JSDA’s Major Work Plans(2024 – 2025)

July 1, 2024

© Japan Securities Dealers Association.All Rights Reserved.

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Work to achieve households’ stable asset formation through promotion and refinements ofasset-building support programs

1. Undertake initiatives to promote households’ stable asset formation and to further ensure
the “shift from savings to investment”
Based on the “Basic Policy Direction for Holistic Enhancement of Policy Measures to Support Households’ Stable Asset Formation”(Cabinet approval on March 15, 2024), work to make the “shift from savings to investment” full-scale and continuous trend. These
efforts include dissemination of information on the use of NISA and other asset-building support programs in a timely and proper
manner, comprehensive analysis of such information, and the planning and promotion of effective measures for asset-building
support.
Conduct PR activities related to the NISA system, such as operating a dedicated website, providing brochures, and distributing andbroadcasting promotional videos.

2. Support and collaborate with the Japan Financial Literacy and Education Corporation (J-FLEC)
in its operations to enhance the financial literacy of the public
Complete transfer of JSDA’s financial literacy and education support function, including respective personnel and budget, to the
J-FLEC.
After the transfer of the said business to the J-FLEC, support the establishment of a cooperative relationship between association
member firms and the J-FLEC, and appropriately carry out the tasks entrusted to JSDA district offices by the J-FLEC.
From the perspective of supporting J-FLEC's activities, engage in in-depth dialogue with J-FLEC through various opportunities, andmake proposals to the national and local governments, the business community, and other stakeholders as necessary.
Work on to further enhance education on asset-building in schools.

3. Respond to fraud related to securities investments
Respond to fraud related to securities investments by issuing investor alerts and operating call centers, etc.

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Work to achieve households’ stable asset formation through promotion and refinements ofasset-building support programs

4. Improve asset-building support programs and its usability
Undertake initiatives to improve usability of the NISA system
Work with related parties to review for further improving usability of the NISA system.
Work toward reform of the defined contribution (DC) pension system (Corporate DC, iDeCo)Work with related parties to improve the system/operations of the DC pension (Corporate DC, iDeCo) towards the upcoming
discussions on the next pension system along with the publication of the fiscal verification results of public pensions by the Ministryof Health, Labour and Welfare.

5. Undertake initiatives aimed at promoting asset utilization for elderly people and enablingsmooth intergenerational asset transfer
Continue to discuss continuous asset management and custody by elderly people, as well as practice of transactions supported byagents (Family Support Securities Account) to pass on their assets and literacy to offspring.
Work with related parties to support the intergenerational transfer of financial assets by discussing review on the requirements forthe in-kind payment of inheritance tax and the valuation basis for inheritance tax.

6. Undertake initiatives to enhance the investment environment for individual investors
Work with related parties to promote the integration of taxation on financial income and gains (i.e., Aggregation of profits andlosses on derivatives transactions).
Deliberate on measures to foster an understanding of the significance and functions of shareholder incentives among the public aswell as issuers and institutional investors, etc.

2Market Intermediaries(Members)

Promote customer-oriented business conduct and improve market
intermediaries’ functions and credibility

1. Carry out measures to ensure customer-oriented business conduct
Based on the discussions on “customer-oriented business conduct” at the Financial System Council of the JFSA and implementation
status by securities firms, formulate and exhibit necessary responses.

2. Undertake initiatives to realize financial services fit for an aging society
Take initiatives to contribute for providing financial services according to each elderly customer’s attributes and status.

3. Support member firms to improve cybersecurity readiness
Take actions based on the government’s strategic direction for economic security. Share information on cyber incident from member
firms, provide information on cybersecurity from the government and coordinate member firms’ participation in the government’s
cybersecurity exercises, in addition, enrich training programs and educational activities for member firms.

4. Enhance support for member firms’ compliance efforts
Support member firms in compliance systems through compliance consulting desk, the JSDA established in September 2023. Aim toenhance competences of sales representatives by improving and enriching the contents of sales representative qualification renewal
training program.
For training program related to the self-regulatory rules (JSDA Compliance Training), further enrich the program and improve theconvenience for the participants.

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Market Intermediaries(Members)

Promote customer-oriented business conduct and improve market
intermediaries’ functions and credibility

5. Ensure effective self-regulatory functions
Conduct agile and effective inspections on association member firms
Continue to conduct agile and effective inspections on association member firms according to their business operations, status ofassets, and other information, in order to check their compliance status with laws and self-regulatory rules, as well as theappropriateness of their internal administration.
Continue efforts to prevent insider trading
Continue to collaborate with market-related entities and deliberate on and implement further initiatives to prevent insider trading,as well as deliberate on improving the efficiency of the J-IRISS system.

6. Deliberate on initiatives to improve the efficiency of middle and back-office operations atsecurities firms (Cybersecurity, Inheritance, Foreign stock corporate actions, Accountopenings, Trading surveillance, Public tender offer)

In the securities industry, where regulatory and administrative responses are becoming more complex and sophisticated, member
firms are facing challenges in securing resources due to the aging workforce engaged in middle and back-office operations and thedecrease in the labor population. Hence, in order to maintain and improve the efficiency of these operations, conduct industrywide discussions at the consultative council to the JSDA Chair and sub councils established thereunder (Sub councils on
Cybersecurity, Inheritance, Foreign Stock Corporate Actions, Account Openings, Trading Surveillance, Public Tender Offer,respectively).

4Market Intermediaries(Members)

Promote customer-oriented business conduct and improve market
intermediaries’ functions and credibility

7. Facilitate paperless and digitalized procedures in securities transactions
Establish guidelines for customer awareness to ensure the smooth start of the system in delivering digitalized documents tocustomers the principal method.
Discuss necessary regulatory reforms over self-regulatory rules and Q&As while keeping closely observing implementing status of
the related laws and regulations.
Take initiatives to promote digitization of dividend receiving procedures (dividend receipt method).

8. Support the development of the securities firms’ human resources toward solving social issues
Provide videos on various themes（laws and regulations, research, business skill, IT/DX, cybersecurity measures, SDGs, elderly
customer service) through the "JSDA Training Hub," a training website for the executives and employees of securities firms toencourage them to acquire knowledge relevant to their businesses.
Continue to support member firms’ efforts to develop human resources through holding in-person training programs and exchange
meetings, etc. for information exchange and interaction among member firms.

5Market Intermediaries(Members)

Promote customer-oriented business conduct and improve market
intermediaries’ functions and credibility

9. Undertake initiatives to review and streamline/enhance compliance with self-regulations
Continue to work on reviewing and abolishing regulations, such as working on relaxation of regulations that have become overly
formal and uniform while each member firm strives to inspire creativity and ingenuity in practicing customer-oriented businessconduct.

10. Respond to the Policy Plan for Promoting Japan as a Leading Asset Management Center
Take active steps towards customers’ best interests in accordance with the discussion about product governance, which is to beestablished to manage the quality of financial instruments.

11. Respond to diversification of sales channels
Study current situations of sales channel diversification and based on the study results, deliberate and take necessary measures.

6Social Engagement Engagement
Engage with society at large by promoting SDGs, etc.
1. Bolster partnerships with both domestic and overseas parties towards the achievementof the SDGs

Manage the “Shareholders Incentives Endowment Fund for the SDGs” that utilizes social contribution-type shareholder incentives
to support people addressing the social issues relevant to SDGs and deliberate on further development of this Fund.
Work on advancing the collaboration with universities, etc. in order to promote implementing measures toward solving social issues
by taking advantage of the “knowledge” of university.

2. Support economically vulnerable children
Support economically vulnerable children to foster their hope for the future through the “Securities Industry Network for SupportingChildren,” a platform that connects securities firms with NPOs supporting children in need, as well as through the “Used Book Sale
Donations for Children’s Future.” In order to further increase awareness for addressing the poverty issue among children and youth
in the securities and banking industries, deliberate on and implement industry wide initiatives in cooperation with the Japanese
Bankers Association (JBA).

3. Enhance public awareness regarding the function and role of securities market and firms
Deliberate on and implement initiatives to further enhance awareness of the functions, roles and importance of the securities firms
among all level of the public by utilizing various media to introduce their businesses and efforts.
Deliberate on initiative to deepen the public awareness of the basic functions of the securities market and its role in the national
economy; contribute to the discussion on the reconstruction of capital markets that are progressing both domestically andinternationally.

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Social Engagement Engagement
Engage with society at large by promoting SDGs, etc.

4. Create a fulfilling work environment and promote diversity
Implement measures suitable for each level to improve working practices and bolster diversity in the industry.
(For the representatives of member firms)
Enhance outreach aimed at their stronger commitments.
(For the executives and employees of member firms)
Hold an industry-wide conference to enhance such awareness among them, and a seminar that will contribute to improving women’s
health literacy for more conducive work environment for both men and women.
(For human resources managers of member firms)
Hold opinion exchange meetings by business category and region to provide opportunities for industry-wide network building.

8Market(Infrastructure)

Strengthen functions and competitiveness of Japanese capital markets, including
advancing financial innovation and Japan’s status as a global financial hub

1. Properly respond to the progress in financial innovation
Deliberate on and take necessary measures on tokenized securities (i.e., stocks and bonds that utilize blockchain technology) fromthe perspective of investor protection and sound development of the market, also deliberate on the necessary regulatory
framework for transactions by registered PTS operators.

2. Undertake initiatives to improve the functionality of alternative trading system(Proprietary Trading Systems (PTS))

Deliberate on the necessary system improvement based on the government's response to the "Improvement of the functionality ofalternative trading system (Proprietary Trading Systems (PTS))" as described in the “Second Interim Report of the Working Groupon Capital Market Regulations” of the Financial System Council of the JFSA.

3. Undertake initiatives to promote private placement scheme with professional investors(J-Ships: JSDA Shares and Investment trusts for Professionals)

For further use of the J-Ships, conduct PR activities and deliberate on the system improvement, such as easing the information thatcan be provided when explaining about the said system for Professional Investors and J-Ships.

9Market(Infrastructure)

Strengthen functions and competitiveness of Japanese capital markets, including
advancing financial innovation and Japan’s status as a global financial hub

4. Foster an environment to facilitate provision of growth capital to start-ups
For promoting the supply of growth capital to start-ups, deliberate on developing a system for equity-based crowdfunding andtrading unlisted securities in registered PTS operators.
Enhance PR activities to raise awareness of the unlisted stock trading system.

5. Undertake initiatives for expanding and diversifying the corporate bond market
In the light of discussion, etc. in “Working Group on Development of Infrastructure for Vitalization of the Corporate Bond Market”,
continue to consider improving the environment in which corporate bonds can be issued by companies with relatively high credit
risk, including the granting of covenants and further use of Assistant Bond Administrator.
On the “Working Group on Development of Infrastructure for Disseminating Corporate Bond Price Information”, periodically review
the system of reporting and publication for corporate bond transactions and continuously consider expanding the number of issues
to be disseminated.

6. Take initiatives aimed to expand the use of the Social Security and

Tax Number System (“My Number” System)

Consider specific measures and work with related parties to expand the scope of use of My Number in the securities industry.

10Market(Infrastructure)

Strengthen functions and competitiveness of Japanese capital markets, including
advancing financial innovation and Japan’s status as a global financial hub

7. Conduct drills to maintain market functions
Conduct BCP drills for the entire securities market to ensure that the communication network covering the entire industry functions
well in the event of a large-scale disaster.

8. Take initiatives to achieve an established status as a global financial center
Deliberate on measures to enhance Japan’s status as a global financial hub in Asia and a global financial center, and support theefforts by cities, including Tokyo and Osaka, in order to increase the global presence of the Japanese financial and capital markets.

9. Gather information regarding the shortening of stock settlement cycle (T+1)
In light of the situation where T+1 stock settlement cycle is being implemented and considered in major overseas markets, gather
information on the issues towards shortening the stock settlement cycle in Japan in cooperation with the relevant organizations.

11Global Capital Markets

Enhance global outreach and cooperation including
promotion of sustainable finance1. Conduct overseas PR activities, including the Japan Securities Summit, to attract
investment to Japanese capital markets
Actively promote Japanese financial and capital markets to overseas stakeholders by ensuring that they have a clear understandingof current state and initiatives, to attract their investment in and entry into the Japanese markets.
Further enhance the provision of English-based information by enriching contents on English website and other resources that
attract worldwide attention.

2. Conduct outreach to global capital markets regarding initiatives on transition finance in Japanto encourage better understanding

Deliberate on and implement measures for support initiatives for enhancing understanding and promoting Green Transformation(GX) and transition finance initiatives in Japan to global capital market participants, such as plant tours related to GX technology.

3. Engage with market participants concerning the latest initiatives in the global capital markets

such as sustainable financeConsider and implement measures to promote the cutting-edge practices taken in sustainable finance taken within the global
capital markets by co-hosting a conference with the International Capital Market Association (ICMA). Also, foster cooperation andcollaboration with both domestic and overseas counterparts including those in Asia.

12Global Capital Markets

Enhance global outreach and cooperation including
promotion of sustainable finance

4. Monitor developments in the global securities regulatory agenda including responses tochanges in the retail market environment, and respond as necessary

In light of the changes in the retail market environment and global discussion on new emerging issues, including at theInternational Organization of Securities Commissions (IOSCO), follow the global trends in order to properly respond in theJapanese markets.
Facilitate the discussion and information sharing regarding the accounting, audit, and sustainability disclosure standards within the
securities industry, and issue opinions to relevant stakeholders as necessary.

5. Further promote collaboration and cooperation with overseas related organizations,

including the hosting of Asia Securities Forum (ASF) Annual General Meeting in Tokyo
Lead the information exchange and collaboration amongst stakeholder to address common issues within Asian region and support
emerging markets, by utilizing opportunities such as hosting the ASF (Asia Securities Forum) Annual General Meeting in Tokyo.
Actively engage in international forums, such as the International Council of Securities Associations (ICSA) to respond to common
global challenges and provide feedback to domestic related parties as necessary.

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JSDA

Work to further revitalize the secretariat function of the JSDA

1. Improve efficiency through restructuring operations and use of Digital Transformation (DX)
Promote restructuring operations and further advance the efficiency of tasks through the use of generative AI, RPA, and secure
cloud services.

2. Sustain and improve business continuity planning (BCP), including cybersecurity measures
Enhance the JSDA’s cyber resilience in order to cope with cyber-attacks properly.
Continue to endeavor to sustain/improve effectiveness of the BCP, such as the response to events of the disaster, through the PDCA
cycle.

3. Further enhancement of the employee's capabilities
Further improvement of the employee's capabilities and qualities by enhancing training programs for expertise necessary for the
JSDA'ｓ operations, providing various opportunities for business experiences, and promoting an environment in which employees
can make proposals independently and proactively.

4. Create a fulfilling and conducive work environment
Create a fulfilling and conducive work environment by leveraging the effects of the reorganization, sharing and clarifying
organizational goals and philosophies, and enhancing internal communication.
Ensure that each employee can fully demonstrate their abilities by achieving a balance between work and life and allowing them towork with peace of minds.

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