Sustainability Book

2022

7-3 Nihonbashi Odenmacho, Chuo-ku, Tokyo, Japan
Phone: +81-3-5623-8100
URL: https://www.hulic.co.jp/en/

We identified and selected issues of especially high materiality in terms of their importance to Hulic and to our stakeholders. We willcontinue to review the materiality issues we have identified and implement effective initiatives and counteractions as well as assess
opportunities and risks. To steadily implement these initiatives, we also set KPIs and other targets so that we can quantitatively evaluate
every materiality issue, while reviewing their status every year.

To all stakeholders
We fulfill the tasks and responsibilities demanded of us through corporate activities in the real estate business, aspiring to further grow as
we create value to share with society, customers, business partners, employees, local communities, shareholders, investors, and all otherstakeholders.
We look forward to the growth and evolution of Hulic, which has continued to change with the keywords “driving innovation andaccelerating progress,” and we sincerely ask for your continued support.

Saburo Nishiura

Takaya Maeda

Chairman, Representative Director

President, Representative Director

CONTENTS
Initiatives for Employees ･･･････････････････････････････････････ 72

Our Approach to Sustainability
Corporate Philosophy and Sustainability ･････････････････････････ 2
Hulic Group’s Value Creation Process ････････････････････････････ 8Materiality Assessment ････････････････････････････････････････ 10
Opportunities and Risks related to Materiality and Our Actions ･･････ 12
Non-financial Highlights ･･････････････････････････････････････ 14
Key Performance Indicators (KPIs) /Targets and Results ･････････････ 16

Saburo Nishiura

Takaya Maeda

Environmental Initiatives

Chairman,
Representative Director

President, Representative Director

Basic Policy for Environment ･･･････････････････････････････････ 18
Initiatives for Climate Change ･･････････････････････････････････ 29
Initiatives for Biodiversity ･･････････････････････････････････････ 50

For more than half a century, Hulic has been operating a real estate leasing business focusing on a portfolio of office buildings incentral Tokyo. Our strength of having a solid business foundation, based on the prime locations of properties, has allowed us tomaintain continued growth of profits and dividends since our listing in 2008, without being affected by market conditions even in theface of adversity, including difficulties associated with the Financial Crisis, the Great East Japan Earthquake and the spread ofCorporate Governance ･･･････････････････････････････････････ 94
External Directors and External Auditors ････････････････････････ 104
Auditing Mechanism ････････････････････････････････････････ 106
Internal Control System ･･････････････････････････････････････ 109
Risk Management ･･･････････････････････････････････････････ 110
Compliance ････････････････････････････････････････････････ 113

Building a Recycling-oriented Society ････････････････････････････ 41

The starting point of Hulic's Sustainable Management is "For therealization of a society full of safety, peace of mind and trust,and for the continuous improvement of corporate value".

Corporate Governance

Information Disclosure based on TCFD Recommendations ･･････････ 52

Initiatives for Shareholders and Investors ････････････････････････ 119

Data
Environmental Performance Data ･･････････････････････････････ 122
Human Capital-related Data ･･････････････････････････････････ 125External Evaluation

Social Initiatives
Initiatives for Customers ･･････････････････････････････････････ 66
Collaboration with Business Partners ････････････････････････････ 70

Third-party Assurance ･･･････････････････････････････････････ 126
External Evaluations ･････････････････････････････････････････ 126

Editorial Policy
The "Sustainability Book 2022" was created with the aim of informing stakeholders about our various sustainability initiatives that link the creation ofsocial value and corporate growth, and creating new opportunities for dialogue.
Reporting Boundary

Reference Guidelines

Hulic Co., Ltd. and its Group companies

GRI (Global Reporting Initiative)

COVID-19. Hulic’s sustainable growth is supported by sustainability-conscious business operations and value creation to solve social"The GRI Sustainability Reporting Standards"

issues and pursue initiatives that combine social value creation with corporate growth. In our corporate philosophy, we uphold theTime of Issuance"The Environmental Reporting Guidelines (2018)"

following values: “For the realization of a society full of safety, peace of mind and trust, and for the continuous improvement ofNovember 2022

TCFD (Task Force on Climate-related Financial Disclosures) Final Report

corporate value”. As part of our management strategy, we consider that taking initiatives to address social issues will create businessCorporate GovernanceInitiatives for Local Communities ･･･････････････････････････････ 85

Message from the Management

Message from the Management

Our Approach to Sustainability

Materiality in sustainability and progress

Environmental Initiatives

In the Medium- and Long-Term Management Plan (2020 -2029), which began in FY2020, we aim to implement management thatemphasizes sustainable co-creation and co-existence with society as one of the basic strategies. With “driving innovation and accelerating
progress” as our motto, we are focusing on executing sustainability-conscious business operations and value creation to help resolve social
issues and to pursue initiatives that synchronize social value creation with corporate growth by evolving flexibly in response to changes in
the macro environment.

Data

For the realization of a society full of safety, peace of mind and trust,and for the continuous improvement of corporate value

Social Initiatives

Medium- and Long-Term Management Plan (2020 to 2029) and Sustainability

External Evaluation

Sustainability Initiatives“Recommendations of the Task Force on Climate-related Financial
Disclosures”

opportunities. We will further increase Hulic’s purpose by implementing management that emphasizes sustainability.

Hulic Co., Ltd. Sustainability Book 2022

1

Corporate Philosophy

For the realization of a society full of safety,
peace of mind and trust,and for the continuous improvement of corporate value
Basic Stance
Ideal
Company

We aim to be a company that grows each day by utilizing stable corporate
infrastructures.

Corporate
CultureWe always conduct business from a new viewpoint in an effort to increase ourcorporate value.

Stance to
Customers

We are committed to providing optimal products and services to customers,
placing customer satisfaction as our top priority.

Ideal
Employees

Each of Hulic's employees strives to provide high quality value as a professional.

Basic Principles of Corporate Conduct
The Basic Principles of Corporate Conduct, which concretely describes our Basic Stance in an easy-to-understand mannerfrom a company viewpoint, underlies our decision-making in business.

1. Respect human rights and prohibit discrimination andharassment
2. Comply with laws and rules
3. Conduct business in a faithful and fair manner
4. Manage information appropriately
5. Adhere to insider trading regulations
6. Avoid involvement with anti-social forces

7. Be considerate of environmental conservation
8. Maintain and encourage the best communication
possible
9. Respect intellectual property rights
10. Prohibit bribery, and rules concerning gifts andentertainments
11. Ensure transparency and reasonableness of transactions

Sustainability Vision
We aim to pursue realization of a sustainable society and continued growth of Hulic by putting our Corporate
Philosophy into practice. We commit to take a faithful approach to all of stakeholders.
To this end, we pursue initiatives based on a three-point Vision.
◦ We create shared value with our society by actively engaging with the environmental issues through our corporate

activities.
◦
We lay the foundation for the future by providing peace of mind to our customers through offering our highvalueadded products and services.
◦ We take compliance seriously, respect human rights and strive to perform transparent corporate activities based on

our high ethical standards.

Social Initiatives

Corporate Philosophy and Basic StanceOur Approach to Sustainability

Our Code of Conduct, which concretely describes our Basic Stance in an easy-to-understand manner from the viewpointof each employee, underlies actions our directors and employees should take.

Environmental Initiatives

Our Code of Conduct

Relationships between the Philosophical Framework and Medium- and Long-term Management Plan
Our corporate philosophy “For the realization of a society full of safety, peace of mind and trust,” means the purpose we
exist is to create shared value with society through our corporate activities. Accordingly, our corporate philosophy andour sustainability vision are on both aspects of social relationships. Based on our corporate philosophy and sustainability
vision, we formulated our corporate strategies as well as the Medium- and Long-term Management Plans.
Corporate Philosophy

Corporate GovernanceCorporate Philosophy and Sustainability

Clarifying what we value and why we exist as a company

1. Awareness of Corporate Social Responsibility
Basic StanceShowing who we need to be to realize our corporate philosophy

Sustainability Vision

Basic Principles of Corporate Conduct

Creating shared value
with society through practicing
our corporate philosophy

2. Practice of Customer-first Policy
Treat customers faithfully and kindly, listen to their requests with sincerity and provide sophisticated, efficient and highquality services.

3. Faithful and Fair Conducts
Always act with sincerity and fairness in compliance with laws and regulations, their spirits, as well as social norms.
Decisively confront anti-social forces threatening the order and stability of a civil society.

Data

Contribute to domestic and overseas economies and stable development of society by devoting ourselves to soundbusiness based on self-responsibility and fulfilling our social missions.

Ethical standards to realize our corporate philosophy and basic stance

Our Code of Conduct
A code of conduct for all to adhere

Contribute to social development and improvement through the appropriate use of our fundamental functions. While
being aware of responsibilities as good corporate citizens, commit ourselves to corporate conducts in accordance withthe social common sense and expectations through close communication with society.

5. Respect for Humanity
Build an organizational culture full of respect for humanity and that values comfort and well-being, such that people
can work with high motivation and an open-heart.

2

Hulic Co., Ltd. Sustainability Book 2022

Management Foundation

Corporate Strategies

Applicable Laws and Regulations

Medium－and Long－term Management Plan
(2020-2029)

Company Rules

Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

4. Contribution to and Harmony with the Society

3Basic Policy

Strike a balance between P/L growth, profitability, B/S soundness, andproductivity (efficiency) at a high level and achieve further growth throughdynamic transformation backed by overwhelming speedy decision-making

Hulic takes part in a range of global and domestic initiatives aimed at creating a sustainable society as well as
increasing our purpose as a real estate company.
Sustainable Development Goals (SDGs)

Business
1 Further evolve the2business model andrestructure the leasing
portfolio

Strengthen development

3

and value-added
businessesWEB reate unique newCbusiness domains
and improve Group
strengths

Management Infrastructure4 Strengthen the management5 Implement management that emphasizes

foundation and implement stringent risk
managementWEB

sustainable co-creation and co-existencewith society

New Medium- and Long-term Management Plan (2020-2029)
https://www.hulic.co.jp/en/ir/strategy/medium_term.html

Recent Results of Initiatives Related Our Sustainability
Environment: To realize a “carbon-free and recycling-oriented society”● Declared a commitment to converting to a 100% renewable energy for electricity consumption at all Company-ownedbuildings* by 2030 and started implementation● Accelerated developing inhouse non-FIT (non-feed-in tariff) solar power generation plants to achieve 100% renewableelectricity (RE100) by 2024
● Started disclosing information in line with TCFD recommendations● Formulated greenhouse gas emissions reduction targets in conformance with Science Based Target initiative (SBTi). Our

near-term (by 2030) emissions reduction targets were approved by SBTi as consistent with levels required to meet thegoals of the Paris Agreement.
● Implement the reduction of waste disposal by applying longer-life designs as standard specifications(*) Excludes single-tenant lease properties, residential properties and unmanaged shared properties for which the Company does not manage energy, and real estate for sale.

Society: providing value to the stakeholders● Promote initiatives to secure the strength to withstand in the event of an earthquake with a seismic intensity of 7 levelin all Company-owned properties by 2029
● Strengthen relationships with local communities and other stakeholders● Implement a wide range of social contribution activities (managing Shogi championships for women (Hulic Cup Hakurei

Championships and women's rank-deciding competition), supporting Japan Para-Badminton Federation, supporting
single-parent households, donating of emergency food stockpiles, etc.).

Corporate governance: Promotion of balanced management● Maintain sound corporate governance based on our Corporate Governance Guidelines● Changed the position of the chairperson of the Board of Directors, which was previously held by the President andRepresentative Director, to a system in which a non-executive director is responsible. Strengthened governance of which
the Board of Directors consists of an equal number of five executive directors and five non-executive directors.
● Disclosed directors skill matrix● Strengthened the Nominating Committee’s and the Remuneration Committee’s functions by appointing all four of ourexternal directors to the committees

4

Hulic Co., Ltd. Sustainability Book 2022

Value Creation Process
https://www.hulic.co.jp/en/sustainability/
about/process/material_issues.html#anc1

WEB

Opportunities and Risks related to Materiality and Our Actions
https://www.hulic.co.jp/en/sustainability/about/process/initiative.html

Paris Agreement and SBT
We intend to reduce greenhouse gas emissions in line with the 2015 Paris Agreement adopted at the 21st Conference of
the Parties to the United Nations Framework Convention on Climate Change (COP21). To achieve this goal, we work to
introduce environmentally-friendly equipment to Company-owned buildings, to use only renewable energy as the sourceof electricity used in all Company-owned properties(*1) by Company-owned solar photovoltaic equipment that does not
use the FIT system, and to reduce greenhouse gas emissions throughout the supply chain.
Hulic has had its near-term (by 2030) greenhouse gas emissions reduction targets approved by SBTi (the Science Based
Target initiative(*2)) as consistent with levels required to meet the goals of the Paris Agreement.
*1 Excludes single-tenant lease properties, residential properties, unmanaged shared properties for which we do not manage energy, and real estate for sale.
*2 An international initiative that promotes companies to develop greenhouse gas emission reduction targets in line with Paris Agreement goals (limiting the global temperaturerise above pre-industrial levels to well below 2˚C and limiting below 1.5˚C).

Task Force on Climate-related Financial Disclosures (TCFD*)
Mindful of the importance of disclosing climate-related financial information, we announced our support for
the information disclosure framework recommended by the Task Force on Climate-related Financial Disclosures(TCFD*) in 2020 and started disclosing information in line with the recommendations after completing analysis
and responses on the recommended framework.
We will continue providing to our stakeholders information regarding our initiatives on creating a
Information Disclosure based on TCFD
sustainable society in an easy-to-understand way and will work to further improve information disclosure.
WEB Recommendations* TCFD (Task Force on Climate-related Financial Disclosures) was established by the Financial Stability Board (FSB),
an international organization that includes the central banks of major countries as well as financial regulators. The
TCFD proposes a framework for disclosing climate-related information to investors.

https://www.hulic.co.jp/en/sustainability/
ecology/tcfd/

RE100
In 2019, we participated in RE100, an international initiative for member companies to aim using 100%
renewable energy for the electric power required for business activities. We intend to use 100% renewableenergy by 2024, developing our own solar power generation facilities that don't apply the feed-in tariff (FIT*)
system to cover the power consumption of the Group.
* A feed-in tariff (FIT) system for electricity that requires utility companies to purchase electricity generated using renewable sources for a certain period of time at a price specified
by the national government.
FIT electricity is not considered renewable energy as a portion of the cost of the electricity purchased by a utility company is added to the consumer’s bill so the tax payer mustbear some of the costs. Therefore, achieving the 100% goal with FIT electricity is not considered RE100 by definition.

Challenge Zero
Challenge Zero (Challenge Net Zero Carbon Innovation), originated by the Japan Business Federation, is an
initiative that views the creation of a decarbonized society as an important management issue. Companies
participate if they are looking to develop innovative technologies early on and to implement them insociety. The goal is to realize a net zero greenhouse gas emission society as soon as possible, in line with the Paris Agreement. In cooperation withpartner companies, Hulic plans developing power generation and heat supply systems that use food waste from commercial facilities and hotels. The
system will be used in Company-owned properties to convert waste to energy, to achieve zero emissions, and to increase efficiency of operations.

Keidanren Biodiversity Declaration Initiative
External Evaluation

Basic
Strategies

In September 2015, the United Nations Summit unanimously adopted the SDGs as goals to beachieved by 2030. The SDGs consist of 17 goals in such areas as sustainable energy, the creationof a robust infrastructure, climate change countermeasures, and high-quality education.
Through our corporate activities, we address social issues and seek to find solutions. In concrete terms, we identify issues of great importance to us andour stakeholders as materiality issues, then implement measures to navigate relevant opportunities and risks.

Environmental Initiatives“Driving innovation and accelerating progress” as our motto, we continue to
steadily increase our corporate value through evolving ourselves flexibly inresponse to changes in macro environment

Social Initiatives

Target Profile
in 10 years

Corporate GovernanceParticipation in Initiatives

Data

Outline of Medium- and Long-term Management Plan (2020-2029)

Our Approach to Sustainability

Our Approach to Sustainability

Biodiversity conservation, along with efforts to address climate change and realize a recycling-oriented society, constitute themain pillar of Hulic environmental materiality issue. With the United Nations Decade on Biodiversity ended in 2020, Keidanren(Japan Business Federation) made a proposal to continue this initiative in the Japanese business community with the Keidanren
Biodiversity Declaration (revised edition) announced in June 2020. Hulic endorses and participates in this Keidanren initiative, andas a member of the international community, we will collaborate and cooperate with various stakeholders to resolve social issues.

Support of the Japan Business Federation’s One Percent Club Initiative
We support the One Percent Club initiative, a move advocated by Keidanren (Japan Business Federation). We are committing to spend at least one
percent of ordinary income on social causes every year.

Hulic Co., Ltd. Sustainability Book 20225

Issuance of Integrated Report and the Sustainability Book

Activities of Sustainability Supporters

We have been issuing the Integrated Report since 2020. In the Integrated Report, we describe how our strengths havebeen used to create value for customers, society, and the Company. We also present financial information and outline thesustainability initiatives which support our corporate growth in an easy-to-understand way for our stakeholders. The aimof the Integrated Report is to create the opportunity for a new dialogue. The Integrated Report is reviewed by the Boardof Directors prior to being issued. Further, Hulic compiles sustainability initiatives aimed at realizing a society full of safety,
peace of mind and trust, and for the continuous improvement of corporate value in the Sustainability Book as well as on
the Hulic website.

Approximately 20 employees are appointed from Hulic Group companies as sustainability supporters. During a oneyear term as sustainability supporters, they play a central role in social contribution activities that include hostinga summer festival, conducting satoyama conservation activities, considering where to donate employee match gift
program and sorting used stamps. Additionally, sustainability supporters assist the Corporate Sustainability Departmentin the promulgation and inculcation of the Hulic Sustainability Vision into the entire Group. At sustainability supporter
meetings, opinions are proactively exchanged and proposals submitted that contribute to sustainability initiatives and theformulation of action plans.

Integrated Reporthttps://www.hulic.co.jp/en/ir/library/annual/

Environmental Initiatives

WEB

Organizational Structure
Establishment of the Sustainability Committee
Sorting used stamps

Social Initiatives

We have established “Sustainability Committee” (the Committee). The Committee will discuss and coordinate material management mattersrelating to strengthening of our long-term competitiveness and risk management reflecting discussions and developments associated with ESG
and SDGs in Japan and around the world.
The President chairs the Committee as commitment of top management is of upmost importance in successful medium and long-term
engagements. Other members of the Committee include Vice President, General Managers of Business Planning and Management Department,
Real Estate Planning Department, and Group company executives.
Further, based on TCFD recommendations, we established a governance mechanism under which the Sustainability Committee deliberates
and coordinates matters related to climate change. The Committee evaluates the impact of climate change on business at least once a year,
formulates policies and strategies for mitigating identified risks and seizing opportunities, and discusses how to adapt to climate change,
including reflecting its impact in plans, budgets and targets. The Committee also sets KPIs related to sustainability, including climate change,and evaluates progress by reviewing performance. The Sustainability Committee submits reports on the deliberation of matters related toclimate change at least once a year to the Board of Directors, which oversees the committee.

Our Approach to Sustainability

Our Approach to Sustainability

External Evaluation

Data

Corporate Governance

Organizational Structure

6

Hulic Co., Ltd. Sustainability Book 2022

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7

For the realization of a society full of safety,
peace of mind and trust,and for the continuous improvement ofcorporate value

E Environment-related issues

S Social issues

G C
 orporate governance-related issues

Actions for climate change
Efficient use of resources
Promotion of the ecosystem
protection and restoration
Enhancement of environmental
management system

Provision of safe and secure buildings
Provision of healthy and comfortable lifestyles
Coexistence with business partners / local communities
Response to aging society
Response to increasing number of tourists
Striking a work-life balance and advancement of talent development
Advancement of diversity and inclusion and respect for human rights
Practicing sustainable agriculture

Corporate governance and compliance
Response to changes in financial and real estatemarkets
Business continuity plans (BCPs)

Growth Strategies and Business Activities

Strengths Created from Selection and Concentration*1

Achievements of Business Activities

Properties in prime locations(Manufactured capital)

Driving Innovation and Accelerating Progress• O rdinary Income JPY109.5 billion

Asakusa• Approx. 75% of Hulic’s properties are in Tokyo 23 wards

Average rate of growth of Ordinary Income: 21.3%(excluding residential and related properties)

Balanced Management•Approx. 80% of properties are within a 5-minute walkof a station (excluding residential and related property)

A small group of elite professionals

Strike a balance between P/L Growth, Profitability, B/SSoundness, and Productivity (efficiency) at a high level(Human capital)• E mployees (consolidated basis): 1,496

Business Activities(of which, 297 are in the real estate business)• H igh ordinary income per employee
Initiatives in advanced technology development

Leasing Business

Development Business• ROE

12.3%• Dividend Payout Ratio

38.5%• Dividends per share

JPY39.0• Net D/ E Ratio

1.3 times*3• Debt /EBITDA

9.0 times*3(Intellectual capital and natural capital)

Non-financial achivements

Guidelines for Longer Life Building• Introduction of natural ventilation and natural lighting

Targets were achieved for;systems that were developed with MIT

New and other
Businesses

Value-added BusinessStable financial basefor electricity consumption at all company-owned buildings*4
and achieving RE100*5■ Developing environmentally conscious and energy-savingbuildings■ Protecting the global environment by introducing
environmental technology

Peace of mind and trust for customers■ High environmental performance buildings with particularemphasis on earthquake and water damage■ Extending the lifespan of buildings■ Active development of businesses in response to demographic

change (aging) and social dynamics (increasing tourists)■ Workplace rich in diversity and inclusion■ Workplace with work-life balance■ Providing career development support• RE100* progress rate
• Percentage of technical measures applied to5• N umber of renewable energy systems installed indevelopment and reconstruction projects

AA- (stable)• Number of greening projects• Number of times climate change risks are(as of May 9, 2022)

JPY637.7 billion

Sustainability Initiatives

36.8%*3

Strong relationships with local communities,business partners(Social capital)• P ublic-private coordination in PPP business• C oordination and cooperation with management andconstruction companies• C orporate culture that fosters robust social contribution

monitored by the Sustainability Committee
and reported to the Board of Directors

to support business

Peace of mind and trust for investors■ Achieving stable financial growth■ Increased dividends every fiscal year since TSE First Section

listing■ Providing diverse forms of mutual communication• Percentage of properties meeting Hulic's

E

S

G

E (environmental)
initiatives

S (social) initiatives

G (governance)
initiatives

earthquake-resistance standards• Usage rate of paid leave• Ratio of female managers• Employment ratio of persons with disabilities• Number of BCP drills, inspections of stockpiled
food and suppliers

Peace of mind and trust for local
communities and business partners

External Evaluation• E quity:• E quity ratio:■ Converting to a 100% renewable energy sourced electricity

reduce construction waste(Financial capital)• C redit rating:

SDGs contributed toPeace of mind and trust for employees• Formulation and thorough implementation of the Hulic• Operational improvement using AI and IoT technologies

Peace of mind and trust for society as a whole

Data• Approx. 260 properties owned or under management• Focus areas: Ginza, Shinjuku East Side, Shibuya / Aoyama,

Financial achievements*2

Value Created for Society

Social Initiatives

Materiality identified from social issues

Corporate GovernanceThrough our business activities based on our strengths created from selection and concentration strategy, we strive to contribute realizing asociety full of safety, peace of mind and trust by providing products and services that are essential to our customers' social activities while aiming
for the continuous improvement of corporate value.

Environmental Initiatives

Hulic Group’s Value Creation Process

Our Approach to Sustainability

Our Approach to Sustainability■ Contributing to positive long-term relationships■ Contributing to resolution of issues in local communities■ Providing broader social contribution activities

activities*4 Excludes properties for which we do not have energy management*1 As of December 31, 2021
*2 FY2021 results*3 50% (JPY175 Bln) of all hybrid finance raised in 2018 and 2020combined (JPY350 Bln) was calculated as nominal equity.

8

Hulic Co., Ltd. Sustainability Book 2022

authority including master lease properties, residential properties andContinue evolving for further progress

non-managerial co-ownership properties, and reals estate for sale.
*5 RE100: An abbreviation of “Renewable Electricity 100%”, or sourcing 100%of electricity needed for business activities from renewable energy sources
Hulic Co., Ltd. Sustainability Book 2022

9

Our major stakeholders and related materiality

Hulic has been providing properties with excellent safety, environmental features, and convenience that match the

We are committed to realizing a sustainable society by delivering environmental, social and economic value through interactive

needs of the times and society.

Engagements with stakeholders. Stakeholders who are particularly important for our sustainable growth and relevant materiality

As social issues and stakeholders' interests diversify, we will continue to address issues in society through assessing

issues are indicated below.

opportunities and risks in our businesses to achieve sustainable growth.
Classification

Major engagements(frequency in parentheses)

Key stakeholders

Materiality Assessment•

Step 4

Identification of social
issues

Evaluation ofmateriality

Identification ofmateriality

Discussion and confirmationby the management

Analyze global social
issues* and ESG trends
to identify a wide range
of environmental, social,and economic issues

Quantify and evaluatesocial issues from theviewpoint of their impact
on stakeholders andHulic's management,
then prioritize

Assess and identify
materiality based on thetwo criteria: importanceto Hulic and to its
stakeholders

Identified materiality are
examined and confirmed
at management meeting•

Tenants
Facility users

Customers

Building managementcompanies• Construction
companies• Building maintenancecontractors• Real estate agents• Financial Institutions•

Business
Partners

Regular meetings and businessinteraction (as required)• Disclosure of information in ourIntegrated Report and on our website(when appropriate)•

Coexistence with business partners /local communities• Response to changes in financial andreal estate markets•

We will continue to review the identified materiality issues and implement effective initiatives and actions.
Disclosure of information through thecompany intranet (when appropriate)• President’s message (monthly)• Career development interviews (twice ayear or more)• President’s survey (twice a year)••

Materiality Matrix
Employees

We mapped issues of importance to Hulic and to our

Actions for climate change

Relevance (high)Identified
materiality

E

Efficient use of resources
Promotion of the ecosystem protection and restoration
Enhancement of environmental management system
Provision of safe and secure buildings

Social contribution activities andvolunteer activities (when appropriate)• Participation in neighborhood
associations (when appropriate)• Engagement with communities inthe vicinity of our projects (whenappropriate)• Engagement with NPOs and NGOs
(when appropriate)•••(classified by ESG)

Local communities
NPOs and NGOs

Local
Communities

Provision of healthy and comfortable lifestyles
Coexistence with business partners / local communities

Promoting PPP business (whenappropriate)• National and local public• Initiatives for various awards andbodiesevaluations (when appropriate)• Payment of appropriate taxes (whenappropriate)•

Coexistence with business partners /local communities

Actions for climatechange• Efficient use ofresources• Promotion of theecosystem protection
and restoration• Enhancement ofenvironmental
management system•* We are actively working
on environment-related
issues and business
continuity plans (BCPs),as they are materiality
issues that affect society
as a whole.

•

Response to aging society
Materiality for Hulic

S

Response to increasing number of tourists
Striking a work-life balance and advancement of
talent development

Administrative
Organizations

Advancement of diversity & inclusion and respect forhuman rights•

Practicing sustainable agriculture
Corporate governance and complianceG

Response to changes in financial and real estatemarkets
Business continuity plans (BCPs)

Hulic Co., Ltd. Sustainability Book 2022

Briefings for individual investors andfor analysts and institutional investors(including overseas) (when appropriate)• Timely disclosure of information on our
website (when appropriate)• Establishment of a contact point forinquiries (permanent)• Issuing a shareholder newsletter (twicea year)Coexistence with business partners /local communities• Advancement of diversity and inclusion
and respect for human rights•••

Shareholders,
Investors

Individual investors
Buy-and-hold investors•

External Evaluation

Relevance (high)10

Striking a work-life balance andadvancement of talent development• Advancement of diversity and inclusion
and respect for human rights•

Identifying Materiality

stakeholders, identifying high priority issues as materiality.

Materiality for our stakeholders

Employees of the Hulic
Group

Materiality
relevant to all
stakeholders

Social Initiatives

Step 3•

Data

Step 2

Environmental Initiatives

Customer satisfaction survey (annually)
Disclosure of information in ourIntegrated Report and on our website(when appropriate)• Establishment of a contact point forinquiries (permanent)•* SDGs, Global Risk Report
2019, etc.

Provision of safe and secure buildings
Provision of healthy and comfortable
lifestyles• Coexistence with business partners /local communities• Response to aging society• Response to increasing number oftourists• Practicing sustainable agriculture••

Step 1

Materiality of high relevance

Corporate GovernanceMateriality Assessment

Our Approach to Sustainability

Our Approach to Sustainability

Corporate governance and compliance

Hulic Co., Ltd. Sustainability Book 202211

Opportunities and Risks related to Materiality and Our Actions
Materiality

Major Opportunities and Risks (〇: opportunities, ●: risks)

Hulic’s Major Initiatives and Actions

SDGs contributed toInitiatives to achieve RE100 by 2024 and to convert to a 100% renewable energy for electricity consumption at all Company-owned
Buildings* by 2030 and investment in renewable energy• Information disclosure based on TCFD recommendations, Formulation greenhouse gas emissions reduction targets in conformancewith 1.5˚C route (Acquired SBT certification)• Reducing CO emissions and promoting forest circulation by developing fireproof wooden buildings
2• Active adoption of environmentally friendly technologies (natural ventilation and natural lightning systems developed as a result ofresearch/development project that Hulic engaged in with MIT, etc.)

Take actions for climatechange〇 Heightened need for buildings and properties equipped with higher energy efficiency and renewable energy● Need for additional measures to comply with environmental regulations. Increase of utility expenses due to a rise inenergy consumption for air conditioning

Promote efficient use ofresources〇 Heightened need for facilities utilizing resources effectively and recycling technologies● Risk that business activity may wane if resources were exhausted

Promote the ecosystem
protection andrestoration〇 Heightened need for real estate development that is mindful of conserving local ecosystems● Residential environment may deteriorate if ecosystem in vicinity of property was damaged

Enhance environmental
management system〇 Creation of new business opportunities through taking actions against environmental issues as our core business● Risk of delayed action on environmental issues due to lack of environmental management system

Deliver safe and securebuildings〇 Heightened need for properties that are safe and secure from natural disasters including earthquakes and flood damage● Rise of vacancy rate and decline of real estate value due to delayed actions on earthquake resistance techniques and
BCP preparedness

Deliver healthy andcomfortable lifestyles〇 Heightened need for comfortable, healthy and productive indoor environments● Reputational risk if health damage occurred in one of Hulic’s buildings

Coexistence withbusiness partners / local
communities〇 Better results are expected through synergies brought by aiming for mutual sustainable growth with our business
partners and local communities● Our reputation may suffer and relationships may deteriorate if we neglected local connections

Respond to aging society〇 Heightened need for nursing homes and hospitals with the aging of society and increase in number of healthier seniorcitizens● Hiring-related costs may rise and shortage of care workers may materialize as the population of young generation
declines

Respond to increasing
number of tourists〇 Expected rise in need for accommodation over the medium- to long-term● Risk of losing hotel guests if we failed to respond to diverse tourist needs

Strike a work-life balance
and advance talentdevelopment〇 Improvement of employee motivation and brand value in talent acquisition by enhancing workplace wellness featuresand enriching talent development program● Turnover rate may rise if support programs were insufficient for various workstyles

Advance diversity andinclusion and respect forhuman rights〇 Improvement of operational quality and productivity can be achieved by respecting diversity and inclusion● Reputational risk may rise if we failed to respond to the need for diversity and inclusion•〇 Heightened need for low-cost, high-quality agricultural products at developing countries due to decline in Japan’s
farming population● Increase of investment costs in response to climate change and changing market conditions•

Practice sustainableagriculture

Further strengthen
corporate governanceand compliance〇 The effectiveness of operations is ensured and confidence in management improves when internal controls andcorporate governance work
● Non-compliance issue and deterioration of public confidence may occur due to lack of appropriate compliance culture
and system

Adoption of longer life building design
3R (Reduce/Reuse/Recycle) initiative (adoption of PC construction method, reuse of construction materials, reduction of plastic waste)• Development and adoption of technologies to make effective use of resources
•

•
•

•
•

Environmental Initiatives•

Use of labelling systems including JHEP certification, etc.
Promotion of greening in development projects

Oversight of the Board of Directors and setting up a corporate governance mechanism centered on the Sustainability Committee
Establishment and implementation of long-term vision for environment with targets for 2050

Declared ensuring all Company-owned buildings can withstand a seismic intensity of 7 level by 2029 (active adoption ofearthquakeabsorbing and earthquake-damping structures)• Comprehensive assessment of natural disaster risks at all Company-owned buildings•

Social Initiatives

Environment•(Initiatives in business) Delivering a healthy and comfortable indoor environment, confirming specifications of facilities and interiormaterials in existing properties and those under development (use of interior finishes and equipment containing no hazardous
substances)• (Initiatives for employees) Promotion of health and productivity management (introduction of no-smoking hours, medical checkups on
par with examinations that exceed legal requirements, etc.)〇 The Company's prompt response to market changes differentiates itself from competitors● Decline of real estate leasing revenue, rise of vacancy rate
● Higher funding costs

Enhance business
continuity plans (BCPs)〇 A sense of security for employees and their families may be delivered through taking stronger measures to ensure
safety in case of a disaster● Delayed resumption of business due to prolonged restoration of head office functions•

Establishment of long-lasting good relationships through close and continuous mutual communications ((Tenants) Implementationof customer satisfaction surveys, delivering meticulous response to tenant needs (Business partners) Establishment of close
communications with management and construction companies (Local communities) Donating books to an elementary
school near the Hulic head office building, neighborhood cleanup activities, etc.)(Initiatives in business) Promotion of senior citizen-related businesses (development of and investment in nursing homes)(Initiatives for talent acquisition) To secure a stable workforce, improve fringe benefits and rehire seniors who want to work
• (Social contribution) Operation of Hulic Scholarship Program for Training of Welfare Caretakers

Corporate Governance

•
•

•
•

Promotion of tourism-related business (owned/leased, or managed by the Company)
Responses to the diverse needs of tourists by offering a wide range of lodging options (owned/leased: a wide range of business-oriented
and luxury hotels in selected locations; Hulic-managed: primarily upscale hotels and luxury hot spring inns)

Provision of supporting framework for employees during pregnancy, childcare and caring for the elderly, and raising awareness on related programs
Advancement of work style reform and thorough tracking of work hours as a corrective measure to change long working hour culture• Enhancement of support program for obtaining qualifications and in-house training program••

Raising awareness of diversity and inclusion, as well as developing various programs and systems
Initiatives to establish a talent management system that recognizes various work styles including work from home
• Employment of diverse human resources

Data

•

Promotion of agricultural business with a company in Vietnam
Strengthening of cooperation with and introduction of new technologies with domestic agricultural companies through investments• Information gathering on new crop varieties through joint ventures and implementation of trial cultivation of multiple varieties
throughout the year•

Appointment of external directors / auditors with knowledge in a variety of specialized fields
Establishment of a nomination committee and a compensation committee (all members are independent external directors) / Transition toa system whereby a non-executive director serves as chairperson of the Board of Directors• Provision of compliance trainings for all employees / establishment of compliance hotlines••

External Evaluation

Corporate GovernanceSocial•Respond to changes infinancial and real estatemarkets

Our Approach to Sustainability

Our Approach to Sustainability(Real estate markets)
Maintenance and improvement of competitiveness through adding value to our properties by redevelopments, renovations, etc.
• Careful selection of investment projects / flexible rebalancing of portfolio mix(Financial markets)• Establishment of cooperative relationships with financial institutions, procurement policy (raise long-term funds at fixed rates)• Periodic analysis of market conditions, implementation of rigorous risk management through careful deliberation and reporting at in-house meetings•••

Formulation of BCP, implementation of drills once or more each year
Establishment of cooperative program with external parties to examine situations and implement response measures on Company
properties in times of disaster*All company-owned buildings:Excludes properties for which we do not have energy management authority including master lease properties, residential properties and non-managerial co-ownershipproperties, and reals estate for sale.

12

Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022

13

Our Approach to Sustainability” have been assured by an independent assurance provider.

Social Initiatives

Environmental Initiatives

Note: Figures marked with “

Our Approach to Sustainability

Non-financial Highlights

External Evaluation

Data

Corporate GovernanceThis page is intentionally left blank.
The Key Performance Indicators (KPIs) /Targets and Results start from the next page.

*1 The greenhouse gas emissions are calculated based on the GHG Protocol. The boundary for Scope1 and 2 is the properties where the Hulic Group has control of energy management(30 properties in FY2019, 36 properties in FY2020, and 41 properties in FY2021). The unit calorific values and the emission factors are based on values in the Act on the Rational Use ofEnergy and the Act on Promotion of Global Warming Countermeasures. Until FY2020, greenhouse gas emissions from one hotel operated by a subsidiary were calculated based on ourownership ratio in that property, but starting in FY2021, emissions are calculated based on operational control. As a result, energy consumption and greenhouse gas emissions increasedby 55TJ and approximately 2,600 t-CO2e, respectively, compared with calculations based on the ownership ratio. The boundary and calculation method for Scope3 are disclosed on our
website: https://www.hulic.co.jp/sustainability/ecology/warming/pdf/scope3.pdf*2 Beginning in FY2020, we are calculating total waste disposal at specific properties within the boundary by using weight conversion factors based on actual measurements.
*3 Beginning in FY2021, 220 of Hulic’s fixed assets are covered, excluding properties under development and land for lease. Note that the amount of hot spring water used at hot springinns is not included.
*4 Hulic’s earthquake-resistance standards are where building performance can safeguard human life and enable continued use of the building with post-earthquake repair in the event ofan earthquake with a seismic intensity of 7 level.
*5 Our target for the employment ratio of persons with disabilities is to be at the statutory employment ratio or higher: 2.0% or higher until 2017, 2.2% or higher from 2018 to 2020, and2.3% or higher from 2021 onward.

14

Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022

15

Key Performance Indicators (KPIs) /Targets and Results
Figures marked with “ ” have been assured by an independent assurance provider. For FY2021 results, we received assurance from an independent assurance provider
concerning the following items: total energy consumption; greenhouse gas emissions Scope1, greenhouse gas emissions Scope2, greenhouse gas emissions Scope3; waste
disposal; water consumption; number of greening projects; percentage of employees who received medical checkups; usage rate of paid leave; and employment ratioof persons with disabilities. We will continue to disclose information on the progress of our sustainability initiatives to the stakeholders while strive to improve disclosure
quality using PDCA cycle.
Results for KPIs are shown from the year they were set as KPIs and indicated as a “–(dash)” for earlier years.

Hulic’s Materiality

KPIs / Short-term Targets, Medium- to Long-Term Targets

Environment

Promote efficient use of resources—

RE100 progress rate*2: 10% in 2021, 30% in 2022, 65% in 2023, 100% in 2024

Electricity used in Hulic Group business activities

—

—

—

Number of renewable energy systems installed in development and reconstruction projects: at least three every year

All completed properties each year

4

6

4

Waste disposal: No numerical target (follow-up item)*3

6 buildings occupied by the head offices of
Hulic and its Group companies*4

611

1,166

904

All completed fixed assets each year

—

—

—

5

Percentage of technical measures (such as longer life design, etc.) * applied to reduce construction waste: 100%
each year

7

6

220 major properties*

93

Number of times climate change risks are monitored by the Sustainability Committee and reported to the Board of
Directors: 1 or more each year

Hulic Co., Ltd.

—

—

—

Number of Environmental Advisory Council meetings held: 1 or more each year

Hulic Co., Ltd.

——

Percentage of properties meeting Hulic's earthquake-resistance standards*8: 100% each year

All completed properties each year

SocialCorporate
Governance
16

Implement balanced
management with attention togroup governance

〇

13.5%

%

◎

property◎

metric ton

—

%

◎

3

thousand m—property

◎

1/2

time

◎

1

time

◎

%

◎

0.5%
3 (8 properties inboundary)

8 (8 properties inboundary)

502
100% (8 properties
in boundary)

502
100% (8 properties
in boundary)346
5(8 properties inboundary)

1,487
6 (8 properties inboundary)1/—1100% (8 properties
in boundary)

100% (8 properties
in boundary)

—

—

—

81.1%

%

〇

100%

100%

100%

%

◎

Hulic Group

1

1

1

1

1

time

◎

Hulic Group (including properties sold/trusted
to REIT)

—

—

3,400

3,600

3,700

room

〇

—

—

8,200

8,000

8,000

room

〇

100% ／
0 people

100% ／
1 people

100% ／
7 people

100% ／
3 people

100% ／
5 people

Respond to aging society

Nursing homes Number of units: 5,000 in near future

Respond to increasing number of tourists

Accommodation facilities Number of rooms: 10,000 in near future

Enhance business continuity plans (BCPs)

t-CO₂e100%

Number of customer satisfaction surveys: 1 or more each year

Respond to changes in financial and realestate markets

1
100% (4 properties
in boundary)

Scope1
11,369
Scope2
17,473
Scope3
210,703—

Coexistence with business partners / local
communities

Usage rate of childcare leaves / Number of people: 100% of eligible female employees /1 male employee or moreeach year

100% (6 properties 100% (11 properties
in boundary)in boundary)FY2021

Scope1
10,490
Scope2
18,529
Scope3270,066

100%

Hulic-owned fixed asset
Hulic Co., Ltd.

Further strengthen corporate governanceand compliance

437

5Percentage of employees who received medical checkup*10: 100% each year

Practice sustainable agriculture420

All completed properties each year

Deliver healthy and comfortable lifestyles

Promote diversity and inclusion andrespect for human rights

436

Number of greening projects* : 1 or more each year

Progress toward a 100% ratio of highly earthquake resistant buildings*9 in 2029

Strike a work-life balance and advancetalent development

FY2020—

Deliver safe and secure buildings

Promote business operations
with particular emphasis on
improving earthquake resistanceto build a more resilient society

FY2019

Greenhouse gas emission reduction targets*1:
2024 Scope1 +2 70%; 2030 Scope1+2 70%, and Scope3 30%;2050 Scope1+2 and 3 substantially net zero (base year: 2019)

Water consumption: No numerical target (follow-up item) *Enhance environmental management
system

FY2018

Scope1
14,931
Scope225,067
Scope3229,0063

Promote the ecosystem protection andrestoration

FY2017(◎:achieved, ○:progressed, △:notprogressed, ―:not subject toassessment)

Unit

Scope1 and 2
Properties where the Hulic Group has control
of energy management*1
Scope3
Indirect emissions other than Scope1 and 2
related to Hulic Group’s business activities*1

Take actions for climate change

Promote carbon-free society
initiatives through building
operations

Assessment

Results

Coverage(If no fiscal year is given for a target, the target remains effective every year)

Hulic Co., Ltd.

% ／ people◎

Ratio of employees returning to work after childcare leaves: 100% per year

Hulic Co., Ltd.

100%

100%

100%

100%

100%

%

◎

Usage rate of paid leave*11: 70% or higher each year

Hulic Co., Ltd.

78.3%

77.0%

78.5%

75.5%

81.5%

%

◎

Percentage of career development interviews conducted: 100% in every year (conducted twice a year)

Hulic Co., Ltd.

—

—

—

—

100%

%

◎

Ratio of female managers: 2020; 20%, 2024; 25%, 2029; 30%

Hulic Co., Ltd.

15.6%

18.5%

20.2%

23.9%

22.4%

%

〇

Number of seminars provided by the Diversity Promotion Project Team: once each year

Hulic Co., Ltd.

1

1

1

1

time

◎

Employment ratio of persons with disabilities: Maintaining the statutory employment ratio or higher (The statutory
employment ratio was 2.0% or higher in and before 2017, and 2.2% or higher between 2018 to 2020, and is 2.3% Hulic Group*13
or higher from 2021 onward.)

2.11%

2.41%

2.42%

2.54%

%

◎

1*12
2.34%

Production area: 15ha by 2025

Hulic Group

ー

ー

11

10

13

hectare〇Participation rate in Board of Directors meetings: 80% or higher each year

Hulic Co., Ltd.

97.3%

98.0%

99.1%

98.7%

99.6%

%

◎

Number of effectiveness assessment of the Board of Directors: once each year

Hulic Co., Ltd.

—

—

—

1

1

time

◎

time

◎

time

◎

time

◎

Number of compliance training conducted: Five times each year (4 times for employees and once for officers)

Hulic Co., Ltd.

Number of Risk Management Committee and Fund and ALM Committee meetings: 4 times each year, respectively

Hulic Co., Ltd.

Number of BCP drills and inspections of stockpiled food and goods: 1 or more each year

Hulic Group5 (4 employees,
1 officer)—
1

5 (4 employees,
1 officer)—
1

5 (4 employees,
1 officer)
4/13
1

5 (4 employees,
1 officer)

5 (4 employees,
1 officer)

4/22
1

4/16
3/4/1*

14*1 The greenhouse gas emissions are calculated based on the GHG Protocol. The boundary for Scope1 and 2 is the properties where the Hulic Group has control of energy management (30properties in FY2019, 36 properties in FY2020, and 41 properties in FY2021). The boundary and calculation method for Scope3 are disclosed on our website:
https://www.hulic.co.jp/sustainability/ecology/warming/pdf/scope3.pdf.

*7 The number of completed properties in each year among those imposed with greening obligation (excludes real estate for sale).

*2 The RE100 progress rate is calculated by dividing the total amount of power generated by Hulic-owned solar photovoltaic equipment in the year by the projected total amount of electricity
used at the Hulic head office building and on the floors occupied by Group companies in 2024.

*9 Highly earthquake resistant buildings are those that can safeguard human life and enable continued use of the building with post-earthquake repairs when an earthquake occurs with aseismic intensity of 7 level.

*3 To be comprehensive when making calculations for waste disposal and water consumption, we are preparing basic data to change the boundaries for aggregation of this data. As 2020 and
2021 are the transition period for this change, we have not set any quantitative targets.

*10 The executive officers, employees (including seconded staff) and full-time contract staff who were with the Company at the time of application of medical checkup and as of December 31,
2021 were counted (excluding personnel who were on leave).

*4 The boundary is Hulic’s head office building and buildings where the head offices of Group companies are located. Beginning in FY2020, we are calculating total waste disposal at specificproperties within the boundary by using weight conversion factors based on actual measurements.

*11 The usage rate of paid leave is calculated by dividing the number of days of paid leave used in the year by the number of days of paid leave granted in the year. The number of days carriedover in the year are excluded.

*5 The percentage of properties completed in the given year that used technologies and measures that contributed to a reduction in waste as well as raw materials and other resources based on
the Hulic Guidelines for Longer Life.

*12 Limited to Hulic Co., Ltd. and subsidiary companies that have been certified as special subsidiary companies under the Act on Employment Promotion etc. of Persons with Disabilities. The
employment ratio for persons with disabilities is as of June 1st of each year.

*6 Beginning in FY2021, 220 of Hulic’s fixed assets are covered, excluding properties under development and land for lease. Note that the amount of hot spring water used at hot spring inns is
not included.

*13 In FY2020, a video training session was held in lieu of an in-person seminar session to prevent the spread of COVID-19.

Hulic Co., Ltd. Sustainability Book 2022

*8 Hulic’s earthquake-resistance standards are where building performance can safeguard human life and enable continued use of the building with post-earthquake repair in the event of anearthquake with a seismic intensity of 7 level.

Environmental Initiatives

Initiatives in theMedium- and Long-Term
Management Plan, by ESG

Social Initiatives

Classified
by ESG

Corporate Governancefinancial information KPIs / targets and results, classified by ESG, are shown below.

Data(KPIs) / targets, we are addressing to achieve both financial and non-financial aspects with the same amount of importance. Non-

External Evaluation

We aim to increase our corporate value and solve social issues simultaneously. Therefore, with respect to key performance indicators

Our Approach to Sustainability

Our Approach to Sustainability*14 Beginning in FY2021, the number of BCP drills, inspections of stockpiled food and suppliers are disclosed, respectively.
Hulic Co., Ltd. Sustainability Book 2022

17

ESG

Hulic contributes to achieving a sustainable society by
executing environmentally friendly management aswell as by addressing global environmental issues.

Our Approach to Sustainability

Environmental Initiatives

Collaboration with External Organizations
Hulic implements environmental initiatives focused on climate change
while actively collaborating with relevant government agencies andindustry groups and engaging in partnerships with NPOs and otherprivate organizations.
There are no discrepancies or conflicts between each industry group

The Real Estate Companies Association ofJapan

The Real Estate Companies Association of Japan (RECAJ) is an organization comprising
companies engaged in urban development and the creation of appealing cityscapes. RECAJ
contributes to the SDGs and is engaged in environmental initiatives for the real estateindustry. As a member of the RECAJ Environmental Committee, Hulic regularly participatesin initiatives related to eliminating environmental degradation.

Fuyo Kondankai Environmental BusinessCouncil

The Fuyo Kondankai Business Council holds regular meetings to introduce environmental
technologies, presents lectures by experts and engages in other efforts aimed at creatingand expanding environmental business opportunities.

Wood Change Council

Hulic engages in ongoing lumber promotion activities through participation in Wood
Change Council, a networking gathering sponsored by Japan’s Forestry Agency to promote
the use of lumber in residential and other construction projects.

Japan Economic Research InstituteThis private research institute publishes data and makes recommendations based on
proprietary research into economics and management issues. Hulic participates in the
Carbon Neutral Committee, where we engage in pragmatic discussions regarding privatesector support for the realization of carbon neutrality in 2050 and requests for thegovernment.

Japan Climate Leaders’ Partnership (JCLP)

Viewing preparations for the transition to a carbon-free society as an opportunity forcorporate development, this voluntary organization shares information on the latest trends
in Japan and overseas while recommending government policy proposals and disseminating
information throughout society from a corporate perspective.

TCFD Consortium

Hulic announced support for the TCFD recommendations and began disclosing informationin line with them. We also participate in the TCFD Consortium to promote the unified
efforts of companies, financial institutions and other organizations that endorse the TCFD
recommendations.

Keidanren Biodiversity Declaration Initiative

Biodiversity conservation, along with efforts to address climate change and realize a
recycling-oriented society, constitute the main pillar of Hulic environmental materiality
issue. With the United Nations Decade on Biodiversity ended in 2020, Keidanren (Japan
Business Federation) made a proposal to continue this initiative in the Japanese business
community with the Keidanren Biodiversity Declaration (revised edition) announced in June
2020. Hulic endorses and participates in this Keidanren initiative, and as a member of theinternational community.

Hulic Environmental Policy
Hulic has formulated the Environmental Policy embodied in our Sustainability Vision and is executing environmentally friendly management towork towards solving various issues in the global environment. The following items are clearly stated in our Environmental Policy.

❶ Environmental Compliance
We strive to create a sustainable society while adhering
to environmental laws and regulations.

❷ Environmental Management System
We contribute to the conservation of global environment
by setting environmental targets and making continous
efforts for improving them.

❸ Environmental Performance
We reduce as much of our environmental footprint as
possible by introducing eco-friendly designs from theplanning stage of development in order to increase
environmental efficiency.

❹ Recycling-oriented Society
We contribute to the creation of a recycling-oriented,
zero waste society, by executing the 3Rs, reduce, reuse,recycle, throughout the life cycle of buildings.

 nvironmental Awareness and Education for❺E
Employees
We provide environmental education and awarenessraising activities to employees so that everyone
can proactively work toward the improvement ofenvironmental performance.

❻ Environmental Communication
We extensively disclose information on environmental
contribution activities, and communicate withstakeholders including local communities to expand thecircle of global environmental conservation.

Consideration for Sustainability in Real Estate Development and Investment
Hulic is committed not only to sustainable real estate investment

impact on the surrounding living environment so that we can gainin accordance with the Corporate Philosophy and Sustainability

their understanding.

Vision, but has also formulated regulations on managing real estate

When outsourcing design and project management or orderingpurchases and development.

construction work, we generally hire companies with the solid

When conducting an investigation of the acquisition of real estate,technologies, credibility, and track records. In addition, when

Hulic always carries out statutory investigations and conduct

developing and reconstructing real estate, we issue instructions

studies on natural environment, specified hazardous substances,on environmentally friendly designs and check whether

and the presence of underground obstacles. In negotiations withenvironmentally friendly designs are adopted at the basic designingcommunities, we provide explanations to those who live nearby

stage, implemental designing stage, and completion stage.

Social Initiatives

Activity Details

Corporate GovernanceGroup Name

Data

Fundamental
Approach

Hulic will implement environmentally friendly management based on the Hulic
Environmental Policy and work to resolve issues associated with conservation of the global
environment.

External Evaluation

Basic Policy for Environment

Environmental Initiatives

and policies or the direction of our environmental efforts.

after conducting sufficient investigations and simulations on the18

Hulic Co., Ltd. Sustainability Book 2022

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19

Hulic has formulated the Environmental Policy embodied in our

2050.

Sustainability Vision and is executing environmentally friendly

We have decided to set the long-term vision for environment at the

management. We aim to continue sustainable growth throughcenter of our environment related initiatives considering the timebusiness activities, with analyzing and evaluating climate change

frame referred to in the Paris Agreement which was adopted in

mitigation and adaptation, and we are also implementing initiatives

2015 at COP21 (The 21st Session of the Conference of the Parties

to realize a carbon-free, recycling-oriented society envisioned into the United Nations (UN) Framework Convention on Climate

Hulic's Long-term Vision for the Environment with targets for

Change).

Example of Specific Initiatives● Converting to a 100% renewable energy forelectricity consumption at all Company-owned
Buildings and achieving RE100 : we have beendeveloping solar photovoltaic equipment that does
not use the FIT system.
● Longer life design buildings : we are reducing

waste by making our longer life design ofLong-term Vision for the Environmentbuildings that can accommodate tenant needs

Natural ventilation(HULIC Head Office Building)Nutural lighting louvers and LED lighting (HULICHead Office Building)flexibly and can be used safely over a 100 years

Hulic executes environmentally friendly management to realize an ideal society ofcarbon-free and recycling-oriented society in 2050.
As a real estate developer, we believe that Hulic can offer value to society by putting our environmental effort into reducing greenhouse gas
emissions, using resources efficiently, and reducing waste.

Roadmap of Long-term Vision for the Environment

as standard specifications in all developments andreconstructions.
● Fireproof hybrid wooden buildings : we havebeen developing and spreading fireproof woodenbuildings using timber that requires less energy for

Environmental
Environmental Initiatives
Initiatives

Long-term Vision for the Environment

Our Approach to Sustainability

Environmental Initiatives

manufacturing and processing as the construction
Photovoltaic panels (HULIC Head Office Building)material than steel and concrete as well as

Social Initiatives

contributes in fixing carbon.
● Environmentally friendly technologies : we havedeveloped unique natural ventilation and naturallighting systems (louvers) in collaboration with the
Massachusetts Institute of Technology. We havealso obtained patents for and are commercializing
photovoltaic panels, which were jointly developed
greening system, natural lighting films etc.

The solar photovoltaic equipment that does not
use the FIT system (Saitama Pref.)Japan's first 12-story wooden fireproof commercial
building (Ginza, Tokyo)

Environmental Compliancesubsequent formulation of environmental policies.

related to the environment, including waste and soil pollution,

There were no

the Hulic Group communicates to all employees information on

violations of

the latest trends in environmental laws and regulations and legal

environmental laws

systems, as well as our sustainability-related initiatives and actions

and regulations inincluding environment through the intranet.

the last six years

We use opinions raised during the compliance training in the(2016 ~ 2021).
Data

With the aim of thoroughly complying with laws and regulations

Corporate Governancewith another company, and a thin-layered wall

Major Environmental Laws and Regulations
・Act on the Promotion of Sorted Collection and Recycling of・Act on Promotion of Global Warming Countermeasures

Containers and Packaging (Containers/Packaging Recycling Act)・Act on the Rational Use of Energy (Energy Conservation Act)・Construction Waste Recycling Act

・Air Pollution Control Act

・Act on Confirmation, etc. of Release Amounts of Specific Chemical・Noise Regulation Act

Substances in the Environment and Promotion of Improvements to・Vibration Regulation Act

the Management Thereof・Soil Contamination Countermeasures Act

・Basic Law for Establishing the Recycling-based Society・Waste Management and Public Cleaning Act

・Industrial Safety and Health Act

・Act on the Promotion of Effective Utilization of Resources

・Act on Special Measures concerning the Proper Treatment ofExternal Evaluation

・Basic Environment Act

Polychlorinated Biphenyl Waste, etc.

20

Hulic Co., Ltd. Sustainability Book 2022

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21

system (EMS)* based on the Hulic Environmental Policy and isconstantly improving it through a PDCA cycle. We have recently

Measures to Enhance the Effectiveness of Energy Conservation Promotion Activities

Environmental Management System (EMS)

Act

Plan

strengthened our governance mechanism centered on Board of

Board of Directors

Director oversight and the Sustainability Committee with regard to・Oversee initiatives
・Instruct reviews andimprovements

climate change based on TCFD recommendations.

Corporate Sustainability
Department* There is no office that has obtained certification for an environmental management
system such as ISO 14001 or EMAS in the Group.

・Analyze and evaluate thecurrent status
・Formulate environmental
policies and measures
・Manage climate changerisks and opportunities
・Set KPIs

Hulic prepares a basic unit chart on the amount of energy usedconsumption for each individual year. The basic unit chart alsoannually per square meter at each of its Company-owned leasecalculates and evaluates electricity, gas, heat (steam, hot water,buildings in order to analyze and understand energy sourced fromcold water) and water usage for each tenant and facility. Going

outside each building is being used. The basic unit chart contains

forward, measures will be considered for how to utilize this data

data for each year from fiscal year 2010, which makes it possible

in more energy efficiency renovations and improved building

to evaluate current conditions and carry out more evaluates the

management practices.

supply of electricity conservation efforts by measuring energy

Introduction of Energy-saving Measures in Cooperation with TenantsContinual Improvement• Environmental risk mitigation and adaptation• Compliance with applicable laws and regulations• Energy and resource conservation• KPI management• Environmental reporting and communications

Based on the building’s electricity consumption for one year,

through more efficient operations, and implement small-scale

adjustments will be made with each tenant, then we examine

renovations as needed.

equipment settings and propose utility cost reduction measures

Check

Do

Sustainability Committee
Risk Management
Committee
Environmental
Advisory Council

Real Estate BusinessGroup companies Division

・Review and evaluate
initiatives regularly
・Evaluate climate change’s
impact on business andreflect in strategies
・Evaluate progress andperformance of KPIs

● Promoting the Visualization of Energy

・Implement business plans
with consideration for the
global environment
・Adopt environmentallyfriendly and energy-saving
technologies
・Develop and use renewableenergy・Collaborate with business
partners, etc.
・Respond to environmental
emergencies (BCPs)

Efforts to Reduce the Amount of Paper Use in Offices
To reduce paper consumption at the Company, we are callingon employees through the company intranet to reduce paper

Paper consumption per person (Hulic nonconsolidated)consumption, promoting both-side printing and intensive printing,and implementing the electronic circulation of documents and an

Social Initiatives

The Group has established a unique environmental management

Environmental Initiatives

Environmental Management System (EMS)

Our Approach to Sustainability

Environmental Initiatives

electronic approval system as required.
Additionally, we are promoting digitalization to improve work
efficiency, while transitioning to a paperless business flows in all
operations and meetings.

Corporate Governance

PLAN：Planning and Promotion of Environmental Issues
We will formulate response policies and measures based on our recognition of current environmental conditions, including the impact ofclimate change on Hulic's businesses. Further, we will set KPIs including but not limited to greenhouse gas emissions reduction targets andmanage the results.

CHECK：Confirmation and Inspection
Confirmation and inspection of initiatives through monitoring andExecute business plans in line with CSR Procurement Policy in collaboration with the Group companies, business partners, etc.

assessment by both in-house parties and external advisors in orderfor constant improvement of EMS.

Energy Conservation Promotion Activities for Our Leased BuildingsWEB

Sustainability Committee
https://www.hulic.co.jp/en/sustainability/about/philosophy.html#anc9
Risk Management Committee
https://www.hulic.co.jp/en/sustainability/governance/risk_management.
html#anc1

Activities to Promote Energy-saving Cooperation with

Adoption of Energy-saving Technologies

Building Management Companies

Hulic has actively worked on the promotion of energy savings,

Hulic has created an energy management standard, which it shares

use of renewable or unused energies, and greening promotion,with property management companies in charge of its properties,

etc. as part of measures for climate change in engaging in new

in order to rigorously manage the progress of energy conservation

development and managing

activities. The energy management standard was created toexisting buildings owned bypromote more efficient energy saving activities at buildings, and it

Hulic. In addition, we will

Continual improvements and oversight by the Board of Directors on environmental initiatives reflecting the results of in-house as well asserves as a guideline for management, measurement, recording,proactively introduce newexternal advisor's confirmation and inspection.

maintenance, and inspections related to the rationalization ofenergy-saving technologies

energy use based on building type and size. This standard applies

and improvements of existing

to all forms of energy, including electricity, gas, and water (water

performance. In addition, Hulicand sewerage).

will conduct its own research

Environmental Advisory Council
https://www.hulic.co.jp/en/sustainability/ecology/tcfd/governance.
html#anc5

External Evaluation

ACTION：Review and Improveand development on energyWEB

Initiatives for Energy Conservation
https://www.hulic.co.jp/en/sustainability/ecology/warming/efficiency.html

Data

DO：Operations

saving technologies.

Effective Use of Unused Energies
https://www.hulic.co.jp/en/sustainability/ecology/warming/unused.html

22

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23

Sustainability-Linked Bonds

We work on environmental education and awareness activities in order to enable each employee to voluntarily act toward the improvement

Hulic has issued Japan’s first Sustainability-Linked Bonds (“theThe Bonds are the world’s first publicly offered Sustainability-Linkedof environmental performance.

Bonds”) in October 15,2020.

Bonds that align with the “Sustainability Linked Bond Principles”

For the issuance of the Bonds, the Company applied for “the(“SLB Principles”) published by The International Capital Market

Public Offering for Model Cases in the Model Creation Projects on

Association (“ICMA”) (as of the date of this announcement).

Sustainability Linked Loans 2020” launched by the Ministry of the

In February 2021, we received the silver prize as well as theEnvironment (the “Public Offering”) and the Bonds were highly

Minister of the Environment award in the issuer category of theEnvironmental Education
Satoyama Conservation Activities
The Hulic Group participates every year in the Tokyo Green Ship

weeds and shrubs at the foots of mountains. These activities, withevaluated for the modeling and pioneering features and selected

second ESG Finance Award Japan hosted by the Ministry of the

Action, organized by the Bureau of Environment of the Tokyo

participation by many employees every year, provide them goodas the first model case in the Public Offering.

Environment for this bond issuance.

Metropolitan Government, to raise environmental awareness, andopportunities to learn about biodiversity.

engages in volunteer activities such as rice harvesting and trimming

Third-party verification
The compliance of the bonds with the Ministry of Environment
Guidelines and SLB Principles has been confirmed by the Ministryof Environment and its contractors (JCR, E&ES).
Progress against the targets is reviewed annually by JCR.

WEB

Pre-issuance report (Japanese).
https://www.hulic.co.jp/sustainability/ecology/management/pdf/
report_202008.pdf
Post-Issuance Verification Report (Japansese, issued in August 2021)
https://www.hulic.co.jp/sustainability/ecology/management/pdf/
report_202108.pdf

Environmental Initiatives

Environmental Awareness and Education for Employees

Our Approach to Sustainability

Environmental Initiatives

Overview of the Bonds

New Hire Training
development and environmental efforts such as fireproof wooden

joining the company includes detailed explanations regarding theconstruction initiatives, all in an effort to inculcate awareness ofdevelopment of renewable energy equipment, the introduction

the environment as soon as new employees are hired.

of longer life designs and eco-friendly technologies into building

Afforestation Training
Hulic's policy is to plant trees used for fireproof wooden buildings

10th series unsecured subordinated bonds (with an inter-bond pari passu clause, Sustainability-Linked Bonds)
Maturity
Issue amount

10 billion yen

SPTs linked with
the issue terms①Achievement of RE100 by 2025
②Completion of Japan's first 12-story fire-resistant wooden commercial facility in the Ginza 8-chome Development
Plan by 2025
*The Bonds set out additional SPTs subject to monitoringas an initiative promoting forest regeneration to realize a recyclingInterest rate

An interest rate of 0.44% per annum will be applied during the period from the day immediately following October
15, 2020 through October 15, 2026.
A coupon step-up of 0.10% is triggered if any of the SPTs linked with the issue terms has not been achieved as ofAugust 31, 2026

Pricing date

October 9, 2020

Issue date

October 15, 2020

Maturity date

October 15, 2030

Credit rating

A+ (Japan Credit Rating Agency Ltd., “JCR”)

oriented society and reductions in greenhouse gas emissions
targeting a carbon-free society. To this end, Hulic conducts
afforestation training so that employees experience the forest
lifecycle. This activity provides opportunities to think about
environmental protection and communicate across the entire
Company.

External Evaluation(In FY2021, afforestation training was cancelled due to COVID-19.)

10 years

Data

Training for newly hired recently graduated employees upon

Corporate GovernanceSatoyama Conservation Activities: rice harvesting experience, trimming of shrubs and weeds

Social Initiatives

Post-Issuance Verification Report (Japanese, issued in August 2022)
https://www.hulic.co.jp/sustainability/ecology/management/pdf/
report_202208.pdf

24

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25

1. Achieving the RE100 Goal

Since 2018, Hulic has been developing fire-resistant wooden

to maintain a certain number of young, CO₂ absorbing trees by

Having launched the solar power generation business in 2012,

to entirely cover its power usage by this self-supply initiative,

buildings using timber that requires less energy for manufacturing

planting new trees after cutting down old trees to use as building

Hulic started developing photovoltaic equipment that does not

ensuring it achieves the goal set out for RE100 companies. Underand processing, in response to Japan Forestry Agency’s effort tomaterials. This initiative for fire-resistant wooden buildings helps

apply the feed-in tariff (FIT) system in 2020. Hulic had been aiming

this initiative, Hulic expects to be able to use renewable energy at

expand use of wood under a series of initiatives to reduce overallpromote forest circulation, which in turn leads to reduction in CO₂.

to achieve 100% renewable energy (the goal of RE100) by 2025 bya price equivalent to that of electricity generated by fossil fuels.

CO₂ emissions. Trees absorb CO₂ in the air and provide a carbon

Hulic is developing Japan’s first 12-story, fire-resistant wooden

developing solar power generation system that covers the power

Success in achieving the RE100 goal through the development ofdioxide fixing solution as they grow, so an abundance of trees incommercial facility (hybrid construction combining mainly domestic

consumption of the Group, including its subsidiaries, but now wethe non-FIT solar power generation will contribute extensively tothe nation’s land can help cut down CO₂ levels. Considering trees

wooden and steel structures) in Ginza, one of its focus areas.

are aiming to achieve it ahead of schedule by 2024. The electricity

Hulic’s greenhouse gas reduction plan as well as ensure that Hulic

are losing ability to absorb CO₂ as they get older, it is possible

Construction was completed in October 2021.

generated by the solar equipment will be supplied to each building

is taking a step forward to realize a sustainable society (carbon-freethrough Hulic Property Solution Co., Ltd., a Group company, which

and material-recycling society) under its long-term vision for theacts as a power supplier. This will make Hulic Japan’s first company

environment.

Progress against the target
As of August 2022
Completed in October 2021

Progress against the target

List of solar photovoltaic equipment developed by the Company
Location

April 2022

A t a m i m a c h i 2 , K o r i y a m a C i t y, F u k u s h i m a
Prefecture

April 2022

No, Gyoda City, Saitama Prefecture

April 2022

Mibukou, Mibumachi, Shimotsuga District, Tochigi
Prefecture

April 2022

Kaiharatsukamachi, Ryugasaki City, Ibaraki
Prefecture

January 2021 Omiya Town 1, Wakaba Ward, Chiba Prefecture
February 2021 Meishizawa, Tamura City, Fukushima Prefecture
March 2021

Gotomaki, Tamura City, Fukushima Prefecture

April 2021

Kikutamachi, Koriyama City, Fukushima Prefecture

May 2021

Kazo City 2, Saitama Prefecture

May 2021

Kakeuma,Amimachi, Inashiki District, Ibaraki
Prefecture

May 2022

Ozatomutsuai Town, Tsu City, Mie Prefecture

May 2022

Taki Town, Taki District, Mie Prefecture

September
2021

Hiwadamachi, Koriyama City, Fukushima
Prefecture

May 2022

Kizawa, Oyama City, Tochigi Prefecture

May 2022

Kazo City 4, Saitama Prefecture

May 2022

Fujimimachi, Suwa District, Nagano Prefecture

May 2022

Higashinoda, Oyama City, Tochigi Prefecture

October 2021 Mihotamachi, Koriyama City, Fukushima Prefecture
November
2021

Atamimachi 1, Koriyama City, Fukushima
Prefecture

November
2021

May 2022

Shimoishibashi, Shimotsuke City, Tochigi Prefecture

Wakakodama, Gyoda City, Saitama Prefecture

May 2022

Koganei, Shimotsuke City, Tochigi Prefecture

December
2021

Omiya Town 2, Wakaba Ward, Chiba Prefecture

May 2022

December
2021

Koumimachi, Minamisaku District, Nagano
Prefecture

May 2022

December
2021

Matate, Bandou City, Ibaraki Prefecture

May 2022

December
2021

Kazo City 3, Saitama Prefecture

December
2021

Oppara,Amimachi, Inashiki District, Ibaraki
Prefecture

Forest Circulation

Social Initiatives

October 2020 Kazo City 1, Saitama Prefecture

Completion

Corporate Governance

Location

Kaminokawamachi, Kawachi District, Tochigi
Prefecture
Fujii 1, Mibumachi, Shimotsuga District, Tochigi
Prefecture
Fujii 2, Mibumachi, Shimotsuga District, Tochigi

Data

Completion

Environmental Initiatives

2. Completion of Japan's first 12-story fire-resistant wooden commercial facility in the Ginza 8-chome
Development Plan

SPTs&Progress against targets

Our Approach to Sustainability

Environmental Initiatives

Prefecture

External Evaluation

Total power generation capacity of solar photovoltaic equipment completed in FY2021:17.6MW

Solar power generation results and RE100 rate of progress
Solar power generation results(as of the end of December 2021)

RE100 rate of progress(as of the end of December 2021)*

8,077MWh

20.6％*R E100 rate of progress is reported to CDP, and the calculation method is as follows.
the amount of power generated by Hulic-owned solar photovoltaic equipment for one year ÷ the total amount of electricity used at the Hulic head office building and on the floors
occupied by Group companies in one year26

Hulic Co., Ltd. Sustainability Book 2022

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27

Environmental Initiatives

Ginza 8-chome Development Plan (HULIC &New GINZA 8) (fire-resistant commercial building)

Location

Structure
No. of floors

Commercial facility
Ginza 8-chome(four-minute walk from
Shinbashi Station)
Hybrid construction combining wooden andsteel structure

Greenhouse Gas Emissions Reduction Targets
In November 2021, Hulic formulated new greenhouse gas emissions reduction targets.

12 floors above ground, 1 below

Site area

252.48m2

Total floor area

2,459.55m2

GHG Emissions Reduction Targets (Absolute contraction targets, Base Year: 2019)]

Design and construction

Takenaka Corporation

Exterior design supervisor

Kengo Kuma and Associates

Completion

Targeting to realize a carbon-free society which is envisioned in Hulic’s Long-term Ðision for theEnvironment, we act to combat climate change by pursuing initiatives Ðncluding achieving 100%
renewable energy by 2030 at all Company-owned properties and achieving RE100 by 2024.

Fundamental
Approach

October 2021

1

Scope 1 and 2*
Scope 3*

2

2024

2030

2050

Reduced by 70％

Reduced by 70％

Sustaintially zeron.a.

Reduced by 30％

Sustaintially zero

*1 Emissions from energy consumptions by the reporting company.
Scope 1: emissions from operations that are owned or controlled by the reporting company.
Scope 2: emissions from the generation of purchased or acquired electricity, steam, heating, or cooling consumed by the reporting company.
*2 G reenhouse gas emissions from external companies affiliated with internal business activities (in the supply chain). Targets were set for Categories 11 and 13, which cover approximately
80% of Scope3.

Social Initiatives

Hulic has had its near-term (by 2030) emissions reduction

Environmental Initiatives

Asset type

Our Approach to Sustainability

Initiatives for Climate Changetargets approved by the Science Based Target initiative*3(SBTi)as consistent with levels required to meet the goals of the Paris
Agreement. The targets covering greenhouse gas emissions fromthe Company’s operations are consistent with reductions required
to keep the global warming to 1.5℃, the most ambitious goal of
the Paris Agreement. In addition, the Company’s target for the

The list of investors that have committed to investing in the Bonds
is included in the press release.

WEB

Press release (English)
https://www.hulic.co.jp/en/sustainability/ecology/management/pdf/
release_en_20201009.pdf

Received the silver prize in the second ESG Finance Award Japanfor ambitious value chain goals, meaning they are in line withcurrent best practice.
*3: Science Based Targets initiative (SBTi)
A collaboration between CDP, the United Nations Global Compact, World Resources Institute (WRI) and the World Wide Fund for Nature (WWF), and is an international initiative that
promote private sector to develop GHG emissions reduction targets in line with Paris Agreement (long-term temperature goal is to keep the rise in mean global temperature to well
below 2°C and limiting below 1.5˚C above pre-industrial levels), then validate and approve targets submitted to them. For approval, GHG emissions need to comply with GHG Protocol
accounting and reporting standards, and near-term reduction targets need to be set between 5 and 15 years from the date of target submission to SBTi.

In February 2021, we received the silver prize as well as the Minister of the Environment award in the issuer category of the second ESG
WEB

Long-term Vision for the Environment
https://www.hulic.co.jp/en/sustainability/ecology/management/vision.html

External Evaluation

Data

Finance Award Japan hosted by the Ministry of the Environment for this bond issuance.

Corporate Governance

List of investors that have committed to investing in the Bonds

emissions from its value chain (Scope 3) meets the SBTi’s criteria

28

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29

2019

 ownstream Scope 3 emissions: implementing measures to
•D

2020

2021

plants that will generate 310 GWh of electricity which isincrease energy efficiency of properties including introduction

Scope1 Direct Emissions

14,931

10,49011,369equivalent of estimated annual electricity consumption at allof environmentally friendly technologies, energy conservation

Scope2 Indirect Emissions(Market based)

25,067

18,52917,473Company-owned properties*2 in 2030. The renewable energy-

renovations, use of unused energies, improvement of energy

Subtotal Scope 1 and Scope 2

39,99729,01928,842

based electricity generated will be supplied to all Company-

efficiency by reconstruction, and making efforts to pursue

owned properties.

reduction of total energy consumption of leasing properties in

1 Purshased goods and services

18,30324,72324,497

2 Capital goods

20,73039,142

19,638

3 Fuel and energy related activities

6,597

5,132

5,238

—

—

—

3

● Aim to achieve RE100*

by 2024 by using 100% renewablesources for the energy required for Hulic Group's businessactivities.
● Invest in developing small hydroelectric plants in addition to non-FIT solar power plants in order to secure resilience of renewableenergy sources*4.
● Implementing value chain (Scope 3) engagements:• Upstream Scope 3 emissions: consider reduction of GHG
emissions related to construction including switchingcooperation with tenants.
*1:non-FIT
Does not use a feed-in tariff (FIT) system for electricity that requires utility companies
to purchase electricity generated using renewable sources for a certain period of time
at a price specified by the national government.
*2:All Company-owned properties
Excludes single-tenant lease properties, residential properties and unmanaged sharedproperties for which the Company does not manage energy, and real estate for sale.
*3:RE100 (Renewable Electricity 100%)
An international initiative in which member companies aim to use 100% renewablesources for the energy required for their business activities.
*4:Secure resilience of renewable energy sources
Supply electricity stably by using multiple energy sources.

electricity used at construction sites to renewable energy,
promoting wooden construction and conversion initiatives,WEB

etc. in cooperation with architectural design companies andcontractors.

Effective Use of Renewable Energy
https://www.hulic.co.jp/en/sustainability/ecology/warming/energy.html
Initiatives for Energy Conservation
https://www.hulic.co.jp/en/sustainability/ecology/warming/efficiency.html
Effective Use of Unused Energies
https://www.hulic.co.jp/en/sustainability/ecology/warming/unused.html

Status of Greenhouse Gas Emissions
Greenhouse Gas Emissions and Total Energy Consumption
Greenhouse Gas Emissions and Total Energy Consumption are shown below.

Scope 34 Transportation and delivery (upstream)

2,276

2,296

1,419

6 Business travel

5 Waste generated in operations

244

251

194

7 Employee commuting

455

430

283

8 Upstream leased assets

—

—

—

9 Downstream transportation and distribution

—

—

—

10 Processing of sold products

—

—

—

36,98488,28043,315

193

484

1,005

143,225

109,328

115,114

14 Franchises

—

—

—

15 Investments

—

—

—

Subtotal Scope 3

229,006

270,066

210,703

Total Scope 1, 2 and 3

269,004

299,085

239,545

11 Use of sold products
12 End-of-life treatment of sold products
13 Downstream leased assets—: Not applicable.
Note: Figures marked with “ ” have been assured by an independent assurance provider.
Hulic manages the amount of permissible leaks as an administrator based on the Act on Rational Use and Proper Management of Fluorocarbons and they are included in the calculations ofgreenhouse gas emissions. Note that we do not report or disclose this data as the amount of leaks is below the reporting standards.

Calculations of Greenhouse Gas Scope 3 Emissions
https://www.hulic.co.jp/en/sustainability/ecology/warming/pdf/CalculationsofGreen
houseGasScope3Emissions.pdf

Total Energy Consumption
2019

2020

2021

Scope1

262,247,523

204,332,023

212,257,609

Scope2507,869,906

395,386,960

391,691,676

Total

770,117,429

599,718,983

603,949,285

Note: Figures marked with“”have been assured by an independent assurance provider.

Green Procurement Initiatives
Hulic is working to reduce environmental impacts throughout all of our operations, and we ask our business partners, including suppliers, tocooperate with the following green procurement policy:
External Evaluation

Note:Figures marked with “ ” have been assured by an independent assurance provider.
*1 The greenhouse gas emissions are calculated based on the GHG Protocol. The boundary for Scope1 and 2 is the properties where the Hulic Group has control of energy management(30 properties in FY2019, 36 properties in FY2020, and 41 properties in FY2021). The unit calorific values and the emission factors are based on values in the Act on the Rational Use ofEnergy and the Act on Promotion of Global Warming Countermeasures. Until FY2020, greenhouse gas emissions from one hotel operated by a subsidiary were calculated based on ourownership ratio in that property, but starting in FY2021, emissions are calculated based on operational control. As a result, energy consumption and greenhouse gas emissions increasedby 55TJ and approximately 2,600 t-CO2e, respectively, compared with calculations based on the ownership ratio.
*2 Thousand metric tons

(MJ)

Data

WEB

Environmental Initiatives

solar powerSocial Initiatives

1● Invest JPY66 billion in developing new non-FIT*(t-CO2e)Corporate GovernanceGreenhouse Gas Emissions

Hulic’s Actions for Achieving the Targets

Our Approach to Sustainability

Environmental Initiatives

1. To engage in energy-saving activities and reduce GHG emissions;
2. To reduce the amount of water consumption as much as possible;
3. To carry out a biodiversity-friendly business;
4. To fully prevent environmental pollution; and5. To make efforts to save resources and reduce the amount of waste.

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Initiatives for Environmentally Friendly Technologies
Introducing CO2 Reduction Technologies at the Hulic Head Office Building
Photovoltaic power generation panels are installed on the rooftop,

is adjusted with daylight detecting sensors. To improve heatand rainwater is used for flush toilets. LED lighting systems are

insulation performance of exterior walls, Low-E pair glasses andadopted in the entire building including office rooms. Brightness

wood blinds are used.

Natural Lighting System

Our Approach to Sustainability

Environmental Initiatives

Image of natural lighting

Our natural lighting system uses speciallyshaped natural lighting anidolic louvers codeveloped with MIT to capture constantly
changing sunlight on the ceiling of rooms
during changing seasons and times (elevationand orientation) without the use of power.
Highly reflective metal panels are used forEnvironmental Initiatives

interior ceilings, which supply a consistentamount of pleasant natural light to the topof office desks. This system has been installedat the Hulic Head Office Building as well as atthe Hulic Shinjuku Building, Hulic Annex, andother buildings.

Calculations at the Hulic Head Office Building
CO2 can be effectively reduced by introducing such top-level environmental technologies. In CASBEE (Comprehensive Assessment System for
Built Environment Efficiency), BEE scored 3.3, corresponding to rank S.

ERR(*)

CO2
emissions
reduction

Hulic Head Office building introduced an uniquenatural ventilation system, jointly researched andCross-Sectional View of Natural Ventilation

Data

Natural Ventilation System* PAL=An assessment indicator for the energy efficiency of building plans andenvelope (exterior walls and roof, etc.)* E RR= Shows the percentage by which primary energy consumption has been
reduced in facilities and systems

Commercialization of Environmental Technologies

developed with MIT in which air flows and other

Natural Lighting System (patent awarded)factors in the office area were meticulously

The natural lighting system was developed as a result of a three-[Summary of patent]

simulated. This system automatically take inyear research/development project that Hulic engaged in with theName of invention: Lighting louver unit

cooler air from outside during seasonable

Massachusetts Institute of Technology. With a specially designed

Registration No.: 6021103

intervals so that favorable conditions of officenatural lighting louver(anidolic louvers), it can take in a certain

Registration date: October 14, 2016

can be maintained even if the air conditioning

amount of sunlight to the ceiling surface of a room without

is shut. In addition, annual energy consumption

using electricity in accordance with different seasons and timesof the Head Office building is reduced by theof day. The greatest features of this system are that it realizes a

introduction of this system. Furthermore, in

comfortable level of illuminance with natural light, which wasorder to realize the use of a natural ventilation

previously unattainable, and also that it has a simple, maintenance-system in a dense urban area, a silencer chamber

free structure even though it comes with a fixed type.

External Evaluation

Natural Ventilation and Natural Lighting System Developed through Joint Research with the
Massachusetts Institute of Technology (MIT)=225 MJ/year ㎡ … Standard value of officebuildings minus 25%=35% … The highest class in the energysaving performance standard of Tokyo
metropolitan government=40% reduction compared to an average
office building in the Tokyo Metropolitan
Government's energy efficiency
performance standards.
=CO2 emissions throughout the building's
entire life cycle were reduced by 30％

Corporate Governance

PAL(*)

Social Initiatives

Effects of CO2 Reduction

is attached in the intake opening to minimize
outside noise affecting inside work space.

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Photovoltaic Panels (patent awarded)

Our Approach to Sustainability

Environmental Initiatives

Introduction of LED Lighting System

The special feature of Hulic’s photovoltaic panels co-developedwith Taiyo Kogyo Corporation and Gifu Plastic Industry Co., Ltd.

Hulic has realized a lighting conditions

is that they are lightweight, freely designable, and easy to install.

preferable for customer work style as well as

We realized a lightweight photovoltaic panel with high strengtha significant level of CO2 emissions reduction

by using aluminum board and plastic-based honeycomb-panel

through energy saving by adjusting the levelmaterial. Its weight is about half that of a conventional solar panel.

of LED lighting automatically with daylight and

The panel can be freely designed through customization and canmotion sensors.

be made in various shapes. Equipped with a sliding mechanism
Environmental Initiatives

using a special metal fitting, it can be relatively easily installed.
Thus, it can be installed even in a building with strict loading
conditions such as in repairing works.
[Summary of patent]
Name of invention: Photovoltaic generation system and assembly

Photovoltaic panels (patent awarded)

methodRegistration No.: 6018856
Registration date: October 7, 2016

As a part of environmental business, Hulic jointly has developed

Introducing Low Energy Consumption Facilities to Nursing Homes

with TOHO LEO CO., Ltd. and Daito Techno Green CO., Ltd. a wall

We have an environmentally friendly plan for aiming to help

greening system (thin-layer wall greening system) that can be easily

realize a sustainable society including but not limited to LED

installed in existing buildings. We completed development of thelighting, highly efficient water heater, equipping with photovoltaic

product and obtained a joint patent for it with three companies.

panels on their rooftops to provide electric power to the common

Social Initiatives

Commercialization of Thin-layer Wall Greening System (patent awarded)materials, adopting roof greening, keeping natural lighting, natural

Name of invention: Greening device and its method

drafting by a natural ventilation system and installing panel heating

Registration No.: 6460942

and cooling system, to name a few.

Registration date: January 11, 2019

Commercialization of thin-layer wall greening system

Initiatives for Energy Conservation

Atrium which installed natural ventilation
system(Hospitalment Musashino)

Photovoltaic panels on the rooftop(Sonare Meguro Fudomae)

Use of Systems that Make it Easier for Tenants to Conserve Energy
The Hulic Group has begun rolling out a visualization system that

Corporate Governanceareas and others. Additionally, we are keen on using of wood in[Summary of patent]

freely controls air conditioning use in order to provide a better

Introduction of LED Lighting
Use of LED lighting, which is brighter than incandescent lamps andand effectively use resources. In princple, all Hulic’s development

tenants to set the optimal working environment temperature

fluorescents and uses less electricity, helps to significantly reduce

projects use LED lighting. We are also sequentially switching overfor their business and makes it easier to implement energy

power consumption and CO2 emissions. Furthermore, as LED

to high-efficiency lighting and LED lighting at our existing buildings

conservation measures.

lighting is long lasting, it is possible to not only save the trouble

as part of energy efficiency renovation work.

Data

understanding of a building's use of energy. This system enablesof maintenance such as changing bulbs, but also reduce waste

External Evaluation

Visualization system (Hulic Asakusabashi Building)Space with LED lighting system (Hulic Ginza Sukiyabashi Building)34

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35

Received New Energy Foundation Chairman’s Award at the Fiscal Year 2021 New Energy Awards
on renewable energy systems at three investments or more in eachequipment through proprietary development and ownership, as

year. Results in FY2021 were eight.

an alternative main power source for reducing greenhouse gas
emissions.
Additionally, we are installing various renewable energy systems at
our properties, and have set a non-financial target for the numberof capital investments in development and reconstruction projects

WEB

Long-term Vision for the Environment
https://www.hulic.co.jp/en/sustainability/ecology/management/vision.
html
Greenhouse Gas Emissions Targets
https://www.hulic.co.jp/en/sustainability/ecology/warming/roadmap.html

Converting to a 100% Renewable Energy Sourced Electricity for Electricity Consumption at All
Company-owned Buildings
In accordance with Hulic's Long-term Vision for the Environment,

the total amount of renewable energy. We aim to use electricity

we established the climate change goals of achieving RE100*1

derived from renewable energy sources at all Company-owned

by 2024 and converting to a 100% renewable energy sourced

properties, supplied from our solar photovoltaic equipment thatelectricity for electricity consumption at all Company-owned

do not use the FIT system. In addition, we have established abuildings*2 by 2030.

corporate PPA*4 mechanism whereby Hulic Property Solutions, a

To achieve these goals, we plan to invest JPY66 billion in newly

Group company, acts as a retail electricity supplier (power producer

developing non-FIT*3 solar power plants. What makes Hulic's

and supplier, or PPS), purchasing electricity derived from Company-

approach unique is that we aim to achieve the targets throughowned renewable energy sources and selling it to Company-owned

emphasizing “additionality” perspective of renewable energy soproperties. This will ensure stable sourcing of renewable energy-

that we plan to develop and own proprietary renewable energy

derived electricity over the long term.

In recognition of our efforts in achieving RE100 by 2024 andconverting to a 100% renewable energy for electric consumption
at all Company-owned buildings* by 2030, which we arepromoting to realize a decarbonized society, we received the
New Energy Foundation Chairman's Award at the 2021 New
Energy Awards, along with Hulic Property Solutions Co., Ltd. and
ADVANCE CO., LTD.
The New Energy Awards, organized by the New Energy Foundationand supported by Japan’s Ministry of Economy, Trade and Industry,

looks widely for the application of
products related to new energy as
well as activities to adopt and raiseawareness of new energy. The
goals are to further promote theadoption, spread, and awarenessof new energy, along with therecognition for our outstandingachievement.

Evaluated points
In this initiative, Hulic develops and owns non-FIT solar power
generation and small hydropower generation with Advance as adevelopment partner, and promotes renewable energy. As a retailelectric supplier, Hulic Property Solutions is building a "corporate
PPA mechanism" that purchases all of the electricity generated andsupplies it to Hulic's buildings*. At the New Energy Foundation
Chairman's Award, we received high praise for the "additionality"of new development of renewable energy, the uniqueness ofcorporate PPA mechanism, and the advancedness of making ourown buildings into ZEB (zero energy building).

* E xcludes properties for which we do not have energy management authority including master lease properties, residential properties and non-managerial coownershipproperties, and reals estate for sale.

Social Initiatives

Hulic promotes the use of renewable energy power generation

Small Hydroelectric Plants

equipment that do not use the FIT system (non-FIT) to increase

As solar power does not generate electricity at night and thedeveloping energy resilience (a stable power supply from varied*1 RE100: An abbreviation of Renewable Electricity 100% and is aninternational initiative in which member companies aim to use 100%
renewable sources for the energy required for their business activities.
*2 A
 ll Company-owned buildings: Excludes properties for which we
do not have energy management authority including master leaseproperties, residential properties and non-managerial coownershipproperties, and reals estate for sale.
*3 F eed-in tariff (FIT): A system for electricity that requires utility
companies to purchase electricity generated using renewable sources
for a certain period of time at a price specified by the national
government.
*4 C orporate power purchase agreement (PPA): An agreement inwhich corporations, municipalities and other legal entities purchaserenewable electricity from power providers on a long-term basis.

amount of power generated fluctuates depending on the weather,power sources).

we are developing and operating our own small hydroelectric

Note that small hydroelectric plants will not be used as renewable

plants*1 that can generate electricity both day and night regardless

power sources as at 2030 since they use the FIT system.

of the weather from long-term perspective with the goal of

Mechanism Facilitating Stable Energy Supplies Utilizing Multiple Power Sources (image)

Solar photovoltaic equipment that do not use the FIT system

Corporate GovernanceInitiatives for Utilizing Renewable Energy

Environmental Initiatives

TOPICS

Effective Use of Renewable Energy

Our Approach to Sustainability

Environmental Initiatives

Fully Internal Group Corporate PPA Model● Long-term stable supply of renewable energy
from Hulic-owned power sources● Secured profitability in power generation andlow-cost supply of renewable electricity
Data

Hulic-owned buildings

Advance, Co., Ltd.
Developer

100% ofrenewableenergy purchased

Retail electricity supplier

Hulic Property Solution Co., Ltd.

Renewable energy certificates
Non-FIT solar + post-FIT small hydroelectricNon-fossil fuel market

Renewableenergy supply

100% renewableenergyUnique traits of Hulic's renewable energy sources
・New development and 100% in-house ownership of renewable energy facilities ▶ New development contributes to reductions in CO2 emissions ("additionality")
・Non-FIT solar photovoltaic equipment ▶ No market purchase of renewable energy certificates36

Hulic Co., Ltd. Sustainability Book 2022

In May 2021, Hulic’s first small hydroelectric was completed andto operate at higher operating rates than conventional small

began operations in Kawabamura, Tone-gun, Gunma Prefecture.

hydroelectric power plants.

Mindful of the location and conditions, a range of autonomous,

From the perspective of the energy mix, Hulic plans to continue

electrification, and remote technologies were introduced. Thesedeveloping and using small hydroelectric power generators.

External Evaluation

Owner of power
generation facilities

initiatives have resulted in a state-of-the-art power plant expected*1 Small-scale hydroelectric power generation with an output of 1,000 kW or less. As it generates electricity stably day and night, it is considered to be a stable power supply with relatively
high operating rates among renewable energy facilities.
Note that small hydroelectric plans will not be used as renewable power sources as at 2030 since they use the FIT system. We plan to supply renewable energy to its properties after the
FIT period has ended (20 years hence).

Hulic Co., Ltd. Sustainability Book 2022

37

Kawabadani small hydroelectric plant overview
・Water source: Usune River in Kawabamura, Gunma Prefecture

Our Approach to Sustainability

Environmental Initiatives

Installing Solar Photovoltaic Panels on the Rooftop for Onsite Consumption

・Overall length: 1.65 km

We have been making effort to reduce CO2 emissions by installing・Height difference: Approximately 120m

photovoltaic cell modules on the rooftop of buildings and use

・Power generation scale: 199kW

solar power as a supplemental energy source. A solar photovoltaic

・A nnual power generation: Approximately 1.3GWh (equivalent toarray was installed on the roof at Hulic Logistics Kasai, a logistics

360 households in terms of annual power consumed by ordinary

center completed in May 2022. The renewable energy (electricity)

households)

generated is being used onsite.

・Hulic plans to supply electricity to its properties after the FIT period
Environmental Initiatives

has ended (20 years hence)
Kawabadani small hydroelectric plant water intake

Small Hydroelectric Plant Construction (Image)

Hulic Logistics Kasai(power generation capacity 0.6MW)

Installation of Solar Heat Panels
Hulic's hotels, multi-unit apartments and buildings that requirelarge amounts of hot water adopt a solar water heating system,

Social Initiatives

which uses solar panels to collect the sun's heat. Hot water createdusing this system is supplied to residential units, dormitories andkitchens, among other facilities inside a building.
At HULIC SQUARE TOKYO, the solar heat collection panels arelocated on the rooftop as a supplemental heating source for hot
water system of THE GATE HOTEL TOKYO by HULIC and has been

Corporate Governancecontributing in decreasing CO2 emissions.

Solar heat collection panels (HULIC SQUARE TOKYO)

Installation of Photovoltaic Panels on an Exterior Wall
The Hulic Ogikubo Building is open to a major arterial road on
its south side, providing ideal conditions for sunlight exposure.
Capitalizing on this, we used a unique and ex tremely thinphotovoltaic panel that is sandwiched between glass panes to createa building material for the facade (front of the building). The panels
electricity annually.

The exterior wall with photovoltaic panels (Hulic Ogikubo Building)38

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External Evaluation

Data

form part of a 4.8 kW system capable of generating 2,600 kWh of

39

Environmental Initiatives

Realization of a Recycling-oriented Society

Effective Use of Unused Energies
Unused energies are generic term of energies that have not beenwater. As a way to efficiently utilize energy for the reduction ofused in the past despite the fact that they could be used effectively

environmental load, we are working on the advanced utilization

which include heat disposed from buildings and factories, andof unused energy according to location conditions, asset type, anddifference in temperature of river water, ground water, or sewage

the characteristics of development projects.

Fundamental
ApproachCase Study1
Use of exhaust heat of hot springs at FUFU Kawaguchiko
At FUFU Kawaguchiko, our ryokan (a Japanese style luxuryinn), the exhaust heat of flowing hot spring water which had
been disposed in the past is collected by highly efficient heatpump and introduced as a hot spring exhaust heat utilization
system which is used as a supplemental heating source for thewater heater of ryokan. The effect of introducing this system
resulted in an approximately 30% decline in water heatingenergy consumption. The system received subsidy from the
Ministry of Economy, Trade and Industry as the FY2017 andFY2018 subsidy on business that promote local production for
local consumption by making use of local features.

We formulated our Long-term Vision for the Environment which states that we executeenvironmentally friendly management to realize an ideal society of carbon-free and recyclingoriented society in 2050. As a real estate developer, we believe that Hulic can offer value tosociety by putting our environmental effort into reducing greenhouse gas emissions, using
resources efficiently, and reducing waste.
We are actively working to reduce waste disposal and water consumption in cooperation
with our customers (tenants) and business partners for realization of recycling society. Whendeveloping and reconstructing buildings, we endeavor to reduce environmental impacts bypromoting the 3R (reduce, reuse, and recycle) through the adoption of Longer Life Building
designs that enable to reduce waste significantly and use resources effectively.

《Results in FY2021》 P ercentage of technical measures (such as longer life design, etc.)* applied to reduce constructionwaste: 100% each year
* The percentage of properties completed in the given year that used technologies and measures that contributed to a reduction in waste as well as raw materials and other resources
based on the Hulic Guidelines for Longer Life.

Roadmap of Long-term Vision for the Environment
https://www.hulic.co.jp/en/sustainability/ecology/management/vision.html#anc3

Social Initiatives

WEB

Longer Life Buildings

Exterior of FUFU KawaguchikoStandardization of 100 Year Buildings

Case Study 2

Environmental Initiatives

Effective Use of Unused Energies

Our Approach to Sustainability

Building a Recycling-oriented Society

The Company formulated the Hulic Guidelines for Longer Lifein all development and reconstruction completed or under

Building (the Guidelines) in 2011 to standardize specifications

development since formulating the Guidelines in 2011.

for development and reconstruction projects. The Guidelines

facility by extracting heat from or releasing heat to the riverwater, within a range that does not affect the environment, as
the temperature of the river water is cooler than the outside
air in summer and warmer in winter. Compared with air-source
heat pumps that transfer heat absorbed from the outside
air to an indoor space, such as household air conditioners,
this enables facilities to be air conditioned with less energy
consumption. It is estimated that this project will reduce theannual energy consumption for air conditioning in the target
area by approximately 12%.

Corporate GovernanceIn the HULIC RYOGOKU RIVER CENTER (a PPP project),which was completed in 2020, we focused on the Sumida
River adjacent to the site of the property and installed an airconditioning system that utilizes energy from the differencein temperature with the river water. Praised for its advanced
nature, the project was selected by Cool Net Tokyo (Tokyo
Metropolitan Center for Climate Change Actions) as a “projectto expand the introduction of renewable energy on a local
production for local consumption basis.” The River Water
Temperature Difference Energy Utilization Equipment uses a
purpose-built heat pump to provide air conditioning in theare composed of three ideas, 1) high earthquake resistance andhigh durability; 2) smoother updating and renewal; and 3) highserviceability. We use only high-grade building frames that ensure
the buildings are durable and used safely for over 100 years aswell as make it possible to modify layout or change of intended
use to fit with diversifying work styles in the future and reformbuilding exteriors. Furthermore, longer life buildings reduce waste
generation and resources used for reconstruction by 50% or more,
and reduce life cycle CO2 by 6% compared to the cases wherebuildings are conventionally reconstructed every 40 years (standard
plans).
We have introduced longer life designs as standard specifications

Data

An air-conditioning system that utilizes energy from the difference in temperature with the river water inthe HULIC RYOGOKU RIVER CENTER

Environmental Advantages of Longer Life Buildings

External Evaluation

Air conditioning system making use of river water (image)Riverwater utilization heat pump40

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Wooden Construction and Conversion Initiatives
We have been developing fireproof wooden buildings using timber

down CO2 levels.

1 High earthquake-resistance and high durability

that requires less energy for manufacturing and processing with

Furthermore, trees that are ready to be cut for timber have a

Structural frames shall be strong and solid so they can be safely used over 100 years.

lower CO2 emissions since 2018 to realize a sustainable society in

reduced ability to absorb CO2, so while we cut down trees as● We apply our internal earthquake-resistance standards where building performance can safeguard human life and enable continued use of

response to the Forestry Agency's promotion of expanded use ofbuilding materials, we also plant new trees to replace them. In thisthe building with post-earthquake repair in the event of an earthquake with a seismic intensity of 7 level to all asset types of properties wewood in a series of initiatives to reduce overall CO2 emissions.

way, we are contributing in maintaining the proportion of young

develop or construct

We also engage in activities to cut, plant, and remove undergrowthtrees that absorb CO2 well at a certain level. Through this initiativeby the same amount as the standing timber used as the source offor fireproof wooden buildings, we are promoting forest circulation● Thoroughly control the quality of works by designating details of design conditions for concrete and construction materials

building materials for our fireproof wooden buildings. Trees absorb

by using, planting, growing, and cutting down trees, which in turn2 Smoother updating and renewal

CO2 in the air and provide a carbon dioxide fixing solution as they

reduces CO2 emissions and leads to efforts to conserve biodiversity.

We adopt a design capable of responding flexibly to future needs, and establish plans of updating and renewal without the need to makegrow, so an abundance of trees in the nation’s land can help cut

tenants move out.
● Flexibly respond to future changes in use purposes and layout, with spare ceiling height room and floor loading capacity, as well as aflexible partition wall and a system ceiling.
● Ensure the space to install spare pipes and equipment, etc. so as to continue business even during the period of works for updating andrenewal.

Environmental Initiatives

Hulic Guidelines for Longer Life Building

Our Approach to Sustainability

Environmental Initiatives● In commercial buildings, adopt the interchangeable facade system capable to meet the needs of the time, in order to avoid the building

exterior to become obsolete, if the conditions are met.

Social Initiatives

3 Ease of maintenanceWe formulate plans enabling timely and meticulous maintenance in order to keep sophisticated building specifications and optimal building
functions constantly● Use gondola for maintenance, including inspections of the building exterior.
● Install an elevator reaching the rooftop to carry in materials there.

Responding to future changes in purpose of use and layout

2.8m or higher

Loading capacity: 500kg/m2 in general, 800kg/m2～1t/m2 in heavy duty zone
System ceiling:

A system ceiling responding to needs for smoother maintenance, updating of facilities,
and changeability of partitions between tenants.

POINT2
Replaceable facade systems
For commercial buildings, the exterior appearance is important. This is because a stylish appearance at the forefront of the age would
attract customers. Therefore, if site conditions and other factors are met, we adopt a system where the facade (front exterior of thebuilding) can be separated from the main structure, without any legal constraints,
to update the exterior design. Hulic Ginza Sukiyabashi Building located in Ginza,
a major commercial area in Japan, has adopted the characteristic facade design
expressing the scenery of a waterfront with willow trees. The two-tier facade withcasted aluminum in curved shape installed on the curtain wall is separate from themain body of the building.
As for office buildings, we intend to adopt a simple and calm design with an
exterior appearance that can become harmonious with the surrounding landscapeas time passes.

42

Hulic Co., Ltd. Sustainability Book 2022

To Spread

Organized Wooden Architecture Symposium 2019
We held the Wooden Architecture Symposium 2019 with the aim of raising awareness on the possibilities of woodenbuildings and to increase demand for timber in urban areas.
Participate in the Wood Change Council
We are a member of the Wood Change Council, a networking gathering sponsored by the Forestry Agency which aims
to promote the use of timber in the private sector buildings.

To UseCompletion of HULIC &New GINZA 8
Construction of HULIC &New Ginza 8 was completed in October 2021, Japan’s first 12-story fireproof wooden (hybrid
construction combining wood and steel) commercial building.

To Plant

Execution of environmental afforestation
We execute planting trees in addition to use them in building construction so that we can promote circulation offorests.

Data

Ceiling height:

Basic Policy for Promoting Wooden Buildings

External Evaluation

From a viewpoint of a long-term use for 100 years, it can be expected that the use of building
will largely change, for example, from an office building to a store or from a store to arestaurant. By providing spare ceiling height room and floor loading capacity in advance, it ispossible to respond easily to future changes in use purposes and layout, as well as for renewal.

Corporate Governance

POINT1

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43

Example of Use 2: Promoting Conversion to Wood

We developed Japan’s first 12-story wooden fireproof commercial building (hybrid construction combining wooden and steel structures) in

Along with the development of fireproof wooden buildings, Hulic

Ginza, one of our focus areas, in October 2021.

is actively promoting the use of wood for exteriors and interiors
depending on the application and location of the developed

Development and Design Concept

property.

With the objectives of contributing to both the growth of the forest

structure combining wooden and steel frame construction takes

In Hulic JP Akasaka Building, based on the concept ofindustry and regional revitalization, Hulic used domestic timber foradvantage of several wood-related technologies, such as cross“a wellness space for working people,” we focused

the structure—mostly sugi (cedar) from Fukushima Prefecture—basedlaminated timber (CLT), and vibration-damping walls and pillars

on creating a better working environment for officeon the design concept of creating a “forest” in the middle of Ginza.

made from glued laminated wood. The project which also used

workers. The building uses plentiful natural materials

While building with steel and concrete was used in places, we replaced

wood for exteriors shows the future of cities and structures, withand wooden benches and wooden shelves arranged in

to wood in all sections of the structure where this was possible toGinza serving as the model. Inside the building, the fireproofeda spacious 3.8 meter-high entrance hall complete withcreate a building with a highly economic and coherent structure.

wooden pillars and beams, as well as the ceiling using CLT, area full wooden ceiling. Praised for our initiatives, weThis 12-story wooden building was created with columns andexposed effectively to carry the feeling of warmth that wood brings

received highest rank of “S” in CASBEE-Wellness Office*beams made from timber with a fireproof coating. The hybrid

to the interior which is also aesthetically pleasing.

certification (issued by Institute for Building Environment* Comprehensive Assessment System for Built Environment Efficiency (CASBEE) assesses
the specifications, performance, and initiatives of buildings that support the healthand comfort of building users, factors that contribute to intellectual productivity
improvement, and the performance of safety and security.

Entrance Hall
(Hulic JP Akasaka Building)Wooden louvers(Hulic Ryogoku River Center)

than 800 participated the event and deepened understanding onof raising awareness on the possibilities of wooden buildings,

possibilities and challenges of wooden buildings through listening

helping to reduce CO2 emissions and protecting forests. Moreto the key note speech and panel discussions.

height leasing buildings as of April 2022.

Environmental benefits

Key Note Speech・Promotes fixation of CO2
Reduces CO2 by increasing the amount of wood used, leading to forest
regeneration (forest health)Kengo KUMA

Approximately 300 m3 of wood was used in the construction of HULIC(Architect·Professor at The University of Tokyo)&New GINZA 8, with the amount of carbon stored in the lumber (CO2equivalent) totaling 207 t-CO2.** Calculated based on the Forestry Agency’s “Guidelines for calculating carbon stored inwood used in buildings” (October 1, 2019) (for all wooden parts)

From concrete to wood
Japan could be the front runner in the century of wood.
● A shift from concrete to wood has been observed as oppose to the 20th century which
was a time of concrete.
● Japan’s wood-related technologies are number one in the world.

Panel Discussions

・Reduces CO2 emissions from construction

Kengo KUMA
Shuzo SUMI

Eliminates CO2 emissions during structural material manufacturing process(eliminates CO2 that would have been emitted during iron manufacturing,(Senior Executive Advisor, Tokio Marine &Nichido Fire Insurance Co., Ltd.)iron processing, concrete manufacturing and other processes)
Lightweight superstructure (above-ground frame section) compared to steel structures and reinforced concrete structures simplifies thefoundation structure of the building.

TOPICS
HULIC &New GINZA 8 was recognized with the highest award (Minister of Land, Infrastructure, Transport andTourism Prize) in the 25th Wood Utilization Competition (sponsored by Japan Youth Lumbermen’s Association)[Comment from judges]

revitalization of the forest industry by exploring new uses for wood

The HULIC &New GINZA 8 project has been highly rated forand its expanded use.

tackling the challenge of using wood in high-rise buildings in

Many wooden buildings have been constructed in Japan in theurban areas. The use of timber from all over Japan for a high-10 years since the enactment of the Act for Promotion of Use ofrise structure in Ginza, one of the country’s premier commercial

Wood in Public Buildings etc. aimed at bolstering the use of wood.

districts, will likely contribute significantly to more use of timber in

Recently, we have seen the development of many new woodenbuildings in the future.

materials as well as technology and construction methods, while●W ooden buildings will improve global and human environmental issues

K. KUMA:
S. Sumi:- Wooden construction is the area that Japan can make the world to seek after.
- E ffective use of Japan’s ample forestry resources will be the key to regional(President and CEO, Nikken Sekkei Ltd.)
revitalization.
Masahiro MIYASHITA
T. Kamei:- Optimization of timber is the key in planning of high-story wooden buildings.
(Chairman of the Board, Takenaka Corporation)
M. Miyashita: - T echnological innovation of wood engineering will support high-story
Atsuko FUKUSHIMA
wooden construction.
(Journalist)		
 ood is the ideal future material of sustainable society.
A. Fukushima: - W
Tadao KAMEI・Facilitates simplified foundations

Aiming to increase demand for timber in urban areas● Increase in middle-to-high-story wooden buildings will promote community vitalization

Note:Occupation, affiliation, title, etc., when symposium was held.

Example of Spread 2: Participate in the Wood Change Council
The Wood Change Council (the Council) is a networking gatheringsponsored by the Forestry Agency which aims to promote the useof timber in the private sector buildings. The Council discusses
and considers matters related to spreading timber use including
identification of issues, direction of solutions and popularization,

the laws related to wooden structures have been relaxed. Moreand aims to create an environment that timber is more easily used

[Wood Utilization Competition]

wooden construction is expected. Given this background, theas well as to create a platform of spreading the use of timber

Started in 1997, this year marked the 25th occasion for thecompetition recognizes excellent works that broadly convey the

movement throughout Japan. We participate in the Council with

Wood Utilization Competition. The goal is to contribute to thebenefits of wood and contributes to more use of wood.

an intent to continuously promote the use of timber.

Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

・Reinvigorates forestry (regional revitalization)

Corporate Governance

We held the Wooden Architecture Symposium 2019 with the aim

Data

New technologies
・Japan’s first 12-story wooden fireproof commercial building. The highest

Social Initiatives

Example of Spread 1: Organized Wooden Architecture Symposium 2019

Special Features

44

and Energy Conservation).

Environmental Initiatives

Example of Use 1: HULIC &New GINZA 8 (fireproof commercial building)

Our Approach to Sustainability

Environmental Initiatives

Hulic Co., Ltd. Sustainability Book 2022

45

Example of Planting 1: Planting the Same Amount of Trees Used
construction) commercial building completed in October 2021. At

forestry cooperatives in an effort to plant the same amount of

the same time, approximately 12,000 cedar saplings were planted

trees as the standing trees used as building materials for fireproof(new plantings) across an area of about 4.3 hectares. Over the

wooden construction. Approximately 300m3 of lumber was used

next five years, we will continue cutting undergrowth so that thein the construction of HULIC &New GINZA 8, a 12 story fireproof

planted cedar saplings will grow healthy.

wooden (hybrid structure combining wooden and steel frame

Promotion of the 3R
Efforts to Reduce
Reduction of disposals from restaurants in our own brand hotels

Cedar sapling newly planted and a mountain (Fukushima Prefecture)

We have materialized environmental advantages by making efforts

with an eye to saving resources. At hotels we own and manage (Theto curb the amount of waste disposal and CO2 emissions during

Gate Hotel brand) are reducing the amount of garbage from theirdevelopment, for example, by adopting longer life designs which

restaurants by biologically processing raw garbage.

can be in service for 100 years or longer as standard specificationsWEB

Our Group-wide Initiatives

Reduction of plastic waste at head office building

We are proactively working to reduce waste and water consumption in cooperation withtenants and building management companies toward realization of recycling society.
For developing and reconstructing buildings, we endeavor to reduce environmental impacts
by promoting the 3R (reduce, reuse, and recycle) through the adoption of Longer Life Building
designs that enable to reduce waste significantly and use resources effectively.

In consideration of the seriousness of marine pollution caused bycontainers, straws, spoons and shopping bags. We are also actively

disposable plastic waste, the in-house canteen at the Hulic headencouraging employees to bring their own cups.

office building has stopped use of disposable plastic beverage

Efforts to Reuse
Recycling parts of underground building frames during reconstruction
In reconstruction works, we make various efforts for reducing

Resource-saving and Reduction of Waste in Buildings Owned by Hulic and Reconstruction of Buildings

Examples of buildings that have used recycled

wastes generated in demolition works including concrete debris.
For example, underground building frames of existing buildings are

Hulic Group has worked on reduction in the amount of waste

water and various water conservation systems in many of ourused as retaining walls for the new building with new undergrounddisposal and water consumption in cooperation with tenants andbuildings. Water saving toilets and wash basins are standardized.

building frames installed inside. We make sure that adequatebuilding management companies. We install toilets that reuse

After considering impacts on neighboring areas of property, we
introduced the PC method (described later) into the followingbuilding a material-recycling society.

projects:● Hulic Ginza Sukiyabashi Building● Hulic Head Office Building● Hulic Shinjuku Building

frames of existing buildings are recycled.
We are constantly making efforts at buildings which our group company head offices occupy including hotels to reduce waste in order forunderground frames● Ochanomizu Sola City

inspections are conducted to confirm the strength when building

Amount of Waste Disposal at Hulic Group

Corporate GovernanceFundamental
Approach

Longer Life Buildings
https://www.hulic.co.jp/en/sustainability/ecology/waste/initiatives/long_life.html

Social Initiatives

Hulic outsources logging, planting, and weeding activities toEnvironmental Initiatives

Our Approach to Sustainability

Environmental Initiatives

WEB

Hulic Guidelines for Longer Life Building
https://www.hulic.co.jp/en/sustainability/ecology/waste/initiatives/long_life.html#anc2

We launched the book donation program, which started basedwhich provides educational and cultural support to children in Asia.

on suggestions from employees. In this program, we donate theThis activity contributes to reducing waste and helps to address theproceeds from selling used books collected from group employees

poverty issue.

Data

Book donation program

to the external used book dealer to Shanti Volunteer Association,

Efforts to Recycle* Figures marked withhave been assured by an independent assurance provider.

* T he boundary is Hulic’s headquarter building and buildings where the head offices of Group companies are located. Beginning in FY2020, we are calculating total waste disposal at
specific properties within the boundary by using weight conversion factors based on actual measurements. The results increased from FY2018 as Porte Kanazawa, a large commercial
building, has become subject to aggregation since.

on those efforts to support achieving a recycling society.

Amount of paper recycled (*)
Fiscal year
Recycled amount(Unit: kg)

FY2017
11,365FY201813,125FY201914,540

FY2020

FY2021

15,60013,880External Evaluation

As recycling efforts through daily business activities, we started to recycle used paper and printer toner cartridges. We will continue to work

* The scope is Hulic Head Office Building.

46

Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022

47

Our Approach to Sustainability

Environmental Initiatives

Use of Paper Substitute Materials

Prevention of Pollution

In 2022, we began using LIMEX, a paper substitute made primarily

The Company considers that the minimization of environmental

cooperation with design and construction companies. In addition,from limestone, for the production of our integrated report andpollution due to business activities is indispensable to realize awe aggregate data on SOx, NOx, VOC, and hazardous waste

business cards. Since virtually no forest or water resources are usedrecycling society. When planning buildings, we adopt construction

generated in the development business to monitor the amounts

to manufacture LIMEX, we expect that water consumption duringmethods to reduce pollutant emissions to the extent possible ingenerated, and we disclose the actual results .

the manufacturing processes could be reduced by more than 90%,
compared with using the same amount of ordinary paper.

Amount of emission of SOx, NOx and VOC from hazardous wastes
FY2019FY2020integrated reports can be collected and recycled into alternative

FY2021

Number of properties

10

4

7

9

SOx emissions (kg)

1,620

60

142

826

NOx emissions (kg)11,527

1,334

1,649

6,778

VOC emissions (kg)

157

124

0

0

* Figures are for developed and constructed buildings for which data were collected in each year.

plastic products, in this way helping to realize highly efficient

Environmental Initiatives

FY2018In addition, LIMEX used in place of paper in such products as

resource recycling. We will continue to consider the possibilities of
replacing to LIMEX with a focus on our own publications.

Construction
Adoption of the PC Method

Effect of the PC Method

From the standpoint of a business owner, we proactively
adopt the PC method (*), which can significantly reduce

Initiatives for Water

the amount of waste generated during construction. This

Initiatives to Reduce Water Consumption
Almost all water consumed in the Group are from the buildings

In addition, we are gradually upgrading the toilets in the buildings

minimize impacts on surrounding environments during

owned or the buildings that we have offices, and the water flow

we own to ensure better plumbing while also changing to water-

construction, is highly rated in terms of longer life service ofstarts from tap water and discharge it into sewers. To reducesaving flush toilets and hand washers. The Company is alsobuildings.

the amount of water consumption in buildings owned by theworking to ensure the effective use of water resources by using

Company, we have taken the initiative of introducing water-

rainwater to water the greenery and flush toilets for certain* PC (Precast Concrete) method: Precast panels produced at a plant underconsistent quality control are carried to a worksite and assembled.

saving devices on water taps installed in the plumbing of existingbuildings. Note that Hulic does not operate business activities inbuildings (saves water by approximately 40% per tap) to preservehigh water stress area where demand for water is tight.

Social Initiatives

method, which can shorten a construction period andBenefits of Hybrid Fireproof Wooden Construction*

Rainwater filtration equipment* The figure marked withhas been assured by an independent assurance provider.

*B eginning in FY2021, 220 of Hulic’s fixed assets are covered, excluding properties under development and land for lease. Note that the amount of hot spring water used at hot
spring inns is not included. The boundary from FY2017 to FY2020 is properties with a total floor area of 3,000m2 or more, excluding buildings where bank branch is the sole tenant,as well as sectional and shared ownership properties and real estate for sale.

(Reducing environmental burdens)(Benefits within construction activities)● Reduced-weight materials● Highly accurate pre-cut processing (machining) contributes to-Rationalization of vehicles and heavy machinery insmooth assembly worktransportation and construction operations● Convenience when fixing to other building materials with screws-Reduction of CO2 emissions from transportation● Since structure is finished material, interior finishing costs are● Factory production reduces the amount of onsite work andeliminates onsite waste materials

reduced* Hybrid structure combining wooden and steel framework48

Hulic Co., Ltd. Sustainability Book 2022

External Evaluation● Adoption of floor CLT eliminates need for scaffolding

WEB

Data

Corporate Governancewater resource.

Example of Use 1: HULIC &New GINZA 8 (fireproof commercial building)https://www.hulic.co.jp/en/sustainability/ecology/waste/initiatives/special_feature.html#anc4

Hulic Co., Ltd. Sustainability Book 2022

49

Hulic is carrying out initiatives that increase biodiversity in order to create urban

As a part of our measures against global warming, we have put emphasis on greening of surrounds, rooftops, and walls which can effectively
ease the heat-island phenomenon as well as making buildings more energy efficient.

spaces that are in harmony with nature.
Promotion of Greening of Surrounds, Rooftops and Walls《Results in FY2021》 Number of greening properties: 6 (Coverage: all completed properties each year)* The figure marked withhas been assured by an independent assurance provider.

Biodiversity Guideline
Hulic recognizes the importance of biodiversity's impact for the

Our greening projects aim to create lush green urban spaces as

preventing heat accumulation, thereby reducing air conditioning

well as to harmonize with nature with much consideration toloads on the top floor. Covering the exterior walls of a building

biodiversity. When greening surrounds, we primarily select plants

with plants serves as a countermeasure against the heat islandthat are easy to care and resistant to strong winds so as to improve

effect as well as comforting for passersby. Hulic has jointly

the scenery and appropriate for location. Roof greening makes

developed with other companies a thin-layered wall greening

it possible to save energy in buildings by blocking sunlight andsystem that is easy to introduce to existing buildings.

living environment, and in order to contribute to biodiversity, we
have created the Declaration of Biodiversity Conservation (Hulic's

Hulic JP Akasaka Building (completed in November 2020)

Biodiversity Guidelines) which has been well communicated within

This property is a medium-sized office building facing Sotobori-contributing to the formation of an ecological network in the city

our Group.

dori, jointly developed by the Company and Japan Post Real Estate

and the promotion of biodiversity in the heart of Tokyo.

Furthermore, we have been considerate of and cautiously

Co., Ltd. It is located in the middle of a lush area comprising theThis building received highest rank of “S” in CASBEE-Wellness

executing our businesses that our business should not create any

Imperial Palace, Akasaka Imperial Palace and Hibiya Park, all of

Office* certification (issued by Institute for Building Environment

negative impacts on biodiversity and endangered species.

which are home to living creatures in the center of Tokyo. By

and Energy Conservation). Greening the rooftop and walls willgreening the rooftop and walls, the JP Akasaka Building will serve

enable office workers to sense the four seasons even while in theas a relay point for living creatures to move between habitats,center of the city.

* Comprehensive Assessment System for Built Environment Efficiency (CASBEE) assesses the specifications, performance, and initiatives of buildings that support the health and comfort ofbuilding users, factors that contribute to intellectual productivity improvement, and the performance of safety and security.

Approaches to JHEP Certification
We are also working to ensure that we consider ways to conserve

Society-Japan to quantitatively evaluate and promote biodiversity

and restore local vegetation during reconstruction of properties

conservation initiatives. The number of properties certified totalingfrom the standpoint of preserving biodiversity. We adopted the

13 as of December 31, 2021.

Green walls and wooden conversion of entrance

Corporate Governance

JHEP certification system issued by Ecosystem Conservation

Environmental Initiatives

Fundamental
ApproachGreening Initiatives

Social Initiatives

Initiatives for Biodiversity

Our Approach to Sustainability

Environmental Initiatives

Rooftop gardenof plants including Canarian ivy and evergold are used to cover the

Various trees such as European privet, Japanese boxwood,

wall surface, surrounding terrace benches for approximately 20

agapanthus, fuiriyaburan, and gazania have been planted on thepeople, and provide a transpiration effect to ease the heat-island

rooftop of the expanded building of the Hulic Head Office. In

effect. With this green wall over approximately 106m2, the rooftop

addition, we have placed wooden decks and grown a lawn on thegarden is a space where employees can relax and rest, and feelingsurface.

Rooftop garden

50

Hulic Co., Ltd. Sustainability Book 2022

Wall greening

External Evaluation

Hospitalment Hongo: exterior and garden

nature while working in Tokyo.

Data

Initiatives at the Hulic Head Office Building
On the rooftop garden of Hulic Head Office Building, seven kinds

Rooftop greening

Hulic Co., Ltd. Sustainability Book 2022

51

Information Disclosure based on TCFD Recommendations

Corporate Governance

Hulic Initiatives (Summary)

Recognizing Hulic’s climate change response as an important management issue, we have established a corporate governance mechanism
centered on Board of Director oversight and the Sustainability Committee. This governance mechanism is stipulated in the Basic Regulations

Information Disclosure based on TCFD Recommendations

on Climate Change.

Hulic has formulated Hulic Environmental Policy which embodied
our Sustainability Vision and is executing environmentally friendly

Examples of discussions and decisions made under our climate change-related governance structure:

management. Aiming to continue sustainable growth while● Supporting RE100 initiative and achieving by 2025

mitigating and adapting to climate change through our business● Developing Japan's first fireproof wooden 12-story commercial facility

activities, we announced our long-term vision for the environment,● Achieving converting to a 100% renewable energy for electricity consumption at all Company-owned Buildings* and RE100 ahead

efforts toward the realization of a carbon-free and a recycling-

the TCFD* recommendations in 2020 and started disclosing

oriented society. Recognizing the importance of climate-related

information in line with the recommendations after completing

financial information disclosure, we expressed our support foranalysis and responses on the recommended framework.

* TCFD is an abbreviation for “Task Force on Climate-related Financial Disclosures”, which was established by the Financial Stability Board and has proposed a framework for disclosing
climate-related information to investors.

of schedule● Formulating greenhouse gas (“GHG”) emissions reduction targets in conformance with SBTi (Science Based Targets initiative) criteria,

developing solar photovoltaic equipment that does not use the FIT system● Reducing greenhouse gas emissions in the supply chain*Excludes properties for which we do not have energy management authority including master lease properties, residential properties and non-managerial coownership properties,
and reals estate for sale.

Long-term Vision for the Environment and Roadmap of Initiatives for Achieving the Visionhttps://www.hulic.co.jp/en/sustainability/ecology/management/vision.html

Corporate Governancea) Board of Directors oversight of climate-related risks and opportunitiesb) Management's role in assessing and managing climate-related risks andopportunities● Establish Board of Directors oversight and monitoring structure● Matters related to climate change are deliberated by the

Sustainability Committee, which is chaired by the President andRepresentative Director, who is responsible for climate change

Strategya) Short, medium, and long term climate-related risks and opportunities
identified by the organizationb) The impact of climate-related risks and opportunities on the organization’s
businesses, strategy, and financial planningc) Describe the resilience of the organization’s strategy, taking into accountdifferent climate-related scenarios, including a 2°C or lower scenario● Analyze and evaluate climate change mitigation and adaptations

relating to climate change risks and opportunities, based on a 2°C
or lower scenario and a business as usual scenario● Examine validity of current strategies based on evaluation results

strategies, management plans, annual budgets and profit targets

opportunities from the Sustainability Committee at least once a

are decided after consideration of climate change risks andyear, and monitors and oversees the resolution of issues and setting

opportunities when needed.

of targets. In addition, important matters such as management

Sustainability Committee
Matters concerning climate change are deliberated andCommittee also sets KPIs related to sustainability, including climate

coordinated by the Sustainability Committee.

change, and evaluates progress by reviewing performance.

The Sustainability Committee, which is chaired by the President
and Representative Director, who is responsible for climate change,
is composed of the Vice Presidents, the General Manager of theBusiness Planning and Management Department, the General

Risk Managementa) Organizational process for identifying and assessing climate-related risks

The Board of Directors receives reports on climate change risks and● T he Sustainability Committee centrally deliberates climate change

matters including risk management and reports to the Board of Directors● The Risk Management Committee evaluates and deliberates climateb) Organizational process for managing climate-related riskschange risks from a Group-wide risk management perspective andreports to the Board of Directorsc) Describe how processes for identifying, assessing and managing climate● The Board of Directors receives reports from the Sustainability andrelated risks are integrated into the organization’s overall risk management
Risk Management Committees and oversees climate change risks

Manager of the Real Estate Planning Department and Group
company executives. The Committee evaluates the impact ofclimate change on business at least once a year, formulates
policies and strategies for mitigating identified risks and seizing
opportunities, and discusses how to adapt to climate change,

Members
President, Vice Presidents, General Manager of Business
Planning and Management Department, General Manager
of Real Estate Planning Department
Observers
Group company executives, Full-time Audit & Supervisory
Board members
Secretariat
Corporate Sustainability Department

Corporate Governance

Hulic Initiatives (Summary)Social Initiatives

Board of Directors Oversight

TCFD Disclosure Recommendations and Hulic Initiatives (Summary)
TCFD Disclosure Recommendations

Environmental Initiatives● Supporting TCFD recommendations and disclosing information in line with the recommendations

with 2050 as the target achievement year and are proceeding withWEB

Our Approach to Sustainability

Environmental Initiatives

including reflecting its impact in plans, budgets and targets. The● Set climate change KPIs (non-financial key performance indicators)

and related indicators, disclose progress toward achieving targets
on Hulic website, etc.
•R
 eductions in greenhouse gas emissions*1 (compared to 2019 base year)
2024

b) D
 isclose Scope 1, Scope 2, and, if appropriate, Scope 3 greenhouse gas(GHG) emissions, and the related risks

Scope1+2*2

Reduce by 70% Reduce by 70%

3

Scope3*c) D escribe the targets used by the organization to manage climate-relatedrisks and opportunities and performance against targets

2030

－

2050
Substantiallyzero emissions

Management Responsible for Climate Change
The President and Representative Director is responsible forthe impact of climate change on Hulic business and manages

the matters related to climate change. The President andappropriate responses. The Basic Regulations on Climate Change,

Representative Director serves as the Chairman of the Sustainability

which stipulate items related to climate change, are a matter forCommittee, and is ultimately responsible for assessments ofapproval by the President.

Substantially
Reduce by 30%
zero emissions

External Evaluationa) Disclose the metrics used by the organization to assess climate-related risks
and opportunities in line with its strategy and risk management process

Data

Metrics and Targets• Achieving RE100 by 2024
• Number of times the Sustainability Committee engaged in climatechange monitoring• Number of Environmental Advisory Council held

*1 Absolute contraction targets, Base year: 2019. Hulic has had its near-term (by 2030) emissions reduction targets approved by the Science Based Target initiative as consistent with levels
required to meet the goals of the Paris Agreement.
*2 Greenhouse gas emissions from directly owned or controlled sources plus indirect purchased energy for business activities.
Scope1: Direct emissions (e.g., emissions from natural gas and other fuel combustion)
Scope2: Indirect emissions (e.g., emissions from the use of purchased electricity, heat and steam)*3 Greenhouse gas emissions from external companies affiliated with internal business activities (in the supply chain). Targets were set for Categories 11 and 13, which cover approximately
80% of Scope3.

52

Hulic Co., Ltd. Sustainability Book 2022

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53

and management of climate change-related items as well as thepromotion of climate change responses throughout the Group.

physical risks in the scenarios we examined, and have found that

adapting to climate change, through business activities, andour business is sustainable and our strategy is suitably resilient.

change, managing identified impacts and integrating them into

we recognize that our climate change response is an important

Based on our motto of “Driving Innovation and Acceleratingrisk management across the organization.

management issue. The effects of climate change are expected toProgress,” we are going ahead with a business model that is able

become more apparent over time, so we analyzed the impact of

to flexibly respond to changes in external environment. Going• Developing indicators used to measure and manage the impact

Specific items include:of climate change, and set goals, tracking performance andrisks and opportunities on our strategy using multiple climate change

forward, we plan to mitigate climate change related risks by flexibly• Leading the monitoring of climate change impacts inreporting progress to the Sustainability Committee at least once a

scenarios and examined resilience of our current strategies including

evolving our business model against social transformation towards

year.

the need to change management plans and basic strategies.

decarbonization. We concluded that we will be able to continue

At Hulic, we have been taking actions on strengthening earthquake

improving our corporate value by building a competitive advantage

conjunction with related departments within Hulic and Group
companies, understanding status and submitting reports and• Submitting reports and recommendations as needed to the Risk

recommendations on appropriate measures to the Sustainability

Management Committee regarding identified climate change

resistance and disaster prevention measures of our properties,

in the leasing and development businesses as valuations increase

Committee at least once a year.

impacts, and integrating them into Group-wide risk management.

as well as implementing environmental initiatives including

for environmentally friendly technologies adopted in our properties

decarbonization. As a result, we have found no potential financial

and seizing opportunities in providing new products and services in

impacts that were deemed large related to both transition andthe environment-related business field.

Environmental Advisory Council
Hulic receives advice and recommendations on environmental
issues from specialized and technical knowledge and objective
viewpoints. To promote efforts to create value for society, we havebeen holding regular Environmental Advisory Council meetingscomprising external advisors and top management once a year
since 2010.
We also receive advice and suggestions from external advisors on
matters related to climate change that are discussed directly by top
management, which is leveraged for management decision-making
regarding the planning of climate change-related measures.

External Advisors
Toshiharu Ikaga: Professor, Keio University
Yoshihiro Fujii: Representative Board Chairman, Research Institutefor Environmental Finance (RIEF)
Takao Kashiwagi: Specially Appointed Professor & Emeritus
Professor, Tokyo Institute of Technology
Keisuke Takegahara: Deputy Chief Research Officer, Chief
Manager of Sustainability Management Office, Corporate Planning& Coordination Department, Development Bank of Japan Inc.
Management Members from Hulic
Chairman, President, Vice Presidents, GM of Corporate
Sustainability Department, Group company executives

Climate Change-related Corporate Governance Diagram

Time Horizon for the Short, Medium, and Long-term
While the real estate industry makes business plans looking 10

clime change effects in conformity with timeline of our long-term

years into the future, the effects of climate change will likely

vision for the environment, as well as the target years set by the

become apparent over a far longer period. We have established

Paris Agreement and Japanese government.

short-, medium- and long-term time horizons when analyzing the

Hulic's climate change time horizon: confirming with Hulic long-term vision for the environment andgreenhouse gas emissions reduction targets
Short-term
Climate Change

Medium-termLong-term

2025

2030

2050

5 years

10 years

30 years
2050

Long-term Vision for the Environment

Hulic's management and businesstime horizons

GHG Emissions Reduction Targets*1
2024

2030

Scope 1 and 2*2 Reduce by 70% Reduce by 70%
Scope3*3n.a.

Reduce by 30%

2050
Substantially zero emissions

Medium- and Long-Term Management
Plan (2020-2029)

Substantially zero emissions

Phase I

Phase II

Phase III

3 years

3 years

4 years

By 2022

By 2025

By 2029*1:Absolute contraction targets, Base Year: 2019. Hulic has had its near-term (by 2030) emissions
reduction targets approved by the Science Based Target initiative (SBTi) as consistent with levels

Environmental Initiatives

related matters and is responsible for the planning, proposal

Hulic aims to maintain sustainable growth, while mitigating and• Designing processes to identify and assess the impact of climate

Social Initiatives

Corporate Sustainability Department is in charge of climate change-

Strategy

Corporate Governance

Department in Charge of Climate Change-related Matters

Our Approach to Sustainability

Environmental Initiatives

required to meet the goals of the Paris Agreement.
*2:Greenhouse gas emissions from directly owned or controlled sources plus indirect purchased energy for business activities.

*3:Greenhouse gas emissions from external companies affiliated with internal business activities (in the supply chain). Targets were set for Categories 11 and13, which cover approximately 80% of Scope 3.

Data

Scope1: direct emissions (e.g., emissions from natural gas and other fuel combustion).
Scope2: indirect emissions (e.g., emissions from the use of purchased electricity, heat and steam).

54

Hulic Co., Ltd. Sustainability Book 2022

In assessing the financial impact of climate change, we used

95.6 billion in FY2020 and a forecasted JPY 100 billion in FY2021.

consolidated ordinary income among other earning indicators

For classifying impact, we referenced criteria for revising earnings

including net sales, operating income, ordinary income, and profit

forecasts, a 30% increase or decrease in the consolidated ordinary

attributable to owners of parent as it is especially important key

income forecast among the "important matters" of the timely

earning indicator for us. We have set the following criteria based

disclosure standards of financial instruments exchanges and set

on the latest financial results of consolidated ordinary income: JPY

such impact as “large”.

Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

Financial Impact of Climate Change

55

Financial impact matrix

Evaluation of Climate Change-related Risks and Opportunities

Impact Classification

Ratio to Consolidated Ordinary Income

Amount / YearLarge

30% or higher

JPY 30 billion or more

Medium15% or higher, less than 30%

JPY 15 billion or more, less than JPY 30 billion

Small

5% or higher, less than 15%

JPY 5 billion or more, less than JPY 15 billion

MinimalLess than 5%Less than JPY 5 billion

1. Identifying Key Drivers of Material Risks and Opportunities
As a pre-process for selecting a group of climate change scenarios,(factors that could have a significant impact on our business). At

for each type of climate change risk and opportunity according to

the same time, we excluded risks and opportunities that were

TCFD, we identified the key drivers of risks and opportunities that

deemed less impactful and relevant. Identified key drivers of risks

could be important to our business and our major stakeholders

and opportunities were as below:

Our Approach to Sustainability

Environmental Initiatives

businesses that could have a large impact from climate change.

outlined by TCFD. Regarding risks, departments within the RealAs a result, real estate and the environment-related businesses

Estate Business Division, the Planning and Administration Division,

were deemed to have large impacts from climate change, we

and the department responsible for environmental technologies

selected these businesses for a scenario analysis. We may consider

first evaluate the inherent risks for each risk type based on theto add other businesses to the climate change scenario analysis

likelihood of event and the degree of impact. The residual risk

when these become significantly impacted by climate change andwas then determined by considering the control effectiveness.

important.

Opportunities were also evaluated based on the likelihood ofBusinesses subjected to climate change scenario analysis• Real estate leasing business• Real estate development business, Value-added business• Environment-related businessType according to TCFD
Risk Category

Drivers

Risk Type・Strengthened CO2 emission regulations
・Increased CO2 emission pricing
・Strengthened energy saving standards
・Increased subsidies to promote zero CO2emissions from buildings

・Primary energy reductions
・Carbon pricing
・Negative emission policies
・CO2 emission control regulations on buildings
・Disclosure of energy-saving performance
・ZEB/renewable energy subsidies

・Advances in building equipment
technologies
・Advances in clean energy supply
technologies

・Advances in fireproof wooden construction technologies
and cost fluctuations
・Advances in ZEB technologies and cost fluctuations
・Advances in renewable energy and cost fluctuations
・Advances in storage battery technologies and cost
fluctuations

・Increased awareness of environmental
issues・Changes in company or tenant behavior

Acute・Increase in natural disasters

・Increase in torrential rains
・Increase in typhoons
・Increase in flooding

Chronic

・Chronic climate change

・Increase in average temperature・Rise of sea level

Policy and Legal

Transition Risks
Technology

Businesses excluded from scenario analysis

Identified Key Drivers• Tourism-related business• New and other businesses

Process for Identifying Businesses with Large Impact from Climate Change

Society (Market,
Reputation)

Physical Risks

Key Drivers of Identified Opportunities		
Type according to TCFD
Opportunity Type

Drivers

Identified Key Drivers

Resource Efficiency

・Advances in clean energy supply technologies
・Reduced CO2 emissions
・Advances in building equipment technologies

・Advances in renewable energy and cost fluctuations
・Adapting to the possibility of increase in expense due to theintroduction of carbon taxes
・Advances in fireproof wooden construction technologies andcost fluctuations
・Advances in ZEB technologies and cost fluctuations
・Advances in storage battery technologies and cost fluctuations

Energy Source

・Development and use of renewable energy

・Advances in renewable energy and cost fluctuations

Products and Services

Markets

・Rise in asset value and rents of environmentally friendly
・Increasing demand for products and services thatbuildings
support disaster prevention and energy conservation
・Growing need for renewable energy and increasing ・Advances in ZEB technologies and cost fluctuations
revenue opportunities from selling electricity
・Energy conservation and renewable energy cost fluctuations
・Creation of new markets that contribute to theresolution of climate change
・Increased opportunities for collaborative projects
with governments, municipalities, and privateorganizations to realize a carbon-free society

・Improved competitive advantage of environmentally friendly
buildings
・Increased profits from new market entry
・Profit opportunities through collaborative projects

2. Formulation of Climate Change Scenarios
The TCFD recommendations propose explaining the resilience of

scenario by referring multiple climate change scenarios that include

our company strategies in light of an analysis based on different

key drivers for the material risks and opportunities that wereclimate-related scenarios including a 2°C or lower scenario.

identified.

Social Initiatives

according to the type of climate change risks and opportunities as

scenarios

Corporate Governanceevent. By integrating the results of these assessments, we selected

Data

For each Hulic business, we assessed the impact of climate change

External Evaluation

Key driver: Factors that are likely to have a large impact on Hulic business and as such parameters were collected when creating

Environmental Initiatives

Key Drivers of Identified Risk

Businesses Largely Impacted by Climate Change

We formulated a 2°C or lower scenario and a business as usual

56

Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022

57

[Physical risks] Temperature rise, sea level rise, natural disasters (typhoons, floods, wind damage)
Organization NameThe Intergovernmental Panel on
Climate Change (IPCC)

Document Name
Representative Concentration
Pathways (RCP) Scenario of Fifth
Assessment Report (AR5)Business as Usual Scenario

2°C or Lower Scenario

RCP8.5

RCP2.6

Climate Change Observation,
Ministry of the Environment, Japan
Forecast and Evaluation Integrated
Meteorological Agency, etc.
Report 2018

Forecast for annual averagetemperatures across Japan basedon IPCC AR5 RCP8.5

Forecast for annual averagetemperature across Japan
based on IPCC AR5 RCP2.6

Climate Change Adaptation
Information Platform (A-PLAT)

Observations by meteorologicaloffices, etc.

RCP8.5

RCP2.6IPCC

The Ocean and Cryosphere in a
Changing Climate (2019)

RCP8.5

RCP2.6

Aqueduct

Aqueduct Flood (2020)

Business as usual, RCP8.5, SSP2

Optimistic, RCP4.5, SSP2

Ministry of Land, Infrastructure,
Transport and Tourism, TechnicalStudy Group on Hydraulic Control
Plans Based on Climate Change

Hydraulic control plan based on
climate change (2019)

RCP8.5

RCP2.6

Environmental Initiatives

Overview of Two Scenarios

Our Approach to Sustainability

Environmental Initiatives

3. Risk and Opportunity Assessment
To examine the impact of climate change risks and opportunities on Hulic’s strategy, we evaluated transition risks and opportunities

in the “medium-term” on the time horizon with the degreeterm Management Plan against social transformation towardsof impact at that time was assessed “medium.” On the otherdecarbonization by leveraging our motto of “Driving Innovation

hand, the financial impact of climate change opportunities

and Accelerating Progress.” In addition, as valuations increase

was assessed greatest over the “long-term” and the financial

for environmental initiatives for owned properties, we will build a

The following is a group of climate change scenarios for which

values when the parameters for the exact length of time were notimpact at that time was assessed “large.” Under the 2°C orcompetitive advantage in the leasing and development businesses.

parameters for the identified key drivers were collected whenfound in a scenario group.

lower scenario, we concluded that we will be able to continue

Furthermore, for the environment-related business field, we will

formulating climate change scenarios. We also used estimatedimproving our corporate value through risk mitigation by flexibly

seize opportunities in providing new products and services.

Referenced Major Climate Change Scenarios■Continue on the basic strategies of current Medium-and Long-term Management Plan (further develop and evolve ourbusiness model based on the real estate leasing business)[Transition Risks] Policy and legal, technology, market, society, reputation
Organization Name

58

evolving our business model based on current Medium-and Long-International Energy
Agency (IEA)

Document NameBusiness as Usual Scenario

2°C or Lower Scenario

World Energy Outlook 2019

CPS (Current Policies Scenario),
STEP(Stated Policies Scenario)

SDS (Sustainable Development
Scenario)

IEA

Perspectives for the Clean Energy
Transition, The Critical Role of
Buildings (2019)

NPS (New Policies Scenario)

FTS (Faster Transition Scenario)

2 Degrees Investing

The Transition Risk-O-Meter:
Reference Scenarios for Financial
Analysis (2017)

LCT (limited climate transition with
3-4°C decarbonation range) Scenario

ACT (ambitious climate transition
with 2°C transition) Scenario

Institute for Global
Environmental Strategies(IGES)The “net zero world” in 2050 Japan
Lock-in scenario(tentative plan)(2020)

Hulic Co., Ltd. Sustainability Book 2022

[Risk]:・ Ability to promptly respond to a wide range of policies andregulations introduced as climate change countermeasures[Opportunity]:・ Environmental measures implemented at Company-owned
properties become highly valued as social transformation
occurs・O pportunities to entering new markets that help mitigate
climate change will be created

Data*1:For scenarios where the global average temperature rise is limited to 2°C or lower with at least 50% rate by 2100, the TCFD recommended it is imperative that one of the climatechange scenarios be a 2°C or lower scenario*2:Temperature rises from 3.8°C to 6.8°C between 2081 and 2100 in scenarios without additional measures/responses for climate change mitigation and adaptation

The financial impact of climate change risk was assessed greatest

External Evaluation

2°C or Lower Scenario Transition Risks and Opportunities

Corporate GovernanceSocial Initiatives

in the 2°C or lower scenario and physical risks and opportunities in the business as usual scenario.

Transition scenario

Hulic Co., Ltd. Sustainability Book 2022

59

■Hulic’s Basic Strategies■Conclusion:・We plan to mitigate climate change related risks by flexibly evolving our business model based on current Medium-and Long-termManagement Plan against social transformation towards decarbonization by leveraging our motto of “Driving Innovation and Accelerating
Progress.” against social transformation towards decarbonization.
・We concluded that we will be able to continue improving our corporate value by building a competitive advantage in the leasing anddevelopment businesses as valuations increase for environmentally friendly technologies adopted in our properties and seizing opportunities

Financial impact matrix
Impact Classification* Stages I, II, and III: displays progress in stages.

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Hulic Co., Ltd. Sustainability Book 2022

Ratio to Consolidated Ordinary Income

Amount / YearLarge

30% or higher

JPY 30 billion or more

Medium15% or higher, less than 30%

JPY 15 billion or more, less than JPY 30 billion

Small

5% or higher, less than 15%

JPY 5 billion or more, less than JPY 15 billion

MinimalLess than 5%Less than JPY 5 billion

Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

Data

Corporate GovernanceSocial Initiatives

Environmental Initiatives

in providing new products and services in the environment-related business field.

Our Approach to Sustainability

Environmental Initiatives

61

Risk Management

Business as Usual Scenario Physical Risks and Opportunities
Physical risks become apparent as greenhouse gas emissionsacquired, as well as the mitigation of physical risks through design

Matters related to climate change, including risk management, are centrally deliberated and coordinated by the Sustainability Committee,

continue to climb and climate change remains unmitigated.

standards and disaster prevention measures in Hulic properties.

which is chaired by the President and Representative Director, under the oversight of the Board of Directors.

However, the financial impact of climate change has been

Looking at our opportunities, we believe that there will be no

estimated as “minimal” on the back of a detailed examination offinancial impact as we do not expect any additional opportunities

natural disaster risks conducted when properties are developed orfrom climate change.

[Risks]:・Physical risks, such as natural disasters due to climate change,
will become apparent[Opportunities]:
・Opportunities up to 2030 have already been incorporated
into the Medium-and Long-term Management Plan・N
 o additional opportunities pertaining to climate change
after 2030 and therefore no financial impact

Corporate Sustainability Department, which is incharge of matters related to climate change, leads theidentification of risks and opportunities and monitors
the effects of climate change in conjunction with related

Environmental Initiatives■Maintain current priority area, location policy and portfolio composition by use as described in the current Mediumand Long-term Management Plan

Mechanism for Identifying and Assessing Climate Change Risks and Opportunities

departments within Hulic and Group companies. In
addition, appropriate measures are considered and reports
and recommendations are submitted to the Sustainability
Committee at least once a year.
The Sustainability Committee deliberates and evaluates■Conclusion:

the reported impacts of and recommended responses
1• Sea level rise: The assumption that average global sea levels will rise 0.45 to 0.82 m*after 2081 is out of scope• Temperature rise: The increase in air-conditioning-related costs (costs for improving air-conditioning equipment and utility costs due to risingtemperatures) is minimal

to climate change. Risk assessments are reported atleast once a year or as needed to the Board of Directors,
coordinated by the Sustainability Committee.

• W ind damage (typhoons): Considering past typhoon damage experiences, the impact was determined to be minimal

The Board of Directors receives reports from theSocial Initiatives

along with other climate change matters deliberated and• Flood damage (typhoons, torrential rain, floods, inland water, storm surges): Minimal due to measures already taken

Sustainability Committee on climate change matters,

Sea level
rise

Average global sea levels rise 0.45 to
0.82 m*1 (comparison with the 1986–
2005 average in 2081–2100)

Flooded/submerged

Japan's temperature rises 1.1 to 3.1
degrees Celsius (2031–2050)-Increased cost of
air-conditioning
equipment
expansion-Increased energy
costs

Temperaturerise

Occurrence

Out of scope ofanalysis

MinimalBasis for Financial Impact
Assessment
Not applicable to the time
horizon (up to 2050)
If temperature rises +3.1°C in
2030:
・Increase in costs related toair-conditioning equipment
expansion: Minimal
・Energy cost increases: Minimal

Number of typhoons approaching Japandecreases or pattern changes
Typhoons

Acute
Risk

There is a strong possibility that thefrequency of severe typhoons (category
4 or higher, maximum wind speed 59
m/s or higher) will increase over thesouthern seas of Japan

Flood damage

Storm surgeHigh tides with a recurrence period of
100 years occurs every year (2050–2070)

Flood damage

Torrential
rain

Increased frequency of short-term heavy
rainfall in all regions and seasons

Flood damage

FloodsFrequency of flooding quadruples (2100)

Inlandwaters

The frequency of inland flooding
increases in proportion to increase intorrential rains*1.Compared wirh 1986 –2005 average. Shown as highly likely in the IPCC RCP8.5 scenario

MinimalMinimalMinimaloversees the efforts to address issues and the targets set.

Mechanism for Managing Climate Change Risks
Corporate Sustainability Department, which is in charge of mattersstrategies for minimizing the identified risks and reflecting them

related to climate change, engages in planning, proposals andin planning, budgets and targets. The status and response to risk

management related to climate change, including the process

management deliberated and coordinated by the Sustainabilityof identifying and assessing the impact of climate change, theCommittee is reported, along with other agenda items, at leastmechanism for managing identified impacts and the mechanism

once a year or as needed to the Board of Directors.

for their integration into Group-wide risk management. The

The Risk Management Committee meets regularly to evaluate

Department also submits reports and recommendations to thereports and recommendations from each risk management

Sustainability Committee and promotes Group-wide responses

department, discuss Group-wide risks and take appropriate

to climate change. It also plays a role in integrating the impact

measures, and reports to the Board of Directors. When there areof climate change into Group-wide risks by submitting reports

reports or recommendations regarding the impact of climate change,

and recommendations when necessary to the Risk Management

the Risk Management Committee will determine appropriate

Committee regarding the identified impacts of climate change.

measures from the perspective of Group-wide risk management.

Implementing countermeasures
for flood damage

The Sustainability Committee deliberates and evaluates the

The Board of Directors receives reports on climate change risk

reported impacts of and recommended responses to climate

management and responses from the Sustainability and Risk

Implementing countermeasures
for flood damagechange. In addition, deliberations and coordination are made toManagement Committees, and oversees such risk management

adapt to climate change, including the formulation of policies andand responses.

Implementing countermeasures
for flood damage

Flood damage

Flood damage

Damage caused by pasttyphoons: Minimal

including the risk management status and response, andImplementing countermeasures
for flood damage

Organization/Department
Board of Directors

Function• R eceives reports on climate change risk management and responses from Sustainability and Risk Management Committees, andoversees such risk management and responses• D eliberates and evaluates the reported impacts of and recommended responses to climate change

Sustainability Committee• D eliberates and coordinates in order to adapt to climate change, including the formulation of policies and strategies forminimizing the identified risks and reflecting them in planning, budgets and targets• T he status and response to risk management deliberated and coordinated by the Sustainability Committee is reported regularly

and as needed to the Board of Directors

Risk Management Committee
Corporate Sustainability
Department (Department incharge of climate changerelated matters)

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Hulic Co., Ltd. Sustainability Book 2022

Corporate GovernanceRisk Scenario

Data

Chronic
Risk

Risk Event

Evaluation on
Financial Impactof Climate Change• D etermines appropriate measures from the perspective of Group-wide risk management and reports to the Board of Directors

External Evaluation

Types ofRisk

Our Approach to Sustainability

Environmental Initiatives• E
 ngages in planning, proposals and management related to climate change, including the process of identifying and assessing

the impact of climate change, the mechanism for managing identified impacts and the mechanism for their integration into
Group-wide risk management• P romotes Group-wide responses to climate change• S ubmits reports and recommendations to the Sustainability Committee and Risk Management Committee

Hulic Co., Ltd. Sustainability Book 2022

63

RE100 Progress Rate

Key Performance Indicators (KPIs)

RE100 stands for “Renewable Electricity 100%,” an international

occupied by Group companies. We plan to provide all of theinitiative aimed at using only renewable energy as the source ofapproximately 60 GWh of electricity used annually by Group

Hulic identifies materiality and the Sustainability Committee sets

Climate change KPIs, results and progress assessments are aselectricity used in business activities.

companies from Hulic-owned renewable energy sources by 2024,

key performance indicators (KPIs) for each materiality and evaluates

follows.

Hulic joined RE100 in 2019, and in 2020, started to develop

and in order to achieve that goal we set progress target for eachphotovoltaic equipment that does not use the FIT system (non-fiscal year as a milestone. When RE100 is achieved in 2024, Hulic

FIT). Electricity derived from non-FIT renewable energy generated

Group’s electricity-derived greenhouse gas emissions will becomeby Hulic-owned power sources will be supplied by Group company

zero.

progress by reviewing results.

Specific Targets

Coverage

Scope 1+2*2
2024 reduced by 70%;2030 reduced by 70%;2050 substantially zero(base year: 2019)

Scope1 and 2: Properties
where the Hulic Grouphas control of energy
management

Scope3*32030 reduced by 30%;2050 substantially zero(base year: 2019)

Scope3: Indirect emissions
other than Scope1 and 2
related to Hulic Group’sbusiness activities

10% in 2021
30% in 2022
65% in 2023
100% in 2024

Electricity used in Hulic
Group business activities

13.5%

〇

One or more times
annually

Hulic Co., Ltd.

1 time◎Number of Environmental Advisory One or more times
Council held
annually

Hulic Co., Ltd.

1 time◎4

The RE100 progress rate*

Number of times the Sustainability
Committee engaged in climatechange monitoring◎: achieved〇: progressed

Major related SDGs

retail electricity supplier (PPS), Hulic Property Solutions, to buildings

Number of Times the Sustainability Committee Engaged in Climate Change Monitoring and Number
of Environmental Advisory Council Held〇28%

We have set the above as KPIs with the aim of confirming the operational status of corporate governance related to climate change.
Organization• Evaluates the impacts of climate change on business, and takes steps to mitigate identified risks and〇8%

Confirmation of Operational Status

Sustainability Committee

generate opportunities• Sets KPIs for sustainability, including climate change, reviews performance and manages progress

Environmental Advisory
Council• Top management directly discuss and receive advice and suggestions from external advisors on our

initiatives related to environment including climate change

Social Initiatives

Greenhouse gas emissions
reduction targets*1

2021

Corporate Governance

KPIs(non-financial key performanceindicators)

Assessment

The following are managed as other related indicators.

Related Indicators

Related KPI

Annual generation of renewable energy

RE100 progress rate*4

Amount of investment in solar photovoltaic equipment that does not use the
FIT system

Greenhouse gas
emissions reduction
targets*1

Specific Numerical
Values and Targets

Environmental Initiatives

Metrics and Targets

Our Approach to Sustainability

Environmental Initiatives

ResultAssessment

2020

2021

◎: achieved〇: progressed

Approximately 60
GWh(annually)

283,759kWh

8,076,601kWh〇

Approximately JPY
66 billion (cumulative
amount by 2030)

JPY 1.1 billion

JPY 3.5 billion

〇

Data

*1:Absolute contraction targets, Base year: 2019. Hulic has had its near-term (by 2030) emissions reduction targets approved by the Science Based Target initiative as consistent with levels
required to meet the goals of the Paris Agreement.
*2:Greenhouse gas emissions from directly owned or controlled sources plus indirect purchased energy for business activities.
Scope 1: direct emissions (e.g., emissions from natural gas and other fuel combustion).
Scope 2: indirect emissions (e.g., emissions from the use of purchased electricity, heat and steam).
*3:Greenhouse gas emissions from external companies affiliated with internal business activities (in the supply chain). Targets were set for Categories 11 and 13, which cover approximately
80% of Scope 3.
*4:Targets are set according to the amount of power generated by Company-owned non-FIT solar photovoltaic equipment during the target year divided by the total amount of electricity
used at the Hulic head office building and on the floors occupied by Group companies in one year (an estimate of final target year).

External Evaluation

Rationale for each KPI
Greenhouse Gas Emissions Reduction Targets
In accordance with Hulic’s long-term vision for the environment,

our proprietary solar photovoltaic equipment. Hulic believes that it

we established medium- to long-term targets for climate change tois important to take actions to combat climate change by reducing

reduce greenhouse gas emissions. We plan to achieve these targets

greenhouse gas emissions in Scope 1 and 2 as well as throughout

by converting electricity consumption of all Company-owned

the value chain (Scope3).

buildings* to renewable energy sourced electricity generated by*Excludes single-tenant lease properties, residential properties, unmanaged shared properties for which we do not manage energy, and real estate for sale.

64

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65

Hulic places emphasis on dialogues with our
stakeholders and aims to achieve a society where
people live safely, securely, and comfortably.

Initiatives for Customers

Earthquake-damping Structures

By isolating the building from the ground with a mechanism called

With earthquake-damping materials installed inside the building,

an isolator, seismic energy is absorbed to reduce the intensity ofinternal seismic energy is absorbed to reduce the intensity ofshaking to 10%-50% compared to other general earthquake-shaking from half to one thirds compared with other general

resistant structures as a general building structure. Anotherearthquake-resistant structures. We apply priority to using thesefeature of this structure is that how a building shakes during an

structures when the shape and size of the planned building site isearthquake does not differ significantly between upper floors andnot suitable for an earthquake-absorbing structures.

lower floors of the building.

Hulic has incorporated this method in many properties. Hulic uses
this method not only in offices but also in hotels and commercial
buildings.

We are constantly working to generate new added value by offering properties that are superior
in terms of safety, environmental performance, and convenience.
In addition, we have established various emergency and disaster scenarios, for which we havecreated measures to improve the structural performance of our buildings, as well as operationaland management aspects of buildings.

Environmental Initiatives

Fundamental
Approach

Earthquake-absorbing Structures

Our Approach to Sustainability

ESG

Social Initiatives《Results in FY2021》 100% Properties Meeting Hulic's Earthquake-resistance Standards
Customer satisfaction: 92.2%

Act, and we apply these standards to all the buildings that we

priorities for a real estate developer in Japan as it is one of thedevelop or reconstruct, and we conduct a seismic assessment atcountries where earthquakes most frequently occur. We believe

the time of acquisition. We will promote strengthening seismic

it is our responsibility to provide earthquake-resistant building

resistance to ensure that all Company-owned buildings cansafety in order for the tenants to conduct social activities withwithstand an earthquake of seismic intensity 7 level by 2029.

peace of mind. We have therefore established our own earthquake* Earthquake-resistance standards as specified by Hulic are where building performancecan safeguard human life and enable continued use of the building with postearthquake repair in the event of an earthquake with a seismic intensity of 7 level.

resistance standards* that are stricter than the Building Standards

Earthquake Resistance Diagnosis, Reinforcement
Works, and Confirmation of Validity of Structural
Calculation

Liquefaction Countermeasures
After the Great East Japan Earthquake, extensive regions including

on ground with possible liquefaction. However we concluded thatcoastal areas in Tokyo suffered from liquefaction, which caused

these buildings were not significantly affected by liquefaction due

damage such as buildings leaning over and sinking.

to the fact that the planning of appropriate building foundations

According to the liquefaction map issued by the government, it

befitting the sites.

was found that six buildings owned by the Company were locatedWe diagnosed the earthquake resistance of all Company-owned
properties* that were built before the new earthquake resistance

Measures against Water Damage

standards were established in the Building Standards Act revisedin 1981, and all buildings that did not meet the standards were

When electric facilities are damaged by floodwater, the supply of

in a flood, and examine application of flood control measures toseismically reinforced.

power, which is essential for the use of a building, can stop fortake necessary measures as needed in supposition for localized

an extended period. We investigate the status of buildings withheavy rains caused by climate change and tsunamis caused bypower receiving and transforming equipment and private power

earthquakes.

* E xcludes buildings with box frame type reinforced concrete construction and buildingsthat were to be demolished.

Seismic reinforcement using steel brace (LICOPA Tsurumi)

Corporate Governance

Hulic considers earthquake countermeasures as one of the top

Social Initiatives

Thorough Implementation of an Earthquake Resistance Diagnosis and Seismic Reinforcement

Data

generators that are installed in floors expected to be submerged

Proactive Adoption of Earthquake-absorbing and Earthquake-damping Structures
Efforts toward the Improvement of Customer Satisfaction

In order to protect human life and functions of facilities from large
scale earthquakes, we have imposed high seismic capacity on

As office buildings, stores, and residences owned by Hulic serve as

In order to satisfy all customers using buildings including tenants

newly constructed buildings. With the aim of protecting customers'

the infrastructure for customer's social activities, we are aiming toand visitors to the buildings, we thoroughly stick to meticulous

lives and contributing to business continuity, we have proactively

constantly improve their quality under the philosophy of providing

quality control, careful maintenance, and security to protect assets.

adopted an earthquake-absorbing or earthquake-damping

customers safety, peace of mind and convenience.
External Evaluation

structure which is effective at ensuring a high seismic capacity, in
addition to other methods to improve the seismic capacity.

Earthquake-absorbing equipment

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67has mainly reflects our planned

Each year, Hulic evaluates the implementation status of＜Primary evaluation items＞

of Hulic’s properties. Survey items include matters concerningfacility reinforcement and quick

management work and provides property management companies-Confirm to check if maintenance work for buildings and facilities,building hardware and software, and things customers have

response to the matters requested bywith feedback to improve and standardize the quality of their

including complying with legal requirements applicable tonoticed while using our buildings on a daily basis. We carefully

customers. Furthermore, the persons

work.

buildings, has been performed systematically and thoroughly

go over the customer responses, and then take steps to identify

in charge responded or replied to

We use the results of evaluations as information to decide whether

without omissions as stipulated in the contract.

customer needs and make improvements accordingly. In the survey

customers' opinions and requests

to continue to entrust management work with the current property-Confirm the status of legal compliance, including the status of

conducted in 2021, we continued to receive high ratings with aafter the survey.

management companies in accordance with the rules for real

renewing the verification due date of measuring instruments, etc.

estate outsourcing management.

and submission of mandatory inspection results reports to thesatisfaction level of 92.2% (in 2020, 96.4%). We believe the results

relevant regulatory authorities.
-Confirm that defects occurring unexpectedly, including those pointed

Initiatives for Providing Healthy and Comfortable Spacesout during the legal inspection, have been fixed without delay.

Hulic is undertaking the following initiatives to provide healthy and comfortable properties to our stakeholders.
materials, etc. for existing properties and properties being
developed (Use of interior finishing materials and fittings that do
not contain toxic substances)● Active Introduction of natural ventilation and greening ofbuilding surrounds● Introduction of an indoor air quality improvement system using

composite ceramic functional materials● Measurement of indoor environment at and periodic

measurement after completion● Active upgrading to energy-saving equipment and otheradvanced equipment● Conducting of preventive maintenance before issues arise inbuilding or equipment● Many of the properties owned are located near stations,providing easy access to transportation● Acquisition of CASBEE Wellness Office certification for developed

office buildings as verifications for buildings that support the

Responsible Marketing
Hulic has set out the principle of “treating clients faithfully andWith regard to important company information, we aim to disclose

kindly, listening to their requests with sincerity and providing

information with accuracy based on the facts, and in a way thatsophisticated, efficient, and high-quality services” in the Basicis easy to understand in accordance with the rules for disclosure

Principles of Corporate Conduct and endeavors to build positive

control. Furthermore, we disseminate information through various

relationships with clients. In addition, we obtain the necessary

media by creating a company website, publishing press releases

permits and licenses for conducting business operations andin a timely manner, and setting up signboards at train stations,comply with matters stipulated by various business laws andwith the aim of fostering a feeling of familiarity with our company

regulations.

widely among the public.

maintenance and improvement of the health and comfort of thepeople in the buildings

Promoting Future Growth Businesses

Collaborating and Cooperating with Business Partners during and after Disasters

Hulic views social issues as business opportunities. We work

society, in addition to businesses related to senior citizens, tourism,

In the event of a disaster, we have introduced an Internet- based

We concluded contingency agreements with the construction

together with stakeholders to resolve them and to realize theand the environment, we are engaged in agribusiness, children’ssafety confirmation system for swift confirmation of the state andcompany of building concerning restoration and recovery, enabling

creation of new value. As to be a Company that grows witheducation, and Bizflex (flexible office spaces).

to share information with building management companies.

collaboration and cooperation in the event of a disaster.
WEB

Hulic is working to improve indoor air environments and toindoor air improvement system that can be installed in ceilings,

promote the adoption of technologies from Shinshu Ceramics

which we have introduced in nursing homes we construct.

Co., Ltd., a company with unique technologies. HEPA filters

In addition, we jointly developed a small air purifier called

incorporating Shinshu Ceramics' proprietary earthplus™ material

earthmirage2 with a manufacturer that incorporates a HEPA filter

adsorb 99.9% of and decompose bacteria and virus particles

using earthplus™ material and started sales in 2021. As a measure

floating in indoor air. To prevent the spread of infectious diseases

against infectious diseases during face-to-face meetings, Hulic has

in facilities for seniors, we have combined HEPA filter units using

installed this small air purifier in conference rooms at the Hulic

earthplus™ material with humidifiers that optimally maintain

Headquarters and the Hulic Annex to ensure the safety and security

indoor humidity when using indoor heating. We developed a newof our customers.

Holding Regular Management Status Reporting Meetings with Property Management Companies
Hulic regularly holds property management status reporting

TOPICS
Hulic Ryogoku River Center received a Good DesignAward 2021 (issued by the Japan Institute of Design
Promotion)
Hulic Ryogoku River Center is a building complex that includes a hotel

Data

Introduction of an Indoor Air Quality Improvement System using Composite Ceramic Functional
Materials

3 future growth businesses (senior citizen-, tourism-, andenvironment- related businesses)
https://www.hulic.co.jp/en/business/index.html#anc3

under our own brand name, THE GATE HOTEL Ryogoku by HULIC, a waiting
area for boaters (Tokyo), the Ryogoku Child-Rearing Plaza (Sumida Ward),
and a cafe. This center, facing the Sumida River, is in an area with many
historical and cultural tourism sites, including the Ryogoku Kokugikan (sumostadium), the Japanese Sword Museum, and the Edo-Tokyo Museum. The

Exterior

center works with nearby tourist sites to promote the area’s attractions.

meetings with property management companies to check theExternal Evaluation

The center has a throughway, the Sumida River Gate, a highly regarded

implementation status of management work, including complying

connection between the previously separated waterfront and the town thatwith laws and regulations, and receive reports on various problems

helped the center win a Good Design Award 2021.

related to buildings, including the results of measures to fix defects
that have occurred in buildings. In this way, we are promoting themaintenance and improvement of quality, as well as unifying thequality of overall property management and operation services.

68

Hulic Co., Ltd. Sustainability Book 2022

Corporate Governance● Verification of specifications of facilities introduced and interior

Environmental Initiatives

We conduct an annual customer satisfaction survey for tenantsSocial Initiatives

Quality Evaluation for Management Companies

Customer Satisfaction Survey

Our Approach to Sustainability

Social Initiatives

Management status reporting meeting with property
management companies

Terrace on the 9th floor of the hotel

Hulic Co., Ltd. Sustainability Book 2022

69

Fair Trades with Outsourced Contractors

procurement and purchasing to further develop our sustainability initiatives. In addition, we promote sustainability activities across the entire
value chain by applying this policy to business partners as well.
1.We will comply with laws, regulations and social norms,⑥Reduction of excessive working hours

and undertake business activities based on a set of

In addition to ensuring compliance with labor-management

corporate ethics.

agreements, including the 36 Agreement and laws and2.We will respect the fundamental human rights of all

regulations of relevant countries and regions, we adopt basic

Considering long-term business relationships with outsourced

outsourcing management, respecting related laws and regulations

people.

contractors, we work to ensure fair trade with them as a partner on

as well as guidances from administrative organizations. We select①Prohibition of discrimination

an equal footing. Regarding outsourcing by the real estate businessan outsourcing contractor that is most appropriate for each project

We prohibit any discrimination against any person on

In accordance with laws and regulations of relevant countries

division, we ensure fair trade based on the rules for real estateby checking track record and abilities to execute operations.

the ground of his or her belief, religion, age, sex, sexualand regions, including the Labor Standards Act, we endeavororientation, race, nationality, origin, physical or mental

to offer a workplace where workers can work healthily anddisability, etc.

safely.

Cooperation with Building Management Companies②Prohibition of harassment

Hulic Building Management Co., Ltd. inspects and evaluates
management conditions once a year based on the rules for real

WEB

Initiatives for Providing Healthy and Comfortable Spaces
https://www.hulic.co.jp/en/sustainability/social/customers/#anc2

estate outsourcing management and and makes a round to provides

We prohibit any act, including sexual harassment or abuse

Educational Activities through Compliance Training⑧Payment of wages over minimum wage
We pay wages over minimum wages prescribed in various local

of authority, to inflict emotional distress on any person bylaws and regulations as well as the Minimum Wage Act.

language or behavior that damages his or her character or

3.We will take consideration of environmental conservation

dignity.

guidance to each company based on the assessment results.

policies to reduce overtime work and limit excessive work.
⑦Securing of health and safety of workers

and will strive to promote green procurement.

③Prohibition of child labor

We will endeavor to conduct procurement in accordance

We prohibit any child labor.

with the Hulic Green Procurement Policy in order to realize④Prohibition of forced labora sustainable society.

Our compliance manual (the code of conduct) specifies businessAll employees are reminded through these efforts that providing

We prohibit any forced labor carried out through violent acts

entertainment/gift and prohibition of bribery. We implementbusiness entertainment or gifts for business partners in an improperor intimidation.

internal compliance training in a timely manner to raise awarenessmanner may impair appropriate business relationships and theamong our employees of rules such as prohibiting giving

soundness of business, and that such conducts violate our internalof collective bargaining

donations, offering business entertainment, and giving gifts torules and regulations and the compliance manual. Our employees

In line with international labor standards, we respect the right

6.We will strive to provide safety, peace of mind and highpublic servants or other interested parties. Furthermore, twice aare encouraged to report directly to the compliance hotline whenof freedom of association and right of collective bargaining.

quality.

year, our Legal & Compliance Department monitors whether eachthey notice any problematic doings including violation of laws or

department properly manages the entertainment of interested

code of conduct.

parties and the acceptance or offering of gifts or other articles.

Framework for Collaboration and Cooperation with Business Partners⑤Respect for the right of freedom of association and right

4.We will build an information management system andmanage information appropriately.
5.We will carry out fair and equitable business transactions
and build trusting relationships with business partners.

Initiatives for PPP project
Hulic promotes the creation of social and economic values throughabundant development track record and a stable business base as

Public Private Partnership (PPP) projects from the viewpoint of not

one of the leading companies of PPP projects. Taking into accountonly real the estate business but also addressing social needs andchallenges and needs of administrative agencies and communities[Framework for collaboration cooperation with building[Framework for collaboration and cooperation withchallenges.

through exchanges of information with them, we aim to contribute

management companies]

construction companies]

PPP projects intend to efficiently utilize and operate real estate

to the regional economy by realizing business to improve the value● The emergency contact network for emergencies during night

We have concluded contingency agreements with major

owned by national or local governments (public real estate)of public real estate through collaboration between the public andtime or on holidays has been established between Hulic andconstruction companies under which they agree to cooperate

through collaboration and cooperation between the public andprivate sectors by settling the issues of the communities.

building management companies. With this network, weto assess destruction status and damages of Hulic’s buildings

private sectors. We are actively engaged in PPP projects by utilizing

maintain a framework for responding promptly to emergencies.

immediately following a large-scale disaster, and offer full● We have introduced a safety confirmation system with realestate management companies through the Internet for swiftlyWEB

PPP project
https://www.hulic.co.jp/en/business/other/develop/#anc1

putting the highest priority on ensuring safety.

Cooperative Structure with Business Partners
External Evaluation

sharing information and verifying the extent of damage.

cooperation for the restoration and recovery of our buildings while

Environmental Initiatives《Results in FY2021》 Evaluated the status of work implementation of outsourced property management companies

Hulic actively engages in sustainability activities as a company involved in the real estate industry. We have formulated a policy on

Social Initiatives

We aim for close mutual communication with our business partners, and build relationshipsthat mutually enhance the corporate value of both parties. Additionally, Hulic strives to createshared value with stakeholders by resolving various social issues through PPP business.

Corporate GovernanceFundamental
Approach

CSR Procurement Policy

Data

Collaboration with Business Partners

Our Approach to Sustainability

Social Initiatives

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71

Initiatives for Employees

Promoting Internal Communication / Sharing Corporate Philosophy
Hulic has a small workforce, which enables a distinctively close

management and employees, making it easy to communicate

Human Capital Management

distance between each employee, as well as between top

within the Company.

Specific methods for communication include:●C areer Development Interviews●P resident's Message

The president communicates in a message sent out to all
employees every month to share company-wide developments

Initiatives to Create a Highly Productive Organization

and underlining philosophy.
Social gatherings with the president are held twice a month forapprox. 10 employees less than the age of 45.
●P resident Survey

estate appraisers, lawyers, certified accountant and others.

one of our strengths. Our Ordinary Income per employee is over

In order to create a highly productive organization, we place

We conduct a survey twice a year that allows all employees to

JPY500 million. We believe that this figure reflected our status aspriority to unbiased talent acquisition, enhance next-generation

share their thoughts directly with the president.The President

top-notch among the listed companies in Japan boasting excellent

nurturing support systems and welfare programs, embrace diversity

provides responses to the various opinions delivered byproductivity. To ensure we remain a group of professionals, weand work style reform, and advance health and productivity

employees who completed the online questionnaires.

place particular emphasis on human resources development. We

management in addition to talent development.

Information from questionnaires on various businesses andhave been encouraging employees to obtain qualifications, andin-house systems have been incorporated into management

the list of our professional staff included first-class architects, realdecision-making.

Improving Talent Development Programs
Overview of Talent Development Programs

performance.
● Infomation is provided on the Company intranet, as needed.

●T op Seminar

Hulic is made up of a small group of elite professionals and this is

Initiatives to Create a Small Group of Elite Professionals

to confirm their goals and expected roles, and to evaluate

Environmental Initiatives《Results in FY2021》 ●Number of additionally obtained qualifications by employees in total：38

Supervisors regularly conduct interviews with employees

Survey of Participant Satisfaction with Internal Training Programs
We are conducting a survey of participants in English conversationa five-point scale and to provide feedback on suggestions forclasses and new graduates to improve the content of our training.

improvement. We are also working to improve the content of thebe approached with a long-term perspective in a planned manner.

At the end of each training session, participants are asked totraining based on the opinions of the participants gathered.

The managers and the Company establish a system for tacklingrate the content of the training and instructor satisfaction on

Hulic considers talent development to be a top priority that should

this issue and strongly support employees in their efforts in further
developing skill-sets and gaining qualifications by sharing theProviding Internship Programcommon view on professional development.
In addition, we are creating motivating work environment to

We provide an internship program for undergraduate and graduate

our identity through acquiring knowledge of real estate developer’s

employees to boost motivation including posting new hires tostudents at the Head Office Building (or online), intended for

affairs and verifying projects. Approximately 70 students

on-the-job training and providing employees with opportunities

understanding of the real estate industry. We offer a program

participated in FY2021.

so that they can constantly develop new business ideas and takewhere the participants can learn about the real estate business andSocial Initiatives

We aim to create robust and highly productive organization through talent development andmanagement.

Corporate GovernanceFundamental
Approach

Our Approach to Sustainability

Social Initiatives

on challenges. We have introduced an “elective training” systemthat allows employees in their second to third years to select what

Data

training to take from FY2021.

Providing High Level of Fringe Benefits
Since Hulic maintains a small workforce of elite professionals, weback to employees drives further growth for the Company in what

believe that it is important to give back to stakeholders, including

we see as a positive cycle.

External Evaluation

employees, as the Company grows. This commitment to giving

72

Hulic Co., Ltd. Sustainability Book 2022

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Social Initiatives

employees can easily take paid time-offs and to avoid long work hours.

Details• Possible to take leave until a child becomes 4 years old.

Special childcare leave/
Childcare leave• In case of taking a short-term childcare leave, it is possible to use the first month as a "paid special childcare leave".

Reduced working hours/
Limits on overtime work

• Employees who have reared a child in or younger than the third grade of elementary school can reduce work hours not

Exemption of overtimework• Employees who have reared a child in or younger than the third grade of elementary school can be exempt from overtime

Staggered work hours• Employees can ask to change the time that they start work (standard working hour starts at 9 am) to either 8 am or 10 am.

• A male employee who took a childcare leave once within 8 weeks after childbirth is allowed to take the leave again within

the period when childcare leave is still available.

《Results in FY2021》 Usage rate of paid leave: 81.5％*The figure marked with

Systemhas been assured by an independent assurance provider.

Initiatives for Striking a Work-life Balance
Hulic is pouring effort into enhancing our next-generation

Children, set targets for the development and thoroughnurturing support programs and a program ensuring a balance

notification, etc. of the work-life balance support system, and are

between work and nursing in the aim of supporting employees

conducting activities to these ends. In January 2021, we introduced

and their families. With regard to support for the next generation,a new hourly childcare and nursing care leave system. As a result of

Hulic aims to achieve a higher level than the legal standard andthese initiatives, over the past nine years (2013-2021), the ratio of

has established various systems in this regard. In addition, we

women returning to work following childcare leave has increased

are working to create employee-friendly environments where all

to 100%. Elsewhere, the turnover rate due to nursing care has

employees can make the most of their abilities. Accordingly, webeen maintained at 0% while the ratio of female managers has

have established an action plan in accordance with the Act on

doubled.

Advancement of Measures to Support Raising Next-Generation

Job-return system
Celebration money on
auspicious occasions(marriage, childbirth)Childcare Center Subsidy
Systemexceeding two hours per day in units of 30 minutes, if they wish.
work, if they wish.

• An employee who retired due to marriage, childbirth, childrearing, and nursing care, etc. can return to work under thesame working conditions as at the time of retirement.
• A special payment for marriage of 100,000 yen is given to employees regardless of their service years.
• A special payment for childbirth is given to employees: 100,000 yen for the first child, 200,000 yen for the second child,and 1,000,000 yen for the third child and thereafter.
• Subsidize part of the childcare center fee until a child enters elementary school. A monthly payment is up to 30,000 yen

for one child. (This amount applies not only to the first child, but also the second child and thereafter.)• Subsidy for extended daycare nursery hours.

Subsidy for costs associatedwith caring for a sick child• Up to 5,000 yen is paid per day per child, for a maximum of 5 days per month, until the child reaches the end of the third

Company daycare nursery
inside the Hulic head officebuilding• Hulic has established nursery facilities at its Head Office for employees. Both monthly and temporary childcare services areyear of elementary school.
available at the facilities.
• Employees using these services may drive to work and park their cars at the Head Office Building.
• When an employee use services of a babysitting business operator which has a corporate contract with Hulic Group, theSupport Raising Next-Generation Children Initiatives
Establishment of Hulic’s Onsite Childcare Nursery Facility
In 2014, we opened the Odenma Fureai Childcare Nursery insideneighboring residents, with

the Hulic Head Office Building to promote a more employee-

the intention of contributing

friendly work environment in which our employees can raise

to reducing the number ofchildren while working. To make this childcare nursery morechildren on nursery waiting

accessible, employees using this service are allowed to drive theirlists in the local community.

cars to work and park them in the Head Office Building’s parking
lot free of charge. In addition, this childcare nursery is not only
available for the employees but also for certain children* ofWEB* Conditions for use applied toneighboring children differ fromthose applied to employees.

Odenma Fureai Childcare Nursery website (in Japanese only)
https://www.hulic.co.jp/sustainability/social/employee/nursery/

Babysitter Program
Subsidy for the cost of Kids’
Club

Environmental Initiatives

them to strike a work-life balance. We take measures to facilitate environment where

entire enrollment fee of 21,000 yen, the annual fee of 10,500 yen, as well as the monthly fee up to 15,000 yen per childare subsidized, in addition to the provision of discount tickets and coupons.
• Up to 50,000 yen is paid per month for a child until the end of his/her third year of elementary school.

Social Initiatives

Fundamental
Approach

Details of Next Generation Nurturing Support Program• It is applicable during the period from when a female employee found out her pregnancy to when she takes maternity

Child care leave (Previous
nursing care leave wasincorporated in child careleave.)

leave in the case it is difficult to work due to pregnancy complications, etc.
• It is applicable when it is necessary for an employee (regardless of gender) to nurse a sick child younger than fourth graders

or to participate in the events of nursery school or elementary school.
• Child care leave is available for up to 10 days (in case of one child) or up to 15 days (in case of two children or more) a year

and can be taken in one-hour increments.
Work from home system• Possible to work from home for the purpose of childrearing or nursing care and this system can be used in full days or half days.

Leave for childbirth of spouse• Possible to take a day off in the case of childbirth of spouse (paid).

Next-Generation Support(Infertility Treatment)• Subsidizes 50% of treatment costs excluding subsidies from municipal governments or other sources.

Childcare mentor program• 10-day special leave (paid) can be taken for treatment in addition to paid leave in one-hour increments.
• With this program, support from human resources and other mentoring staff is available (for all employees) following

Corporate GovernanceIn order for employees to be healthy and fully exercise their abilities, we encourage

Our Approach to Sustainability

Work-life Balance -Creating a Motivating Work Environment-

pregnancy and childcare leave for one year after returning to work.

Diagram of Hulic's Next Generation Nurturing Support Program

TOPICS

raising the next generation at a distinctive

Raising Next-Generation Children, we have received Platinum

level. We also received Kurumin

Kurumin certification in 2020 from the Minister of Health,certification for the third time (in 2010,

Labour and Welfare as a Company that supports employees in2017 and 2020).

Diverse Work Styles
We are promoting the development of environments and systemsystems as part of our flexible response against the spread ofdesigns aimed at realizing diverse work systems so that each

COVID-19.

employee can make the most of his or her abilities. We had alreadyWe also launched a DX Project Team and started to consider

introduced a work from home system and staggered office hours

specific measures. We will take measures such as taking surveys

system for employees providing childcare and nursing care prior tofrom employees as needed on issues that come to light.

External Evaluation

Based on the Act on Advancement of Measures to Support

Data

Platinum Kurumin Certification

the pandemic, and after 2020, we expanded eligibility for these74

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75

Diverse Work Styles

Hulic Head Office Tour for Families● Work from home*● Staggered office hours

Every year since 2013, we have held the Hulic head office tour forfamily. In the tour conducted in 2022, employees served as a tour

● Online conferencing

our employees and their families. The purpose of the tour is to haveconductor to the onsite workplace, also explaining environmental* It was originally intended for employees providing childcare and nursing care, but we expanded eligibility in 2020 to help preventing the spread of COVID-19.

employees’ families understand the Company by providing themtechnologies installed in the Hulic Head Office Building. Afteran opportunity to visit the workplace. We also aim to promote

the tour, participants who wished had lunch at THE GATE HOTEL

creating comfortable workplaces which values families by having

TOKYO by HULIC.

Work Style Reform● Improving the Efficiency of Business Processes and Internal

the entire company rediscover that each employee has a cherishedWe encourage employees to take a half day off on Friday

We check the usage status of paid leave and implementation
status of No Overtime Day as appropriate, in addition to create

afternoon once a month.

Environmental Initiatives

Promotion● Implementation of “My Friday”

Our Approach to Sustainability

Social Initiatives● Introduction of staggered workdays

a holiday calendar for each employee, and hold discussions on

Employees (including managers) can start work one hour earlier

working style at each department. In addition to accurate timeor later if they want to.

management using system logs, etc., we work to reduce long
working hours and promote the systematic use of paid leave bymonitoring working hours, etc. through the Risk Management
Committee and internal promotion according to guidance andTour at our Head Office

At our Head Office Reception

remained high.
● Implementation of No Overtime Day

Supporting Employees in Striking Balance between Nursing Care and Work

Hulic helps prevent health problems due to overwork, including
by introducing “no overtime days” and encouraging employees

We provide various types of support for our employees to allow

workers is easily available to employees managing both work andthroughout the Company to go home early.

them to manage both work and nursing care when a family

nursing care. Furthermore, we have established the Regulations formember of the employee is in need of care. The time required for

Supporting the Combination of Nursing Care and Work.

nursing care and the degree of seriousness vary depending on

As part of these initiatives, the nursing care paid leave wasindividual cases. Therefore, we believe that improving environmentchanged in 2021 to enable paid time off in one-hour incrementsof the whole workplace is indispensable. Based on this notion,from the beginning of work hour and throughout the day until thewe raise awareness in the workplace so that support from the co-end of work hour.

● Promoting the Use of “Plus-one” Paid Leave and Consecutive

Paid Leave
Promoting the use of paid leave before and/or after Saturdays,
Sundays, or holidays, and the use of a three-day vacation and a* T he figure marked with “ ” has been assured by an independent assurance provider.
* The usage rate of paid leave is calculated by dividing the number of days of paid leaveused in the year by the number of days of paid leave granted in the year. The numberof days carried over in the year are excluded.

one-week vacation once a year respectively.

Efforts to Support the Security of Employees and their Families
There is nothing better than for all employees to be healthy

through the systems shown below. We wish that such preparations

every day. However, If something unexpected happens to one offor this possibility will lead to the creation of a secure andour employees, we will support the employee and his/her family

comfortable company for employees.

SystemSummary of Program to Support Employees in Striking Balance between Nursing Care and WorkSocial Initiatives

Participants exchange children’s name cards with
President Maeda

As a result of various initiatives, the usage rate of paid leave

Corporate Governanceadvice through the Health Committee.

Details• When an employee who died while in office or retired due to disability has children, and his/her unemployed spouse

who rears the children wants to work at Hulic Co., Ltd. or its group companies, the job opportunity is offered.
• When an employee who died while in office or retired due to a disability has children younger than 22 years old, a

Data

Support for the
bereaved, etc.

scholarship of 150,000 yen a month is paid per child. (According to the application for extension, it is possible to pay
for up to one year.)• When an employee dies or becomes disabled while in office, condolence money or a special solatium is paid to the

Condolencemoneybereaved family or the employee.
• In the case of a death, condolence money up to 10 million yen is paid.
• In the case of a disability, a special solatium equal to the amount of condolence money is paid. This payment is

Congratulatory
or condolence
payments
Special solatium
for injuries anddiseases

76

External Evaluationdifferent from condolence money according to the contents of the "accident compensation rules".
• If, while in office, an employee or his/her spouse, child, or parents dies, 20,000 yen - 200,000 yen is paid.
• If, while in office, a house in which an employee lives is damaged by natural or accidental disasters, 100,000 yen - 1

million yen is paid to an employee who owns his/her house, and 50,000 yen - 500,000 yen to an employee who does
not have his/her own house, depending on the scale of damage.
• When an employee, while in office, is hospitalized for five consecutive days or longer due to disease and injury froma freak accident, special solatium for hospitalization is paid for up to 120 days.
• When an employee dies while in office, condolence money of 100,000 yen is paid to a recipient designated by the* A family member who is in need of care is defined as a spouse, father/mother, child, spouse’s father/mother, grandfather/grandmother, brother/sister, or grandchild who requires constantnursing care for over two weeks due to a reason such as injury, disease, or physical or mental disorder.

employee in advance.

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Health and Productivity Management

Conducting Health Checkups that Exceed Legal Requirements· We implement an annual health checkup that is fully paid by the company and equivalent to a comprehensive medical examination, with a
The time required for each health checkup is regarded as working hours.
· 100% medical checkup rate is our target, which is continuously achieved. From 2018, new targets that 100% medical re-checkup rate andparticipation rate of specific health guidance were added.
Message from management to recommend the participation of such checkup and follow-up by HR member in charge of health《Results in FY2021》 ●Medical checkup rate on employees: 100％management were delivered.

has been assured by an independent assurance provider.

and provide health guidance for specific employees. In addition, consultation system about health issues is established.

Promoting Health and Productivity· As infection control measure, employees can take flu vaccination before epidemic, antibody test and vaccination of rubella.

Hulic formulated the Hulic Health Management Declaration described below to implement comprehensive health management.

Hulic Health Management Declaration
Hulic is creating a workplace environment that enables all employees to stay healthy and make the most of their abilities,
and aims to achieve sustainable growth by encouraging each employee to deliver high quality and value with professional
competence.
Based on this philosophy, Hulic regards maintaining and promoting the health of employees as a management issue, andimplements health management to remain “a highly productive organization,” while furthering measures it has taken for
promoting employees’ health.

Takaya Maeda

President, Representative Director
Hulic Co., Ltd.

TOPICS
2022 Certified Health & Productivity Management Outstanding Organization (Small and Medium-sizedEnterprises Category)

Mental Healthcare

Non-smoking Initiative

We implement mental health care in cooperation with medical

For health promotion and stopping passive smoking of employees,

institutions. We help employees, who are diagnozed as requiring

we implement enlightenment activities including complete

special medical examinations and treatment, find specialists or

separation of smoking area from non-smoking rooms, delivering

specialized medical institution partners. In 2016, we started tomessage from health insurance association and post a notice about

perform stress check tests on all employees to prevent them fromno smoking. From 2019, we started to bear full cost of smoking

suffering from mental disorders.

cessation clinics for employees who try to quit smoking andintroducing the non-smoking hours in the office. Furthermore, in

Percentage of employees who took stresscheck tests

2020, the range of no-smoking hour settings has been expanded.

2017

2018

2019

2020

2021

97.1%

95.7%

94.7%

94.7%

94.0%

Health Promotion Program
To improve health awareness, we installed both blood pressure

Complimentary breakfast, lunch and beverages(health-oriented diet)and body composition monitors in common areas, and we are

In order to publicize the importance of regular dietary intake, we

promoting employee health by providing partial subsidies for sports

support healthy food habits at cafeteria (providing healthy lunch

clubs and company-approved club activities. In 2019, we supported

and calorie display of food & drink menu) .

Hulic was certified as a Health & Productivity Management Outstanding

the health and wellness of our employees by participating in the

Organization in 2021 for the fourth consecutive year from 2019 in recognition

Corporate Games 2019 Futsal Tournament.

of our health and productivity management initiatives. The award has been

Health and Productivity Management Training

the Nippon Kenko Kaigi to advance health and productivity.

Hulic provides ongoing occupational safety and healthcare
promotion training to raise awareness of safety and health among
all employees In 2021, we conducted in-house training (by video)

The followings are Hulic’s major measures for maintaining and promoting employees’ health.

Health and Productivity Management Promotion System
Health and Productivity Management
Promotion Systemsafety. Our industrial doctor attends all Committee meetings toto improve health literacy.

・Attendance: Mandatory for managers or higher (however, allemployees can attend)
・Number of participants: 124 (the number of respondents toquestionnaires by managers or higher)
Data

promoted by the Ministry of Economy, Trade and Industry in conjunction with

Occupational Safety and Health
In promoting the creation of comfortable workplaces, we give

occupational safety and health in the workplace.

and The Health and Productivity Management Follow-up Meeting

first priority to the securing of safety and health and endeavor to

Further, no fatal accidents have occurred in the past three years

members discuss the status of use of paid leave and overtime

secure employees' health and safety by engaging in various efforts.

among contractors or at other companies involved in our real

work of employees, and the matters discussed by the Committee

While we have not obtained certifications such as OHSAS 18001,

estate development. No employees are engaged in work with aare reported to the board members. The matters are utilized for

we secure occupational safety under our own system by regularlyhigh risk for illness and no legal proceedings have been brought

President is a chief executive in charge of health management, HR

improving internal systems and goal setting. Also, important

conducting risk assessment and improving issues.

against us in this regard.

manager and general manager of each department are designatedmatters reported to the Health Committee such as the status of

We will continuously promote the improvement of the level ofas a leader in health promoted activity.

use of paid leave, overtime work of employee and status of taking

The Health Committee and The Health and Productivity

medical checkups are reported to the Risk Management Committee

Management Follow-up Meeting, which consist of the HR manager

which is headed by the president and the Risk Management

and the members elected from among employees every year, holdCommittee will discuss the matters.

External Evaluation

provide advice and guidance on healthcare. The Health Committee

・Health Committee
・Health and Productivity Management Follow-up Meeting

Environmental Initiatives· In order to promote health management of employees, occupational health physician looks through the results of all employees, interview

Social Initiatives* The figure marked withwide lineup of optional examinations such as neck ultrasonography, colonoscopies, and gynecological checkups.

Corporate GovernanceFundamental
Approach

Based on the philosophy that employees’ good health is essential for improving the
productivity and growth of the company, Hulic is promoting the creation of employee-friendly
work environments in which employees can continue to work with enthusiasm and energy ingood health.

Our Approach to Sustainability

Social Initiatives

monthly meetings in principle to promote employees’ health and78

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The Company has established the Hulic Human Rights Policy,of Human Rights, as well as human rights related to equal

We aim to foster a workplace in which all employees can make the best use of their

which proclaims respect for human rights so that all employees

employment, prohibition of forced labor and child labor, freedom

can maximize their abilities and contribute to the realization ofof association, and collective bargaining stipulated in the ILO's

a society full of peace of mind and trust. In our Human Rights

international labor standards.

Policy, we declare that we prohibit any acts of discrimination and

In FY2020, Hulic conducted compliance training on themes

harassment, as well as any discrimination against any person on thesuch as preventing power harassment to raise awareness andground of his or her beliefs, religion, age, sex, sexual orientation,

understanding throughout the Group. Instruction on power

race, nationality, origin, physical or mental disorder, etc. We also

harassment was also given to officers and general managers at

prohibit any act, including sexual harassment or abuse of authority,

Hulic as part of compliance training. In FY2021, we used ourto inflict emotional distress on any person through language orintranet to share information for all Group companies on the Hulic

abilities.
 Ratio of female managers: 22.4%《Results in FY2021》●●Number of seminars provided by the Diversity Promotion Project Team: 1time●Employment ratio of persons with disabilities: 7.38 % (Hulic) 2.54 % (Hulic and its Group companies)* Figures marked withhas been assured by an independent assurance provider.

Diversity: Message from the President

behavior that damages his or her character or dignity. Respect for

Human Rights Policy as well as on themes such as LGBT lifestyles

Ever since being listed on the First Section of the Tokyo Stock

work breaks, and taking part in family tours at our head office. I

human rights encompasses all fundamental human rights found inand harassment.

Exchange, Hulic has consistently recorded all-time high profits.

myself also visit Suginami Office each year to exchange opinions

the Constitution, Labor Standards Act, and Universal Declaration*LGBT is a collective acronym for lesbian, gay, bisexual, and transgender.

Now that a decline in the working population is unavoidable, wewith everyone in the office.

believe it is essential for diverse human assets to reach their full

We believe that it is essential for management to disseminate

potential in order for Hulic to continue plotting and achieving its

information actively so that Hulic employees work together tostory of steady growth into the future.

promote these initiatives. We communicate the importance ofTo this end, based on a commitment to diversity and inclusion, ourdiversity management through the dissemination of the Message

We prohibit any discrimination against any person on

and right of collective bargaining

only job grades are career-track positions to enable our employees

from the President once a month, the implementation of thethe ground of his or her belief, religion, age, sex, sexual

In line with international labor standards, we respect theto work without any gender distinctions, and our new graduate

President’s Questionnaire Survey every six months, and periodic

orientation, race, nationality, origin, physical or mental

right of freedom of association and right of collective

recruitment is now almost half male and half female. Nevertheless,dinner meetings with employees. We are raising internal awarenessdisability, etc.

bargaining.

sometimes employees need to leave their jobs for a certain period

in collaboration with the diversity promotion project team launchedof time due to life events and sometimes they struggle to balancein 2010 under the direct supervision of the President.

The Hulic Human Rights Policy① Prohibition of discrimination② Prohibition of harassment⑤ Respect for the right of freedom of association⑥ Reduction of excessive working hours

Our employees will work together to achieve diversity andWe prohibit any act, including sexual harassment or abuse

In addition to ensuring compliance with labor-management

inclusion, without any complacency about efforts to date.

of authority, to inflict emotional distress on any person byagreements, including the 36 Agreement and laws andnursery facilities located in our office and childcare leave so that

language or behavior that damages his or her character or

regulations of relevant countries and regions, we adopt basic

this struggle does not form a barrier.

dignity.

policies to reduce overtime work and limit excessive work.

work and home life when they return to their jobs. Hulic has
focused efforts on improving the systems such as establishing

As a result of these efforts, we achieved the target of increasing
the ratio of female managers to 20% by the year 2020, which was
the target of First Action Plan Based on the Act on Promotion of
Women’s Participation and Advancement in the Workplace,one

Environmental Initiatives

We respect human rights and proactively take advantage of diversity in our business.

③ Prohibition of child labor⑦ Securing of health and safety of workers

We prohibit any child labor.

In accordance with laws and regulations of relevant countries④ Prohibition of forced labor

and regions, including the Labor Standards Act, we endeavor

year ahead of schedule.

We prohibit any forced labor carried out through violent acts

We also make active efforts aimed at career development foror intimidation.

to offer a workplace where workers can work healthily andSocial Initiatives

Fundamental
Approach

Respect for Human Rights

Corporate GovernanceEmbracing Diversity & Inclusion and Respect for Human Rights

Our Approach to Sustainability

Social Initiatives

safely.

⑧ Payment of wages over minimum wage

women and we have been enhancing the training and follow up
required to achieve the new target of increasing the ratio of female

We pay wages over minimum wages prescribed in various

managers to 25% by 2024 and 30% by 2029 every year.

local laws and regulations as well as the Minimum Wage Act.
Data

We also put efforts into employment for persons with severe
disabilities, who have limited employment opportunities. We have
Hulic Ogikubo Building, where persons with disabilities carry out

Execution of Diversity Management

operations as our employees.

Hulic's basic approach is for the employees to be aligned with theirwork-life balance and career development. In addition, meetings

With an emphasis on supporting independence, activities include

skill-sets, aptitudes, and personalities that enables individuals toare held once a year with the President, who is responsible forworking steadily from 9:15 – 16:15, learning how to use PCs inperform at a maximum level and as a result of that the Company

the team, providing an opportunity for employees to directly

to operate a high value-added business with smaller workforce. To

communicate their thoughts and opinions.

achieve this, we believe that it is essential to raise awareness on

In 2021, the Diversity Promotion Project Team hosted a lecture

diversity & inclusion and enhance related frameworks. In 2010, we

meeting on unconscious bias, apart from holding discussion

established the Diversity Promotion Project Team, which continues

meetings on unconscious bias and other topics.

to engage in regular activities based on such themes as improving

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External Evaluation

established the Hulic Suginami Office, a dedicated work space at81

Establishing Good Labor-Management Relations

Hulic promotes diversity management because we believe diversity

cooperation with the Cabinet Office, Keidanren and the Ministry of

Our Code of Conduct and Hulic Human Rights Policy stipulate

directly with the President, in an effort to establish good laboris essential for providing opportunities regardless of gender, and

Education, Culture, Sports, Science and Technology, but in 2020・

respect for human rights in association with equal employment

management relations.

to this end, we are strengthening efforts to develop careers for

2021, to help prevent the spread of COVID-19, the event was

opportunities, freedom of association, and collective bargaining.

A range of opinions and requests were received from employees

women in particular. The Diversity Promotion Project Team has

cancelled. Hulic has set target ratios of female managers with thewe conduct interviews between employees and their supervisors

in response to the President’s questionnaire survey and we are

been conducting activities regularly since 2010. In 2016, we

aim of becoming a company in which women take on active roles.

when necessary and carry out the President Questionnaire Survey,

working on ways to provide a more comfortable workplace,received the highest certification as an “Eruboshi” company under

We provide follow-up trainings to all employees to raise awarenessthrough which employees can share their views and opinions

including installing a bicycle parking lot at the head office.

the Act on Promotion of Women's Participation and Advancementof our approach. In FY2021, the ratio of female managers

in the Workplace.

was 22.4%, going forward, we will promote initiatives toward

In 2019, we also engaged in activities with a focus on organizing

achieving new goals: 25% female managers by 2024 and 30% by

the “Science and Engineering Challenge (Riko-challe)” events in

2029.

The Hulic Human Rights Policy prescribes that we pay wages

companies for the fiscal year ended April 2021 - March 2022 andover minimum wage prescribed in various applicable laws andthe same of JPY6,746,000* in the real estate industry for the same

Formulation of Action Plan Based on the Act on Promotion of Women’s Participation andAdvancement in the Workplace (2nd period)

regulations as well as the Minimum Wage Act.

period. In this way, we provide employees with compensation that

The average annual salary in 2021 was JPY18,032,877 (including

exceeds their living wages, which is competitive when comparedThis Action Plan was formulated in order to enable female employees to strike a balance between their careers and child-raising, and to allow

bonuses and nonstandard wages). This was significantly higher

with the domestic and industry labor markets.

them to exert their capabilities and develop their careers in various divisions of the company.

than the average annual salary of JPY6,055,000* at 3,213 listed* Source: TOKYO SHOKO RESEARCH, LTD.

September 1, 2019 – December 31, 2023

Quantitative Goals

Target 1：To achieve a ratio of female managers of 20% or higher
Target 2：Have at least three women assigned as heads of departments.
Target 3：Have 100% of eligible female employees and at least one eligible male employee take childcare leaveby making it easier to use the system.

The Company is active on employment of persons with severe
disabilities who have limited employment opportunities. We
established the Hulic Suginami Office as a dedicated workplace● Career guidance and skills training will be provided to groom women for positions as heads of departments.

where nine employees with disabilities (eleven on

employees.
● Measures will be promoted among managers for raising awareness of diversity management.

with experience in guidance and nurturing work

● To encourage their use, the availability of work-life balance systems will be made more widely known among* The figure marked with “ ” has been assured by an independent assurance provider.
The Data covers Hulic Co., Ltd. and subsidiary companies that have been certified as
special subsidiary companies under the Act on Employment Promotion etc. of Persons
with Disabilities.

Social Initiatives

Initiatives

Promoting Employment of Persons with Disabilities

a Group basis, as of June 2021) and supervisors
mainly on sending direct mail, etc. As of June
2021, the employment ratio of persons withdisabilities was 2.54%

In FY2016, Hulic affirmed the Declaration on action by a group of male leaders who will create a Society in which
women shine and received the highest-level “Eruboshi” certification from the Minister of Health, Labour andWelfare as an excellent company taking initiatives to promote women’s participation and advancement in theworkplace.

Employment of Diverse Human Resources

7.38%

on a Group basis andon a non-consolidated basis.*
The Hulic Suginami Office

Employment System for Seniors
We have introduced a reemployment program for seniors ininterchange with younger employees. In addition, in order to get aaccordance with the Act on Stabilization of Employment of Elderly

head start on compliance with the Amended Act on Stabilization

Persons. Under this program, we rehire any employee that hasof Employment of Elderly Persons, which came into effect in April

Participating in the joint declaration on the charter of corporate

employees hired in 2021 (the total number of new graduates andreached the retirement age but who wishes to continue working

2021, we established a new system in January 2021 that provides

ethics concerning employment issued by Keidanren (Japan Businessmid-career talent acquisitions) was 23 (males: 18; females: 5); theuntil the age of 65. We offer staggered commuting and half-

opportunities for motivated and capable employees between

Federation), we proactively employ new graduates in accordance

proportion of women was 21.7%. The ratio of female managers

day leave for rehired employees and have facilitated environment

the ages of 65 and 70 to work at our company (a “specified

with the purpose of the charter. When performing pre-employment

has increased—reaching 22.4% in 2021—as a result of hard work

comparable to active employees with leave and absence systems.

commission” system that extends the continued employment

screening, we respect the basic human rights of applicants andto promote female employee empowerment in the workplace

We expect abundant knowledge and expertise that the senior

period to 70 years old).

make efforts to secure diverse human resources based on theirthrough further expanding system to support the development of

rehires possess to be inherited through communication andaptitudes and abilities, regardless of backgrounds such as race,

the next generation.

religion, or nationality, and regardless of gender. The number of

Job Return System
Hulic has instituted a job return system that allows employees

to support a balance between work and childcare as advocated in

who left the Company due to marriage, giving birth, childcare,

the Act on Advancement of Measures to Support Raising the Next

caring for a family member, or other unavoidable reasons, toGeneration and to secure human resources that have wide-ranging

return to their same job within a five year period with the same

experience and a depth of professional knowledge.

compensation and benefits as before. The purpose of this system is82

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Corporate GovernanceDuration of the Plan

Environmental Initiatives

Efforts Regarding Compensation

External Evaluation

Promoting Female Empowerment

Our Approach to Sustainability

Social Initiatives

83Social Initiatives

Social Contribution as a Company
We value environmental aspects such as environmental consideration and social aspects such asbuilding good relationships with our stakeholders in addition to the economic aspects of earning
profits and growing as a company. We work to resolve social challenges and make contribution
to the sustainable development of society.

We endeavor to prevent violation of laws related to labor andBoard of Directors is also regularly kept aware of the content

occurrence of accidents. Although risks of child labor and forcedof these reports. As a result, there have been no situations thatlabor are low at Hulic as we have developed a highly specialized

threaten such risks as freedom of association, collective bargaining

business mainly in Tokyo, we declare that we do not permit

rights, child labor, forced labor, security practices, or indigenous

any form of child labor or forced labor. In order to prevent suchrights.

labor, we regularly audit compliance with laws in employment

Recently, as part of compliance training for all employees, we held

management and also provide compliance education, including

training sessions on preventing power harassment. We also invitedregarding the prevention of child labor and forced labor, toan outside lecturer and provided training for preventing the abuse

employees.

of power for officers and general department managers. For all

Hulic actively and broadly engages in・ Actively engage in activities with particular emphasis on the three major fields of global

For managing human risk, the department in charge determines

Group companies, using our intranet we distributed information

various social contribution activities

environment protection, sharing value with local communities, and responses to socialand evaluates the situation before reporting to the Riskon the Hulic Human Rights Policy and posted information on suchincluding but not limited to our business

Management Committee and making recommendations. The

themes as LGBT lifestyles and harassment.

fields as a good corporate citizen. Through・ Strongly support social contribution activities of employees.

these activities we wish to contribute to・ Place an emphasis on securing transparency in implementing activities and facilitate

Fundamental
Approach

Policy for Social Contribution Activities
Basic Philosophy

Activity Guidelines

needs.

the sustainable development of the entire

communications and cooperation with the society.

Environmental Initiatives

Management of Risks regarding Labor and Human Rights Issues

Our Approach to Sustainability

Initiatives for Local Communities

society.

our businesses.

Support of the Japan Business Federation’s One Percent Club Initiative
The One Percent Club, as a sub-organization of KEIDANREN’s Committee on Responsible Business Conduct & SDGs Promotion, provides
information on social contribution activities to companies and coordinates networking with NPOs and other organizations with the aim

Social Initiatives

In line with this Basic Philosophy and Policy for Activities, we make social contributions that provide support in areas that are compatible withof enabling more effective social responsibility activities.According to this purpose, Hulic is committing to spend at least one percent of

List of Social Contribution Activities● Afforestation

Support of Culture and the Arts
● Sponsorship of the Hulic Cup Hakurei
Championships and Women's Rankdeciding Shogi Competition● Donated to Keidanren Nature Conservation● Supported Kishikai Shogi Festival (GreatSocial Welfare● Hulic Scholarship Program for training of

welfare caretakers● Supported orphans of cancer andchildhood cancer patients and their families● Employee Match Gift Program● Supported Single-parent Households

East Japan earthquake reconstruction
support event)Championships● Supported Kishikai Christmas Festival● Special Sponsorship of Minister of

Education, Culture, Sports, Science andTechnology Cup Elementary and JuniorHigh School Shogi Team Competition● Relocation of Shogi Hall

● Donated Used Postal Stamps● Supported New National Theatre Tokyo● Supported Japan Service Dog Association● Supported Naruto Sumo Stable Supporters’● Sponsorship of Kodomono Tame no Shiba-

Kikin charity concert for children

Association
Health, Medicine and Sports● Support for Japan Para-Badminton
Federation● Support for All Japan Private High School

Volleyball Federation● Support for the Japan Professional Tennis

Association

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Hulic Co., Ltd. Sustainability Book 2022

portable shrine● Donating Books to a Nearby Elementary

School● Special Sponsorship of the Hulic Cup Kisei● Donated to Japanese Red Cross Society● Donated Emergency Food Stockpiles● Hosting Summer Festivals/Donated a

Education and Social Education● Supported Scholarship Program of Kyoto

University● Supported AgriFuture Japan● Supported agricultural engineers

Data

Fund

Connection with the Local Communities● Opened Onsite Childcare Nursery Facilities
to Local Community Members● Supported Nezu Foundation

Academic and Research Support● Organized an Idea Competition forStudents● Supporting Environmental Studies at Kyoto

University
Others● Sponsorship of Mainichi Shimbun inFukushima relief efforts● Subsidized the Cost of employees’ Disaster

Recovery Activities● Donated to Ashinaga Scholarship

Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

Global Environment Protection● Organized Wooden Architecture
Symposium

Corporate GovernanceOrdinary Income to social causes each year.

85

Contributions and Community Investments in Registered NPOs
Hulic makes contributions to authorized NPOs. In FY2021, we made the following contributions.

Establishment of Hulic Scholarship Program for Training of Welfare Caretakers
We established the Hulic Scholarship Program for Training of
Welfare Caretakers in 2017 in order to support students aiming

Result of Social Donation Activities in FY2021

to be welfare caretakers, and develop human resources engaging
in nursing care for the elderly and thus contributing to resolution

Amount (JPY)

Single Mothers Forum (SMF, an approved specified NPO)

10,000,000

The Japanese Red Cross Society (a specified juridical person)

6,000,000

Kiko Network, an NPO who acts to prevent global warming

1,800,000

Keidanren Nature Conservation Fund (a public trust)

1,000,000

Total

18,800,000

of social issues related to the advancing aging society. This is anonrepayable (free) scholarship that aims for an improvement oflabor shortage in nursing care.
We have doubled the number of scholarship students from 2020.

Practical training

Scholarship granting ceremony

Donation to the Tokyo branch of Japanese Red Cross Society

Organized Wooden Architecture Symposium 2019
Hulic makes wooden constructions as a business. In addition, we

helping to reduce CO2 emissions and protect forests as part of ourheld the Wooden Architecture Symposium 2019 with the aim ofsocial contribution activities.

raising awareness on the possibilities of wooden buildings andWe make donations to the Japanese Red Cross Society, an

to donations from the Company, those employees and executive

organization that responds to disasters through a wide range of

officers electing to participate also donate a fixed amount every

activities in Japan. In 2021, JPY6 million was donated. In addition

month.

Donation of Used Postal Stamps for Support Activities in Developing Countries

Keynote speech

Kengo Kuma (Architect・Professor at The University of Tokyo)

Panelists

Kengo Kuma (Architect・Professor at The University of Tokyo)
Shuzo Sumi (Senior Executive Advisor, Tokio Marine & Nichido
Fire Insurance Co., Ltd.)
Tadao Kamei (President and CEO, Nikken Sekkei Ltd.)
Masahiro Miyashita (Chairman of the Board, Takenaka
Corporation)

Coordinator

Atsuko Fukushima (Journalist)

and has set up stamp collection boxes at Group company locations.
We donate these stamps every year. We donate these stamps every
year. In 2022, we donated approximately 1,300 grams of usedstamps that we collected during the year to the Japan Committee,
Vaccines for the World's Children, a certified NPO. Every year, we

Sorting of used stamps by thesustainability supporters

collect a large volume of used stamps, and we sort them with thecooperation of our sustainability supporters. It takes almost twohours. After converting the stamps into money, JOICFP applies it

Corporate Governance

Theme

Social Initiatives

The Hulic Group generates a large number of used postage stamps
Future of cities made of wooden structures
Aiming to increase demands for timber in urban areas
Challenge of timber for medium- and high-rise buildings

Environmental Initiatives

Organization name

Our Approach to Sustainability

Social Initiatives

to activities that they promote in developing countries to protect
the life and health of pregnant women and women in general. The
Note: Occupation, affiliation, title, etc., when symposium was held.

money exchanged from the stamps is used to support vaccines forchildren in supporting countries, mainly in Southeast Asia.

Afforestation
Hulic outsources logging, planting, and weeding activities toyears, we will continue cutting undergrowth so that the planted

forestry cooperatives in an effort to plant the same amount of trees

cedar saplings will grow healthy.

Support for Japan Service Dog Associationof assistance dog (specifically for the physically disabled) just likeas the standing trees used as building materials for construction.

the Japan Service Dog Association, to increase support for people

guide dogs and hearing dogs. A major issue, however, is that there

Approximately 300 m3 of lumber is used in the construction ofwith disabilities, one of the focuses of our social contribution

are very few working service dogs in Japan, while awareness ofa fireproof wooden construction (hybrid structure combining

activities. One aim of the Japan Service Dog Association is to help

their existence is extremely low,

wooden and steel frame construction) commercial facility (HULIC

build a society that is kind and enjoyable for both people andeven among disabled people.

&New GINZA 8) which completed in October 2021. At the same

animals. Based on this philosophy, the organization (1) raises top-

Also, it is both expensive andtime, approximately 12,000 cedar saplings were planted (newquality service dogs; (2) develops trainers; (3) collaborates with local

time consuming to train aplantings) across an area of about 4.3 hectares. Over the next fiverehabilitation centers and organizations for disabled people, anddisabled people together with aprovides consultations and information on using service dogs; andservice dog, which is why Hulic(4) raises awareness of service dogs to encourage independence

hopes to make a difference byand social participation of disabled people. A service dog is a typelending support.

Donated to the Keidanren Nature Conservation Fund
Hulic values activities that seek to conserve nature and biodiversity.

preserving Japan’s natural environment and projects related to

We have been donating to the Keidanren Nature Conservation

sustainability.

External Evaluation

Cedar sapling newly planted and a mountain where they were planted (Fukushima Prefecture)

Data

Since 2022, Hulic has been supporting a social welfare organization,

Fund every year since 2012. The funds we donate are used for
projects by private non-profit organizations, including someoverseas. These projects work to conserve the natural environment
in developing regions, mainly in the Asia-Pacific area, as well as

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87

Donation of Emergency Food Stockpiles

Our Approach to Sustainability

Social Initiatives

Special Sponsorship of the Hulic Cup Kisei Championships

In the course of inspecting and replacing the emergency foodwill continue to donate ourSince April 2018, Hulic has been a special sponsor of the Kisei

stockpile at our headquarters building, we donated foodemergency food stockpiles

Championships (organized by the Japan Shogi Association andapproaching its expiration date, previously disposed of as waste, toin the future.

Sankei Shimbun Co., Ltd.) The Kisei Championship is an official
championship with a history, established in 1962. Players compete

Second Harvest Japan, an authorized nonprofit organization. We

for the title of “Kisei.”Support for Orphans of Cancer and Childhood Cancer Patients and Their Families
Aflac Parents Houses initiatives promoted by the association. In

Association of Agencies, which is a network of medical and life

addition, we have donated to the Gold Ribbon Network, an NPO

insurance agencies. We donate to the Aflac Scholarship Fund forthat supports children with cancer.

Childhood Cancer Survivors and Children of Cancer Victims andSpecial Sponsorship of Minister of Education, Culture, Sports, Science and Technology Cup
Elementary and Junior High School Shogi Team Competition
Since 2017, Hulic has been a special sponsor of the Minister of
Education, Culture, Sports, Science and Technology Cup Elementary

Aflac Parents Houses
These general support centers help reduce the economic and emotional burden of pediatric patients and their families as they take onchildhood cancer and other serious diseases with long-term hospitalization or outpatient care at specialist hospitals in urban areas.
Gold Ribbon Network
Gold Ribbon Network is a non-profit organization dedicated to three key areas: supporting children with cancer to raise their qualityof life; supporting research and development to increase the survival rate of children with cancer; and providing information andpromoting understanding of childhood cancer.

Support for Single-parent Households

and Junior High School Shogi Team Competition (organized by
the Japan Shogi Association and Sankei Shimbun Co., Ltd.). This
competition is for teams of three students belonging to the sameelementary or junior high school, and the trophy and letter ofSocial Initiatives

Aflac Scholarship Fund for Childhood Cancer Survivors and Children of Cancer Victims
This scholarship program is for high school students whose opportunities for pursuing a higher education have narrowed due to losing
their household’s main provider to cancer. Up to now, more than 3,000 students have received scholarships, and the total amountawarded exceeds JPY1.9 billion (as of June 30, 2021).

commendation presented to the winning team by the Ministerof Education, Culture, Sports, Science and Technology give thecompetition significant prestige.

Support for Kishikai Shogi Festival (Great East Japan Earthquake Reconstruction Support Event)
We sponsor the Kishikai Shogi Festival as part of our support forIn 2019, we sponsored the Kishikai Shogi Festival in Miyagi andreconstruction efforts related to the Great East Japan Earthquake

the Kishikai Shogi Festival in Ibaraki. (The event was canceled inand Shogi culture.

2020,2021 due to the COVID-19 pandemic.)

As part of our efforts to participate in social welfare activities to do

suffering significant

our share in SDGs, we started to work with Single Mothers Forum

income reductions by(SMF), an approved specified nonprofit corporation from 2020.

donating JPY10 million

We sponsor the Kishikai Christmas Festival to spread the popularity

We plan to provide single-parent households a joyful time withfor the third consecutiveof Shogi and contribute to the growth of Japanese culture. In

mums who could usually be too busy working and may have little

year, respectively, to2019, it was held at our Asakusabashi Hulic Hall, and over 200

time for her children in everyday life. However, with the COVID-19

SMF.

people participated. (The event was canceled in 2020, 2021 due toSupport for Kishikai Christmas Festival

Corporate Governance

Hulic Insurance Service is a member of the Aflac National

The 93rd Hulic Cup Kisei championship

Environmental Initiatives

Emergency food stockpile at Hulic headquarters building

the COVID-19 pandemic.)

pandemic spreading globally, instead of providing enjoyable
events to the single-parent households, we decided to support

Data

the activities of SMF in sending foods to families who have been
2019 Christmas Festival

Sponsorship of the Hulic Cup Hakurei Championships and Women's Rank-deciding Shogi Competition
started in November

established a new rank-deciding Shogi competition for women,

2020, the seven

In 2021, we concluded a basic agreement with the Japan Shogi

relocation of the Tokyo Shogi Hall and promote the relocation

the Hulic Cup Hakurei Championships, with the aim of expanding

match series were

Association to relocate the Tokyo Shogi Hall to the first floor ofand reconstruction plan. In this way, we are contributing toopportunities for female professional Shogi players. Beyond

held from September

Hulic’s Sendagaya Center Building, as part of the reconstruction

the development of the Sendagaya District in Shibuya Ward, in

supporting the arts and culture, we decided to support professional

to November

project. Taking advantage of this agreement, Hulic and the Japan

cooperation with Shibuya Ward, which aims to become known asfemale Shogi players from the perspective of empowering women.

2021. Ms. Tomoka

Shogi Association will further deepen their collaboration on the“Shogi Town Shibuya Ward.”

The number of the women’s championships became eight, the same

Nishiyama became

number as in the male professional Shogi player’s championships

the first Hakurei title

by establishing the Hakurei Championships in addition to creating

holder after winning

the Seirei Championships. The match opportunities for the womenin the seven-match

professional Shogi players have increased significantly. Rank-

series.

External Evaluation

Relocation of Tokyo Shogi Hall

In 2020, Hulic together with the Japan Shogi Association

A ceremony honoring Mr. Tomoka Nishiyama with the first
Hakurei title In the first Hulic Cup Hakurei Championships

deciding matches in the 1st Hulic Cup Hakurei Championship88

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89

Hulic views the promotion of sustainable agriculture as one of

we have been supporting AgriFuture Japan, an organization thatJapan Para-Badminton Federation and have provided support forour most important sustainable management issues, so we arehelps develop the next generation of farmers, as part of our socialpara-badminton since 2016. For the purpose of supporting the stablepromoting an agri-business project. In this project, since 2014

contribution.

We have concluded an Official Gold Partner Agreement with theChampionships 2022.

operations of the federation, since 2017, we have lent the gym of
Nishi Kasai Center Building owned by Hulic (Hulic Nishikasai Gym) toHolding the 9th Hulic Student Idea Competition on the Theme of Architecture for a New
International City of Culture

the federation at no charge as a practice gym dedicated for players
from the Japan Para-Badminton Federation. We have conductedimprovement work such as installation of slopes and plumbing so

We planned this competition as a real estate company with thethree winners of the excellence award, and six winners of thethat the players can use the gym more comfortably.

aim of providing students with opportunities to propose urban

honorable mention award were selected.

Additionally, we have been supporting the world championships

development and construction ideas. We
received 132 entries for the 9th Hulic Student

and international games when they are held in Japan. This year, weare sponsoring the HULIC DAIHATSU BWF Para-Badminton World

HULIC DAIHATSU Japan Para-Badminton International tournament

Idea Competition in 2021. At the second public
review (held online to prevent the spread ofMaking the Company's Nursery Facilities Available to Local Community
Hulic has set up a daycare center inside the headquarters, making

see the following linked page.

some space available to local children to help reduce the numberWEBof children waiting to get into daycare centers. For details, please

Establishment of Hulic’s Onsite Childcare Nursery Facility
https://www.hulic.co.jp/en/sustainability/social/employee/balance.
html#anc2

COVID-19), students enthusiastically presented
their ideas, followed by a question and answer
session with judges. After consultations among
the judges, one winner of the grand prize,

A poster of the event, calling for entries

Second public review, held online (2021)

Supporting Environmental Studies at Kyoto University
Hosting Summer Festivals and Donating of a Portable Shrine

Hulic supports studies that have an environmental theme.

Furthermore, we are promoting discussions on more ways to use

In October 2012, the head office of Hulic was moved toof our community contribution activities, we donated a portable

Currently, we are supporting research at Kyoto University related towood through opinion exchanges between the laboratory and our

Nihonbashi, Odenma-cho. As part of our efforts to introduce

shrine, etc. to the Odenma-cho Ninobu Neighborhood Association

the use of wood in construction. This research is closely related todepartment in charge of environmental technology.

ourselves to the community, we held the Hulic Odenma Summer

to which we belong in 2017. We hope that carrying this portable

our efforts to build fireproof and other wooden structures.

Festival at our head office building in July 2013. The event was

shrine at the festival will lead to further revitalization and prosperity

very well-received, so we have continued to hold it every summer

in the area.

Sponsorship to Support Mainichi Shimbun in Fukushima Relief Efforts

is cooperating with us on the day of the event, and many people

We have been supporting the Ganbappe, Fukushima! event

come, from children living in the area to office workers fromorganized by The Mainichi Newspapers Co., Ltd. and Mushu Co.,

nearby buildings. We hope that activities such as this will lead toLtd. held at Belle Salle Tokyo Nihonbashi as an activity to support

deeper bonds between local residents. The proceeds from thereconstruction efforts in Fukushima, which was struck by the Great

festival has been added to the matching gift program, and the gift

East Japan Earthquake. On the day of the event, people frommoney has been provided to authorized NPOs. Moreover, as part

supporting companies support Fukushima's reconstruction.

Corporate Governancesince then. The Odenma-cho Ninobu Neighborhood Association

Environmental Initiatives

Support for AgriFuture Japan

Social Initiatives

Support for Japan Para-Badminton Federation

Our Approach to Sustainability

Social Initiatives

Donating Books to a Nearby Elementary School
children to give attention

local community, we learned that classroom libraries were worn

and thoughts to buildingout at Nihonbashi Elementary School, which is near our heada sustainable society.

Photograph courtesy of the Mainichi Newspapers

Data

issues to encourage

considering more ways to further deepen our connection with theDonation to Ashinaga Scholarship Society

office building, and in need of replacement. As such, we donated

The Hulic Group made a monthly donation of 500,000 yen to thechildren left as orphans following the Great East Japan Earthquake.

approximately 1,000 new books. We asked the school to choose

Ashinaga Scholarship Society from June 2011 to May 2019, andSince the outset, approximately JPY65,000,000 in total has beena certain amount of money has also been donated every month

donated by the Company and individuals as of May 2019. In orderto this Scholarship Society from the Company's directors andto provide wider support for domestic disaster, we changed theemployees who wish to participate in this initiative in an effort

donation destination from the Ashinaga Scholarship Society to theto provide continuous support for the living and schooling of theTokyo branch of Japanese Red Cross Society in August 2019.

books that include content related to SDGs and environmental

Book donation ceremony

Support for Scholarship Program of Kyoto University
We provide grant scholarships to Kyoto University students through the Kyoto University Fund with the aim of supporting the education ofchildren who will forge the future of this country by supporting

the next generation.

90

Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

We are active in contributing to the local community. While91

Social Initiatives

in volunteer activities, in order to support and nurture their efforts
to give back to the community and help to foster an attitude ofwanting to address issues facing society. The volunteer paid leave

Social contribution by employees

program is designed to support employees who participate insocial contribution activities. Employees are eligible to take up to● Matching gift program● Support activities in disaster-struck areas

20 consecutive days of special paid leave (employees who take part

● Satoyama conservation activities● Monthly community cleanup activities

in volunteer activities in disaster-hit areas can take paid leave more● Donation to the Tokyo branch of Japanese Red Cross Society

than once within 20 days) under the volunteer paid leave program
to take part in philanthropic activities that give back to society. To
encourage employees to use the volunteer paid leave program,
we provide not only information on social contribution activities,

Matching Gift Program

but also raise awareness about such activities among employees

Launching the match gift program in June 2008, we establishedneeds. These are the main fields under Hulic’s policy for social

by disseminating the volunteer experiences of employees with

the Hulic Fureai Fund, which deducts 100 yen every month fromcontribution. The Company matches donations with an equal

the entire Company through our intranet system. In 2019 wethe salary of employees who want to take part in the program (300

amount. At present, nine Hulic Group companies are working

continued satoyama conservation activities, which we have

yen for executive officers). The money collected is then donated

together on this activity. We will continue the donation activities,

conducted annually since 2009 as a participatory volunteer activity

to organizations selected by majority vote of all employees thatproviding opportunities of social contribution to employees who

involving our employees, and a total of 33 employees and their

are involved in activities related to local environment protection,cannot make the first step despite being interested in it.

family members from Hulic, Hulic Insurance Service, Hulic Building

coexistence with local communities, and responses to social

Objective

As Hulic holds many properties in Tokyo, we came up with
the idea to protect the precious natural environment leftin Tokyo and participated in the Satoyama Conservation
Activities.

Summary

The company participates in the Tokyo Greenship Action
hosted by the Bureau of Environment, Tokyo Metropolitan
Government, every year, and engages in various
volunteering activities in Yokosawairi in Akiruno City suchas the rice harvesting experience, trimming of shrubs andweeds in the skirts of a mountain under the supervision of
the NPO called “Yokozawairi tanbo no kai.”Management, Hulic Reit Management and Hulic Proserve haveparticipated in this activity.

The 13rd Donations to the Kiko Network (NGO/NPO)

The event was canceled in 2020,2021 due to the COVID-19

In 2021, JPY1.8 million was donated to Kiko Network, ancountermeasures inauthorized nonprofit organization in Japan. Kiko Network

Japan, promoting

helps to prevent climate change by cooperating with citizens

local decarbonization,

to make policy proposals as well as disseminating informationand human resource

and carrying out various environmental activities from a citizen’s

development.

pandemic.
WEB

Date
Number ofparticipants

26-Sep-19
33

Satoyama Conservation Activities by its Employees
https://www.hulic.co.jp/en/sustainability/ecology/management/
education.html

Stipend Program for Disaster Recovery Volunteers

perspective. Since being established in 1998, Kiko Network has
been working in diverse areas at the international, national, andThe Hulic Group has established a framework for subsidizing up to

we will continue to promote to all employees through our intranet

regional levels including international negotiations, global warming

60,000 yen of the cost of employees’ volunteer activities to support

information on volunteer activities. This information includes

reconstruction in disaster-stricken areas following the Great East

the results of volunteer activities as well as the thoughts of theJapan Earthquake. One person was subsidized in FY2019, while

participants, the situation on the ground, and information on

25 have received assistance since 2011. We hope that this systemreconstruction support tours.

will be a catalyst for greater understanding of conditions in the(These have not been used in 2020,2021 reflecting the spread ofdisaster zone and will increase interest in the area. Going forward,

COVID-19.)

Time

Year

1st

2009

WWF Japan

800,000

2nd

2010

Aladdin Caregiver Support Network Center

620,000

3rd

2011

Doctors of the World Japan (MEDECINS DU MONDE JAPON)

620,000

4th

2012

Nonprofit Organization Kokkyo naki Kodomotachi (KnK)

800,000

5th

2013

Florence

1,000,000

corner) Clean Day project run by Chuo

6th

2014

Kid's Door

1,200,000

Ward, where our headquarters is located.

7th

2015

Civic Force

1,300,000

8th

2016

NPO After School

1,200,000

and comfortable environment. Through

9th

2017

NPO Second Harvest Japan

1,300,000

these activities, we are also promoting

10th

2018

OISCA, nonprofit incorporated association

1,400,000

communication between local people and

11th

2019

NPO Japan Committee, Vaccines for the World’s Children

1,500,000

12th

2020

Musubie (an NPO who supports providing meals to children)

1,400,000

Hulic Co., Ltd. Sustainability Book 2022

Amount (JPY)

Community Cleanup Activities/Flowerbed Maintenance Activities

Data

Name of Organization

We participate in the Machikado (street

Once a month, we clean up around ourhead office with the aim of creating a clean
External Evaluation

Past Donations

92

Summary of Satoyama Conservation Activities

Environmental Initiatives

The Hulic Group has established paid leave for employees involved

Social Initiatives

Paid Leave for Employees Involved in Volunteer Activities

Corporate GovernanceFundamental
Approach

We work to resolve social challenges and make contribution to the sustainable developmentof society. Further, we strongly support each employee to participate in social contribution
activities.

Our Approach to Sustainability

Supporting Employees to Participate in Social Contribution Activities

employees.

Hulic Co., Ltd. Sustainability Book 2022

93

Appointment

Coordination & Collaboration
Audit

Corporate Governance

Board of Directors●Number of effectiveness assessment of the Board of Directors: 1 time
●Number of compliance training sessions: 5 times (4 times for employees and once for officers)●Number of Risk Management Committee meetings: 4 times●Number of Fund and ALM Committee meetings: 16 times (12 regular meetings and 4 special meetings)●Number of BCP drills: 3 times●Number of inspections of stockpiled food: 4 times●Number of inspections of stockpiled goods: 1 time

Real Estate
Planning and
AffiliatedBusiness Division Administration Division Companies
Internal control functions of head office and affiliated companies

system. We disclose all information required by the Corporate

Corporate Governance Guidelines
https://www.hulic.co.jp/en/sustainability/governance/governance/pdf/cgg.pdf

94

that adopting the managing officer system, appointing external
officers, and establishing various committees have enabled us

Nominating Committee, Remuneration Committee, Accounting

to build a corporate governance system that is sound and highly

Auditor, and the internal control system. The Company believes

efficient, as well as one that has an optimal structure for us.

Hulic Co., Ltd. Sustainability Book 2022

Risk Management Committee
Fund ALM Committee

Internal Controls

Operations management
Business management
Internal controls over financial
reportingDisclosure Working Group

Board of Directors

Audit &
Supervisory
Board

Hulic is a company with an Audit & Supervisory Board, which includes five Audit & Supervisory Board members(two are full-time auditors and three are External Auditors, following the Companies Act and Ordinance for
Enforcement of the Companies Act).
In audit conducted by the Audit & Supervisory Board members, auditors monitor the operations of the internal
control system and the status of its implementation through audit of the execution of duties by directors,
managing officers and each division in accordance with the audit basic policy and the audit basic plan formulatedby the Audit & Supervisory Board. These audits include attending the Board of Directors meetings as well asother meetings and committees when required, interviews on the execution of duties by directors and managing
officers, and reviewing important documents, approval documents and accounting records, etc. The Audit &Supervisory Board Office has been established to support the duties of the Auditor & Supervisory Board members.

Nominating
Committee

The Nominating Committee, consists solely of independent external directors, deliberates on the appointment ofcandidates for director and the Audit & Supervisory Board membership.

Remuneration
Committee

Specific amounts for the remuneration of directors are deliberated on and determined by the Remuneration
Committee, which consists solely of independent external directors, within the limits of the amounts approved at
the General Meeting of Shareholders.

Accounting
Auditor

The Company has an audit contract with Ernst & Young ShinNihon LLC to conduct audits.

Overview of Corporate Governance System and Reason for Adopting Current Systembodies such as the Board of Directors, Audit & Supervisory Board,

Risk Management

The Board of Directors ("The Board") consists of 10 members (four are independent external directors) who
resolve issues specified in laws and the Articles of Incorporation as well as important matters related to businessexecution based on the Board of Directors Rules. The Board also oversees the overall execution of duties bydirectors and managing officers. From April 2022, a non-execution board member started to chair the board
meetings in the aim of further strengthening our corporate governance mechanism.
The Board holds regular meetings (once a month, in principle), and special meetings of the Board of Directors areheld when necessary. The Company is strengthening the oversight role of the Board on overall business execution
by directors and managing officers to ensure sound management, such as by adopting the managing officer
system. The managing officers are appointed by the Board and are responsible for business execution. In addition,
the Company believes effective corporate governance is ensured by reinforcing the structure of the internal audit
function and by improving the internal control system. The Company’s Articles of Incorporation stipulate that theBoard should consist of no more than 12 members in order to facilitate its functioning.

Corporate Governance Mechanism
The corporate governance structure of the Company includes

Compliance Committee

The Company Organization

Governance Code.
WEB

Compliance

Disclosure Control

Corporate Governance Guidelines
promote the effective functioning of our corporate governance

Coordination &Collaboration

Internal audit

Sustainability Committee Participation rate in the Board of Directors' Meeting: 99%《Results in FY2021》●

Accounting Auditor

Accounting audit

ReportHulic Group recognizes that it is an important business issue to build a corporate governancesystem with fully functioning internal control, risk management, compliance, and disclosure
control.
We intend to sincerely execute business, fulfilling accountability to stakeholders.

We adopted "Corporate Governance Guidelines" as principles to

Coordination &Audit & Supervisory
Collaboration
Board Office

President and Representative Director

Fundamental
ApproachCorporate Audit
Department

Environmental Initiatives

Deliberation/
ReportAudit &
Supervisory Board

Social Initiatives

Nominating Committee

Appointment

Appointment

Hulic Co., Ltd. Sustainability Book 2022

Corporate Governance

Remuneration Committee

Deliberation/
Decision

Our Approach to Sustainability

General Meeting of Shareholders

Data

Hulic works to strengthen corporate governance with the aimof improving the transparency and efficiency of management
and continue to be trusted by society.

Diagram of Hulic’s Corporate Governance (as of March 23, 2022)

External Evaluation

ESG

Corporate GovernanceInitiatives

95

Committees

The Company's Board of Directors, Audit & Supervisory Board, Nominating Committee and Remuneration Committee include the following

We established four committees to ensure cross-departmental deliberation and coordination on company-wide matters.

members: As of April 1, 2022, there were 14 males and one female members. (The percentage of female officers was 6.7%.)

Purpose, Matters Deliberated and Coordinated

Title

Name

Board ofDirectors

Audit &
Supervisory
Board

Nominating
Committee

Remuneration
Committee

Compliance Committee

・Formulation and revision of compliance program.
・Matters related to information security management.

Chairman, Representative Director

Saburo Nishiura・Timely manage and respond to overall risk in accordance with the Basic Rules of Risk Management.
・Respond to facts occurred.

〇

―

―

―

Risk Management
Committee

President, Representative Director

Takaya Maeda

〇

―

―

―

Vice President, Representative Director

Hidehiro Shiga

〇

―

―

―

Director, Vice President

Hajime Kobayashi

〇

―

―

―

Fund ALM Committee

・The basic matters related to ALM.
・Procurement and investment of funds.
・Sale, purchase and investment of securities.
・Matters pertaining to the market risk management and liquidity risk, etc.

Director, Senior Executive Managing Officer

Tadashi Nakajima

〇

―

―

―

Director, Chairperson (non-execution) of theboard meetings

Manabu Yoshidome

◎

―

―

―

・Initiatives on sustainability and implementation of related activities.
・Formulation and revision of materiality and related KPIs.

External Director

Tsukasa Miyajima

〇

―

◎

〇

External Director

Hideo Yamada

〇

―

〇

◎

External Director

Atsuko Fukushima

〇

―

〇

〇

External Director

Nobuharu Tsuji

〇

―

〇

〇

Full-Time Audit & Supervisory Board Member

Shigeo Nakane

―

◎

―

―

Full-Time Audit & Supervisory Board Member

Masahiro Okamoto

―

〇

―

―

External Auditor

Koichi Nezu

―

〇

―

―

External Auditor

Nobuyuki Kobayashi

―

〇

―

―

External Auditor

Kenichi Sekiguchi

―

〇

―

―

Nominating Committee and Remuneration Committee
We have established “discretionary committees” following thedirectors as members of Nominating Committee and Remuneration

enactment of the Corporate Governance Code, effected on June

Committee to further strengthen governance from 2021 since both

1, 2015. All members of each committee are independent external

committees are highly interrelated.

directors from 2019. In addition, we made all four external
Nominating Committee

Remuneration Committee

The Nominating Committee serves the function of reporting to

The Remuneration Committee is appointed by the Board, andthe Board on the nomination of officers, and deliberates on the

deliberates and makes decisions on the matters outlined below.

following matters:

1.Remuneration standards and other matters pertaining to the

1.Selection of director and auditor candidates, changes to directors(promotion, etc.) and dismissals of directors
2.Other items concerning succession plans and matters concerning* The chairpersons are indicated with ◎.

Attendance rate at Board of Directors’ meetings, Audit & Supervisory Board meetings, and discretionary
committee meetings in FY2021

remuneration of directors
2.Matters concerning the remuneration of directors, as deemed

Title

Name

necessary by the Board

Board ofDirectors

Audit &
Supervisory
Board

Nominating
Committee

Remuneration
Committee

The committee consists of 4 members that are all independent

Chairman, Representative Director

Saburo Nishiura

100%

―

―

―

The committee consists of 4 members that are all independent

external directors. In principle, the committee is held at a request

President, Representative Director

Manabu Yoshidome

100%

―

―

―

external directors. In principle, the committee is held at a requestof chairperson of the committee in December and March, twice

Vice President, Representative Director

Hidehiro Shiga

100%

―

―

―

of chairperson of the committee in December, once a year. Ina year. In addition, other committee members can convene theVice President, Representative Director

Takaya Maeda

100%

―

―

―

addition, other committee members can convene the committee if

committee if deemed necessary.

Director, Senior Executive Managing Officer

Hajime Kobayashi

100%

―

―

―

Director, Senior Executive Managing Officer

Tadashi Nakajima

100%

―

―

―

External Director

Tsukasa Miyajima

100%

―

100%

100%

External Director

Hideo Yamada

100%

―

100%

100%

External Director

Atsuko Fukushima

100%

―

100%

100%

External Director

Kaoru Takahashi

100%

―

100%

100%

Full-Time Audit & Supervisory Board Member

Shigeo Nakane

100%

100%

―

―

Full-Time Audit & Supervisory Board Member

Takuya Asai

100%

100%

―

―

Full-Time Audit & Supervisory Board Member

Masahiro Okamoto

100%

100%

―

―

External Auditor

Koichi Nezu

100%

100%

―

―

External Auditor

Nobuyuki Kobayashi

100%

100%

―

―

External Auditor

Kenichi Sekiguchi

93%

87%

―

―

the abovementioned items, as deemed necessary by the Board

deemed necessary.

Assessment of the Effectiveness of the Board of Directors
The Board of Directors implements an annual self-assessment

・Ensure that the meetings are proceeded more efficiently by

to continuously ensure its effectiveness, implementing pertinent

requesting materials that articulate discussion points, andrevisions to Board management based on these evaluations.

practice more extensive deliberation and discussion for important

The result of FY2020 assessment was concluded that corporate

resolutions including medium- and long-term management policy.

governance was functioning effectively as the analysis and・Indicate a wide range of risks involved in business and further

assessment showed that 1) External Directors with diverse expertiseenhance the appropriate level of risk evaluation.

comprise 40% of the total, 2) The Board is fostering a culture in・Deepen discussion on environment, social and governance (ESG)-

which directors can express their opinions, and 3) appropriate risk-

related topics referencing objective indicators with a view to thetaking and risk management in being carried out.

private sector's role in relation to achieving the SDGs.

However, the following points were confirmed as ongoing・Consider the composition of the Board of Directors from thechallenges for the Board to work on.

perspective of diversity on an ongoing basis.

Hulic Co., Ltd. Sustainability Book 2022

* Attendance rates are calculated based on the meetings held in January to December 2021. Attendance rates of Takuya Asai is calculated based on the meetings held inJanuary to March 2021, and that of Masahiro Okamoto is calculated based on the meetings held in April to December 2021.

Hulic Co., Ltd. Sustainability Book 2022

Corporate Governance

Sustainability Committee

Environmental Initiatives

Attendance Rate at Board of Directors’ Meetings, Audit & Supervisory Board Meetings, andDiscretionary Committee Meetings

Social Initiatives

ensure soundness and efficiency of business management.

Committee Name

96

The Board of Directors, Audit & Supervisory Board, and Committees

Data

We separate oversight of management by the Board of Directors and business execution by introducing the managing officer system toExternal Evaluation

Managing Officer System

Our Approach to Sustainability

Corporate Governance Initiatives

97

management, (6) personnel and labor affairs and human resources

Outline of Limited Liability Agreements

have defined the skills we consider necessary for directors as thosedevelopment, and (7) the real estate business.

Pursuant to Article 427, Paragraph 1 of the Companies Act, theand each Audit & Supervisory Board Member, to limit their liability

related to (1) corporate management, (2) sustainability and ESG,

We appoint directors with the right skills in accordance with theseCompany has entered into an agreement with each Director

for damages under Article 423, Paragraph 1 of the Companies Act(3) finance and accounting, (4) legal affairs and compliance, (5) risk

requirements, and their skills are shown in the table below.

(excluding Directors with executive authority over operations, etc.)

to the maximum amount stipulated by law.

Corporate
management

SaburoNishiura

Chairman,
Representative
Director

TakayaMaeda

President,
Representative
Director◎

Hidehiro
Shiga

Vice President,
Representative
Director〇

HajimeKobayashi

Vice President,
Director〇

TadashiNakajima

Director, Senior
Executive
Managing Officer

ManabuYoshidome

Chairperson of theBoard of Directors,
Director (nonexecutive)

Tsukasa
Miyajima
Hideo
Yamada◎Sustainability
and ESG〇

Shinji Tsuji

External Director

〇

〇

〇

〇
〇

〇

〇

Real estatebusiness〇◎

his or her duties as a Director or Officer of the Company.

agency that covers Director and Officer liability for damages (D&O

・In addition, the policy also covers any costs incurred by the insured

insurance), as stipulated in Article 430-3, Paragraph 1 of the

Directors or Officers that may be required to respond to a potential

Companies Act. The details of the policy are as follows.

claim for damages, even if no such claim was being made.

ⅰS cope of insured persons

As a measure to ensure that the appropriateness of the execution

The Company’s Directors and Audit & Supervisory Board Membersof duties by the Directors and Officers is not compromised, theunder the Companies Act.

D&O insurance adopted by the Company exempts from liability

ⅱ Percentage of premiums paid by Directors and Officers

〇

〇

◎

◎

〇

policy concluded by the Company.
ⅲ Outline of the insurance policy

〇

〇

〇

〇

◎

〇

〇

〇

〇

◎

〇

illegally obtained personal benefits or favors－ Criminal acts committed by Directors or Officers, or acts
committed by Directors or Officers while aware of theirFebruary 1, 2022 to February 1, 2023.

illegality

・T he policy covers damages (legal damages and litigation expenses)
incurred by a Director or an Officer, in the event of a claim by ashareholder or third party during the insurance period, arising〇

the following acts that are offensive to public order and morals.
－ Claims for damages arising due to a Director or Officer having

The coverage area is worldwide, and the insurance period is fromThe following is an outline of the events insured by the policy.

from an act (including an omission) conducted in the course of－ Claims for damages arising from the illegal payment of
remuneration or bonuses, etc. to Directors or Officers－ Claims for damages arising from insider trading by Directors
or Officers－ Claims for damages arising from the provision of illegal benefits

Decision-making Body for Exemptions by Directors and Others〇◎◎

External Director
External Director〇

Riskmanagement

The Company pays all annual premiums for the D&O insurance

External Director

AtsukoFukushima

Finance andaccounting

Outline of the Insurance Policy that Covers Director and Officer Liability for Damages
The Company has concluded an insurance policy with an insurance〇◎◎*1 A ◎ in a director's skill matrix means the director in question has particularly outstanding skills in that particular area.
*2 The above list is not intended to be an exhaustive list of the knowledge and experience possessed by each director.

〇〇

Pursuant to Article 426, Paragraph 1 of the Companies Act, thebe exempted from liability for damages to the Company to theCompany stipulates in its Articles of Incorporation that Directors

extent permitted by law, by resolution of the Board of Directors.

(including former Directors), Audit & Supervisory Board Members

The purpose of this provision is to ensure that Directors, Audit &(including former Audit & Supervisory Board Members), andSupervisory Board Members, and Accounting Auditors fully fulfill

Accounting Auditors (including former Accounting Auditors) may

their expected roles.

Executive Officer Nominations
The Company’s Articles of Incorporation stipulate that resolutions

Shareholders, by relaxing the quorum for the election of Directorsof the General Meeting of Shareholders concerning the election ofand Audit & Supervisory Board Members at the General Meeting

Directors and Audit & Supervisory Board Members shall be adoptedof Shareholders. The Articles of Incorporation also stipulate thatby a majority of the voting rights of the shareholders present at

resolutions for the election of the Board of Directors shall not be

the meeting, at which shareholders holding one-third or more

made by cumulative voting.

of the voting rights of shareholders who are entitled to exercise

While Directors and Audit & Supervisory Board Members are

their voting rights are present. The purpose of this provisionelected at the General Meeting of Shareholders, the following

is to ensure the smooth operation of the General Meeting ofpolicies and procedures have been established for their nomination.

Corporate Governance

Title

Personnel andlabor affairs
and human
resourcesdevelopment

Data

Name

Legal
affairs andcompliance

Environmental Initiatives

Liability of Directors and Others

To achieve our Medium- and Long-Term Management Plan, we

Social Initiatives

Director Skill Matrix

Our Approach to Sustainability

Corporate Governance Initiatives

When nominating candidates for the Board of Directors or

make on improvements to the corporate value from an unbiased

the Audit & Supervisory Board, in addition to having excellent

perspective. Efforts are made with regard to Audit & Supervisory

character and insight and appropriately fulfilling the duty of care,

Board candidates in particular, to appoint at least one candidate

candidates are selected based on their professional experience

with extensive accounting knowledge.

and expertise as well as the contribution they are expected toProcedures for Nominating Board of Director and Audit & Supervisory Board Member Candidates

98

Hulic Co., Ltd. Sustainability Book 2022

When nominating candidates for the Board of Directors or thecomprised entirely of independent external directors. The reasons

Audit & Supervisory Board, reports are submitted to the Board offor nominating each candidate are included in General Meeting of

Directors after deliberation by the Nominating Committee, which is

Shareholders convocation notices.

Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

Policy on Nominating Board of Director and Audit & Supervisory Board Member Candidates

99

for directors will not change if the percentage change in thepayments and stock compensation, and basic compensation,

preceding fiscal year's consolidated ordinary income falls below a

Policy for Determining Executive Officer Compensation, etc.

which is in addition to performance-linked compensation.

certain level. The ratio of performance-based compensation in theCompensation of directors consists of basic fixed compensation,

growth of the Company and to enhance corporate value from the

Performance-linked compensation accounts for 40 to 50% andform of bonuses (monetary portion) to share-based compensation

which is based on post and the weight of responsibilities, andshareholders’ perspective.

basic compensation accounts for 50 to 60% of total director(BBT) is 1:1, and a clawback mechanism is in place that will revoke

performance-linked compensation, which is linked to earnings

Furthermore, compensation of external directors and external

remuneration. Basic compensation is paid monthly, while

share-based compensation granted in the past if any misconduct

performance of the Company and contribution to earnings. In

auditors solely consists of basic compensation (fixed amount) in

performance-based compensation is paid at a certain time, based

occurs. With regard to the actual results of the indicators related

accordance with a resolution at the 86th General Meeting oflight of their roles and responsibilities.

on the results of each fiscal year. Hulic uses the percentage ofto performance-based compensation, actual consolidated ordinary

Shareholders, a portion of performance-based compensation

Moreover, a resolution pertaining to the method for determiningchange in preceding fiscal year consolidated ordinary income asincome was JPY109,581 million (up 14.5% year-on-year),is allocated to a share-based payment plan designed to give

executive officer compensation was passed at a Board of Directors

an indicator for performance-based compensation. Our businesscompared to the consolidated earnings forecast of ordinary income

incentives for performing duties, in order to achieve the sustainablemeeting held on February 18, 2021.

performance is concisely represented by consolidated ordinary

at JPY108,000 million for FY2021, as announced in the Notice ofincome as it takes into account interest expenses and other

Revisions to Annual Performance and Dividend Forecast released

General Meeting of Shareholders Resolution Details Related to Executive Officer Compensation, etc.

nonoperating income, thus we decided to use the percentage

on January 11, 2022. As a result, despite the spread of COVID-19,

A resolution at the 92nd General Meeting of Shareholders

for directors (excluding external directors).

of change in consolidated ordinary income as it is considered

the Company’s performance was on track to meet the goals of

stipulates an annual amount of up to JPY1,000 million (upWhen determining specific compensation, the Remuneration

to represent a medium- to long-term sustainable increase inboth its Medium-term Management Plan, which ends in FY2022

to JPY120 million for external directors) for Board of Director

Committee, which consists entirely of independent external

shareholder value.

and its Long-term Management Plan, which ends in FY2029.

monetary compensation, with bonus payments paid within that

directors authorized by the Board of Directors, deliberates andrange. Additionally, a resolution at the 85th General Meeting of

makes decisions within the scope of compensation determined by

Shareholders stipulates an annual amount of up to JPY150 million

the General Meeting of Shareholders. Further, Audit & Supervisory

for Audit & Supervisory Board member monetary compensation.

Board member compensation is determined as a separate system

A resolution at the 92nd General Meeting of Shareholders

from director compensation within the scope of compensation

stipulates a change in Board Benefit Trust (BBT) to a maximum of

determined by the General Meeting of Shareholders, in

300,000 points per fiscal year with regard to share-based payments

consultation with the Audit & Supervisory Board.

Directors/Auditors’ Compensation

Post

Total
amount ofcompensation(JPY million)

Total amount by type of compensation (JPY million)
Fixedcompensation

Performancelinked variable
compensation(in stock)

Performancelinked variable
compensation(bonus)Of theseamounts, nonmonetarycompensation

Number of
directors/
auditors

Directors (excluding External
Directors)

1,072

545

263

263

263

6

Auditors (excluding External
Auditors)

72

72

―

―

―

3

The Company has established a Remuneration Committee,

with the policy for determining the details of remuneration, etc.

which consists solely of independent external directors (fourfor each individual Director. The Board of Directors believes that

External Directors /Auditors

126

126

―

―

―

7

members). The decision on the amount of remuneration, etc.

the process of such review, and the details of the determinationfor each individual Director is entrusted to the Remuneration

are reasonable, and judges that the details are in line with such

Committee, within the amount resolved at the General Meeting

determination policy.

of Shareholders. This is to ensure that the evaluation and

In addition, retirement benefits for Directors have been abolished.

determination of Directors’ remuneration, etc. is conducted from

Remuneration for Audit & Supervisory Board Members is structured

an objective perspective.

separately from that for Directors, and is determined by discussion

The Remuneration Committee determines the details of

among the Audit & Supervisory Board Members, within the

Corporate Governance Report

remuneration, etc. for each individual Director for the fiscal year

amount resolved at the General Meeting of Shareholders.

The Company prepares and submits the Corporate Governancegovernance to the Tokyo Stock Exchange as part of timely

Report (in Japanese only) outlining the status of corporate

disclosure based on the regulations of the Tokyo Stock Exchange.

and the Procedures of Voluntary Committees*2 The total non-monetary compensation to directors (excluding external directors) consists of JPY263 million in performance-linked variable compensation (in stock).

Corporate Governance Report

External Evaluation

under review, after a multifaceted review, including consistency*1 The amount of stock compensation is provision to reserves for stock benefits posted as the portion for the current fiscal year, for performance-linked variable compensation system.

Data

Persons Authorized to Determine the Amount of Remuneration, etc. for Each Individual Executive Officer and Their Authority,

Environmental Initiatives

Moreover, the total amount of performance-based compensation

performance-based compensation, which consists of bonus

Social Initiatives

Director compensation (excluding external directors) includes

Matters Pertaining to Policies for Determining the Amount and Means of Calculating Executive Officer
Compensation, etc.

Corporate Governance

Performance-based Compensation

Executive Officer Remuneration, etc.

Our Approach to Sustainability

Corporate Governance Initiatives

100 Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022 101

Corporate Governance Initiatives

Representative Director, President

Takaya Maeda

April

1971 Joined The Fuji Bank, Limited

April

August2000 The Fuji Bank, Limited, Managing Executive Officer, Headof Corporate Group and General Manager of Corporate
Development Division

October 2007 Joined Hulic Co., Ltd., Deputy General Manager of Real
Estate Development Department 2

2004 Mizuho Bank, Ltd., Deputy President
2006 Joined Hulic Co., Ltd., President, Representative Director
and Chief Executive Officer

March

March

2016 Hulic Co., Ltd., Chairman, Representative Director (to
date)

April

2009 Hulic Co., Ltd., Director (Managing Officer), General
Manager of Real Estate Development Department 2

April

October 2017 The Resona Foundation for Future, Director (to date)2016 Sompo Japan Nipponkoa Himawari Life Insurance, Inc.
(currently Sompo Himawari Life Insurance Inc.), Director

April2017 Sompo Holdings, Inc., Group CFO, Representative
Director, Deputy President and Senior Executive Officer

March

April

2021 Hulic Co., Ltd., Representative Director, Vice President

March2022 Hulic Co., Ltd., Representative Director, President (to date)

Hajime Kobayashi
April

April

2010 Hulic Co., Ltd., Executive Managing Officer, General
Manager of Corporate Planning Department

April

2020 Hulic Co., Ltd., Representative Director and Vice President(to date)

February 2013 Hulic Co., Ltd., Senior Executive Managing Officer, General
Manager of Corporate Planning Department

Senior Corporate Auditor, Full-Time Audit & Supervisory Board Member

Shigeo Nakane

1985 Joined The Fuji Bank, Limited

April2008 Mizuho Bank, Ltd., General Manager of Iwaki BranchJuly

2010 Joined Hulic Co., Ltd., Executive Managing Officer,
General Manager of the Accounting Department

March2015 Hulic Co., Ltd., Senior Corporate Auditor, Full-Time Audit& Supervisory Board Member (to date)May

2012 Nomura Real Estate Holdings, Inc., Executive Officer

March2006 Mizuho Bank, Ltd., Managing Executive Officer

April2013 Nomura Real Estate Development Co., Ltd., Director,
Senior Managing Executive Officer, General Manager ofCommercial Property Development & Management Division

April2009 Mizuho Bank, Ltd., Deputy President

March2012 Joined Hulic Co., Ltd., Full-Time Audit & Supervisory
Board Member

March2015 Hulic Co., Ltd., Representative Director and Executive
Vice President

2014 Nomura Real Estate Development Co., Ltd., Representative
Director, Senior Managing Executive Officer, General Manager
of Commercial Property Development & Management Division

External Auditor, Audit & Supervisory Board Member

Koichi Nezu

April

March

2005 Registered as a tax accountant

April2007 National Institute for Environmental Studies, Japan,
AuditorMarch2009 Hulic Co., Ltd., External Auditor, Audit & Supervisory
Board Member (to date)April

2010 Nagoya University of Commerce & Business (graduate
school), Professor (to date)2002 Kabushiki Kaisha Seiyoken, External Director (to date)2016 Hulic Co., Ltd., President, Representative Director

May

2002 Nezu Museum, Chairman of the Board and Curator (to date)March2022 Hulic Co., Ltd., Director (Non-executive), Chairperson of
the Board of Directors (to date)May

2003 Tobu Utsunomiya Department Store Co., Ltd., Chairmanof the Board of Directors and President

April2006 Musashi Academy of the Nezu Foundation., Chairman of
the Board of Directors (to date)

April

External Director

Hideo Yamada
Kenichi Sekiguchi

April

2003 Registered as a lawyer

May

April

2004 General Insurance Rating Organization of Japan, Director

1998 TAIYO CHEMICAL INDUSTRY CO., LTD., External Auditor(to date)June2007 Meiji Yasuda Life Insurance Company, CouncilorJune

2004 SATO CORPORATION, External Director

April1972 Joined Yasuda Mutual Life Insurance Company

March2009 Hulic Co., Ltd., External Director (to date)March2006 Lion Corporation, External Director

April

June

2007 Ishii Food Co., Ltd., External Auditor
MIKUNI CORPORATION, External Auditor

2001 Yasuda Mutual Life Insurance Company, Executive Director,
Deputy Senior Manager of Asset Management Division
and General Manager of Operational Policy Division

March2009 Hulic Co., Ltd., External Director (to date)April

2002 Yasuda Life Direct General Insurance Company, Director
and President

March2011 Seibu Lions, Inc., External Auditor

April

2014 Daini Tokyo Bar Association, President
Japan Federation of Bar Associations, Vice President

June2015 SATO HOLDINGS CORPORATION, External Director (todate)
Akiko Tachibana Memorial Foundation, Chairman of theBoard of Directors (to date)102 Hulic Co., Ltd. Sustainability Book 2022

June

2016 MIKUNI CORPORATION, External Director (to date)

January 2004 Meiji Yasuda Life Insurance Company, Managing Director,
General Manager of New Market Sales DivisionDecember2005 Meiji Yasuda Life Insurance Company, Chairman of the Board
July

2006 Meiji Yasuda Life Insurance Company, Chairman of theBoard and Executive Officer

July2013 Meiji Yasuda Life Insurance Company, Special Advisor

March2014 Hulic Co., Ltd., External Auditor, Audit & Supervisory
Board Member (to date)2017 The Japan Institute for Labour Policy and Training,
Auditor (to date)

October 2017 Tokyo District Court, Adviser (to date)2015 Tobu Department Store Co., Ltd., Chairman Emeritus (to date)

External Auditor, Audit & Supervisory Board Member

2021 Japan Cooperative Insurance Association Incorporated,
Committee Member of Examination Committee (to date)July

2013 Tobu Department Store Co., Ltd., Chairman of the Boardof Directors
Tobu Utsunomiya Department Store Co., Ltd., Chairmanof the Board of Directors

1984 Registered as a lawyer

2018 Daifuku Co., Ltd., External Auditor (to date)

October 2011 Japan Arts Council, Auditor

October 2007 Hulic Co., Ltd., External Auditor, Audit & Supervisory
Board Member (to date)2015 Mitsui Sumitomo Insurance Company, Limited, External Director

1991 Registered as a certified public accountant

April

April

July

March

January 1999 Tobu Department Store, Representative Director and President

1990 Keio University Faculty of Law, Professor and Doctor of Law

June

External Auditor, Audit & Supervisory Board Member

Nobuyuki Kobayashi

1975 Joined TOBU RAILWAY CO., LTD.

April

2016 Keio University, Emeritus Professor (to date)
Asahi University, Professor of School of Law / Graduate
School of Law (to date)

2021 Hulic Co., Ltd., Senior Corporate Auditor, Full-Time Audit& Supervisory Board Member (to date)
Nippon View Hotel Co., Ltd., Auditor (to date)
TOKYO SOIR CO., LTD., External Director and Audit andSupervisory Committee member (to date)

December 1995 Established the Kobayashi Certified Public Accountants
OfficeMay

April

2016 Nippon View Hotel Co., Ltd., Full-time Statutory Outside
AuditorNovember 1990 Tobu Department Store Co., Ltd., Representative Director
and Senior Director

MarchJanuary 2019 Hulic Co., Ltd., Executive Managing Officer

June

July
March

Director (Non-executive), Chairperson of the Board of Directors

1977 Joined The Fuji Bank, Limited

October 2015 Den-en Chofu Gakuen, Councilor

October 2013 Mizuho Financial Group, Inc., General Manager of Legal
Division
Mizuho Bank, Ltd., General Manager of Legal Division

Manabu Yoshidome

2005 Mizuho Bank Ltd., Executive Officer, General Manager ofthe Human Resources Division2014 Dai Nippon Printing Co., Ltd., External Director (to date)
MIKUNI CORPORATION, External Auditor (to date)Senior Corporate Auditor, Full-Time Audit & Supervisory Board Member

Masahiro Okamoto
April

2022 Hulic Co., Ltd., Director (Vice President), General Manager
of Human Resources Department (to date)

April

June

2022 Sonpo Holdings, Inc., Director (to date)1980 Joined The Fuji Bank, Limited

April

April

October 2013 Japan Railway Construction, Transport and Technology
Agency, Asset Disposal Committee Chairman (to date)

2022 Hulic Co., Ltd., External Director (to date)April

2005 Mizuho Bank Ltd., General Manager of the Accounting
Division
2009 Senshu Shoji Co., Ltd., Auditor

2012 Nomura Real Estate Development Co., Ltd., Director,
Managing Executive Officer

October 2010 Japan Association of Private Law, Director

2021 Sompo Care Inc., Director

March

AugustJuly

1980 Joined Nomura Real Estate Development Co., Ltd.

Tsukasa Miyajima

2019 Sompo Holdings, Inc., Group COO, Director, Deputy
President and Representative Executive Officer

June

April

2013 Hulic Co., Ltd., Director, Senior Executive Managing Officer,
and General Manager of Corporate Planning Department

April

External Director

June■ Audit & Supervisory Board Members

March

April

2021 Hulic Co., Ltd., Director (Senior Executive Managing Officer) (to date)

January 2019 Sompo Holdings, Inc., Group COO, Representative
Director, Deputy President and Senior Executive Officer

February 2022 Kewpie Corporation, External Director (to date)1980 Joined The Fuji Bank, Limited

2006 Hulic Co., Ltd., Representative Director (Senior Executive
Managing Officer)

April2020 Councilor of Forestry Policy Council, Ministry ofAgriculture, Forestry and Fisheries (to date)2020 Hulic Co., Ltd., Director (Senior Executive Managing Officer)

July2020 Hulic Co., Ltd., Director (Executive Managing Officer)

2014 NKSJ Holdings, Inc., Representative Director, Deputy
President and Senior Managing Executive Officer

2014 Hulic Co., Ltd., Director (Executive Managing Officer),
General Manager of Real Estate Planning Department

2006 Joined Hulic Co., Ltd., Managing Officer, General
Manager of Corporate Planning Department

March2012 NKSJ Holdings, Inc., Director, Senior Managing Executive
Officer

April

August2017 Hulic Co., Ltd., Executive Managing Officer, General
Manager of Value-add Business Department, General
Manager of Development Solution Department

April

December 2006 Panasonic Corporation, Management Advisor

2009 Sompo Japan Insurance Inc., Managing Executive Officer

2015 Nagoya Railroad Co., Ltd., External Director (to date)
Calbee, Inc., External Director (to date)2003 Mizuho Bank Ltd., General Manager of Hamamatsu Branch

April2011 NKSJ Holdings, Inc., Director, Managing Executive Officer

2012 Hulic Co., Ltd., External Director (to date)2004 Mizuho Bank Ltd., General Manager of Gotanda Station Branch2016 Joined Hulic Co., Ltd., Executive Managing Officer, General
Manager of Real Estate Development Department 3

June

June

April

August2006 Shimane University, Management Council Member (to
date)

March

May

2016 Nomura Real Estate Development Co., Ltd., Advisor

2005 TV Tokyo economics program regular presenter

April

2013 Hulic Co., Ltd., Director (Managing Officer), General
Manager of Real Estate Planning Department

2006 Joined Hulic Co., Ltd., Senior Executive Managing
Director, Representative Director

April

April

April

January 2005 Mizuho Bank Ltd., General Manager of the Subsidiaries
and Affiliates Management Division

April

2008 Sompo Japan Insurance Inc., Executive Officer, General
Manager of Customer Service Department

April

April

March

Tadashi Nakajima

1979 Joined The Yasuda Fire & Marine Insurance Co., Ltd.

April

Director, Vice President, General Manager of Human Resources Department

1978 Joined The Fuji Bank, Limited

Director, Senior Executive Managing Officer

April1988 NHK contract presenter

October 2010 Hulic Co., Ltd., Director (Managing Officer), General
Manager of Business Planning Department

April

Hidehiro Shiga

1985 Joined CHUBU-NIPPON BROADCASTING CO., LTD.

April

October 1993 TBS contract presenter2008 Hulic Co., Ltd., General Manager of Real Estate
Development Department 2

January 2015 Hulic Co., Ltd., Director (Executive Managing Officer),
General Manager of Real Estate Development Department 1

Representative Director, Vice President

April

Social Initiatives

April
March

1984 Joined Taisei Corporation

External Director

Shinji Tsuji

Corporate Governance2002 Mizuho Bank Ltd., Managing Executive Officer

Atsuko FukushimaJune

2019 The Japanese Institute of Certified Public Accountants
Tokyo Chapter, Deputy Chairman (to date)

April

2021 Shinshu University, Specially Appointed Professor of
Faculty of Economics and Law (to date)

Data

April

June

External Director■ Managing Officers
Vice President

Executive Managing Officer

Yasuki Yakabi

Hiroshi Kitano

Shin Ito

Kazuhiro Noguchi

Hiroshi Hara

Yasushi Umeda

Mikio Morikawa

Yoshito Nishikawa

Yoshikazu Nagatsuka

Ken Ohta

Kazuteru Miyayama

Yuuji
Mutagamihigashi

Hiroyuki Iijima

Managing Officer

External Evaluation

Representative Director, Chairman

Saburo Nishiura

Environmental Initiatives■ Board of Directors

Our Approach to Sustainability

Directors, Auditors and Managing Officers (as of April 1, 2022)

October 2015 Kyushu Financial Group, Inc., External Auditor (to date)June

2018 Okuhiei Sankei Driveway Co., Ltd., Director (to date)
Shinjuku Subnade Co., Ltd., Director (to date)

April

2022 Meiji Yasuda Life Insurance Company, Honorary
Advisor(to date)

Hulic Co., Ltd. Sustainability Book 2022 103

Hulic has four external directors and three external Audit &Directors from a position independent from the execution of business

The expertise and reasons for selection of the External Directors and External Audit & Supervisory Board Members are as follows.

Supervisory Board members. External directors and Audit &and fulfill management oversight and check functions.

External Directors

External Directors and External Audit & Supervisory Board

Chairman of the Board of Directors, for the purpose of promoting

members meet the criteria in the guidelines on the independence

and disseminating the arts. However, in light of the nature andof independent executive officer(s) set out in Article 436-2 of thescale of the transactions, the Company believes that there is no risk

Securities Listing Regulations of the Tokyo Stock Exchange and theof influencing the judgment of shareholders or investors.

“Criteria for assessing the independence of independent external

External Director Shinji Tsuji serves as a Director of Sompo Holdings

directors” in Hulic's Corporate Governance Guidelines.

which is not a shareholder of Hulic but engages in transactions

We appoint suitable independent external directors and auditors

such as lending business funds, etc. with Hulic. Such relationshipwith excellent backgrounds, experience, and knowledge that fulfill

is permitted in the criteria established by the Company forour corporate governance requirements, using the criteria shown

determining the independence of independent external officers.

below. Furthermore, we maintain the number of independent

External Audit & Supervisory Board member Koichi Nezu is

directors more than one-third of all directors.

President of the Musashi Academy of the Nezu Foundation, an(1) Achieving the sustainable growth of the Company andorganization to which Hulic provides financial assistance to support

improving corporate value over the medium- and long-term

next-generation education. In view of the nature and scale of(2) Strengthening management oversightthe transactions, it has been determined that there is no risk of(3) Overseeing any conflict of interest among the Company,

affecting shareholder and investor decision making.

management, and shareholders

External Audit & Supervisory Board member Kenichi Sekiguchi(4) Effectively relaying, from an independent position, the opinions

serves as the special advisor who also served as the Chairman andof shareholders, including minority shareholders, to the Board

Representative Executive Officer until July 2013 at Meiji Yasudaof Directors

Life Insurance Company. Meiji Yasuda Life Insurance Company is

Please visit the Company's Corporate Governance Guidelines

a shareholder of Hulic which also engages in transactions suchon our website for our criteria for assessing the objectivity ofas lending business funds to Hulic. Such relationship is permitted

independent external directors/auditors.

in the criteria established by the Company for determining the

The Company pays donations to the Akiko Tachibana Memorial

independence of independent external officers.

Foundation, where External Director Hideo Yamada serves as theNote: Hulic has designated and registered directors Tsukasa Miyajima, Hideo Yamada, Atsuko Fukushima, Shinji Tsuji, and Audit & Supervisory Board members Koichi Nezu, Nobuyuki
Kobayashi and Kenichi Sekiguchi, as independent external officers with the Tokyo Stock Exchange based on the Tokyo Stock Exchange’s rules and regulations.

Attendance at Board of
Directors meetings in FY2021

Occupation/affiliation, etc.

Reason for appointment

Independent
Director

Tsukasa
Miyajima

15 of 15 (100%)

Professor Emeritus of Keio
University, Lawyer, Professor of
School of Law and Graduate,
School of Law of Asahi University

It is expected that Mr. Miyajima leverages his extensive trackrecord and insight as a person of academic standing in the
management of the Group, and the Company believes that
he appropriately performs his duties as an External Director.

○

15 of 15 (100%)

President of Yamada Ozaki Law
OfficeMr. Yamada has been active as a lawyer for years and has
refined views as a legal expert as well as experience as anexternal director of other companies, and the Company
believes that he leverages this expertise in the managementof the Group.

○

AtsukoFukushima

15 of 15 (100%)

Journalist, Councillor of Forestry
Policy Council, Ministry ofAgriculture, Forestry and Fisheries

Ms. Fukushima has been active in the media industry for years
and has extensive experience, so the Company believes she
can reflect her wide range of perspectives in areas including
socio-economics, environment, culture and diversity in the
management of the Group.

○

Kaoru
Takahashi*1

15 of 15 (100%)

Advisor, Sompo Holdings, Inc.*2

Mr. Takahashi has extensive experience and broad insight as
the top management of a major insurance company, andthe Company believes that he leverages this expertise in the
management of the Group.

○

ShinjiTsuji*3―

Director, Sompo Holdings, Inc.

Mr. Tsuji has extensive experience and broad insight as the
top management of a major non-life insurance company, andthe Company believes that he leverages this expertise in the
management of the Group.

○

Hideo
Yamada*1 Retired on March 23, 2022    *2 Retired on March 31, 2022    *3 Appointed on March 23, 2022

External Auditor and Audit & Supervisory Board members
Attendance at meetings in
FY2021Name

Board ofDirectors

Audit &
Supervisory
Board

Occupation/affiliation, etc.

Reason for appointment

Independent
Director

Mr. Nezu has a wealth of business management experienceand broad insight into management in general through his
management of a major department store, so the Company
expects him to be able to audit management objectively andfrom a neutral position as an External Auditor and Audit &Supervisory Board member.

○

KoichiNezu

15 of 15
(100%)

15 of 15
(100%)

Chairman Emeritus of Tobu
Department Store Co., Ltd.,Board Chairman and Curator of
Nezu Museum

Nobuyuki
Kobayashi

15 of 15
(100%)

15 of 15
(100%)

Director of Kobayashi Certified
Public Accountants Office

Mr. Kobayashi has specialized knowledge in accounting andtaxation as a certified public accountant and tax accountant,so the Company expects him to be able to audit management
objectively and from a neutral position as an External Auditor
and Audit & Supervisory Board member.

○

KenichiSekiguchi

14 of 15(93%)

13 of 15(87%)

Honorary Advisor of Meiji Yasuda
Life Insurance Company

Over the years, Mr. Sekiguchi has accumulated extensive
business management experience and broad insight aschairman, so the Company expects that he will be able toaudit management objectively and from a neutral position.

○

Corporate GovernanceIndependent External Directors and Independent External Auditors Nominations

Name

Data

Supervisory Board members provide comments at Board ofEnvironmental Initiatives

Expertise of External Directors and External Audit & Supervisory Board Members

Social Initiatives

External Directors and External Auditors

Our Approach to Sustainability

Corporate Governance Initiatives

External directors receive reports on internal audits, Audit &from the accounting auditor and the corporate audit department,

Supervisory Board audits, accounting audits and internal controls

attend meetings of the Board of Directors and express opinions as

at meetings of the Board of Directors. In addition, external Audit

necessary.

& Supervisory Board members regularly receive reports on audits

104 Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

Relationship between Supervision and Audits by External Directors or External Audit & Supervisory
Board Members and Internal Audits, Mutual Cooperation between Audit & Supervisory Board
Member Audits and Accounting Audits and Relationship with the Internal Control Department

Hulic Co., Ltd. Sustainability Book 2022 105

Status of Accounting Audit
Name of Accounting Auditor

The Company enhances the effectiveness and efficiency of audits through mutual cooperation and regular exchange of information among

Ernst & Young ShinNihon LLC

the Audit & Supervisory Board members, the Accounting Auditor, and the Corporate Audit Department.

The Company enters into an agreement with the Accounting

Company and the amount stipulated by law.

Auditor that limits liability for damages resulting from the neglect

The certified public accountants engage in Hulic accountingof duties based on Article 427, Paragraph 1 of the Companies

operations changes regularly based on the Certified Public

Act and Article 41, Paragraph 2 of the Company’s Articles of

Accountants Act, and auditors are engaged to conduct audits for

Incorporation. The maximum amount of liability under theno more than seven consecutive years.

Status of Audits by the Audit & Supervisory Board Members
Organization, Personnel and Procedures
Hulic is a company with an Audit & Supervisory Board, whichissues pointed out by the Accounting Auditor after receiving acomprises five Audit & Supervisory Board members (two arereport from an Audit & Supervisory Board member. The Audit &full-time auditors and three are External Auditor pursuant toSupervisory Board Office has been established to support the duties

Continuous Audit Period

the Companies Act and Ordinance for Enforcement of theof Audit & Supervisory Board members.

From 2003 onwards

Companies Act). In audit conducted by the Audit & Supervisory

Furthermore, the Audit & Supervisory Board members receive

Due to significant research difficulties prior to 2002, the period of continuous audits may exceed such period.

Board members, auditors monitor the operations of the internalreports on the results of audits performed by the Corporate Audit

control system and the status of its implementation through audit

Department and exchange information regularly to enhance

Policy and Reason for Selecting the Accounting Auditorof the execution of duties by directors, managing officers andthe effectiveness and efficiency of audits by both the Audit &When it is necessary to select a certified public accountant to・Appropriateness of audit fees

each division in accordance with the audit basic policy and theSupervisory Board members and Corporate Audit Department,

perform audits, the Audit & Supervisory Board examines and

The Accounting Auditor will be dismissed based on agreement

audit basic plan formulated by the Audit & Supervisory Board.

which performs internal audits.

confirms the following items through interviews and questions

among all Audit & Supervisory Board members when they have

These audits consist of attendance at the Board meetings as well

Note that Shigeo Nakane, Full-Time Audit & Supervisory Board

with the certified public accountant and an exchange of opinions

judged that there is a reason for dismissal as provided for in Article

as other meetings and committees when required, interviews

member, has served as Executive Managing Officer, Generalwith business execution divisions before making a comprehensive

340, Paragraph 1 of the Companies Act. The Audit & Supervisoryon the execution of duties by directors and managing officers,

Manager of the Accounting Department of the Company, and that

judgment.

Board determines the proposal for dismissal or non-reappointment

and reviewing important documents, approval documents andNobuyuki Kobayashi, External Audit & Supervisory Board member,・Status of quality controlof the current Accounting Auditor when it concluded that they areaccounting documents, etc. In addition, the Board responds

is registered as a certified public accountant. Both members have・Independence

not appropriate due to such reasons as violation of the Certified

promptly to any wrongdoing identified as well as deficiencies andconsiderable knowledge of finance and accounting.

・Expertise

Public Accountants Act, etc., and based on that decision, the Board

・Appropriate member configurationof Directors will submit the proposal at the general meeting of・Audit plan considering risk

shareholders.

Status of Activities by Audit & Supervisory Board Members and the Audit & Supervisory Board

Environmental Initiatives

agreement is the higher of an amount predetermined by the

Frequency of Audit & Supervisory Board Meeting
The Audit & Supervisory Board meets at an appropriate frequency and actively exchanges opinions on management issues of the Company

Evaluation of the Accounting Auditor by the Audit & Supervisory Board and Its Members

and important risks pertaining to accounting audits.

The Audit & Supervisory Board performed an evaluation of theof Group audits and fraud risk, after receiving a report on the

Accounting Auditor from the perspectives of quality control,

status of the audit quality from Ernst & Young ShinNihon LLC. As

Priority Audit Items of FY2021

independence of the audit team, exercise of professional distance,a result, it was determined appropriate to reappoint Ernst & Young・Achievement of priority issues at each department in the first year of the Medium- and Long-Term Management Planappropriateness of audit fees, effectiveness of communication with

ShinNihon LLC as the Accounting Auditor.

・Risk management mechanism for business diversification and internal control of the Groupmanagement and the Audit & Supervisory Board, and handlingSocial Initiatives

Auditing Mechanism

Corporate Governance

Auditing Mechanism

Our Approach to Sustainability

Corporate Governance Initiatives

・Sustainability Initiatives to achieve net zero CO2 emissions
Major Activities of Audit & Supervisory Board Members
・Regular meetings with the representative directors (approximately four times each year)
discussions at the Audit & Supervisory Board meetings through information sharing with full-time Audit & Supervisory Board members who

Data

・A
 ttendance at important meetings such as the meetings of the Board of Directors (External Audit & Supervisory Board members holdattend important meetings other than the Board of Director meetings and mutual confirmation based on interviews with key officers.)
・Review important approval documents, etc.
・Verify the effectiveness of the Group internal control system (full-time Hulic Audit & Supervisory Board members concurrently serve as Audit& Supervisory Board members at most of the affiliated companies, and in addition to conducting effective audits during the term, Group
Audit & Supervisory Board Liaison Meetings are held every three months. The Audit & Supervisory Board Members of affiliated companies

・E xchange information with accounting auditors (approximately 10 times a year; receive reports on the status of audit quality from the audit
firm, and address the independence of the accounting auditor, the status of quality control, the appropriateness of the job execution system,and the risk of fraud, and confirm the state of implementation of accounting audits of the auditing fiscal year.)・Cooperate with three-way audits (twice annually)

External Evaluationthat have full-time Audit & Supervisory Board Members share information on the status of risk management and issues at each company.)
・Collaborate with external directors (twice annually to exchange information on recent audits and topics.)

・Evaluate the effectiveness of the Audit & Supervisory Board (annually)

106 Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022 107

Internal Control System
System to Ensure the Appropriateness of the Company’s Operations and Operational Status of the System(JPY million, consolidated basis)

Category

FY2021Compensation based onCompensation based onCompensation based onCompensation based on

audit and attestation services

non-audit services

audit and attestation services

non-audit services

Hulic

52

9

62

36

Consolidated subsidiaries

45

1

50

―

Total

97

11

112

36

The Board resolves matters concerning the basic design and

the Companies Act, as a system to ensure appropriate business

operation of the internal control system specified in the provisions

operations of the Company, and promoting sound managementof the Companies Act and the Ordinance for Enforcement ofand business operations by enhancing internal controls.

System to Ensure the Appropriateness of the Company’s Operations① System for ensuring that the directors, managing officers, andemployees of our company and subsidiaries execute their duties while
they comply with laws and regulations, and the Articles of Incorporation② System for storing and managing the information related to the(FY2020)
Non-audit services at the Company were comfort letter preparation work related to issuing corporate bonds.

execution of duties of our directors③ System for the rules, etc. that are related to the management of

Non-audit services at the Company’s consolidated subsidiary were comfort letter preparation work.
(FY2021)

the risk of losses of our company and subsidiaries

Non-audit services at the Company were comfort letter preparation work related to issuing corporate bonds.

④ System for ensuring that the directors of our company andCompensation for Ernst & Young Member Firms⑤ System for reporting to our company about the execution ofsubsidiaries effectively execute their duties(JPY million, consolidated basis)

FY2020Category

duties of the directors, etc. of subsidiaries

FY2021Compensation based onCompensation based onCompensation based onCompensation based on

audit and attestation services

non-audit services

audit and attestation services

non-audit services

Hulic

―

―

―

5

Consolidated subsidiaries

―

6

―

3

Total

―

6

―

8

⑥ System for relating to the employees who are asked to support⑦ Matters relating to the guarantee of the independence of theabovementioned employees from the directors and of theeffectiveness of the orders given by the auditors⑧ System for having the directors, managing officers, as wellas employees of our company, and the directors, auditors,
managing officers, as well as employees of subsidiaries, or the
persons receiving a report from any of the abovementioned
persons report to our Audit & Supervisory Board and its
members and other systems for reporting to auditors⑨ Matters relating to payment for auditors for executing theirduties and other systems for ensuring that audits are effectively
carried out by the auditors

auditors' duties by the auditors

Operational Status of the System to Ensure the Appropriateness of the Company’s Operations
Compliance Initiatives
The Company established an annual compliance program（"theInitiatives for Ensuring Appropriate and Efficient
Business Execution(FY2020)

program") and confirms the status of progress through the

In addition to regular Board of Directors meetings held each month,Non-audit services at consolidated subsidiaries involved tax-related outsourcing and others.

Compliance Committee, which convenes four times a year. In

the Company also holds extraordinary Board of Directors meetings

the program, regular compliance training for employees andas required to ensure effective decision-making and the oversightNon-audit services at the Company involved tax-related outsourcing and others.

the distribution of compliance-related news ensure thoroughof business execution. We are also striving to ensure efficiency, for

Non-audit services at consolidated subsidiaries involved tax-related outsourcing and others.

compliance, including severing any ties with anti-social forces.

example by consolidating common operations in the Group to aCompliance training is also separately provided for officers.

shared service company.

(FY2021)

Compensation for Other Important Audit Attestation Services
None.

In addition, the internal reporting system or Compliance Hotline
ensures prompt detection and resolution of issues as well as toInitiatives to Ensure Appropriate Group Operations

protect the whistleblower. Reports are regularly made to the Board

The Company’s subsidiaries apply for approval and make reports

of Directors concerning the status of operations and reporting.

on important issues based on the Regulations for Business

Moreover, since FY2018, we added an independent outside contact,

Management of Affiliated Companies. Furthermore, the Corporate

the consent of the Audit & Supervisory Board in accordance with

Reasons the Audit & Supervisory Board Gave
Consent to Compensation of the Accounting
Auditoras well as one female manager as an internal contact, with the aim

Audit Department conducts audits with appropriate intervals andlaws and regulations and in consideration of such factors as the

The Audit & Supervisory Board performs necessary checksof improving the effectiveness of the internal reporting system.

Business Planning and Management Department regularly provides

size and characteristics of the Company and the number of days

regarding the details of the audit plan of the Accounting Auditor,

In FY2021, we provided information security measures and labor

guidance to the subsidiaries.

spent for the audit.

the performance status of accounting audit duties and the basis for

management training during working from home.

Companies that have recently become subsidiaries receive

Audit fees for the certified public accountant are determined withcalculating compensation estimates, and has given consent for thecompensation paid to the Accounting Auditor.

Data

Policy for Determining Audit Fees

Environmental Initiatives

FY2020Social Initiatives

Compensation for Audit by a Certified Public Accountant, etc.

Corporate Governance

Details of Audit Fees, etc.

Our Approach to Sustainability

Corporate Governance Initiatives

individual guidance on areas including risk management based on

Efforts to Manage the Risk of Losses

the Company regulations.

in risk by assessing the predetermined monitoring items. As for BCP

Initiatives to Ensure the Effectiveness of Audits
by the Audit & Supervisory Board Members

and conducts appropriate risk management in response to fluctuations

Status of Internal Audit
The Corporate Audit Department which reports directly to thesubjected to the audit.

preparedness, we review our Basic Plan for Business Continuity (BCP)The Company has an Audit & Supervisory Board, which meets once

President conducts internal audit from a position independent

Additionally, the Corporate Audit Department strives to enhanceand the BCP Manual. In addition, we conducted BCP drill in Novembera month in principle, to make decisions on, make reports, andfrom other business activities. It formulates internal audit basic

audits and improve the effectiveness of internal controls by

2021. This time, we used a remote meeting format, assuming that

discuss important issues related to auditing. In addition, the Audit

plan based on the Corporate Audit Regulations for the Board

reporting audit results to Audit & Supervisory Board members

some committee members could not come to work and communicate& Supervisory Board members ensure the effectiveness of audits byof Directors' resolution. Then the Corporate Audit Department

and accounting auditors, as well as exchanging opinions with

only with mobile phones due to a major earthquake, and confirmed

attending various meetings and reviewing the minutes of meetings.

systematically conducts internal audits in accordance with theeach other. The President, who oversees the Corporate Audit

how we respond in an emergency. Furthermore, we conducted

The Audit & Supervisory Board Office was established to create

internal audit basic plan and the results including findings are

Department, reports important matters related to the internal

separate drills (twice) aiming to better respond to earthquakes.

a system for promptly responding to requests from Audit &reported to the President. The feedbacks are also provided to those

audits regularly to the Board of Directors.

108 Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

The Company’s Risk Management Committee convenes every quarter

Supervisory Board members.

Hulic Co., Ltd. Sustainability Book 2022 109

Corporate Governance Initiatives

Fundamental
ApproachPursuant to the Basic Rules of Risk Management, we manage various risks related to the Hulic
Group's businesses, which include operational, market, liquidity, and credit risk, among others.

《Results in FY2021》 ●Number of Risk Management Committee meetings: 4 times●Number of Fund ALM Committee meetings: 16 meetings (12 regular meetings, 4 special meetings)●Number of BCP drills: 3 times●Number of inspections of stockpiled food: 4 times●Number of inspections of stockpiled goods: 1 time

Risk Management Structure

Our Basic Plan for Business Continuity defines the framework

working with industrial physicians

and method for continuing important business functions

to formulate response policies andwhile minimizing damage to business assets in the event of an

encouraging employees to work fromemergency, such as a metropolitan epicentral earthquake. We havehome (we expanded eligibility foralso created the BCP Manual outlining specific execution plansconventional work-from-home systems

and have thoroughly communicated the contents of the manual towhich were previously open only toofficers and employees.

employees providing childcare or nursing

Further, a portable Disaster Response Manual was prepared andcare). We also made efforts to reduce

distributed to all employees. This manual contains information

the risk of infection during commuting

on preparedness for disasters, procedures for using emergency

by staggering work hours and promoting

messaging service and safety confirmation system, as well as

web conferencing, implemented thorougha flowchart showing how to act when a disaster occurs while

infection prevention measures for each

Hulic recognizes that appropriately managing risks of the Company

In 2021, as the spread of COVID-19 increased volatility in markets,

commuting or during holidays.

employee and implemented a workplaceand its affiliates is one of its most important management

the Fund ALM Committee held 4 special meetings in addition to

Hulic implemented a variety of responses to COVID-19, including

vaccination program.

challenges, and has set up a structure with the Board of Directors

regular monthly meetings in order to closely monitor interest rates,

at the top while working to make improvements. The department

securities and other market risks, in an effort to flexibly respond to

Review and Improvement of the Basic Plan for Business Continuity

responsible for a particular risk stripe formulates risk management

each risk scenario.

Hulic reconfirms basic responses against disaster through annual

Furthermore, we analyze and evaluate the issues identified in the

BCP drill based on the Basic Plan for Business Continuity. The

drill, and work to build a more practical BCP system by reflecting

drill tests processes of establishing an emergency responsethese issues in a revised BCP manual.

is reported to the Risk Management

headquarters, verifies operation of the safety confirmation

We also established a cross-sectional cooperation with externalCommittee and Fund ALM Committee

system, and provides training on communication and information

organizations including design companies, construction companies,

regularly and as required by the department

gathering among other things. This serves to reaffirm the

management companies as well as elevator companies to ensurein charge with its recommendations. The

importance of business continuity for executives and employees as

continuity of real estate business.

Risk Management Committee and Fund

well as standards of behavior related to disaster countermeasures.

method, then appropriately monitor andcontrol risk. The status of risk management

Risk Management Structure Chart

As of March 23, 2022

Social Initiatives

Establishment of the Basic Plan for Business Continuity

Environmental Initiatives

Our Approach to Sustainability

Risk Management

ALM Committee, which convene regularly,
provided by the departments in chargeof risk management, assess overall risks
and discuss appropriate responses before
reporting to the Board of Directors. The
Board of Directors resolves importantmatters related to risk management uponreceiving reports from the Committees. We

BCP drill

Fire drill

An exhibit of emergency supplies

Corporate Governanceexamine the reports and recommendations

also verify that our affiliated companies are

Facilities and Stockpiles for Sustaining Business Operations

by requiring them to submit accurate andWe are proactively carrying out measures to strengthen the business continuity capabilities of our head office functions during an

pertinent reports on a regular basis. In theseemergency. The following measures have been taken at the Hulic Head Office Building.

ways, the Board of Directors has an oversight

1.Adopts earthquake-absorbing structures that enable building functionsof risk management of our Group.

to operate even during an earthquake with a seismic intensity of 7 level

Data

implementing appropriate risk management

2.Features emergency generators that can operate continuously for up to
six days

Business Continuity Initiatives for Disasters

3.Secures food and drinking water to last more than seven days

Hulic is a real estate company that engages in development,

safety, environmental performance, and convenience. We havereconstruction, and operation of office buildings etc. primarily

established various emergency and disaster scenarios for which wein Tokyo 23 wards. We are constantly working to generate newhave created measures to improve the structural performance ofadded value by offering properties that are superior in terms ofour buildings as well as operational and management aspects.
Emergency generator

110 Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

Business Continuity Approach for Disasters

Hulic Co., Ltd. Sustainability Book 2022 111

Fundamental
Approach

Hulic has established Basic Stance outlining its approach for achieving Corporate Philosophy
and the Basic Principles of Corporate Conduct, which clarifies the Basic Stance. Additionally, theCompliance Manual, which reflects changes in business environment and social trends, stipulates
actions that must be followed commonly in the Hulic Group in everyday business execution. As
the basis for promoting compliance, we are inculcating Compliance Manual to all employees.
Each and every employee will strive to fulfill the trust of every stakeholder and fulfill Hulic's
social responsibilities by complying with applicable laws and regulations, and company rules aswell as engaging in business activities based on a high standard of ethics.

《Results in FY2021》 ●Compliance trainings for all officers and employees
Number of trainings conducted: 5 times
Number of dissemination of compliance news: 12 times

Compliance Promotion Mechanism
way to build an effective compliance system that matches theCompany-wide system composed of the Board of Directors at theCompliance Rules set by each company. Hulic receives applications

top, the Compliance Committee, the senior executive managing

and reports on a regular basis and, as required, on the status of

officer in charge of compliance, and compliance officers of eachcompliance at each company, which improves our understanding

department. In addition, affiliated companies under managementof the situation and enables an appropriate response, whenby the Company are monitored and managed in a centralized

necessary.

Board of Directors

Compliance Program

The Board of Directors makes decisions on the issues discussed at the

The Compliance Committee formulates a compliance program as anCompliance Committee and receives reports from the Committee regarding

implementation plan to promote compliance, on a Company-wide basis. The

important matters for compliance.

results of the program are reported to the Compliance Committee. Moreover,affiliated companies create compliance programs in the same manner andAs an earthquake-resistant initiative, Hulic is working on

development building from earthquake-absorbing, earthquake-development, reconstruction, new acquisition and seismic

damping and earthquake-resistant structures. Additionally, we also

reinforcement of buildings which aim to build a leasing portfolio

stockpile water, set up a drainage system, and install emergency

year, in principle.

of 100% highly earthquake-resistant buildings. Our earthquake

back-up generators that can generate power continuously for

The Committee deliberates on important matters related to compliance, such as

resistance standards, stricter than those in the Building Standards

three days in our buildings. On the other hand, we also conduct

Act, are adopted for all the buildings we develop and reconstruct,

the necessary seismic reinforcement and screening to maintain the

including offices, commercial facilities, hotels, Japanese-style inns,

strength of its buildings other than we develop and reconstruct toresidential homes, and others. Our standards ensure building

a level that can withstand earthquakes of seismic intensity 7 level.

performance that can safeguard human life and enable continued

With regards to the responses against COVID-19,we confirmed

use of the building with post-earthquake repair in the event of

the status of infections at building management companies andan earthquake with a seismic intensity of 7 level. In addition, webuilding tenants in buildings owned by Hulic in collaboration

ensure that its new office buildings meet the highest earthquakewith Hulic Building Management Co., Ltd. in an effort to avoid

resistance standards by equipping them with the most suitable

standstills in building management operations and prevent thestructure type we adopted for the various conditions of the

spread of infection among tenants.

WEB

Compliance Committee

report progress and achievements to the Company.

Headed by the President, the Compliance Committee convenes four times arevisions to the Compliance Rules and the Compliance Manual, and formulationof a compliance program. The Committee also identifies and makes decisions
to improve compliance, including information management.

Compliance Promotion Framework

Data

Earthquake Resistance Performance of Buildings

In accordance with the Compliance Rules, we have built aEnvironmental Initiatives

Compliance

Social Initiatives

Diagram of Hybrid Structure Model

Corporate Governance

Maintaining Functions during a Disaster(Hulic Head Office Building)

Our Approach to Sustainability

Corporate Governance Initiatives

Framework for Collaboration and Cooperation with Related Parties and Business Partners
https://www.hulic.co.jp/en/sustainability/social/dealings/#anc4

In November 2013, Hulic's business continuity framework

and business continuity programs. At the same time, Hulic received(highlighted above) was recognized with a DBJ BCM rating froma favorable loan based on this rating. This marks the first time thatthe Development Bank of Japan. The decision for the rating, thea company from the real estate industry has received the highest

highest from the Bank, praised Hulic for our disaster prevention

rating from Development Bank of Japan.

External Evaluation

Hulic was the First in the Real Estate Industry to Receive the Highest Rating of DBJ BCM

Summary of the DBJ BCM Rating:
The DBJ BCM rating was established by the Development Bank of Japan (DBJ) and recognizes companies with particularly noteworthy business continuity management*1 Assigned to each department to promote compliance(BCM). The rating is based on a comprehensive evaluation using tangible and intangible aspects of a company's BCM initiatives, including its ability to quickly restore*2 Assigned to each department to assist the Compliance Officer

operations following a natural disaster.

112 Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022 113

Conduct, the Compliance Manual stipulates the following items

1.Respect human rights and prohibit

Our employees are encouraged to report directly to the internal

discrimination and harassment

or external Compliance Hotline when they consider it unlikely

Targets

that appropriate corrective actions will be implemented after

Officers and employees (including temporary and/or part-time staff,

as rules for promoting compliance by all officers and employees of

2.Comply with laws and rules

the Group.

3.Conduct business in a faithful and fair manner

In addition, we make sure that everyone understands the

4.Manage information appropriately

Compliance Manual and actively puts the principles into practice

5.Adhere to insider trading regulations

by providing compliance training and disseminating compliancerelated information.

etc.) and retirees who have retired within one year and employees ofthey consult with the compliance officers of their departments

business partners.

on matters involving compliance issues, or when they are

Target matters

6.Avoid involvement with anti-social forces

uncomfortable consulting with compliance officers due to the

7.Be considerate of environmental conservation

nature of the issues involved.

the Whistleblower Protection Act, human rights violation, corruption,

8.Maintain and encourage the best communication possible

The direct report to the Compliance Hotline can be made on

bribery, non-compliance with labor issues, violation of applicable

9.Respect intellectual property rights

issues including human rights violation, corruption, bribery andlaws and regulations related to various harassments and violation of

10.Prohibit bribery, and rules concerning gifts and entertainments
11.Ensure transparency and reasonableness of transactions

In the event that violations of compliance including cases covered byCompany code of conduct are suspected.

harassments, etc. Compliance Hotline is made known to all Group

Whistleblower protection

employees through compliance training.

Reports can be made anonymously. The whistleblower’s privacy is

Reports received by the Hotline internal contacts will trigger a fact-

Compliance Training
We regularly provide training on themes that correspond with theand new hires as well as external training for newly appointed

Compliance Manual, including prohibiting bribery and handlingofficers, including at affiliated companies. In addition, in FY2021

gifts and entertainment, intellectual property rights, insider

we provided information security measures and labor management

trading, and severing all relations with anti-social forces to raise

training during working from home.

awareness of compliance among all employees. In addition to
training on themes in the Compliance Manual, we also provide
real estate industry-specific training on important themes andtraining. Other related training includes training for new recruits

Response when a report is madeby the external contacts (designated lawyers) will be handled by

When a report is made, we investigate the facts and respondthe lawyer-in-charge, who informs the internal contacts of thepromptly while giving due consideration to the privacy of thewhistleblower’s report, with the in-house contact conducting

reporter.

any necessary fact-finding investigations, the results of which are

When a report is made in writing or by e-mail, the Hotline willreported to the lawyer-in-charge. Based on the findings of thisFrequency:	Conducted 5 sessions (four times for all

investigation, the lawyer-in-charge will provide the whistleblower

employees, once for officers), dissemination ofreport.

about the process details and related matters. Reports received

Compliance Training Sessions in FY2021

hold discussions, as needed. We also provide compliance-related
news and Q&As once a month on our intranet to supplement therespected, and they will not be treated unfavorably because of thefinding investigation and provide feedback to the whistleblower

Environmental Initiatives

Pursuant to Basic Principles of Corporate Conduct and Code ofCompliance Hotline

promptly notify the reporter that the report has been received.
Subsequently, the whistleblower’s point of contact will consider thenecessity of an investigation in fairness and sincerity, and in principle,with feedback.

notifies the whistleblower of future measures.

Social Initiatives

Compliance Manual

Our Approach to Sustainability

Corporate Governance Initiatives

compliance-related news 12 times
No. of participants: All employees (including temporary staff)

General Manager of Human Resources Department, Joint General Manager of Human Resources Department, General Manager of Legal &Compliance Department (Chief Compliance Officer); an additional female manager contact was added in 2018

When a compliance issue (or suspected) is detected, such asmeasures and report to the Company.

External contacts:

violation of applicable laws and regulations or Hulic’s code of● Compliance violations regarding Hulic businesses andAttorney’s offices; additional legal firm was added aside from our legal counsel

conduct, the issue is immediately reported to a complianceservices and means of transaction (FY2021): 0 incidents

officer or to the department in charge of compliance and the・N umber of violations of laws and regulations and payment ofsenior executive managing officer in charge of compliance by afines: 0 incidents

compliance manager. The facts are investigated as necessary and・N umber of violations or suspected violations of Hulic Company

necessary measures are taken to determine the causes and prevent

rules: 0 incidents

recurrence. Hulic Group companies also implement the similar

All Group companies have established report reception systems similar to the Company.

Compliance through Outsourcing Contractors
As for outsourcing by the real estate business division, we have

performance and their ability to execute operations, themade fair trades based on “rules for real estate outsourcing

effectiveness of their business execution system and the clarity ofmanagement,” respecting relevant laws and regulations as well as

the procedures, the appropriateness of the operation management

instructions by administrative organizations.

system, possible relationships with anti-social forces, and other

When selecting an outsourcing contractor, we make aitems.

Data

Treatment of Compliance Violations

Corporate GovernanceInternal contacts:

comprehensive decision by carefully checking their past

The Compliance Manual states that no anti-social activities will

implementation at the organizational level, and a range of

be tolerated and that all relationships with anti-social forces

measures have been introduced to severing any ties with anti-social

must be severed. As a concrete measure to promote severing

forces, including creating inhouse procedures, effective ways to

any transactions with anti-social forces, we established Rules for

ensure employee safety, and coordination with specialist externalCounteracting Anti-social Forces, which we are now practicing.

organizations.

In addition, the Legal & Compliance Department promote

114 Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

Severing Ties with Anti-Social Forces

Hulic Co., Ltd. Sustainability Book 2022 115

Corporate Governance Initiatives

Our Approach to Sustainability

ensures transparency, complies with applicable laws and the spirit of the law, and pays
taxes appropriately and fairly in all countries where we do business.

《FY2021 Results》 ●Political contributions: none

●Expenses for corruption related fines, penalties or legal settlements: none
●Number of employee reprimands or dismissals due to actual or suspected corruption: none

Tax Payment Policy
Hulic considers compliance to be one of its most important

ensures the transparency of transactions, including tax affairs,

We also strictly prohibit any bribery and clearly define prohibited

corruption and bribery.

management matters, complies with applicable laws andand in accordance with the spirit of law, pays taxes appropriately

activities specifically that lead to corruption and bribery in

Moreover, twice a year, we monitor whether each department

regulations and the spirit of the law, and engages in sincere andand fairly in all countries where we do business. Further, we will

the section prohibit bribery, and rules concerning gifts andis appropriately receiving business entertainment and gifts, andfair corporate activities that do not go against social norms. In

build relationships of trust with tax authorities in each country

entertainments of the Compliance Manual. In addition, we

confirm no bribery is accepted or received, and then identifies andline with our Compliance Manual based on the “Basic Principles

by increasing tax transparency without using tax planning or tax

conduct compliance training for all employees as appropriate toassesses the associated risks. In case of doubt, anyone can makeof Corporate Conduct” and “Our Code of Conduct,” Hulic

havens intended to avoid taxes.

build their awareness on prohibited activities such as giving gifts toa report to the Compliance Hotline. Once received, all reports are

public officials and excessive entertainment and make sure that ourhandled swiftly and appropriately.

employees are communicated of Hulic's policy on prohibition of

Initiatives for Fair Competition
We are thoroughly committed to our initiatives to ensure the transparency and rationality
Fundamental
Approachof transactions to make sure they are appropriate and fair so that no transaction harms
the interests of the Company or shareholders, or provokes any concern.

The Hulic Compliance Manual stipulates the following specific matters regarding the establishment of a fair competitive order.
●C ompliance with all applicable laws and regulations and internal

Board of Director Oversight
Financial reports such as the Company's consolidated financial

accounting auditor. Additionally, Audit & Supervisory Board

statements are submitted to the Board of Directors for approval inmembers receive reports and the Board of Directors responds

accordance with laws and regulations and the Company's Articles

promptly when the accounting auditor discovers fraud, or points

of Incorporation after they have been audited by an external

out inadequacies or issues including our tax affair.

Audit
Ernst & Young ShinNihon LLC conducts audits of the financial statements and internal controls as an Independent Accounting Auditor.

Tax Payments by Country●C ompliance to the arm's length transaction principles

Currently, our business and investment activities in countries otherand the United States. The Group's business bases are located only●P rohibition of the provisions of benefits to shareholders

than Japan are extremely limited, thus tax payments by Hulic Co.,in Japan. The amount of taxes paid by country was as follows.

●C ompliance with antitrust laws and related regulations●R espect for intellectual property rights

Ltd. (non-consolidated), by country in FY2021 was 100% in Japan●P rohibition of bribery, and excessive entertainment and gifts●A ppropriate information management

rules

●P
 rohibition of conflicts of interest

Environmental Initiatives

including public agencies such as the government and local government.

Hulic considers compliance to be one of its most important management matters. Hulic
Fundamental
ApproachSocial Initiatives

Hulic prohibits any act or suspicious act that leads to corruption with business partners,

Hulic Co., Ltd. (non-consolidated)(JPY million)

FY2019FY2020

FY2021

Japan

28,956

31,271

23,956

The U.S.

5

3

7

28,961

31,27423,963

Total

Corporate GovernanceFundamental
Approach

Tax Transparency

External Evaluation* Total current income taxes and deferred income taxes were counted.

Data

Initiatives for Anti-corruption

116 Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022 117

Corporate Governance Initiatives

Fundamental
Approach

We recognize that it is our social responsibility to effectively protect our information assets.
To protect these assets from various threats, we have established an information security
management system, and are ensuring that we operate and manage information assets
carefully based on information management rules that include rules on handling information.

Hulic categorizes information assets according to their importance

Information Security Management System

Fundamental
Approach

We strive to ensure appropriate and timely disclosure of information, and actively conduct
briefing sessions on financial results as well as investor meetings for individual investors. These
represent our efforts to achieve diverse forms of mutual communication.

Information Disclosure Policy

and usage, managing them appropriately to ensure confidentiality,

In accordance with the Disclosure Policy, we are aiming at fair,so that investors are able to understand more of our businessintegrity and availability.

timely and accurate information disclosure for shareholders andactivities. We also promptly disclose information which we believe

Specifically:

investors in order for them to make investment decisions.

to be helpful for the investors to make investment decisions on the● Organizational security control measures to appropriately implement andNot only to comply with relevant laws and regulations, we actively

Company’s website, although they are not applicable to the timely

disclose management strategies and financial information, etc.

disclosure rules and relevant laws, etc.

promote information management● Human security control measures such as education and training for employees,
regular inspections and audits, etc.
● Physical security control measures such as appropriate access control● Technical security control measures to ensure the appropriate management of
information assets
Confidentiality:Ensures only authorized persons can access information assets
Integrity:Protects the accuracy and completeness of information and processing
methods
Availability:Ensures authorized users have access to information assets when needed

Shareholders Return
We consider appropriately returning to our shareholders as a

Medium- and Long-Term Management Plan, we are targeting amanagement matter. Our basic policy is to provide stable dividends

dividend payout ratio of around 40% by FY2022. The dividend

payment based on our business performance trend. Under the

payout ratio in FY2021 was 38.5%.

In full respect of the importance of protecting personal information

to any claims or concerns regarding the handling of personal

we properly handle personal information in compliance with theinformation, and review and improve, as necessary, our provisions

Personal Information Protection Law (the "Privacy Law") and otherfor the handling and safeguarding of personal information.

To show our appreciation to shareholders for their continued

relevant laws and guidelines, and take appropriate measures to

We did not identify any substantiated complaints concerning

support, we annually present the gift of a gourmet catalog toensure that personal information is secure. We make efforts tobreaches of customer privacy and there were no significant

shareholders with 300 shares or more from which they can choose

conduct training and education for our employees so that personal

incidents or cases regarding leakage of personal data in FY2021.

an item equivalent to JPY3,000. For those with more than three

Corporate Governanceyears holding, we double the gift to two items worth JPY6,000 in
total from a catalog.

Privacy Policy
https://www.hulic.co.jp/en/siteinfo/privacy.html

Disclosure Controls
We strive to disclose material corporate information that may

on the opinion of the Disclosure Working Group. In such cases,

affect investors’ investment decisions in a timely, accurate, andthe Legal & Compliance Department, as the department infair manner, in accordance with the Timely Disclosure Rules

charge of management, strictly manages the information until

In addition to correspondences to shareholders issued semiannually,

recordings of the financial

stipulated by the Tokyo Stock Exchange, as well as related laws anddisclosure. The Business Planning and Management Department

we post the latest topics through the Investor Relations site of ourresults briefing sessions asregulations. In this regard, to promote an accurate understanding

serves as the secretariat for the Board of Directors and as thewebsite in a timely manner. E-mails are also sent to allow investors

we were unable to hold in-and evaluation of the Company by all stakeholders, including

department in charge of affiliate company management, andto receive information in more timely manner. Every time news

person briefing sessions inshareholders and investors, we have established Rules for Disclosure

works with Group departments to gather information. If such

about the Company is released, we send registrants by E-mail.

FY2021. When it becomesControl, as well as Rules for Insider Trading Management andinformation is determined to be material, the officer in charge of(Registration is available on our website.) In the financial results

possible to resume in-person

Information Disclosure Management. In addition, while operating

disclosure promptly reports it to the President and Representative

briefing session, we make efforts to provide easy-to-understandbriefings in the future, we

in a manner that clarifies where responsibility lies, the Company’s

Director, and after approval by the Board of Directors, the Legal &presentations by using PowerPoint visual materials. These briefing

plan to return to video

officer in charge of disclosure centrally manages material

Compliance Department, Corporate Communications & Investor

sessions (in Japanese and English) are also available either live or

distribution.

information regarding internal controls and financial information,

Relations Department, and other relevant departments handle theon recordings on our website. Moreover, we provided audio-only-

to ensure the comprehensiveness of information, as well as theprocedures for disclosure.

timeliness and the appropriateness of disclosure.

In the case of emerging facts, the Legal & Compliance Department,

Specifically, in the case of determined facts, material corporate

which obtains information from each department, works withinformation pertaining to resolutions of the Board of Directors andthe officer in charge of disclosure, and promptly reports to thesubsidiaries’ material information is consolidated

President and Representative Director if disclosure is deemedby the Business Planning and Management Department, and thenecessary, and the Legal & Compliance Department, Corporate

officer in charge of disclosure makes a judgment as to whether

Communications & Investor Relations Department, and otherthe relevant information is subject to timely disclosure, based

relevant departments handle the procedures for disclosure.

118 Hulic Co., Ltd. Sustainability Book 2022

Enhancement of Various IR Tools

Data

information is appropriately handled. We immediately respondWEB

Shareholder Incentives

External Evaluation

Privacy Policy

Dividend Payments and Payout Ratio
https://www.hulic.co.jp/en/ir/stock/dividend.html

Social Initiatives

WEB

Environmental Initiatives

Information Security Management

Our Approach to Sustainability

Initiatives for Shareholders and Investors

Hulic Co., Ltd. Sustainability Book 2022 119

Selected as Indices on ESG Efforts

The 92th ordinary general meeting of shareholders was held atunderstand way, using image materials, etc. The childcare nursery

Hulic has continuously been selected in five indices as a company

governance (ESG). The Government Pension Investment Fund (GPIF)

Hulic Head Office on March 23, 2022 with attendance of a lot

in the Head Office was opened to shareholders in order to enable

who took excellent initiatives on environment, social anduses these five indices as benchmarks of ESG investments.

of shareholders. In an effort to enliven the general meeting of

those with children to take part in the meeting without worry. We

shareholders, invitations to the meeting were sent out early, andwill strive to have shareholders more understand Hulic throughwe set up an electromagnetic voting method. In this meeting,communication with them.

we tried to explain about our business activities in an easy-to-

Hulic among institutionaland fiscal year) are held semiannually by Hulic's top management

investors.

mainly for institutional investors. We also conduct many one-on-one

We suspended visiting

meetings in Japan, through which we visit individual institutional

our overseas institutional

investors to explain Hulic's business activities. Furthermore,investors and held online

we have proactively rolled out IR activities overseas, visiting

meetings instead in 2021

institutional investors in Europe, the U.S., and Asia, etc. Throughin light of spread ofthese activities, we endeavor to foster a deep understanding of

COVID-19.
Social Initiatives

Briefing sessions on financial results (at the end of the 2nd quarter

Environmental Initiatives

Briefing Sessions for Institutional Investors and Analysts

Briefing Session for Private Investors
We are proactively working on IR activities to make ourselves betterIR fairs and other events)

understood by individual investors. We participate in seminars andin 2021 in light of spreadfairs, etc. for individual investors to create opportunities for moreof COVID-19.

individual investors to learn about us. We will promote IR activities
that provide us with opportunities to communicate directly withindividual investors.
We suspended our briefing session for private investors (including

Disclaimer:● The inclusion of Hulic Co., Ltd. in any MSCI index, and the use of MSCI logos, trademarks, service marks or index names herein, do

not constitute a sponsorship, endorsement or promotion of Hulic Co., Ltd. by MSCI or any of its affiliates. The MSCI indexes are theexclusive property of MSCI. MSCI and the MSCI index names and logos are trademarks or service marks of MSCI or its affiliates.
● FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confirms that Hulic Co., Ltd. has been

independently assessed according to the FTSE Blossom Japan Index, and has satisfied the requirements to become a constituentof the FTSE Blossom Japan Index. Created by the global index provider FTSE Russell, the FTSE Blossom Japan Index is designed tomeasure the performance of Japanese companies demonstrating strong Environmental, Social and Governance (ESG) practices. The
FTSE Blossom Japan Index is used by a wide variety of market participants to create and assess responsible investment funds andother products.

Corporate GovernanceApproaches at General Shareholders’ Meetings

Our Approach to Sustainability

Corporate Governance Initiatives● FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confirms that Hulic Co., Ltd. has been

independently assessed according to the FTSE Blossom Japan Index, and has satisfied the requirements to become a constituentof the FTSE Blossom Japan Sector Relative Index. The FTSE Blossom Japan Sector Relative Index is used by a wide variety of market

Dataparticipants to create and assess responsible investment funds and other products.

External Evaluation of IR Activities
Hulic's website discloses timely and detailed information on
our various activities. In 2021, our website was selected as the“excellent website in overall ranking” in Nikko Investor Relations
our website won the silver prize in Gómez IR Site Ranking, andalso won the Commendation Award in Internet IR Award 2021 by
Daiwa Investor Relations Co., Ltd.

120 Hulic Co., Ltd. Sustainability Book 2022

External Evaluation

Co., Ltd.'s All Listed Company Website Ranking 2021. In addition,

Hulic Co., Ltd. Sustainability Book 2022 121

Unit

We will appropriately manage environment-related data and disclose information while executing environmentally friendly management.
We believe it is important to provide reliable information concerning our sustainability-related activities. As such, we received independent
assurance from an independent assurance provider. Indicators that have been assured are marked with “ ”.

2017

2018

2019

2020

2021

Number of properties

property

51

55

58

59

55

220

Water Consumption*

3

401

436

420

437

346

1,487

m3/m2

0.83

0.80

0.78

0.65

0.61

0.86

thousand m

Water consumption intensity

Greenhouse gas emissions

2016(t-CO2e)

2019

2020

2021

Scope 1

14,931

10,49011,369

Scope 2 (Market based)

25,067

18,52917,473

Subtotal Scope 1 and Scope 2

39,99729,01928,842

1 Purshased goods and services

18,30324,72324,497

2 Capital goods

20,73039,142

19,638

3 Fuel and energy related activities

6,597

5,132

5,238

—

—

—

2,276

2,296

1,419

Note: Figures marked with “ ” have been assured by an independent assurance provider.
*Beginning in FY2021, 220 of Hulic’s fixed assets are covered, excluding properties under development and land for lease. Note that the amount of hot spring water used at hot spring inns
is not included.
The boundary from FY2016 to FY2020 is properties with a total floor area of 3,000 m2 or more, excluding buildings where bank branch is the sole tenant, as well as sectional and sharedownership properties and real estate for sale.

Waste disposal(t)

Scope 32016

4 Transportation and delivery (upstream)
5 Waste generated in operations

Number of properties (property)
Waste thatCan beRecycled

Waste that
Cannot be
Recycled

2017

2018

2019

2020

2021

7

8

9

7

6

6

Paper

240

296

348

102

52

61

Bottles, cans, plastic bottles

28

29

80

76

37

36

Total

268

325

428

179

89

97

Other general waste

195

218

629

576

309

302

Industrial waste

61

68

109

149

104

103

Total

256

286

738

725

414

405

6 Business travel

244

251

194

7 Employee commuting

455

430

283

8 Upstream leased assets

—

—

—

9 Downstream transportation and distribution

—

—

—

Total of waste that can be recycled and wastethat cannot be recycled

524

611

1,166

904

502

502

10 Processing of sold products

—

—

—

Waste disposal intensity (kg/m2)

8.42

7.46

8.11

6.98

3.97

3.97

36,98488,28043,315

193

484

1,005

143,225

109,328

115,114

14 Franchises

—

—

—

15 Investments

—

—

—

Subtotal Scope 3

229,006

270,066

210,703

Total Scope 1, 2 and 3

269,004

299,085

239,545

12 End-of-life treatment of sold products
13 Downstream leased assets

Note: Figures marked with “ ” have been assured by an independent assurance provider.
The boundary is Hulic’s head office building and buildings where the head offices of Group companies are located.
From FY2020, we calculated total waste disposal at certain properties in the boundary by using weight conversion factors based on actual measurements.
The results increased from FY2018 as Porte Kanazawa, a large commercial building, has become subject to aggregation since.

Corporate Governance

11 Use of sold productsTechnical measures (such as longer life design, etc.) applied to reduce construction waste(property)—：Not applicable.
Note: Figures marked with “ ” have been assured by an independent assurance provider.

2020

2021

Number of properties

8

8

Implementation rate

100%

100%

Environmental Initiatives

Water consumption

Social Initiatives

Environmental Performance Data

Our Approach to Sustainability

Data

The percentage of properties completed in the given year that used technologies and measures that contributed to a reduction in waste as well as raw materials and other resources basedon the Hulic Guidelines for Longer Life.
We monitor this figure from FY2020 as KPIs.

Total energy consumption

Number of greening properties

2019

2020

2021

Scope1

262,247,523

204,332,023

212,257,609

Scope2507,869,906

395,386,960

391,691,676

Number of properties

2

6

11

4

8

8

Total

770,117,429

599,718,983

603,949,285

Number of greening properties

1

5

9

3

5

6

2016

2017

2018

2019

2020

2021

Note: Figures marked with “ ” have been assured by an independent assurance provider.
The number of completed properties in each year among those imposed with greening obligation (excludes real estate for sale).

Number of renewable energy systems installed in development and reconstruction projects
2016

2017

2018

2019

(property)

2020

2021

Number of properties

2

6

11

4

8

8

Number of renewable energy
systems installed in development
and reconstruction projects

3

4

6

4

3

8

External Evaluation

Note: Figures marked with “ ” have been assured by an independent assurance provider.

(property)

Data

(MJ)

The number of propaties installed renewable energy facilities completed each year.

122 Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022 1232021

We appropriately manage personnel performance data and disclose information.

property

10

4

7

9

SOx emissions

kg

1,620

60

142

826

NOx emissionskg

11,527

1,334

1,649

6,778

VOC emissions

kg

157

124

0

Number of employees (person)(non-consolidated)

0

Average annual salary (JPY million)
Average service period (years)

Raw material purchase amount

Number of properties

2019

2020

2021

Male/Female
Average
Male/Female

Average age (years)

2018

Total

Number of employees (person)(consolidated)*Figures are for developed and constructed buildings for which data were collected in each year.

Unit

Male/Female

Average

Average overtime (hours/per month)

2017

2018

2019

2020

2021

112/44

114/52

124/57

122/62

128/61

156

166

181

184

189

862

936

1,878

1,934

1,496

15.30

16.36

17.61

17.08

18.03

4.8/5.3

5.1/5.4

5.6/5.8

5.8/6.3

5.9/6.7

4.9

5.2

5.7

6.0

6.2

41.9/34.7

42.1/34.9

42.1/35.3

41.3/35.6

41.4/35.4

39.8

39.8

39.9

39.4

39.5

25.2

25.4

25.4

25.2

29.6

property

10

4

7

9

New graduates hired (people)

Male/Female

5/3

4/4

4/4

4/4

8/4

Steel purchased amountt

12,971

1,660

5,507

5,112

Mid-career personnel hired (people)

Male/Female

15/3

8/4

8/1

9/2

10/1

Concrete purchased amount

t

—

—

—

38,269Retention rate 10 years after hiring (％)*1

Male/Female

—

—

—

97.2/96.9

90.9/91.2

Pier purchase amount

3

m

353

58

106

261

Retention rate new employees (％)*2

Male/Female

100/100

100/100

100/100

100/100

100/100

Plywood purchase amount

3

m

1,397

270

204

552

2

3

2

3

10

1.3

1.8

1.1

1.6

5.3

Timber purchase amount

m3

1,146

299

335

375

57/8

65/12

71/18

70/22

76/22

Employment ratio of persons with disabilities (％)(non-consolidated)

6.16

5.74

6.09

6.71

7.38

Employment ratio of persons with disabilities (％)(Hulic and Group companies)*3

2.11

2.41

2.42

2.34

2.54

Percentage of employees who received medical checkup(％)

100

100

100

100

100

Rate of paid leaves (％)

78.3

77.0

78.5

75.5

81.5

2

6

6

4

2

Number of voluntarily resigned employees (person)
Ratio of voluntarily resigned employees (％)
Number of employees in managerial positions (person)(excluding executive officers)

Figures are for developed and constructed buildings for which data were collected in each year.
We monitor concrete purchased amount from FY2021.

Paper consumption
Unit

2016

2017

2018

2019

2020

2021

Number of employees who took childbirth leave (person)

Amount of paper recycled

kg

9,400

11,365

13,125

14,54015,60013,880Paper consumption perperson (Hulic Head Office)thousand

16

18

20

20

21

18

The scope is Hulic Head Office Building.

The operational status of corporate governance related to climate change

Number of employees who took childcare leave(person)*4

Male/Female

0/2

1/5

7/5

3/4

5/2

Rate of employees who took childcare leave (％)–Not
adjusted for leaves carried over to the next fiscal year–*5

Male/Female

0/100

100/100

116.7/83.3

75/10083.3/100Rate of employees who took childcare leave (％)–
Adjusted for leaves carried over to the next fiscal year–*6

Male/Female

0/100

100/100

116.7/100

75/10083.3/100

100

100

100

100

100

Ratio of employees returning to work after childcare leaves (％)(times)2020

Male/Female

2021

Number of employees with shorter working hours (person)

6

3

6

5

9

Number of employees who took day off for family care (person)*7

1

5

4

7

11

0

0

0

0

0

Number of times the Sustainability Committee engaged in climate change monitoring

1

1

Number of employees who took family care leave (person)

Number of reported times by the Sustainability Committee to the Board of Directors

―

2

114

86

133

111

158

Number of Environmental Advisory Council held

1

1

Number of employees who took day off for nursing care (day)(absorbed
previous nursing care leave)*7
Number of users of the subsidy system for daycare nursery fees (person)

31

31

23

34

38

Number of employees who took leave to take part in volunteer activities(person)*7

13

12

12

Number of stress checks conducted (people) / Percentage of employees
who received stress checks (%)—

135/95.7

164/94.7

177/94.7

171/94.0

Number of additionally obtained qualifications by employees in total

31

22

23

29

38

In 2020, we announced our support for the TCFD recommendations and have strengthened our governance mechanism related to climate change.

Violations of environmental laws and regulations·payment of fines

Violations of environmental laws
and regulations・payment of fines(unit)

2016

2017

2018

2019

2020

2021

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

(note)Figures marked with

0＊8

0＊8

Environmental Initiatives

2020

Social Initiatives

2019

Corporate Governance

Number of properties

2018

have been assured by an independent assurance provider.

(note)Data covers Hulic Co., Ltd. only (excluding the number of employees (consolidated) and the employment ratio of persons with diabilities (Hulic and Group companies)).
(note)Figures exclude transfers between Group companies. Seconded staff are included in figures for the number of employees who took childbirth leave, childcare leave, days off for child care,
employees with shorter working hours, and the number of employees who took leave to take part in volunteer activities.
*1 The retention rate for 10 years after hiring are for personnel who joined the Company during or after April 2011.
*2 The retention rate of new employees are actual results for the most recent three years.
*3 T he data covers Hulic Co., Ltd. and subsidiary companies that have been certified as affiliated subsidiary companies under the Act on Employment Promotion etc. of Persons with Disabilities.
*4 N umber of employees who took childcare leave：Number of employees who began taking childcare leave during the fiscal year
・If the acquisition period crosses fiscal years, include the figures for the fiscal year in which the acquisition start date occurs.
*5 R ate of employees who took childcare leave-Not adjusted for leaves carried over to the next fiscal year-：÷「Number of employees who began taking childcare leave during the fiscal year」
×100「Number of employees (or their spouses) who gave birth during the fiscal year」

External Evaluation

Unit

Data

Human Capital-related Data

Amount of emission of SOx, NOx and VOC from hazardous wastes

Our Approach to Sustainability

Data

*6 R
 ate of employees who took childcare leave-Adjusted for leaves carried over to the next fiscal year-：÷ Number「Number of employees who began taking childcare leave during the fiscal year」「
of employees who entered the period for childcare leave during the fiscal year」
×100*7 P er month totals are given for the number of employees who took days off for nursing care, employees who took childcare leave and employees who took leave to take part in volunteer
activities.
*8 T he number of employees who took leave to take part in volunteer activities was nil during FY2020・2021, as participation in volunteer activities was halted to prevent the spread of COVID-19.

124 Hulic Co., Ltd. Sustainability Book 2022

Hulic Co., Ltd. Sustainability Book 2022 125

Hulic has been selected for a constituent of the MSCI Japan ESG

of 50% in each of the global industry classification standards

independent assurance provider, KPMG AZSA Sustainability Co.,

Select Leaders Index and the MSCI Japan Empowering Women(GICS®).

environmental issues including climate change, working

Ltd.,. Indicators that have been assured are marked with “ ”.

Index (WIN) by MSCI Inc.

The MSCI Japan Empowering Women Index (WIN) is comprised

environment and human rights and contributing to SDGs are one

We will continue to disclose information on the progress of our

The MSCI Japan ESG Select Leaders Index is constructed byof Japanese companies, chosen from the largest 700 Japaneseof Hulic's material management matters. We believe it is importantsustainability-related activities to the stakeholders while strive toselecting companies assessed as outstanding in terms of ESG

companies by market capitalization, with a high level of gender

to provide reliable information concerning our sustainability-related

improve quality of disclosure using PDCA cycle.

evaluations from companies that comprise the parent index (MSCI

diversity in their workforces compared to sector peers classified by

Japan IMI Top 700 Index), aiming to achieve market capitalization(GICS®).

activities. As such, we received independent assurance from anExternal Evaluations
Included in FTSE4Good Index Series
Hulic has been a constituent company in the FTSE4Good Index

FTSE4Good Index Series
https://www.ftserussell.com/products/
indices/ftse4good

performance of companies demonstrating strong Environmental,

Disclaimer: The inclusion of Hulic Co., Ltd. in any MSCI index, and the use of MSCI logos, trademarks, service marks or index names
herein, do not constitute a sponsorship, endorsement or promotion of Hulic Co., Ltd. by MSCI or any of its affiliates. The
MSCI indexes are the exclusive property of MSCI. MSCI and the MSCI index names and logos are trademarks or service
marks of MSCI or its affiliates.

Social and Governance (ESG) practices.

Disclaimer: FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confirms that Hulic Co., Ltd.
has been independently assessed according to the FTSE4Good criteria, and has satisfied the requirements to become a

Included in S&P/JPX Carbon Efficient Index

constituent of the FTSE4Good Index Series. Created by the global index provider FTSE Russell, the FTSE4Good Index Series

Hulic has been selected as a constituent of the S&P/JPX Carbon

Accordingly, Hulic has been continuously included in all five indicesis designed to measure the performance of companies demonstrating strong Environmental, Social and Governance

Efficient Index, which was jointly developed and released in 2018selected by the Government Pension Investment Fund (GPIF) for(ESG) practices. The FTSE4Good indices are used by a wide variety of market participants to create and assess responsible

by S&P Dow Jones Indices and Japan Exchange Group (JPG).

ESG investment indices: FTSE Blossom

investment funds and other products.

The S&P/JPX Carbon Efficient Index is designed to measure theJapan Index, FTSE Blossom Japan Sector

performance of companies in the Tokyo Stock Price Index (TOPIX),

Relative Index, MSCI Japan ESG Selectwhile overweighting or underweighting those companies that

Leaders Index, MSCI Japan Empowering

have lower or higher levels of carbon emissions to the revenue and

Women Index and S&P/JPX Carbon Efficient

actively disclose information of carbon emissions.

Index.

Included in Blossom Japan Index Series
Hulic has been a constituent company in two indexes of theSR) focuses on companies selected by

FTSE Blossom Japan Index Series. Created by the global index

FTSE Russell that have outstanding ESG

company FTSE Russell, the FTSE Blossom Japan Index is designed

initiatives, which includes outstanding

as an industry neutral benchmark that reflects the performance

management attitudes toward risks and

The Nikkei SDGs Management Survey, a survey that has been

Survey replaced their Environmental Management Survey in whichof companies demonstrating strong environmental, social andopportunities of climate change.

conducted annually by the Nikkei, is designed to rate companies

we have been ranked 1st in the real estate/warehouse industry

that are aligning the Sustainable Development Goals of thefor nine consecutive years until 2019. The survey addresses from

United Nations to management of the companies and pursuingfour themes, i.e., SDGs strategy/economic value, social value,

corporate value increase by solving environmental, economic andenvironmental value and governancesocial issues through business activities. We have participated inand gather information by sending

the survey conducted in 2021 with the rest of approx. 850 listed

questionnaires to the participant

been independently assessed according to the FTSE Blossom Japan Index, and has satisfied the requirements to become aand non-listed Japanese companies and have received a 4-starcompanies and from publicly available

constituent of the FTSE Blossom Japan Index. Created by the global index provider FTSE Russell, the FTSE Blossom Japanrating (deviation value of 60 to 65). The Nikkei SDGs Management

data sources.

In addition, FTSE Blossom Japan Sector Relative Index (FTSE Blossom

WEB

FTSE Blossom Japan Index Series
https://www.ftserussell.com/ftse-blossomjapan-index-series-spotlight

Disclaimer: FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confirms that Hulic Co., Ltd. has

Datagovernance (ESG) practices in Japan.

Received a 4-star Rating in the Nikkei SDGs Management Survey

Social Initiatives

Series. The FTSE4Good Index Series is designed to measure theWEB

Corporate GovernanceTaking proactive actions against ESG-related risks such as

Our Approach to Sustainability

Included in MSCI Japan ESG Select Leaders Index and MSCI Japan Empowering Women Index (WIN)Third-party Assurance

Environmental Initiatives

External Evaluation

Index is designed to measure the performance of Japanese companies demonstrating strong Environmental, Social andGovernance (ESG) practices. The FTSE Blossom Japan Index is used by a wide variety of market participants to create andDisclaimer: FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confirms that Hulic Co., Ltd.
has been independently assessed according to the FTSE Blossom Japan Sector Relative Index criteria, and has satisfied therequirements to become a constituent of the FTSE Blossom Japan Index Series. The FTSE Blossom Japan Sector Relative index
is used by a wide variety of market participants to create and assess responsible investment funds and other products.

126 Hulic Co., Ltd. Sustainability Book 2022

External Evaluationassess responsible investment funds and other products.

Hulic Co., Ltd. Sustainability Book 2022 127

Received a 3 Star Rating and the Green Star designation from GRESBApproaches to DBJ Green Building Certification

Hulic received a 3 Star rating in the Global Real Estate Sustainability

existence with society as one of the basic

DBJ Green Building certification system is a program to comprehensively assess the building’s environmental

Benchmark (GRESB) Real Estate Assessment 2021. It also obtained

strategies in its Medium- and Long-term

performance, crime and fire prevention, user comfort and convenience, cooperation with stakeholders, etc. by thethe Green Star designation for seven consecutive years.

Management Plan, (ii) managing ESG-related

Development Bank of Japan Inc. Hulic obtained the highest certification of “5 Stars” for Hulic Head Office Building and

GRESB is a benchmark which was founded in 2009 mainly by a

KPIs/targets through identifying materiality,

three buildings in reconstruction projects including Hulic Shinjuku Building, and one building was granted “4 Stars.”group of major pension funds in Europe. This benchmark measuresand (iii) business operation with emphasis on

sustainability and performance of the real estate sector. Hulic

dialogues with stakeholders such as customers,

received a high recognition for its progress in (i) implementing

business partners and the local communities.

was established and is operated by Ecosystem Conservation Society-Japan. Hulic carries out efforts to conserve and restore
local vegetation as part of its reconstruction projects for Company-owned properties from the standpoint of safeguarding
biodiversity. Our approach to biodiversity and many projects have received the JHEP certification.

initiative)* as consistent with levels required to meet the goals of
the Paris Agreement.

* Science Based Targets initiative (SBTi)
A collaboration between CDP, the United Nations Global Compact, World Resources Institute (WRI) and the World Wide Fund for Nature (WWF), and is an international initiative that
promote private sector to develop GHG emissions reduction targets in line with Paris Agreement (long-term temperature goal is to keep the rise in mean global temperature to well
below 2°C and limiting below 1.5°C above pre-industrial levels), then validate and approve targets submitted to them. For approval, GHG emissions need to comply with GHG Protocol
accounting and reporting standards, and near-term reduction targets need to be set between 5 and 15 years from the date of target submission to SBTi.

Received "Platinum Kurumin" and "Kurumin" Certifications
In regard to the support for raising the next generation, Hulic aims at a higher level than the legal
requirements and has established various in-house measures. We are working to develop a work
environment in which employees can take childcare leave more easily in addition to providing economic
support to employees who take the leave. In recognition of our efforts, Hulic has received a certification of“Platinum Kurumin” from the Minister of Health, Labour and Welfare as the Company supports employees
in raising the next generation at a distinctive level. We also received “Kurumin” certification (in 2010, 2017 and 2020).

Received New Energy Foundation Chairman’s Award
In recognition of our efforts to achieve RE100 by 2024 and to

The goals are to further promote theachieve 100% renewable energy by 2030 at all Company-owned

adoption, spread, and awareness of new

properties*, which we are promoting to realize a decarbonizedenergy, along with the recognition for

Certified as Health & Productivity Management Outstanding Organization(Small and Mediumsized Enterprises Category)society, we received the New Energy Foundation Chairman's

our outstanding achievement.

Hulic was certified as a Health & Productivity Management Outstanding Organization in 2021 (Small

Award at the 2021 New Energy Awards, along with Hulic Property
Solutions Co., Ltd. and ADVANCE CO., LTD.
The New Energy Awards, organized by the New Energy Foundationand supported by Japan’s Ministry of Economy, Trade and Industry,
looks widely for the application of products related to new energy

WEB

Converting to a 100% renewableenergy sourced electricity for electricity
consumption at all Company-owned
Buildings
https://www.hulic.co.jp/en/
sustainability/ecology/warming/energy.
html#anc6

as well as activities to adopt and raise awareness of new energy.
*All Company-owned buildings: Excludes properties for which we do not have energy management authority including master lease properties, residential properties andnon-managerial co-ownership properties, and real estate for sale.

CASBEE Assessments

and Medium-sized Enterprises Category) for the fourth consecutive year from 2019 in recognition of
our health and productivity management initiatives. The award has been promoted by the Ministry of
Economy, Trade and Industry in conjunction with the Nippon Kenko Kaigi to advance health and productivity.

Corporate Certification for Eruboshi Based on the Act on Promotion of Women’s Participation
and Advancement in the Workplace Obtained
As a result of the formulation of the Action Plan based on thesystem/ onsite childcare and nursery

Act on Promotion of Women’s Participation and Advancement infacilities), with the aim of ensuring that

the Workplace, Hulic attained the highest rank in the “Eruboshi”

female employees will be able to continueComprehensive Assessment System for Built Environment Efficiency“S,” in the CASBEE Real Estate Evaluations,certification presented by the Minister of Health, Labor andplaying an active role in the company after(CASBEE) is a method—researched and developed by the Japan

which assesses environmental performance in

Welfare in 2016, in recognition of the Company as an outstanding

childbirth and while parenting.

Sustainable Building Consortium—for extensively evaluating andbuildings that have been in operation for atcompany in the implementation of initiatives to promote female

Since we have been facilitating in creating a corporate culture

rating the environmental performance of buildings, districts, andleast one year since being completed.

empowerment at the workplace. We have put effort into creatingwhere employees respect the diversity among them and cancities, etc. from diverse perspectives. A certification (rating) is

Two of our office buildings, the Hulican environment where diverse human resources can performperform best, we were able to meet the criteria for the certification

provided based on the results of these evaluations.

Headquarter Building and Hulic JP Akasaka Building, also acquired(diversity management), especially into establishing a top-classestablished by the Ministry of Health, Labour and Welfare andHulic Logistics Kasai, our first logistics center proprietary developed“S” ratings, the highest for the CASBEE Wellness Office Evaluation,system for nurturing the next generations (a childcare support

obtain the highest rank certification.

and completed in May 2022, received an “A” rating in the CASBEE

recognizing the performance of these building and the hard work

Buildings (New Construction) Evaluation in recognition of ourneeded to maintain and improve employee health and comfort andcomprehensive environmental performance. Hulic Kasai Rinkai

to improve intellectual productivity when working, as well as safety

Building, located on the same site, attained the highest rating,and security.

128 Hulic Co., Ltd. Sustainability Book 2022

Recognized for Inclusion in Diversity Management Selection 100
Diversity Management Selection 100 is a commendation system

From the standpoint of empoweringrun by the Ministry of Economy, Trade and Industry since 2012, tofemale employees and helping employees

recognize companies of various sizes and from different sectors

improve their professional skills, Hulic is

for their proactive initiatives towards diversity management asworking to transform our organizationala contributing factor behind the economic growth of Japan. By

structure, develop an employee-friendly work environment, andcommunicating best practices, this aims to broaden the fields thatfurther enhance our benefit programs. We believe the achievement

encourage diversity.

was the result of our collective efforts.

Social Initiatives

WEB

Corporate Governancereduction targets approved by SBTi (the Science Based Target

Greenhouse Gas Emissions
Reduction Targets
https://www.hulic.co.jp/en/
sustainability/ecology/warming/roadmap.html

Data

Hulic has had its near-term (by 2030) greenhouse gas emissions

External Evaluation

Approved by The SBT Initiative

Environmental Initiatives

Approaches to JHEP Certification
JHEP is a program to evaluate and certify activities that contribute to conservation and restoration of biodiversity, which

management that emphasizes sustainable co-creation and co-

Our Approach to Sustainability

External Evaluation

Hulic Co., Ltd. Sustainability Book 2022 129