capacity: 920 MW*3

Geothermal and other capacity: 1,360 MW
Storage battery capacity: 90 MW

Wind/geothermal/biomass
Capacity: 30 MW

GW* . Elawan Energy (100% share) and Greenko (approx. 20% share) lead
1

• ORIX Corporation USA (100%)
Solar capacity: 230 MW

business growth, with Elawan Energy having 11 GW*2 and Greenko having
18 GW*2 in total generation capacity in operation, under construction, or indevelopment. As of March 2025, we expect to expand the generation
capacity of power plants in operation to 6 GW* 1 (7 GW* 1 before
considering sale). Our goal is to expand to 10 GW*1 by March 2030.
Also, in Japan, we are promoting broader adoption of renewableenergy through our business of operation, management, andmaintenance of power plants that use renewable energy, the energy
storage plant business, and the introduction of a third-party ownershipmodel for solar power generation systems.
Renewable Energy Business Generation Capacity (In Operation)*1
10 GW

6 GW
(7 GW before sale)

India• Greenko (20.2%)
Wind/solar/hydroCapacity: 7,180 MW– The generation capacities for each entity are gross figures.
– Figures in parentheses are ORIX’s ownership ratios.

*3 Our solar business in Japan has cumulatively sold more than 1 GW
in panels, in addition to owned capacity. We have a strong networkof customers committed to renewable energy.

CO2 Avoided Emissions
approximately 4.7 million tons for the fiscal year ended March 2023. The
year-over-year increase was approximately 0.4 million tons. This was

1 GW

mainly due to both an increase in power generation and the start ofOverseasJapan2023.3(Unit: Thousand tons CO2)

CO2 avoided emissions at our renewable energy businesses totaled

3.7 GW

2019.3CO2 Avoided Emissions through the Renewable Energy Business2025.3(Planned)

2030.3(Target)*1 Net figures that take into account the Company’s ownership ratio. If the individual project is a joint
venture, we also consider the investment ratio.
*2 Gross figures before taking into account the Company’s ownership ratio.
Note: 2023.3 denotes the fiscal year ended March 2023.

Environment and Energy

Wind
Power

Solar
Power

Geothermal
Power

Hydro
Power

Biomass

Total

India

1,163

   615

  0

392

  0

2,170

Japan

    0

   452

  0

  0

198

   650U.S.A.

   301

   31

289

  0

  0

   621

operations of new renewable energy power plants at Elawan Energy, as

China

   39

   114

  0

  0

  0

   153well as an increase in ORIX’s ownership ratio in the firm in the fiscal

Others   651   213

189

14

  0

1,067

year ended March 2023.

Total

2,155

1,425

477

406

198

4,661

Breakdown by country, region, and generation type is as shown inthe chart on the right.

Page 83 ESG Data

Environmental Performance DataINTRODUCING ORIX

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STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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3. Information Disclosure Based on TCFD Recommendations
Information Disclosure Framework / Governance, Strategy, Risk Management, and Metrics and Goals
We disclose climate change-related information in line with the four TCFD pillars, as follows:

Governance

Strategy

Risk Management

Board Oversight of Climate-related Risks and Opportunities

Climate-related Risks and Opportunities the Organization Has Identified

The Investor Relations and Sustainability Department has started

The Board of Directors provides leadership and guidance for ORIX

Climate-related risks and opportunities include physical risks anddiscussions with departments that handle risk management on

Group’s sustainability. It oversees climate-related risks and opportunities

opportunities brought about by the increase in natural disasters

establishing a climate-related risk management framework.

and determines ESG-related material issues and key goals

associated with climate change. They also include transition risks andAt a meeting in 2023, the Board of Directors heard performance
reports for the fiscal year ended March 2023 in the following areas.
(1) Progress toward ESG-related key goals(2) Expansion of the coverage of scenario analysis based on TCFD
recommendations
Execution Framework for Assessing and Managing Climate-opportunities associated with the transition to a decarbonized society

Metrics and Goals

resulting from more stringent climate-related regulations and changes

Metrics and Goals Used to Assess and Manage Relevant Climate-in corporate and consumer preferences.

related Risks and Opportunities

We expect the following will materially impact ORIX Group:• Physical Risks and Opportunities

ending March 2030 compared to the fiscal year ended March 2020.

suspension and preventive measures or repairs for damage to operating• Reduce ORIX Group GHG (CO2) emissions to net zero by the fiscal

facilities and offices, higher operating and construction expenses

The Group CEO chairs the Sustainability Committee. Committee

resulting from higher temperatures, higher credit costs from damage toto ESG, and other participants will attend as needed so the committee
can flexibly accommodate an evolving agenda.

customers, and loss of asset value from damage to investees.
• Transition Risks and Opportunities
ORIX is exposed to transition risks including business suspension,

The committee will also call on external experts as necessary.

loss of asset value, stranded assets due to more stringent regulations,

The Sustainability Committee discusses specific measures tohigher costs associated with carbon emissions, higher credit costs

achieve goals as well as conflicts arising between short-term earnings

due to deterioration in customer performance, and decreased

and long-term growth. It also holds discussions on measures tocorporate value of high GHG-emission investees. Associatedreduce climate change risk based on TCFD recommendations, share

opportunities include increasing demand for renewable energy.

information on developments in Japan and internationally that are
relevant to sustainability, and discuss matters to report to the Board

Scenario Analysis

of Directors.

We updated our scenario analysis in line with the update to the
Page 29 Sustainability Promotion and Governance Structure• Reduce ORIX Group GHG (CO2) emissions by 50% by the fiscal year

ORIX is exposed to physical risks including higher costs due to business
related Risks and Opportunities
members include people in charge of segments most directly related

ORIX identified the following four key goals related to climate:reference scenarios.
See here for scenario analysis assumptions and analysis results.

year ending March 2050.
• Reduce investment in and lending to industries* that emit GHG (CO2)by 50% by the fiscal year ending March 2030 compared to the fiscal
year ended March 2020.
• Reduce investment in and lending to industries* that emit GHG (CO2)to zero by the fiscal year ending March 2040.
* Refers to fossil fuel mining, palm oil plantations, and forestry financed by ORIX Group overseas
subsidiaries.

Page 33 GHG (CO2) Emissions Reduction

Scope 1, 2 and 3 GHG Emissions
Pages 82-83 ESG Data
ORIX Group companies Robeco and ORIX Asset Management also
disclose information as per TCFD recommendations. Please refer totheir respective reports for further details:
Robeco
ORIX Asset Management

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Initiatives for Human Rights

Sustainable Investing and Lending

Policies and Principles

Policies and Principles

Core Principle of Our Sustainability: Respect human and labor rights

ORIX recognizes that sustainability matters, which involve environmental, social, and governance themes,
may have material impacts on the organization’s long-term risks and opportunities, and that considering
sustainability in decision-making is an extremely important and essential requirement for doing business. We
believe that incorporating sustainability requirements into the consideration of investing and lending initiatives
helps us better understand the risks and opportunities associated with our businesses and initiatives,
resulting in benefits for our customers and shareholders.
ORIX formulated its ORIX Sustainable Investing and Lending Policy in September 2019 with the mission of
implementing sustainable investing and lending. Based on this policy, potential investing and lendingtransactions submitted to the Investment and Credit Committee (“ICC”)*1 go through screening from an ESG
perspective using the Sustainable Investing and Lending Checklist. The ICC decides whether to green lightthe project after thorough consideration regarding the environmental and social effects of each individualtransaction, and may disallow a matter if it determines that the involved counterparty poses environmental orsocial risks.

ORIX recognizes that it has a social responsibility to fulfill in its business activities as a corporation, and that respectfor human rights is essential as part of that responsibility. The ORIX Group Sustainability Policy states “Respecthuman and labor rights” as one of our core principles that should be implemented in all aspects of our business.

Respect human and labor rights
We uphold human and labor rights as defined in international standards such as the Universal
Declaration of Human Rights and the International Labour Organization’s Declaration on
Fundamental Principles and Rights at Work.

Our Approach to Human Rights: Human Rights Policy
In September 2019, we established the ORIX Human Rights Policy as concrete action guidelines for respecting
human rights. It expresses our commitment to promoting initiatives to respect human rights within the Groupand to requesting that our clients and suppliers conduct business activities that respect human rights.
ORIX Human Rights Policy*1 The Investment and Credit Committee is an executive body composed of senior managers and executive officers responsible for investment and lending. The
committee discusses transaction proposals that exceed specified amounts.

ORIX Sustainable Investing and Lending Policy

Our Response to the UK Modern Slavery Act 2015
ORIX annually renews and discloses its Modern Slavery Act Statement based on the UK Modern Slavery Act 2015.
Response to the United Kingdom’s Modern Slavery Act 2015

Issues/Goals/Initiatives
Material Issues

Issues/Initiatives
Material Issues• Share a common and agreed respect for fundamental human rights with all of our stakeholders such assupport for the UN Universal Declaration of Human Rights, worker health and safety, diversity, inclusion,and non-discrimination.

Initiatives•S ince 2022, we have been undertaking human rights due diligence with reference to international norms suchas the UN Guiding Principles on Business and Human Rights. We conducted desktop analysis to specify andassess negative impacts on human rights, and identified highly serious issues. We are considering starting afact-finding survey to address items that are assumed to have a high priority. In addition, the compliancedepartment is discussing specific measures to prevent or mitigate the risk of human rights violations.
• As a remedy system in the event of human rights violations, we have set up a hotline for consultation andreporting that can be used not only by our own employees but also by external parties such as clients andsuppliers, and we have announced it on our website.
Our Efforts to Achieve Respect for Human Rights• C ontinue to strengthen our Sustainable Investing and Lending Policy, Code of Conduct, and risk
management system to adequately cover new and emerging social risk areas.
• Formulate an exit strategy for existing exposure to high environmental risk business areas and create brightline exclusion criteria in any new investing or lending.

Key Goals• For investment and credit balance in GHG (CO 2) emitting industries*2, (1) reduce the balance by 50%
compared to the fiscal year ended March 2020 by the end of the fiscal year ending March 2030, and (2)achieve a zero balance by the end of the fiscal year ending March 2040.
*2 Refers to fossil fuel mining, palm oil plantations, and forestry financed by ORIX Group overseas subsidiaries.

Initiatives• See here for initiatives to promote sustainable investing and lending.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONManagement Foundationthat Supports
Sustainable GrowthThis section introduces ORIX’s management foundationthat supports medium- and long-term value creation.

Financial Strategy and Capital Policy

38

Human Resources Strategy

42

Risk Management

46

Promoting a Digital Transformation

49

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

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Financial Strategy and Capital Policy
Management Conscious of Cost of Capital and Share Price

Hitomaro Yano
Executive Officer
Corporate Function Unit
Responsible for Treasury, Accounting, Corporate Planning,
Investor Relations and Sustainability
ProfileJoined ORIX in June 1989. Became Executive Officer, Corporate Function Unit
Responsible for Treasury, Accounting, Corporate Planning, Investor Relations, andSustainability in January 2023, following posts including General Manager ofTreasury Department, Deputy Head of Treasury and Accounting Headquarters andHead of Treasury and Accounting Headquarters.

On March 31, 2023, the Tokyo Stock Exchange declared that
corporations with a price book-value ratio (PBR) below 1.0 may haveissues with market recognition of their capital profitability and potential
for sustainable growth. To this end, it requested all listed corporations
to analyze their current situation, devise initiatives, and engage indialogue with shareholders. Since ORIX’s PBR is currently below 1.0,
we will begin by aiming to achieve that level, then follow up withfurther improvement. We therefore consider it essential to improve
ROE and to help shareholders and investors further deepen theirunderstanding of ORIX through improved disclosure and dialogue.
An analysis of historical data indicates a clear correlation between
ROE and PBR, so we can expect improvement in ROE to lead to anincrease in share price and recovery in PBR. Sustainable profit growthis of the utmost importance for this purpose. Concurrently, we will
improve ROE by controlling the size of shareholders’ equity at an

appropriate level—in other words, by optimizing the balance between
investment and shareholder returns while considering capital
adequacy to achieve the most efficient use of capital.
We will also continue working to improve information disclosurefor investors, with an emphasis on clarit y. For example, ourpresentation materials for the fiscal year ended March 2023
streamlined our profit targets up to the fiscal year ending March 2025
by reclassifying ORIX Group’s 10 segments into four categories,
dividing domestic business into financial and non-financial categories,
and overseas business into ORIX USA / ORIX Europe and other. We
also presented our main new investments and exits from existing
investments in the fiscal year ended March 2023, along with examples
from the past 10 years, in an effort to deepen investor understandingof our capital recycling by enabling them to verify our long-term trackrecord in this area.

ROE, EPS, and PBR
(%)
14.0

(Times)1.2

ROE: 10.4% average (2014.3 - 2023.3)

12.0

1.0

10.0

10.4%

0.72 times
8.0

8.5%

9.0%

¥351

0.8

0.6

¥285

6.0

¥246

0.4

4.0
2.0

0.2

¥103

0.0

0

2013.32014.3

ROE (left scale)

EPS

2015.3

PBR (right scale)Note: 2023.3 denotes the fiscal year ended March 2023.

2016.32017.32018.32019.32020.32021.32022.32023.32024.3(Forecast)

2025.3(Target)INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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Financial Strategy and Capital Policy

Communication with Institutional Investors

Control of Capital and Debt

We are working proactively to expand opportunities for dialogue withshareholders and investors in Japan and overseas. Our investor
relations (IR) activities are spearheaded by the Group CEO andconducted primarily by the officer and department responsible for IR.
Our two offices in Tokyo and New York held more than 500 investor
meetings during the fiscal year ended March 2023. The CEO
personally conducts presentations at semiannual financial results
briefings, and we are increasing opportunities for face-to-facemeetings with major institutional investors both in Japan and abroad.
Recently, an increasing number of inquiries and requests frominvestors concern our individual businesses and their management. In
response, we intend to enhance thematic explanations of eachbusiness. We are also aware of investors’ great interest in the detailsof discussions on corporate governance and succession at the Boardof Directors and other internal meetings that include outside directors,
and believe such information should be made available as well.

As I m e n t i o n e d p r ev i o u s l y, we wa n t t o c o n t r o l t h e s i ze o fshareholders’ equity at an appropriate level, and to so do, we believe
it is essential to deliver shareholder returns while maintaining financial
soundness to enjoy the benefit of low cost funding. We will therefore
seek and maintain an optimal level of leverage. ORIX has been
continuously lowering its leverage ratio amid the global trend toward
lower interest rates spurred by the 2008 financial crisis. This isbecause the business model of capitalizing on interest rate spread has
become less profitable, forcing us to expand and shift our businessdomain from financing to operating and investment, heightening theneed for us to ensure a shareholders’ equity ratio commensurate withthe risks inherent in our operating assets and types of business.
A lower leverage ratio is not necessarily better. To continue toachieve 11% ROE after we reach the 10.4% ROE target for the fiscal
year ending March 2025, it is essential for us to keep engaging inhighly profitable businesses while using shareholders’ equity
efficiently. We must control leverage at an appropriate level by being
conscious of the cost of capital while maintaining financial soundness.
For example, ORIX independently measures the amount of risk (risk
capital) in its assets and businesses, and calculates the employed
capital ratio as the ratio of risk capital against shareholders’ equity.

Number of Events Held per YearROE and Debt/Equity Ratio (excluding Deposits)

Risk Capital, Shareholders’ Equity, and Employed Capital Ratio*(FY ended March 2023)
One-on-one meetings
with institutional
investors
Briefings for analysts
and institutional
investors
Overseas road-shows(on-site)

Approx.
500

88%

4.5
10.5%

3.8

11.5%

11.7%

Briefings forindividual investors

12.1%

5.1%

5

88%

85%

91%
86%

11.6%
10.3%

10.4%

10.0%
8.5%

7.4%

3.4

9.0%

3.0

2.9
2.5

2.5

2019.32020.3

2.7

3.0

3.3

3.2

3.5

2.8

6.2%
2.7

2.2

3.0%

2.1

6.4%
1.9

1.7%

Securities companysponsored conferences

11.3%

3.4

4
(quarterly)This ratio has been constantly trending at around 90% for the past
five years, reflecting sale of assets and accumulation of internal
capital reserves, though it may temporarily rise due to the executionof a large-scale investment. We are committed to investment withsuperior return on capital while ensuring shareholders’ equity at an
adequate level vis-à-vis risk capital.
To reflect this approach to cost of capital in building its portfolio,
ORIX is quantifying profitability by comparing return on invested
capital (ROIC) with weighted-average cost of capital (WACC)
calculated based on the capital structure required in each business
unit. We require higher ROIC and thus a higher level of WACC in abusiness unit with a higher shareholders’ equity ratio, such as those
involved in investment. We use ROIC and WACC as one of ourapproaches to business administration, and the Board of Directors is
considering measures to improve the business portfolio utilizing ROIC
spread (difference between ROIC and WACC). Use of the ROIC spread
involves consideration of mid- to long-term growth based on an
outlook over multiple years, as single-year profit may fluctuate
depending on the characteristics of the business. For business units
with a negative ROIC spread, we will consider future business plans
and the prospect of improvement in profitability.

1.7

1.5

1.6

1.5

1.6

2018.32019.32020.32021.3

1.5

1.6

10
2009.3 2010.3

1

ROE

2011.32012.32013.32014.3

Debt / Equity ratio (Times)

Note: 2023.3 denotes the fiscal year ended March 2023.

2015.3 2016.3

2017.32022.3 2023.3 2024.3 2025.3(Forecast) (Target)

Risk capital (Trillions of yen)2021.32022.3

Shareholders’ equity (Trillions of yen)2023.3

Employed capital ratio* Employed capital ratio is the ratio of risk capital to shareholders’ equity. ORIX calculates risk capital
based on historical maximum decrease for all assets.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 40

Financial Strategy and Capital Policy

Shareholder Returns

Credit Ratings

Based on the approach described above, ORIX’s Board of Directors

greater than the previous fiscal year’s dividend for each of the past 12

One source of ORIX Group’s competitiveness is its ability to raiseestablished our fundamental policy for shareholder returns, which isfiscal years, and we are determined to deliver still higher dividends

funds stably at low interest rates, and we remain conscious of

to allocate one-third of net income to dividends, one-third to newcommensurate with our mid- to long-term profit growth by maintaining

external credit ratings and evaluation by financial institutions toinvestments, and the rest to capital reserves or other flexible forms ofa 33% payout ratio.

maintain financial soundness. That said, our view of financial

shareholder returns. We view dividends as st able, ongoing

Each fiscal year, we will allocate a certain portion of profit tosoundness may differ from that of rating agencies, which emphasize

shareholder returns. The Medium-term Direction designates a payout

internal capital reserves to make new investments for sustainableaccountability based on rigorous application of rating criteria andratio of 33% or a dividend in the same amount as the previous fiscal

growth. While ORIX has a healthy investment appetite with abundantcomparison with industry peers in assigning ratings. This discrepancy

year, whichever is higher, for the fiscal year ending March 2024, andopportunities in the pipeline, we are very cautious in making final

may at times leads to actions involving our credit rating, especially

33% or higher for the fiscal year ending March 2025. Just how muchdecisions on any investments. Depending on the market environment,

where a large-scale investment is involved. We believe we should

higher than 33% the payout ratio will be in the fiscal year ending

we may sometimes hold off on investments for a while, in which caseavoid management decisions that miss out on a good investment

March 2025 will be considered going for ward, but I expect it to

we will flexibly implement shareholder returns through share buybacks

opportunity because of excessive concern for maintaining current

demonstrate our stance of focusing more on dividends, due in part torather than accumulating surplus funds. We currently conduct sharecredit ratings. We will avail ourselves of investment opportunities wethe scheduled termination of our shareholder benefit program at thebuybacks regularly, and this stance will continue in the future.

consider to be good risks based on our own careful analysis, and workend of March 2024. ORIX has paid dividends that were equal to or
Dividends per Share and Payout Ratio

to ensure solid financial soundness even if our views differ from the

50%

13% 12% 13%

8

9

13

16%

20%

27%
23% 25%40%
13% 11% 14% 16%

23

36

46

52

66

76

78

Note: 2023.3 denotes the fiscal year ended March 2023.

30%

29%
39.1

exchange opinions. Through this dialogue, we strive to help them

47%

48% 52% 48%

45.7 54.3

50.0 50.0

9.7

15.9 30.1

47.2

84.6
60.0 68.3

adopt their suggestions if we consider them effective for maintaining
maintaining financial soundness.

97.4

96.4

96.1 102.7 100.8

Credit Ratings (As of June 2023)
50.0

2011.3 2012.3 2013.3 2014.3 2015.3 2016.3 2017.3 2018.3 2019.3 2020.3 2021.3 2022.3 2023.3 2024.3(Forecast)

Total dividends (Billions of yen)
Total shareholder return ratio

understand ORIX’s management and its future direction. We alsofinancial soundness, thereby achieving sustainable growth while

10.9

8.6

Payout ratio

20% 23%85.6 85.6

2011.3 2012.3 2013.3 2014.3 2015.3 2016.3 2017.3 2018.3 2019.3 2020.3 2021.3 2022.3 2023.3 2024.3 2025.3(Forecast) (Target)

Annual dividends (Yen)hold regular meetings with representatives of rating agencies to78%
33% 35% 33% 33%+

30% 32%76

criteria and analytical methods adopted by rating agencies. We also

Share Buybacks and Total Shareholder Return Ratio

Actual share buybacks (Billions of yen)

Rating Agency

Credit Rating

S&P

A− (Watch Nagative)

Moody’sA3 (Stable)

Fitch

A− (Stable)

R&I

AA− (Stable)

JCR

AA (Stable)

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 41

Financial Strategy and Capital Policy

Asset-Liability Management (ALM)

Conclusion

Since the assets and liabilities ORIX holds involve inherent risks fromsame currency as our operating assets and our overseas investments

ORIX will continue capital recycling and maintain its policy of

exposure to the impact of interest rates, exchange rates and otherdenominated in foreign currencies.

emphasizing profitability while controlling asset size. Promisingfinancial market trends, we have established internal regulations

Another critical aspect of ALM is dealing with liquidity risk. We

opportunities in the pipeline alone amount to around ¥1.5 trillion (as ofconcerning ALM to monitor these risks from multiple perspectives.

manage liquidity to ensure uninterrupted cash flows along with the

May 2023). We expect renewable energy, private equity investment,

For example, for interest rate fluctuation risk, we start by measuring

ability to repay debt even in the face of emergencies such as a

asset management, and aircraft-related investment to drive growth as

the assumed risk amount for each currency against the allowable risk

financial crisis. For liabilities, we control liquidity on hand at an

we work toward our net income target for the fiscal year ending

amount set at the beginning of the period, then determine theoptimum level within a necessary and sufficient range by extending

March 2025. As we accumulate these investment assets, we willsensitivity of assets and liabilities and the amount of impact on

the funding period or staggering the redemption period to avoid

proactively sell businesses and assets in response to market

financial condition when interest rates fluctuate. Through these andconcentration of maturities within a narrow timeframe. We strive to

conditions. In line with such asset side activities, we will use a variety

other types of monitoring, we determine future debt financing policies

keep liquidity on hand at an appropriate level by conducting regularof financing methods on the funding side including domestic andand implement risk hedging using derivatives as necessary. As astress tests based on a hypothetical financial crisis.

overseas capital markets, borrowings from financial institutions,general rule, we hedge foreign exchange risks by raising funds in the

project finance, and asset securitization. We consider agile financial
management in response to constantly changing market trends to bea key role of our treasury department.

Interest Rate and Forex Sensitivity

Interest rate sensitivity*1• Japanese yen, US dollar: Negligible• Euro: -¥2 to -¥3 billion

Funding Structure and Long-term Debt Ratio*93%• +¥1.5 billion*1 Sensitivity of pre-tax profits assuming a 1% increase in interest rates lasting for 12 months.
*2 Sensitivity of pre-tax profits assuming ¥1 depreciation lasting for 12 months.

93%

91%

6.8

7.0

7.1

2.2

2.3

2.3

91%

703%
603%

8.0
6.4

Forex sensitivity*2

93%

Liquidity on Hand

1.9

536%

2.2
1.5

1.2

1.2

1.2

1.2

3.3

3.4

3.5

3.6

4.2

346.6

427.6

561.0

549.2

2019.32020.32021.32022.32023.3* Excluding deposits.
Note: 2023.3 denotes the fiscal year ended March 2023.

2019.3182.4

1,111.3

524.5

507.2

627.1

604.1

2020.3190.9
2021.3568%
1,417.1

1,151.5
976.7

907.6

129.1

Deposits (Trillions of yen)
Capital markets (Trillions of yen)
Borrowings from financial institutions (Trillions of yen)
Long-term debt ratio

526%

518.6

898.6
211.4

2022.3249.62023.3

Unused commitment lines (Billions of yen)
Cash and cash equivalents (Billions of yen)
Marketable short-term debt*1 (Billions of yen)
Liquidity-on-hand coverage ratio*2*1 Total amount of current portion of bonds, MTN and CP balance.
*2 Liquidity on hand (Unused commitment lines + Cash and cash equivalents) / Marketable short-term debt.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Human Resources Strategy
ORIX’s Human Resources Strategy

ProfileJoined ORIX Asset Management & Loan Services in May 2002, and ORIX in October
2005. Previously worked at Mitsui Trust and Banking Company (currently Sumitomo
Mitsui Trust Bank). Engaged in legal affairs at ORIX Asset Management & Loan Services,
and in the formation of regional revitalization funds and various business investment
projects at ORIX. In 2023, became Executive Officer Responsible for Human Resources,
Corporate Administration and Corporate Communications in the Corporate Function Unit.

ORIX was established as a leasing company in 1964, and has expanded its business into a series of neighboring fields.
The leasing business requires expertise in two areas: financing and tangibles (properties). Our expertise infinancing that started with leasing has now broadened to lending, business investment, life insurance, banking, andasset management, while our expertise in tangibles has expanded from ships, aircraft, industrial / ICT equipment,
automobiles, and real estate to the loan servicing, environment and energy, and concession businesses. In addition,
since we initiated overseas operations in Hong Kong in 1971, we have expanded our international presence to 28
countries and regions as of March 2023.
This growth has been shored up by ORIX’s human resources. However, expanding business fields and creating
new value cannot necessarily be achieved with existing human resources and expertise alone. In addition to accepting
diverse employees regardless of nationality, age, gender, or work history, and creating a working environment where
everyone can play an active role, we need a corporate culture that organically connects the expertise of new
employees with existing expertise to take on challenges in new fields. At ORIX, we refer to the former as “KeepMixed” and the latter as our “Fusion of Intelligence.” These are values that have arisen spontaneously within ORIX as
its corporate culture that has been handed down uninterrupted since the founding of ORIX.
Business growth and human resource development are intimately linked as the two wheels of a chariot. The morea business grows and expands, the more diverse and deeper the expertise of its employees becomes. ORIX has
therefore focused on building a foundation for its human resources so it can flexibly shift its human resource portfolio
without slowing business development. In addition to our focus areas of private equity investment, environment andenergy, and asset management, we are also developing specialists in the field of governance that supports global
expansion, the promotion of digitalization, and the field of IT and information security, as well securing external talent.
Looking ahead to medium- and long-term business development, we will develop employees who can use theirfamiliarity with our existing fields to go the extra step in adding value, and secure talent who can immediately put theirexpertise to work in new fields. By synergizing these two approaches, we aim to achieve sustainable growth.

Business Strategy

Executive Officer
Corporate Function Unit
Responsible for Human Resources,
Corporate Administration and Corporate Communications
Responsible for Secretariat of the Board of Directors

Banking

Asset Management
Lending

Life Insurance

Investment

Diversification of humanresources expertise

Leasing
Ships

Aircraft

Loan Servicing
Real Estate

Automobiles

Concession

Environment and Energy

Relationship ofconstant collaborationand mutual influence
Improve Engagement

Personnel Strategy

Tomohiko Ishihara

Ongoing expansion
into neighboring fields

Promote DE&I

Invest in competitive talent

Respect diversity andprovide opportunities
and a working environmentthat allow individuals
to fully display their abilities
and expertise• Human resources development
focused on core areas• Provide diverse career paths andsupport career independence• Fair performance review andcompensation schemes

Pass down
our corporate
cultureKeep Mixed
Fusion ofIntelligence

Diverse human resources
Age

Nationality

GenderWorkhistory

Create a rewarding
workplace• Work Style Reform Project(since March 2017)• Implement flexible working styles• Achieve and promote well-being| 42

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Human Resources Strategy

Strengths of ORIX’s Human Resources
Corporate Culture and the Working Environment
That Supports It

Case Study 1: Environment and Energy

Case Study 2: Concession

Around 2013, when ORIX began a full-scale rollout of its solar power

When the concession model was introduced to Japan, ORIX took on

generation business in Japan, it made full use of the project-building

the challenge of this new business by combining the sharedcapabilities, documentation, and other expertise of its personnel inknowledge it had cultivated in financial services with the expertise

flexible and rapid adaptation to a changing environment andreal estate development and equity investment. In addition, theand diverse business experience of each department, including realenjoyment in taking on challenges in new areas are both values

domestic network of our Corporate Financial Services enabled us toestate, private equity investment in Japan and overseas, corporatethat must be passed down to new employees. ORIX conducts

quickly commercialize our business and grow into a leading player infinancial services, treasury, and credit. We are also utilizing thisan annual employee satisfaction survey (morale survey) tothe solar power generation business in Japan.

experience in the MICE-IR project that is currently under way.

monitor for changes in these core values, and through feedback

I n O R I X ’s c o r p o r a t e c u l tu r e , e m p l oye e s w i t h d i ve r s e
backgrounds collaborate to create new value. We believe thatto department heads, uses the results to identify current
Domestic sales network

issues and reflect them in various initiatives.

Real estate knowledge

Taking on the challenge of the solar
power generation business

The morale survey also provides a fixed-point understanding

Creation of airport concession businessof employee job satisfaction and ease of working, which isanalyzed by gender, age, and other attributes, as well as bydepartment and length of service. At the same time, we

Project-building
capabilities
cultivatedthrough realestate financing

Real estateknowledge

Partnerships
with foreigncompanies

Private equity
investment
expertiserevitalize the organization by conducting stress checks andsharing organizational analysis reports with department heads
to create a workplace where all employees can work in ahealthy and safe manner.
While directly incorporating employee feedback, we havelaunched a Work Style Reform Project with the aim of creating

Expert personnel hired fromoutside ORIX Group

Network in the Kansai region

a comfortable and rewarding working environment. Throughthese activities, we are instilling a culture that recognizes
diverse values and work styles.
Through efforts to improve productivity and to achieve andpromote employee well-being in response to a changing
environment, we aim to create a workplace where all
employees can continue to demonstrate their full potential.

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INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 44

Human Resources Strategy

Promoting Diversity, Equity, and Inclusion in Human Resource Development
ORIX Group’s most important asset is its human resources. The
source of ORIX Group’s growth is the creation of new value through a“Fusion of Intelligence” of diverse values and expertise. To continue
providing new value, it is essential to ensure not only diversity inconventional attributes such as nationality, age, gender, and work
history, but also diversity in perspectives and ways of thinking, basedon our concept of “Keep Mixed.”
We must therefore not merely promote diversity as a means offostering a culture that accepts diverse knowledge and values, andinclusion as a means of developing an environment where diversity
spurs friendly competition. We believe that it is also necessary tofurther promote the concept of equity. This means that we provide
support tailored to each employee’s area of expertise and background,and implement personnel measures that enable all employees tocontinue to play an active role.
Support for Independent Career Building
To develop such human resources, it is important for each employee toset clear goals for their own career, to strive proactively for selfimprovement toward those goals, and ultimately to increase the valueof their expertise and experience through their own business activities.
ORIX has established various systems in support of these efforts.
Our distinctive programs such as the internal internship system (asystem that enables employees to work in a department of theirchoosing for a certain period of time) and the career challenge system(a system that enables employees to directly request a transfer to thedepartment of their choosing) help employees build independent
careers and proactively take on challenges by experiencing various
Group operations while remaining ORIX employees.
In the fiscal year ending March 2024, we started an online coursewith our employees as instructors to further support independent
career building. In this course, employees from each department who
are familiar with its business not only talk about their work and theappeal of their jobs, but also introduce their careers and the self-

improvement they are working on. Having actual employees talk notonly makes their work feel closer and grants a deeper understandingof ORIX Group’s businesses, but also provides an opportunity to drawa more concrete career path by clarifying the skills required and thedetails of self-improvement.
We also provide rank-specific training, programs to acquire
specialized skills according to the work of each department, and an
online learning platform where employees can equitably learn a wide
range of content regardless of time and place. Average annual training
hours per employee at ORIX Corporation in the fiscal year ended March2023 was 24 hours, and the average annual training cost was ¥98,646.
Metrics and Targets for Promoting DE&I
One of our ESG-related material issues is to continue to improve
employee satisfaction by respecting the diversity of our employees
and creating an equitable and inclusive working environment that

Clarification of
Career Path

Accumulation ofWork Experienceand Skills• Job rotation• Internal internship system• Internal job
posting system

Independent
Career• Career consultation
with supervisor• Self-reporting system• Career challengesystemContinuous andVoluntary SelfImprovement• Various skills training,career developmenttraining• Online learning platform• Incentives for achieving
qualifications

promotes flexible working styles and provides career development
support, fair performance review and compensation schemes, andemployee health support systems.
In addition to hiring new university graduates in Japan, ORIX is also
focusing on hiring mid-career employees that bring new knowledge
and hiring new university graduates overseas. Mid-career hires
accounted for 70.0% of ORIX Corporation’s hires in the fiscal year
ended March 2023. As of March 31, 2023, 40.3% of our employees
are mid-career hires and 1.9% are foreign nationals. In addition, female
employees account for 44.2%.
Through the practice of ORIX’s human resource strategy “KeepMixed,” we consider the promotion of active participation by women
to be one of the benchmarks for participation in decision-making ande q u a l l e a d e r s h i p o p p o r tu n i t i e s fo r e m p l oye e s w i t h d i ve r s e
backgrounds. We have set and are promoting an increase in the ratioof female managers as one of our key goals.
Key Goal
Female employees to account for over 30% of management positions
at ORIX Group by the end of the fiscal year ending March 2030.
—— As of March 31, 2023, the ratio of female managers in ORIX
Group was 29.8% at ORIX Corporation and 25.7% at the 10
Group companies in Japan*.
* The 10 Group companies in Japan refers to ORIX, ORIX Auto, ORIX Rentec, ORIX Asset Management &Loan Services, ORIX Real Estate, ORIX Eco Services, ORIX Life Insurance, ORIX Bank, ORIX Credit,
and ORIX Computer Systems. ORIX Corporation and the nine other Group companies jointly operatepart of their human resources and personnel systems based on ORIX Group’s personnel strategy.

See here for details.
Human Resources System
Performance Review and Compensation Scheme
Human Resource Development System
Health Promotion System
Page 84 ESG DataINTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Human Resources Strategy

Viewing ORIX’s Human Resources
and Corporate Culture through Its
New Business Initiatives andInterdepartmental Collaboration

Knowledge and Know-How Accumulated through Interdepartmental
Collaboration Lead to Improvement of the Entire Organization

who drafted the proposal and Orichare promotion staff, discussions with

In conducting M&A and business investment, I emphasize an approach ofprocess of bringing business proposals to fruition contributes not only to the“strategize boldly, execute cautiously.” I believe it is important to conceive ofgrowth of our employees, but also to fostering a spirit of challenge and abold strategies with a high degree of freedom while carefully considering

corporate culture of collaboration.

risk-return tradeoff to identify “good risks” in management decisions.
CEO’s Office and New Business Development Department, which I oversee,

Venture Capital Investment That Combines the Expertise of ExternalTalent and the Knowledge of ORIX Employees

serve as a middle office that combines the functions of sales and management

In December 2022, ORIX Capital resumed venture capital (VC) investment.

departments. In particular, we are responsible for execution functions such as

Since its founding in 1983, ORIX Capital had been actively engaged indue diligence, valuation, and structuring, and support investment and newinvesting activities, investing in 1,655 companies, 216 of which havebusiness projects from their inception. The CEO’s Office handles overseas

conducted an IPO. After temporarily suspending new investment due to theprojects, and the New Business Development Department mainly handles

2008 financial crisis, we invited external experts with extensive experience

domestic projects. Through measures such as seconding members to workin venture capital and resumed investment activities. By forming a teamconcurrently in business units, we move projects forward with a sense ofcentered on external staff with an up-to-date awareness of the market andurgency in examining businesses and assessing risks through careful due

extensive work experience as venture capitalists, together with participation

diligence, even in areas that require specialized knowledge.

by junior and mid-career employees from ORIX, we will combine theBalancing the use of the accelerator and brakes is difficult. Therefore, theNobuki Watanabe
Executive Officer
Group Strategy Business Unit
Responsible for CEO’s Officeand New BusinessPresident,
ORIX Capital Corporation
ProfileJoined ORIX in August 2001. Previously employed at Daiwa Securities Co., Ltd.
At ORIX, has been mainly engaged in business investment, and involved inmany projects such as the acquisitions of Robeco and Yayoi, participation in the
Kansai International Airport concession, and investment in Avolon Holdings
Limited. After serving in positions including General Manager of New Business
Development Department and Assistant to Responsible for Group Strategy
Business Unit, appointed Executive Officer Responsible for CEO’s Office and
New Business in the Group Strategy Business Unit in January 2023 (to present).

external mentors, and questions from officers and external experts, theBy advancing projects together with employees in the field, the department

expertise of external talent with the financial knowledge and investment

develops a track record of the processes, knowledge, and know-how needed

experience of our own employees to conduct VC investment that is uniqueto bring the project to fruition, which also leads to human resource

to ORIX Group.

development. Moreover, passing on the knowledge and know-how acquired byexperienced employees to younger employees and others creates a cycle that

ORIX Group Purpose Discovery Project

improves the entire organization and further accelerates its responses.

ORIX Group has grown into one of Japan’s leading corporate enterprises, withapproximately 35,000 employees in 28 countries and regions. As the

New Business Job Posting System Helps to Foster a Spirit ofChallenge and a Corporate Culture of Collaboration

globalization and diversification of our business advances and more employees

The internal new business idea competition (Orichare - ORIX Challenge),

conducting a project to specify our Group purpose to foster anew a sense ofwhich started in 2019, will be held for the fifth time in 2023. This is anorganizational unity. To match the overall balance of ORIX Group in terms ofinitiative to solicit new business ideas lying dormant within ORIX Group,

attributes such as age, gender, and occupation, we have recruited more thanwork out business plans together with the Orichare promotion staff in the

100 employees in Japan and overseas to discuss the strengths of the GroupNew Business Development Department and external mentors, andand the value we want to provide to society among diverse project members.

commercialize them after undergoing a final internal review.

Officers as well as employees have been discussing the message that we

Through measures including creating teams composed of the memberswith diverse backgrounds work in ORIX Group, since June 2022 we have been

want to pass on to the next generation.

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INTRODUCING ORIX

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STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 46

Risk Management
Approach to Risk Management

Group-wide Risk Management System (As of June 30, 2023)
Board of Directors

ORIX allocates resources in line with Group-wide risk preferences
based on management strategies and the strategies of individual

Reportthe risk-adjusted allocation of resources by precisely profiling thecharacteristics of various risks relevant to Group business initiatives
worldwide and managing them intelligently according to type anddegree of impact.

Risk Management System
The Board of Directors makes decisions about the risk management

address a wide array of risks both comprehensively and individually.
These include executive bodies and departments in charge of risk
management, comprehensive rules and regulations, investment
standards, and limits on value at risk for deals along with relevant
reporting and monitoring systems. The Board of Directors receives anannual report on the operational status of the internal control system
and its component risk management system.

2

Deliberates on important matters related to sustainability.
Reports to the Board of Directors as necessary.

3

Deliberates on specific investment and lending transactions.
Deliberates in the Executive Committee and reports to theBoard of Directors as necessary.

4

Deliberates on important matters concerning fundamental IT
policies and strategies as well as the introduction andmaintenance of IT systems.

5

Aggregates important information, considers needs andmethods for timely disclosure, and coordinates disclosure.

6

A forum for all executive officers to share important
information related to Group business administration.

7

A forum for business unit managers to discuss strategy andch a n g e s i n t h e b u s i n e s s e n v i r o n m e n t w i t h t o p
management.

CEO and Executive Officers
Executive Bodies
1. Executive Committee
2. Sustainability Committee
3. Investment and Credit
Committee
4. Information Technology
Management Committee

5. Disclosure Committee
6. Group Executive Officer
Committee
7. Business Unit Strategy
Meeting

Submit and report

Deliberate and direct

system as part of the overarching internal control system. ORIX has
the requisite risk management systems and techniques in place to1

D e l i b e r a t e s o n c a p i t a l p o l i c y, a s s e t a n d l i a b i l i t ymanagement, accounting and t axation, compliance,
personnel, and other important management matters.
Reports to the Board of Directors as necessary.

Delegate executive authority

business units. We also allocate more resources to business units
with growth potential while controlling our balance sheet. We optimize

Executive bodies manage risk under the supervision of the Boardof Directors. These bodies and their responsibilities are as follows.

Internal Control-related Functions
CreditLegal
Corporate planning
Investor relations
Sustainability
Treasury
Compliance
Accounting

Public relations
Public affairs
Human resources
Corporate administration
Information security
Enterprise Risk Management(ERM)

Internal control-related functions laterally identify, analyze, andCooperate and report

SupportBusiness Units

manage Group risks under their control. They also help business units
manage risk.
Business units autonomously manage risk in line with businessstrategies and plans. They regularly verify risks and returns according
to the progress of projects and changes in the external environment.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Risk Management

Risk Factors and Risk Management
Departments Handling Risks

Executive Bodies Related to
Risk Management

Corporate planning, Credit,
Public relations, Public affairs,
Investor relations, Sustainability,
Treasury, ERM

Executive Committee
Sustainability Committee

Credit, Corporate planning,
Accounting, ERM

Investment and Credit
Committee• Thoroughly analyze risk (scenario analysis and stress testing) before executing a business or investment• Improvement of the quality of products and services through regular monitoring as well as evaluation and verification of withdrawal costs,
after execution of businesses and investments

Credit, Corporate planning,
Accounting, ERM

Investment and Credit
Committee

Market risk

• Establishment of an integrated management system for assets and liabilities (comprehensive understanding and verification system formarket risks, using derivative transactions as a means of hedging)

Credit, Treasury, Corporate
planning, Accounting, ERM

Executive Committee

Liquidity risk
(risk related to funding)•P romotion of diversification of procurement methods• Strengthen management of liquidity on hand (implementing stress tests of liquidity risk and developing countermeasures, understanding
liquidity risks for each country as well as subsidiary and developing countermeasures)

Treasury, ERM

Executive Committee• E stablishment of an effective compliance structure alongside a corporate culture that values high ethical standards (formulating andimplementing a compliance program, establishing internal regulations and promoting compliance awareness through activities to disseminate
information, establishing internal and external compliance hotlines)

Compliance, Public relations,Public affairs

Executive Committee
Sustainability Committee• Establishment of a legal compliance and legal risk management system (establishing internal regulations for legal compliance, understandinglaws and regulations applicable to each business, and implementing appropriate responses to revisions to the law)

Legal, Accounting, Investor
relations, Sustainability

Executive Committee
Sustainability Committee

Information Security

Information Technology
Management Committee

ERM, Human resources,
Corporate administration,
Accounting, Public relations,Public affairs

Executive Committee
Sustainability Committee

Risk Factors

External environmentrelated risk

Credit risk

Risk Management• Establishment of a system that enables sound financial operation to continue by diversifying our profit structure with diversified businessdevelopment and by securing sufficient liquidity•E stablishment of a disaster risk management system
Business Continuity Planning (Disaster Risk Management System)•E stablishment of a system to respond to climate change risks

Page 29 Sustainability Governance Structure
Page 35 Information Disclosure Based on TCFD Recommendations• When appraising individual projects, comprehensively evaluate the credit recipient’s financial condition, cash flow, underlying security
interests, profitability, etc.
• Strengthen credit risk management methods for individual projects and portfolios (obtaining sufficient collateral and guarantees, diversifying
industries and credit recipients, controlling exposure to potentially high-risk markets)
Risk Management System for Investing and Lending

Business risk

Risk Management System for Investing and Lending

Compliance risk

Compliance

Legal risk
Information andcybersecurity risk

Operational risk

• Establishment of an information system and cybersecurity risk management system (establishing internal regulations, implementing technicalmeasures such as vulnerability management measures for information systems and network protection, establishing systems for response in
the event of information security incidents, and implementing measures to reduce the risk of system failures)
Information Security•E stablishing, disseminating, and training about internal regulations•E stablishment of systems related to execution of operations– Building an internal control system for financial reporting– Establishment of a personnel system and a work environment to stably secure diverse human resources
Human Resources Strategy to Support Sustainable Growth– Continuously strengthen the overall risk management system through monitoring of operational risks by the Audit Department• Establishing system for responding to and preventing recurrence of operational risk incidents, and risk control self-assessment
Incident Management System| 47

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Risk Management

Investment Risk Management:
Assess and Manage Risks for Both Individual Projects and Portfolios
from Entrance Screening to Post-implementation Monitoring

Strengthening ERM Functions:
Ongoing Improvements in Risk Management in Response to theDiversified Business and Growth of ORIX Group

Ikuo Nakamura

Takashi Otsuka

Executive Officer
Group Strategy Business Unit
Responsible for Credit and Investment Management

Executive Officer
Group Strategy Business Unit
Responsible for Enterprise Risk Management

ProfileJoined ORIX in November 1998. Previously employed by The Long-Term Credit Bank ofJapan, Limited (currently SBI Shinsei Bank, Limited). At ORIX, he has had experiencein private equity investment and global business (investing in emerging countries andfinancial business in the Asian region) for approximately 10 years each, and has been
involved in credit since 2020. In 2023, he was made Executive Officer responsible for
Credit and Investment Management in the Group Strategy Business Unit.

The person responsible for Credit and Investment Management is in charge of assessing and managing therisks associated with investing and lending transactions through the screening and monitoring of various
projects as the unit that serves as ORIX’S internal control-related function for credit.
ORIX’s businesses are diverse, and screening of investing and lending transactions entails judgments
about projects in a wide range of fields, sometimes even unfamiliar ones. Based on profitability analysis
encompassing IRR and NOI, efficiency of ROE and ROA, cost of equity capital, and other factors, we verify
whether we can secure a sufficient return commensurate with the risk. We identify risks from various
perspectives, such as business risks, market fluctuation risks, and asset value fluctuation risks until funds
are collected, and together with our legal, accounting, compliance, and other specialized functions, we havebuilt a framework that allows us to analyze a wide range of risks and make comprehensive decisions.
By monitoring the progress of individual projects and changes in the portfolio after making an investment,
we have established a system to quickly grasp changes in the business environment and other factors andtake necessary measures in a timely manner. For individual projects, we monitor whether there are anychanges in business details or circumstances, such as whether the business earnings of each project orprogress in the management integration process falls below a certain level. We also monitor whether there
are any changes in the entire portfolio, using this information in project screening.
Currently, ORIX Group has accumulated a wide variety of investments under a theme of “capital recycling.”
Our aim is cyclical business expansion and portfolio optimization from selling investments we hold andallocating those funds to other investments. Recently, the market is uncertain at the global level due to inflation,
financial instability, and other factors. While considering optimization of ORIX Group’s portfolio, we intend tostrengthen our risk assessment of individual projects to stay ahead of sudden changes in the market.

ProfileJoined ORIX in May 2020. Previously engaged in risk management at Goldman Sachs
Japan Co., Ltd. for over 15 years and was Chief Risk Officer. At ORIX, he has been in
charge of strengthening enterprise risk management functions throughout the Group.
In 2023, he was made Executive Officer responsible for Enterprise Risk Managementin the Group Strategy Business Unit.

At ORIX, we leverage our extensive sales network in Japan and overseas and use our financial knowledge andknow-how accumulated over many years to hold discussions with internal control-related functions and makedecisions in committees and other bodies. This gives us a robust system for screening individual projects fromvarious perspectives and levels and for post-investment monitoring. As ORIX’s enterprise risk management
function, the ERM unit is developing and strengthening systems so that we can accurately grasp and evaluatecharacteristics of various risks related to portfolios made up of these individual projects on a global level, andensure appropriate management according to the type of risk and the degree of impact on management.
One important tool for this is a dashboard. In collaboration with credit and other related functions, we havestarted operation of a dashboard that visualizes risk for the entire Group, including financial and non-financial
risks. This has been strengthened as a mechanism to share risk information more quickly and systematicallywith top management and related departments and lead to necessary actions.
Through this mechanism, we can grasp and evaluate the impact of various global events occurring insideand outside ORIX Group, and link the results to actions. In this manner, we have put in place measures thatenable risk management in response to the diversified business and growth of ORIX Group.
We intend to continue to improve, enhance, and digitalize our dashboard and other tools for a platform thatgrasps risk information from various levels and approaches, thus enabling us to respond in the VUCA* era sothat ORIX can continue to diversify and grow its business.
* V (Volatility), U (Uncertainty), C (Complexity), A (Ambiguity)| 48

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Promoting a Digital Transformation
Business Process Improvement and New Business Creation
ORIX is undertaking digitalization to fully deploy the intellectual capitalof its accumulated knowledge and expertise. We are therefore
digitalizing with due consideration for the diversity of our businesses,
which involves striking a balance between what is optimal for eachindividual business and for the Group at large. We categorize our
promotion of digital transformation into two themes: business process
improvement from digitalizing and streamlining internal operations,and the use of digital technology and data to create new businesses.
ORIX prioritizes business process improvement while creating new
businesses, with emphasis on our balanced approach to optimizing
both individual businesses and the Group at large.
We have est ablished the Technology Department and theInformation Securit y Control Department as holistic Group
organizations that drive digitalization. In addition, ORIX Computer
Systems is the lead organization in developing and operating Groupsystems. These organizations collaborate with business units toPromoting Our Digital Strategy
Takuma Nagasawa
Head of Digitization &Digitalization Office
Corporate Business Headquarters
ProfileJoined ORIX in November 20 05
following experience at a startup. At
ORIX, has been engaged in financing forc u s t o m e r s i n t h e i n fo r m a t i o n a n dtelecommunications industry, planningand operation for the new business ofproviding credit information services,business improvement through theintroduction of smartphones, CRM, andother methods, and B2B marketing.
Assumed his current position in 2021
with the establishment of theDigitization & Digitalization Office.

promote a digital transformation. Each business unit has its own
people and team specializing in digitalization. The digitalization
promoted by business units is based on an approach of discrete
optimization. Concurrently, the Technology Department and otherorganizations manage intra-Group issues including enterprisearchitecture, governance, and analytics to ensure high-quality holistic
optimization.
For example, in systems development, each business unit takes
ownership of the development of its customer relationshipmanagement (CRM) and other customer interfaces. From theperspective of holistic optimization, intra-Group systems are limited tobuilding dashboard functions that enable rapid business portfolio
monitoring and functions related to tax and accounting matters.
However, we address large-scale projects such as upgrading coresystems where close communication with related departments isrequired, with a collaborative Group-wide organization.

In the digital transformation (DX) of the Corporate Business Headquarters,
which is the Group’s core sales platform, our mission is to integrate
customer and Group information, and connect online with customers andpartners for a system that appropriately and suitably provides the Group’s
financing functions and services. In addition, by lowering the threshold for
digitalization and DX for the small and medium-size enterprises (SMEs)
nationwide who are our main customers as well as for ORIX, we intend todeliver the benefits of digital technology, such as ChatGPT*1, to a wide
range of people.
We are therefore currently working for both the reform and digitalizationof internal operations and new businesses. For the reform and digitalizationof internal operations, we are working to streamline information and to
improve productivity and risk management. Our work entails aggregating
not just sales information but also core information such as applications,approvals, and contracts in customer relationship management (CRM), andlinking it with core systems via API* 2. As for new business, we havedeveloped an online storage service that can be used to search and share

Two Themes for Digital Transformation
Business process improvement

New business creation

CRM andother customer interfaces

Structured throughbusiness unit ownership

Portfolio dashboard and tax
and accounting processes

Holistic
intra-Group systems

Technology Department
Information Security
Control Department
ORIX Computer Systems

×Business Units

documents in compliance with Japan’s Electronic Books Preservation Act
by simply uploading business documents and digitizing them using AIOCR* 3 technology. The service has been launched under the name
PATPOST, which connotes instantaneous storage and sharing in Japanese.
Both initiatives are being carried out by an organization for co-creationand in-house production that brings together mainly young mid-career hireswith various backgrounds and members of an IT department on loan from
ORIX Computer Systems. We are working to acquire design capabilities forbusinesses and operations premised on digital technology. Our ultimate
aim is to use mechanisms that digitalize and link internal information andcustomer information to create systems that interconnect value fromvarious industrial and academic fields to provide convenience from across
ORIX Group to end consumers.
*1 ChatGPT: Artificial intelligence (AI) that generates natural text, released by OpenAI of the UnitedStates in 2022.
*2 API: Application Programming Interface (mechanism for connecting systems and sharing data andfunctions).
*3 AI-OCR: AI-Optical Character Recognition (optical character reader incorporating AI).

Page 66 Corporate Financial Services “PATPOST”| 49

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATION

Corporate GovernanceThis section introduces ORIX’s system of governance.

Corporate Governance at ORIX

51

Management Team53

Messages from Outside Directors

55

Evaluation of Effectiveness of the Board of Directors

57

Activities of the Board of Directors and the Three Committees

58

Compensation System

59

Execution of Operations Framework

61

Management Team:
Executive Officers and Business Unit Managers

62

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 50

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 51

Corporate Governance at ORIX
Strengthening corporate governance to help society develop sustainably, to increase corporate value, and to be a company all stakeholders trust is a management priority for ORIX.
We are committed to exceptionally sound and transparent corporate governance.

Approach to Corporate GovernanceCorporate Governance Framework (As of June 30, 2023)• O RIX believes that a robust corporate governance system is

ORIX’s corporate governance system is characterized by:essential for ensuring objective management and carrying out• Separation of execution and supervision through a “Company with Nominating Committee, etc.” board model;

appropriate business initiatives in line with its core policies. We
have therefore established a sound and transparent corporate
governance system.

• Nominating, Audit, and Compensation Committees composed entirely of outside directors;• All outside directors satisfying “Requirements for Independent Directors”; and• All outside directors being highly qualified in their respective fields.

• Corporate governance is a system for management oversight. It

General Meeting of Shareholders

involves setting management objectives for managers,
performance analysis and evaluation, and supervision in orderAppointment or
dismissal of directors

to ensure that management strives to attain outstanding results.
The tension inherent in corporate governance encourages
innovation in pursuit of corporate objectives. Such an approachis conducive to the achievement of consistently high ROE.
• Outside directors play a crucial role in corporate governance.

Management / Supervision
Board of Directors

Ratio of outside
directors: 54.5%(6 of 11 directors)

backgrounds, outside directors are able to objectively evaluate
industry’s conventional wisdom and the Company’s ingrained
practices. Moreover, by virtue of their external perspectives,

Decides candidates
for directors

Compensation
Committee

Decides the compensation
for directors andexecutive officers

6 outside directors

From various perspectives reflecting their diverse professional
management’s performance in ways that transcend theNominating
Committee

5 internal directors

Ratio of female
directors: 18.1%(2 of 11 directors)

Audit
Committee

outside directors are in the position to objectively evaluate theMonitors operational
execution of directors
and executive officers

Reportingrisk of management not taking adequate levels of risk.
For details on ORIX’s corporate governance, please refer to the following:
Corporate GovernanceCorporate Governance Report
Form 20-F filed with the U.S. Securities and Exchange Commission

Supervision

Execution of Operations Framework** Please refer to page 61 for Execution of Operations Framework.

Financialauditing

Independent Public Accountants

management to perform to the best of its ability and facilitates

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Corporate Governance at ORIX

Initiatives to Enhance Corporate Governance

Key Initiatives

Objectives

Providing new value and contributing to society through business1964 Adopted U.S. GAAP• Communicate results and businesses accurately to investors

initiatives are fundamental to ORIX. We also believe that client trust is1970 Listed on the second section of the Osaka Securities Exchange• Increase corporate value

1997 Established Advisory Board• Separate management supervision and execution to raise theefficiency of execution of operations

essential when it comes to expanding our business and achieving
sustainable growth. A highly transparent governance framework that

Overall Corporate
Governanceenables swift decision-making is essential in gaining stakeholder trust
and achieving sustainable growth.

1998	Introduced Corporate Executive Officer System and listed on the
New York Stock Exchange
2003	Transitioned to a “Company with Committees” board model(currently a “Company with Nominating Committee, etc.”)• Ensure the involvement and counsel of independent outside
directors regarding executive personnel and compensation• Appoint managers and determine their compensation fromthe perspective of shareholders

ORIX has been strengthening corporate governance as amanagement oversight function since its founding. The current
corporate governance framework requires management to maintain a• Increase convenience for foreign shareholders

high level of discipline; we believe this is crucial and necessary inManagement Team
Diversityachieving a sound, secure corporate governance system, both forPage 53

management itself and from a corporate management perspective.

1999	Introduced an outside director system• Strengthen supervision

2003	Began appointing non-Japanese outside directors
2010	Began appointing female outside directors• Ensure objectivity in determining risk by using people withdiverse backgrounds

2017	Outside directors make up at least half of the Board of Directors• Operation led by outside directors

2021	Disclosed skill matrix for all directors

Page 542022	Outside directors comprise the majority of the Board of Directors

The table on the right elucidates the initiatives that ORIX has
2016	Evaluation of effectiveness of the Board of Directors initiatedemphasized in strengthening its corporate governance framework.
Evaluation of
Effectiveness of theBoard of Directors
Page 572022	Appointment of an outside consulting firm
Key initiatives to improve effectiveness implemented since 2016:
Going paperless; establishing occasions exclusively for outside
directors to exchange opinions; providing information on investor
perspectives; and setting up opportunities to explain mid- tolong-term strategies of business units to outside directors• Sufficiently study Board of Directors agenda items andimprove the quality of deliberation• Incorporate the third-party perspective of an outside
consulting firm in evaluations• Strengthen the system for sharing information among
outside directors•H elp outside directors deepen their understanding of businesses• Understand investors’ concerns

1997	Introduced stock option plan
2002	Abolished retirement bonuses
2005	Initiated share component of compensation

Compensation
SystemPage 59

Began reflecting business unit performance in addition to Company-wide
performance in annual bonuses from the fiscal year ended March 2017
Increased ratio of performance-based compensation for directors andexecutive officers in the fiscal year ended March 2021
Began reflecting the status of ESG initiatives in qualitative evaluations
for annual bonuses in the fiscal year ended March 2022
Began reflecting progress toward ESG-related key goals in quantitativeevaluations for annual bonuses in the fiscal year ending March 2024** A pplied to the President, the Senior Managing Executive Officers, and the Managing
Executive Officers• Improve motivation to contribute to operating results andmid- to long-term results• Promote ESG initiatives and improve motivation to contributeto achieving ESG-related key goals| 52

INTRODUCING ORIX

VALUE CREATION STORYManagement Team

CREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

(As of June 22, 2023)

Members of the Board of Directors
Makoto Inoue   Age: 70

Shuji Irie  Age: 60

Member of the Board of Directors, Representative Executive Officer, andPresident and Chief Executive Officer
Responsible for Group Strategy Business Unit

Member of the Board of Directors, Senior Managing Executive Officer, andHead of Investment and Operation Headquarters
Profile Joined Mizuho Securities Co., Ltd. in 2001. Joined ORIX in 2011.
After serving in positions including Deputy Head of Investment andOperation Headquarters, appointed Director and Senior Managing
Executive Officer in January 2020 (to present).

Profile Joined ORIX in 1975. After serving in positions including Deputy Head ofInvestment Banking Headquarters and Head of Global Business & Alternative
Investment Headquarters, appointed Director, Representative Executive Officer,
President and Chief Executive Officer in June 2014 (to present).

Satoru Matsuzaki   Age: 57

Stan Koyanagi   Age: 62

Yasuaki Mikami  Age: 55

Member of the Board of Directors, Senior Managing Executive Officer,
Head of Corporate Business Headquarters, Chairman, ORIX Auto Corporation,
and Chairman, ORIX Rentec Corporation

Member of the Board of Directors, Senior Managing Executive Officer,
Global General Counsel, and Responsible for Legal Function Unit

Member of the Board of Directors, Senior Managing Executive Officer,
Responsible for Corporate Function Unit, and Responsible for Work Style
Reform Project

Profile Joined Crown Leasing Corporation in 1989. Joined ORIX in 1997.
After serving in positions including Head of Eastern Japan Sales
Headquarters, appointed Director and Senior Managing Executive
Officer in January 2020 (to present).

Profile Joined SHEPPARD, MULLIN, RICHTER & HAMPTON LLP in 1985.
After serving in positions including General Counsel at ORIX USA
Corporation (currently ORIX Corporation USA), joined ORIX in 2013.
Appointed Director and Senior Managing Executive Officer inJanuary 2023 (to present).

Profile Joined ORIX in 1990. After serving in positions including Senior Vice
President and Treasurer at ORIX USA Corporation (currently ORIX
Corporation USA) and Head of Group Human Resources andCorporate Administration Headquarters, appointed Director andSenior Managing Executive Officer in June 2023 (to present).

Outside Directors
Michael Cusumano   Age: 68• Compensation Committee• Deputy Dean, Faculty of Management, Sloan School of Management at
Massachusetts Institute of Technology• Professor, Faculty of Management, Sloan School of Management at
Massachusetts Institute of Technology• Member of the Board of Directors (Outside Director), Multitude SE
Profile Has served as Professor, Faculty of Engineering Systems,
School of Engineering at Massachusetts Institute of Technology andSpecial Vice President and Dean, Tokyo University of Science.
Appointed Outside Director in June 2019 (to present).

Aiko Sekine  Age: 65• Audit Committee (Chair) • Nominating Committee• Professor, Waseda University, Faculty of Commerce• Trustee, International Valuation Standards Council• Advisor of Japanese Institute of Certified Public Accountants•A udit & Supervisory Board Member (Outside), Sumitomo Riko Company Limited• Audit & Supervisory Board Member (Outside), IHI Corporation
Profile Has served as partner of Aarata Audit Corporation (currently
PricewaterhouseCoopers Aarata LLC) and Chairman and President ofJapanese Institute of Certified Public Accountants.
Appointed Outside Director in June 2020 (to present).
Please refer to the following for detailed profiles of ORIX’s Board members.
Profiles of Board Members and Executives

Sakie Akiyama  Age: 60• Nominating Committee (Chair)

Hiroshi Watanabe  Age: 73• Compensation Committee (Chair) • Nominating Committee• Founder, Saki Corporation• Member of the Board of Directors (Outside Director),
Sony Group Corporation• Board of Directors (Outside Director), JAPAN POST HOLDINGS Co., Ltd.
• Member of the Board of Directors (Outside Director), Mitsubishi Corporation• President, Institute for International Monetary Affairs• Outside Director, Mitsubishi Materials Corporation

Profile Founded Saki Corporation after serving at Arthur Andersen & Co.
Appointed Outside Director in June 2019 (to present).

Profile Has served with the Ministry of Finance and as Governor,
Japan Bank for International Cooperation.
Appointed Outside Director in June 2020 (to present).

Chikatomo Hodo  Age: 62• Audit Committee • Compensation Committee

Noriyuki Yanagawa  Age 60• Audit Committee• Outside Director, Konica Minolta Inc.
• Outside Director, Mitsubishi Chemical Group Corporation• Outside Director, Sumitomo Mitsui Banking Corporation*• Professor, Faculty of Economics of Graduate School of Economics
at the University of Tokyo

Profile Has served as Representative Director and President andSenior Corporate Advisor of Accenture Japan Ltd.
Appointed Outside Director in June 2021 (to present).
* Appointed on June 29, 2023.

Profile Has served as Associate Professor, Faculty of Economics ofGraduate School of Economics at the University of Tokyo.
Appointed Outside Director in June 2022 (to present).

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INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 54

Management Team

Skill Matrix

Nomination Criteria for Candidates for Member of the Board of Directors
Established by the Nominating Committee

The skills and experience expected of the directors who supervise ORIX’s multifaceted business activities are• Internal Directors

as follows.

– An individual with a high degree of expertise related to ORIX’s businesses– “Corporate Management” in order to understand changes in the business environment, and create and– In addition, an individual with excellent skills in management decision-making and business execution

implement appropriate growth strategies• Outside Directors– “Global Business,” which is necessary for ORIX as it expands its business globally– An individual with abundant experience as a manager of an enterprise– “Finance” and “Business Investment” in order to deeply understand ORIX’s wide range of businesses– An individual with professional knowledge related to corporate management in fields such as economics,– “ Business Knowledge” in areas such as tax affairs, accounting, ERM, legal affairs and information

business administration, law or accounting

technology, which is the basis of decision-making on important management matters– A n individual with extensive knowledge related to corporate management in areas such as politics,

The table below does not represent all the knowledge and experience of each person, but indicates skills

society, culture or academics

and experience that are considered significant.
Name

Gender Nationality

Years ofServiceCommittee Membership

Main Skills and Experience, etc. of Members of the Board of Directors
Corporate Management

Global Business

FinanceBusiness Investment

Makoto Inoue

Male

Japan

13 years

●

●

●

●

Shuji Irie

Male

Japan

5 years

●

●

●

●

Satoru Matsuzaki

Male

Japan

4 years

●

●

●

●

Stan Koyanagi

Male

USA

6 years●●

Yasuaki Mikami

Male

Japan

—

●

●

●

Business Knowledge●(Enterprise Risk Management, Legal)●●

Michael Cusumano

OutsideIndependent

Male

USA

4 years

Compensation Committee

Sakie Akiyama

OutsideIndependent

FemaleJapan

4 years

Nominating Committee (Chair)●●

Hiroshi Watanabe

OutsideIndependent

Male

Japan

3 years

Compensation Committee (Chair),Nominating Committee●●

Aiko Sekine

OutsideIndependent

FemaleJapan

3 years

Audit Committee (Chair),Nominating Committee

Chikatomo Hodo

OutsideIndependent

Male

Japan

2 years

Compensation Committee,
Audit Committee

Noriyuki Yanagawa

OutsideIndependent

Male

Japan

1 yearAudit Committee(Information technology)●(Technology)●●(International finance, Tax affairs)●(International accounting)

●

●

●

(Information technology)●●(Economics and financial policies)

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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Messages from Outside Directors
Heightening Sensitivity to Financial Costs by Understanding Changes in the Environment, Selecting andFocusing on ESG Issues, and Sharing All Employees’ Visions for the Future to Follow “the ORIX Way”
Heightening Sensitivity to Financial Costs
Recovery from the COVID-19 pandemic has changed thebusiness environment, as well as global macro indicatorsand financial policies. To take one example, funds used
to be relatively easy to raise, especially in Japan, withlittle need for concern about the cost of doing so.
However, those days are coming to an end. Funding
costs have risen, and we have entered an era where weneed to know how to make the best use of these highcost funds. Financing accounts for a large portion of
ORIX’s business, so it must be more cost sensitive.
However, the number of people at ORIX who haveexperienced a period of high costs has been declining.
As someone who remembers such times, I have beentalking about this matter at Board of Directors meetings.

Requirements for Global Growth:
Regional Management and Appropriate
Compensation to Secure Capable Talent

Hiroshi Watanabe
Compensation Committee (Chair)
Nominating Committee(Outside Director since June 2020)
Mr. Watanabe has extensive knowledge and experience as a financeand economic expert both in Japan and overseas, as well as wideranging experience in corporate management. He joined the Ministryof Finance Japan and started his career in the Tax Bureau, then served
as Director-General of the International Bureau. He then served as Vice
Minister of Finance for International Affairs, which is the chief officer ofmonetary policy, for three years. After retiring from the Ministry of
Finance, he served as Deputy Governor of Japan Finance Corporation,
as well as Governor of the Japan Bank for International Cooperation,and currently serves as President of the Institute for International
Monetary Affairs. He has an extensive human network of financial
authorities in various countries and has published books oninternational financial markets.

I believe that ORIX’s growth potential lies not in Japanbut overseas, especially in Asia. However, there is muchto do to achieve global growth.
Currently, ORIX’s management structure views theAmericas as a single economic zone including Mexicoand South America, with the United States at its core.
However, it treats each Asian country independently. I
believe that more than half of global GDP growth going
forward will come from Southeast and Southern Asia.
ORIX’s approach to segmenting the region and putting
management systems in place will therefore beimportant for benefitting from that growth.
ORIX has entrusted operations to local managementin each country, but basically oversight of Asia as awhole is done from Tokyo. I believe that there is room toreview this approach and I have brought it up at Board
meetings. Also, good people are crucial for ensuring aneffective management structure. If ORIX cannot
delegate authority, good people will not come aboard.
They need to be given a relatively high level of authority
and a certain level of discretion.
Another important matter is compensation. Japan’s
wage system sets compensation too low to recruit
world-class talent. To attract capable talent, ORIX shouldr a i s e i t s c o m p e n s a t i o n l e v e l s a n d s h i ft t o acompensation structure that values those who arevalued in the market.

Selecting and Focusing on ESG Issues
Since the fiscal year ended March 2022, ORIX has beenfactoring the status of ESG initiatives in qualitativeevaluations for executive officer compensation. From
the fiscal year ending March 2024, this will also bereflected in quantitative evaluations. Nowadays, allcompanies address ESG as a matter of course, but it isimportant to select areas of focus. It is not necessary to
pursue all 17 of the SDGs, and ORIX should consider
what to emphasize and narrow the SDG targets down
to five or six to achieve meaningful results.
For instance, ORIX has been active in promoting
women’s empowerment, but other companies arecatching up, so I would like ORIX to take it a stepfurther. It should present a career path to its own female
employees who have advanced their careers within the
Company for selection as members of the Board of
Directors, rather than bringing in candidates fromoutside the Company. This is an area where ORIX mustact promptly, and I trust it will do so.

Sharing All Employees’ Visions for the
Future to Follow “the ORIX Way”
Before I was appointed as an outside director in 2020, I
was not very familiar with what exactly ORIX does. Now
I have a clear understanding of the Company, butsometimes I wonder whether its business portfolio has
become a little too broad. Rather than holding onto
everything it has incorporated into its portfolio, ORIX
should let go of anything that is not in tune with its true
nature. Some may think any business is fine as long as
it makes a profit. However, holding onto a business may
result in overlooking other, more profitable projects.
Discarding items is at the very root of the concept of“selection and concentration.” In Japan, we are not very
proactive about throwing out or breaking up
unnecessary things, but I think ORIX should boldly
eliminate anything that is not in its future interests.
I also think that ORIX, with its wide range ofbusinesses, should have something to serve as a clear
theme that unites the Group. One possible solution isthe corporate purpose that is currently being developed.
It is important that all employees understand what ORIX
is aiming for and where it wants to go. That way, they
will all have a clear understanding of ORIX’s intentions in
the event it decides to eliminate a certain part of its
portfolio for future growth.
Rather than simply being satisfied with those
aspects where it outperforms its competitors, ORIX
should always be moving ahead to further its lead. If it
can do so, it should be able to transcend existing
frameworks to make ORIX a truly one-of-a-kind entity.

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Messages from Outside Directors

Digital Transformation Is Essential for Enhanced Horizontal
Integration and Cross-segment Collaboration
Streamlining Data Sharing for BusinessSuccess through Digitalization
ORIX has made a notable commitment in the IT space
t owa r d s a d va n c i n g d i g i t a l t r a n s fo r m a t i o n a n denhancing cybersecurity. However, I believe there is
still untapped potential for growth in establishing acomprehensive data sharing infrastructure across theentire organization.
Given that ORIX operates as a service company,
customer data plays a pivotal role within its core
operations. The more effectively ORIX can integrate
information platforms from different business units,t h e g r e a t e r t h e s c o p e fo r e m e r g i n g b u s i n e s sopportunities such as cross-selling or sophisticatedinvestment initiatives.
Such a data sharing infrastructure need not belimited to a single centralized platform, as such anarrangement would be highly challenging for an
organization of this complexity. Regional-level data
sharing can be a viable alternative provided that there isa robust mechanism in place to preserve confidentiality.

Fostering Horizontal Integration:
Unlocking ORIX’s Full Potential
ORIX deserves credit when it comes to its ability tovertically manage its business units. Each business unit
demonstrates exceptional management practices inisolation. However, to fully unlock the potential of ORIX,
there is a need to cultivate a greater degree of horizontal
integration by fostering stronger collaboration among

business units. Horizontal integration serves as thedriving force that propels ORIX to be more than the sumof its parts.
Of course, the easiest solution is to opt for a holding
company structure, where each business unit operates
independently. In my opinion, this approach is a defeat,acknowledging the inability to fully harness ORIX’s
potential and bring the business units together.
While the existing incentives for horizont al
integration are noteworthy, I believe that there is still
ample opportunity for improvement in this regard.
Currently, executive officers are incentivized with aportion of their compensation tied to the overall
performance of the Company, which is beyond theirscope of responsibility. In contrast, lower-level managers
are typically compensated based mainly on theirindividual areas of responsibility, with little regard to theoverall performance of the Company.
To foster horizontal integration, it is essential to
implement incentive programs that encompass
managers at all levels. A more comprehensive system
of incentives represents a significant area of opportunity
for further development and optimization.

Empowering Sustainable Businessthrough Collective Knowledge andRisk Sharing
ORIX’s operations encompass a range of practical andsocially beneficial businesses. The Company’s strong
dedication to sustainability is evident in its effort inl i n k i n g e x e c u t i v e o ff i c e r s’ c o m p e n s a t i o n t osustainability outcomes. This approach showcases
ORIX’s commitment to aligning financial performancewith environment al, social, and governanceconsiderations.
Moreover, ORIX maintains a unique competitive
position that stems from its diverse nature. The ability toharness its broad knowledge base and to share riskcollectively empowers ORIX to undertake investmentsthat would be beyond the reach of many othercompanies. Projects such as the participation in the bid
to take Toshiba private and MICE-IR serve as compellingexamples of projects that most companies would behesitant to pursue.

ORIX Board Governance—Confident Path Forward
As an integral part of ORIX‘s sound Board governance,
I offer you my assurance that our Nominating Committee
is diligently crafting a comprehensive succession plan
to ensure a seamless transition when the time comes.
Looking ahead, there will be a heightened reliance on
the executive team, instilling confidence in our ability
to navigate the transition to the next stage. In thisregard, our outside directors exhibit the requisite
skillset to lead the Nominating, Compensation and
Audit Committees, while insuring continued seamless
interaction with the executive team.

Michael Cusumano
Compensation Committee(Outside Director since June 2019)
Mr. Cusumano, a Japanese management specialist, conducted his
doctoral thesis on the Japanese automobile industry at Harvard
University. His research expanded to encompass the field of IT, leading
to the publication of his book titled Japan’s Software Factories in 1991.
The book was crafted in close collaboration with prominent Japanesecompanies, namely Hitachi, Fujitsu, NEC, NTT and Toshiba. Building
upon his expertise, he served as an Advisor and a Director for Fixstars
Corporation, a software company, for 15 years while actively engaging
in his academic pursuits at Tokyo University, Tokyo University of
Science and Hitotsubashi University.

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Evaluation of Effectiveness of the Board of Directors
As a part of efforts to establish a more sound and transparent corporate governance system, ORIX annually analyzes and evaluates the effectiveness of the Board of Directors to ensure the effectiveness ofdecision-making at Board of Directors meetings. The results of an analysis and evaluation during the fiscal year ended March 2023 confirmed, among other things, that the members of ORIX’s Board of
Directors have diverse backgrounds, that the majority of participants are outside directors with extensive experience, and that the Board of Directors operates under a system that effectively supervises
execution, with most of the decision-making authority for business execution delegated to executives. The results also confirmed that executive officers and the Board of Directors Secretariat are independently
working to improve the effectiveness of the Board of Directors. This includes responding to requests from the outside directors and making improvements to issues identified in the evaluation of effectivenessof the Board of Directors, thus fostering a relationship of trust between executives and Board members. Consequently, the Board of Directors of ORIX was evaluated to be functioning effectively.

Summary of Evaluation
Evaluation Procedure

Survey Content

An outside consulting firm conducts a survey and individually interviews all directors based on their responses to the survey.
The outside consulting firm analyzes and evaluates the content of the survey responses and individual interviews.
Results of analysis and evaluation are reported to the Board of Directors. The Board holds discussions and develops an action plan.

• Composition and operation of the Board of Directors meetings• Corporate strategy and business strategy• Corporate ethics and risk management• Communication and cooperation with stakeholders• Measurement of the effects of responses on policies for issues raised in the previous fiscal year
• Effectiveness of the Nominating Committee, the Compensation Committee, and the Audit Committee

Results for Fiscal Year Ended March 2023 and Action Plan for Fiscal Year Ending March 2024
Action Plan for Fiscal Year Ended March 2023
(Prepared in June 2022)
Deepening discussion of mid- to long-term strategies and future
direction was identified as an ongoing issue, and the Board of Directors
formulated the following action plan.
1) F urther strengthen the system for sharing information among
outside directors
Further strengthen the system for sharing information among outside directors
through actions such as regularly holding meetings to exchange opinions among
the outside directors only and the establishment of a facilitator to enable morecommunication with the management side.

2) Provide the perspective of investors
Expand opportunities to periodically provide the Board of Directors withinformation from the management side regarding the perspective of
ORIX’s investors.

3) C ontinue to hold business unit briefings* and make improvements toachieve well-balanced operations
Continuously set up opportunities to explain mid- to long-term strategies
of each unit to outside directors to further deepen their understanding of
the business.

Specific Initiatives and Evaluation Results of the Action Planfor the Fiscal Year Ended March 2023
1) Further strengthen the system for sharing information among
outside directors
Initiative: Held multiple lunches exclusively for outside directors and meetings
on themes related to the committees.
Evaluation: Improvements were made, but more opportunities should be
provided to further deepen discussion.

2) Provide the perspective of investors
Initiative: Reported to the Board of Directors on policies regarding financial
results presentations for and IR feedback from investors and analysts.
Evaluation: A certain amount of information was provided. With this as a basis,
further discussions are necessary to lead to specific responses.

3) Continue to hold business unit briefings and make improvements toachieve well-balanced operations
Initiative: Held once a year by all business units. Some business units held
them multiple times. Explanations of figures were reduced to focus more to
explaining strategies.
Evaluation: It would be better to deepen discussions by keeping explanations at
briefings to an overview-level to focus on Q&A sessions and discussion.

* Meetings in which each business unit reports on the current status of its business, mid- to long-term business strategies, progress of projects, and other matters, to share information necessary for supervision by outside directors.

Action Plan for Fiscal Year Ending March 2024
(Prepared in June 2023)
Deepening discussion of mid- to long-term strategies and future
direction was identified as an ongoing issue for this fiscal year as well,and the Board of Directors formulated the following action plan.
1) Share information on important initiatives in a timely fashion

While working to maintain and strengthen the system for sharing information
among outside directors, make timely status reports on particularly importantmatters. Without limiting information sharing to resolutions on a certain matter,
strive to share information that is particularly important from the perspective ofmonitoring execution.

2) Provide the perspective of investors and have outside directors holddialogues with investors

Enhance opportunities to share details of the dialogues held between the
representative executive officer (CEO) and investors with outside directors
so they gain a positive understanding of ORIX’s strategic vision. For outside
directors to understand investors’ concerns and make efforts to respond
appropriately based on such understanding, consider establishing a forum foroutside directors to engage in direct dialogue with investors.

3) Continue to hold business unit briefings

In addition to continuing to hold business unit briefings, prepare explanatory
materials earlier and collect questions from outside directors in advance to facilitate
Q&A sessions focused on subjects of greater interest to outside directors.

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Activities of the Board of Directors and the Three Committees
Main Activities and Deliberations during the Fiscal Year Ended March 2023
status of business execution from internal control-related functions,approved audit plans by the internal audit department, evaluated andconsented to compensation for the independent public accountants, andcoordinated with the independent public accountants.
• The Audit Committee established periodic occasions for review of theaudit plan and audit activities and examination of their direction for
purposes including enhancing discussions at committee meetings andstrengthening cooperation among committee members, and collected
information necessary for audit activities related to the current status ofeach business, business strategy, project progress and other mattersthrough on-site visits, briefing sessions and other measures.

Board of Directors• T he Board of Directors conducted activities including determining
proposals to be submitted to the general meeting of shareholders,determining basic management policies, appointing executive officers,delegating decisions on business execution to the representative
executive officer, evaluating the effectiveness of the Board of Directors,
and supervising the execution of duties by executive officers and others
based on reports from executive officers and committees.

Nominating Committee• The Nominating Committee conducted activities including determining
the content of proposals regarding the election of directors to besubmitted to the general meeting of shareholders, deliberating on theselection of directors to form each committee, appointing executive
officers and Group executives, deliberating on changes in the division ofduties, and deliberating on a succession plan.

Compensation Committee• The Compensation Committee conducted activities including evaluating
performance for performance-linked compensation (annual bonus) for
the fiscal year ended March 2022 and determining the amount to be
p a i d t o e a ch i n d i v i d u a l , d e l i b e r a t i n g o n a n d d e t e r m i n i n g t h ecompensation system for directors and executive officers for the fiscal
year ended March 2023, and deliberating on compensation levels for
directors and executive officers based on the results of a survey

Audit Committee• T he Audit Committee exchanged opinions with the representative
executive officer, received periodic reports on the status of businessexecution from executive officers, received individual reports on the

conducted by a third-party research organization.
• The Compensation Committee comprehensively evaluated details of thecompensation of individual directors and executive officers, including its
consistency with the compensation policy based on the resolution of theCompensation Committee held on June 24, 2022. In examining theappropriateness of compensation levels, it used the results of aninvestigation conducted by a third-party compensation researchorganization to make its determination, and concluded that they were inline with the compensation policy.
At ORIX,• Business unit briefings are held to report on the current status ofeach business, business strategy, progress of projects, and othermatters, and to share information necessary for supervision byoutside directors.
• O utside directors are able to attend meetings (as observers) ofcommittees in which they are not members, enabling them to listen
to discussions and to deepen their understanding of issues.

Number of Meetings Attended and Attendance Rate for the Board of Directors and Committee Meetings in FY Ended March 2023
Board of Directors

Nominating Committee

Number of Meetings Attended

Attendance Rate

Makoto Inoue

8/8

100%

Shuji Irie

8/8

100%

Satoru Matsuzaki

8/8

100%

Stan Koyanagi

8/8

100%

Yasuaki Mikami——

Michael Cusumano

8/8

100%

Sakie Akiyama

8/8

Hiroshi Watanabe

Audit Committee

Attendance Rate

100%

6/6

100%

8/8

100%

6/6

100%

3/3*1

100%

Aiko Sekine

8/8

100%

6/6

100%

14/14

100%

Chikatomo Hodo

8/8

100%

13/14

93%

Noriyuki Yanagawa

6/6*3

100%

11/11*4100%*1 Attendance at the Audit Committee meetings held while he was a committee member*3 Attendance at the Board of Directors meetings since he became a director*2 Attendance at the Compensation Committee meetings since he became a committee member*4 Attendance at the Audit Committee meetings since he became a committee member

Number of Meetings Attended

Compensation Committee

Number of Meetings Attended

Attendance Rate

Number of Meetings Attended

Attendance Rate

4/4

100%

3/3*2

100%

4/4

100%

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Compensation System
Compensation for Directors and Executive Officers
ORIX’s management objective is to increase shareholder value over the
medium- and long-term. We also believe that teamwork is key in ensuringthat directors and executive officers reliably execute their duties, and tocontinuously grow ORIX.
The Compensation Committee believes that directors and executive
officers should place importance not only on performance during the current
fiscal year but also on mid- to long-term results in order to achieve ORIX’s
management objectives. The Committee therefore draws on these
considerations in determining the structure and level of compensation for
directors and executive officers. The fundamental policy is to ensure thatcompensation is designed in a way that provides effective incentives for
directors and executive officers.
In light of this fundamental policy, the Committee therefore determined
the following compensation policies in accordance with the responsibilities
of directors and executive officers, based on the decision of theCompensation Committee at a meeting held on June 22, 2023.

Compensation Policy for Directors(those who do not concurrently serve as executive officers)• The compensation policy for directors who are not also executive officers
aims for compensation composed in a way that is effective inmaintaining the supervisory and oversight functions of executive officers’
performance in business operations, which is the main duty of directors.
Compensation consists of fixed compensation and share component ofcompensation* 1. In addition, ORIX maintains a competitive level ofcompensation according to the roles of directors, and receives thirdparty research reports on director compensation for this purpose.
• Fixed compensation is, in principle, a certain amount that is added to thecompensation of the chair and members of each committee.
• For share component of compensation reflecting mid- to long-term
performance, directors are granted a fixed amount of points on an annual basis
for their period of service, and they are paid in ORIX shares corresponding to
the amount of points they have accumulated at the time of retirement.
*1 Share component of compensation is a program in which a fixed amount of points is annually allocatedto directors and executive officers while in office, and granted through ORIX shares in trust based on
the number of accumulated points at the time of retirement. Points granted to the members of eachposition are determined based on the guidelines set by the Compensation Committee. The
Compensation Committee has not specified a period for which the shares issued under this program
must be held. The Compensation Committee may limit the payment of share component ofcompensation if it is determined that there has been serious misconduct during the term of office ofthe director or executive officer that caused damage to the Company.
*2 Compensation for executive officers based at overseas subsidiaries and executive officers with a high levelof expertise or other qualifications is decided upon deliberation for each individual in consideration of thelocal compensation system and level in addition to the executive officer’s expertise and other qualifications.

Compensation Policy for Executive Officers(including those who concurrently serve as directors)• Fixed compensation, performance-linked compensation (annual bonus),
and share component of compensation are set in a performance-linked
composition* 2 that encourages executive officers to execute theirprimary responsibility for execution of operations. The basic policy is to
set this composition at 1:1:1.
• ORIX draws on third-party compensation research reports to provide
effective incentives for executive officers and maintain a competitive
level of compensation.
• Fixed compensation is decided based on the standardized base amountfor each position followed by an adjustment in accordance with eachposition’s respective role and responsibility.
• Compensation linked to business performance for the fiscal year ended
March 2023 uses the level of achievement of the consolidated net income
growth target as a Company-wide performance indicator, adjusting 50%of the position-based standard amount within the range of 0% to 200%
while, at the same time, using the level of achievement of the target ofthe division for which the relevant executive officer was responsible*3 as
a division performance indicator, adjusting 50% of the position-based
standard amount within the range of 0% to 300%. In the case of therepresentative executive officers, the level of achievement of theconsolidated net income growth target is used as the sole performanceindicator, adjusting the standard amount within the range of 0% to 200%.
These performance indicators are selected based on the Company’s midterm management targets. In addition to the above, for the president, thesenior managing executive officers, and the managing executive officers,
an addition to or subtraction from the position-based standard amount ismade within the range of 0% to 30%, using the progress toward ORIX
Group’s ESG-related key goals as an indicator. If progress is made asplanned, this part of their compensation will be unchanged.
• For share component of compensation reflecting mid- to long-term
performance, executive officers are granted a fixed amount of points
based on their position, and they are paid in ORIX shares correspondingt o t h e a m o u n t o f p o i n t s t h ey h ave a c c u m u l a t e d a t t h e t i m eof retirement.

Conceptual Diagram of Compensation System for Executive Officers
Compensation Type

Fixed
compensation

Performance-linked
compensation(Annual bonus)

Payment Criteria

Determined according to role based on a fixed amount for each position
Executive Officers

President, Senior Managing Executive Officers, Managing Executive Officers

Company-wide performance indicator (50% of the position-based
standard amount)
Level of achievement of the consolidated net income growth target

Company-wide performance indicator (50% of the position-based
standard amount)
Level of achievement of the consolidated net income growth target

Division performance indicator (50% of the position-based standard amount)
Level of achievement of the target of the division for which the relevant
executive officer was responsible

Division performance indicator (50% of the position-based standard amount)
Level of achievement of the target of the division for which the relevant
executive officer was responsible
ESG progress (100% of the position-based standard amount)
Progress on ESG-related key goals

Share componentof compensation

For mid- to long-term compensation, directors and executive officers are granted a fixed amount of points based on their position, and paid in ORIX
shares corresponding to the amount of points they have accumulated at the time of retirement.
Note: Number of shares scheduled to be issued by share-based compensation plans (latent shares) is as shown on page 60.

*3 Determined through a comprehensive evaluation that takes into account qualitative factors (target difficulty, performance, preparation for the future, status of ESG initiatives, etc.), centered on the annual growth rate of
the performance of the relevant division for the fiscal year under review.

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Compensation System

Method for Calculating Performance-linked Compensation (Annual Bonus)
Executive Officers

Performance-linked
compensation(Annual bonus)＝

Standardized baseamount for each position
(50%)

×

Standardized baseamount for each position
(50%)

×

Level of
Achievement of Target

Level of
Achievement of Target

Level of
Achievement of Target

2021.32022.32023.3

Representative Executive Officer, Senior Managing Executive Officers andManaging Executive Officers

87%Standardized baseamount for eachposition (50%)× performance indicatorStandardized baseamount for eachposition (50%)

×

Division performanceindicator(Variable: 0% to 300%)

Standardized baseamount for eachposition (100%)×Progress in ESG(Variable: -30% to 30%)

Company-wide
performance indicator(Variable: 0% to 200%)

64%

Division performanceindicator(Variable: 0% to 300%)

50% to 150%
(Median: 95%)

103%

0% to 300%
(Median: 100%)0% to 150%
(Median: 100%)

Performance-linked
compensation(Annual bonus)＝

Company-wide(Variable: 0% to 200%)

Note: 2023.3 denotes the fiscal year ended March 2023.

• Company-wide Performance Indicator
To support the achievement of mid-term management targets, the Compensation Committee sets milestones for annual growth rate related toconsolidated net income. The level of achievement of this milestone for the fiscal year ended March 2023 was 87%.
• Division Performance Indicator
Division performance targets are based on Company-wide performance targets. The level of achievement of division performance targets amongthe 22 executive officers and 5 Group executives responsible for the fiscal year ended March 2023 (comprehensive evaluation including qualitative
aspects) ranged from 0% to 150%, with a median of 100%.
ORIX Shares Held (As of the Date of Submission of the Securities Report for the FY Ended March 2023)
Currently Held Common Shares

Latent Common Shares*

Currently Held Common Shares

Latent Common Shares*

Makoto Inoue

Name (Internal Directors)

101,072

682,948

Michael Cusumano

Name (Outside Directors)

0

6,500

Shuji Irie  4,200

156,490

Sakie Akiyama

0

6,500

Satoru Matsuzaki  9,800

151,420

Hiroshi Watanabe

0

5,000

Stan Koyanagi  5,000      0

Aiko Sekine

0

5,000

Yasuaki Mikami  2,267

90,388Chikatomo Hodo

0

3,500

Noriyuki Yanagawa

0

2,000

* Latent common shares are shares that are scheduled to be delivered equivalent to the cumulative points granted by the share component of compensation system.

Compensation for Directors, Executive Officers, and Group Executives (FY Ended March 2023)
Fixed Compensation
Category
Number of People

Performance-linked Compensation(Annual Bonus)

Amount Paid
(Millions of yen)

Number of People

Amount Paid
(Millions of yen)

Share Component of Compensation
Number of People

Amount Paid
(Millions of yen)

Total Compensation(Millions of yen)

Directors(Outside Directors)

7
(7)

106
(106)

—

—

7
(7)

20
(20)

126
(126)

Executive Officers and Group Executives

28

697

28

623

28

758

2,080

Total

35

804

28

623

35

778

2,207

For details on the number of ORIX shares held by executive officers and compensation for directors, executive officers, and Group executives, please refer to the following:
Form 20-F filed with the U.S. Securities and Exchange Commission•T he only performance indicators for the representative executive officer
are Company-wide performance indicators, which reflect the degree ofachievement of the annual growth rate target for consolidated net
income against a standardized base amount for each position.
Reflecting ESG Initiatives in Annual Bonuses
To encourage directors, executive officers, and Group executives
to take the initiative in addressing ORIX Group’s ESG issues, thestatus of ESG initiatives is reflected in their compensation.
• From the fiscal year ended March 2022, “Status of ESG
Initiatives” has been added as a qualitative evaluation item inthe division performance indicator for annual bonuses for
executive officers.
• From the fiscal year ending March 2024, progress toward ORIX
Group’s ESG-related key goals has been added as a quantitativeevaluation item for the president, the senior managing executive
officers and the managing executive officers.
Notes:
1. Number of recipients and amounts paid include one director and one executive officer (including thoseserving concurrently as directors and executive officers) who retired during the fiscal year ended March
2023. As of March 31, 2023, ORIX had 11 directors (6 outside directors), 22 executive officers (including
directors serving concurrently as executive officers), and 5 Group executives.
2. At ORIX, no directors serving concurrently as executive officers received compensation as directors. Total
compensation for the five people serving concurrently as directors and executive officers is shown in the
Executive Officers and Group Executives line.
3. The amount of share component of compensation paid is calculated by multiplying the number of points
confirmed to be provided as the portion for the fiscal year ended March 2023 by the stock market pricepaid by the trust when ORIX’s shares were acquired (¥1,740.27 per share). Therefore, the total amount ofshare component of compensation actually paid in the fiscal year ended March 2023 is not presented.
The total amount of share component of compensation actually paid in the fiscal year ended March 2023
was ¥103 million for one director and one executive officer (including those serving concurrently as
directors and executive officers) who retired during the fiscal year ended March 2023.
4. ORIX did not provide stock options in the form of stock acquisition rights in the fiscal year ended March 2023.
5. Figures shown are rounded down by truncating figures of less than ¥1 million.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Execution of Operations Framework
Organization of Executive Officers

Execution of Operations Framework (As of June 30, 2023)

The representative executive officer of ORIX makes important

Nominating Committee

Management / Supervision
The Board of Directors

decisions on execution of operations after deliberations by theCompensation Committee
Audit Committee

Executive Committee and other bodies in accordance with ORIX’s
Delegation of execution

various rules.
The duties of executive officers are decided by the Board of
Directors and the representative executive officer and are carried out
in accordance with ORIX’s various rules. Group executives areappointed by the Board of Directors from among the directors andexecutive officers of the Group companies.

Execution of operations

Audit

ReportReportExecutive Committee(Organs responsible for
execution of operations)

Investment and Credit Committee

CEOand Executive Officers

Audit Committee
Secretariat

Cooperation
Disclosure Committee

Information Technology
Management Committee

Business Unit Strategy Meeting

Sustainability Committee

Group Executive Officer Committee

Execution

Business units

Internal control-related functions(including subsidiaries)(Departments in charge of Group management)Internal audit
department
Audit

Monitoring

Whistleblower channels

Members
Executive Body

Activities

Representative
Executive Officer

Executive
Officers

Group
Executives

Executive Committee• Deliberates on important matters related to the management of the Company.

○

○*

○*

Sustainability Committee• Deliberates on important matters related to promoting and implementing sustainability.

○

○*

○*

Investment and Credit Committee• Deliberates regarding investments and credit transactions that exceed certain specified investment or credit amounts.

○

○*

○*

Group Executive Officer Committee• Shares important information related to business execution of ORIX Group.

○

○

○

Business Unit Strategy Meeting• Deliberates on each business unit's strategies and changes in the business environment.

○○*

Information Technology Management Committee• D eliberates on important matters concerning fundamental policies and strategies for IT operations and implementation andmaintenance of IT systems.

○○*

Disclosure Committee• To ensure timely and appropriate disclosure of information material of ORIX Group, the Disclosure Committee receives reports onmaterial non-public information from persons in charge of ORIX Group company departments and takes steps necessary to determine
whether or not timely disclosure of such information is necessary, and the appropriate means of disclosing such information.

* Designated by the representative executive officer
Note: For details on ORIX’s execution of operations framework, please refer to the following:

Form 20-F filed with the U.S. Securities and Exchange Commission

Others

Officer responsible for theTechnology Department
Executive officers in charge ofmanagement departments engaged
in disclosure of material information| 61

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Management Team: Executive Officers and Business Unit Managers(As of August 31, 2023)

Makoto Inoue

Member of the Board of Directors, Representative
Executive Officer, President and Chief Executive
Officer, Responsible for Group Strategy Business Unit

Banking

Yuichi Nishigori

Representative Director and President,
ORIX Bank Corporation

Corporate Financial Services andMaintenance Leasing

Satoru Matsuzaki

Member of the Board of Directors, Senior Managing
Executive Officer, Head of Corporate Business
Headquarters, Chairman, ORIX Auto Corporation,
Chairman, ORIX Rentec Corporation

CreditHiroko Yamashina

Group Executive
Chairman, ORIX Credit Corporation
Audit & Supervisory Board Member (Outside),
Japan Tobacco Inc.

Corporate Financial Services

Tetsuya Kotera

Executive Officer
Deputy Head of Corporate Business Headquarters

CreditYasushi Okada

President, ORIX Credit Corporation

Corporate Financial Services

Eiji Arita

Executive Officer
Deputy Head of Corporate Business Headquarters
Outside Director, Kanamoto Co., Ltd.

Aircraft and Ships

Ryujiro Tokuma

Executive Officer
Head of Global Transportation Services
Headquarters
President, ORIX Maritime Corporation

Auto

Yuji Kamiyauchi

Group Executive
President, ORIX Auto Corporation
Director, Ubiteq, INC.

ORIX USA

Yoshiteru Suzuki

Senior Managing Executive Officer
President and Chief Executive Officer,
ORIX Corporation USA

RentecNobuhisa
Hosokawa

Group Executive
President, ORIX Rentec Corporation

ORIX Europe

Kiyoshi Habiro

Executive Officer
Responsible for ORIX Europe and Robeco Group
Chief Executive Officer, ORIX Corporation Europe N.V.
Chief Executive Officer, ORIX Corporation UK Limited

Toshinari FukayaGroup Managing Executive
President, ORIX Real Estate Corporation
President, DAIKYO INCORPORATED

Asia and Australia

Hao Li

Executive Officer
Responsible for Greater China GroupRE Investment andFacilities Operation

Toyonori
Takahashi

Executive Officer, Group Kansai Representative
Responsible for MICE-IR Office, Responsible forReal Estate Sales Department, Senior Managing
Executive Officer, ORIX Real Estate Corporation

Asia and Australia

Yoshiaki Matsuoka

Group Strategy Business Unit
Head of Global Business GroupRE Investment andFacilities Operation

Takaaki NitanaiGroup Executive
Senior Managing Executive Officer,
ORIX Real Estate Corporation

Shuji Irie

Member of the Board of Directors
Senior Managing Executive Officer
Head of Investment and Operation Headquarters

Seiichi Miyake

Executive Officer
Deputy Head of Investment andOperation Headquarters

ORIX Baseball Club,
Osaka City DomeMichio Minato

Executive Officer, Group Strategy Business Unit
President, ORIX Baseball Club Co., Ltd.
President, Osaka City Dome Co., Ltd.

Environment and Energy

Hidetake
TakahashiManaging Executive Officer
Head of Energy and Eco Services Headquarters
Director, Ubiteq, INC.

CEO’s Office, New Business

Nobuki Watanabe

Executive Officer
Group Strategy Business Unit
Responsible for CEO’s Office and New BusinessPresident, ORIX Capital Corporation

Insurance

Kazunori Kataoka

President, ORIX Life Insurance Corporation

Credit andInvestment Management

Ikuo Nakamura

Executive Officer
Group Strategy Business Unit
Responsible for Credit and Investment Management

Real Estate

PE Investment and Concession

PE Investment

Note: Please refer to the following for ORIX’s organization chart.
Organization

Other Officers| 62

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

Management Team: Executive Officers and Business Unit Managers

Other Officers (continued)
Enterprise Risk Management

Takashi Otsuka

Executive Officer
Group Strategy Business Unit
Responsible for Enterprise Risk Management

ORIX Corporation USA

Jeff Abrams

Group Head of Private Credit

Legal Function Unit

Stan Koyanagi

Member of the Board of Directors
Senior Managing Executive Officer
Global General Counsel
Responsible for Legal Function UnitNXT Capital Group, LLC

Ted Denniston

Co-Head and Senior Managing Director

Corporate Function Unit

Yasuaki Mikami

Member of the Board of Directors
Senior Managing Executive Officer
Responsible for Corporate Function Unit
Responsible for Work Style Reform ProjectNXT Capital Group, LLC

Joseph Lazewski

Co-Head and Senior Managing Director

Treasury, Accounting, Corporate
Planning, Investor Relations,and Sustainability

Hitomaro Yano

Executive Officer
Corporate Function Unit
Responsible for Treasury, Accounting, Corporate
Planning, Investor Relations, and Sustainability

Lument Real Estate Capital
Holdings, LLC

James Flynn

Chief Executive Officer

Corporate Legal Affairs

Tomoko Kageura

Executive Officer
Corporate Function Unit
Responsible for Corporate Legal Affairs

Boston Financial Investment
Management, L.P.

Gregory P.
Voyentzie

Chief Executive Officer

Human Resources,
Corporate Administration, andCorporate Communications

Tomohiko Ishihara

Executive Officer, Corporate Function Unit
Responsible for Human Resources, Corporate
Administration, and Corporate Communications
Responsible for Secretariat of the Board of Directors

RobecoKarin vanBaardwijk

Chief Executive Officer

Hiroyuki Ido

Executive Officer
Responsible for Group Internal Audit Department

ORIX (China) Investment Co., Ltd.

Guoping Liu

Chairman

ORIX Australia Corporation Limited

Reggie Cabal

Chief Executive Officer & Managing Director

Group Internal Audit Department

Global Management
Elawan Energy S.L.

Dionisio Fernandez
Auray

CEO

ORIX Leasing Singapore Limited

Joanne LiauManaging Director

ORIX Aviation Systems Limited

James Meyler

Chief Executive Officer

ORIX Capital Korea Corporation

Chung Sung-Yoon

CEO

Avolon Holdings Limited

Andy CroninChief Executive Officer

Thai ORIX Leasing Co., Ltd.

Ed Sirivallop

Managing Director and Co-CEO

ORIX Corporation USA

Gilbert Van Hassel

Group Head of Asset Management| 63

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATION

Strategies by Business
Segments

Units

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

This section presents strategies in each of ORIX’s businesses in light of opportunities,risks, and strengths. It also discusses our approach to sustainability.

Features

Page

Corporate Financial Services

Sales network throughout Japan. Provides optimal solutions for corporate customers as a core platform for Group sales.

Page 66

Auto

One-stop provider of every kind of automobile-related service. World leader in vehicles under management.

Page 67

RentecJapan’s largest equipment rental company. Provides equipment along with technology and expertise.

Page 68

RE Investment and Facilities Operation

Wide range of real estate expertise. Diversified operations encompass development, investment, asset management, andfacility operation.

Page 69DAIKYO

Development and brokerage of real estate and building maintenance and management, with a focus on condominiums.
No.1 in terms of cumulative number of condominium units supplied in Japan*1.

Page 70

PE Investment

Enhancement of investee corporate value through hands-on management that leverages the Group’s expertise and network.

Page 71

Concession

Operation of public facilities and other properties while public entities retain ownership. Kansai Airports operates three
airports*2 in Kansai.

Page 72

Environment and Energy

Environment and Energy

Development of renewable energy businesses globally. In Japan, we have built a value chain of collection and transportation ofwaste, intermediate waste processing, and recycling. We also operate biogas power generation facilities and landfills.

Page 73

Insurance

Life Insurance

A lineup of products that meet needs such as death insurance and medical insurance. Highly rated by customers andexternal parties.

Page 74

Banking

Decades of experience in real estate investment loans. Primarily Internet-based transactions, does not own branch or
ATM network.

Page 75

CreditOperations in the loan business, credit guarantee business, and mortgage banking business. Over 40 years of experience in
unsecured personal loans.

Page 76

Aircraft and Ships

Aircraft and Ships

Expertise in aircraft and ship leasing and asset management. One of the world’s largest aircraft leasing companies.

Page 77

ORIX USA

ORIX USA

Access to third-party capital in providing funding solutions to U.S. companies that encompass finance and business
investment.

Page 78

ORIX Europe

ORIX Europe

Robeco and several other brands in the asset management business. Robeco has extensive expertise in ESG investment.

Page 79

Asia and Australia

Asia and Australia

Primarily provision of financial services to local customers in Asian countries. Expanding PE investment in Greater China andSouth Korea.

Page 80

Corporate Financial Services
and Maintenance Leasing

Real Estate

PE Investment and Concession

Banking and Credit| 64*1 Calculated using Real Estate Economic Institute data as of December 2022.
*2 Kansai International Airport, Osaka International Airport and Kobe Airport.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 65

Segment Summary (Profits, Assets, ROA and Employees)
Five-Year Summary
Segment Profits (Billions of yen)Segment Assets (Billions of yen) /Return on Segment Assets (ROA) (%)
536.1
10,883.5

429.7

414.5

11,999.6

11,341.8

12,595.3

9,986.9

406.2

Corporate Financial Services andMaintenance Leasing

3.39%

Real Estate

311.3

2.90%

PE Investment and Concession

2.72%
2.36%

Environment and Energy
Insurance
Banking and Credit

1.73%

Aircraft and Ships
ORIX USA
ORIX Europe
2019.32020.32021.32022.32019.32023.3In the fiscal year ended March 2021, profits declined mainly in Real Estate, Concession, and Aircraft
and Ships (aircraft) due to the impact of the COVID-19 pandemic. In the fiscal year ended March
2022, we recognized a gain of ¥163.0 billion on the sale of Yayoi in Corporate Financial Services. In
the fiscal year ended March 2023, profits declined mainly in Insurance and ORIX USA, but postCOVID reopening and gains on sales in Real Estate and in Environment and Energy contributed toearnings. Profits increased year on year excluding the gain on sale of Yayoi in the previous fiscal year.

Fiscal Year Ended March 2023
Composition of Segment Profits Composition of Segment Assets
Overseas(Total: 35%)*1

11%

18%

12%

Total Segment
Profits

12%
13%¥406.2 billion

5%

6%
8%

9%

*1 Excludes overseas results in Environment and Energy

Note: 2023.3 denotes the fiscal year ended March 2023.

Asia and Australia

Assets at March 31, 2023 increased by ¥595.8 billion from the end of the previous fiscal year. The
main factors for the increase were new investments in PE Investment and a positive exchange rate
effect totaling ¥368.7 billion.

Segment Assets (Trillions of yen)/ROA*2 (%)

Number of Employees and Employee Composition by
Segment (%)
34,737
16%

6

12%

24%

4

5%

Total Segment
Assets¥12.6 trillion
16%22%2023.3

ORIX Europe

7%

1%

16%

2022.38

3%10%2021.3(%)

Overseas(Total: 32%)*1

9%2020.3

6%

Environment
and Energy
2

Insurance

7%

Asia and Australia
Banking and Credit

PE Investment and Concession
0

0.5

1.0

20%

Corporate Financial Services and Maintenance Leasing
ORIX USA

Aircraft and
Ships

0
-1

Real Estate

1.5

2.0

*2 Segment asset ROA is calculated using after-tax profits for each unit.

2.5

3.0 (Trillions of yen)Overseas(Total: 22%)*3

13%
6%

2%
4%
0.4%
4%
4%
Management departments*3 Total of four segments: Aircraft and Ships, ORIX USA, ORIX Europe, and Asia and Australia. Does notinclude management departments.

Five-Year Financial Data and Financial Highlights (2013.3 – 2023.3)

Segment Information

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUE

Business

Corporate Financial Services and Maintenance Leasing

Corporate Financial Services• Business succession needs among SMEs due to thelack of a successor

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 66

Leasing, financing, and various solutions (products and services) forsmall and medium-size enterprises
AI automaticallyorganizes random
document submissions.

Risks

Opportunities• Expanding assets and increasing earnings from fees
while maintaining profitability and credit quality

MANAGEMENT FOUNDATION

Strengths• Intensifying competition for corporate lending• Sales network rooted in each region of Japan• Adverse impact on customer performance due tohigh global inflation• Strong customer base built on a track record ofproviding financial services to SMEs

• Capital investment needs with the themes of DX and
ESG

Growth Strategy: Increase Sources of Earnings
Review of the Fiscal Year Ended March 2023
Finance revenues benefited from solid performance in our longstanding business oflending to small and medium-sized enterprises (SMEs), and the volume of loan
guarantee transactions with financial institutions increased. Services income grewsteadily as we accurately identified customer needs for supplementary support for
their core businesses, asset management, and business succession.

• We will grow finance revenues by developing an array of financial products that
require expertise. In addition to building our asset portfolio with non-recourse
real estate loans and other forms of structured finance, we will enhance ourmarket presence by providing the financing that our customers need to addressenvironmental change, including carbon neutrality and support for a shift todigital technology.
• We will grow services income by gaining a multifaceted understanding of thevarious issues our customers face to propose comprehensive services that
address them. We are a single source for a wide range of services to address anarray of issues encompassing supplementary support for our customers’ corebusinesses, asset management and business succession. Examples include thepower purchase agreement (PPA) model for third-party ownership of solar power
generation systems, real estate brokerage, M&A intermediation, and life
insurance sales.
See here for information on how we help to resolve social issues throughour business activities.

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
We focused on decarbonization support, business succession support, and thepreventive healthcare business. Decarbonization support featured solid PPA modeland solar panel sales. Our M&A intermediation services for business succession
support are fully developed, and we have frameworks in place to resolve various
business succession issues. In the preventive healthcare business, we opened a newmembers-only medical club in Tokyo to support health management among SMEs.

PATPOST is a service that uses proprietary AI-OCR technology to convert text
in images into text data and store documents in the cloud. The system can also
automatically convert information such as business partner records into digital
data simply by uploading various business documents such as invoices. Withmonthly fees starting at ¥980 per ID, PATPOST offers corporate customers
broad-based support in digitalizing and using data, and enables easy sortingand storage of documents in compliance with the revised Electronic Books
Preservation Act, which will go into effect in January 2024.

As a core platform for Group sales, we will create new ESG-related services thatmeet customer needs. We will also fully deploy our network in Japan in initiatives
to resolve social issues.
• We support business succession among SMEs and help local economies develop
and maintain and create employment. We also continue to strengthen ourframework for being a single source for services including M&A intermediation,
real estate brokerage, share transfer, and inheritance tax minimization.
• We help customers decarbonize by providing environmentally responsible power
supply services represented by the PPA model.
• Our preventive healthcare business helps to extend healthy life expectancy,
reduce medical expenses, and protect the ongoing integrity of Japan’s medical
insurance system. We support health management at SMEs with a focus on
preventive healthcare ser vices provided at newly established medical
examination centers.
• We invest in DX and ESG-related startups with the goal of creating new services
by supporting growth and collaboration.

Consolidated subsidiary CMC Corporation operates a members-only medical
service that provides SME founders and management professionals with agingrelated health management, including complete medical examinations using
high-precision diagnostic equipment. Established in March 2023, Central Medical
Club Setagaya has partnered with a clinic equipped with advanced diagnostic
imaging equipment such as PET-CT and MRI to provide examinations related tothe three major diseases of cancer, heart disease, and cerebrovascular disease.
In addition, CMC offers health support for SME management through services
that include daily health consultations.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

Corporate Financial Services and Maintenance Leasing

Auto

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESS

Risks

Strengths• Growth in mobility services, including the car rental
and car sharing markets, as the sharing economy and
MaaS become more prevalent• Decreases in revenue from existing businesses andservices and lower residual value of vehicles due tostructural changes in the automobile industry• Diverse service menu that enables us to provide
comprehensive and tailored service recommendations• Electric vehicle needs

Offer Convenience and Address Electric Vehicle (EV) Needs
Fiscal Year Ended March 2023 in Review
We concluded a business alliance with Ubiden, Inc. to expand the use of electricvehicle (EV) charging services among corporations. In addition to proposing vehicle
procurement using rentals and leasing and the installation of EV charging facilities,
we also provided single-source integrated management that included vehicle
maintenance and analysis of charging usage after installation.

• We will continue to grow with emphasis on expanding our customer base andstrengthening profitability. We will address changes in the business environmentand customer needs by adding new services related to vehicle management,EVs, and car sharing to enhance our revenue streams. In addition, we aim tofurther expand our customer base by strengthening our framework for being asingle source of customer services.
• In leasing, we will consider adding new services to meet new demands for adecarbonized society, compliance with laws and regulations, and work stylereform. In addition, we will establish a new value chain that encompasses the
migration to EVs, charging services, and the reuse and recycling of used vehicles
and batteries to accommodate the growing prevalence of EVs.
• In the rental car business, we aim to be the rental car company of choice byenhancing safety and security, contributing to decarbonization, and utilizing
digital technology.
• In car sharing, we will develop new stations, acquire new members, and improve
services, while considering the development of new sharing services.

ORIX INTEGRATED REPORT 2023

| 67

Leasing and rental of automobiles, car sharing, purchase andsales of used automobiles

Opportunities

Growth Strategy:

DATA• Global leader in terms of vehicles under management
and volume of vehicle data

Approach to Sustainability

Introducing EVs in and of itself is not effectively carbon-free. ORIX Auto aims
to create a system that can support customers in all phases of the automobile
lifecycle. Our capabilities range from vehicle migration support that provides therequired next-generation vehicles from a wide lineup, development of sufficientcharging infrastructure, energy management for electric power usage, andsupport for the transition to renewable energy, to sales of used vehicles andrepurposing of used batteries.

Fiscal Year Ended March 2023 in Review
We proposed transition to EVs to customers in partnership with Ubiden. Service
offerings capable of calculating customer CO2 emissions using data such as refueling
have now reached a systematic level of development. The percentage of rental car
outlets that have adopted green power consumption increased to 20%.

We will continue to provide services that help reduce both environmental impact
and traffic accidents. We will also promote and accelerate decarbonization in ourown facilities and businesses.
• We will create an environment that facilitates the transition to EVs for customers,
which will support expansion in vehicles under management.
• We will monitor the migration rate to next-generation HVs*1, EVs, and FCVs*2 inthe leasing, rental car, and car sharing businesses, with the goal of increasing
this rate by proactively proposing relevant vehicles.
• We will gradually transition ORIX-owned vehicles to EVs and increase the ratio of
next-generation vehicles to directly managed rental cars and car-sharing vehicles.
• We will develop vehicle management reports using vehicle operation data andprovide them as information services relevant to environment responsibility andsafe driving.
• Initiatives to reduce CO2 emissions will include using more green electricity atrental car outlets.
*1 Hybrid vehicles*2 Fuel cell vehicles

See here for information on how we help to resolve social issues throughour business activities.

Our initiatives to support customers include a capital and business alliance with
Ubiden, which operates the WeCharge EV charging service. WeCharge supports
all EVs and plug-in hybrid vehicles, and allows users to complete everythingfrom usage through payment with an app. ORIX Auto provides all customers
who are considering the transition to EVs with one-stop service, from theinstallation of EV charging facilities to subsequent charger use analysis, andalso supports efficient EV management operations. We will continue to help
customers resolve issues through such business alliances.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

Corporate Financial Services and Maintenance Leasing

RentecOpportunities

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAStrengths• Creating new business through collaboration utilizing
our customer base

• Reduced need for hardware due to equipment
downsizing and technological innovation• Accelerating use of technology to cope with labor
shortages, reform work styles, and implement
security measures• Soaring costs due to price increases

Robots operating on dedicated containers• Wide range of rental products and vendors• Technical ability to maintain and manage the qualityof rental equipment• Logistics service enabling next-day delivery• Broad customer network that includes large
manufacturers• Strong levels of corporate capital investment with afocus on digital technology

Warehousing and delivery of
ICT equipment near the port

Fiscal Year Ended March 2023 in Review
We opened our third technology center in Japan in Sagamihara City, Kanagawa
Prefecture, and significantly increased storage and maintenance capacity to meetbrisk demand for digital equipment and the need to flexibly deploy PCs according to
the flow of human resources.

• We intend to expand the number of ICT rental users by enhancing our
subscription model and increasing replacement flexibility. In addition, we willencourage rental use among medium-sized companies through collaboration
with PC vendors, system integrators*1, and distributors.
• I n the measuring instrument market, we will strengthen relationships with
communication equipment manufacturers and respond to demand related toresearch and development of next-generation standards (Beyond 5G) in the fieldof communication.
• In the 3D printer business, we will complement subscription 3D printing bypromoting DX among customers with the 3D-FABs modeling simulation for 3D
printing.
• We will consider developing platform services that leverage our customer base,such as providing a community that connects manufacturers, vendors and users;

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
In addition to cloud services for visualizing CO 2 emissions, we have begun
developing and providing products and services that promote the circular economy,
climate change mitigation, and technological innovation. These include measuring
instruments for wind power generation companies and fuel cell development
equipment.

AGV track attached to the port

The Sagamihara Technology Center opened in April 2023. This technical center
specializing in the storage and operation of ICT equipment is located in GLPALFALINK Sagamihara, one of Japan’s largest cutting-edge logistics centers withtotal floor space of more than 670,000m2. Its Autostore high-density robotic
storage system features world-class storage efficiency and its automatic guided
vehicles (AGVs) give this center about twice the processing capacity of theTokyo Technology Center.

We contribute to customer sustainability by providing technical knowledge andrental capabilities.
•W e will continue to develop products and services that promote a circular
economy, climate change mitigation, and technological innovation. We will also
consider linking our cloud service for visualizing CO2 emissions with reduction
solutions inside and outside ORIX Group. In addition, we will consider promoting
the introduction of rental equipment used in new technology research anddevelopment projects for GX*2.
•W
 e will formulate procurement policies that effectively incorporate ESG
perspectives.
*2 Green Transformation (GX): Innovations for using clean energy while minimizing the use of fossil fuels,
and measures to carry them out.

business matching among users and vendors; and consulting services and data
sales businesses that utilize customer data.
*1 A system integrator is a service provider that undertakes system development and operation on behalfof clients.

| 68

Rental and leasing of electronic measurement instruments and
ICT-related equipment

Risks

Growth Strategy: Become a Sharing Service Platform

ORIX INTEGRATED REPORT 2023

See here for information on how we help to resolve social issues throughour business activities.

We launched 3D-FABs in May 2023 as a service that automates 3D printing
simulations. Once the customer uploads 3D CAD data and specifies conditions,this simulation tool automatically responds using AI to judge whether printing
is possible, provides advice if printing is not possible, and estimates fees. This
service quickly provides conclusions, which helps customers realize their ideas
and shortens development lead time.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

Real Estate

RE Investment and Facilities Operation

CORPORATE GOVERNANCE•P ersonnel shortages at operating facilities and risingenergy and personnel costs• L ogistics facility needs due to expansion of the
e-commerce market•R eal estate investment market contraction due to thedeclining population in Japan•A ctive real estate brokerage market due to thegrowing inflow of funds into investment•R ising construction and equipment costs

Full Use of ORIX Group’s Network
Fiscal Year Ended March 2023 in Review
In the development and rental business, we invest in logistics facilities and rental
condominiums, and sell them for asset turnover. The facility operation business is
now returning to normal following the COVID-19 pandemic. Demand in Japan has
recovered first, and inbound tourism has been recovering since immigration
restrictions eased in October 2022. Assets under management are steadily
increasing in the asset management business, which generates stable earnings.

ORIX INTEGRATED REPORT 2023

| 69

Strengths•R ebound in demand for lodging as the COVID-19
pandemic subsides

Growth Strategy:

DATA

Development and rental of office buildings, commercial facilities,
logistics centers, and other properties; operation of businesses such as
inns, hotels, and aquariums, in addition to asset management

Risks

Opportunities

STRATEGIES BY BUSINESS• E xtensive expertise in the real estate business• I nformation volume and proposal capabilities thatfully leverage the Group’s network

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
We are upgrading to energy-saving equipment and increasing our use of renewableenergy as part of our plan to reduce CO2 emissions from portfolio properties in linewith ORIX Group’s carbon-neutral goal. In the facility operation business, we havecompleted the removal of specified single-use plastic products*1, completed theswitch from PET bottles to aluminum cans for drinking water provided in guest
rooms*2, and achieved food waste and loss reduction targets of 10% for the buffet
format and 3% for the course format*3.

Organic vegetables grownwith recycled compost

Beppu SUGINOI HOTEL in Beppu City, Oita Prefecture opened a second newguest room building called Sora Kan in January 2023. This property acquired
the highest CASBEE*4 building assessment certification rank of S and ZEB
Oriented*5 due in part to its deployment of energy-saving equipment and its
effective use of geothermal energy*6. This hotel has also structured its Food
Recycling Project, which uses inedible items from the buffet cooking process,customer leftovers and other food waste to make compost for growing its
own organic vegetables to serve at its restaurants. This approach reduces andrecycles food waste in cooperation with the community.
*4 A system that comprehensively evaluates the quality of buildings, including environmental
friendliness such as energy conservation and use of materials and equipment with low
environmental impact, as well as indoor comfort and consideration for the landscape.
*5 A certification system for buildings with a total floor area of 10,000 square meters orabove, in which measures are taken to achieve further energy conservation in addition to
the use of high-performance building envelopes and high-efficiency energy-saving facilities.
*6 The geothermal power plant is currently undergoing renovation and is scheduled to comeonline in October 2024.

*1 Completed at all 18 operating facilities. *2 Completed at 17 facilities.
*3 Achieved at all 14 hotel facilities.

• I n the development and rental business, we dynamically invest in logistics
facilities and rental condominiums that are in high demand. In particular, we have

We do business with a policy that prioritizes safety, security, and comfort as we

continued to develop logistics facilities, mainly in the Tokyo metropolitan area,

decarbonize in consideration of the environment and coexist with communities.

and had a pipeline of more than ¥100 billion as of March 31, 2023. Our

We provide products and services with sustainability in mind to help achieve afundamental business involves the cycle of development, leasing, and sale, andsustainable society.

we are also considering mid- to long-term holdings in the future.

•W e place importance on obtaining explicit third-party certification of the• In the facility operation business, we will invest in high-quality projects that weenvironmental performance, safety, and security of newly developed properties. We

can differentiate based on their location, our experience, and other factors. We

are also upgrading to energy-saving equipment and increasing our use of renewable

will improve brand recognition and strengthen our ability to attract customers

energy as part of our plan to reduce CO2 emissions from portfolio properties.

while enhancing our customer base. We will further promote community co-•O ur facility operation business provides environmentally friendly furnishings andcreation initiatives with the goal of adding value to facilities.
• In the asset management business, we will strive to increase assets undermanagement.
See here for information on how we help to resolve social issues throughour business activities.

is committed to reducing food waste and loss. We use locally sourced food andingredients, hire local people, and collaborate with tourism-related organizations
and local companies in initiatives to promote the appeal of the areas we serve.
Our inns and hotels prioritize the safety and security of guests and meticulously
ensure consistently excellent hygiene.

We have commenced the development of the Atsugi III Logistics Center, a large
multi-tenant logistics facility in Aiko-gun, Kanagawa Prefecture. The facility will
cover a vast area of 183,354.15m2, making it the largest property owned by
ORIX Real Estate. Furthermore, solar panels on the roof will supply renewableenergy to power the entire facility. The facility has obtained ZEB*7 certification,
which means that its annual primary energy consumption is effectively zero.
*7 Buildings in which primary energy consumption is reduced by 50% or more from thebaseline by introducing highly efficient equipment systems, etc., and in which primaryenergy consumption including the amount of energy from renewable energy sources isreduced by 100% or more.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

Real Estate

DAIKYOCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

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Development and brokerage of real estate and building maintenanceand management, with a focus on condominiums
A Single App for Condominium General Meetings
DAIKYO and ANABUKI
101
attendees

101 attendees (local)
102 not submitted
103 not submitted
104 not submitted

VotingAggregate results(Proposal Number 5)

For
Against49 for
1 against

Condominium owners

Risks

Opportunities

Strengths•N eed to renovate or rebuild aging condominiums,
including large-scale redevelopment projects•R ising land prices due to intensifying competition forsite acquisitions•D evelopment expertise and brand recognition of THE
LIONS and SURPASS condominiums•M ore business opportunities from leveraging theGroup network•R ising construction and equipment costs•S table revenues from building management, rental
management, sales brokerage, repair work,
remodeling, etc. originating from the condominium
business

Growth Strategy:
Strengthen Each Business and Promote Digital
Transformation (DX) for Business Innovation and
Improved Efficiency
Fiscal Year Ended March 2023 in Review
The real estate development business benefitted from solid demand. Sales remained
strong as the prices of new condominiums rose. In April 2023, DAIKYO announced
THE LIONS rebranding. The real estate management business strengthened its
management system while keeping the number of facilities under management
constant. In the real estate brokerage business, transaction unit prices increased due
to rising prices for pre-owned condominiums and greater premium propertytransaction volume.

• The real estate development business will exercise discipline in purchasing selectproperties in prime urban locations for the condominium business,

Approach to Sustainability

Centralized aggregation of votes
from physical venue attendees
and online votes

A service for condominium residents, POCKET HOME
is the industry’s first*3 support system for the general
meetings of condominium management associations. In
addition to condominium online conference functions forgeneral meetings, a total of six functions are available
including AI-based home assessment, inquiries via LINE,
FAQ, applications for various procedures, and notices.
We provide the app free of charge to about 540,000
condominium units nationwide that DAIKYO ASTAGE
and ANABUKI COMMUNITY manage.
*3 Survey by DAIKYO ASTAGE and ANABUKI COMMUNITY*1 N et zero energy house. Refers to housing that aims to keep the balance of annual energy
consumption to zero or less by conser ving energy with outstanding thermal insulation
performance and the use of highly efficient facilities, and by creating energy with solar power
generation. ZEH-M Oriented refers to condominiums that reduce primary energy consumption by
20% or more from the baseline value.
*2 Excludes condominium showrooms in pre-existing buildings and joint venture projects for which
neither DAIKYO nor ANABUKI CONSTRUCTION is the electricity supply and demand contractor.

We do business with a policy that prioritizes safety, security, and comfort as we

also proactively participate in redevelopment projects.

decarbonize in consideration of the environment and coexist with communities.

• In the real estate management business, we will increase the number of facilities

We provide products and services with sustainability in mind to help achieve a

we manage under contract and expand orders for repair work while adding

sustainable society.

options and orders for ancillary work from those facilities. In addition, we will

• We will use ZEH-M Oriented specifications in developing condominiums as thebasis for reducing the energy consumption of properties.

• I n the real estate brokerage business, we will improve profitability byhandling a greater number of premium properties when brokering purchaseand resale and retail transactions.

Attend the general meeting online
Exercise voting rights electronicallyusing the voting button

Fiscal Year Ended March 2023 in Review
We are developing condominiums that are ZEH-M Oriented*1. The Ministry of theEnvironment selected three of our projects for its fiscal 2022 Mid- and High-Rise
ZEH-M Support Project. We also decided to install EV charging outlets as a standard
specification for the parking lots of the condominiums we will develop in the future. All
condominium showrooms*2 of DAIKYO and ANABUKI CONSTRUCTION effectively
switched over to renewable energy. The head offices of DAIKYO and ANABUKICONSTRUCTION and the Kyoto head office of ORIX Facilities effectively switched overto renewable energy.

complemented by initiatives to deliver value that empowers rebranding. We will

promote business innovation and improved efficiency through DX.

Attendance response(including proxy submissions andexercise of voting rights)

See here for information on how we help to resolve social issues throughour business activities.

Lions Senbayashi Omiya Residence (Osaka City, Osaka Prefecture) is the first
condominium in Kansai*4 to be certified as High-Rise ZEH-M Ready*5. Solar
power generation complements high-performance thermal insulation and highefficiency equipment to reduce primary energy consumption for the entire
residential building by 56%.
*4 Survey by DAIKYO.
*5 Condominiums that meet requirements such as reinforced exterior insulation standards
and reduction of primary energy consumption, including renewable energy, by 50% to75%.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

PE Investment and Concession

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 71

Private equity investment

PE Investment(Left)
Shinichi Oe
Representative Director
and President

Opportunities

Risks

Strengths•B usiness succession needs and an increase incarve-outs, privatization, and other deals involving
listed companies• E xits at lower prices than expected and other issues
resulting from the emergence of risks and investee
underperformance because of poor due diligence• I ncreasing investment opportunities due to significant
changes in industry structure from digitalization, andaccelerating industry reorganization•S oaring acquisition prices due to the competitiveenvironment•A bility to add value with a hands-on approach thatenhances management and administration systems
and leverages synergies with ORIX Group’s sales
network and products

Growth Strategy:
Expansion in Focus Industries and Synergy with
Existing Businesses
Fiscal Year Ended March 2023 in Review
We exited from NET JAPAN Co., Ltd., a major precious metal recycling company
acquired in 2014, and invested in HEXEL Works, Inc., a comprehensive electricalequipment construction business for housing complexes, and DHC, a major
cosmetics and health food manufacturer. We are also considering investment inToshiba, led by Japan Industrial Partners, Inc.

• F lexibility about deal flow because ORIX invests its
own capital

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
Initiatives to reduce CO 2 emissions among investees included updating aging
equipment, improving air conditioning energy efficiency, and switching to low CO2
emission power plans.

We are committed to management for sustainability among investees as a means
to improve corporate value.
• We recognize the importance of reducing CO2 emissions among investees, andengage in collaboration by jointly devising relevant initiatives such as replacing• Key industries for our increased investment focus include healthcare, businessequipment and switching to renewable energy.

process outsourcing, IT and information services, as well as logistics and rental• E nhancing compliance and governance among investees is a priority. We

sectors. These markets are highly compatible with existing ORIX Groupemphasize optimized labor management and thoroughgoing fraud prevention andbusinesses, driving synergies, so ORIX will collaborate with its investees withthe goal of mutual success. We will also proactively promote investee roll-ups toexpand market share and add value to the services we provide.

safety management.

(Right)Yoshimasa Akutsu
Director(Senior Vice President,
Business Development
and Investment Group,
Investment andOperation Headquarters,
ORIX Corporation)

HC Networks, Ltd. (HCNET) is a network
integrator that provides synergistic services
such as network design, construction, andmaintenance. After investing in 2020, ORIX
leveraged the Group’s competencies in a
broad array of businesses to provide HCNET
with new growth opportunities, such as
requests for system reform project proposals,
joint development of new services, and theacquisition of subsidiaries to expand its service
lineup. The IT industry is a focus theme in our PE
investment business, with the aim of integrating
technology and practical application expertise.
(Left)
Shigeo Takatani
Chairman and CEO(Center)
Midori Miyazaki
President and COO(Right)Hiroyuki Odaka
Executive Vice President(Director, Business
Development andInvestment Group,
Investment andOperation Headquarters,
ORIX Corporation)• We focus investment on industries that contribute to resolving social issues. Our
goal is to contribute to the SDGs through the businesses in which we invest.

• W hile our focus has been on small and medium-size business succession
projects with an enterprise value of ¥50 billion or less, we will also focus on
doing carve-outs and privatization deals involving listed companies, aiming toincrease the enterprise value of these projects to ¥50 billion or more.
• Recycle capital by systematically replacing existing assets with superior assets.

See here for information on how we help to resolve social issues throughour business activities.

Addressing business succession needs, ORIX acquired all shares of DHC, amajor cosmetics and health food manufacturer, from its founders. DHC has bothbeauty and health businesses that contribute to wellness and has exceptional
brand recognition in Japan. We will support further growth by transitioning to
a new system while reforming the organization and mindset from top-down tobottom-up management; formulating and executing business strategies that
include international initiatives; and leveraging synergies with other healthcare
investments.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

PE Investment and Concession

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 72

Operation of airports and water businesses

Concession
Risks

Opportunities

Strengths• A potentially large market in Japan for renewal andmaintenance of aging infrastructure• Intensifying competition in domestic concession
projects• Extensive expertise and experience in business
operation• Infrastructure projects around the world• Change in policies regarding concession promotion
and change in laws and regulations• Solid network of relationships with leading companies
in and outside Japan• Negative effects such as decreased number ofpassengers due to infectious diseases

Growth Strategy:
Develop Markets with a Mid- to Long-Term Perspective
Fiscal Year Ended March 2023 in Review
Kansai Airports has maintained relationships with airlines and improved the flight
service environment to steadily benefit from the recovery in demand for international
flights as Japan relaxes the border controls that were in place to counter COVID-19.
A new domestic flight area is now in operation as the first stage of a large-scalerenovation of the Kansai International Airport Terminal 1 building to improve thecustomer experience and expand capacity.
In the water supply and sewage market, K.K. Mizumusubi Management Miyagi
began operating in April 2022 as the operating rights holder of the Miyagi Prefecture
Integrated Water Supply, Industrial Waterworks, and Sewerage Public-Private
Partnership Management Project.
In a new concession, we participated in Kawasaki City’s Todoroki Ryokuchi Park
Redevelopment, Operation, Etc. Project.

•E xisting concession projects: Kansai Airports will focus on renovations and digitaltransformation (DX) at Kansai International Airport in preparation for the recovery ofinternational flights and the Osaka Kansai Expo. Initiatives at a wastewater treatment
plant in Hamamatsu City, Shizuoka Prefecture and water businesses in Miyagi Prefecture
will focus on addressing rising energy costs. In our project for redevelopment andoperation of Todoroki Ryokuchi Park, our focus is on building an operating system.
• N ew concessions: We will continue to follow up on the many potential
concessions that are available and work toward commercialization based on our
expertise from participating in numerous bids and good relationships with partnercompanies in Japan and overseas.
• We will consider acquiring companies that have the expertise necessary tooperate infrastructure.

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
Kansai Airports implemented measures to reduce greenhouse gas emissions, suchas using renewable energy and hydrogen, reducing energy use for air conditioning
and lighting equipment, and introducing environmentally responsible vehicles. At
water supply and sewage concessions in Hamamatsu City and Miyagi Prefecture, weare reducing energy consumption and chemical use through intelligent maintenanceand management and KPI-based management to reduce environmental load.

• In April 2023, Kansai Airports launched a new environmental plan, Environmental
Vision 2050 and Environmental Goals 2030. The new plan encompasses
greenhouse gas emission reduction, resource recycling, environmental
monitoring, and biodiversity. We have set specific goals for 2030 as milestones
for achieving our long-term vision and goals, centered on decarbonization, circular
economy, and environmental symbiosis.
• A t water supply and sewage concessions in Hamamatsu City and Miyagi
Prefecture, ORIX is proactively involved in building a circular economy andsustainable local communities. We are committed to preserving water quality,
preventing air pollution, controlling odors, conserving energy, reducing andrecycling sludge, and contributing to a society that reuses and recycles withmanagement that includes voluntary standards that are more rigorous than
relevant laws and regulations.

See here for information on how we help to resolve social issues throughour business activities.

Kansai Airports is fully committed to supporting the Kansai economy byoperating three airports*. It will steadily make investments required for future
growth, including large-scale renovations at Kansai International Airport toexpand international flight capacity.
* Kansai International Airport, Osaka International Airport, and Kobe Airport.

ORIX is a member of the communities it serves, and is committed to supporting
their development. Our water supply and sewage concessions conduct classes
on sewage in Hamamatsu City for elementary school students and sponsor
the Mizumusubi Festival in Miyagi Prefecture to help people learn about themechanisms and role of wastewater treatment and community issues.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

Environment and Energy• Persistently high interest rates• Rising customer awareness of environmental value inareas such as decarbonization and the transition to a
recycling-oriented economy• Supply chain disruptions and material price hikes• Needs for advanced waste treatment and recycling,
and waste treatment needs among local governments• Policy and legislative changes related to theenvironment and energy• Shutdowns due to accidents at large-scale facilities
and natural disasters

Expand the Value Chain and Global Operations
Fiscal Year Ended March 2023 in Review
We added to our 80% stake in Elawan Energy in Spain, ORIX’s strategic platform fordeveloping renewable energy businesses globally, to make it a wholly owned
subsidiary in February 2023. This further strengthened our foundation in theinternational renewable energy business.
We developed storage stations that have large storage batteries connected to thepower grid, which contributes to power grid stability. We participated jointly with Kansai
Electric Power Co., Inc. in the Ministry of Economy, Trade, and Industry’s 2021
framework to support installation of grid-use storage batteries to accelerate the adoptionof renewable energy, which is administered by the Sustainable Open Innovation Initiative.

• In the domestic energy market, we aim to provide high-value-added services as a onestop service provider of renewable energy by combining multiple services including
electric power retail and energy saving as well as renewable energy, and by building avalue chain that covers the development, operation, and sale of power sources.
• Internationally, we will use our strategic platform to expand and diversify ourportfolio. This will include expansion into regions we do not yet serve, such as
Europe and North America; diversification into power storage stations, offshore wind
power generation, and other power sources; and development of next-generationenergy. We will also sell certain assets as part of our capital recycling program.
• In the domestic environmental market, our strengths include a broad array ofrecycling items, the establishment of networks, and our high-added-value
processing capabilities. We will step up the further expansion of our value chain
toward a society that reuses and recycles.

DATA

ORIX INTEGRATED REPORT 2023

| 73

Strengths• Expansion of the global renewable energy market

Growth Strategy:

STRATEGIES BY BUSINESSRenewable energy in Japan and overseas, electric power retail,energy-saving services, sale of solar panels andelectricity storage systems, recycling andwaste management, and resource recycling

Risks

Opportunities

CORPORATE GOVERNANCE• Comprehensive capabilities from operating multiple
energy businesses in Japan• Global business operations• One-stop service from waste collection andtransportation to final disposal

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
We expanded our renewable energy business in Japan and around the world whileconsidering ways to decarbonize our coal-biomass co-fired power plants by using
different fuels. We also expanded installed capacity* in operation to 3.7 GW from 3.3
GW in the fiscal year ended March 2022.
ORIX Eco Services helped to support a society that reuses and recycles byinitiating and growing new businesses with high added value, such as a businessthat recycles the blister packaging sheet materials used for packaging tablets andother applications, and a business that reuses and recycles solar panels.

ORIX owns 100% of the outstanding shares of Elawan Energy, a global renewableenergy company based in Spain. Elawan Energy develops and operates windand solar power generation plants in 14 countries, mainly in Europe, North
America, and South America. It operates power generation facilities with a total
installed capacity of 1,360 MW (as of March 31, 2023) and has a total of 11 GW
of projects in operation, under construction, or in development. Elawan Energy’s
strength is its functional expertise in handling all aspects of projects fromdevelopment to operation, and it is positioned as a strategic platform for ORIX to
expand its renewable energy business globally in the future.

*Adjusted for factors including ORIX’s equity stake in subsidiaries and affiliates in Japan and overseas.

We are working toward a sustainable society through businesses that contributeto a decarbonized society that reuses and recycles.
• We will expand the renewable energy business globally because it contributes toa decarbonized society. Outside Japan, we will grow our business using Elawan
Energy as a strategic platform. In Japan, we will promote the nationwide use of
the PPA model for third-party ownership of solar power generation systems.
• We will expand businesses that recycle and properly dispose of waste because
they contribute to a society that reuses and recycles.
• We will study and implement measures to reduce CO2 emissions at our two coalbiomass co-fired power plants by changing the equipment and fuels they use,
and will consider shutting down the plants if we determine that these cannot
reduce emissions by March 2030.
See here for information on how we help to resolve social issues throughour business activities.

In June 2021, ORIX Environmental Resources Management completed
construction of the Yorii Biogas Plant in Yorii-machi, Saitama Prefecture. This dry
biogas power generation facility with a capacity of 1.6 MW is one of the largest
in Japan that uses general waste. Commercial operation started in April 2022,
and the estimated annual power generation is 9.8 million kWh. This facility is
a waste-to-energy renewable energy power generation facility that ferments
general waste such as food and paper waste using methanogens to generatebiogas that fuels power generation. The operation of this facility will help
increase the food recycling rate of downstream businesses in the food industry.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

Insurance

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 74

Life insurance, including medical insurance and death insuranceLife Insurance
Risks

Opportunities

Strengths• Rising asset formation and lifetime security needsbrought on by an age of 100-year lifespans• Contraction of the domestic life insurance market due
to the declining population• Strong ability to develop products that address
customer needs• Increase in points of customer contact and expanded
opportunities to sell policies using an omnichannel
approach• Intensifying competition in the life insurance industry• Favorable recognition from third-party institutions

Growth Strategy:
Expand Customer Base and Advance Omnichannel
Strategy
Fiscal Year Ended March 2023 in Review
We launched new life insurance products with living benefits to meet the needs ofaging business owners, enhanced our omnichannel strategy and created new pointsof contact with customers, such as directly managed in-store insurance shops andonline face-to-face sales.

• We are expanding our customer base with products for older customers thatmeet retirement funding and inheritance needs, and with products targeting thecorporate market.
• We will take a multi-pronged approach to product development and shorten
development time to enhance the competitiveness of our products and ourability to offer them to customers.
• We will create new points of contact with customers with sales strategies thatleverage the characteristics of four sales channels: agency sales, sales byfinancial institutions, mail-order sales, and face-to-face sales by employees.
• We will enhance the customer experience by increasing operational efficiency
and digitalizing to increase opportunities to sell policies.

• Omnichannel business development

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
We formulated the ORIX Life Sustainability Policy in December 2022 and identified
five material issues (materialities); formulated asset management screening
standards that take ESG into consideration; and calculated GHG emissions of theinvestment portfolio.

We redesigned our core medical insurance products CURE Next and CURE
Lady Next as an initiative to provide security through the insurance businessto people of all generations in the age of 100-year lifespans, and began selling
the redesigned products on April 2, 2022. The redesigned products feature
affordable insurance premiums and enhanced coverage for the three majordiseases of cancer, heart disease, and cerebrovascular disease.

Based on the ORIX Life Corporate Philosophy, ORIX Life Insurance has formulateda Sustainability Policy that clearly states its basic approach to contributing tosolving social issues through its life insurance business, and identifies five material
issues (materialities). By working to resolve these important issues based on thispolicy, we will contribute to the realization of a sustainable global environment andsociety for future generations.
ORIX Life Insurance’s Material Issues (Materialities)• To provide security through the insurance business to people of all generations
who will live in the age of 100-year lifespans.
• To realize a sustainable society through the promotion of responsible investment
as an institutional investor.
• To build mutually beneficial relationships with business partners.
• To create an environment in which each and every employee can maximize his or
her potential in various situations.
• To strengthen corporate governance for sustainable growth.
See here for details on initiatives for each material issue.
See here for information on how we help to resolve social issues throughour business activities.

We conduct ESG investment that reflects environmental, social, andgovernance issues in order to realize a sustainable society through thepromotion of responsible investment as an institutional investor. One key
initiative is to help achieve a sustainable society through thematic investment
in renewable energy assets, green bonds, sustainable bonds, and the like after
considering risk and return.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

Banking and Credit

Banking
Opportunities

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 75

Real estate investment loans, corporate loans, consumer finance,
and trust business

Risks

Strengths• Growing demand for funding for corporate
sustainability initiatives• Contraction in the core real estate investment loan
market due to persistently high real estate prices• High profitability from efficient operations withdemonstrated strength in clearly defined markets• Diversifying customer needs for asset management
and administration, and increasing ESG investment
requirements• Rise in market volatility and emergence of credit risk
associated with interest rate and price hikes andmonetary policy trends• Able to provide diverse products and services using
trust banking functions• Strategic asset deployment that captures diverse
needs

Growth Strategy:
Expand into New Strategic Markets and Enhance Cash
Flow from Asset Securitization
Fiscal Year Ended March 2023 in Review
The core real estate investment loan market remained strong, and we promoted theproliferation of environmentally responsible real estate through loans. We alsoemphasized financing in strategic markets such as renewable energy and logistics. In
addition, our asset securitization business generated cash flow from loan assets
after identifying relevant investor requirements. Moreover, our investment in Digital
Securities Preparatory Co., Ltd. and the launch of a fully automated asset
management service have enabled us to offer asset management options for both
institutional and individual investors.

• Our real estate investment loan business will maintain a target market share
while ensuring soundness by carefully screening projects. We will also facilitate
the proliferation of environmentally responsible real estate.
• We will originate loans in designated strategic sectors that will underpin asustainable society. We will also enhance our asset securitization business by
deploying our trust functions to commercialize products that address the asset
management needs of investors.
• We are targeting sustainable growth and higher ROA while appropriately
controlling the quality and volume of assets.

See here for information on how we help to resolve social issues throughour business activities.

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
With sustainability as the cornerstone of management, we promoted initiatives that
contributed to resolving social issues. In the real estate investment loan business,
we increased financing for the development of investment condominiums with ZEH*1
specifications, and also financed an apartment building with ZEH specifications. In
addition, we diversified financing for renewable energy from solar power generation
to new markets. In November 2022, we issued our first sustainability bond to fundthese new types of projects. We also digitalized operations and introduced a new
personnel system to reform work styles.

Creating sustainable cities and communities is one of the material issues(materialities) of ORIX Bank’s Sustainability Policy. Complementing financing forcompanies that develop environmentally responsible properties, in September
2022 we provided our first financing package for an individual investor topurchase a Nearly ZEH-M*2 investment apartment building. We will continue tofacilitate the proliferation of environmentally responsible real estate to achieve asustainable society.
*2 N early zero energy mansion. A housing complex that complies with Nearly ZEH-M
regulations and reduces standard primary energy consumption by 75% or more throughenergy conservation and generation.

*1 N et zero energy house. Refers to housing that aims to keep the balance of annual energy
consumption to zero or less by conserving energy with outstanding thermal insulation performanceand the use of highly efficient facilities, and by creating energy with solar power generation.

In accordance with ORIX Bank’s material issues (materialities), we will provide
products and services that help resolve social issues, and implement initiatives tobe a sustainable company.
ORIX Bank’s Material Issues (Materialities)
1. Creating a sustainable economy and society:– Responding to an aging society– Regional revitalization– Realizing a smart and resilient society
2. Building safe and secure homes and lifestyles:– Creating sustainable cities and communities– Resolving urban issues
3. Realizing a society in harmony with nature:– Responding to climate change– Creating a recycling-oriented society
4. Creating a work environment in which everyone can work comfortably:– Diversity and inclusion– Human resource development and self-realization

ORIX Bank incorporates sustainability in its corporate management andpromotes work style reform and digitalization. To date, we have expanded our
personnel system to empower flexible work styles for our employees, and wehave also created a hardware environment that facilitates working from homethrough digitalization and paperless work. We have renovated all floors of thehead office building and created an office environment that can accommodate
both telework and on-site work with the goal of improving employee
productivity, encouraging job satisfaction, and creating new value.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

Banking and Credit

CreditCORPORATE GOVERNANCE

DATA

ORIX INTEGRATED REPORT 2023

| 76

Consumer finance, guarantees of unsecured loans handled by otherfinancial institutions, and housing loans (Flat 35)

Risks

Opportunities

STRATEGIES BY BUSINESSStrengths• Rebound in consumer sentiment damaged by
COVID-19• Worsening economic environment (increase in
non-performing loans)• Brand strength in product development and sales
activities• Increased opportunities to attract customers bycollaborating with business partners• Intensifying competition in the consumer loan market
due to entrants from other industries such as fintech• Screening capabilities built over many years

A New Card

Choice of

Two
Types

to Go with
Our App!

• Changes in the business environment due to theinverted yield curve
Personal Loans

Growth Strategy:
Business Growth Geared to the Next Generation
Fiscal Year Ended March 2023 in Review
In the consumer finance business, the balance of installment loans turned aroundbecause we proactively promoted ORIX MONEY, which we launched in February
2022. In the credit guarantee business, the number of affiliated financial institutions
increased due to sales activities targeting regional financial institutions driven bysales offices throughout Japan. In the mortgage banking business, Flat 35
originations were stable and our market share expanded despite the downturn of theindustry as a whole due to changes in the interest rate environment.

• In the consumer finance business, we are working to build brand recognition for
ORIX MONEY and increase the balance of installment loans. We will also
leverage our brand power to acquire new-to-market customers and encourageborrowing among existing customers.

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
We have started offering environmentally responsible cardless products and digital
services, and have begun considering initiatives that help prevent multiple debts andpersonal bankruptcy.

ORIX Credit is actively promoting and marketing ORIX MONEY. This involves
improving customer convenience by using digital technology and enhancing UI/UX*, and we have begun complementing existing app-based products with cardbased products that meet customer needs. In addition, we aim to build mind
share through promotional activities such as TV commercials and establish aunique position within the consumer finance market.
*Providing an intuitive user interface (UI) and a satisfying user experience (UX).

We aspire to become a financial services company that is consistently able topropose products and services from the perspective of individual customers.
•W e will develop products for customers with needs that existing financial
services do not satisfy, including freelancers, non-Japanese nationals, seniorcitizens, and full-time housewives.
•O ur goal is to prevent individuals from incurring multiple debts and personalbankruptcy by deterring excessive lending and providing financial education toyoung people.

• In the mortgage banking business, we aim to rapidly attain a leadership positionin the industry through Flat 35 volume driven by targeted marketing at sales
offices throughout Japan. Concurrently, we intend to expand our lineup of
housing loan products to capture additional profit opportunities.

See here for information on how we help to resolve social issues throughour business activities.

We are promoting Flat 35 by strengthening sales and improving operational
efficiency in ways such as enhancing operational flow and accelerating
screening. In addition, we are expanding origination volume while strengthening
mortgage broker relationships and governance. We are also focusing on productplanning and development to provide a wide range of services that respond tochanges in the environment and the needs of the housing loan market.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONBusiness

Aircraft and Ships
Opportunities

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESS

Risks
Aircraft Business• Increased use of leasing among airlines and increase in
low-cost carriers• Greater demand for aircraft remarketing and asset
management• Decrease in passenger demand due to a global economic
slowdown, war, terrorism, or infectious diseases• Airline bankruptcies• Aircraft sourcing ability and high-quality asset
management services• Avolon’s business model of ordering from aircraft
manufacturers

Ship Business• Decrease in the volume of trade due to accelerating
protectionism caused by geopolitical risk (decrease involume of goods shipped internationally)• Decrease in investor demand due to a global economic
slowdown

Ship Business

Leverage Market Conditions to Generate Earnings
Fiscal Year Ended March 2023 in Review
Aircraft business: We actively replaced assets to benefit from the recovery inpassenger demand and considered multiple investments to expand thebusiness domain.
Ship business: We sold owned vessels before the market declines, selectively
provided financing, including sustainability linked loans, and invested in a venture
capital fund specializing in the maritime sector.

Aircraft Business• We continue to see potential in the passenger market amid ongoing recovery
from the impact of COVID-19. Targeting sustainable growth, we will observe
trends in the airline and leasing markets and investor demand while replacing
assets to improve the quality of our portfolio and expand the number of owned
and managed aircraft.
• We will leverage our strong affinity with Avolon to expand in the aircraft leasing
market.
Ship Business• We will properly assess the market for owned vessels as we recycle capital.
• We will complement our three core businesses of owned vessels, financing, andfee businesses by leveraging our 50 years of experience in the shipping businessto accelerate investment in sustainable shipping, digitally transformed shipping,and other growth markets.

| 77

Strengths

Aircraft Business

Growth Strategy:

ORIX INTEGRATED REPORT 2023

Leasing and asset management services for aircraft and ships

Aircraft Business• Increased logistics demand worldwide• Investment to decarbonize and digitally transformshipping

DATA

Ship Business• Ship operations and management (ORIX Maritime)• Diversified portfolio encompassing owned vessels,
financing, and fee businesses

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
Aircraft business: As of December 2022, 55% of Avolon’s portfolio consisted of
new models with good fuel efficiency, up from 50% in December 2021. Our goal is
to raise this ratio to 75% by 2025. All 258 aircraft on order are new models.
Ship business: We completed the sale of all eight owned vessels with substandard
environmental performance. We will not make new investments in vessels built prior
to the international environmental regulations* that went into effect in 2013.

We entered the aircraft finance leasing business in the late 1970s andestablished ORIX Aviation Systems Limited in 1991 to expand our aircraft
operating lease business. We also provide asset management services todomestic and foreign investors, and we own and manage 192 aircraft as ofMarch 2023. In addition, in 2018 we acquired a 30% stake in Avolon, the world’s
third-largest aircraft leasing company. Avolon had a fleet of 531 aircraft as ofMarch 2023.

*Fuel efficiency regulations for new ships.

Aircraft Business• Recognizing the strong social demand for reduced CO2 emissions in the airline
industry, we will provide supplementary support for meeting the emission
reduction targets of airline companies as an operating lease provider. We
therefore aim to increase the ratio of new models with good fuel efficiency in ouraircraft portfolio.
• We will consider investments and loans related to sustainable aviation fuel (SAF).
Ship Business• ORIX bases vessel ownership on specifications that improve fuel efficiency andreduce environmental impact. We have implemented a policy to exclusively
procure new ships that comply with international environmental regulations, andwe will not invest in ships built prior to the international environmental
regulations that went into effect in 2013.
• We will increase sustainability linked loans.
See here for information on how we help to resolve social issues throughour business activities.

ORIX began leasing pre-owned ships in Japan in the late 1960s, and our ship
finance business has been operating internationally since the early 1970s.
In 1977, we established Perseus Shipping Co., Ltd. (now ORIX Maritime) to
manage and maintain our ships. Most of our fleet is handy-sized bulk carriers
that we provide to major companies such as grain trading houses and powercompanies in Japan and overseas. We owned 10 bulk carriers as of March 2023.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUE

Business

ORIX USA• More financing opportunities as banks tighten lending• Credit losses due to deterioration of client company
performance• Decrease in investment and credit opportunities due
to reduced M&A activity

Deploy Assets On and Off the Balance Sheet
Fiscal Year Ended March 2023 in Review
We made our risk management system more rigorous, given the uncertain financial
and economic outlook in the Americas, and changed internal regulations andcommittees to grow the asset management business.

• ORIX Corporation USA (OCU) is an on-balance-sheet investor and lender as wellas an asset manager that deploys funds from external investors. It controls itsbalance sheet while expanding assets under management and fee businesses.
• OCU’s private credit, private equity, and real estate businesses provide financing
solutions for middle-market U.S. companies. We intend to expand asset
management ser vices while acquiring companies with relevant asset
management and operation capabilities.

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 78

Strengths• Persistently high interest rates

Growth Strategy:

CORPORATE GOVERNANCE

Finance, investment, and asset management in the Americas

Risks

Opportunities• Growth of assets under management as the asset
management market expands

MANAGEMENT FOUNDATION• Ability to offer various capital solutions tailored to the
middle market• Use of specialists with an intimate knowledge ofbusiness in their field

Approach to Sustainability
Fiscal Year Ended March 2023 in Review
OCU uses its own ESG scorecard*1 to assign ESG scores to all assets on its balance
sheet. A dashboard displays scorecard information to visualize and enable
management of ESG risks across the portfolio. We established an internal ESG
advisory body*2 to provide ESG advice on discrete investments and loans and on
OCU’s ESG strategy. We have also created a framework for developing impact
investment products.

Lakeview Pointe in Garland, Texas, is part of the affordable housing rental property
portfolio of ORIX USA subsidiary Boston Financial Investment Management, L.P.
The 132-unit property was recognized as the city’s first National Green BuildingStandardTM Certified project. This recognition confirms that Lakeview Pointe has
met the criteria set by the Home Innovation Research Labs and the National
Association of Home Builders, ensuring that the development is sustainable andenvironmentally responsible in design, construction, and operation.

*1 The ESG scorecard incorporates the framework of the U.S. Sustainability Accounting Standards
Board (SASB), and also adjusts risk weightings by industry sector.
*2 Called the ESG Advisory Group.

We believe that ESG-based investment decisions are essential to contributing tosociety, generating sustainable growth, managing risk, and maintaining the trust
and respect of our stakeholders.
• We will evaluate and monitor ESG scores and conduct annual reviews.
• We will improve the ESG scorecard to better contribute to ESG due diligence andengagement.
• We will identify indicators and exposures related to information disclosure basedon the TCFD recommendations, and monitor them as part of risk management.
See here for information on how we help to resolve social issues throughour business activities.

In November 2022, employees of ORIX USA and its subsidiary Lument
volunteered with Habitat for Humanity to paint and prime three hallways ofa residential cooperative building in New York City. This Build Day was partof a series of projects where employees contributed their time to help build
affordable housing for disadvantaged communities. As part of the 2022 fiscal
year Corporate Social Responsibility annual giving program, ORIX USA Group
donated $100,000 to Habitat for Humanity, supporting their mission to build safe
and affordable homes and communities in the U.S.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUE

Business

ORIX Europe• Increased M&A opportunities due to reorganizationof the asset management industry

CORPORATE GOVERNANCE

Fiscal Year Ended March 2023 in Review
Robeco: Assets under management decreased due to market downturn; focused on
expanding private debt business.
Boston Partners: Solid performance despite market downturn; began strengthening
distribution.
Harbor Capital: Assets under management decreased due to market downturn;began strengthening distribution.
Transtrend: Low correlation with the stock market, strong performance.

• ORIX Europe is strengthening sales and distribution and expanding assets undercustody in the areas it serves. We aim to expand the product line both organicallyand through M&A, depending on the prevailing opportunities. We see room to
expand in alternative investments such as real estate, infrastructure, and private
debt as well as in Robeco’s existing strengths in quantitative and sustainable
investment.
• Management fees for traditional stock and bond investment products are on the
decline. We will therefore ensure profitability by expanding the product lineup to
include alternative investments with comparatively high-margin fees.

| 79• Extensive experience backed by a long track record,
an excellent research system, and expertise in ESG
investingApproach to Sustainability

In 2022, Robeco launched its Sustainable Investment Open Access initiative todisclose its SDG scoring and biodiversity framework to investors and academia.
We aim to make Robeco’s sustainability framework a global standard byreceiving feedback and making improvements.

Fiscal Year Ended March 2023 in Review
Robeco: We achieved a 45.1% reduction in carbon emissions from investment andbusiness activities by the end of December 2022 in accordance with our Net Zero
Roadmap*1. We also created a framework based on our Biodiversity Roadmap*2 forevaluating contributions to biodiversity and established a biodiversity equity strategy.
*1 Announced in 2021.

*2 Announced in 2022.

Robeco• Our investment strategies will integrate ESG factors: (1) strategies that employ
ESG information in investment decisions; (2) strategies that focus onsustainability; and (3) impact investment strategies. In particular, we will focus on
expanding the balance of assets under management related to (3) impact
investment strategies.
• We will create an engagement policy and appoint experts to strengthen
engagement with governments and government-owned enterprises.
• In line with our Net Zero Roadmap, we will reduce carbon emissions from ourinvestment and business activities by 7% each year with the goal of achieving
net zero by 2050.
• In line with our Biodiversity Roadmap, we will implement initiatives for TNFD*3 testing
and the creation of biodiversity-related asset management industry standards.
See here for information on the approach to sustainability of Boston Partners Global
Investors, Harbor Capital Advisors, Transtrend, and Gravis Capital Management.

See here for information on how we help to resolve social issues throughour business activities.

ORIX INTEGRATED REPORT 2023

• Broad product lineup and investor base• Shift from active to passive management and risingpressure on fees

Step Up Marketing and Expand the Product Lineup

DATA

Strengths• Weakened investment management organization due
to an outflow of talented personnel

Growth Strategy:

STRATEGIES BY BUSINESSAsset management of global equity and fixed income

Risks

Opportunities• Inflow of funds into international ESG investing

MANAGEMENT FOUNDATION*3 Taskforce on Nature-related Financial Disclosures: An initiative launched in June 2021, TNFD
encourages organizations to assess and report risks and opportunities related to the naturalenvironment and biodiversity in their own economic activities.

Robeco has been at the forefront of sustainable investing ever since launchingits first sustainable investment product in 1995. In its Sustainability Report 2022,
Robeco summarizes how it integrates sustainability into its investments andbusiness activities, the sustainable investment solutions it offers its clients, andhow it implements active ownership activities.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUE

Business

Asia and Australia

CORPORATE GOVERNANCE

STRATEGIES BY BUSINESS• Local expertise and networks developed over thelong term• Political uncertainty in individual countries• Use of ORIX Group’s expertise in businessdiversification• New investment and loan opportunities for EVs andother next-generation technologies

Promoting Business Diversification
Fiscal Year Ended March 2023 in Review
We restored assets to pre-COVID level. The automobile leasing business is doing
especially well due to the significant increase in pre-owned car prices. We
strengthened information and expertise sharing among local subsidiaries to diversify
our business.
We focused on increasing the value of existing private equity investments andexplored the potential for selling them.

• We will implement strategies driven by market size, which encompasses thenational population and economy, as well as by market growth potential andcompetitive conditions. We will continue to expand our business lines through

ORIX INTEGRATED REPORT 2023

| 80

Strengths• Relatively high interest rates and exchange rate
volatility

Growth Strategy:

DATA

Finance and investment businesses in Asia and Australia

Risks

Opportunities• Strong potential for growth due to factors including
the expansion of the middle class in emerging Asian
countries

MANAGEMENT FOUNDATION

Approach to Sustainability

Shanghai Haichang Ocean Park is operated by the Haichang Group, a strategic
investee of ORIX’s Greater China Group. The Haichang Group develops andoperates aquariums and theme parks such as Sea Paradise in China. ORIX
invested in Haichang in 2009, and Haichang Ocean Park Holdings Ltd. listed on
the Hong Kong exchange in 2014.

Fiscal Year Ended March 2023 in Review
The balance of credit extended to industries with high environmental impact*1 at
subsidiaries in Malaysia, Indonesia, and Australia decreased on a local currency
basis compared to the fiscal year ended March 2020. In Malaysia, we set a target
ratio of RSPO and MSPO*2 certified companies to the outstanding balance of credit
to palm oil plantation operators. We have established a review system, and havereviewed all cases.
In Greater China, we promoted green finance that encompasses leasing
associated with solar power generation, electric vehicles, electric forklifts, andenvironmental resource recycling equipment. We have begun to consider GHG
emission calculation methods for investees.
*1 Fossil fuel mining, palm oil plantations, and forestry.
*2 R
 SPO is an international certification for sustainable palm oil, and MSPO is a certification from the
Malaysian government.

both financing and investment, with the aim of business diversification.
• Diversification will involve creating investment and business opportunities with a• Subsidiaries in Malaysia, Indonesia, and Australia will reduce the balance of credit

network that leverages the skills and expertise of our people in-market toextended to industries with high environmental impact by 50% through 2030

improve our presence in Asia and Australia.

compared to 2020.
• We will support ESG initiatives among existing private equity investees in Greater
China.
See here for information on how we help to resolve social issues throughour business activities.

In 2020, ORIX Australia began leasing SEA Hino 917 EV carbon-free electrictrucks produced by SEA Electric*3 to a major New Zealand company that is in
the road and airport infrastructure construction and maintenance business. The
world’s first electric truck, the SEA Hino 917 EV has a power system with abattery capacity of 100 kWh and a maximum range of 275 km (unloaded) on asingle charge. Lessees also consider this to be a key initiative aligned with their
management philosophy of providing sustainable infrastructure development.
*3 S EA Electric is a global automotive technology company that specializes in building
100% electric powered vehicles that do not rely on fossil fuels.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUE

Data

ESG Data

82

Eleven-Year Summary of Consolidated Financial Data

86

Consolidated Balance Sheets

87

Consolidated Statements of Income/Consolidated Statements of Comprehensive Income

88

Breakdown of Assets and Revenues by Segment

89

Group Companies

91

Corporate Profile/Stock Information/Investor Memo93

MANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 81

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

ESG Data
Environment
ORIX Group’s GHG Emissions(Unit: t-CO2e)

Third-Party Assurance

FY ended March 2019 FY ended March 2020 FY ended March 2021 FY ended March 2022 FY ended March 2023
Scope 1

907,345

1,138,566

987,771

1,044,892  981,519

Scope 2

146,469

112,444

151,055  151,980  139,766

1,053,814

1,251,010

1,138,826

1,196,872

1,121,285

Scope 1 & 2 Total

Scope 1 (Direct GHG emissions occurring from sources that are owned or controlled by the Company (fuelconsumption, industrial processes))
Combustion of fuels including fuel oil, diesel, gasoline, city gas, coal, biomass, and waste, use of limestone for desulfurization treatment

 cope 2 (Indirect GHG emissions from purchased energy consumed by the Company (electricity use, heat, andS
steam))
Electricity use and heat (steam, cold water, warm water)

Scope and Method
Calculation Period
From April 1 to March 31 each fiscal year

Boundary
Through FY ended March 2020: Consolidated ORIX Group companies in Japan (excluding investees in our PE Investment business)
FY ended March 2021 onwards: Consolidated ORIX Group companies (Japan and overseas, excluding a limited number of overseas offices as well as
entities which were consolidated in the last quarter of the fiscal year ended March 2023)

Target Activities
GHG Protocol direct emissions (Scope 1) and indirect emissions (Scope 2)

Calculation Method• GHG emissions (converted to CO2) are calculated based on the GHG Protocol and the “Ministerial Ordinance Concerning Calculation of Greenhouse
Gas Emissions Associated with Business Activities of Specified Emitters” (calculated based on Group GHG calculation guidelines).
• GHG emissions, including CO2 from non-energy sources, methane (CH4), and dinitrogen monoxide (N2O), are calculated based on Company rules
concerning the management of environmental information.
• We use the emissions factors under Japan’s Mandatory Greenhouse Gas Accounting and Reporting System in principle.
•S cope 2 emissions are market-based emissions, and post-adjustment emissions factors are used as emissions factors related to electricity
consumption at offices in Japan. For emissions factors related to electricity consumption at overseas offices, power company-specific emission factors
are used when available, and otherwise the International Energy Agency’s CO2 emissions factors from electricity generation by country are used.
• Scope 2 emissions include emissions related to power purchases from ORIX Group power generation companies (intra-Group transactions).
Emissions related to power purchases (intra-Group transactions) for the fiscal year ended March 2023 were 7 thousand t-CO2e.

[Notes]• Change in emissions factors: Beginning from data for the fiscal year ended March 2022, we have changed the calculation for emissions related toelectricity consumption to the market-based method.
• Emissions from coal-biomass co-fired power plants: ORIX operates two coal-biomass co-fired power plants in Japan. One is Soma Coal and Biomass
Power Plant in Soma City, Fukushima Prefecture, which started operations in March 2018. The other is Hibikinada Coal and Biomass Power Plant in
Kitakyushu City, Fukuoka Prefecture, which started operations in December 2018. Each of these power plants has a total generating capacity of 112
MW. Emissions from these two plants for the fiscal year ended March 2023 were 793 thousand t-CO2e.

Third-Party Assurance
Since the fiscal year ended March 2017, we have continuously received independent assurance for our GHG emissions disclosure.
For the fiscal year ended March 2023, KPMG AZSA Sustainability Co., Ltd. has provided independent assurance for our GHG emissions.
( : Items subject to third-party assurance)

Independent Assurance Report
To the Representative Executive Officer, President and Chief Executive Officer of ORIX Corporation
We were engaged by ORIX Corporation (the “Company”) to undertake a limited assurance engagement of the environmental
performance indicators marked with ★ (the “Indicators”) for the period from April 1, 2022 to March 31, 2023 included in its
Integrated Report 2023 (the “Report”) for the fiscal year ended March 31, 2023.
The Company’s Responsibility
The Company is responsible for the preparation of the Indicators in accordance with its own reporting criteria (the “Company’s
reporting criteria”), as described in the Report.
Our Responsibility
Our responsibility is to express a limited assurance conclusion on the Indicators based on the procedures we have performed. We
conducted our engagement in accordance with the ‘International Standard on Assurance Engagements (ISAE) 3000, Assurance
Engagements other than Audits or Reviews of Historical Financial Information’ and the ‘ISAE 3410, Assurance Engagements on
Greenhouse Gas Statements’ issued by the International Auditing and Assurance Standards Board. The limited assurance
engagement consisted of making inquiries, primarily of persons responsible for the preparation of information presented in theReport, and applying analytical and other procedures, and the procedures performed vary in nature from, and are less in extent thanfor, a reasonable assurance engagement. The level of assurance provided is thus not as high as that provided by a reasonableassurance engagement. Our assurance procedures included:l Interviewing the Company’s responsible personnel to obtain an understanding of its policy for preparing the Report andreviewing the Company’s reporting criteria.
l Inquiring about the design of the systems and methods used to collect and process the Indicators.
l Performing analytical procedures on the Indicators.
l Examining, on a test basis, evidence supporting the generation, aggregation and reporting of the Indicators in conformity with
the Company’s reporting criteria, and recalculating the Indicators.
l Visiting ORIX Environmental Resources Management Corporation’s Yorii Biogas Plant and Hibikinada Energy Park LLC
selected on the basis of a risk analysis.
l Evaluating the overall presentation of the Indicators.
Conclusion
Based on the procedures performed, as described above, nothing has come to our attention that causes us to believe that the
Indicators in the Report are not prepared, in all material respects, in accordance with the Company’s reporting criteria as describedin the Report.
Our Independence and Quality Management
We have complied with the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for
Accountants, which includes independence and other requirements founded on fundamental principles of integrity, objectivity,
professional competence and due care, confidentiality and professional behavior. In accordance with International Standard on
Quality Management 1, we design, implement and operate a system of quality management including policies or procedures
regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.

/s/ Kazuhiko Saito
Kazuhiko Saito, Partner, Representative Director
KPMG AZSA Sustainability Co., Ltd.
Tokyo, Japan
September 21, 2023

Notes to the Reader of Independent Assurance Report:
This is a copy of the Independent Assurance Report and the original copies are kept separately by the Company and KPMG AZSA Sustainability Co., Ltd.

| 82

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 83

ESG Data

Scope 3 (Value Chain GHG Emissions) and ORIX’s Businesses (FY ended March 2023)
Businesses
CoveredAuto

CO2 Avoided Emissions through the Renewable Energy Business
Wind Power
Generation

Solar Power
Generation

FY ended March 2022

1,670,000

1,297,000

640,000

428,000

254,000

4,289,000

FY ended March 2023

2,155,000

1,425,000

477,000

406,000

198,000

4,661,000

GHG Emissions by Scope 3 Category

Leasing
RentalAircraft

Aircraft
and
Ships
Ships

Purchase

Use of leased and rented vehicles
MaintenanceTransportationof vehicles,

Sale of vehicles

Disposal of vehicles

Fuel and electricity use at franchise retail outlets

Purchase

Transportationof aircraftNew
manufacturing/purchase

Transportationof ships

Use of leased aircraftUse of ships, MaintenanceSale of aircraft

Disposal of aircraft

Sale of ships

Disposal of ships(Unit: t-CO2)

Geothermal
Power
Generation

Hydropower
Generation

Biomass Power
Generation

Total

Note: See here for details of the calculation scope and concept.

ORIX Corporation Water Usage and Waste Disposal Volume
Investment
andoperation

New development/
property acquisition

Real Estate
Condominiums

Environment
andEnergyPower
generation
Electricity
retailFinance

Loans
Bonds/stocks

Leasing to tenants
Procurement of foodproducts, etc.

, Renovation

Facility operations(Scope 1 and 2)

New development/
property acquisition

Fuel extraction – transportation

Sale

Dismantling and demolition

Water Usage

Disposal of foodproducts, etc.
Sale

Dismantling and demolition

FY ended March 2021

FY ended March 2022

FY ended March 2023

Water withdrawal

Approx. 197,000 m

3

Approx. 249,000 m

3

Approx. 273,000 m3

Rainwater

Approx.    7,000 m3

Approx.    2,000 m3

Approx.    2,000 m3

Water discharge

Approx. 197,000 m

3

Approx. 248,000 m

3

Approx. 272,000 m3

FY ended March 2021

FY ended March 2022

FY ended March 2023

173 tons

661 tons

302 tons

Power generation by other companies
In-house power generation (Scope 1 and 2)(Investees’ and borrowers’ Scope 1 and 2 emissions) × (ORIX’s investment and credit balance) ÷ (Investee and borrower’s total assets)

Waste Disposal Volume
Disposal volume

Note: See here for details of the calculation scope and method.
Notes to table(Note 1) Emissions:
Large*: 500,000 to 5,000,000 tons
Medium: 10,000 to 500,000 tons
Small: Less than 10,000 tons
(Note 2) Calculation period: Emissions from business activities for the fiscal year ended March 2023 are estimated in accordance with the
GHG Protocol.
(Note 3) Numbers in the table indicate Scope 3 categories.
* The number of aircraft sold in the fiscal year ended March 2023 increased as business activities recovered from the impact of the COVID-19 pandemic, and the
maximum figure for “Large” has consequently been changed from this fiscal year. However, only emissions in Category 11 of the aircraft business exceeded 3
million tons. Emissions from other businesses and categories remained in the same range for the fiscal year ended March 2022.

Scope 3 (Value chain GHG emissions) information for previous periods is disclosed in the following reports.
FY ended March 2022: Page 39 in Sustainability Report 2022
FY ended March 2021: Page 30 in Sustainability Report 2021

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 84

ESG Data

SocialEmployee Composition (ORIX Group consolidated)
Number of employees
By region
By genderJapan
Outside Japan*1
Male
FemaleAverage number of temporary staff

2019
32,411
24,6397,772
20,491
11,92020,768

Female Managers*6 (ORIX Corporation)
2020
31,23323,458
7,775
19,63011,603
19,8162021
33,15325,718
7,435
20,876
12,277
19,1942022
32,23524,738
7,497
20,33011,90519,0242023
34,73727,021
7,716
21,352
13,385
19,623

Data Concerning Employees*2 (ORIX Corporation*3)
Average age

Average years of service

Turnover rate*4

OverallMale
FemaleOverallMale
FemaleOverallMale
Female

42.9
44.6
40.7
15.6
15.9
15.1
4.4
5.7
2.6
42.6
40.9
1.6

Percentage of female employees
Percentage of mid-career employees
Percentage of foreign national employees

43.4
44.9
41.3
16.1
16.3
15.8
4.1
5.2
2.7
42.9
40.3
2.0

43.8
45.2
41.9
17.3
17.6
17.0
3.3
4.4
1.9
43.3
40.1
2.0

44.2
45.4
42.7
17.8
17.9
17.7
4.6
6.6
2.1
44.0
39.8
1.9

44.5
45.4
43.3
18.1
17.8
18.3
5.2
7.1
2.7
44.2
40.3
1.9

15.5
83.2
151.7
3.9

15.1
80.6
150.8
3.6

13.3
71.3
156.4
6.0

14.1
75.0
157.4
6.1

14.9
79.7
157.3
5.8

8,800,192

8,711,932

8,583,327

8,852,516

9,100,288

Working Hours and Leave Taken (ORIX Corporation)
Annual paid leave taken

Days taken
Percentage taken

Average monthly working hours
Average monthly non-statutory working hours

Compensation (ORIX Corporation)
Average annual salary (JPY)Pay Gap between Men and Women* (Ratio of women’s wages to men’s) (ORIX Corporation) (FY ended March 2023)
5

All employees
62.2%

Of full-time employees
61.8%

Of fixed-term and part-time employees
65.3%

Training (ORIX Corporation)
Annual total training hours
Annual average training hours per employee
Annual average training cost per employee (JPY)30,3698.1
96,67430,931
8.3
90,81042,022
11.3
55,52045,54812.5
67,28586,42924.0
98,646*1 Outside Japan: Total number of employees in four segments: Aircraft and Ships, ORIX USA, ORIX Europe, and Asia and Australia.
*2 Data Concerning Employees: Excluding executives.
*3 ORIX Corporation (non-consolidated): 2,937 employees, or 8% of consolidated group employees, as of the end of March 2023.
*4 Turnover rate: Includes retirees and employees transferred within ORIX Group.
*5 Pay Gap between Men and Women: In calculating the difference, seconded employees are counted as employees of the home company.

See here for human resources data other than the above for the consolidated ORIX Group companies and ORIX
Corporation, as well as for our 10 Group companies.

Female managers

Number of persons
Percentage
Percentage of newly appointed female managers

2019
418
23.8
32.0

2020
451
25.3
35.3

2021
474
26.2
35.3

2022
512
28.6
54.2

2023
529
29.8
50.0

634
39.9
71
98.6
76
96.2
100.0
95.2
100.0
97.7

637
40.2
53
110.4
49
63.6
—
92.3
100.0
97.2

723
45.1
60
92.3
54
76.0
100.0
97.0
—
96.6

749
46.8
59
111.3
52
83.8
100.0
94.4
100.0
100.0

767
48.2
61
107.0
61
91.0
100.0
97.0
100.0
97.0

18
37
0
0

25
47
0
1

14
35
0
1

14
40
0
1

17
45
0
0

126
31
42
44
9
40.4
42.0

127
42
31
40
14
35.4
42.5

127
35
33
47
12
35.4
46.4

101
21
19
51
10
28.7
60.3

147
30
14
84
19
22.4
70.0

86.6
na
na

87.7
3
0

88.7
1
0

89.1
2
0

91.8
3
0

Childbirth and Childcare (ORIX Corporation)
Working mothers
Female employees who tookchildcare leave*8
Male employees who took childcare
leave or special childcare paid time off*9
Percentage of employees
returning after childcare leave*10
Retention rate after return*11

Number of persons
Percentage*7
Number of persons
Percentage
Number of persons
Percentage
Male
FemaleMale
FemaleNursing Care (ORIX Corporation)
Number of employees who took
nursing care paid time off
Number of employees who took
nursing care leave

Male
FemaleMale
FemaleRecruiting (ORIX Corporation)
Total number of employees recruited
New graduates
Male
FemaleMid-career employees
MaleFemalePercentage of female recruits
Percentage of mid-career employees

Health and Safety (ORIX Corporation)
Percentage of employees who went through stress checks
Number of occupational accidents
Number of fatal accidents*6 Managers: Persons in the same office, in addition to section managers, who are equivalent to section managers in terms of job content and degree of responsibility,
regardless of their title or membership (however, this excludes the lowest ranks).
*7 Percentage of working mothers: Ratio of working mothers to total number of female employees.
*8 Female employees who took childcare leave: The ratio of the number of employees who gave birth in the previous fiscal year to the number of employees who tookchildcare leave in the previous fiscal year. The ratio may exceed 100% as the number of employees who took childcare leave includes the number of those who
newly took childcare leave in the previous fiscal year although they gave birth before the previous fiscal year but did not take childcare leave in that fiscal year.
*9 Male employees who took childcare leave or special childcare paid time off: Ratio of the number of male employees whose child was born in the previous fiscal
year to the number of employees who newly took childcare leave or special childcare paid time off in the previous fiscal year. The ratio may exceed 100% as thenumber of employees who took such leave or paid time off includes the number of those who newly took leave or paid time off in the previous fiscal year although
their child was born before the previous fiscal year but did not take leave or paid time off in that fiscal year.
Special childcare paid time off: A system that gives special paid leave days to employees who are raising infants under 12 months old who have not acquired
childcare leave. This system was introduced with the purpose of creating a workplace where all employees can work comfortably. It aims to do this by expanding
opportunities for male employees to participate in childcare and helping to raise awareness surrounding balance between work and family.
Number of male employees who took special childcare paid time off: (For the fiscal year ended March 2023) The number of employees who took special paid leavedays between April 2022 and March 31, 2023.
*10 Percentage of employees returning after childcare leave: (For the fiscal year ended March 2023) The percentage of employees who returned to work among
employees who reached the end of childcare leave in the fiscal year ended March 2023.
*11 Retention rate after return: (For the fiscal year ended March 2023) Percentage of employees still working as of March 2023 to the number of employees who
returned to work during the fiscal year ended March 2022.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 85

ESG Data

GovernanceInclusion in ESG Indices
As of July 2023, ORIX is included in the ESG indices below:

Number of Meetings Held, Attendance Rate, and Composition of the Board of Directors
FY ended March FY ended March FY ended March FY ended March FY ended March
2019
2020
2021
2022
2023

MSCI Japan ESG Select Leaders Index

Number of Board of Directors meetings held

8

9

8

9

8

Board of Directors meeting attendance rate

97%

96%

100%

99%

100%

Number of directors

12

12

12

11

11

S&P/JPX Carbon Efficient Index

6

6

6

6

6

50.0%

50.0%

50.0%

54.5%

54.5%

FTSE Blossom Japan Sector Relative Index

2

2

2

2

2

16.6%

16.6%

16.6%

18.1%

18.1%

Of which, number of outside directors
Ratio of outside directors
Of which, number of female directors
Ratio of female directors

MSCI Japan Empowering Women Index (WIN)FTSE Blossom Japan Index
FTSE4Good Developed Index
Morningstar Japan ex-REIT Gender Diversity Tilt Index

Number of Meetings Held and Attendance Rates of Committees
FY ended March FY ended March FY ended March FY ended March FY ended March
2019
2020
2021
2022
2023
Number of Nominating Committee meetings held

3

5

5

7

6

Nominating Committee attendance rate

94%

95%

100%

100%

100%

Number of Audit Committee meetings held

8

8

11

12

14

100%

96%

97%

97%

98%

Audit Committee attendance rate
Number of Compensation Committee meetings held
Compensation Committee attendance rate

4

6

4

4

4

100%

100%

100%

100%

100%

Amount of Tax Paid by Country
FY ended March 2022

FY ended March 2023

Country

Amount of tax paid
(Millions of yen)

Percentage
by country

Country

Amount of tax paid
(Millions of yen)

Percentage
by countryJapan

42,929

51.7%

Japan

162,667

86.9%

United States

22,725

27.4%

United States  7,294  3.9%

Netherlands

9,644

11.6%

China

  2,549  1.4%

Switzerland

1,476  1.8%

Spain  2,013  1.1%

Others6,255  7.5%

Others12,723  6.8%

Total

83,030100.0%

Total

187,246

100.0%

Note: The amount of tax paid is based on reports by country submitted to the tax authorities.

Page 58 Number of Meetings Attended and Attendance Rate for the Board of Directors and Committee Meetings in
FY Ended March 2023 (by Director)
Page 60 ORIX Shares Held (As of the Date of Submission of the Securities Report for the FY Ended March 2023)
Page 60 Compensation for Directors, Executive Officers, and Group Executives (FY Ended March 2023)

See the following pages for other data.
Initiatives We Support
Ratings and Scores by ESG Rating Agencies
Sustainability-Related Policies and DataINTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESS

Eleven-Year Summary of Consolidated Financial Data

DATA

ORIX INTEGRATED REPORT 2023

| 86

Years ended March 31, 2013 through 2023
(Millions of yen)

Financial Position:
Net Investment in Leases
Installment Loans
Investment in Operating Leases
Investment in Securities
Property under Facility Operations
Total Assets
Short-term Debt, Long-term Debt and Deposits
Long- and Short-term Debt
Debt/Equity Ratio Short-term Debt, Long-term Debt and Deposits/Shareholders’ Equity (Times) Short-term Debt and Long-term Debt/Shareholders’ Equity (Times)
Share of Long-term Debt (%)
ORIX Corporation Shareholders’ Equity
Shareholders’ Equity Ratio (%)
Revenues and Expenses:
Total Revenues
Total Expenses
Provision for Doubtful Receivables and Probable Loan Losses
Provision for Credit Losses
Income before Income Taxes and Discontinued Operations
Net Income Attributable to ORIX Corporation Shareholders
ROA (%)ROE (%)Per Share Data (Yen): Net Income Attributable to ORIX Corporation Shareholders:    Basic Earnings per Share    Diluted Earnings per Share ORIX Corporation Shareholders’ Equity per Share Cash Dividends
Segment:
Segment Profits
Segment Assets
Return on Segment Assets (ROA) (%)
Number of Employees

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

¥  989,380
2,691,171
1,395,533
1,093,668
218,697
8,435,193
5,556,330
4,477,743¥1,094,073
2,315,555
1,379,741
1,214,452
295,863
9,063,517
5,363,968
4,157,555¥ 1,216,454
2,478,054
1,296,220
2,846,257
278,100
11,439,874
5,701,356
4,413,976¥ 1,190,136
2,592,233
1,349,199
2,344,792
327,016
10,992,918
5,685,014
4,286,542¥ 1,204,024
2,815,706
1,313,164
2,026,512
398,936
11,231,895
5,753,059
4,138,451¥ 1,194,888
2,823,769
1,344,926
1,729,455
434,786
11,425,982
5,890,720
4,133,258¥ 1,155,632
3,277,670
1,335,959
1,928,916
441,632
12,174,917
6,423,512
4,495,771¥ 1,080,964
3,740,486
1,400,001
2,245,323
562,485
13,067,528
6,847,889
4,616,186¥ 1,029,518
3,670,784
1,408,189
2,660,443
491,855
13,563,082
7,041,887
4,724,102¥ 1,057,973
3,862,604
1,463,202
2,852,349
561,846
14,280,684
7,142,843
4,866,685¥ 1,087,563
3,877,602
1,537,178
2,940,858
620,994
15,289,385
7,964,864
5,718,519

3.4
2.7
91
1,643,596
19.5

2.8
2.2
93
1,919,346
21.2

2.7
2.1
94
2,152,198
18.8

2.5
1.9
92
2,310,431
21.0

2.3
1.7
93
2,507,698
22.3

2.2
1.5
93
2,682,424
23.5

2.2
1.6
93
2,897,074
23.8

2.3
1.5
93
2,993,608
22.9

2.3
1.6
93
3,028,456
22.3

2.2
1.5
91
3,304,196
23.1

2.2
1.6
91
3,543,607
23.2¥1,052,477
901,624
10,016—
172,572
111,909
1.33
7.4¥1,375,292
1,172,244
13,838—286,339
187,364
2.14
10.5¥ 2,174,283
1,917,454
11,631—
344,017234,948
2.29
11.5¥ 2,369,202
2,081,461
11,717—391,302260,169
2.32
11.7¥ 2,678,659
2,349,435
22,667—424,965
273,239
2.46
11.3¥ 2,862,771
2,526,576
17,265—435,501
313,135
2.76
12.1¥ 2,434,864
2,105,426
22,525—395,730
323,745
2.74
11.6¥ 2,280,329
2,010,648
24,425—412,561
302,700
2.40
10.3¥ 2,292,708
2,033,894—
16,021
287,561
192,384
1.44
6.4¥ 2,520,365
2,213,711—
3,939
509,447
317,376
2.28
10.0¥ 2,666,373
2,327,375—
7,756
392,178
290,340
1.96
8.5¥   102.87
87.37
1,345.63
13.00¥   147.75
143.201,465.77
23.00¥    179.47
179.21
1,644.60
36.00¥    198.73
198.52
1,764.34
45.75¥     208.88
208.681,925.17
52.25¥    244.40
244.152,095.64
66.00¥    252.92
252.702,263.41
76.00¥    237.38
237.17
2,386.35
76.00¥    155.54
155.392,487.77
78.00¥    263.72
263.42
2,768.72
85.60¥    245.98
245.65
3,027.93
85.60¥  195,366
7,031,316
1.60
19,043¥  310,320
7,491,827
2.58
25,977¥   328,556
9,458,077
2.77
31,035¥¥¥¥   414,472
9,986,916
3.39
32,411¥   429,698
10,883,545
2.90
31,233¥   311,286
11,341,789
1.73
33,153¥   536,056
11,999,584
2.72
32,235¥   406,233
12,595,338
2.36
34,737

391,874
9,237,950
2.78
33,333

Notes: 1.	Cash dividends represent the amount of dividend per share for the corresponding fiscal year.
2.	Balance sheet data and income statement data have been changed beginning in the fiscal year ended March 2015. The amounts in the previous years havebeen retrospectively reclassified to reflect this change.
3.	During the fiscal year ended March 2015, we eliminated the accounting period gap that previously existed between DAIKYO and ORIX. The amounts in theprevious years have been retrospectively reclassified to reflect this change.
4.	From the fiscal year ended March 2017, FASB Accounting Standards Update No. 2015-03 (Interest-Imputation of Interest (Subtopic 835-30): Simplifying the
Presentation of Debt Issuance Costs) has been applied retroactively to consolidated financial statements for prior fiscal years.
5.	From the fiscal year ended March 2019, consolidated VIEs for securitizing financial assets such as direct financing lease receivables and loan receivables are included
in segment revenues, segment profits and segment assets. The amounts in the previous years have been retrospectively reclassified to reflect this change.
6.	From the fiscal year ended March 2020, FASB Accounting Standards Update No. 2016-02 (Leases (Topic 842)) has been applied, and investment in direct
financing leases has been reclassified to net investment in leases.
7.	From the fiscal year ended March 2020, FASB Accounting Standards Update No. 2018-20 (Leases (Topic 842): Narrow-Scope Improvements for Lessors) has
been applied, and the method of presentation on the statement of income has changed for certain expenses, including taxes on lessors’ direct financing
leases and operating leases.
8.	From the fiscal year ended March 2021, the classification of business segments has been reorganized. Segment profits and segment assets for previous
years have been retrospectively reclassified to reflect this change.

429,038
9,190,667
2.97
34,835446,628
9,087,803
3.42
31,8909.	From the fiscal year ended March 2021, the methods of allocating expenses to business divisions and calculating segment profits have changed. Segment profits
for previous years have been retrospectively reclassified to reflect this change.
10.	From the fiscal year ended March 2021, Accounting Standards Update No. 2016-13 (Measurement of Credit Losses on Financial Instruments—ASC 326 (Financial
Instruments—Credit Losses)) has been applied, and provision for doubtful receivables and probable loan losses has been reclassified to provision for credit losses.
11.	From the fiscal year ended March 2022, the method of allocating interest expense and selling, general and administrative expenses among segments has changed.
Segment profits for previous years have been retrospectively reclassified to reflect this change.
12.	From the fiscal year ended March 2022, a portion of the leasing business in the Environment and Energy segment was transferred to the Corporate Financial
Services and Maintenance Leasing segment. Segment profits and segment assets for previous years have been retrospectively reclassified to reflect this change.
13.	From the fiscal year ended March 2023, the method of allocating interest expenses and selling, general and administrative expenses to segments has beenchanged. Segment profits for the previous fiscal year have been retrospectively reclassified to reflect this change.
14. From the fiscal year ending March 2024, segment profits have been calculated with broadened the scope of profit sharing for inter-segment collaboration. Segment
profits for the previous fiscal years have been retrospectively reclassified to reflect this change.
15. From the three months ended June 2023, Accounting Standard Update No. 2018-12 (Targeted Improvements to the Accounting for Long-Duration Contracts-ASC
944 (Financial Services—Insurance)) has been applied retroactively to the fiscal year ended March 2022.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATION

Consolidated Balance Sheets

CORPORATE GOVERNANCE(Millions of yen)2022¥   951,242¥   954,827¥ 1,231,860

128,333

136,985

135,048

1,029,518

1,057,973

1,087,563

3,670,784

3,862,604

3,877,602

Allowance for Credit Losses(78,945)(69,459)(64,723)

Investment in Operating Leases

1,408,189

1,463,202

1,537,178

2,660,443

2,852,349

2,940,858

Property under Facility Operations

491,855

561,846

620,994

Investment in Affiliates

887,764

978,033

1,000,704

Trade Notes, Accounts and Other Receivable

354,334

359,949

441,803

Inventories

142,156

139,563

169,021

Office Facilities

246,399

240,421

253,649

1,671,010

1,742,391

2,057,828¥13,563,082¥14,280,684¥15,289,385

Restricted CashNet Investment in Leases
Installment Loans

Investment in Securities

Other Assets
Total Assets

The amounts of ¥63,272 million as of March 31, 2021, ¥151,601 million as ofMarch 31, 2022 and ¥197,041 million as of March 31, 2023 are measured atfair value by electing the fair value option under FASB ASC 825.

The amounts of ¥9,384 million as of March 31, 2021, ¥19,353 million as ofMarch 31, 2022 and ¥22,874 million as of March 31, 2023 are measured at fairvalue by electing the fair value option under FASB ASC 825.

The amounts of ¥6,297 million as of March 31, 2021, ¥5,214 million as ofMarch 31, 2022 and ¥4,676 million as of March 31, 2023 are measured at fairvalue by electing the fair value option under FASB ASC 825.

ORIX INTEGRATED REPORT 2023



| 87

(Millions of yen)

2023

ASSETSCash and Cash Equivalents

DATA

As of March 31, 2021, 2022 and 2023



2021

STRATEGIES BY BUSINESSLIABILITIESShort-term Debt
Deposits
Trade Notes, Accounts and Other Payable
Policy Liabilities andPolicy Account Balances

The amounts of ¥266,422 million as of March 31, 2021, ¥198,905 million as ofMarch 31, 2022, and ¥163,734 million as of March 31, 2023 are measured atfair value by electing the fair value option under FASB ASC 825.

Income Taxes:
Current
DeferredLong-term Debt
Other Liabilities
Total Liabilities
Redeemable Noncontrolling Interests
Commitments and Contingent Liabilities
EQUITY
Common Stock:
Authorized		
2,590,000,000 shares
IssuedMarch 31, 2021
1,285,724,480 shares
March 31, 2022
1,258,277,087 shares
March 31, 2023
1,234.849,342 shares
Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive Income (Loss):
Net unrealized gains on investment in securities
Impact of changes in policy liability discount rate
Debt valuation adjustments
Defined benefit pension plans
Foreign currency translation adjustments
Net unrealized losses on derivative instruments
Sub-Total
Treasury Stock, at Cost:
March 31, 2021
68,386,164 shares
March 31, 2022
64,877,309 shares
March 31, 2023
64,543,473 shares
ORIX Corporation Shareholders’ Equity
Noncontrolling Interests
Total Equity
Total Liabilities and Equity

2021

2022

2023

¥   307,269
2,317,785
260,712¥   439,639
2,276,158
291,422¥   508,796
2,246,345
366,851

1,822,422

1,912,698

1,832,057

22,170341,290
4,416,833
971,457
10,459,938—

115,340
346,001
4,427,046
1,040,202
10,866,506—

25,199429,063
5,209,723
1,056,084
11,674,118
945

221,111

221,111

221,111259,3612,744,588

260,479
2,914,558

233,169
3,054,448(16,208)—558(21,073)(36,456)(11,471)(84,650)(111,954)(72,892)
37,536221(8,072)
61,914
2,788
21,495(113,447)(183,034)
164,516275(3,617)
155,91222,083
156,135(121,256)

3,028,456
74,6883,103,144¥13,563,082

3,304,196
109,982
3,414,178¥14,280,684

3,543,607
70,7153,614,322¥15,289,385

Notes: 1. The Company’s shares held through the Board Incentive Plan Trust (2,154,248 shares as of March 31, 2021, 1,963,282 shares as of March 31, 2022, and 2,800,866 shares as of March 31, 2023) are included in the number of treasury shares as of March 31, 2021, 2022 and 2023, respectively.
2. From the three months ended June 2023, Accounting Standard Update No. 2018-12 (Targeted Improvements to the Accounting for Long-Duration Contracts-ASC 944 (Financial Services—Insurance)) has been applied retroactively to the fiscal year ended March 2022.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 88

Consolidated Statements of Income

Consolidated Statements of Comprehensive Income

For the years ended March 31, 2021, 2022 and 2023

For the years ended March 31, 2021, 2022 and 2023

(Millions of yen)

2021

2022

2023

¥  271,194¥  279,589¥  317,612

Gains on investment securities and dividends

46,09756,51032,430Operating leases

397,065

450,454499,541

Life insurance premiums and related investment income

487,550

481,810494,070

Sales of goods and real estate

410,953435,398

392,569

Services income

679,849

816,604

930,151

Total revenues

2,292,708

2,520,365

2,666,373

Revenues:
Finance revenues

Interest expense

78,06868,232

127,618

Costs of operating leases

295,628

322,070

336,987

Life insurance costs

374,348

363,569

373,906

Costs of goods and real estate sold347,721381,119333,009

Services expense

439,233

495,110571,127

Other (income) and expense

17,125

20,494

14,445

Selling, general and administrative expenses

456,795

522,782559,406

Provision for credit losses

16,021

3,939

7,756

Write-downs of long-lived assets

3,020

35,666

2,297

Write-downs of securities

5,935

730

824

2,033,894

2,213,711

2,327,375

258,814306,654

338,998481

15,00625,091

23,300187,787

26,915

Operating Income
Equity in Net Income of Affiliates
Gains on Sales of Subsidiaries and Affiliates and Liquidation Losses, net

4,966

—

1,174

287,561

509,447

392,178

Provision for Income Taxes

90,747

186,594

95,245Net Income

196,814322,853

296,933

4,453

5,477

6,561

(23)

—

32

¥  192,384¥  317,376¥  290,340

Bargain Purchase Gain
Income before Income Taxes

Net Income Attributable to the Noncontrolling Interests
Net Income Attributable to the Redeemable Noncontrolling Interests
Net Income Attributable to ORIX Corporation Shareholders(Millions of yen)

2021

2022

2023

¥196,814¥322,853¥ 296,933(11,182)(56,684)(110,166)—

62,177

126,980

Net change of debt valuation adjustments

(899)

(337)

54

Net change of defined benefit pension plans

5,330

13,002

4,448

Net change of foreign currency translation adjustments

36,246105,693

94,707

Net change of unrealized gains (losses) on derivative instruments

4,782

15,07019,670Total other comprehensive income (loss)

34,277

138,921

135,693

Comprehensive Income

231,091

461,774

432,626

Comprehensive Income Attributable to the Noncontrolling Interests

5,128

12,137

12,059Comprehensive Income Attributable to the Redeemable Noncontrolling Interests

(303)

—

(17)

¥226,266¥449,637¥ 420,584

Net Income

Expenses:

Total expenses



Note: From the three months ended June 2023, Accounting Standard Update No. 2018-12 (Targeted Improvements to the Accounting for Long-Duration ContractsASC 944 (Financial Services—Insurance)) has been applied retroactively to the fiscal year ended March 2022.

Other comprehensive income (loss), net of tax
Net change of unrealized gains (losses) on investment in securities
Impact of changes in policy liability discount rate

Comprehensive Income Attributable to ORIX Corporation Shareholders

Note: From the three months ended June 2023, Accounting Standard Update No. 2018-12 (Targeted Improvements to the Accounting for Long-Duration ContractsASC 944 (Financial Services—Insurance)) has been applied retroactively to the fiscal year ended March 2022.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESS

Breakdown of Assets and Revenues by Segment

DATA

ORIX INTEGRATED REPORT 2023

| 89

(Fiscal year ended March 2023)

(Millions of yen)

Corporate Financial Services andMaintenance Leasing
Main Components of Segment Assets

Real Estate

1,514,070

PE Investment and Concession
935,027

Environment and Energy

605,471773,617Net Investment in Leases

Corporate leasing, sales finance, andauto leasing

566,010 Real estate leasing

Installment Loans

Corporate loans, loans purchased underloan servicing unit

333,922 —Investment in Operating Leases

Leasing and rental of auto andprecision measuring equipment

511,184 Real estate rental

Investment in Securities

Investment in listed shares

35,164 Investment in funds

Property under Facility Operations andServicing Assets

Solar power facilities(JV with Kyudenko Corporation)

18,908 Facility operation

170,425 Investees’ operating assets

51,978 and equipment

Inventories—

1,104 Condominiums

108,789 Investees’ operating assets

Advances for Finance Leases andOperating Leases—

1,566 Rental properties under development

112,973 —Investment in Affiliates

Investment in joint ventures including
new businesses

16,961 Joint development of rental properties

117,040 and PE investment

Advances for Property under
Facility Operations—

Goodwill, Intangible Assets Acquiredin Business Combinations—

Main Components of Segment Revenues
Finance Revenues

Interest revenues from loans, revenues
from corporate leasing and sales finance,
and auto leasing revenues

Gains on Investment Securities
and Dividends

Gains on listed shares

Operating Leases

Auto and precision measuring equipment
leasing, rental revenues, and gains onsales from used cars

Life Insurance Premiums andRelated Investment Income—

Sales of Goods and Real Estate

Revenues from sales of usedrental equipment

Services Income

Various fees and revenues from vehicle
maintenance services— Operating facilities under development

57,587 —— —302,698 Investees’ operating assets
3,894 Investment in listed shares and in funds

Investment in concession business

6,625 —

Insurance

1,616 Leasing of energy-saving equipment

2,050,412

6,723 ——

190 —

18,10952,976 —264 Operating assets (rental properties)

27,46742,401 —

1,580 government bonds and other assets— —Environment and energy-related facilities

Management of corporate and362,043 ——

48,716 —9,825 —

—

4 —

1 —

—

190,384 ——

88,493 ——4,686

36,678 Investment in power business abroad
Environment and energy-related facilities

2,354 and equipment under development

29,251 —54,996 —368,748 —114,114 —429,907418,736

376,405

215,770

60,066 Revenues from real estate leasing(442) —
Rental revenues from rental properties and258,385 gains on sales of rental properties— —5,356 Gains on sales of condominiums

Revenues from facility operation and asset

106,542 management fees

5,562 —
Gains on sales of investees, equity income/(243) dividends from investees and funds
55,544 Investees’ lease income— —96,030 Revenues from sales of goods by investees
Revenues from services provided

261,843 by investees

2,000,150

Leasing revenues from energy-saving

159 equipment

499,487

1,230 —

300

1,298 —

22 ——

38,653 —

78 —

—

— —
280,361 —Revenues from Environment and Energy

55,934 businesses and gains on sales

Life insurance premiums and— investment income

496,561

4,200 ——

210,240 —2,626

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 90

Breakdown of Assets and Revenues by Segment (Fiscal year ended March 2023)

(Millions of yen)

Banking and Credit
Main Components of Segment Assets

Aircraft and Ships
2,698,747

ORIX USA
742,890

ORIX Europe
1,462,067

12,595,338— Leasing and sales finance454,961

1,087,380

743,091 —— Corporate loans

312,7883,877,591

3,612 —

— Auto leasing

329,549

1,523,608

84,147 Investment in funds

50,3602,938,352—

Installment Loans

Real estate investment
loans and card loans

Investment in Operating Leases—

Investment in Securities

Management of corporate
and government bonds and other assets

Property under Facility Operations andServicing Assets—— —— Mortgage servicing rights

Inventories—

9 —Advances for Finance Leases andOperating Leases—— —Investment in Affiliates Investment—— Investment in Avolon

Advances for Property under
Facility Operations

—

— —

— —

— —

Goodwill, Intangible Assets Acquired in
Business Combinations—

11,771 —18,461 —84,28654,00978,066 —6,660 CMBS

Main Components of Segment Revenues

2,395,340 Ship loans purchased— Aircraft and ship leasing
291,627 —Finance Revenues

Interest revenues from real estate
investment loans and card loans

Gains on Investment Securities
and Dividends—

Operating Leases—— sales of aircraft and ships

Life Insurance Premiums and Related
Investment Income—

Sales of Goods and Real Estate—

Services Income—(839) —
Lease income and gains on— —74,151 Corporate loans
295,858 —Investment in municipal bonds,

5,800 CMBS and funds

483 —423,229 Seed capital

417,941

Total
1,395,096

Net Investment in Leases— —Asia and Australia

81,291 —

— —

1,184

685,829

37 —

142 —

— —

202

168,824

— —

— —

— —

3,720

118,264

235,586

1,000,354— ——97,472

157,811 —331,080 —

6,746

1,097,664

189,045

206,486

189,7442,663,875

812 and interest revenues

59,933319,387(2,155) Equity income from PE funds

2,886

31,814

Auto leasing revenues and104,614494,908

348,583 PE investment

Interest revenues from loans andGains on sales of investees,(1,354) equity income from PE funds, andgains on sales of municipal bonds

52,408 —106,599 —32,641 Equity income from seed capital

2,714 PE investment

Leasing and sales finance revenues

37,208 —426 —— gains on sales of used cars

— —

— —

— —

— —

—

496,561

— —

624 —

2,034 —

— —

1,698

390,303

20,613930,902

Investment arrangement fees, asset

7,059 management fee revenues

10,871 Asset management fee revenues

47,345 Asset management fee revenues

Revenues from auto maintenance

207,829 service

INTRODUCING ORIX

VALUE CREATION STORYGroup Companies

CREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

(As of March 31, 2023)

Company Name

Principal Business

Established(Acquired)

ORIX Group
Controlling
Share

Corporate Financial Services and Maintenance Leasing

Principal Business

Established(Acquired)

ORIX Group
Controlling
Share

ORIX Eco Services Corporation

Trading of Recycled Metals and Other Resources, Collection and Transportation ofIndustrial Waste, and Intermediate Waste Processing

Apr. 1998

100%

ORIX Environmental Resources Management Corporation

Waste Recycling

Sep. 2002

100%

Ubiteq, INC.

Development and Provision of IoT Solutions, Design, Manufacturing and Quality
Assurance of Electronic Devices, Design, Development and Maintenance of Software(Jul. 2010)

57%

Company Name
Environment and Energy

ORIX Auto Corporation

Automobile Leasing, Rental, Car Sharing, Sales of Used Automobiles

Jun. 1973

100%

ORIX Rentec Corporation

Rental and Leasing of Test and Measurement Instruments and IT-related Equipment

Sep. 1976

100%

ORIX Capital Corporation

Venture Capital

Oct. 1983

100%

ORIX Asset Management & Loan Services Corporation

Loan Servicing

Apr. 1999

100%

NS Lease Co., Ltd.

Leasing, Lending, Other Financial Services(Jul. 2002)

100%

ORIX Tokushima Corporation

Leasing, Other Financial Services(Oct. 2005)

95%

ONE Energy Corporation

Sales, Leasing and Rental of Solar Panels and Electricity Storage Systems

Mar. 2013

70%

ORIX Loan Business Center Corporation

Personal Loan Related Asset Management, Customer Relations

May 2009

99%

Zeeklite Co., Ltd.

Waste Landfill, Mining and Sales of Zeolite(Feb. 2017)100%

Tsukuba Lease Corporation

Leasing(Jun. 2010)95%

Kyuko-Lease Inc.

Leasing, Other Financial Services(Jan. 2012)85%

ORIX Renewable Energy Management Corporation

Operation, Management, and Maintenance of Power Plants That Use Renewable
Energy Sources

Jun. 2018100%

FREEILL CORPORATION

Medical Equipment Rental(May 2013)

100%

Yodogawa Transformer Co., Ltd.

Manufacturing, Rental, and Sales of Power Receiving, Transforming, and Generating
Facilities and Equipment, Various Types of Transformers, Cubicles, etc.

(Jan. 2018)

100%

ORIX Life Insurance Corporation

Life Insurance

Apr. 1991

100%

Lifetime Consulting Corporation

Insurance Agency Services

Oct. 2012100%

Life Assist Co., Ltd.

Insurance Agency Services(Feb. 2020)

80%

Real Estate
ORIX Interior Corporation

Real Estate Rental, Parking Lot Business(Jan. 1987)

100%

ORIX Hotel Management Corporation

Onsen Hotel, Hotel, and Training Accommodation Facility Operation

Jan. 1997

100%

ORIX Real Estate Corporation

Real Estate Investment, Development, Rental, Facility Operation and Management

Mar. 1999

100%

ORIX Asset Management Corporation

Asset Management of J-REIT

Sep. 2000

100%

Chofu Driving School Corporation

Driving School(Dec. 2005)

100%

Insurance

Banking and Credit
ORIX Credit Corporation

Consumer Finance Services

Jun. 1979

100%

ORIX Bank Corporation

Banking(Apr. 1998)

100%

Ship Charter and Ship Broker Service

Nov. 1977

100%

Aircraft and Ships
ORIX Maritime Corporation

ORIX Real Estate Investment Advisors Corporation

Real Estate Investment and Advisory Services

Sep. 2007

100%

ORIX Aquarium Corporation

Aquarium Operation

Apr. 2011

100%

ORIX Headquarter Functions (Not included in Segment Financial Information)

DAIKYO INCORPORATED

Housing Development and Sales, Redevelopment(Jan. 2019)

100%

ORIX Insurance Services Corporation

Insurance Agency Services

Sep. 1976100%

ANABUKI CONSTRUCTION INCORPORATED

Housing Development and Sales, Construction Services(Jan. 2019)

100%

ORIX Computer Systems Corporation

Software Engineering and Systems Management

Mar. 1984

100%

DAIKYO ASTAGE INCORPORATED

Condominium Management, Repair and Maintenance, Resident Services(Jan. 2019)

100%

ORIX Baseball Club Co., Ltd.

Professional Baseball Team Management(Oct. 1988)

100%

ANABUKI COMMUNITY INCORPORATED

Condominium Management, Repair and Maintenance, Resident Services(Jan. 2019)

100%

Osaka City Dome Co., Ltd.

Management and Operation of Multipurpose Halls, and Planning, Production, andOperation of Various Events Including Sports(Sep. 2006)

90%

DAIKYO ANABUKI CONSTRUCTION INCORPORATED

Condominium Repair and Maintenance, Construction Services, Building
Diagnostics, Aseismic Reinforcing Work

(Jan. 2019)

100%

ORIX Business Center Okinawa Corporation

Business Center, Contact Center

Nov. 1999

100%

DAIKYO ANABUKI REAL ESTATE INCORPORATEDReal Estate Buying, Selling, Brokerage, Leasing, Management(Jan. 2019)

100%

ORIX Business Support Corporation

Business Support Services

Apr. 2007

100%

ORIX Facilities Corporation

General Building, Rental Condominium, and Other Facilities Management, Real
Estate Brokerage, Construction Services(Jan. 2019)100%

Our Group| 91

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 92

Group Companies (As of March 31, 2023)

Company NameCountry(Region) *1

Principal Business

Established(Acquired)

ORIX Group
Controlling
Share

Overseas Businesses

Company NameCountry(Region) *1

Principal Business

Established(Acquired)

ORIX Group
Controlling
Share

ORIX Leasing Singapore Limited

Singapore

Leasing, Sales Finance, Lending

Sep. 1972

50%

ORIX Corporation USA

USA

Financial Services

Aug. 1981

100%

ORIX Investment and Management Private Limited

Singapore

Equity Investment, Lending

May 1981

100%

Boston Partners Global Investors, Inc.

USA

Asset Management(Jul. 2013)

100%

ORIX Leasing Malaysia Berhad

Malaysia

Leasing, Lending

Sep. 1973

100%

Harbor Capital Advisors, Inc.

USA

Asset Management(Jul. 2013)

100%

PT. ORIX Indonesia FinanceIndonesia

Leasing, Automobile Leasing

Apr. 1975

85%

Lument Real Estate Capital Holdings, LLC *2

USA

Mortgage Banking and Loan Servicing

Sep. 2013

100%

PT Sinar Mitra Sepadan FinanceIndonesia

Used Car Loans for Sole Proprietors and Individual Customers(Nov. 2015)

85%

Boston Financial Investment Management, L.P.

USA

Low Income Housing Tax Credit Syndicator(Jul. 2016)

100%

ORIX METRO Leasing and Finance Corporation

Philippines

Leasing, Automobile Leasing, Lending

Jun. 197740%

NXT Capital Group, LLC

USA

Loan Origination, Asset Management(Aug. 2018)

100%

Thai ORIX Leasing Co., Ltd.

ThailandLeasing, Automobile Leasing and Rentals

Jun. 197896%

RB Capital S.A.

BrazilReal Estate Securitization, Asset Management, Real Estate
Development and Investment(Dec. 2016)64%

OLP Financial Services Pakistan Limited *3

Pakistan

Equipment Leasing, Automobile Leasing, Loans

Jul. 1986

49%

ORIX Asia Limited

Hong Kong

Leasing, Lending, Automobile Leasing, Banking

Sep. 1971

100%

ORIX Auto Infrastructure Services Limited

India

Automobile Leasing, IT Leasing, Rentals, Leasing, Commercial
Vehicle Loans, Commercial Mortgage Loans

Mar. 1995

99%

ORIX Asia Capital Limited

Hong Kong

Equity Investment, Lending

Jul. 1973

100%

ORIX Australia Corporation Limited

Automobile Leasing and Truck Rentals

Jul. 1986

100%

ORIX Finance Services Hong Kong Limited

Hong Kong

Leasing, Lending, Consumer Finance Services(May 2002)

100%

ORIX New Zealand Limited

Automobile Leasing

Dec. 1988

100%

ORIX Asia Asset Management Limited

Hong Kong

Investment Advisory, Asset Management

Mar. 2021

100%

ORIX Aviation Systems Limited

Ireland

Aircraft Leasing, Aircraft Asset Management

Mar. 1991

100%

ORIX Taiwan Corporation

TaiwanLeasing, Sales Finance, Insurance Agency Services(Feb. 1991)

100%

ORIX Corporation Europe N.V.

Netherlands

Headquarters for the Business in Europe(Jul. 2013)

100%

ORIX Auto Leasing Taiwan Corporation

TaiwanAutomobile Leasing

Apr. 1998

100%

Robeco Institutional Asset Management B.V. (RIAM)

Netherlands

Asset Management(Jul. 2013)

100%

ORIX Taiwan Asset Management Company

Taiwan

NPL Investment, Loan Servicing

Nov. 2004

100%

Transtrend B.V.

Netherlands

Asset Management(Jul. 2013)

100%
100%

Australia
New Zealand

ORIX Capital Korea Corporation

South Korea

Automobile Leasing, Leasing, Lending

Feb. 2004

100%

ORIX Corporation UK Limited

UK

Equity Investment

Jan. 2018

ORIX Private Equity Korea Corporation

South Korea

Fund Operation and Management

Mar. 2010

100%

Gravis Capital Management Ltd.

UK

Fund Operation and Management(Jan. 2021)

70%

Elawan Energy S.L.

Spain

Development and Operation of Wind and Solar Power Generation(Jul. 2021)

100%

ORIX China Corporation

China

Leasing, Rental

Aug. 2005

50%

ORIX (China) Investment Co., Ltd.

China

Leasing, Equity Investment, Other Financial Services

Dec. 2009100%

ORIX China Industrial Holdings Limited

China

Leasing, Equity Investment, Other Financial Services

Sep. 2021

50%*1	ORIX has offices in other locations not included in the list above. In total, ORIX’s business operations currently extend across 28 countries and regions
worldwide.
*2	The corporate name was legally changed from ORIX Real Estate Capital Holdings, LLC to Lument Real Estate Capital Holdings, LLC, effective January 1, 2023.
*3 Listed company.

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 93

Corporate Profile/Stock Information/Investor Memo
Corporate Profile (As of March 31, 2023)

Stock Information (As of March 31, 2023)

Company NameORIX Corporation

Number of Shares

Established

April 17, 1964

Total Number of Shares Authorized

2,590,000,000 shares

Total Number of Shares Issued and Outstanding

1,234,849,342 shares

Head Office	World Trade Center Building, South Tower, 2-4-1
Hamamatsu-cho, Minato-ku, Tokyo 105-5135, Japan

Major Shareholders (Top 10)

852,475

Number of Shareholders

Tel: +81-3-3435-3000
Shareholders’ Equity¥3,543,607 million

Number of Shareholders/Composition of Shareholders

Fiscal Year-End

March 31

■ Individuals ■ Financial Institutions ■ Overseas Corporations ■ Other
Total number of shareholders: 852,475

Consolidated Companies 999
Affiliates

138

Number of Employees

34,737

Global Network

28 countries and regions worldwide

2023

16.7%

2022

15.6%

41.0%

15.9%

2020

14.2%

2019

11.6%

36.8%

The Master Trust Bank of Japan, Ltd.
(Trust Account)

255,019

21.73

Custody Bank of Japan, Ltd. (Trust Account)

96,0438.18

SSBTC CLIENT OMNIBUS ACCOUNT

22,3601.90

CITIBAN K, N.A .−NY, AS DEPOSITARY BANKFOR DEPOSITARY SHARE HOLDERS

21,989

1.87

STATE STREET BANK WEST CLIENT−TREATY 505234

20,885

1.78

JPMorgan Securities Japan Co., Ltd.

16,201

1.38

SMBC Nikko Securities Inc.

16,044

1.36

JP MORGAN CHASE BANK 385781

15,547

1.32

BNYM AS AGT/CLTS NON TREATY JASDEC

14,477

1.23

STATE STREET BANK AND TRUST COMPANY
505223

11,031

0.94

0.8%

49.2%

Total number of shareholders: 444,476
38.2%

0.9%

46.4%

Total number of shareholders: 603,966
35.8%

0.9%

46.7%

Total number of shareholders: 753,133
2021

Number of Percentage ofShares Held Total Shares(Thousands)
in Issue (%)

1.0%
41.3%

Total number of shareholders: 823,126
36.9%

Name

49.4%

0.8%

Note: Calculated excluding treasury shares.

Notes: 1.	Number of shares held is rounded down to the nearest thousand shares.
2.	Percentages of total shares in issue are rounded down after the second decimal place.
3.	Percentage of total shares in issue above is calculated after deducting treasury stock (61,742
thousand shares).

INTRODUCING ORIX

VALUE CREATION STORYCREATING VALUEMANAGEMENT FOUNDATIONCORPORATE GOVERNANCE

STRATEGIES BY BUSINESSDATAORIX INTEGRATED REPORT 2023

| 94

Corporate Profile/Stock Information/Investor Memo

Investor Memo (As of August 1, 2023)
Transfer Agent for Common Shares

Total Shareholder Return (TSR*)（Index）
300

250

Mitsubishi UFJ Trust and Banking Corporation

TOPITel:X 0120–232–711 (toll-free in Japan)

TSR (Annualized rate)
Holding Period

3 years

5 years

10 years

ORIX

22.4%

6.6%

8.9%

TOPIX

15.3%

5.7%

9.2%

ORIX

TOPIX

VolumeNote: Returns are calculated using the geometricmean of cumulative returns.

(Thousandshares)200

400,000

150

300,000

100

200,000

50

100,000

Exchange Listings
ORIStock
XTokyo Stock
Exchange, Prime Market Securities Code: 8591
New York Stock Exchange

Trading Symbol: IX

Depositary and Registrar for American Depositary Receipts
Citibank, N.A., Shareholder Services
P.O. Box 43077, Providence, RI
02940-3077, USA
Tel: 1–877–248–4237 (toll-free in the U.S.)
1–816–843–4281 (outside the U.S.)
Fax: 1–201–324–3284

0 2013
April

2014
January

2015
January

2016
January

2017
January

2018
January

2019
January

2020
January2021
January2022
January2023
January0

Note: The above graph shows the rate of return on an investment made in April 2013, including dividends and the stock price as of March 31, 2023. The ORIX chart is an index of the investment result of the stock price plus
dividends (assuming that dividends are not reinvested), with an investment amount in April 2013 as 100. The index for comparison uses data from the Tokyo Stock Price Index (TOPIX), including dividends, indexed in thesame manner.
* TSR (Total Shareholder Return): Total return on investment, combining capital gains and dividends

Passive Foreign Investment Company Rules

The Company believes that it will be considered a “passive foreign investment company” for U.S. federal income tax purposes in the year to which these consolidated financial results relate and for the foreseeable future by reasonof the composition of its assets and the nature of its income. A U.S. holder of the shares or ADSs of the Company is therefore subject to special rules generally intended to eliminate any benefits from the deferral of U.S. federal
income tax that a holder could derive from investing in a foreign corporation that does not distribute all of its earnings on a current basis. Investors should consult their tax advisors with respect to such rules, which are summarizedunder “UNITED STATES TAXATION” in the Company’s Form 20-F filed with the U.S. Securities and Exchange Commission.

Presentation of Financial Information

The Company’s fiscal year ends on March 31. The fiscal year ended March 31, 2023 is referred to throughout this Integrated Report as “2023.3” and other fiscal years are referred to in a corresponding manner.

Forward-Looking Statements

This document may contain forward-looking statements about expected future events and financial results that involve risks and uncertainties. Such statements are based on our current expectations and are subject to uncertainties
and risks that could cause actual results to differ materially from those described in the forward-looking statements. Factors that could cause such a difference include, but are not limited to, those described under “Risk Factors” in
the Company’s Form 20-F filed with the U.S. Securities and Exchange Commission and under “Business Risk” of the securities report (yukashoken houkokusho ) filed with the Director of the Kanto Local Finance Bureau. The Company
makes its annual report on Form 20-F and other reports available free of charge on or through ORIX Group’s website. (https://www.orix.co.jp/grp/en/library).
Form 20-F filed with the U.S. Securities and Exchange Commission

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Ratio 1 ADS = 5 common shares