Basic Policy for Responsible Investment Management

NOMURA ASSET MANAGEMENT
Responsible Investment Committee
November 1, 2023

1. Basic Principles for Responsible Investment
The mission of NOMURA ASSET MANAGEMENT ("NAM" or "we" hereafter) is to continuously offer
our clients high-quality asset management services to meet the needs of our clients, thereby contributing
to the development of society and gaining strong trust through the asset management business.
Based on its fiduciary duties (i.e., the duty of an investment manager to give highest priority to customer's
interests) as a fiduciary asset manager, NAM is committed to act at all times in the best interest of ourclients based on our expertise with care required to carry out the duties. We ensure that conflicts ofinterest are handled ensuring independency and in such a manner so that client interests will never bedamaged.
We have been entrusted with our clients’ proxy rights and other rights on securities investment, as wellas with securities transactions. We must properly exercise these rights in an effort to maximize theinterests of our clients. We cannot achieve the growth of our clients’ assets over the medium to long term
unless investee companies achieve sustainable growth and create corporate value. To this end, we arecommitted to performing stewardship-related activities, including purposeful dialogue with investees(engagement) and proxy voting, to assume the important responsibility as a fiduciary asset manager.
ESG issues are basic concerns to be addressed by companies to continuously engage in business activities
as a member of society and create corporate value. ESG considerations are integral to our investment
stewardship. Thus, in compliance with the ESG Statement, we will strive to have a dialogue with investee
companies to constantly identify how they address ESG issues and encourage them to properly take onthese challenges through stewardship-related activities. We will also reflect the result of such engagementin our investment decisions.
NAM understands and recognizes that the overall actions as stated above are practices to be performed
as a "responsible investor" as these actions will eventually lead to a virtuous cycle of investment and also
to the expansion of “the earnings power of corporations” and “the formation of national wealth” as wellas to the realization of a sound and sustainable society. From this perspective, NAM defines investment
involving these actions as “responsible investment” and will make active efforts to ensure such
responsibility. Our investment strategies include both active management and passive management, andwe see no difference between them in terms of responsible investment.
Note: ESG is an abbreviation for Environment, Society, and Corporate Governance.

12. Concrete Actions
NAM specifies concrete actions that help attain the basic policy for responsible investment:(1) Understanding Investee Companies•

Strive to deepen understanding on business model and strategy, business environment, business
management and other important conditions of investee companies.

•

When conducting fundamental research and analysis of a company, focus not only on financial
information, but also on non-financial information such their ESG practices and the background tocertain strategies and management philosophy.

•

Render investment judgments on asset management and perform stewardship-related activities, suchas engagement with investee companies which includes proxy voting, based on the deep
understanding of the company.

(2) Approach to Investee Companies•

In order for investee companies to enhance corporate value and achieve sustainable growth, stipulatethe "Ideal Form of Business Management of Investee Companies" (refer to [Appendix 1]) andencourage investee companies to realize it.

•

Stipulate "Basic Principles of Engagement" (refer to [Appendix 2]) and "Global Proxy Voting
Policy" (refer to [Appendix 3]) and give encouragement to investee companies from a fair andconsistent posture.

•

Reflect the status of engagement in proxy voting.

(3) Reflection in investment decisions•

Assess our investee companies’ initiatives to realize their ideal form of business management basedon our own standards from the perspectives of both risks and opportunities and reflect the assessment
results in our investment decisions.

•

Reflect the status of engagement and proxy voting in investment decisions.

•

Delegate the Investment Policy Committee to determine the corporate policy on divestment andexclusion from investment universe based on the ESG Statement.

•

Regularly monitor the investee companies' initiatives to realize their appropriate management
practices in order to understand the status of the entire investment portfolio.

(4) Control Conflicts of Interests•

Exercise due caution on the possibility of conflicts of interests to assume fiduciary duties and always
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give priority to client interests.
•

Establish a highly transparent system and processes in order to ensure independence and properly
control conflicts of interests.

(5) Collaboration and Outside Activities•

Properly perform duties on the understanding that collaboration with other institutional investors,
etc., and outside activities will help enhance efficiency to give encouragement to investee companies.

•

With regard to collaboration on individual projects, careful judgment should be made inconsideration of the duty of confidentiality.

•

Continue to collect information regarding responsible investment and reflect it in our business on an
as-needed basis.

(6) Information Disclosure and Accountability•

Properly fulfill the duty of accountability regarding our actions as a fiduciary asset manager throughinformation disclosure and reports to clients.

(7) Organization and Actions•

Establish and operate a proper organizational structure so as to promote the above actions in an
effective manner.

•

Foster our ability on responsible investment by securing experts and strengthening our initiatives.

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[Appendix 1]
Appropriate management practices of Investee Companies
NOMURA ASSET MANAGEMENT ("NAM" or "we" hereafter) stipulates the appropriate management
practices of investee companies in order for investee companies to enhance corporate value and achievesustainable growth, which is a driver of investment performance, and actively encourages investees
through stewardship-related activities.

1.

Proper Efforts on Environmental and Social Issues

We believe that making proper efforts on global environmental and social issues from the perspectivesof risk management and the pursuit of business opportunities will lead to increase in corporate value andsustainable growth. We also see such efforts as a prerequisite for a company to be accepted as a memberof the society. Examples of issues that we consider are particularly important and efforts on them thatinvestee companies need to make are as follows:(1) Basic policy: Establishment of a basic policy regarding the company’s efforts on ESG issues andestablishment of a system to promote and supervise the efforts;(2) Key issues (materiality): Identification of key issues by the management, responses to anddisclosure of risks that are identified as key issues (e.g., data security, product liability, etc., as wellas those listed in (3) through (7)), disclosure of business opportunities that are identified as key
issues;(3) Climate change: Verification of business portfolio and promotion of technological innovation to
respond to the climate change issue, information disclosure based on the final report published by
the Task Force on Climate-related Financial Disclosures (TCFD), which is consistent with the Paris
Agreement, setting of a net zero target for medium- to long-term greenhouse gas (GHG) emissions
and approval of or commitment to science based targets (SBTs), measurement of GHG emissions
and absorption including Scope 3 under the international standards for the accounting and reportingof GHG emissions, and introduction of internal carbon pricing;(4) Natural capital: Development of measures and goals for prevention of deforestation, marine
pollution, or air pollution, sustainable use of water resources, timber, or marine products, reductionof waste, and promotion of recycling;(5) Human rights: Development of a policy on human rights at investee companies that is consistent
with international norms, human rights due diligence or audits including supply chain, corrective
action and relief mechanism, and disclosure of due diligence results;(6) Human capital with diverse values: Strategies to improve and maximize the values of human capital,
setting a medium- to long-term target for the percentage of women among board members, senior
executives, or managers, developing a personnel system to enhance diversity, equity, inclusion, andthe sense of belonging (including measures to prevent employees from leaving employment due to4

a life event, provision of fair opportunities, measures to improve employee engagement, etc.), andcreation of a corporate culture that embraces diversity and inclusion;(7) Well-being society: Formulation and disclosure of a management plan (including research anddevelopment and market strategies) that incorporates the resolution of social issues, such as healthand safety, education and intelligence, and regional revitalization, and measurement and disclosureof progress toward the resolution of social issues, and(8) Cooperation with stakeholders, such as participation in initiatives that are related to the issues listed
above.
2.

Value Creation through Capital Efficiency

NAM believes that in order for investee companies to enhance corporate value and achieve sustainablegrowth, it is necessary for investees to create value that exceeds the cost of capital over the medium tolong term by utilizing capital efficiently under proper risk management and constructing a businessportfolio that has a high growth potential and is efficient. To this end, we consider that the following
efforts are particularly important:(1) To formulate a growth strategy and an investment plan to create value that exceeds the cost of capitaland to conduct proper progress management; To determine the cost of capital in due considerationof opinions of investors obtained through dialogue with them as well as stock price levels andchanges thereof;(2) To verify the business portfolio against the growth strategy and replace businesses in the portfolio
as necessary;(3) To sell assets that do not contribute to the creation of value that exceeds the cost of capital and, inparticular, to reduce cross-shareholdings;(4) To implement group governance to enable the optimal allocation of management resources, etc.; If
there is a listed company within the group, to regularly verify the reasonableness of maintaining a
listed company within the group; to properly manage the conflict of interest with generalshareholders; and to support the listed company’s efforts to strengthen corporate governance;(5) To properly manage the risks associated with businesses, etc.;(6) To implement a capital structure and shareholder returns that reflect (1) through (5) above; and(7) To properly disclose information about (1) through (6) above.
3.

Adequate Performance of Corporate Governance Function

We believe that it is necessary for a company to have sufficiently functioning corporate governance as aprerequisite for value creation through the efficient utilization of capital and proper efforts onenvironmental and social issues. We postulate the appropriate corporate governance to realize this asfollows:5

(1) The board consists of an adequate number of qualified and diverse members who have the ability
and experience, including those in the areas of management, finance, and ESG, for supervising theexecution of management and any conflict of interest with the management, controlling shareholder,or any other parties on behalf of shareholders and functions effectively.
(2) The audit committee, audit and supervisory committee or the board of auditors consists of qualified
members who are capable of auditing directors' operations on behalf of shareholders and functions
effectively.
(3) Committees relating to nomination and compensation have been established, each of which consistsof qualified and independent members and adequately fulfills the necessary roles and responsibilitiesin (4) and (5) below.
(4) Standards and processes to determine whether the replacement of senior executives is required havebeen established, and a succession plan in case of such replacement has been formulated.
(5) Compensation of senior executives is appropriate as their incentive and commitment for value
creation through the efficient utilization of capital and proper efforts on environmental and social
issues.
(6) The board of directors makes appropriate judgment from the perspective of the best interest ofminority shareholders on any transaction involving a conflict of interest or a fight for control of thecompany. In our view, as anti-takeover measures limit the rights of shareholders to buy and sellshares freely, they are unnecessary unless there is a risk that such a transaction or fight will
significantly impair corporate value and common interest of shareholders.
(7) The board of directors monitors environmental and social issues and business and other risks andoversees initiatives by senior executives, and corporate governance systems are in place to ensuresufficient internal control in terms of compliance and internal auditing(8) Business operations comply with laws and regulations, market rules, etc., and requirements of the
Corporate Governance Code, etc., are properly addressed.
4.

Adequate information disclosure and a dialogue with investors

NAM believes that it is important for companies to fulfill their accountability for the matters stated in 1.
through 3. To this end, we consider that the following efforts are particularly important:(1) To disclose information appropriately on a timely basis in compliance with relevant standards, etc.,
based on developments in national regulators and international initiatives and to obtain third party audits
or assurances as much as possible particularly for quantitative information;(2) To actively hold dialogue with each investor in order to appropriately reflect investors’ opinions incorporate management; and(3) If a company is found to have engaged in any activity that is materially harmful to corporate value,
it is important for the company to provide sufficient disclosure and explanations on investigations ofcause, clarification of where responsibility lies, and the formulation and dissemination of effective
recurrence countermeasures.

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[Appendix 2]
Basic Principles of Engagement
NOMURA ASSET MANAGEMENT ("NAM" or "we" hereafter) considers that engagement(constructive "purposeful dialogue") with investee companies is an effective way to fulfill its stewardship
responsibility, and we intend to do so proactively.
NAM believes that engagement should be held based on the deep understanding of investee companies
and their business environment. In this way, we will strive to grasp companies’ specific circumstances.
We then encourage companies to realize increase in corporate value and sustainable growth through theirappropriate management practices and properly manage their progress toward the realization of suchappropriate management practices through engagement. At the same time, we do not believe thatencouraging companies with management issues to improve them is the only method of engagement. We
believe it is also very important to reassure well-managed companies of our support as investors.
Because NAM’s operation underlies medium-to-long term investment based on thorough research andanalysis of fundamentals, we believe that medium-to-long term fundamentals are key to engagement.
However, we expect the contents of the dialogue with each investee company to vary depending on thebusiness environment and the companies’ specific business circumstances.
Based on the above principles, we set forth the basic stance on performing engagement as shown below,
with an intent to fulfill our stewardship responsibilities by deepening mutual understanding through our
day-to-day dialogue with investee companies:(1) Maintain an amicable and constructive stance when communicating with investee companies.
(2) Deepen understanding not only on financial information, but also on non-financial information of
the investee companies, which includes ESG issues, the background to certain strategies andmanagement philosophy.
(3) Exchange ideas and opinions with investee companies regarding capital efficiency.
(4) Exchange ideas and opinions regarding the cause and recurrence countermeasures in the event ofincidents that breach accepted standards and promote effective corporate management.
NAM will promote investee companies to create value and achieve sustainable growth through suchactivities. We will also reflect the status of engagement in our proxy voting and investment decisions.
There may be some cases where we receive material facts that have not been disclosed under the insider
trading regulations or information that has a risk of being considered insider trading in the course of
performing engagement. Such fact or information must, if received, be treated properly in accordancewith laws and regulations, applicable rules and internal rules.
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[Appendix 3]
Global Proxy Voting Policy
1. Policy for Proxy Voting
NOMURA ASSET MANAGEMENT (“NAM” or “we” hereafter) has the fiduciary duty (a duty to
manage our business activities in the best interest of our clients) to do our best to enhance returns for ourclients as an investment manager. To fulfill our duties as well as our role, we will encourage investee
companies to realize appropriate management practices (including initiatives directed at ESG issues) andthereby encourage them to enhance corporate value and achieve sustainable growth by engaging withthem and exercising our proxy voting rights in a proper manner based on this Policy we have established.
We also encourage investee companies to operate their businesses in the best interests of theirshareholders over the long term through our proper proxy voting activity.
(Note) ESG refers to environment, social and corporate governance. We place emphasis on ESG issues,
as they need to be considered in the context of corporate social responsibility and sustainability.
2. Proxy Voting Guidelines
When exercising proxy voting rights, we will vote for resolutions that are deemed to enhance shareholder
value, while voting against those that are deemed harmful to shareholder value. We do not exercise our
proxy voting rights solely as a means to address specific social or political issues, irrespective of theinvestment returns of the company.
When making a judgment on the exercise of proxy voting rights, we regard any misconduct, violation oflaws and regulations and rules of stock exchanges, or any act that is deemed questionable in view of
initiatives directed at ESG issues or social norms, as being harmful to shareholder value.
We closely examine voting resolutions that meet one or more of the conditions listed below. Where webelieve that a specific resolution is not in the best interest of shareholders, we will, in principle, decideto vote against the resolution.
(1) The company continuously reports sluggish business performance. Sluggish business performanceindicators that are considered when judging the exercise of proxy voting rights, include performancethat leads to a significant decline in the investment returns of the company, such as recording a deficit
for three consecutive years. Business performance is based on consolidated accounts. However, if
consolidated accounts are not reported, business performance is based on non-consolidated accounts.
(The same shall apply hereafter.)(2) The company accumulates a large amount of excess funds that are deemed not to be used effectively
and/or are not distributed to shareholders adequately.
(3) The company’s disclosure is considered inadequate and harmful to shareholder value.
(4) The auditor’s opinion on the issuer is qualified.

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(5)The composition and/or size of the company’s board of directors, or the composition and/or size ofits board of statutory auditors, audit committee or any other committee is deemed to be inadequate
and may harm shareholder value.
(6) Extraordinary resolutions that are deemed highly likely to harm shareholder value.
3. Positions on Specific Issues(1) Election of Directors
The board of directors is expected to consist of a diverse range of persons who are qualified for the
position with sufficient skills and experience and the capability to supervise the execution of the businesson behalf of shareholders.
If the company is found to have engaged in any activity that is materially harmful to shareholder value,or if the company’s business performance remains sluggish over a long period, or if any similar issue isfound with regard to the company, we will in principle vote against the election of directors who are
deemed to be responsible for such issues/activities. Also, if the investee company had been encouraged
by us to address the inadequacy in its initiatives to realize appropriate management practices pointed out
by us through engagement but failed to engage adequately in initiatives and is not expected to make
improvements, and if this is deemed to be hindering, or highly likely to hinder in the medium/long run,the enhancement of corporate value and sustainable growth, we will in principle vote against the electionof directors who are deemed to be responsible for such inadequacy.
(2) Election of Auditors
Auditors are expected to be qualified to audit the business on behalf of shareholders, and are also
expected to function adequately for that purpose.
Where the company is found to have engaged in any activity that is materially harmful to shareholder
value or if any similar issue is found with regard to the company in question, and an auditor is foundresponsible for any part thereof, or is deemed to have failed to fully perform his/her duties, we will voteagainst the reelection of the auditor.
It is desirable that outside auditors are independent of management. It is not desirable to have a board of
statutory auditors and an audit committee composed of outside auditors, all of whom lack independence.
We determine the independence of the outside auditors from a comprehensive perspective on whether
they are representatives of major shareholders, have received a large amount of income other than
executive remuneration from the company in question, and are related to other executive members.
Where a reduction in the number of auditors is proposed, there should be proper justification for such a
reduction.
(3) Election of Accounting Auditors
In principle, we will vote for the election of accounting auditors except where it is found that:·The accounting auditor has an interest in the company and lacks independence.
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·Excessive non-audit remuneration has been paid to the accounting auditor by the company.
·The accounting auditor has expressed inaccurate opinions on the company’s financial conditions.
(4) Executive Remuneration
It is desirable that executive remuneration plans are reasonable and are aligned with the long-term
performance of the company.
We vote against remuneration plans, if the company is found to have engaged in any activity that ismaterially harmful to shareholder value, or the amount of remuneration is inconsistent with or inequitablecompared to the company’s overall financial condition, or plans are deemed to substantially harmshareholder value. In particular, we will vote against resolutions on executive bonuses when there is asignificant decline in business performance, or when the bonus payment amount is found to be
unreasonably large in relation to past achievements and the current financial conditions of the company,or as compared with other competitors.
In particular, we will vote against resolutions on offering company stocks (including stock options) when
there is a significant decline in business performance, or when the value of stock remuneration is foundto be unreasonably high in view of past achievements and the current financial conditions of the company,or as compared with other competitors. In principle, we vote for stock remuneration plans when the terms
and conditions of the plan, such as eligibility and scale, are properly set forth for the purpose of
incentivizing executives. However, we vote against such plans when the terms and conditions of the plan,
including eligibility and scale, are deemed to be improper.
We will determine whether to vote for or against resolutions on the granting of stock remuneration to thecompany’s employees or outside parties by applying mutatis mutandis the rules on stock remunerationplans for executives mentioned above. We will require sufficient explanation on stocks offered to outside
parties in light of whether it leads to the enhancement of shareholder value.
(5) Retirement Bonus for Directors and Auditors
We will vote against resolutions on retirement bonuses for retiring executives when the company is foundto have engaged in any activity that is materially harmful to shareholder value, or when there is asignificant decline in business performance or share price, or when the amount of the retirement bonus
payment is found to be unreasonably large considering past achievements and the current financial
conditions of the company, or as compared with other competitors.
(6) Allocation of Dividends and Profits
In deciding on distributions to its shareholders, the company should ensure that such distributions are
consistent with its long-term investment plan and capital policies. In principle, it is desirable that excess
funds are distributed to shareholders.
While considering whether the company’s allocation of dividends and profits is consistent with its longterm investment plan and capital policies, we shall vote against allocation policies that are deemed to besignificantly inadequate and harmful to shareholder value.
10(7) Acquisition of the Company’s Own Stock
While we view the acquisition of the company’s own stock positively as a means to enhance shareholder
value, we would oppose such a resolution when it is deemed to be inappropriate for the sake of thecompany’s capital structure.
(8) Change in Number of Authorized Shares
When said purposes are inappropriate, NAM will in principle vote against a company’s proposed
increase in the number of authorized shares.
(9) Issuance of Preferred and Other Classes of Shares
We will in principle vote for resolutions if the purpose is deemed to be clear and appropriate, and theissuance of such shares is deemed not to harm the interests of general shareholders in consideration of
appropriate application requirements, the fairness of voting rights, beneficiaries and other relevant
matters. Otherwise, we would oppose the resolution in principle.
(10) Corporate Restructuring and Capital Policy (Mergers, Acquisitions, Sale/Transfer of Business,
Corporate Separation, Capital Increase, etc.)
We will vote for proposed corporate restructuring and capital policies, if they are deemed appropriate
after considering the contents of the respective resolutions, financial conditions (including premiums),
effects on shareholder value, basis and rationality of management judgment, fair disclosure, etc., froman overall perspective. Otherwise, we would oppose the resolutions. When general shareholders receive
a consideration, whether in the form of shares, money or otherwise, in relation to corporate restructuring
or capital policy, we would emphasize the appropriateness of the consideration when forming a judgment
on whether to vote for or against the resolutions.
(11) Anti-Takeover Measures
We individually analyze anti-takeover measures. We would oppose such resolutions unless shareholder
value is protected.
(12) Amendment of Articles
We will determine whether to vote for or against resolutions on amendments to the articles ofincorporation on a case by case basis from the perspective of the long-term enhancement of shareholder
value or the protection of shareholder value from impairment. We will vote for (against) such resolutions
if we find them appropriate (inappropriate) from these perspectives.
(13) Shareholder Resolution
We will determine whether to vote for or against shareholder resolutions on a case by case basis fromthe perspective of long-term enhancement of shareholder value or the protection of shareholder value
11from impairment. We will vote for (against) such resolutions if we find them appropriate (inappropriate)from these perspectives.
(14) Other
NAM will determine whether to vote for or against resolutions on any other issues on a case by casebasis from the perspective of the long-term enhancement of shareholder value or the protection ofshareholder value from impairment. We will vote for (against) such resolutions if we find themappropriate (inappropriate) from these perspectives.
4. Conflict-of-Interest Management Policy
We conduct business in good faith and consider the fair treatment of our clients, and we appropriately
manage conflicts of interest based on our “Conflict-of-Interest Management Policy.”
To manage the risk of a conflict of interest arising, we conduct our business in an appropriate manner bygiving first priority to the clients’ interests.
With regard to proxy voting, the Responsible Investment Committee which consists of members who are
independent of the investment division, is in charge of policy-makings and final proxy voting decisions.
In cases where we exercise proxy voting rights for securities issued by Group Companies and subsidiaries
or affiliates of Nomura Holdings Inc., and/or concerning the Group Companies’ interests, after making
such facts clear, we refer to opinions from multiple proxy advisors and make decisions at the Responsible
Investment Committee to protect the clients’ interests. The Responsible Investment Council validates
whether such decisions are adequate and if necessary may make a recommendation to the Responsible
Investment Committee. When receiving the recommendation, the Responsible Investment Committee
reviews the related proxy voting decision again and makes the final decision.
5. Other
NAM may be unable to vote or may decide to abstain from voting in certain circumstances. The following
list, although not exhaustive, highlights some potential instances in which a proxy may not be voted:(1) Securities Lending
When securities are offered for loan as of the record date of exercising a proxy vote, they need to becollected before exercising the vote. We may not exercise a proxy vote after considering the practical
implications of such an exercise and the cost incurred for collecting such securities.
(2) Share Blocking
Some countries and regions require shareholders to deposit their shares with a designated depository
during a specific period shortly before a shareholders’ meeting as a condition for exercising a proxy vote.
Shares cannot be sold during this blocking period. In such a case, we may not exercise the proxy votedue to practical considerations and the potential for opportunity loss.
(3) Re-registration

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In some countries and regions, re-registration of shares is required to exercise a proxy vote. We may
choose not to exercise a proxy vote in consideration of the fact that the shares cannot be sold during there-registration period.
(4) OtherFor example, when we are unable to obtain adequate information, e.g., if the period between receipt of
the resolutions and the exercise of voting is insufficient. Also, if the cost of voting the proxy outweighs
the possible benefit to the client, we may also choose not to exercise the proxy vote.

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