Responsible
Investment
ReportWe create economic
and social value
through the asset
management businessThis is the philosophy of Nomura Asset Management

About
NOMURA ASSET MANAGEMENT (NAM)
03 Our Strengths in Responsible Investment
05 Cooperation with Our Overseas Offices
07 CEO Message
09 NAM’s vision for the Investment Chain
10 NAM’s materiality
11 ESG Statement
17 NAM’s initiatives on PRI
19 Basic Policy For RESPONSIBLE INVESTMENT
23 Towards Realizing a Monitoring Board
25 Utilizing Human Capital
31 Initiatives on Human Rights
37 TCFD & NET ZERO GOAL BY 2050
43 NATURE & BIODIVERSITY
53 Our Product Governance Initiatives

01

Responsible Investment Report 2023

Engagement

Proxy Voting

59 Basic stance on engagement

77 The Unique Aspects of Our Proxy Voting

61 Measuring the Effects of Engagement Activities

78

62 Engagement on SBT
63Engagement Activities Targeting Human Rights Risk
Management, Utilization of Human Capital

64 Engagement Initiatives
65 Engagement Targeting Increased Board Effectiveness66 Fixed Income Engagement
67

Aiming to Improve the Capital Efficiency of JapaneseCompanies

68 Engagement Activities Targeting the Automobile Industry
70 Review of Priority Topics
71 Global Equity Engagement74 Engagement by Sustainalytics
75 Cooperation with Global ESG Initiatives

79808183

The Outline of Proxy Voting / System toManage Conflicts of Interest
Proxy Voting Process for Japanese andGlobal Equities
Changes in Results of Exercise of Voting
Rights for Japanese Companies
Overview of Proxy Voting Standards forJapanese Companies
Changes to Proxy Voting Standards forJapanese Companies

ESG Integration
89 Features of Integration
90 Equity Integration
91 Efforts to Advance ESG Integration
93 Impact Investing
99 ESG Scores for Japanese Equities
101 Green Bonds and Sustainable Bonds
103

NAM’s Systematic Approach to Sustainable Fixed
Income Investment

Disclosure of Proxy Voting Results

85 (Reasons for voting For or Againstproposals)

87 Proxy Voting FAQ

107 Messages from the Responsible Investment Council
111 Results of Self-Evaluation of 2023 Stewardship Activities
113 NAM’s ESG Communication Activities
114 Review of 2023, 2024 and Beyond

02

Our Strengths in Responsible Investment

1History ofResponsible Investment

Long-term commitment to responsible investment
Our company’s first strength is our long history of engaging in responsible
investment. The roots of the current Responsible Investment Committee
lie in the Proxy Voting Committee established in 2001. Subsequently, theESG Committee was established in 2011. The ESG Committee became
the Responsible Investment Committee as part of a reorganization and anintegration from 2014 to 2015. Based on many discussions over the years, andalways remaining conscious of our mandate from clients, we have fostered aculture that is supportive of responsible investment, respects diverse opinionsfrom a large number of professionals, and values lively discussion.

03

2022

2021

2020

Corporate
Sustainability Report2023 publishedSustainabilityDevelopment
Department andNet Zero Strategy
Department establishedEstablished NAM’smateriality Joined Net
Zero Asset Managers
initiative (NZAM)

Established AssetManagement

Formulated our ESG
Statement

Revised ESG Statement

2018

2004

2010

2011

2014

2015

2016

2017

Management of SRI
Index Fund commenced

UK Stewardship Codeadopted

ESG Committee(now the Responsible
Investment Committee)
establishedJapanese version of theStewardship Code adopted

Responsible Investment
Group and ESG
specialists established

Responsible Investment
Department established

Proxy voting results
disclosed individually

Conflict of Interest Management
Policy formulated and Responsible
Investment Council established
Stewardship Codes in Singapore,Hong Kong and Taiwan adopted

Malaysian Stewardship
Code adopted

ESG Committee
reorganized into
Responsible Investment
Committee
Proxy Voting Committee
reorganized into
Stewardship Committee

Systematic and Continuous ESG-related Initiatives
Our company’s second strength is our systematic and ongoing effort to address
ESG-related issues in anticipation of the needs and dynamics of the times.
Examples of our efforts include the establishment of the Responsible Investment
Committee as the highest decision-making body for responsible investment
and the Responsible Investment Council which supervises the Committee,
the establishment of policies including the ESG Statement, engagement andproxy voting in order to realize ideal form of business management of investee
companies, as well as providing information to stakeholders through disclosurematerials such as the Responsible Investment Report and the TCFD Report.
Furthermore, we have established a Sustainability Development Department
to accelerate our business operations with an emphasis on sustainability, andin 2023 we newly issued a Corporate Sustainability Report. We are also working
to strengthen our organizational structure with respect to ESG, including
establishing an Engagement Department to bolster our engagement with portfolio
companies and a Net Zero Strategy Department that is working to enhance ourefforts to address climate change.

Responsible Investment Report 2023

Support for TCFD.
Strengthening ourcompany-wide efforts totackle climate change.

Research Institute topromote ESG

2001

United Nationssupported Principles
for Responsible
Investment (UN PRI)
signed2019

Revised ESG Statement

Proxy Voting Committee
establishedManagement ofgovernance fundcommenced

22023

Stewardship Committee
integrated into
Responsible Investment
Committee

Self-evaluation
disclosed

UK Office acquired Tier1 evaluationfrom UK FRC*

Organizational Structure for Responsible Investment
Responsible Investment Council
Oversight,
verification,advice, etc.

Main activities
Dialogue withportfolio companies(engagement)

Proxy Voting

Responsible Investment Committee
Secretariat:
Responsible Investment Department

Forming policies,
oversight of initiatives,etc.

Reports onactivities, defineissues, etc.

Investment and research division

Integration into
investment decisions(ESG integration)
Collaborative/
public activities

3

Global Approach and Diversity
Our company’s third strength is our global and highlydiverse investment and research framework. Based on
our global platform for responsible investment, we havebuilt an ESG investment and research framework madeup of portfolio managers, corporate analysts and country
specialists who manage ESG products in our overseas
offices. Our team includes a large number of portfolio
managers, ESG investment managers, corporate analysts,
credit analysts and ESG specialists working in one of thelargest active management institutions in Japan, all ofwhom are committed to applying their analytical abilities
and insights to responsible investment.

LondonFrankfurt

DubaiShanghai
New York
Hong Kong
Malaysia

TaiwanSingapore

4

Inclusive Discussions based on
a Strong Organizational Platform
Our company’s fourth strength is our emphasis on having “exhaustivediscussions” that incorporate diverse opinions under a strong organizational
platform. The Responsible Investment Council was established as a bodyto oversee discussions of the Responsible Investment Committee in realtime. The majority of the Council is consists of highly independent outside
directors and outside experts in order to manage conflict of interest. It
manages conflicts of interest with highly-independent outside directors
and outside experts accounting for a majority of its members. In addition,
the Responsible Investment Committee comprises members possessing
abundant investment and research experience. The Committee held a totalof 14 meetings in 2023. The discussion at the Commitee often heats up overthe decision on proxy voting and ESG related issues. The members of theCouncil observes the Committee meetings not only to monitor the conflictsof interest but also to actively join the discussion.

TokyoSydney

Responsible Investment Committee Meetings

January – December 2023

147times

Responsible Investment
Committeetimes

Regular

4 times

Regular

4 times

Ad hoc10 times

Ad hoc3 times

Responsible Investment
Council04

Cooperation withOur Overseas Offices
ENGAGEMENT

Cooperation With Overseas Offices
At Nomura Asset Management, we work globally to strengthen our ESG initiatives
based on our global platform for responsible investment.
By utilizing this common platform, we are not only able to promote ESG
initiatives at each office, but offices can also share detailed information with oneanother.
Our ESG Statement is shared globally, and allows for a common understandingof the goals behind our ESG-related activities as well as ESG-related issues (referto Pages 11-16).

Nomura Asset Management
Stewardship CodeSigning Status

UK*JAPAN

HONG KONG

Dec. 2010

May 2014

Sep. 2016

SINGAPORE

TAIWANMALAYSIA

Sep. 2016

Dec. 2016

Apr. 2017* In March 2022, Nomura Asset Management UK was approved by the Financial Reporting Council(FRC) as a signatory to the UK Stewardship Code 2020.

05

Responsible Investment Report 2023

We engage in constructive dialogue with companies about important financial and nonfinancial risks and opportunities in accordance with our basic policy for engagement (referto Pages 59-70). Specifically, our ESG specialists, ESG investment manager, engagement
managers, company analysts and country specialists based in Japan and overseas offices
collaborate to engage with portfolio companies.
We monitor the details of the engagement of managers in each country with target
companies using common milestone management tools, which allows information to be easily
shared among our offices. With respect to climate change, which is one of our key engagement
themes, we urge portfolio companies to receive SBT approval, and by monitoring the status ofthese efforts on a global level we are able to check how much progress companies are making.
Furthermore, ESG officers in overseas offices can now easily hold discussions with our ESG
specialists in Tokyo about engagement details. (Refer to Pages 71-76)

PROXY VOTINGESG INTEGRATION

For proxy voting (excluding Japaneseequities), we generally decide to votein favor of or opposition to an issue inaccordance with our Global Basic Policyon Proxy Voting. However, if the portfoliomanagers and analysts possessing adeep understanding of local conditions
determine it to be necessary, we may,upon deliberation, make a decision thatdiffers from the basic policy on proxyvoting. The final decision is then sharedwith all offices, and proxy voting is thencarried out uniformly on a global basis(refer to Page 79).

In terms of integration, climate change analysis
tools are used to evaluate the climate changerisks and opportunities for portfolio companies
and for each fund (refer to Pages 29-39), andin addition to sharing our ESG scores among
all offices, ESG data from external sourcesand other data are incorporated and used tomake investment decisions. The details ofengagement with companies whose stocks ourfunds hold are shared with portfolio managers
and utilized in discussions about whether tocontinue holding the stocks in question (refer toPages 89-106).

TokyoFrankfurt

UK/EU

E
SGT

AT I O N

GR
TE

VO

GES

GIN

N

A
N

A

M

ANP

N

P R OX Y

Singapore

SG

Portfolio ManagerNPME

A

M

ASIA

P

A

AG E M E N
GNTResponsible
Investment GlobalPlatform

IN

PM

ELondonP
M

NE
SGA

M

TOKYOP

Hong Kong/Malaysia/Shanghai

Research professional (company analyst, credit analyst) Quantanalyst (quant analyst, financial engineer)

New YorkESGUSA

ESG specialist, ESG investment manager,
Engagement manager

06