COMFORIA RESIDENTIAL REIT
第21期（2021年1月期）決算説明資料

Sustainability
Report 2021
2021年3月

Contents

About this Report

Introduction
Top Messages

3

About CRR

4

Sustainability Policy / Structure for Promotion
Sustainability Initiatives

9

Materiality

11

Topics17

External Certifications / International Initiatives

18

Environment
Environmental Performance

20

Environmental Considerations

21

Considerations for recycling-oriented society

22

Establishment the Environment Management
System(EMS)

23

Urban Site Investment Criteria

24

Green Building Certification

25

Green Bonds

Comforia Residential REIT, Inc (“CRR”) and TLC REIT Management Inc.
(“TRM”) to which CRR entrusts its asset management, are making the best
effort to disclose information related to the sustainability initiatives to theinvestors and other stakeholders. Within this scope, this report is issued toillustrate the ESG (E: Environment, S: Society, G: Governance) initiatives at
CRR and TRM which are essential to contribute to a sustainable society.

Coverage on this report
PeriodFrom August 2020 to July 2021 (excl. some data)

Entities

CRR and TRM

Issued date

October 25, 2021
Contact

Dept.

Comforia Management Division, TLC REIT Management Inc.

26

Address

Shibuya Solasta 18th floor, 21-1 Dogenzaka 1-chome,
Shibuya-ku, Tokyo, Japan

Stakeholder Engagement

29

E-mailinfo_comforia@tokyu-trm.co.jp

Employee Engagement

30

Initiatives to Local Communities

38

Initiatives to Tenants

39

Initiatives to Suppliers

41

Initiatives to Investors

43

Society

We communicate also using the Global Reporting Initiative (GRI) Sustainability
Reporting Standards, an international sustainability framework for ESG-related
reporting. About the GRI Standards, please refer to page 56.

Disclaimer

Governance
CRRʼs Corporate Governance46

TRMʼs Corporate Governance49

Initiatives for Governance Emphasizing
Unitholders’ Value54

GRI Content Index

56

Independent Assurance Statement

72

CRR and TRM do not guarantee or warrant the accuracy and safety of theinformation provided in this document, and shall not be liable for updating
the information provided.
Please be advised that forward-looking statements provided herein may besubject to change or deletion without prior notice.

Introduction
Top Messages
From Executive Director of CRR

Takehiro Izawa
Executive Director
Comforia Residential REIT, Inc

First of all, we would like to offer our heartfelt sympathy to everyone who has been
affected by COVID-19, as well as their family members and other loved ones, andexpress our gratitude to all the healthcare professionals and other essential workers
devoting their efforts to fighting the pandemic. We hope that our daily lives will return tonormal as soon as possible.
Since our establishment, under the basic policies of “investments in residential
properties with high growth potential” and “utilization of the Tokyu Fudosan Holdings(“TFHD”) Group”, CRR has achieved internal and external growth by focusing ourinvestment in assets located in the 23 wards of Tokyo where has a strong demand forrental residences.
In the meantime, we have witnessed changes in social structure and lifestyle in Japan,such as decrease in population caused by declining birthrate and aging population;
migration of younger generations to metropolitan areas; change in residential preference
from ownership to renting; and the government-led workstyle reform.
In recent years, demand for corporations to respond to such social issues has increased,considering that these issues and changes may become a risk factor for corporate
business continuity. Triggered by the adoption of Sustainable Development Goals(SDGs) by the United Nations, the recognition that management focus on ESG(Environment, Society and Governance) will contribute to the enhancement of thecorporate value, has been widespread.
In light of this trend, our asset management company TRM established their
Sustainability Policy in April 2019 as their basic approach towards contributing to thedevelopment of sustainable society. We have created and issued this report for the
purpose of providing a comprehensive tool that may be used to gain more in-depth
knowledge of CRR and TRM’s aforementioned Sustainability Policy and ESG-related
initiatives. We hope that it will help our unitholders and other stakeholders understandour efforts.
CRR and TRM will continue fulfilling our social responsibilities by improving oursustainability initiatives, which we hope will strengthen the relationship of mutual trustthat we have built with our stakeholders.
3About CRR
Overview

Based on the Investment Trust and Investment Corporation Act (Act no. 198 of 1951 and subsequent revisions; hereinafter referred to as the “Investment Trust Act”),
CRR was established on June 8, 2010, as an investment corporation that mainly invests in real estate provided for residential use. We completed registration by theprime minister of Japan under Article 187 of the Investment Trust Act on June 30, 2010 (registration number: Director of Kanto Finance Bureau no. 71) and started
operation in August 2010. Subsequently, CRR issued new investment units based on a public offering on February 6, 2013, and was listed on the Tokyo Stock
Exchange’s Real Estate Investment Trust Securities Market (security code: 3282). When we began operation, CRR’s assets under management were 11 properties
with a total acquisition price of 15,5 billion yen; since then, as a result of steadily acquiring and selling properties based on the basic policy concerning assets undermanagement stipulated in our articles of incorporation (i.e., to manage assets with the aim of securing stable income and achieving steady growth of assets undermanagement in the medium to long term in order to maximize unitholder value), the number of assets we owned had reached 140 by the end of July 2021, with a totalacquisition price of 261.5 billion yen.
Name

Comforia Residential REIT, Inc (TSE:3282)

Address

21-1 Dogenzaka 1-chome, Shibuya-ku, Tokyo

Representative

Executive Director, Takehiro Izawa

Fiscal Period

Six-month period from Feb.1 to Jul.31, and Aug.1 to Jan.31

Structure
Sponsor

CRR

2

TOKYU LAND CORPORATION
Comforia Residential REIT, Inc

6

Asset Management Company
TLC REIT Management Inc.

1

Unitholders’ Meeting

Asset Custodian
General Administration(operation of the administrative instruments)
Transfer Agent
Mitsubishi UFJ Trust and Banking Corporation

3

Board of Directors

General Administration (accounting, etc.)
Reiwa Accounting Holdings CO.,Ltd

7
Executive Director: Takehiro Izawa

Supporting Companies

Supervisory Director: Koji Yamamoto

4

Supervisory Director: Masamichi Ohshima
TOKYU LIVABLE, INC.
TOKYU COMMUNITY CORP.
Tokyu Housing Lease Corporation
National Students Information Center Co., Ltd.
TOKYU E-LIFE DESIGN Inc.
EWEL, Inc.
TOKYU SPORTS OASIS, Inc.

AuditorErnst & Young ShinNihon LLC

General Administration(tax)
Reiwakaikeisha(“RWK”)Tax Corporation

5

General Administration(Corporation Bonds)

Sumitomo Mitsui Trust Bank,Limited
MUFG Bank, Ltd.

❶Asset Management Agreement ❷Asset Custody Agreement / Administrative Service Agreement / Transfer Agency Agreement ❸Accounting Service Agreement❹Tax Administrative Agreement ❺Fiscal, Issuing and Payment Agency Agreement ❻Sponsor Support Agreement ❼Support Agreement

4About CRR
Basic Policies
We invest intensively in rental residences for singles and small families, mainly in the Tokyo metropolitan area, based on our basic policies of “investments in residential
properties with stable earnings and high growth potential” and “utilization of TFHD Group,” with the aim of ensuring stable earnings over the medium- to long-term andmaximizing our unitholders’ value.

COMFORIA Series
We will invest in and manage rental residences, fully utilizing the concept and expertise of the urban rental residence COMFORIA series, which Tokyu Land Corporation
has produced.

Value Chain of TFHD GroupWe have concluded sponsor support agreements, support agreements and property management agreements for managed assets with TRM and TFHD Group
companies to fully utilize the value chain and expertise of TFHD Group. With the support of TFHD Group companies through such agreements, we aim to expand ourasset size (external growth), and maintain and increase asset value (internal growth).

5

About CRR
Portfolio Management Policy
Investment Target Primary target: Maintain over 80% investment ratio of “Rental Residence” generating stable earnings.
 Sub-target: “Operational Rental Residence” with services likely to attract demand (i.e. senior residences, serviced apartments and student apartments.)

Asset Type

Investment Target

Investment ratio(acquisition price base)

As of
Jul.31,2021

Rental residence

80%～100%

96.6%

Operational rental residence

0%～20%

3.4%

Residential property

Rental residenceOver 80%(Note) Investment ratio is based on acquisition price. In terms of land with limited property rights, calculations are based on the type of residential property built on the parcel.

Investment Area
 Maintain over 80% investment ratio of assets in “Central Tokyo”, “Sub-central Tokyo” and “Tokyo Metropolitan areas”, where there is strong potential demand forrental residences.

Category

Investment Area

Central Tokyo

5 major wards

Chiyoda-ku, Chuo-ku, Minato-ku,
Shinjuku-ku, and Shibuya-ku

Sub-central
Tokyo

Dense residential districts
outside of the 5 major wards

Other Tokyo wards (excluding
above)

Tokyo
Metropolitan
area

Dense residential districts in allother Tokyo Metropolitan areas

All other areas within Tokyo
Metropolitan boundaries expecting
strong demand

Other major
citiesDense residential districts in ordinance-designated cities

Investment ratio(acquisition price
base)

As of
Jul.31,2021

80%～100%

95.6%

0%～20%

4.4%(Note) Investment ratio is based on acquisition price. In terms of land with limited property rights, calculations are based on the area where the parcel exists.

Tokyo area
Over 80%6About CRR
Features and Strengths
Portfolio focusing on “Tokyo 23 Wards” and “Near Stations”
When investing in properties, CRR selects them carefully, based especially on our location strategy for rental residences, with a focus on Tokyo’s 23 wards where
there are strong rental needs. Moreover, we have strategically built up our portfolio by continuing to emphasize properties located near stations, with the closest station
just a few minutes away on foot. As a result, 91.7% of the rental residences in our portfolio were located in Tokyo’s 23 wards as of the end of July 2021, and theaverage time on foot from rental residences to the nearest station was 5.0 minutes.

Tokyo 23 Wards

Near Stations

Investment area (Rental Residence)

Average minutes on foot from the nearest stations(Rental Residence)

Other major Cities
4.6%

Tokyo Metropolitan Area
3.7%

Sub-central Tokyo
52.8%

Tokyo 23 Wards

Central Tokyo
38.9%

91.7%

Over 10 min
4.5%

5 to 10 min
37.5%

Avg. Minutes
on Foot

Under 5 min
58.0%

5.0minUtilizing Support from TFHD GroupCRR aims to steadily increase our asset size and maintain and improve our asset value by using the support of the TFHD Group. The proportion of our properties
acquired from the TFHD Group as of the end of July 2021 was 72.1% (based on the acquisition price). In addition, the average occupancy rate since our listing is
95.9% (as of the end of July 2021).
Ratio of acquisition from the sponsor group（as of the end of Jul. 2021）

72.1％

Average occupancy rate since listing（as of the end of Jul. 2021）

95.9％
7

About CRR
Continuous expansion in asset size and sustainability initiatives
CRR aims to steadily increase our asset size and maintain and improve our asset value by using the support of the TFHD Group. Furthermore, we have positioned
sustainability initiatives as one of our priority strategies and are pursuing various environmental and social initiatives.
Asset size（bn yen）

Eligible Green Projects（bn yen）

168.0

164.4

71.2

Listed(Feb. 6, 2013)

188.5

187.4

202.1

206.0

225.9

71.2

End of 6th FP（End of Jul.2013)

226.6

245.9

252.1

261.5

2 properties
certificated1 property
certificated1 property
certificated

24.3

29.9

33.5

33.5

13.2

13.2

13.2

13.2

13.2

13.2

13.2

End of 12th FP（End of Jul.2016)

End of 13th FP(End of Jan. 2017)

End of 14th FP（End of Jul.2017)

End of 15th FP(End of Jan. 2018)

End of 16th FP（End of Jul.2018)

End of 17th FP(End of Jan. 2019)

End of 18th FP（End of Jul.2019)

End of 19th FP(End of Jan. 2020)

End of 20th FP（End of Jul.2020)

End of 21th FP(End of Jan. 2021)

End of 22th FP（End of Jul.2021)

September 2018GRESB Real Estate
Assessment on its First
Participation

April 2019
Establishment of
Sustainability Policies

September 2019
Acquired GRESB Real
Estate Assessment
Green Star ,GRESB
rating 3 Stars

July 2020
For the first time for
CRR of issuing green
bonds(1.5 bn yen for 10 years)

September 2020
GRESB rating 2 Stars

April 2021
Setting rules forsustainability promotion
framework

First to Receive the Highest Rank in the Residence Editionof the DBJ Green Building Certification

Acquired GRESB Real
Estate Assessment
Green Star ,GRESB
rating 2 Stars

Sustainability
Initiatives

Identification ofMateriality

May 2019
Inclusion in MSCIJapan ESG SelectLeaders Index

July 2021
Issuing green bonds(3.0 bn yen for 10 years)
August 2020
Change in
Asset Management
Fee System

COMFORIA SHINJUKUEASTSIDE TOWER

Aligning interests
between unitholders and the sponsor
Feb. 2016
Acquired 3,970 units

Establishment of
Sustainability Department

As of the end of July 2021⇒

Sponsor’s investment ratio9.0％（62,264 units）
Feb. 2019
Acquired 5,384 units

Feb. 2020
Acquired 3,079 units

Feb. 2021
Acquired 2,137 units

8

Sustainability Policy / Structure for Promotion
Sustainability Initiatives
TRM recognizes the impact of environmental and social considerations, and that of strong governance, and as a member of TFHD Group, shares TFHD Group’s
Sustainability Vision. TRM believes that tackling these issues is a social responsibility, realizes our management philosophy, and contributes to the development of asustainable society. The Sustainability Policies are established hereunder to implement the beliefs of TRM.
Sustainability Policies

Established April 1, 2019

1．Environmental Considerations
TRM will consider energy efficiency, decarbonization, water efficiency, and waste reduction as four major items in the operation of each investment corporation, andpromote our initiatives by applying these items to each environmental policy.
2．Efforts for Employees（1） TRM will improve employees’ sustainability knowledge, promote enlightenment activities for that purpose, implement capacity building to allow personnel to act
professionally and become more productive, provide training for human resource development, and support the acquisition of qualifications.
（2） TRM will promote efforts to improve the way employees work in light of the policies and practices of the entire Group and by closely sharing information in TRM.
3．Collaboration with External Stakeholders（1） As a member of the local community, TRM will enhance relationships with customers, such as tenants and facility users, and the local community throughimprovements in disaster prevention and BCP measures, contributing to safety and security.
（2） TRM will promote programs and procurement with environmental and social considerations through engagement with tenants and suppliers, including property
management companies.
（3） By means of the effective use of the expertise in real estate and other fields owned by TFHD Group's affiliates, TRM will be committed to improving customer
satisfaction while continuing to create value through each investment corporation.
4．Legal Compliance and Risk Management
TRM will comply with environmental, social, and governance laws and regulations as well as pay close attention to and appropriately respond to legislative changes.
For risk assessment upon real estate acquisition, TRM will work on risk management in an appropriate manner, taking into account environmental and social impacts.
5．Information Disclosure
TRM will strive to disclose information on our sustainability efforts to investors and other stakeholders.

9Sustainability Policy / Structure for Promotion
Promotion System
To enhance TRM’s efforts towards the issues related to environmental or societal consideration, etc. based on its Sustainability Policy, the rules on the Sustainability
Promotion System require that the President & CEO to be the Chief Sustainability Officer and each department appoint one responsible person from the department.
The Sustainability Promotion Council is to be held with the President & CEO as chairperson.
Sustainability Department was established as of April 1, 2021 to expand the functionality of the Sustainability Promotion System. The Sustainability Department
succeeds the ESG-related missions from the Environmental Engineering Department, and we will further promote our sustainability program.

Sustainability Promotion Council
The Sustainability Promotion Council meets regularly with President & CEO as the Chief Sustainability Officer who assumes the ultimate responsibility, and othermembers from across the organization of company and among members, we share relevant information and examine and promote the efforts. External experts areinvited to the Council to consult opinions when needed.

Members of the Sustainability
Promotion Council

Chairperson

President & CEO

Regularmembers

Director, Chief Division Officers of the Comforia Management Division, Activia Management Division, andBroadia Management Division, Corporate Management Division, General Managers of Environmental
Engineering Department, and Sustainability Department, Compliance Officer

Organizer

Sustainability Department

Meeting frequency

Every quarter in principle

Main issues to be discussed

・Amendment and abolishment of the Sustainability Policy
・Amendment and abolishment of the Materiality
・Matters related to, and common to TRM and CRR・Annual activities planning, report on status

10

Sustainability Policy / Structure for Promotion
Materiality
As a member of TFHD Group, TRM recognizes the key issues (the “Materiality”) identified by TFHD Group and has identified its own materiality by extracting significant
medium- to long-term societal issues based on the tasks which CRR has been working on such as environmental issues. The Materiality has been shared with CRR.

Identification process
Materiality was identified by select cross-divisional members of TRM.

Step1

Awareness and organizationof societal issues

In preparing discussions for Materiality, societal
issues related to CRR and TRM were extracted byreferencing TFHD Group Integrated Report;materiality; GRI Standards; relevant SDGs; ESG
assessments for the real estate sector; and issues
recognized by the industry association.

Integration andconsolidation of issues

Step2

With respect to the above stated societal issues, amateriality short list was created after summarizing
the tasks which CRR and TRM has been working on,
and discussing topics that should be given higher
significance, with additional consideration to risks
and opportunities regarding each issue.

Step3

Reflection of opinions fromofficers and employees

All officers and employees were asked to offer
opinions as stakeholders of TRM, and preliminaryinterview was conducted with executive officer andsupervisory directors of CRR.

High

Step4 Identification of materiality
Materiality

Based on the interview results, significance ofeach issue to be addressed by CRR and TRM
was reviewed for appropriateness.
Materiality was identified by the Sustainability
Promotion Council and reported to the board of
directors of TRM and CRR.

（Significant societal issues）

Significance of
impact on economy,society, environment

Significance to Stakeholders, CRR and TRM

High

11

Sustainability Policy / Structure for Promotion
SDGs with close relevance to the Materiality
The Materiality, which is shared between CRR and TRM, is identified by considering the impact from a view of risks and opportunities, and the significance for us to address.
Our aim is to contribute to the SDGs (Sustainable Development Goals) through our commitment to the Materiality.
Materiality

Reducing environmental
impactHuman capitaldevelopment
as a group of
professionals

Contribution to theregionRisks（Impact of not addressing materiality）

Increased physical risk from escalation of climate change(human damage, property damage, economic damage)Lack of sufficient skilled resources may hinder business
operation, leading to stagnant or lower unitholder value• Breakdown of communication with local community at timesof emergency such as disaster may cause reputational risk
• Risk of loss of liveliness due to the image of the invested
region becoming obsolete or due to population decrease

Opportunities（Business opportunities expected byaddressing materiality）

Relevant SDGs

• Share clear commitment to ESG investment with officers andemployees, providing opportunity for implementation andincorporation in our business strategy• Increased demand for leasing properties focused on
environmental performance
Each employee’s effort to further realize their abilities andmaintain mental health and stable living while fulfilling thefiduciary duty required of asset management business andworking towards our goal of maximizing unitholder value andenhancing our presence will create a positive cycle andimprove our performance.
Show presence by contributing to the safety and security of theregion and vitalization of local economy as a member of acorporate group committed to urban development

Contract renewal and repeated selection for relocation bytenants can be expected by creating safe, comfortable andpleasant space for tenants

Health and well-being of
tenants

Facilities with inferior ESG considerations may risk losing
support from tenants

Supplier engagement

Impact on management operation and deteriorated credit incase significant violation against sustainable procurement such Collaborate with suppliers to satisfy fiduciary duty required ofas discrimination, exploitation, destruction of nature,
asset management business and contribute to becoming thecontamination and violation of laws by suppliers are
REIT of choice by the investors
recognizedManagement framework
corresponding tomultifaceted social
demand towards
sustainable society

Inappropriate response to multifaceted social demands may
risk fall in trust concerning sound and effective managementbusiness and affect market development

Enhanced commitment to environment and society will further
promote establishment of medium- to long-term businessplatform, and improvement in financial value can be expected12Sustainability Policy / Structure for Promotion
CRR’s initiatives towards to each Materiality
Environment (E)Materiality

Reducing environmental
impactRelevant SDG Targets

PolicyStatus/Initiatives• Implementation of energy efficiency retrofits• Acquisition of environmental certifications/assessments, etc.
1.Energy use: Medium- to long-term target of 1% average annual• Efforts to improve waste management
reduction in energy use intensity.
• Introduction of green leases
2.Energy-related CO2 emissions: Medium- to long-term target of 1%• Monitoring by Sustainability Promotion Council
annual average reduction in greenhouse gas emissions intensity.
• Promotion of environment-friendly procurement through “Green
Procurement Standards”

7.3

By 2030, double the global rate of improvement in energy efficiency

12.5

By 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse.

12.8

By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development andlifestyles in harmony with nature.

13

Sustainability Policy / Structure for Promotion
CRR’s initiatives towards to each Materiality
Society(S)Materiality

Policy• Promote human resource strategy that indicates the requirements ofdesirable resources and facilitate development
Human capital development as• Commitment to health and well-being of each employee
a group of professionals• Deployment of measures based on Group KPIs (work-style reform,
promotion of diversity)

Status/Initiatives• Disclosure of key employee data to present our human resources strategy
and status of efforts on employee health and well-being (ratio of female
employees, number of female directors and managers, turnover ratio, stresscheck participation ratio, etc.)• Support acquisition of business knowledge, skills, qualifications, andimplement various trainings• Promote career development through periodic performance
evaluation/feedback• Periodic Health Committee• Introduction of various support systems leveraging on Tokyu Group
membership, etc.

1. Further improvement in disaster prevention functions
2. Prompt recovery of assets under management
3. Educational activities on fire and disaster prevention and disaster
response
4. Enhanced cooperation with local community• Capital expenditure from disaster prevention perspective• Public disclosure of evacuation sites/emergency reserves, etc.
• Relationship with local community （Corporation with local events, local
disaster prevention, disaster response and infectious disease prevention
etc.）

Health and well-being of
tenants• Improve tenant satisfaction• Check satisfaction via tenant survey and respond to comments by tenants• Distribute guide map on managed facilities• Deploy tenant service leveraging on group resources• Hold tenant participation events

Supplier engagement• Aim for smooth property management by utilizing expert know-how of
Tokyu Housing Lease, Tokyu Community, and other support agreement
counterparties in TFHD Group. Share information and actively work on
environmentally friendly procurement with PM/BM• Build and promote collaborative structure through periodic monitoring• Promote collaboration with all stakeholders through “Green Procurement
Standards”

Contribution to the region

11.3

By 2030, enhance inclusive and sustainable urbanization and capacity for participatory, integrated and sustainable humansettlement planning and management in all countries

12.8

By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development andlifestyles in harmony with nature

Relevant SDG Targets

14

Sustainability Policy / Structure for Promotion
CRR’s initiatives towards to each Materiality
Governance(G)Materiality

PolicyStatus/Initiatives

1. Express statement on governance of the investment corporation• Governance of the investment corporation
Management framework
2. Express statement on investment decision making body and the riskcorresponding to multifaceted• Investment decision making body and the risk management system for
management system for investment
social demand towards
investment
3. Establish framework for promoting implementation of the Sustainability
sustainable society• Establishment of Sustainability Promotion Council for TRM
Policy12.8

By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development andlifestyles in harmony with nature

16.7

Ensure responsive, inclusive, participatory and representative decision-making at all levels

Relevant SDG Targets

15

Sustainability Policy / Structure for Promotion
Relevance of the Materiality of CRR and TRM to that of TFHD GroupCRR・TRM

TFHD Group
Step1 Determination and organization of social issues
Generated a list of 470 items with reference to TFHD Group’s
management plans, the GRI Guidelines, ISO26000, the SDGs
Step2 Integration and consolidation of issues

Extractionof items

Step2 Integration and consolidation of issues

Selected 31 material issues with consideration of relevancy to TFHD
Group’s activities
Step3 Interview of management staff and experts

Step3 Reflection of opinions from officers and employees

Gather opinions from management staff and experts in specialized fields
Step4 Identification of Materiality
Verified the appropriateness of the importance of each issue andcategorized into seven

Materiality

Relevant SDGs

Step1 Awareness and organization of societal issues

Step4 Identification of materiality

Information
sharing
Materiality

Economic, political, and regulatory changes

Reducing environmental impact

Diversification and globalization of lifestyles

Human capital development
as a group of professionals

Safety and security in local communities andurban areas

Contribution to the region

Progression of a low birth rate and aging society

Health and well-being of tenants

IOT / Innovation
Changes in the natural environmentMore stringent social demands

Relevant SDGs

Supplier engagement
Management framework corresponding tomultifaceted social demand towards sustainable
society(Note)TFHD Group’s Materiality is those at the time of identification of Materiality for CRR and TRM

TFHD Groupʼs Code of Conduct, etc. that TRM shares as a member of TFHD GroupAs a member of TFHD Group, TRM does not only leverage TFHD Groupʼs comprehensive value-chain and expertise, but also shares the Code of Conduct and otherpolicies of TFHD Group.
16

Sustainability Policy / Structure for Promotion
TopicsPreventive measures against COVID-19(CRR)
Implemented measures of putting posters of infections disease measures toraise tenants’ attention, and setting alcohol-based hand sanitizers in common
spaces, etc.
 Infections disease measuresposters

 Alcohol-based handsanitizer

Donation to Hokkaido pref. through regional revitalization
support tax system (TRM)
Through the regional revitalization support tax system, TRM made a donation to afundraising program in order to support medical staff in Hokkaido pref. where CRR
owns a property. This donation is a part of efforts to “contribution to local
communities”, one of the Materiality that CRR shares with TRM.

Change in Asset Management Fee System(CRR)

Additional ownership acquisition by the Sponsor

Incentives have been introduced for further improvement of and growth ofunitholder value and enhanced linkage with the interests of unitholders.

In the public offering conducted in February 2021, the Sponsor acquired an
additional 2,137 units of the new investment units issued by CRR. Going forward,
we expect to receive strong Sponsor support through the further aligning of ourinterests.

Calculation method(Applicable from Aug.2020)
Management fee I

Total assets at the end of previous fiscal period × 0.2％
(annual rate)

Management feeII

Ordinary CF × 5.4％

Number of units issued
and outstanding

671,624

21,370692,994(fee linked to total assets)(fee linked to profit)

Before issuing units

Issuing units

After issuing units(acquisition anddisposition fee)

（0.5% in the case of transactions with related parties(excluding warehousing))

Property acquisition/disposition price×1.0％

Number of units held bySponsor60,1272,137

62,264

Management fee V

Ordinary CF × growth rate of ordinary CF per unit × 10％

Percentage of units heldby Sponsor

9.0%

10.0%

9.0%

Management fee III(incentive)

However, no fee will occur when the value is negative17

Sustainability Policy / Structure for Promotion
External Certifications / International Initiatives
GRESB Real Estate Assessment
CRR has participated in the GRESB Real Estate Assessment since 2018.
We will continue to promote sustainability initiatives through the participation, and aim to further improve
its rating in the assessment.

Successive Selection in MSCI Japan ESG Select Leaders Index
CRR was selected for “MSCI Japan ESG Select Leaders Index” provided by MSCI in
May 2019, and has been continuously included in the index even after therebalancing in June 2020.
The Government Pension Investment Fund (GPIF) has also selected the Index as
one of their ESG indices for their passive investment.

International initiative（UNGC）
TFHD has been a signatory to the United Nations Global Compact since December 2016 and TRM
supports the UNGCʼs 10 principles as a member of TFHD Group.（For the UNGC 10 principles, please refer to page 35.)
TRM shares the Human Rights Policy of TFHD Group announced in January 2020 (Cf. page 34) and conducts business inbelief that the respect for the human rights of all its stakeholders is essential.
We also believe that all the companies should hold such respect.

18

Environment

Our View on Environment
We are implementing sustainable property management
through various initiatives, including reducing energy
usage and acquiring environmental certifications.

Environment
7.3 By 2030, double the global rate of improvement in energy efficiency

Relevant SDG Targets

12.5

By 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse.

12.8

By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development and lifestyles in harmony with nature

Environmental Performance
Reduction targets

Actual Figures（Note1）

Among the various problems relating to the environment, CRR views climatechange as the main risk, and we have specified the reduction of ourenvironmental footprint as a target in our materiality. We are aiming to reduce ourenergy consumption and CO2 emissions by 1% per year on an intensity basis
over the medium to long term. Recognizing that reducing our environmental
footprint and contributing to the mitigation of medium-to long-term climate changerisks, such as extreme weather and sea level rise, will support the maximization of
medium-to long-term unitholder value, which is CRR’s priority issue, we are
striving for sustainable growth through initiatives targeting the environment andthe realization of a recycling-oriented society.
Item

Reduction targets（Intensity basis）

Energy consumption per year

Medium-to long-term target of 1%
average annual reduction

CO2 emissions per year

Medium-to long-term target of 1%
average annual reduction

Water consumption per year

avoid increase in intensity

Waste generation per year

avoid increase in intensity

Energy consumption（Note２）

2019（Note4）

Actual

9,024

9,693

8,420

Intensity（Mwh/m²）

0.102

0.113

0.091

Scope 1

297

304

260

Scope 2

3,505

3,720

3,121

Total
（t-CO2）

3,802

4,024

3,381

Intensity（t-CO2/m²）

0.043

0.047

0.036

Actual38,23239,08940,122

Intensity

0.413

0.426

0.406

（Mwh）

（t-CO2）CO2 emissions（Note３）

Water consumption

2020

2018

（t-CO2）（m³）（m³/m²）(Note1)As a rule, the actual figures for common areas of rental residences in the portfolio are indicated. Intensity is calculatedwith the following formula: total consumption for a given year ÷ floor area of common areas (in the case of water
usage, some private areas are included in the results).
(Note2)The actual figures for fuel (gas, kerosene) and electricity consumption in common areas are indicated, but the electricity
consumption for 2018 and 2019 includes the amounts used by some retail tenants.
(Note3)CO2 emissions were calculated using the Ministry of the Environment’s “Calculation Method and Emission Coefficient
List for the Calculation, Reporting, and Disclosure System” and “Emission Coefficient List by Electricity Provider.”(Note4)The actual figures for FY2020 were assured by a third-party organization. Since the water consumption amounts
indicated in the assurance report (Cf. page 72) include the consumption amounts for operational rental residences,the values differ from the actual results above.

20

Environment
Environmental Considerations
Switching to LED lights in common areas

Replacing air conditioners in private areas

For environmental conservation, CRR has been switching to LED lights in the common
areas of properties. This will help reduce power consumption and environmental impact.

For environmental conservation, CRR has been replacing air
conditioners that have reached a certain number of years since
installation in the private areas of properties. This will help reduce
power consumption and environmental impact.

Installation of electric power measuring system

Green-lease provisions

In order to increase the actual electric power
consumption coverage rate at owned
properties, electric power measuring systems
have been installed at 2 properties (equivalent
to 15.3% of the portfolio) as of the end of July
2021. The installation makes it possible tomeasure power consumption at exclusive
areas. Furthermore, activities to raiseawareness for energy saving among tenants
are being carried out.

From the perspective of environmental friendliness, to reduce environmentalload in collaboration with residents, we insert green-lease provisions in leaseagreements, which are related to energy use and appropriate disposal of waste.

Green Procurement Standards
CRR will promote the reduction of the environmental load in cooperation with
suppliers, etc. by establishing the Green Procurement Standards which are
related to the procurement of environment-friendly materials, etc. (Cf. page 42)

21

Environment
Considerations for recycling-oriented society
Separate management of waste
CRR reduces environmental impact at
properties through separate disposal ofwaste in cooperation with the managementcompany. It is also making effort to improveresident satisfaction by taking measures toreduce odor at garbage collection points.

Use of Renewable Energy
CRR utilizes renewable energy fromsolar power
Annual power generation of the solar power
facilities in COMFORIA NAKAOCHIAI

3,990.5kwh（Feb.2020～Jan.2021）

Providing garbage disposal guides

Increasing Greenery and Biodiversity

For environmental conservation,
Comforia Shinjuku Eastside Tower offers
guidance on separate disposal of
garbage in the user guides for residents
to raise environmental awareness.

With a site area of more than 1,000
square meters, Comforia Shinjuku
Eastside Tower has developed a greening
plan in accordance with the Ordinance for
the Conservation and Restoration of
Nature in Tokyo, based on which it offers
a lush space filled with natural features.

We comprehend owned properties’equipment using water and their function
and consider introducing water-saving
equipment at properties that have yet toemploy said equipment where possible. We
promote efficient use of water resources bychanging to products that save hot/coldwater.

At Comforia Kinshicho DEUX, we havealleviated the heat island effect andimplemented energy-saving measures byplanting vegetation on the rooftop.

Efficient use of water

22

Environment
Establishment the Environment Management System(EMS)TRM established a unique environment management system (EMS) which applies PDCA cycle to continuously approach to environmental challenges. We areworking to continuously reduce environmental impacts in the management operation for CRR, through the cycle of four steps; set targets (Plan), assess
performance (Do), analyze budget vs. actual (Check), and implement countermeasures for a better performance (Act). The Asset Management Department of
Comforia Management Division reviews actual performances in its monthly meeting and reports the results to the management at least once a year, then receives
feedbacks and instructions for further improvement for the following year, from the management.

23

Environment
Urban Site Investment Criteria
Undeveloped Sites Commitment
CRR aims to secure stable income and achieve steady growth of our assets
under management from a medium-to long-term perspective. When acquiring
assets developed on undeveloped sites, we give ample, rigorous consideration
to the impact that development activities have on the natural environment andecosystems, as well as considering compliance with environmental laws, theacquisition of environmental certifications, etc. before investing in them.

Investments in Flexible / Mixed Use Properties
CRR owns a number of mixed-use properties. By investing in mixed-use
properties that house facilities such as convenience stories and clinics, we
contribute to improving the convenience of daily living for tenants and nearby
residents, reducing the environmental footprint by reducing the travel distance
between various facilities, and the revitalization of communities.

Investments Towards Urban Revitalization
and Redevelopment Properties
As a rule, CRR does not invest in unoccupied properties that have not been
completed yet, such as new development projects, but we actively invest inproperties developed based on redevelopment projects. Through theacquisition of such properties, we contribute to the revitalization ofcommunities by improving convenience for local residents.

COMFORIA SHINJUKU EASTSIDE TOWERCOMFORIA SHIBUYA WEST

COMFORIA SETAGAYAKAMIUMACOMFORIA HIGASHISHINJUKUSTATION FRONTInvestments Towards
Existing Urban Brownfield Redevelopment
Through investing in existing development areas, especially in Tokyo’s 23 wards,
CRR invests in properties that utilize existing infrastructure, such as roads, waterand sewer lines, schools, and hospitals.
By making use of existing infrastructure, we are engaged in investment thatprevents urban sprawl and leads to a decrease in energy consumption
associated with shipping/traffic and the loss of green areas, which causes theheat island effect.
24

Environment
Green Building Certification

Believing that establishing a portfolio with a small environmental footprint will result in improved unitholder value in the medium-to long-term , CRR has targeted theacquisition of environmental certificates for 1 or 2 properties per year (approx. 3 to 6 properties in 3 years).
Aim to obtain environmental certification

Performance（as of the end of Jul. 2021）

1 or 2 properties per year

5 properties・19.2％(approx. 3 to 6 properties in 3 years)（based on gross floor area)）

DBJ Green Building Certification
DBJ Green Building Certification Program was launched by Development Bank of Japan Inc. (DBJ) for the purpose of supporting the properties which give propercare to environment and society (Green Building).The program evaluates, certifies and supports properties which are required by society and economy. It makes
comprehensive assessment of properties, while evaluating various factors which range from properties' environmental features to their communication withstakeholders, such as disaster prevention and proper care for surrounding communities.
Furthermore there are 5 levels, "five stars", "four stars", "three stars", "two stars", "one star" as the certification ranks.
CRR has acquired the DBJ Green Building Certification for the following property.

Five Stars

COMFORIA SHINJUKU EASTSIDE TOWER

Four Stars

COMFORIA TOYOCHOCOMFORIA SHIBUYA WEST

COMFORIA KAMATACOMFORIA HIGASHISHINJUKUSTATION FRONT

25

Environment
Green Bonds
As part of its efforts to contribute to the development of sustainable society, CRR has issued the Green Bonds. CRR aims to further promote its sustainability initiatives through issuance of the green
bonds, and invite new investors to its investment corporation bonds by stimulating their demand who have interest in ESG investment.

Green bond Framework
1．Use of Proceeds
The proceeds of the green bond will be allocated to acquire the existing or new buildings that meetthe following Eligibility Criteria A (‘Eligible Green Projects’), or refurbishments that meet the following
Eligibility Criteria B or to refinance the existing loan/investment corporation bonds which have been
allocated to Eligible Green Projects or refurbishments.

2．Eligibility Criteria

3．Management of Proceeds
CRR extracts the Eligible Green Projects out of CRR’s portfolio and uses the calculable total bookvalue of the Eligible Green Projects as of the end of the latest fiscal period prior to the date of eachbond issuance (note 1) as the Debts of Eligible Green Projects. As long as the Green Bond isoutstanding, we will monitor once a year, to ensure that the total amount of outstanding green bonds
does not exceed the sum of Debts of Eligible Green Projects and green bond proceeds allocated torefurbishments.

CRR shall apply one or more of the following criteria to allocate the proceeds into Eligible Projects:

As of January 31, 2021

A. Eligible Green Projects
Buildings that have achieved the following top three levels of third-party green building
certification/recertification within 36 months prior to the payment date of green bonds or willachieve:① B+, A or S Rank under CASBEE② 3, 4 or 5 Stars under DBJ Green Building Certification Program③ 3, 4 or 5 Stars under BELS

B. Refurbishments
Refurbishments with a primary purpose of achieving one of the following criteria and arecompleted within 36 months prior to the payment date of green bond or will be completed:① Refurbishments with more than 20% reduction in energy consumption and water consumption② Newly achieve the top three levels of green building certifications listed above Eligibility
Criteria A or more than one level of star/rank improvement in the green building certification(Note1) “Eligible Green Projects as of the end of the latest fiscal period to the date of each bond issuance” refers to the buildings that haveachieved the top three levels of one or more of the third-party green building certifications/recertifications within 36 months prior to the endof the financial period immediately preceding each date of bond issuance.
(Note2)The amount of Eligible Green Projects is calculated based on the book value at the end of January 2021.
(Note3)Outstanding amount of the green bonds is calculated as of July 8, 2021.

26

Environment
4．Reporting
CRR will disclose on its website the amount of Eligible Green Projects and/or refurbishments financed/refinanced, allocation status, including the amount of unallocated proceeds, schedule of allocation andmanaging method, of the net proceeds of green bonds as of end of every January until the proceeds are fully allocated. In the event of major change in situation, such as the accrual of unallocated funds as aresult of the sale of relevant assets, such facts will be disclosed in a timely manner. CRR will also disclose that the total amount of outstanding green bonds does not exceed the sum of Debts of Eligible Green
Projects and green bond proceeds allocated to refurbishments. Furthermore, after issuance, for as long as the green bonds are outstanding, it will annually report on the book value of all the Eligible Green
Projects and the total amount of outstanding amount of the green bonds as of the last day of January in each year.

5．Impact Reporting
As long as there is an unredeemed balance of the relevant green bonds, CRR will annually disclose on its website summary and the progress and levels of certifications of Eligible Green Projects. Additionally,
CRR will annually disclose the following indicators of Eligible Green Projects where CRR has energy control authority:① Energy consumption② Water consumption
As for the refurbishments that have been funded by the green bonds, the environmental benefits brought by each project will be disclosed. CRR will indicate an estimated rate of reduction (%) of energy
consumption and water usage before and after the refurbishment.

Impact Reporting

Green Bond Summary
Total issue
amount Interest rate(￥million)

Offering date

Redemption date

Description

July 30, 2020

July 30, 2030

Unsecurednonguaranteed

The 8th unsecured investment
corporation bonds(green bonds)

1,500

The 10th unsecured investment
corporation bonds(green bonds)

3,000

0.460%

July 8, 2021

July 8, 2031

Unsecurednonguaranteed

Total

4,500

－

－

－

－

0.550%

Energy consumption per year
（kWh/㎡）

Water consumption per year
（㎥/㎡）

2019

41.68

0.2503

2020

38.48

0.2083(Note) Results in the above table are actual figures for the common areas in the Eligible Green Projects of CRR.

List of CRR's Green Eligible Projects
Received ranks
Property no.

Property name

DBJ Green
Building
Certification

Certification for
CASBEE for Real
Estate

BELS
Certification

Book value atthe end of
the period(¥ million)

98

COMFORIA SHINJUKU EASTSIDE TOWER

★★★★★

－

－

12,721

107

COMFORIA KAMATA

★★★★

－

－

5,742

125

COMFORIA SHIBUYA WEST

★★★★

－

－

5,469

135

COMFORIA HIGASHISHINJUKU STATION FRONT

★★★★

－

－

5,681

145

COMFORIA TOYOCHO

★★★★

－

－

3,796

Total Eligible Green Projects（Note1）Listed are the buildings that have achieved the top three levels of one or more of the third-party green building certifications/recertifications within 36 months prior to January 31, 2021.
（Note2）“Book value at the end of the period” is calculated based on the book value at the end of January 2021.

33,41127

Society

Our View on Society
We are continuously maximizing unitholder value andfulfilling our social responsibilities through efforts tobuild favorable relationships between CRR and its
stakeholders.

Society

Relevant SDG Targets

11.3 By 2030, enhance inclusive and sustainable urbanization and capacity for participatory, integrated and sustainable human settlement planningand management in all countries
12.8 By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development and lifestyles inharmony with nature

Stakeholder Engagement

In the pursuit of CRR’s and TRM’s business, our relationships with investors and various other stakeholders, including employees, local communities, tenants, andsuppliers, are absolutely vital. We also recognize that building favorable relations with these stakeholders in the medium-to long-term is an essential factor in our aim
of maximizing unitholder value, which is CRR’s priority. We will continue to pursue our business as a member of society and work to further strengthen our
relationships of trust with all stakeholders involved with CRR’s and TRM’s activities.

Investors◆Financial result briefing・Unitholders’ meeting◆Meetings with domestic andforeign institutional investors◆Seminar for Individual Investors◆Presentation Video

Suppliers◆Joint seminars◆Local staff awards◆各種研修制度◆人事制度
Employees◆働き方改革◆福利厚生◆ダイバーシティ◆Various
Training programs◆Work-Life Balance◆Diversity

CRR
TRM

Local Communities◆Disaster prevention
measures◆Participation incommunity activities◆Security maintenance

Tenants◆Tenant satisfaction survey◆Cooperation with tenants◆テナント満足度調査◆Effort to advance health/wellness◆テナントとの協同促進◆Disaster prevention measures◆健康・快適性向上への取組み
◆防災対策

29

Society
Employee Engagement
As a group of experts in real estate management, TRM provides high-quality asset management services with objective to maximize the value of its shareholders, andto that ends, we promote our own human-capital strategy in view of the importance of human capital development. TRM is making continuous effort to have various
systems to form a working environment and organization enabling to realize and promote the health and comfort of employees.

Strategy of Human capital development & retention
 Employee skill development（Utilization of external training institutions）
As a professional group involved in real estate management, TRM aims to maintain the quality of its services and further develop its operations. We promote and support theacquisition of specialized qualifications by our employees, and throughout the year, on a voluntary and planned basis, We hold training and seminars to share practical knowledge andindustry trends or adapt to laws and regulations and implements a range of position-based training programs and personal development activities.
≫ Training program examples（Representative efforts）

Position-based
trainings

Examples include orientation training for mid-career hires on wide
range of knowledge on asset management business andunderstanding of regulatory compliance; management training forsenior management and medium level employees; business skills
training and anti-harassment seminar for all employees withutilizing of external training institutions.
As part of awareness program on ESG investment, we invite
external experts to provide employees with periodic training fortheir deeper understanding of ESG and introduction to new
trends.

ESG training

Courses to improve computer skill, English conversation and other lessons are also provided.
≫ Training attendance record

Item

FY2020≫ Support for acquiring business related qualifications

We support acquisition of necessary qualifications by employees in various measures
including financial aid for examination fees and class fees. We also hand in monetary
reward once employees pass specified examinations.
Status of employee qualification（As of June 30, 2021）
Number of
employees

Use of Qualification
Support System

Real Estate Broker

93

14

ARES Certified Master66

24

Certified Building Administrator

24

4

Certified Property Manager

123Chartered Member of the Securities
Analysts Association of Japan

2－

Real Estate Consulting Master5－

Qualification(FY2020）

Training hours per employee

27.3hours

Real Estate Appraiser

7－

Training expenses per employee¥44,906

First-Class Architect

8

－
30

Society
 Training programs of Sponsor
The Sponsor offers HR training programs that enable each employee to exercise and develop their skills.

Desired human resources image

Position-based trainings
・Training of New employee introduction

New employee

・Joint training of TFHD Group New employees
・Training of Accounting
・Training of Critical Thinking

Employee class（New employee 〜
Ninth year employee）

・Self-management
・Enhancement of organizational strength・Expansion of self-capacity

Second year
employee

Third year
employee
Fourth year
employee
Ninth year
employee

・Training of Communication
・Training of Finance・Training of Negotiation
・Training of Facilitation
・Training of Strategy/Marketing
・Training of Legal/Compliance・Training of Career Design

・Strategy・Marketing（Advanced）

Chief classManagement class・Training of Hypothesis Thinking

・Leader-ship skill
・Management skill
・Expansion of self-capacity

・Training of New Group-leader
・Training of New Group-leader Coaching・Training of Executive Manager（Note）Employees temporarily assigned to TRM from the Sponsor are included in the above training.

 Personnel system
TRM has regular communication opportunities with employees including one-on-one session with the direct supervisor and review staffʼs performance based on the objective ofcareer development set by each. We encourage each staff to have their own career plan and to acquire skills that are competent inside and outside of the company. ESG-related
efforts and relevant items are included in the annual target to set. Based upon the fact that the number of employees of TRM had increased to a certain size, partly because of themerger happened in 2017, we decided to conduct shuffling of employees among different divisions in order to raise career development of our employees. Meanwhile when
conducting such occupational relocation, we pay close attention to the information firewall between the different business divisions.
31Society
For work-life balance & health of employees Working-style reform

Recently, under the working-style reform trend including rectifying the practice of working long hours, TRM actively takes approaches to introduce more flexible working style ofemployees with objective to improve their work-life balance.
Paid-leave usage encouragement

Every year, employees are required to set up so-called “commitment holidays”, a seven-day paid leave (five days in a row + two days
immediately before or after that week) and to share such committed calendar within the teams they belong to. TRM is also creating
business environment for the employees to digest their allocated paid leaves, by proactively setting up recommended days to use paid
leaves.

Flex-time work system

We have introduced a flex time working system for all employees. Core time is set between 11:00 and 15:00, and employees are free toset start and finish of their work hours around the core time to support more flexible working style considering the wide variety of living
environment of each individual.

Work-from-home system

The Covid-19 outbreak pulled the need for introduction of work-from-home, and we are working to improve productivity with reducing
commuting time to workplace. Use of serviced office space is also allowed under preset rules.

Effort to reduce overtime

In order to prevent excessive long working hours, TRM is taking necessary measures. The employees are required to set an upper limitof overtime working hours at the beginning of the fiscal year, and such objectives are regularly monitored and reminded. In certain
cases, we intentionally raise them as a meeting agenda if the working hours are excessively long.

 Welfare programs

TRM values its employees, their well-beings, and healthy performance in work, and provides all staff with various welfare programs to improve their satisfaction as below.
（Excludes contract/dispatched employees for some Welfare programs）
Cafeteria plan

To support self-support and independence of permanent employees, we provide them with financial aid for medical fees, subsidies for use of
sports facilities, studying, volunteer activities, employee shareholding program, and use of the facilities Tokyu group companies operate.
Various systems are in place to provide support for employees at each stage of life, such as maternity leaves, childcare leaves, child medical
leave, nursing-care leave.
We support asset formation by permanent employees, by inviting external financial planners to offer introductory sessions on topics including
defined contribution pension matching program which TRM offers and the insurance system by the Tokyu group.
Through our employee stock ownership plan and cumulative REIT investment program, we provide financial incentives for purchasing fixedamounts of TFHDs stock, Comforia Residential REIT investment units, and Activia Properties investment units.

Welfare programs

We increased the number of available facilities to enable more employees to use the popular exclusive resort membership “Tokyu Harvest Club.”32

Society
 Internal communication
TRM periodically organizes employee satisfaction surveys and explanatory sessions on the corporate annual objective and medium- to long-term vision, for a more profoundunderstanding between the company and employees, expecting to develop the productivity of our organization where employees can deliver their best performance.
Employee study groups

Younger employees have led voluntary organization of cross-divisional study groups to share information on businesses unique to each division,and on necessary knowledge/skills.

Support for company circle
activities

Financial support is provided to employees for company club activities.

Luncheon

To enhance communication among employees, regular luncheons by groups of a small number of staff have been organized.

 Employee health & comfort

TRM is making effort to maintain the workplace healthy and comfortable, encouraging employees to show the best performance.
Workplace of TRM is in Shibuya, an exciting and innovative city where the areas people live and play are closely connected. Employees can takebeverages for free and use individual spaces, and a space for refreshment is created with green on the terrace of the building where TRM is
located, Shibuya SOLASTA. The building earned the CASBEE Wellness Office, a recognition of the buildingʼs ability to promote health and comfortof people work in the building.

Working environment
Also, as a preventive measure against COVID-19, the workspace of TRM is equipped with protective panels on the desks in office space andmeeting rooms, as well as air purifiers at the elevators.

Healthcare

Employees are obliged to take annual medical checkups. There is also a mental health consultation desk.

Health Committee

Health Committee is established to improve employeesʼ occupational health. The Committee examines labor-related problems occurred in thecompany, reports the results of investigation on comfort and safety in the workspace, and takes measures to increase awareness for mental andphysical health by poster, etc. Lectures by industrial physicians on related themes are held.

Once a year, employees have one-on-one session with HR department, where they can discuss and share their career development plan and
One-on-one session with HR explain their troubles and expectations related to the relationship with supervisors and colleagues. The confidentiality of employee information is
guaranteed.

Whistleblower system

TRM established the Compliance Helpline Counter as a contact point to report and consult on compliance matters including when harassment andbullying is experienced or observed, enabling all officers and employees to directly report to the Compliance Officer of TRM, General Manager ofLegal Affairs Department of TLC, General Manager of Group Legal Affairs Department of TFHD, or external attorneys. Moreover, we pledge tomaintain the confidentiality of personal information or investigation-related information about the individual who reported or consulted on the matterand the subject of the report or consultation, which shall not be disclosed internally or externally without good reason.
33

Society
 Employee satisfaction survey（Survey with a third-party）
Every year, TRM conducts an employee satisfaction survey with a third-party partner. Based upon the results of the survey, we are taking variety of means to improve employee
satisfaction level.
Item

FY2019FY2020

Employee engagement level

62.6

60.8(Note)

Nb. of responses / Nb. of eligible employees

95 / 95

96 / 98

Participation rate

100%

98%

(Note) The figures are in high level among Japanese companies, and the engagement status is overall good.

Diversity
TFHD Group accepts the difference in a variety of attributes such as gender, age, nationality and handicap and brings about innovation by showing individual ability to the maximum
and continues to create value through its business activities. TRM is working to make a workplace without any discriminatory treatment and compensation due to different attributes,
where all employees can rely on.

 Human Right Policy

TFHD Group Human Rights Policy

TRM shares the Human Right Policy published in January 2020 by TFHD Group and carries out
its business in belief that respect the human rights of stakeholders of the group including
employees is essential and it is what all companies are expected to do.

34Society
Respecting basic labor rights and aiming at coexistence and co-prosperity with employees, TFHD Group supports and respects the OECD Guidelines for Multinational Enterprises,
international labor standards and Guiding Principles on Business and Human Rights. In December 2016, the Group stated its support for the UN Global Compact. In accordance withthe ten principles of the UN Global Compact in the areas of human rights, labor, environment and anti-corruption, we promote responsible management and contribute to a sustainable
society. TFHD Groupʼs support for UN Global Compact shall apply to all group companies including TRM

The 10 Principles of the UN Global Compact

Fundamental rights in hiring and employment of TFHD GroupTFHD Group will respect the following matters as a set of fundamental rights in hiring andemployment in order to achieve co-existence and co-prosperity with employees
1.Prohibition of discrimination: We will eliminate all discriminatory actions based on nationality,
race, religion, beliefs, gender, age, sexual orientation and/or disability and will strive to maintainequal opportunity and treatment in hiring and employment.
2.Prohibition of harassment: We will never engage in sexual harassment, power harassment, or
any other form of harassment toward people in the workplace. We will also never tolerate
language or actions related to harassment.
3.Prevention of forced labor: We will strive to eliminate and prevent all forms of forced labor.
4.Curtailment of overwork and reduction of overtime: We will establish a fundamental policy on
work management to curtail overwork and reduce overtime work giving consideration toemployees’ work-life balance and their health maintenance/improvement. In Japan, we willcomply with the “Article 36 Agreement.”
5.Prevention of child labor: We will support and practice the effective abolishment of child labor.
6.Respect for freedom of association and the right to collective bargaining: In recognizing thatthe freedom of association and the right to collective bargaining are fundamental human rightsthat must be respected by a company, in countries and regions where the formation of labor
unions is allowed we fully recognize employees’ right to organize, right to collective bargaining
and right to strike in labor agreements. In addition, even in countries and regions that do notallow the formation of labor unions due to laws or practice, we will effectively promote conflict
resolution through dialogue involving management and labor with the purpose of securing thefreedom of association and the right to collective bargaining.
7.Payment of wages above and beyond the minimum wage: We will comply with labor laws andregulations and adopt a fundamental policy on labor management in which we will pay wages to
employees above and beyond the minimum wage for acceptable living conditions.

Human rights

Principle 1: Businesses should support and respect the protection ofinternationally proclaimed human rights; andPrinciple 2: make sure that they are not complicit in human rights abusesLabourPrinciple 3: Businesses should uphold the freedom of association andthe effective recognition of the right to collective bargaining
Principle 4: the elimination of all forms of forced and compulsory labour:
Principle 5: the effective abolition of child labour; andPrinciple 6: the elimination of discrimination in respect of employment andoccupation

Environment

Principle 7: Businesses should support a precautionary approach toenvironmental challenges;
Principle 8: undertake initiatives to promote greater environmental
responsibility; andPrinciple 9: encourage the development and diffusion of environmentallyfriendly technologies

Anticorruption

Principle 10: Businesses should work against all forms of corruption,
including extortion and bribery

35

Society
Key Employee Data
Item
Number of Employees（Note1）
Male
FemaleOf which full-time
MaleFemaleOf which contract employees
MaleFemaleOf which contract employees from convert
temporary employees
Of which seconded（Note3）
Male
FemaleRatio of female employees(Reference)Temporary employees
MaleFemaleNew Hire（Note4）
Male
FemaleOf which full-time employees from contract
employees（Note5）
Number of Directors（Note6）
Of which female directors
Ratio of female directors
Number of senior management（Senior Manager or above）
Of which female senior management
Ratio of female senior management
Turnover ratio（Note7）

The end of April
2019

The end of April
2020

The end of April
2021

KPI target for
FY2030

TFHD GroupFY2030 KPI

93
55
38
41
21
20
12
2
10
6

97
55
42
47
25
22
12
1
11

106
59
47
53
30
23
14
1
13

－
－
－
－
－
－
－
－
－

－
－
－
－
－
－
－
－
－

2

1

－

－

40
32
8
40.9%
3
0
3
10
3
7

38
29
9
43.3%
7
1
6
6
4
2

39
28
11
44.3%
8
2
6
6
5
1

－
－
－
50.0%
－
－
－
－
－
－

－
－
－
over50%
－
－
－
－
－
－

2

1

0

－

－

4
1
25.0%

4
1
25.0%

4
0
16.6%（Note9）

－
－
50.0%

－
－
－

27

29

31

－

－

4
14.8%
0.0%

3
10.3%
1.0%

5
16.1%
0.0%

－
40.0%
1.0%

－
over20％－(Note2)（Note8）（Note1）Full-time, contract and seconded employees（Note2） Number of Persons as of end of April 2019 is the total number from FY2017（Note3） Tokyu Land Corp. and Tokyu Community Corp.
（Note4）Full-time employee（Note5） Implemented from FY2018（Note6）Including part-time staff（Note7）Full-time（Note8） Shared Group-wide criteria for TFHD Group FY2030 KPI （Note9） Only this item shows the figures as of June 2021

36Society
Status of Work-Style Reform and Diversity Promotion
FY2017FY2018FY2019FY2020KPI target for 2030

TFHD GroupFY2030 KPIHealth check participation

97.7%

100%

96%

94.7%

100.0%

100%

Stress check participation

94.3%

97.8%

100.0%

98.9%

100.0%－

Annual paid leave per person

11.5days

10.8days

11.5days9.9days－－

Ratio of disabled employees

0.0%

0.0%

1.2%

1.0%

2.3%

－

Number of employees aged 60 or above

1

1

1

3

－

－

Foreign employees

0

0

0

1

－

－

22.5hours

29.4hours

21.2hours

19.4hours

－

－

0

0

0

0

－

－

Absentee rate

0.5%

0.3%

0.5%

0.4%

－

－

Ratio of employees on leave

0.0%

0.0%

0.0%

0.0%

－

－

Childcare leave users

0

0

0

3

－

Childcare short working hour/childcare
off-peak commuting users（Note1）

Ratio of malechildcare leave
100％

1

2

1

0

－

－

Nursing-care leave users

0

0

0

0

－

－

Home Office utilization rate

―

―

100%

100%

－

－

Item

Monthly average overtime
Number of workers’ injuries/death incident（Note2）（Note4）（Note3）（Note1） A system that allows flexible work hours corresponding to lifestyle (example: 8:00-16:30 work) （Note2）Utilization rate of work-from-home between March and April 2020
（Note3） Shared Group-wide criteria for TFHD Group FY2030 KPI （Note4） Only this item shows the figures as of June 2021

37

Society
Initiatives to Local Communities
CRR and TRM believe that contribution to local communities lead to the improvement in value of the CRRʼs owned properties and ultimately by the unitholder value.
We make a variety of efforts in the owned properties to enhance communication with the local communities with an expectation that our business operation is to serve
an important role for the society.

Security of the local community
There is a police box on thepremises of Comforia Shinjuku
Eastside Tower, contributing to thesecurity of the local community.

Contribution to the region
TRM periodically participate in“town cleaning” sponsored bygreen bird (specified non-profit
corporation).

Disaster provision warehouse andmanhole toilets

Installation of donation-type vending machines
To improve the safety and sense of security of residents
and the local community, we have installed disaster
response vending machines at some of the properties
owned by CRR. These machines can provide drinks asrelief supplies to victims of strong earthquakes,
typhoons, and other natural disasters.

Corporate version Hometown Tax Payment
Through the regional revitalization support tax system,
TRM made a donation to a fundraising program in orderto support medical staff in Hokkaido pref. where CRR
owns a property. This donation is a part of efforts to“contribution to local communities”, one of the Materialitythat CRR shares with TRM.

At Comforia Shinjuku Eastside Tower, wehave established a disaster provision
warehouse designated by the Shinjuku ward
and manhole toilets for neighboring residents
and workers in preparation for a disaster. We
have also entered into an emergency mutual
assistance agreement with three neighboring
town councils to strengthen partnerships.
38

Society
Initiatives to Tenants
CRR believes that its owned properties should always meet tenant preferences to enhance the medium- to long-term value of our unitholders, and therefore tenantsatisfaction serves an essential role for that. To that end, we consistently communicate with them to understand their needs and reflect them for our asset management
operation.

Conduct Tenant satisfaction survey
Every year we carry out a questionnaire survey of the residents of the Comforia series, which are operated by CRR, on the Comforia brand as well as residents’ satisfaction
and requests regarding management and operation. Based on the opinions and requests of residents, we take actions with the aim of providing better services. An exampleof how we have improved tenant satisfaction is the increase in the number of delivery lockers in response to the opinion that there were not enough lockers due to therecent rise of e-commerce.
SurveyBuilding Cleaning(Common Areas)

Building
Management &Service

2017

2018

2019

2020

Satisfied

73％

68％

72%

73%

Neutral

14％

18％

15%

13%

Unsatisfied

13％

14％

13%

14%

Satisfied

68％

67％

69%

68%

Neutral

26％

22％

24%

24%

Unsatisfied

6％

11％

7%

8％

COMFORIA WELBOX

Value Enhancement Work(COMFORIA MINAMIAOYAMA)COMFORIA WELBOX provides a wide range ofservices to the residents of the Comforia series,
which are operated by CRR. In addition tovarious discounts using the Group’s resources,
we offer preferential rates for moving to anotherproperty in the Comforia series and we carry out
resident satisfaction surveys using the
COMFORIA WELBOX platform in an effort toimprove resident satisfaction with the aim ofencouraging longer periods of residence.

Implemented value enhancement work to divide one room into twobased on workplace needs amidst the COVID-19 pandemic.
After

Work
Space

Newly installed
partition

Newly installed
air conditioner

39

Society
Supply of emergency kits and evacuation map
After the Great East Japan Earthquake, to enhance the safety
and the sense of security of our residents, we provide
emergency kits (emergency food and goods) in the elevators of
every property, we also post evacuation maps in common spaceof all properties to inform residents of area for evacuation in
preparation for an earthquake or other disaster.

Effort to advance health / wellness

Cooperation with tenants
As part of our initiatives in collaboration
with tenants, we created and distributed a
Sustainability Guide. This guide promotes
reduction of households’ environmental
footprint, primarily through energy saving
and the 3 Rs, and tenants are pursuing
various efforts aimed at the realization of asustainable society.

Comforia Itabashi Nakajuku provided
running lessons for tenants which wereorganized by Tokyu Sports Oasis, Inc.

40

Society
Initiatives to Suppliers

TRM recognizes the importance of cooperation with its suppliers, as stated in the Sustainability Policy, that it provides initiatives and procurement with consideration
to the environment and society, through engagement to suppliers such as PM , BM , Appraisal companies and Engineering Report companies etc. As part of theinitiatives, TRM established the Green Procurement Standard and monitors ESG consideration in the operation of its important suppliers including PM and othercompanies.

Joint seminars
We work to foster a culture that ESG initiatives are to
be taken by our entire supply chain, not limited to theofficer and employees of TRM. To that end, ESG
training sessions are co-organized by TRM and PMs.
In FY2020, TRM organized also virtual seminars
themed ESG trend, Materiality and application of theGreen Procurement Standard.

Local staff awards
At Comforia Shinjuku East Side Tower, we
provide awards for concierge staff.
In addition to increasing the motivation ofthese staff members, we believe this helps toestablish an operating structure with a feelingof togetherness between asset management
and building management personnel.

41

Society
Green Procurement Standard
As a member of TFHD Group, TRM shares the Groupʼs “Sustainable Procurement Policy” published on January 31, 2020 and works on challenges to environmental
crisis such as climate change. Our objective is to work on this goal, together with all the stakeholders including our suppliers. In line with the Groupʼs procurement
policy, TRM established the “Green Procurement Standard” to translate the policy into practical measures. This standard broadly states to suppliers that environmentfriendly procurement is to be carried out, and together with them, TRM works to promote more sophisticated efforts based on the Policy. The scope of application ofthis standard includes direct or indirect transactions related to products, services, raw materials, and design/construction procured by TRM and CRR.
TFHD Group Sustainable Procurement Policy Articles
1)Legal compliance1)-1 Total compliance with relevant laws and regulations2)Respect for human rights2)-1 Compliance with and respect for international humanrights and labor standards2)-2 No tolerance of discrimination2)-3 No tolerance of harassment2)-4 Respect for local residents2)-5 Respect for minority rights

3)Ensuring a work
environment based onsafety,health and well-being3)-1 Freedom of association, collective bargaining rights3)-2 No tolerance of forced labor3)-3 No tolerance of child labor3)-4 Fair wages3)-5 Elimination of excessive working hours3)-6 Workplace health and safety measures3)-7 Emergency preparedness3)-8 Prevention of occupational accidents and illness3)-9 Industrial Hygiene measures3)-10 Measures for physically demanding work3)-11 Proper sanitary facilities, meals and housing3)-12 Protection of foreign and migrant worker rights

4)Ensuring proper businessethics4)-1 Preventing corruption4)-2 Preventing contact with organized crime4)-3 Ensuring fair trade practices4)-4 Appropriate response to conflicts of interest4)-5 Responsible political involvement4)-6 Protection of intellectual property rights4)-7 Maintaining confidential information anddisclousure4)-8 Compliance hotline and whistleblower protection5)Environmental measures5)-1 Combatting climate change5)-2 Biodiversity protection5)-3 Protection of pollution5)-4 Effective use of resources5)-5 Proper water use
5)-6 Ensure appropriate use of forest resources6)Improving service and quality6)-1 Ensuring safety6)-2 Quality control and quality assurance systems6)-3 Proper information disclosure for products andservices

7)Proper information
management7)-1 Proper information management8)Business Continuity Planning8)-1 Business Continuity Planning9)Contributing to local
communities9)-1 Contributing to local communities

10)Extension of the Sustainable
Procurement Policy10)-1 Extension to business partners
10)-2 Cooperation for monitoring
42

Society
Initiatives to Investors
CRR and TRM view appropriate information disclosure to and proactive dialogue with investors as essential tasks.
Based on the policy described above, TRM holds regular meetings with institutional investors in Japan and from abroad (Europe, North America, Asia, etc.).
In addition, it is engaged in proactive information disclosure by holding briefings for individual investors, participating in events and online seminars aimed at individual
investors, publishing presentation videos of financial result briefings, and more.
IR activities for domestic and foreign institutional investors◆

Sep.2020～Dec.2020

Sep.18Presentation Video

21st

◆

Presentation Video◆

One-on-one Meetings◆

Online conference

103 companies◆

One-on-one Meetings

once

◆

Online conferenceFP

Aug.2020

Mar.2021～Jul.2021

Mar.1622nd

109 companies

2 times

FP

Sep.

Oct.

Nov.

Dec.

Jan.2021

Feb.

Mar.

Apr.

May.

Jun.

Jul.

IR activities for individuals investors
◆

Oct.3

SMBC Nikko Securities
WEB J-REIT Fair 2020◆

Oct.28

NIKKEI J-REIT
Infrastructure Fund Forum◆

Mar.24

NIKKEI J-REIT
Infrastructure Fund Forum◆
Apr.23
Japan Investor Relations
and Investor Support ,Inc.
IR for individual investors◆

Jun.18ARES
J-REIT online IR seminar

43

Initiatives at COMFORIA SHINJUKU EASTSIDE TOWER

With a site area of more than 1,000 square
meters, Comforia Shinjuku Eastside Towerhas developed a greening plan inaccordance with the Ordinance for theConservation and Restoration of Nature inTokyo, based on which it offers a lush
space filled with natural features.

Energy-efficient glass is used in thewindows to reduce the amount of sunlightand heat that enters, in this way
alleviating the burden on the airconditioning systems.

A large windowed entrance allows the useof natural daylight.

An open space is used as a walkway forneighboring residents and commuters.

Artworks of our Shinjuku 6-chome Plan Art
Project are exhibited on the premises andinside the building.

AEDs (automated external defibrillators) areinstalled in the disaster control center and at
the pool on the 32nd floor.

Monthly pool events (SUP YOGA,
swimming clinic, water aerobics, etc.) are
held exclusively for residents.

Pamphlets in Foreign Languages

Resident Satisfaction Surveys

To further improve user satisfaction, user guides forresidents from overseas are provided at Comforia
Shinjuku Eastside Tower. The guides are prepared in
English, Chinese, and Korean.

A questionnaire survey of residents is carried out oncea year and the issues identified are then improved.
Improvements：
Room temperature adjustments in each facility
Cleaning of gym equipment
Enhancement of lounge menus, etc.

44Governance

Our View on Governance
We have established a comprehensive corporate
governance and compliance management structure andconduct ourselves in a highly ethical manner in order tomeet the expectations and earn the trust of society.

GovernanceRelevant SDG targets

12.8 By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development and lifestyles inharmony with nature
16.7

Ensure responsive, inclusive, participatory and representative decision-making at all levels

CRR’s Corporate GovernancePursuant to the Act on Investment Trusts and Investment Corporations (“ITA”), CRR entrusts its asset management operations to TRM.
 CRR’s governance structure
CRRʼs organization comprises a unitholdersʼ meeting, a board of directors currently comprised of executive director and supervisory director, and an independent auditor.
It is stipulated that CRR shall have at least one executive director and at least two supervisory directors (however, the number of supervisory directors must be at least one
more than the number of executive directors). As of the end of July 2021, there were one executive director and two supervisory directors.

Unitholders’ Meeting

Board of Directors

Executive Director: Takehiro Izawa
Supervisory Director: Koji Yamamoto
Supervisory Director: Masamichi Ohshima

Independent Auditor
Ernst & Young ShinNihon LLC

 Unitholdrs’ meeting
Matters and issues on CRR, that are originally stipulated at ITA and other relevant laws & regulations, are to be resolved at a unitholdersʼ meeting.

46

Governance Executive Director and Supervisory Directors
The term of office for directors and supervisory directors based on regulations are two years.
Position

Name

Number of Units Held

Executive Director

Takehiro Izawa－

Koji Yamamoto－

Masamichi Ohshima－

Supervisory Directors

 Eligibility requirements
Candidate for directors must not fall under any disqualification clause as defined in the ITA. Such candidates shall be examined and appointed at a unitholdersʼ meeting.

 Compensation
The maximum compensation amounts for the executive director and supervisory directors are stipulated in the articles of incorporation, and compensation is determinedby the board of directors.
Compensation received（¥ thousand / fiscal period）

Position

Name

Concurrent positions

Executive Director

Takehiro Izawa

Executive Director, Chief Division Officer of Comforia Management
Division, TLC REIT Management Inc.

Koji Yamamoto

Partner, WAKABA PARTNERS Law And Accounting Office

1,800

Kataoka & Kobayashi

1,800

－

Supervisory Directors
Masamichi Ohshima Board of Directors
At the meeting of the board of directors, the executive director reports on the performance of its duties and the supervisory directors supervise to ensure that CRR operates
the asset management in compliance with legal and regulatory requirements. The meeting frequency of the board should be at least once in three months as stipulated underinternal regulations of CRR. However, it is held every month with a 100% attendance of directors in FY2020.

47

Governance Independent auditors
The independent auditor shall audit the financial statements of CRR and report to the supervisory directors any improper activity of the executive director. The term of office of the
independent auditor comes to an end at the first unitholdersʼ meeting held after the first financial period closed after one year or more from the appointment date. The auditor shallbe reappointed except as otherwise resolved in a unitholdersʼ meeting.
Excerpt from the semi-annual report for the fiscal period ended July 2021
Position

Name

Independent auditor

Ernst & Young ShinNihon LLC

Compensation（¥ thousand / period）
17,138(Note)（Note）The amount includes the fees pertaining to the production of an “Auditor’s Comfort Letter to Lead Underwriting Firm” related to the issuance of CRR bonds conducted in July 2021.

48

Governance
TRM’s Corporate Governance
TRM works to enhance corporate governance to exercise a fiduciary duty and a duty of loyalty to CRR as stipulated in the asset management agreement.
 TRM management organization
Under the management organization shown below, TRM exercises its asset management operation, and the Comforia Management Division undertakes the management ofassets of CRR. TRM has established the Investment Committee and the Compliance Committee to deliberate matters related to asset management and compliance, and theAcquisition Priority Review Meeting to determine the order of priority for consideration. In April 2021, TRM established the rules on the Sustainability Promotion System tostrengthen the system and expand the functionality of measures. Following this, the Sustainability Promotion Council obtained a more accurate position in the organization. The
Sustainability Department succeeds the ESG-related missions from the Environmental Engineering Department, and we will further promote our sustainability program.
Shareholders’ Meeting
Corporate Auditor
Board of Directors
Investment Committee

Compliance Committee
President & CEO

Sustainability Promotion Council

Acquisition Priority Review Meeting

Internal Audit Dept.

Compliance Dept.

Activia
Management Div.

Corporate
Management Div.

Corporate
Planning
Dept.

Human
Resources
Dept.

Finance &Accounting
Dept.

Sustainability
Dept.

Asset
Investment
Dept.

Environmental
Engineering
Dept.

Strategy
Dept.

Asset
Management
Dept.

Comforia
Management Div.

Strategy
Dept.

Asset
Management
Dept.

Broadia
Management Div.

Strategy
Dept.

Asset
Management
Dept.

49

Governance Compliance

TRM has established a Compliance Department and Compliance Committee, which ensure that compliance checks are implemented. The Compliance
Committee is a body that discusses and makes resolutions regarding conflicts of interest, transactions with related parties, internal compliance, andcompliance readiness. Compliance management is implemented in adherence to the TFHD Group Code of Conduct.

Compliance Policy

Key points of “TFHD Group Code of Conduct”
1.Ensure compliance with laws and regulations applicable to our business activities
2. As TFHD Group employee, treat our customers sincerely to maintain their trust
3. Generate a corporate culture that enables frank communication on difficult issues involving work
4. Enhance solidarity of TFHD Group and promote mutual understanding with stakeholders
5. Enforce proper management of information
6. All employees will understand and focus on ethical conducts and be a reasonable professional
7. Make efforts to create safe workplace and be considerate of the environmental conservation（Members）
General Manager of Compliance Department (Chair), representative directors, directors (if consecutively serving as General Manager of the Investment
Management Division, cannot attend Council meetings concerning REITs that the director is not in charge of), and external expert (attorney) on complianceappointed by the board of directors.
(Agenda)The Council shall resolve the following matters.
With respect to 1 to 5 , agenda shall be restricted to transactions with related parties and matters deemed necessary by the General Manager ofCompliance Department.

Compliance Committee

1. Establishment and amendment of basic investment policy concerning asset management by each REIT
2. Determination and change in acquisition or disposal of assets by each REIT and the terms and conditions thereof
3. Establishment and amendment of asset management plan by each REIT
4. Establishment and amendment of basic policy concerning asset management by each REIT
5. Establishment and amendment of basic policy concerning funding, capital policy and dividend policy for each REIT
6. Matters related to transactions with related parties (provided, however, excluding transactions defined as not requiring prior approval by theCompliance Council)
7. Preparation and amendment of the Compliance Manual and Compliance Program
8. Deliberation and resolution on improvement measures concerning inappropriate acts in terms of regulatory compliance and preventative
measures, etc.
9. Matters for which the General Manager of Compliance Department deems deliberation by the Compliance Council is necessary（Date and place）
As a general rule , the committee meets at the head office at least once every three months.

50

Governance Measure taken to enhance compliance awareness
Divisional Compliance Staff

Each year, divisional compliance staff are appointed from each division to perform periodic monitoring on compliance matters. The officers
report compliance status in his/her division and share related information.

Compliance training

In order to ensure compliance and increase awareness, we provide over twice compliance trainings each year to all officers and employees
focusing on the enforcement of the compliance basic policy and standards, and learning applicable laws and regulations, etc., and provide
orientation and follow-up (for employees new to the financial instruments business, after six months have passed since hiring).

 Internal Auditing and Monitoring System
In its internal auditing regulations, TRM has formulated an internal auditing plan, which stipulates that internal auditing shall be conducted for all departments each fiscal year, withthe exception of the Internal Audit Department. As an asset management company, with a view to investor protection and fair market formation, it audits whether tasks related toreadiness in the areas of legal compliance, internal control, risk management, crisis management, etc. are being carried out appropriately and efficiently. Furthermore, with thesupport of external professionals, it audits a wide range of items for all departments, such as the appropriateness of information management, compliance with internal rules, andadherence to the Act on Prevention of Transfer of Criminal Proceeds, and reports the audit results to TRM’s representative directors and board of directors. Matters detected by anaudit are communicated to the audited department via a ”Directive for Improvement,” and the head of the audited department that was notified implements improvement actions
and reports on the status of the improvements to the representative directors and the head of the Internal Audit Department without delay. The department in charge of auditing
also periodically verifies the status of improvements.
The 10 Principles of the UN Global Compact

 Prevention of Corruption
Corruption creates significant obstacles against sustainable development and corrodes
the social structure. TRM recognizes that commitment to prevention of corruption is an
important issue for the society and has established rules on identity confirmation fortransaction with customers, etc. in accordance with the Act on Prevention of Transfer of
Criminal Proceeds.
TFHD is a signatory to the United Nations Global Compact (UNGC), and as a Group
member, TRM supports the ten principles of UNGC. (Principle 10. Businesses should
work against corruption in all its forms, including extortion and bribery.)HumanrightsPrinciple 1: Businesses should support and respect the protectionof internationally proclaimed human rights; andPrinciple 2: make sure that they are not complicit in human rights
abusesLabourPrinciple 3: Businesses should uphold the freedom of associationand the effective recognition of the right to collective
bargaining
Principle 4: the elimination of all forms of forced and compulsory
labour:Principle 5: the effective abolition of child labour; andPrinciple 6: the elimination of discrimination in respect of
employment and occupation

Environment

Principle 7: Businesses should support a precautionary approachto environmental challenges;
Principle 8: undertake initiatives to promote greater
environmental responsibility; andPrinciple 9: encourage the development and diffusion ofenvironmentally friendly technologies

Anticorruption

Principle 10: Businesses should work against all forms ofcorruption, including extortion and bribery

Supporting International Initiatives
The TFHD Group supports and respects the OECD Guidelines for Multinational
Enterprises, international labor standards, and the UN’s Guiding Principles on
Business and Human Rights. Moreover, it declared its support for the UN Global
Compact in December 2016. It is pursuing responsible management based on the 10
principles of the UN Global Compact, which is composed of “human rights,” “labour,”“environment,” and “anti-corruption,” and contributing to the realization of a sustainable
society.

51

Governance Official Policy Against Antisocial Forces
In order to safeguard the propriety of its business activities and ensure that we are able to meet our social responsibilities and fulfill our public mission, TRM abjures dealings ofany kind with antisocial forces.
Working with legal and law enforcement bodies and other third parties, TRM is in a position to respond firmly to all improper demands. TRM’s Compliance Manual and Rules for
Responding to Antisocial Forces has established specific safeguards and procedures for responding to the actions of antisocial forces. TRM also promotes a thorough awarenessof these issues among management, employees, and other pertinent parties and provides the training needed to ensure a specific and appropriate response.

TFHD Group’s Whistle-blowing System

 Establishment of whistle-blowing system
TRM established the Compliance Helpline Counter as a contact point to report andconsult on compliance matters including when harassment and bullying is
experienced or observed, enabling all officers and employees to directly report to theCompliance Officer of TRM, General Manager of Legal Affairs Department of TLC,
General Manager of Group Legal Affairs Department of TFHD, or external attorneys.
Moreover, we pledge to maintain the confidentiality of personal information or
investigation-related information about the individual who reported or consulted on thematter and the subject of the report or consultation, which shall not be disclosed
internally or externally without good reason.

Item

FY2017FY2018FY2019FY2020

TFHD GroupFY2030 KPI

Adherence with Compliance Code of Conduct

100%

100%

100%

100%

100%

Awareness of Compliance Helpline Counter

89%

90%

87%

90%

－

（Note）Shared Group-wide criteria for TFHD Group FY2030 KPI

52

Governance Risk Management
TRM established a basic policy on the strategic targets, as well as risk management rules to implement appropriate management of risks.
(Basic Policy on Risk Management)

Basic Policy on Risk
Management

1. In accordance with our management principles, we aim to secure long-term stable revenue and maximize unitholder value by establishing amanagement system in accordance with these Rules and implementing appropriate risk management against various risks involved withengaging in investment management business.
2. Officers and employees, etc., shall recognize the importance of risk management, each be aware that they are the agent of risk management,
understand these Rules and internal rules, etc., and strictly comply with the same .
3. Risk management shall be executed with necessary and appropriate rules, detailed rules and standards, etc., being established; organizationaland resource measures implemented; and responsibilities clarified.
4. Necessary and appropriate management and supervision shall be implemented for business outsourcing partners as well as to officers andemployees, etc.
5. Risk management training, etc., shall be conducted to promote thorough awareness by officers and employees, etc., and to maintain/improve
effectiveness of the Basic Policy.
6. Basic Policy stated in this Article shall be reviewed periodically or as necessary such as when changes occur to strategic targets.

Risk management
framework

TRM conducts sophistication of its risk management framework with a certain support from external experts. Risk management function falls under the
responsibility of the Compliance Department supervised by the Compliance Officer. The Compliance Department is a stand-alone department, independent
from business operating divisions. It performs a series of risk assessment including operational risk, etc.

Risk management
training

TRM provides periodical risk management educational session with all officers and employees by external lecturers and works to improve risk
management ability of each departmentʼs members.

Information security

In order to enhance security of information assets and appropriate use of them, TRM has set forth basic rules on information security management which
stipulates principle matters related to information protection with clarifying the responsibility for information management. TRM has also established therules on IT management to stipulate appropriate management of information asset by each officer and employee according to the level of their roles andresponsibilities.

Business continuity
planning

To strengthen its resilience, TRM sets a business continuity plan, related rules and manuals, and makes updates when necessary, in preparation for
unexpected crisis such as disaster and social disruption. In accordance with these rules, we work to prevent and mitigate impact from crisis including
recent natural disasters and COVID-19. We also pay close attention to the materials and equipment used in the properties of CRR and make every effort toprevent incident by staying well informed of defect products and carrying out research.

53

GovernanceInitiatives for Governance Emphasizing Unitholders’ Value
While leveraging the TFHD Group’s value chain, CRR and TRM have developed a comprehensive governance structure aimed at maximizing CRR unitholders’value by ensuring objectivity in the asset management-related decision-making flow, aligning our interests with unitholders and sponsor, and implementing amanagement fee structure that includes management fees linked to the dividend per unit.

Securing objectivity in decision-making process
With a view to protecting the interests of unitholders, TRM has established a structure that ensures objectivity in the decision-making process for acquiring assets
under management by including third-party real estate appraisers as members of the Investment Committee.
Proposal by responsible department

Approval by Compliance Officer
In case of related-party transactions and other necessary cases

Compliance Committee deliberation and resolution (Note1)

Investment Committee deliberation and resolution(Note2)

Approval by each Chief Division Officer
In case of related-party transactions and other necessary cases

Prior approval by CRR’s board of directors(Note1)

Report to CRR

Report to the Board of Directors（Note1）Deliberation and resolution by the Compliance Committee as well as prior approval by CRR’s board of directors will be required for acquiring assets, etc.
In case of related-party transactions and other necessary cases.

（Note2）If the candidate acquisition asset is a healthcare facility, advisory from external experts related to healthcare facilities shall be sought. Furthermore, discussions shall be held upon receiving a reporton the content of reports, etc. created by external experts related to healthcare facilities and, if necessary, the Investment Committee shall be attended by the concerned external experts as observers
and their opinions shall be heard.

54

GovernanceAligning Interests Between Unitholders and the Sponsor
In the Sponsor Support Agreement, TLC has made it clear that if and when CRR decides to issue additional units, a subscription of a part of such issuance shall besincerely considered.
In the public offering held in Feb.2021, the sponsor acquired 2,137 units, which is 10% of the number of issuing units. Even in terms of capital relationship, CRR aims to
make a strong relationship with the sponsor and to achieve mutual interests improvement by aligning the interests of unitholders to that of the sponsor.

Sponsor’s investment ratio

9.0%（as of July 31, 2021）
Change in Asset Management Fee System
Under the asset management fee structure that has been applied since August 1 , 2020, Incentives have been introduced for further improvement of and growth ofunitholder value and enhanced linkage with the interests of unitholders.
Before change

Current

Total assets at the end of previous fiscal
period×0.3％（annual rate）

Total assets at the end of previous fiscal
period×0.2％（annual rate）

Management feeⅡ

Ordinary CF × 3.0％

Ordinary CF×5.4％

Management feeⅢ

Property acquisition / disposition price×1.0％

Property acquisition / disposition price×1.0％

Management fee Ⅰ（fee linked to total assets）（fee linked to profit）(acquisition and disposition fee)Management feeⅤ
（incentive）

Newly established（0.5％ in the case of transactions with related parties）―(0.5％ in the case of transactions with related parties(excluding warehousing))

Ordinary CF×growth rate of ordinary CF
per unit ×10％

Enhancing the linkage between
the interests of unitholders andasset management fees

Strengthening incentives for
growth of AUM and distributions

However, no fee will occur when the value is negative

55

GRI Content Index
GRI 100：Universal Standards
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

102: General Disclosures 2016
1. Organizational Profile
Name of the organization

102-1

https://www.comforiareit.co.jp/en/about/profile.html

Profilehttps://www.tokyu-trm.co.jp/en/profile/Profilehttps://www.comforiareit.co.jp/en/features/index.html

Basic Policies

https://www.tokyu-trm.co.jp/en/profile/Profilehttps://www.comforiareit.co.jp/en/features/index.html

Basic Policies

https://www.tokyutrm.co.jp/en/index.html

Homehttps://www.comforiareit.co.jp/en/portfolio/index.html

Portfolio List

https://www.tokyu-trm.co.jp/en/profile/Profilehttps://www.comforiareit.co.jp/en/ir/library.html

Semi-Annual Reporthttps://www.comforiareit.co.jp/en/about/profile.html

Profilehttps://www.tokyu-trm.co.jp/en/profile/ProfileNumber of countries where the organization operates,
and the names of countries where it has significant
https://www.comforiaa
operations and/or that are relevant to the topics covered reit.co.jp/en/about/profile.html
in the report.

Profilehttps://www.tokyu-trm.co.jp/en/profile/ProfileStructurehttps://www.tokyu-trm.co.jp/en/profile/ProfileProfilehttps://www.tokyu-trm.co.jp/en/profile/ProfileProfilehttps://www.tokyu-trm.co.jp/en/profile/ProfileStructure
Capital & Unitholders

https://www.tokyu-trm.co.jp/en/profile/Profilea Name of the organization
102-2

Activities, brands, products, and services
a A description of the organization’s activities.

b

102-3

Primary brands, products, and services, including an
explanation of any products or services that arebanned in certain markets.

Location of headquarters
a Location of the organization’s headquarters.

102-4

102-5

Location of operations

Ownership and legal forma Nature of ownership and legal form.

102-6

https://www.comforiareit.co.jp/en/about/structure.html

Markets served
https://www.comforiareit.co.jp/en/about/profile.html
i. geographic locations where products and services are https://www.comforiaoffered;
reit.co.jp/en/about/profile.html
https://www.comforiaii. sectors served;
reit.co.jp/en/finance/investment.html

a Markets served, including:

56

GRI Content Index
GRI 100：Universal Standards
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

102: General Disclosures 2016
1. Organizational Profileiii. types of customers and beneficiaries.
102-7

Scale of the organizationa Scale of the organization, including:i. total number of employees;
ii. total number of operations;iii. net sales (for private sector organizations) or net
revenues (for public sector organizations);
iv. total capitalization (for private sector organizations)broken down in terms of debt and equity;
v. quantity of products or services provided.

102-8

Information on employees and other workersaTotal number of employees by employment contract(permanent and temporary), by gender.

b

Total number of employees by employment contract(permanent and temporary), by region.

Total number of employees by employment type (fulltime and part-time), by gender.
Whether a significant portion of the organization’s
activities are performed by workers who are notd employees. If applicable, a description of the nature andscale of work performed by workers who are not
employees.
Any significant variations in the numbers reported inDisclosures 102-8-a, 102-8-b, and 102-8-c (such aseseasonal variations in the tourism or agriculturalindustries).
c

https://www.comforiareit.co.jp/en/finance/investment.html

Structure
Capital & Unitholders

https://www.comforiaStructure
reit.co.jp/en/about/structure.html
Due to legal restrictions, there are no
employees in the investment corporation,and management is entrusted to theasset management company, TLC REITManagement Inc.
1(Head Office only)
https://www.comforiaFinancial Highlights
reit.co.jp/en/ir/highlight.html
https://www.comforiaInterest-Bearing Debt
reit.co.jp/en/finance/index.html
https://www.comforiaPortfolio List
reit.co.jp/en/portfolio/index.html
Since the investment corporation does
not have employees due to legal
restrictions, implementations by the asset
management company's employees areapplicable to this topic.

https://www.tokyu-trm.co.jp/client/

Customer-first Business
Operation Policy (inJapanese)https://www.tokyu-trm.co.jp/en/profile/Profilehttps://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Key Employee Data

1(Head Office only)

https://www.tokyu-trm.co.jp/en/profile/Profilehttps://www.tokyu-trm.co.jp/en/attention/

About Financial
Transactions

https://www.tokyuKey Employee Datatrm.co.jp/en/sustainability/esg.html#c3
The asset management company solely
operates at the Head Office, there is noregional difference by region.
https://www.tokyuKey Employee Datatrm.co.jp/en/sustainability/esg.html#c3
Not applicable (major part of activities
are performed by employees)

No significant variations in the numbers
reported.

57

GRI Content Index
GRI 100：Universal Standards
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

102: General Disclosures 2016
1. Organizational Profile
102-9

Supply chain
A description of the organization’s supply chain,including its main elements as they relate to theaorganization’s activities, primary brands, products, andservices.

https://www.comforiareit.co.jp/en/features/basic-policy_tokyufudosan-hd.html

https://www.comforiareit.co.jp/en/about/structure.html
Significant changes to the organization and its supply chain

102-10a

Value chain of the
TOKYU FUDOSANHOLDINGS Grouphttps://www.tokyuSDGs strongly related totrm.co.jp/en/sustainability/materiality.html materiality

Structure

Significant changes to the organization’s size, structure,
ownership, or supply chain, including:https://www.comforia-reit.co.jp/file/enNotice Concerning
newsRelocation of
936eab105dbfa5389004f823f8ee219f283 Headquarters of
0810c.pdf
Investment Corporation
Notice Concerning
https://www.comforia-reit.co.jp/file/enChanges innewsOrganizational Structure
27f291350345913813f1e0345b02f3d309
of the Assetb06ce7.pdf
Management Company
Notice Concerning
i. Changes in the location of, or changes in, operations,
Changes inhttps://www.comforia-reit.co.jp/file/enincluding facility openings, closings, and expansions;
Organizational Structure,
news251115e1b5ae3ff5601c20b8439813ed27 etc. and Directors of theAsset Management
4f9533.pdf
Company
Notice Concerning
Change of President &https://www.comforia-reit.co.jp/file/enhttps://www.tokyunewsCEO and Appointment of
trm.co.jp/en/common/pdf/info_2106_en.
b4100311cc3374acb5d18e397325e1465f Chairman and Directors
pdf
59dc18.pdf
of the AssetManagement Company
ii. Changes in the share capital structure and othercapital formation, maintenance, and alteration
No significant changes
No significant changes
operations (for private sector organizations);iii. Changes in the location of suppliers, the structure of
the supply chain, or relationships with suppliers,
No significant changes
No significant changes
including selection and termination.

Notice Concerning
Change of President &CEO and Appointment ofChairman58

GRI Content Index
GRI 100：Universal Standards
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

102: General Disclosures 2016
1. Organizational Profile
102-11

Precautionary Principle or approacha Whether and how the organization applies the
Precautionary Principle or approach.

102-12https://www.comforiareit.co.jp/en/sustainability/index.html

Sustainability Policy

Sustainability Policies

https://www.tokyutrm.co.jp/en/sustainability/esg.html

Risk Management

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c5

International Initiatives

External initiatives
TLC REIT Management Inc., the asset
management company of the Investment
corporation, is a GRESB Member, andA list of externally-developed economic, environmental
Tokyu Fudosan Holdings Corporation is aa and social charters, principles, or other initiatives tosignatory of the United Nations Global
which the organization subscribes, or which it endorses.
Compact. The investment corporation is
operated along with the support for these
initiatives.

102-13https://www.tokyutrm.co.jp/en/sustainability/index.html

Membership of associations
A list of the main memberships of industry or otherassociations, and national or international advocacy
organizations.

"The Investment Trusts Association,
Japan The Association for Real Estate
Securitization GRESB Real Estate"

2. Strategy
102-14

Statement from senior decision-makerA statement from the most senior decision-maker of theorganization (such as CEO, chair, or equivalent seniorhttps://www.comforiaa position) about the relevance of sustainability to thereit.co.jp/en/about/index.html
organization and its strategy for addressing
sustainability.

102-15

Greetings

https://www.tokyu-trm.co.jp/en/message/ Message

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html

https://www.tokyuMateriality
trm.co.jp/en/sustainability/materiality.html

Key impacts, risks, and opportunities
a A description of key impacts, risks, and opportunities.

59

GRI Content Index
GRI 100：Universal Standards
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

102: General Disclosures 2016
3. Ethics and Integrity
Values, principles, standards, and norms of102-16
behavior
A description of the organization’s values, principles,astandards, and norms of behavior.

102-17

Mechanisms for advice and concerns about ethics

4. Governance102-18Governance structureaGovernance structure of the organization, including
committees of the highest governance body.

Committees responsible for decision-making onbeconomic, environmental, and social topics.
102-19102-20Delegating authority

Executive-level responsibility for economic,
environmental, and social topics
Whether the organization has appointed an executivea level position or positions with responsibility foreconomic, environmental, and social topics.
Whether post holders report directly to the highestbgovernance body.

102-21

https://www.comforiaFeature & Strategy
reit.co.jp/en/features/index.html
Since the investment corporation does
not have employees due to legal
restrictions, implementations by the asset
management company's employees areapplicable to this topic.

https://www.comforiareit.co.jp/en/about/profile.html
https://www.comforiareit.co.jp/en/about/structure.html
https://www.comforiareit.co.jp/en/sustainability/index.html
https://www.comforiareit.co.jp/en/about/governance.html

Officers
Structure
Promotion System
Operational system of
the Investment
Corporation

https://www.tokyutrm.co.jp/en/philosophy/

Philosophy

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c4

Establishment of whistleblowing system

https://www.tokyu-fudosanhd.co.jp/english/about/compliance/

Establishment ofCompliance Helpline

https://www.tokyu-trm.co.jp/en/profile/Profilehttps://www.tokyutrm.co.jp/en/organization/
https://www.tokyutrm.co.jp/en/sustainability/

Organization
Promotion System

https://www.tokyutrm.co.jp/en/sustainability/

Promotion System

https://www.comforiaStructure
reit.co.jp/en/about/structure.html
Due to the organizational characteristics,
the responsible officer is appointed in theasset management company.
https://www.comforiareit.co.jp/en/sustainability/index.html

Promotion System

https://www.tokyutrm.co.jp/en/sustainability/

Promotion System

https://www.comforiareit.co.jp/en/sustainability/index.html

Promotion System

https://www.tokyutrm.co.jp/en/sustainability/

Promotion System

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c2

Commitment toEnvironment

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Commitment to Society

Consulting stakeholders on economic, environmental, and social topics
Processes for consultation between stakeholders anda the highest governance body on economic,
environmental, and social topics.

SDGs with close
https://www.comforiarelevance to thereit.co.jp/en/sustainability/materiality.html
Materiality

60

GRI Content Index
GRI 100：Universal Standards
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

102: General Disclosures 2016
4. Governance
Composition of the highest governance body andits committees

102-22https://www.comforiareit.co.jp/en/about/structure.html

Structurehttps://www.comforiareit.co.jp/file/ir_library_other_file-tmpWKMYF.pdf

Articles of Incorporation(in Japanese)

Nomination and selection processes for the highest
governance body and its committees.

https://www.comforiareit.co.jp/file/ir_library_other_file-tmpWKMYF.pdf

Articles of Incorporation(in Japanese)

Criteria used for nominating and selecting highest
b governance body members, including whether andhow:https://www.comforiareit.co.jp/file/ir_library_other_file-tmpWKMYF.pdf

Articles of Incorporation(in Japanese)

https://www.comforiareit.co.jp/en/about/governance.html

Governance System

102-23Chair of the highest governance body102-24

Nominating and selecting the highest governancebodyahttps://www.tokyutrm.co.jp/en/organization/
https://www.tokyu-trm.co.jp/en/profile/

Executive Board

https://www.tokyu-trm.co.jp/en/profile/

Executive Board

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c4

Compliancehttps://www.tokyu-trm.co.jp/en/profile/ProfileOrganization

i. stakeholders (including shareholders) are involved;
ii. diversity is considered;iii. independence is considered;iv. expertise and experience relating to economic,
environmental, and social topics are considered.
102-25

Conflicts of interest
Processes for the highest governance body to ensureaconflicts of interest are avoided and managed.

b

Whether conflicts of interest are disclosed to
stakeholders, including, as a minimum:https://www.comforiaReport on Management
reit.co.jp/file/ir_library_other_fileStructure of the REIT
8424ef7042812af3a0c537150cb119209c
Issuer (in Japanese)
f3e368.pdf

i. Cross-board membership;
ii. Cross-shareholding with suppliers and otherstakeholders;iii. Existence of controlling shareholder;

61

GRI Content Index
GRI 100：Universal Standards
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

102: General Disclosures 2016
4. Governanceiv. Related party disclosures.
102-26102-27102-28102-29

Role of highest governance body in setting purpose, values, and strategy
Highest governance body’s and senior executives’roles in the development, approval, and updating of thehttps://www.comforiaa organization’s purpose, value or mission statements,
reit.co.jp/en/sustainability/index.html
strategies, policies, and goals related to economic,
environmental, and social topics.
Collective knowledge of highest governance body

Promotion System

Measures taken to develop and enhance the highest
a governance body’s collective knowledge of economic,
environmental, and social topics.
Evaluating the highest governance body’s
performance
Processes for evaluating the highest governancea body’s performance with respect to governance ofeconomic, environmental, and social topics.

Promotion System

https://www.tokyutrm.co.jp/en/sustainability/esg.html

Performance Evaluation
Process

https://www.tokyutrm.co.jp/en/sustainability/esg.html

Performance Evaluation
Process

Identifying and managing economic, environmental, and social impacts
Highest governance body’s role in identifying andmanaging economic, environmental, and social topics
a and their impacts, risks, and opportunities – including
its role in the implementation of due diligenceprocesses.

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html

https://www.tokyutrm.co.jp/en/sustainability/materiality.ht
mlMateriality

Whether stakeholder consultation is used to support
the highest governance body’s identification andbmanagement of economic, environmental, and social
topics and their impacts, risks, and opportunities.

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html

https://www.tokyutrm.co.jp/en/sustainability/materiality.ht
mlMateriality

102-30Effectiveness of risk management processes

https://www.comforiareit.co.jp/en/about/governance.html

Governance System

102-31

Review of economic, environmental, and social
topicshttps://www.comforiareit.co.jp/en/sustainability/index.html

Promotion System

Frequency of the highest governance body’s review ofa economic, environmental, and social topics and theirimpacts, risks, and opportunities.
Highest governance body’s role in sustainability
reportinghttps://www.comforiareit.co.jp/en/sustainability/index.html

Promotion System

102-32https://www.tokyutrm.co.jp/en/sustainability/

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c4
https://www.tokyutrm.co.jp/en/sustainability/index.html

https://www.tokyutrm.co.jp/en/sustainability/index.html

Efforts on Governance
Promotion System

Promotion System

62

GRI Content Index
GRI 100：Universal Standards
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

102: General Disclosures 2016
4. Governance102-34Nature and total number of critical concerns

102-35

Remuneration policies

No critical concerns reported during thereporting period.

Remuneration policies for the highest governance body https://www.comforiaa and senior executives for the following types ofreit.co.jp/file/ir_library_other_file-tmpremuneration:
WKMYF.pdf

No critical concerns reported during thereporting period.

Articles of Incorporation(in Japanese)i. Fixed pay and variable pay, including performancebased pay, equity-based pay, bonuses, and deferred or
vested shares;
ii. Sign-on bonuses or recruitment incentive payments;
iii. Termination payments;
iv. Clawbacks;
v. Retirement benefits, including the difference
between benefit schemes and contribution rates for thehighest governance body, senior executives, and allother employees.
5. Stakeholder Engagement102-40

List of stakeholder groupsa102-41

Percentage of total employees covered by collective
bargaining agreements.

Examples of initiatives

https://www.tokyutrm.co.jp/en/sustainability/esg.html

Our commitment

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

100%

Approach to stakeholder engagement
The organization’s approach to stakeholder
engagement, including frequency of engagement by
a type and by stakeholder group, and an indication ofwhether any of the engagement was undertaken
specifically as part of the report preparation process.

102-44https://www.comforiareit.co.jp/en/sustainability/examples.html

Collective bargaining agreementsa102-43A list of stakeholder groups engaged by theorganization.

Key topics and concerns raised

https://www.comforiareit.co.jp/en/sustainability/examples.html
No key topics or concerns raised

Examples of initiatives

https://www.tokyutrm.co.jp/en/sustainability/esg.html

Our commitment
Commitment to Society

No key topics or concerns raised

63

GRI Content Index
GRI 100：Universal Standards
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

102: General Disclosures 2016
6．Reporting PracticeNone

TLC REIT Management Inc.is 100%
subsidiary of Tokyu Fudosan Holdings
Corporation and subjected toconsolidated financial statements.

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html

https://www.tokyutrm.co.jp/en/sustainability/materiality.ht
mlMateriality

A list of the material topics identified in the process fordefining report content.

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html

https://www.tokyutrm.co.jp/en/sustainability/materiality.ht
mlMateriality

102-48

Restatements of information

Nothing in particularNothing in particular

102-49Changes in reporting

Nothing in particularNothing in particular

102-50

Reporting period

Sustainability
https://www.comforiainformation disclosure
reit.co.jp/en/sustainability/disclosure.html
and GRI Index

https://www.tokyutrm.co.jp/en/sustainability/gri.html

102-51

Date of most recent report

Not applicableNot applicable

102-52

Reporting cycle

Sustainability
https://www.comforiainformation disclosure
reit.co.jp/en/sustainability/disclosure.html
and GRI Index

https://www.tokyutrm.co.jp/en/sustainability/gri.html

Sustainability information
disclosure and GRI Index

102-53

Contact point for questions regarding the reporthttps://www.comforiareit.co.jp/en/contact/index.html

https://www.tokyu-trm.co.jp/en/contact/

Contact Us

102-54Claims of reporting in accordance with the GRI
Standards

Sustainability reporting is prepared withreference to GRI standards

Sustainability reporting is prepared withreference to GRI standards

102-55

GRI content index

GRI Content Index (this table)

GRI Content Index (this table)

102-56External assurance

None

None

102-45

Entities included in the consolidated financial
statements

102-46

Defining report content and topic Boundariesa102-47

An explanation of the process for defining the reportcontent and the topic Boundaries.
List of material topicsaContact us

Sustainability information
disclosure and GRI Index

64

GRI Content Index
GRI 200：Economic
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

Management Approach
103-1

Explanation of the material topic and its Boundary

103-2

The management approach and its components

103-3

Evaluation of the management approach

201：Economic Performance 2016201-2

https://www.comforiareit.co.jp/en/sustainability/examples.html
https://www.comforiareit.co.jp/en/sustainability/index.htm

Examples of initiatives
Promotion System

https://www.tokyutrm.co.jp/en/sustainability/materiality.ht
mlhttps://www.tokyutrm.co.jp/en/sustainability/esg.html
https://www.tokyutrm.co.jp/en/sustainability/

Materiality
Our Commitment
Promotion System

Financial implications and other risks and opportunities due to climate change

Risks and opportunities posed by climate change thata have the potential to generate substantive changes inoperations, revenue, or expenditure, including:
205：Anti-corruption 2016

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html

Since the investment corporation does
not have employees due to legal
Operations assessed for risks related to corruption restrictions, implementations by theasset management company's
employees are applicable to this topic.

205-1

205-2

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html

aTotal number and percentage of operations assessed
for risks related to corruption.

b

Significant risks related to corruption identified throughthe risk assessment.
Communication and training about anti-corruption
policies and procedures

https://www.tokyutrm.co.jp/en/sustainability/materiality.ht
mlMateriality

１（The asset management company
solely operates at the Head Office）,
100%
None

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

Total number and percentage of governance bodyd members that have received training on anti-corruption,broken down by region.
Total number and percentage of employees that havee received training on anti-corruption, broken down by
employee category and region.
Confirmed incidents of corruption and actions
205-3
No incidents
taken
206： Anti-competitive Behavior 2016
Legal actions for anti-competitive behavior, anti206-1
No incidents
trust, and monopoly practices

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c4

Compliance Training

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c4

Compliance Training

No incidents

No incidents

65

GRI Content Index
GRI 300：Environmental
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

Management Approach
103-1

Explanation of the material topic and its Boundary

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html

https://www.tokyutrm.co.jp/en/sustainability/materiality.ht
mlMateriality

103-2

The management approach and its components

https://www.comforiareit.co.jp/en/sustainability/examples.html

Examples of initiatives

https://www.tokyutrm.co.jp/en/sustainability/esg.html

Our Commitment

103-3

Evaluation of the management approachhttps://www.comforiareit.co.jp/en/sustainability/index.html

Promotion System

https://www.tokyutrm.co.jp/en/sustainability/index.html

Promotion System

307：Environmental Compliance 2016
307-1

Non-compliance with environmental laws andregulations

No violations during the reporting period

No violations during the reporting period

66

GRI Content Index
GRI 400：Social
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

Management Approach
103-1

Explanation of the material topic and its Boundary

103-2

The management approach and its components

103-3

Evaluation of the management approach

401：Employment 2016
401-1

New employee hires and employee turnover
Total number and rate of new employee hires during
the reporting period, by age group, gender and region.
Total number and rate of employee turnover during thebreporting period, by age group, gender and region.

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html
https://www.comforiareit.co.jp/en/sustainability/examples.html
https://www.comforiareit.co.jp/en/sustainability/index.html
Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

a

401-2

Benefits provided to full-time employees that are
not provided to temporary or part-time employees

401-3

Parental leave

403：Occupational Health and Safety 2018403-2

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.
Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

Since the investment corporation does
not have employees due to legal
Hazard identification, risk assessment, and incident
restrictions, implementations by theinvestigation
asset management company's
employees are applicable to this topic.

A description of the processes used to identify workrelated hazards and assess risks on a routine and nona routine basis, and to apply the hierarchy of controls inorder to eliminate hazards and minimize risks,
including:

Examples of initiatives
Promotion System

https://www.tokyutrm.co.jp/en/sustainability/materiality.ht
mlhttps://www.tokyutrm.co.jp/en/sustainability/esg.html
https://www.tokyutrm.co.jp/en/sustainability/index.html

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3
https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Materiality
Our Commitment
Promotion System

New Hire
Turnover ratio

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Employee welfare
programs (representative
examples)

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Status of Work-Style
Reform and Diversity
Promotion

https://www.tokyutrm.co.jp/en/sustainability/esg.html

Health Committee

Implementation of health committee,
feedback through workplace inspections
by industrial doctos, confirmation ofworking hours of all officers andemployees, implementation of feedback
and lectures based on periodic stresschecks, etc.

67

GRI Content Index
GRI 400：Social
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

403：Occupational Health and Safety 2018
A description of the policies and processes for workers
to remove themselves from work situations that theyc believe could cause injury or ill health, and an
explanation of how workers are protected against
reprisals.

403-4

403-5

403-6

403-9

403-10

Lectures by industrial doctors, individualinterviews with industrial doctors, andfeedback to superiors

Worker participation, consultation, andcommunication on occupational health and safety

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

Employees also take part in the healthcommittee disclosed below.
https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Health Committee

Worker training on occupational health and safety

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

Carrying out lectures by industrial
doctors and planned classes related toharassment.
https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Various employee
training programs HealthCommittee

Promotion of worker health

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

Carrying out stress checks and regular
health checks.
https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Our Commitment Status
of Work-Style Reformand Diversity Promotion

Work-related injuries

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Status of Work-Style
Reform and Diversity
Promotion

Work-related ill health

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Status of Work-Style
Reform and Diversity
Promotion

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Various employee
training programs(examples ofrepresentative cases)

404：Training and Education 2016

404-1

Average hours of training per year per employee

68

GRI Content Index
GRI 400：Social
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

404：Training and Education 2016

404-2

404-3

Programs for upgrading employee skills andtransition assistance programs

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Percentage of employees receiving regularperformance and career development reviews

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.

Both contracted employees and regular
employees receive performance andcareer development reviews in the
Performance Evaluation
same structure, and aim to set the goals
Processand communicate with superiors.
https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Percentage of total employees by gender and by
employee category who received a regularperformance and career development review during thereporting period.
405：Diversity and Equal Opportunity 2016405-1
Diversity of governance bodies and employeesaPercentage of individuals within the organization’s
a governance bodies in each of the following diversity
categories:
i. Gender;100%

https://www.comforiareit.co.jp/en/about/profile.html

Officers

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

https://www.comforiareit.co.jp/en/about/profile.html

Officers

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Officers(in Japanese)

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

ii. Age group: under 30 years old, 30-50 years old, over https://www.comforia50 years old;
reit.co.jp/ja/about/profile.htmlbPercentage of employees per employee category ineach of the following diversity categories:

i. Gender;

Employee Development

Key Employee Data
Status of Work-Style
Reform and Diversity
Promotion
Key Employee Data
Status of Work-Style
Reform and Diversity
Promotion
Key Employee Data
Status of Work-Style
Reform and Diversity
Promotion

Since the investment corporation does
not have employees due to legal
restrictions, implementations by theasset management company's
employees are applicable to this topic.
https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Key Employee Data
Status of Work-Style
Reform and Diversity
Promotion

69

GRI Content Index
GRI 400：Social
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

405：Diversity and Equal Opportunity 2016

405-2

ii. Age group: under 30 years old, 30-50 years old, over
50 years old;

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

iii. Other indicators of diversity where relevant (such as
minority or vulnerable groups).

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Ratio of basic salary and remuneration of women to There is no gender difference for eachmen
employee category.

There is no gender difference for each
employee category.

No incidents during the reporting period

No incidents during the reporting period

No incidents during the reporting period

No incidents during the reporting period

406：Non-Discrimination 2016
Incidents of discrimination and corrective actions
406-1
taken

411：Rights of Indigenous Peoples 2016
Incidents of violations involving rights of
411-1
indigenous peoples

Key Employee Data
Status of Work-Style
Reform and Diversity
Promotion
Key Employee Data
Status of Work-Style
Reform and Diversity
Promotion

413：Local Communities 2016413-1

Operations with local community engagement,
impact assessments, and development programs

https://www.comforiareit.co.jp/en/sustainability/examples.html

Examples of initiatives

https://www.tokyutrm.co.jp/en/sustainability/esg.html

Our Commitment

Note: We report information on our properties inconsideration of the purpose of this standard.

https://www.comforiareit.co.jp/en/sustainability/examples.html

Initiatives in local
communities

https://www.tokyutrm.co.jp/en/sustainability/esg.html#c3

Contribution to the region

414： Supplier Social Assessment 2016
Negative social impacts in the supply chain and414-2
actions taken
415：Public Policy 2016
415-1

Political contributions

No suppliers were screened during thereporting period
No political contributions provided

No political contributions provided

416：Customer Health and Safety 2016
416-1

Assessment of the health and safety impacts ofproduct and service categories

https://www.comforiareit.co.jp/en/sustainability/examples.html

416-2

Incidents of non-compliance concerning the healthand safety impacts of products and services

No violations during the reporting period

Non-compliance with laws and regulations in thesocial and economic area

No violations during the reporting period

Initiatives to improvetenant satisfaction

419：Socioeconomic Compliance 2016419-1

No violations during the reporting period

70

GRI Content Index
GRI G4: Construction and Real Estate Sector Disclosures
Disclosure

CRR

TRM

Location or reason for omission

Location or reason for omission

Management Approach
103-1

Explanation of the material topic and its Boundary

https://www.comforiaMateriality
reit.co.jp/en/sustainability/materiality.html

https://www.tokyutrm.co.jp/en/sustainability/materiality.ht
mlMateriality

103-2

The management approach and its components

https://www.comforiareit.co.jp/en/sustainability/examples.html

Examples of initiatives

https://www.tokyutrm.co.jp/en/sustainability/esg.html

Our Commitment

103-3

Evaluation of the management approachhttps://www.comforiareit.co.jp/en/sustainability/index.html

Promotion System

https://www.tokyutrm.co.jp/en/sustainability/index.html

Promotion System

CRE8Type and number of sustainability certification,
rating and labeling schemes for new construction,
management, occupation and redevelopment

https://www.comforiaEnvironmental
reit.co.jp/en/sustainability/evaluation.html Certification

CRE

71

Independent Assurance Statement72