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* Detailed data related to SDGs and ESG are collected separately in SDGs Data Edition.
SDGs Data Edition 2020

https://www.daiwa-grp.jp/english/sdgs/data/pdf/daiwa̲sdgs̲data̲2020.pdf* As a digest version of the SDGs Data Book, we also publish "SDGs Booklet," a compact and easy-to-understandsummary of our way of thinking about the SDGs and the details of various initiatives.
SDGs Booklet

https://www.daiwa-grp.jp/english/sdgs/data/pdf/daiwa̲sdgs̲booklet̲2020.pdf

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SDGs report 2020

Our strategy for achieving SDGs
Ful ll our role as a securities company toachieve the SDGs.

Seiji Nakata

President and CEO, Daiwa Securities Group Inc.
Message from CEO

September 2015
Adopted SDGs (Sustainable Development Goals)
The SDGs (Sustainable Development Goals) are the 17 common goals of humankind that were created by UN member countries,
various organizations and people, and adopted by the United Nations in 2015. It has been promised that each country will actively
work to achieve these goals. Daiwa Securities Group considers the SDGs to be important goals that give direction to the world, and willapproach social issues as an important common language when conducting business in Japan and overseas.
Our Values and SDGs Materiality

Statements

February 2018
Established "SDGs Promotion Committee"
In 2018, we established the SDGs Promotion Committee chaired by Seiji Nakata, President and CEO. External committee members
always participate to bring in fresh ideas and cutting-edge information from outside the company, and we are making Group-widee orts to contribute to the SDGs.
Structure of SDGs Promotion2

SDGs report 2020

April 2018
Formulation of "Medium-Term Management Plan (FY'Passion for the Best' 2020"-FY)

In our Medium-term Management Plan "Passion for the Best" 2020, the basic policy is to "provide high value-added solutions throughour No. 1 quality consulting capabilities" and "provide new value as a hybrid comprehensive securities group." We aim to be a "pioneerin the nancial and capital markets that creates the future," which creates a virtuous cycle of expanding customers' assets and growing
the companies that drive the Japanese economy.
We have incorporated the SDGs perspective as the basis of our business strategy in this Medium-term Management Plan.

May 2018
Announcement of "Daiwa Securities Group SDGs Declaration (Passion
for SDGs 2018)"
The SDGs Promotion Committee has clearly stated that we will actively promote initiatives that contribute to the SDGs through ourGroup business in the "Daiwa Securities Group SDGs Declaration (Passion for SDGs 2018)." The Group will deepen its e orts to achieve
the SDGs based on this declaration.

Daiwa Securities Group SDGs Declaration(Passion for SDGs 2018)3

SDGs report 2020

May 2019
Announcement of SDGs Materiality and SDGs Promotion Action Plan
In order to promote the SDGs in the entire Group, we believe that not only top-down promotion but also bottom-up e orts byemployees are important, and we solicited a wide range of SDGs-related initiatives and ideas from employees. When soliciting ideas,
we incorporated two perspectives: Forecasting that considers what we can do now, and Backcasting that considers what we can dobased on the "ideal image" of the Group in 2030, the deadline for achieving the SDGs As a result, for Forecasting we gathered morethan 4,200 ideas not only from the headquarters departments, but also from branch o ces in Japan, Group companies, and overseas
bases. In the Backcasting approach, about 120 volunteers gathered through internal recruitment and made a proposal for therealization of the Group's 2030 vision.
We identi ed issues from this bottom-up initiative, and summarized them by collating them with the demands from society, which we
uncovered through communication with stakeholders and the knowledge of outside experts. Then, after discussions at the SDGs
Promotion Committee, we nalized the "Daiwa Securities Group's Priority Issues (SDGs Materiality)."
Furthermore, from this bottom-up initiative, we identi ed the matters that should be focused on to solve the priority issues, andcompiled the "Passion for SDGs 2019 -Daiwa Securities Group Action Plan-."SDGs Materiality identi cation process

Passion for SDGs 2019 -Daiwa Securities Group Action Plan-

May 2020
Announcement of SDGs Promotion KPIs for FY
We have only 10 years left before 2030, the deadline for achieving the SDGs. Aiming to build a “Daiwa version of an SDG value chain”
that generates a sustainable ow of funds, in order to accelerate the initiatives of our SDGs promotion action plan, we have set SDGs
promotion KPIs for each action theme for this scal year, and have started trial operation. Based on these KPIs, we will monitor the
status of progress and make revisions if necessary, aiming for full-scale operation in the next scal year and beyond.
Passion for SDGs -Daiwa Securities Group Action Plan-

4

SDGs report 2020

Now, and looking to 2030
Moving forward to 2030, we are formulating “2030 Vision” for all executives and employees to share what the Group wants to be andwhat the Group should be, and to work as one on the creation of shared values.
The Daiwa Securities Group will continue to work on initiatives for the resolution of social issues that incorporate the SDGs
perspective, and will also make e orts to ensure that e ective initiatives take root in society.

SDGs(Sustainable Development Goals）

International goals up to 2030 adopted by the United Nations Summit in September 2015. 17 goals and 169 targets were set
to realize a sustainable world. The SDGs question the ideal state of not only developing countries but also advanced
countries including Japan, and pledge that "No one will be left behind" in the process of the initiatives.

5

SDGs report 2020

Message from CEO
We will ful ll our role as an integrated securities group toward achieving the
SDGs

Seiji Nakata
President and CEO
Daiwa Securities Group Inc.

We have only 10 years to achieve the SDGs by 2030.
In realizing a sustainable society, we must initiate action more proactively.
Above all, prompt decision making is now needed in the face of a world of acceleratingchange due to the COVID- pandemic and frequent natural disasters.
Looking ahead to the next 10 years, we will further strengthen collaborative
relationships with all stakeholders. As top management, I will also endeavor to develop
mechanisms for the sustainable ow of funds, so that initiatives that are e ective insolving issues will not stagnate through shortage of funds.
As part of our commitment to SDGs, we created a new post of Head of SDGs from thisscal year, appointing a suitable executive, well-versed in overseas developments, who
has worked alongside me with even greater enthusiasm in promoting the SDGs. We willcontinue to develop a system within the Group that enables all business contributing to
the SDGs to be implemented speedily.
We will continue to work proactively to solve social issues to remain a company that isneeded by society in the next 100 years. We appreciate your continued interest in ourGroup philosophy.

Message from the Head of SDGs

Keiko Tashiro
Deputy President
Head of Overseas and SDGs
Daiwa Securities Group Inc.

Realizing a sustainable society has become the standard basis for management
worldwide, and initiatives aimed at achieving the SDGs are no longer the exception forbusinesses. Daiwa Securities Group took the lead in the industry, introducing SDGs as
the foundation for its management in 2018, and continues to drive initiatives companywide through the SDGs Promotion Committee.
The deadline for achieving the SDGs is just 10 years away.
Now, as the COVID- pandemic and large-scale natural disasters have pushed society
towards a signi cant turning point, the signi cance of the SDGs is growing. Conscious of
the situation worldwide, we are further accelerating initiatives that we are able toimplement as a comprehensive securities group. Through them, we hope to secure abreakthrough in these unprecedented circumstances, which we must apply for resolving
the various challenges indicated in the 17 Goals.
Consequently, from FY 2020, we have set KPIs so that those responsible for SDGs in eachheadquarters department and Group company can quantitatively monitor theirprogress for achieving the SDGs.
In 2008, we issued the rst “Vaccine Bonds” in Japan, and since then, as a pioneer of
SDG bonds, we have strived to resolve social issues through our business. We willcontinue to lead the industry and to raise and meet the expectations of all of our
stakeholders through initiatives that Daiwa Securities Group is uniquely capable of.
6

SDGs report 2020

Our Values and SDGs Materiality
Corporate Principles
Amid rapid changes in the world, such as social conditions and the global environment, the Daiwa Securities Group values
its Corporate Principles as "something that never changes."

Building trust

The trust and approval of customers form the very foundation of the Daiwa Securities Group.
The Group will always place the needs of customers rst, and strive to develop the advanced,
specialized skills to o er them the most attractive products and services of any securities group.

The source of the Group's competitiveness lies in the capabilities of its employees. The Group
Placing importance will promote the creativity of employees by o ering them a challenging and self-directedworking environment that encourages their abilities and appropriately rewards theiron personnel
contributions.

Contributing tosociety

The Daiwa Securities Group will seek to bene t the economy and society through thedevelopment of healthy nancial markets. In addition to scrupulously observing both
regulations and internal policies, the Group will strive to maintain a high sense of morality andduty, endeavoring to continue contributing to the sustainable growth of the societies in which
we operate.

Maintaining
healthy earnings
results

The Group will always seek to develop healthy business operations and to increase corporate
value for the bene t of shareholders. By providing customers with attractive products andservices, the Daiwa Securities Group will seek to generate strong pro ts and healthy returns forshareholders.

Daiwa Spirit
Our corporate culture has been nurtured since the foundation of our business. After analyzing it using our corporate
principle as a compass, we sorted out the basic philosophy and mindset inherent in our group and articulated them as the
Daiwa Spirit, our behavioral guidelines.

1. Exercises self-discipline and complies fully with the law, recognizing that sustainable growth hinges on winning
the trust of customers, nancial and capital markets, and society at large.

2. Secures sound pro ts by contributing to societal and economic development through its actions in nancial andcapital markets.

3. Exerts un agging e orts to build strong, sustainable, trust-based customer relations.
4. Continues to pioneer products and services in nancial and capital markets, with each employee ful lling his/her
mission with con dence and pride.

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SDGs report 2020

5. Cultivates unbeatable competitiveness to overcome challenges, underpinned by strong company-employee trustand solidarity between colleagues.

6. Aims to be the securities group with the highest ambitions, a positive attitude that turns hardships into
opportunity, and unmatched speed.

Daiwa Securities Group SDGs Materiality (Priority Issues)
Among various social issues, we have identi ed as priority issues matters that should be addressed in particular in consideration of theGroup’s management strategies and business characteristics.
We position "Finance," "Technology," "Local Community," and "Life" as priority issues for business areas, while identifying "Corporate
Governance," "Compliance," and "Risk Management" as priority issues for fundamental areas that support these business areas.

8SDGs report 2020

Process of Identifying SDGs Materiality
Up until now, the Group has used its Corporate Principles as its foundation, with "CSR Priority Issues" and "SDGs Materiality" as thebasis of its CSR activities.
In 2018, we established the "SDGs Promotion Committee" chaired by Seiji Nakata, President and CEO, and we clearly stated in our"Passion for SDGs - Daiwa Securities Group SDGs Declaration -" that we would actively promote initiatives that contribute to the SDGs
through our Group business.
Based on this declaration, we have gathered information on a wide range of initiatives related to the SDGs. In addition, we establisheda SDGs working group of voluntary employees and examined the ideal image of the Group. From the cases we gathered information
on, we identi ed the initiatives that should now be deepened further and new issues to be started in the Group.
We summarized the issues identi ed from this bottom-up analysis by collating them with the demands from society, which we
uncovered through communication with stakeholders and the knowledge of outside experts. Then, after discussions at the SDGs
Promotion Committee, we nalized the "Daiwa Securities Group's SDGs Materiality."

SDGs Promotion Action Plan
From the bottom-up initiative mentioned above, we identi ed the matters that should be focused on to solve the priority issues andcompiled the "Passion for SDGs -Daiwa Securities Group Action Plan.”
In FY , to monitor the progress of the Action Plan, we established SDGs promotion KPIs and initiated trial operation. Full-scale
operation is planned for the next scal year and beyond.
Passion for SDGs -Daiwa Securities Group Action Plan-

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SDGs report 2020

Statements
Introducing Daiwa Securities Group's various statements.

Management
Daiwa Spirit [PDF: 80 KB]
Daiwa Securities Group SDGs Materiality (Priority Issues)

Corporate Principles
Management Policy
Policy on Communication with Stakeholders

SDGs/ESG in general
Daiwa Securities Group Action Plan
Daiwa Real Estate Asset Management Co.Ltd. "ESG Policy"
Daiwa Capital Markets Europe Ltd. "Corporate Social
Responsibility"

Daiwa Securities Group’s SDGs Declaration
Daiwa Asset Management Co. Ltd. "ESG Investment Policy"
Daiwa Capital Markets America Inc. "Corporate Social
Responsibility"

Environment
Environmental Vision, Environmental Principles, and Basic Environmental Policies

10SDGs report 2020Society
Customer support
Basic Policy on Customer- rst Operations
Daiwa Securities Group
Daiwa Securities Co. Ltd.
Daiwa Asset Management Co. Ltd.
Daiwa Next Bank, Ltd

Human Resources/Human Rights

Guidelines for Fair Hiring

Daiwa Securities Group “Basic Policy for Initiatives Addressing
Human Rights and Social Integration Issues”
Daiwa Capital Markets Europe Ltd. "Diversity & Equality"

Structure to Promote Health Management (About HealthManagement Promotion System, Three-Part System)
Daiwa Capital Markets Europe Ltd. "Modern Slavery Act 2015"

Daiwa Capital Markets America Inc. "WORK FOR US" >"Culture"

Investment

Daiwa Asset Management "Investment and Other Activities Related to Cluster Bomb Manufacturing Companies"

GovernanceCorporate Governance

Basic Views on Corporate GovernanceDirector Candidate Selection Policy, Outside Director
Selection Criteria, etc. [PDF: 640 KB]

Basic Policy to O cer Remuneration [PDF: 685 KB]

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SDGs report 2020

Compliance
Privacy Policy
Daiwa Securities Group
Daiwa Securities Co. Ltd.
Daiwa Asset Management Co. Ltd.

About the Group's Customer Con rmation System
Basic Policy on Avoiding Involvement with Anti-Social Forces
Management Policy for Con ict of Interest
Daiwa Securities Group
Daiwa Securities Co. Ltd.
Daiwa Asset Management Co. Ltd.

Information disclosure

Disclosure Policy

Risk Management

Risk Appetite Framework [PDF: 643 KB]

Tax a airs

Daiwa Securities Group "Tax Policy"

Daiwa Capital Markets Europe "UK Tax Strategy"

Japan's Stewardship Code

Daiwa Securities "Accepting the Japanese Stewardship Code"

Daiwa Asset Management Co. Ltd. "About Stewardship
Activities"

12

SDGs report 2020

Structure of SDGs Promotion
Daiwa Securities Group established the SDGs Promotion Committee in 2018 as the decision-making organization for the Group’s
policies on SDGs promotion. The details of the Committee’s discussions are regularly reported to the Board of Directors and the
Executive Management Committee and are deliberated on by those bodies where appropriate.
We always invite external experts to the Committee, and this has enabled the Committee to utilize the experience and insights of thoseexperts in their discussions.
Based on decisions made by the Committee, we are working to roll out SDGs promotion initiatives to the entire Group through the
Corporate Planning Department’s SDGs Promotion O ce, as well as strengthening collaboration and raising awareness of SDGs within
the Group.

In FY , we established SDGs managers and the SDGs Advisory Group.
The SDGs managers, who are appointed for each organization of the Group (each division and Group company), take charge of thepromotion of SDGs business and the establishment and monitoring of the KPIs.
The SDGs Advisory Group is an organization composed of personnel engaged in SDG- and ESG-related work within the Daiwa Securities
Group. It conducts discussion and sharing based on the respective knowledge of those personnel.

13

SDGs report 2020

Introducing the SDGs Promotion Committee Members
ChairmanSeiji Nakata
President and CEO
Committee Members

Toshihiro Matsui
Deputy President and COO

Keiko Tashiro
Deputy President
Head of Overseas and SDGs

Koichi Matsushita
Deputy President
Head of Asset Management

Mikita Komatsu
Deputy President
Deputy Head of Wholesale

Masahisa Nakagawa
Deputy President
Head of Think Tank

Shinsuke Niizuma
Senior Executive Managing
Director
Head of Retail

Akihiko Ogino
Senior Executive Managing
Director
Head of Planning and Legal
and
Executive Head of Human
Resources

Junichi Arihara
Executive Managing Director,
CRO and CDO

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SDGs report 2020

Kana Shirakawa
Executive Managing Director
Head of Human Resources
and CHO

Eiji Sato
Executive Managing Director
and CFO
Deputy Head of Planning and
Deputy Head of Overseas

Kotaro Yoshida
Managing Director, Corporate
Planning Department

Touko Shirakawa
Project professor, Sagami
Women's University
Visiting professor, Showa
Women's University
Member of Council for
Promoting the SDGs in the
Security Industry, JSDA

Naohiro Nishiguchi
CEO, Japan Innovation
Network
Senior Innovation Advisor,
UNDP
President, Japan Bosai
Platform

Outside Members

Hiroko Kuniya
Project professor, Keio
University's Graduate Schoolof Media and Governance
Trustee (special mission) , theTokyo University of the Arts
National Goodwill
Ambassador for Japan by The
Food and Agriculture
Organization of the United
Nations (FAO)

15

SDGs report 2020

Passion for SDGs -Daiwa Securities Group Action PlanInitiatives in FY
In order to promote the SDGs in the entire Group, we believe that not only top-down promotion but also bottom-up e orts byemployees are important, and we solicited a wide range of SDGs-related initiatives and ideas from employees. When soliciting ideas,
we incorporated two perspectives: Forecasting that considers what we can do now, and Backcasting that considers what we can dobased on the "ideal image" of the Group in 2030, the deadline for achieving the SDGs. As a result, for Forecasting we gathered morethan 4,200 ideas not only from the headquarters departments, but also from branch o ces in Japan, Group companies, and overseas
bases. In the Backcasting approach, about 120 volunteers gathered through internal recruitment and made a proposal for therealization of the Group's 2030 vision.
From this bottom-up initiative, we identi ed the matters that should be focused on to solve social issues, and compiled the "Passion
for SDGs -Daiwa Securities Group Action Plan-."16

SDGs report 2020

Recently, new businesses and activities that contribute to the SDGs have been actively conducted. On the other hand, there is a
shortage of funds necessary for achieving the SDGs.
With this situation in mind, we will actively work to create shared value by capitalizing on the strengths of a comprehensive securities
group and building “a Daiwa version of an SDG value chain” that will create a sustainable capital cycle.
More speci cally, we aim to
Expand the market through education and proliferation of SDGs
Expand nancial products that meet the need for investing in SDGs
Work on support to industries and companies that contribute to SDGs, through investment and consulting
Appropriately evaluate the impact of such investment on society and provide feedback to investors, thereby helping to create moreinvestment opportunities
We will work proactively to encourage a favorable cycle of value generated from each of these processes.

Initiatives in FY
To accelerate the initiatives for our SDGs promotion Action Plan, we have set SDGs promotion KPIs for each action theme for this scal
year, and have started trial operation. Based on those KPIs, we will monitor the status of progress and make revisions if necessary,
aiming for full-scale operation in the next scal year and beyond.

*1. Scope:Daiwa Securities Co. Ltd.
*2. Scope:Daiwa Asset Management Co. Ltd.

17

SDGs report 2020

Daiwa Securities Group SDGs Declaration
Daiwa Securities Group recognizes Sustainable Development Goals adopted by the United Nations in 2015 as overarching goals to leadthe world. Through our group business, we will work actively for realization of a prosperous society and improved people's life by
pursuing both company's economic values and solution of social challenges at the same time.

Creation of Shared values
As an integrated securities group that provides wide range of services for various customer needs, we will address solutions of social
challenges with exible mindset to create company's economic values and social values at the same time.

Developing and realizing work styles for diverse human resources
With measures like promotion of better work-life balance and success of female and veteran employees to create working environment
in which our employees, regardless of their gender and age, would feel satisfying to work and they would demonstrate their potential
fully, we will endeavor to develop diverse human capital and work styles.

Stakeholders and Partnership
By utilizing our group quality of taking a leading role in connecting countries, companies and investors, we aim for contribution tovarious social business solutions through partnership with each of our stakeholders.

Increase recognition and enhance penetration
We will try to increase awareness and deeper understanding of SDGs among both our employees and customers through our groupbusiness as a main player in nancial and capital market.

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SDGs report 2020

Role and Social Responsibilities of the Securities Business
At Daiwa Securities Group, we believe that our role is not only to maintain and develop a fair and dynamic nancial market, but also toincorporate a social perspective in nance in order to contribute to building a sustainable society. For example, the securities business- our core operations - plays a key role in society by building a bridge between the needs of investors to manage assets and those of theprivate and public sectors to raise funds.
On investing in securities, we promote methods of investment that take ESG (environment, society, and governance) factors, such asenvironmental and social initiatives into account together with nancial information.

Supporting Sound Financial and Capital Markets-Six Roles of the Daiwa
Securities GroupWe support companies that need funds, from listing support to consulting.
We will continue to support social infrastructure by creating a ow of funds, contributing to the creation of a soil where innovation iseasy to occur, and the creation of a more active and stable nancial market.

Role 1 Fund procurement by companies, etc.
Companies issue capital by issuing securities (stocks and bonds) and use them to develop new products and provide newservices. Financing using these securities will contribute to the growth of the company and the resulting economic
growth.
Daiwa Securities Group advises companies and others on nancing using securities.

19

SDGs report 2020

Role 2 Support for initial public o erings
The emergence and growth of new companies is essential for economic growth. The initial listing will not only contributeto the growth of the company but also provide investment opportunities for various investors. The Group is assisting in
the initial listing.
Role 3 Assistance in trading of securities
Securities such as stocks and bonds are mainly traded on markets such as stock exchanges.
Securities companies help you buy and sell securities. It is also important to ensure that the securities traded aredelivered correctly.
Role 4 Assistance in asset building
The Group o ers a wide range of products and services, and o ers proposals tailored to customers to help with life
planning and asset formation.
Role 5 Analysis and provision of information
Many economists, analysts and strategists provide a wide variety of information that combines the latest trends and indepth analysis in an easy-to-understand format.
Role 6 Protect market trust
The market for securities is an important infrastructure of society and is built on the trust of participants. The Group
strictly manages information and monitors transactions to ensure that the market is fair and fair. We are also actively
working on dealing with ever-evolving trading methods and new issues.

20

SDGs report 2020

Responsible Action as an Institutional Investor
Adoption of "Japan's Stewardship Code"The Financial Services Agency of Japan published “Principles for Responsible Institutional Investors (Japan’s Stewardship Code)” in
February 2014. The Code, which has been revised twice, encourages institutional investors to ful ll their responsibilities of enhancing
the medium- to long-term investment return for their clients and bene ciaries by improving and fostering the investee companies’
corporate value and sustainable growth through constructive engagement, or purposeful dialogue, based on consideration of
medium- to long-term sustainability including ESG factors consistent with their investment management strategies.
In our Group, Daiwa Securities and Daiwa Asset Management have announced their adoption of the Code.

Adoption of Principles for Responsible Institutional Investors (Japan’s Stewardship Code)
Daiwa Securities
Daiwa Asset Management

System at Daiwa Asset Management

Daiwa Asset Management announced its adoption of Japan's Stewardship Code in May 2014 and has been actively working to ful ll its
stewardship responsibilities. It has been striving to improve its initiatives, renewing the announcement of its adoption in November
2017 following the revision of the Code in May 2017.
In January 2017, Daiwa Asset Management set up the “Stewardship Supervisory Committee” which is designed to manage con icts ofinterest faced in ful lling its stewardship responsibilities. The Committee supervises the company's overall stewardship activities andis responsible for making reports to the Board of Directors and issuing recommendations to improve stewardship activities asnecessary. The Committee is composed of outside directors and the compliance o cer, who takes charge of overseeing themanagement of con icts of interest. In that way, independence in the stewardship activities from management and business execution
is secured.
Daiwa Asset Management also established the Stewardship & ESG Section within the Investment Planning Department in October 2018
to help show the company’s speci c ESG initiatives and approach to parties within and outside the company.
Moreover, Daiwa Asset Management published its “ESG Investment Policy” in January 2020 to clarify its approach to ESG. As of March
31, 2020, the amount of investment in consideration of ESG accounts for as much as 90.14% of the company’s assets undermanagement.
Regarding dialogues with investee companies, based on the Policy to Hold Constructive Dialogues with Investee Companies
announced in June 2014, Daiwa Asset Management has conducted engagement activities aimed at accurately understanding theconditions of investees and sharing such assessments. As issues to be discussed with investee companies are changing, it reviewed the
Policy in November 2018, re ecting the ndings gained through dialogue and the revision of Japan's Stewardship Code and Corporate
Governance Code.
Daiwa Asset Management recognizes that it also has duties regarding engagement for passive investment. Based on this recognition, it
has been sending its “Policy on Exercising of Voting Rights” and information on its stewardship activities since 2018 to all of theapproximately 2,200 investee companies incorporated in its domestic stock index funds. The company hopes this will help increase
understanding of its stewardship activities and serve as the rst step toward dialogue.
About Stewardship Activities
ESG Investment Policy
Voting Policy
Voting with consideration of the impact of COVID21

SDGs report 2020

Speci cally, dialogues are led by the following three parties.

Analysts in the Research Department: Constructive Dialogues
The analysts in the Research Department engage in stewardship activities to contribute to enhancing corporate value andsustainable growth as part of their usual research activities. They held engagements with approximately 300 companies
in FY (from January 2019 to December 2019; hereinafter the same). As fundamental tools for dialogues, Daiwa AssetManagement has prepared and utilizes (a) the Analyst Handbook, which summarizes the fundamental stance andknowledge that serves as a basis for the analyst activities; (b) the Business Strategy Reference Book that analyzes
companies’ management strategies; (c) the Qualitative Evaluation that evaluates companies from a medium- to longterm standpoint; and (d) the Long-term Corporate Value Model that determines the medium- to long-term fair value ofcompanies.

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SDGs report 2020

The Stewardship & ESG Section of the Investment Planning Department: Governance Meetings
Personnel in charge of corporate governance collect information on investee companies required for exercising voting
rights. In dialogues with investee companies, they explain their policies on exercising voting rights and what they expectfrom companies with respect to corporate governance, thereby sharing their knowledge with the investee companies.
They conducted engagements with approximately 130 companies in FY . They also disclose how they exercised theirvoting rights for individual proposals from shareholder meetings held from April 2017 onwards.
Engagement Team Comprising Analysts in the Research Department and Fund Managers: Engagement Meetings
The engagement team held engagement with approximately 30 companies in FY , focusing on small- to medium-cap
issues mainly incorporated in active investment funds for medium- to long-term investment. It continued to engage inconstructive dialogue, delivering the “Long-term Vision and Medium-term Management Plan,” which summarizes points
on information disclosure from a long-term perspective, and “Introduction of Daiwa Asset Management’s Engagement
Policy,” which mainly describes what Daiwa Asset Management expects from investee companies and the issues that it
wants to discuss through constructive dialogue. The team also held dialogue speci cally on the environment and social
aspects.
Daiwa Asset Management also conducts ES meetings—dialogues specializing in environmental impact and social
responsibility. It strengthened ES meetings in FY as it believes that the importance of the environment (E) andsociety (S) will increase further if medium- to long-term corporate value is taken into consideration.
Daiwa Asset Management has released a Report on the Status of Stewardship Activities on its website (only available inJapanese). The report includes the status of engagements, such as policy, structure, and the number of engagement
times by theme, as well as ESG investment, the status of exercising of voting rights, and measures to improve stewardship
activities.

Participation in Initiatives

Daiwa Securities Group has participated in, signed, and supports a variety of initiatives to contribute to developing a sustainable
society through partnerships with various parties, including those in the nancial and business world.
Participation in Initiatives

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SDGs report 2020

Action through Product Development and Distribution
For Addressing Social Issues and Contributing to Future Developmentof Society and Financial and Capital Markets

Impact Investment

Impact Investment is a type of investment that not only pursues economic bene ts, but also uses funds raised solely to solve social
issues, such as poverty and environmental problems. Daiwa Securities Group sells SDG bonds,* which are issued by publicorganizations, nancial institutions, and other issuers for the purpose of solving social issues, to customers in Japan as a pioneer for
Impact Investment bonds in the country.
* A generic term for bonds the proceeds of which are used for projects that contribute to SDGs (including conventional Impact Investment bonds)[Japanese] Social Contribution through Investment-Impact InvestmentInitiatives in FY
Climate change has become a serious threat to all countries. It is said that developing countries are being impacted rst
and with the gravest results. Climate change may destroy the social initiatives for poverty issues that have been steadily
carried out over the last several decades, and it is impossible to separate it from poverty issues.
In the past few years, initiatives for SDGs have spread worldwide, and along with the expansion of the market for relatedbonds, customers’ interest in SDGs has been growing. As a pioneer for Impact Investment bonds in Japan, Daiwa
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SDGs report 2020

Securities provides customers with opportunities to invest in bonds issued by public organizations, nancial institutions,and other issuers for the purpose of solving social issues.
In September 2018, we sold MOL Blue Ocean Environmental Bonds, the rst green bonds issued by an operating company
in Japan (sold by two securities companies—Daiwa Securities and Nomura Securities). These were green bonds issued inJapan following the Tokyo Green Bonds (foreign currency-denominated) issued by the Tokyo Metropolitan Government
in FY . Through the underwriting and sale of these bonds, Daiwa Securities aims to help expand trends towards
utilizing precious funds from retail investors for environmental measures, and to this end, we continued with our
initiatives in FY .
Daiwa Securities Group will continue to contribute to solving social issues through its business activities, including theunderwriting and sale of Green Bonds and other SDG bonds (Impact Investment bonds).

Green Bonds for Retail Investors Sold by Daiwa Securities (FY)

Use of funds

Salesamount(estimate)

GLP J-REIT*

Used for repaying loans taken out to acquire GLP Maishima II,
which is an eligible green asset¥3 billion

Mitsui O.S.K. Lines*

Used for businesses that have the e ects of improving theenvironment and contribute to solving social issues¥6 billion

AEON REIT Investment
Corporation*

Used for re nancing existing loans taken out to acquire
AEON MALL Kofu Showa and AEON MALL Kagoshima, which
are special assets meeting the criteria for eligible green
assets¥4 billion

Tokyo Metropolitan
Government (TMG)

Used mainly for rebuilding and repairing facilities owned by
TMG, replacing lights for facilities and roads owned by TMG
with LED lighting, and maintaining parks, as well as coastal
protection facility development projects for the Port of Tokyoand the Tokyo Islands¥2.1 billion

Crédit Agricole Corporate andInvestment Bank

Lending to companies and projects that contribute todevelopment of an environmentally friendly economy andsociety¥23.1 billion

Issuers* Sold by multiple companies including Daiwa Securities (the sales amounts shown above are those underwritten by Daiwa Securities).

Results of SDGs bonds (Impact Investment bonds) for retail investors
Daiwa Securities cumulative sales:¥ . billion* Figures have been rounded o* Source: Daiwa Securities (From March 2008 to March 2020)

Daiwa Securities' share in the Japanese market: %Total ¥1,506.1 billion* Figures have been rounded o* Source: Daiwa Securities (From March 2008 to March 2020)

SDGs related to Impact Investment bonds sold in the past25

SDGs report 2020

Initiatives Taken by the Group's Overseas O ces

In July 2019, Daiwa Capital Markets Europe (“DCME”) arranged for the issuance of privately-placed bonds for CDC Habitat,a subsidiary of Caisse des Dépôts et Consignations (“CDC”), a public institution in France. CDC Habitat owns and manages
approximately 495,000 houses for public institutions and government employees in France. It contributes to France’s
public policies by providing emergency shelters for people in a socially di cult situation and supporting the country’ssocial housing policy. DCME has developed a relationship with CDC over a period of many years. The initiative taken thistime contributes to achieving SDG Goal 11 “Sustainable cities and communities,” which is aimed at making cities
inclusive, safe, resilient, and sustainable.
In November 2019, DCME also arranged 1 billion euro benchmark sustainability bonds issued by the German state ofNorth Rhine-Westphalia as a co-lead manager. The proceeds will be used as funds for sustainability-related research,
countermeasures against climate change, public health, education, and other projects in the state.
Initiatives in FY

Initiatives Taken by the Group's Overseas O ces

In June 2020, Daiwa Capital Markets America acted as a sole lead manager for a sustainable development bond issued byInter-American Development Bank (IDB).
IDB is an international development nancial institution aiming to contribute to the economic and social development of
Latin American and Caribbean member countries. It has announced that it would direct up to $12 billion of lending tosupport countries in their response to the COVID- pandemic and its consequences.
The funds raised through this issuance will be used mainly for helping countries a ected by COVID- to strengthen their
public health systems and purchase daily necessities and medical equipment. They will also be used for scal spendingby local governments to respond to the COVID- pandemic and various measures for supporting economic recovery,such as job security measures.
The issuance of the bond is aimed at achieving SDG Goal 3 “Ensure healthy lives and promote well-being for all at all
ages.”SRI Investment Trusts

SRI investment trusts are a mixture of stocks and bonds that take into account factors other than nancial performance, such as ethics
and social and environmental objectives, in addition to assessments of the sales and pro ts of the investment candidates. We o er eco
funds that limit non- nancial assessments to environmental performance, and investment trusts that focus on Impact Investment andselect issues from an SDG perspective. By investing in these trusts, through the nancial markets, investors can indirectly support
countries and corporations that are proactively involved in ESG and SDG initiatives.
Result in FY
Balance in Daiwa Securities Group:¥ . billion* Source: Daiwa Securities

Daiwa Securities' share in the Japanese market: %* Source: Daiwa Fund Consulting (As of March 31, 2020)26

SDGs report 2020

Daiwa Social Contribution Wrap - Daiwa Fund Wrap with a donation service
Amount donated in FY : ¥10.52 million* Total donated amount from customers and from Daiwa Securities* Donated to United Nations World Food Programme, Medecins Sans Frontieres Japan, WWF Japan, Japan Committee for UNICEF, Japan
Platform

Development and Provision of Superior Financial and Investment
Products
While the importance of asset management in the " -year life era" is increasingly gaining attention, Daiwa Securities considers thedevelopment and provision of superior products to be one of our major missions in society, and strives to develop new products andimprove their quality.
Daiwa Next Bank’s “Support Term Deposits”
Support Term Deposits are designed to support hard-working people and organizations. Daiwa Next Bank donates anamount calculated by multiplying the balance of its Support Term Deposits by a certain rate to recipients chosen bycustomers. At present, it supports more than 10 organizations working on solving issues based on the following four
themes: medical support to children; self-reliance support to children; support for sports for disabled people; andenvironmental preservation.
Feedback received from customers includes: “This was a good opportunity to learn about social issues” and “I hopesimilar initiatives will become more widespread.”
In December 2019, these Support Term Deposits received the special award “SDGs Partnership Award” in the third “Japan
SDGs Award” in recognition of their remarkable contribution to achievement of SDGs.
News from Daiwa Next Bank
Initiatives for Solutions Business
Many small- and medium-sized companies and small-scale enterprises are now facing the issue of business succession
due to the aging of their operators. However, it is said that about half the managers exceeding the age of —the averageretirement age—in the next 10 years are yet to decide on their successors. Moreover, even the continuity of their businessactivities, which support regional economies, has recently been adversely a ected by the unprecedented deterioration ofmanagement environment resulting from the COVID- pandemic. Daiwa Securities recognizes that it is its duty, as anancial institution, to rmly support, in nancial terms, small- and medium-sized companies’ e orts to pass down theirvaluable business resources, employment, and technologies to the next generations, thereby helping to maintainregional supply chains. It will support the growth of the Japanese economy by encouraging the continuation,
development, and growth of small- and medium-sized companies of good standing through providing inheritance,business succession, M&A and other solutions.
Initiatives of Fund Wrap Services
Daiwa Fund Wrap is a service enabling even those who are busy or have no investment experience to easily start mediumto long-term diversi ed investment. Under a discretionary investment contract, Daiwa Securities invests and manages
assets on behalf of our customers. We o er plans that enable each customer to make diversi ed global investments
27

SDGs report 2020

according to their investment policy, as do professional institutional investors such as those managing public pension
assets. It has become more important than ever for a large number of investors to manage their assets e ciently andstably through diversi ed global investment, in particular as a measure to address prolonged low interest rates, whichhave made it di cult to nd attractive investment options. Daiwa Fund Wrap is a service o ered to customers over the
medium to long term. We provide thorough explanations before the conclusion of a contract, report investment
performance regularly every three months, and hold follow-up seminars whenever necessary. We thus ensure close
communication with customers and seek to build a relationship of trust with them.
In addition, Daiwa Fund Wrap Premium, launched in October 2016, now o ers a more detailed service, enablingcustomers to have multiple investment portfolios and design them in a highly customized manner. In particular, theinheritance recipient designation service and the gift service taking advantage of the calendar year taxation system,
which became available in July 2018, are services that can satisfy customers with a strong interest in inheritance tax
measures.
Moreover, Daiwa Fund Wrap Online, launched in January 2017, proposes the most suitable investment style from aminimum investment amount of ¥10,000 by utilizing Robo-Advisor technology. We thus provide a service enablingcustomers who prefer long-term asset management to easily engage in globally diversi ed investments online.
To keep attracting customers over the long term, we will continue our initiatives to implement better structures andsystems so as to improve our performance and the quality of our services.
Balance of domestic Wrap accounts: ¥8,777.4 billion (As of March 31, 2020)* Source: Data released by the Japan Investment Advisers Association

Balance of Wrap accounts at Daiwa Securities: ¥2,087.4 billion (As of March 31, 2020)* Source: Data released by the Japan Investment Advisers Association

Initiatives by Daiwa Asset Management
For Daiwa Asset Management, one of the pillars of building a stable, superior asset management capability is to takeappropriate risks in managing active funds. We have therefore built a support system by collecting information from theresearch division and other relevant specialist teams. This system enables fund managers to take risks after thoroughexamination. In particular, we are striving to improve our ability to select companies with good prospects to make this amajor source for strong investment performance.
We focus especially on ESG information from a long-term perspective. Daiwa Asset Management has placed personnel incharge of ESG within the Fund Management Division to promote ESG investment in an organized manner as a signatory
to both the United Nations' Principles for Responsible Investment (PRI) and the Principles for Financial Action for the stCentury. Since adopting the Japanese version of the Stewardship Code, we have been working to deepen our dialogue
with investee companies by means such as holding dialogue with the theme of integrated reports. In October 2018, weestablished the Stewardship & ESG Section within the Investment Planning Department to further incorporate an ESG
perspective and strengthen monitoring.
In addition, Daiwa Asset Management published its “ESG Investment Policy” in January 2020 to clarify its approach to
ESG. In principle, the Policy applies to all investment strategies of the company. In February 2020, Daiwa AssetManagement established the Cleantech Stock & Green Bond Fund (asset growth-type/ predictable distribution-type),
nicknamed “Mirai Earth,” which focuses on “E” (environment) in response to growing interest in ESG investment andSDGs among retail investors and companies handling its products.
It is especially important to always grasp current trends and customer needs for the development of products. We are
therefore striving to maintain close communication by holding seminars for customers and through operation of ourunique call center. We are also building a structure that assists companies marketing our products to support thetransition from savings to asset building.

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SDGs report 2020

Initiatives Using REITs and Other Structures to Solve Social Issues
Daiwa Real Estate Asset Management uses investment corporations and fund structures to provide funds through capital
markets to real estate, including o ces, rental housing, healthcare facilities, hotels, and logistics facilities, as well as
infrastructure assets such as renewable energy power plants. By doing so, the company will contribute to putting in placeand developing high-quality properties and creating an environmentally friendly social infrastructure.

Investment in Healthcare Facilities

Daiwa Real Estate Asset Management managed Nippon Healthcare Investment Corporation, which was Japan's rst REIT
focusing on healthcare facilities. On April 1, 2020, that REIT was merged with Japan Rental Housing Investments Inc., a
REIT focusing on housing that was also managed by Daiwa Real Estate Asset Management, and they were reborn as
Daiwa Securities Living Investment Corporation (“DLI”), the J-REIT with the largest amount of healthcare facility assets
under management in Japan. DLI invests in prime healthcare facilities that are likely to see stronger demand from society
over the medium to long term as the population continues to age. Through such investment, it will contribute to the“Achievement of Good Health and Longevity,” which is identi ed as a social issue in Japan in the SDGs Implementation
Guiding Principles formulated by the government’s SDGs Promotion Headquarters.
Total amount of investment in healthcare facilities
Approximately ¥86.9 billion (as of May 31, 2020)

Investment in Renewable Energy

With regard to infrastructure assets, Daiwa Real Estate Asset Management has been managing photovoltaic power
stations since FY , and was entrusted in FY with the management of a biomass power generation plant invested
in by Daiwa Energy & Infrastructure. It has been continuously expanding the balance of its assets under management
while striving to accumulate knowledge of investment and management in the renewable energy eld.
Management results of renewable energy power plants
Number of deals: 17(Hokkaido, Tohoku, Hokuriku, Kanto, Chubu, Chugoku, and Shikoku regions)
Output: Approximately 120 MW (excluding output from assets on land with leasehold interest)
Annual energy output (June 2019 to May 2020)： , MWh(calculated based on an assumed CO2 reduction of 72,872 t-CO2 and an emission factor of 0.000475 t-CO2/kWh)Balance of assets under management: Approximately ¥50.8 billion
Group-wide Research on Financial Innovations
Daiwa Securities Group launched the Financial Innovation Committee in FY as a platform for Group-wide research
activities, and frontline employees at Daiwa Securities Group Inc., Daiwa Securities, Daiwa Institute of Research, Daiwa
Asset Management, and other companies are proceeding with research activities on AI and other state-of-the-art
technologies.
Speci cally, they have achieved results in research on the provision of a stock information service using a stock priceprediction model, a real-time stock volume prediction model, shareholder rewards program Robo-Advisor, an AI-based
business matching service, an AI-based company analysis tool, and other matters.
Moreover, in FY , the Group launched the “Daiwa Securities Group & the University of Tokyo Future Finance Forum” inorder to develop its research activities further and expand the basis of the activities. As its advanced form, since FY
we have been conducting joint research with a University of Tokyo study group led by Professor Kiyoshi Izumi through asocial cooperation program entitled “Next Generation Investment Technology” and have developed a theme issue searchsystem based on associative retrieval. Going forward, Daiwa Securities Group will continue to promote innovations in thenancial industry through its ongoing research activities.
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SDGs report 2020

Response to FinTech and arti cial intelligence (AI)
Since starting Daiwa Online Trade, Japan's rst Internet-based securities brokerage service, in 1996, Daiwa Securities has
provided various products and services successively over a period of more than 20 years. Due to the widespread use of
portable information devices and the development of information communications technology, the importance ofInternet channels has increased even more in recent years, with the number of accounts held under contract for Daiwa
Online Trade topping 3.3 million as of the end of March 2019. Of Daiwa Securities' total stock transactions, approximately
80% are carried out via the online trading service, underscoring the fact that Daiwa Online Trade has become an
indispensable channel for Daiwa Securities.
Since May 2017, we have been providing information through Daiwa Online Trade regarding domestic issues selectedusing an AI-based stock price prediction model developed by Daiwa Institute of Research, Daiwa Securities Group’s thinktank. We select issues whose prices are likely to go up gradually after the announcement of nancial results, using amethod of machine learning, which is an AI-related technology. In 2019, we distributed information four times in total
when major nancial results were announced.
Furthermore, in February 2019, we introduced a login function using a biometric authentication system to Kabu Walk, asmartphone application with a domestic stocks trading function provided on iPhones and Android devices. We believethat by actively using such new technologies, including AI and FinTech—an amalgamation of nance and information
technology—we will stimulate interest in securities investment among individuals, especially younger generations, whohave not previously been familiar with securities investment, and thereby support a shift from savings to asset building.
In that way, we can contribute to Japan’s sound economic development.
As the use of various AI-based services is currently spreading and the development of FinTech is accelerating, newnancial services leveraging these technologies are becoming easily available. We will keep track of such trends andendeavor to continue enhancing convenience and providing quality services as a channel chosen by next-generationa uent customers and young customers with particular focus on inbound marketing.
Daiwa Online Trade
Number of contract accounts: 3,362,505 accounts(As of the end of March 2020)
Contribution to Stimulation of Local Economies though AI-based Support for Enhancement of Financial Services
Due to its technological progress and higher academic rating, arti cial intelligence (AI) has been increasingly used forbusiness applications. Daiwa Institute of Research Business Innovation, which is entrusted by many nancial institutions
with system development, is advancing initiatives for research and application of AI.
As part of AI-based support for enhancement of nancial services, the company developed a common data de nition
that enables AI to learn the nancial activities and state of mind of retail customers with remarkable accuracy by
combining a wealth of experience in developing nancial systems and unique data science expertise. It built a nancial
product recommendation AI system based on this data de nition, which has been provided since 2019 to some regional
nancial institutions. The system is expected to allow those nancial institutions to predict the nancial needs of theircustomers more accurately with AI.
Daiwa Securities Group will contribute to the social and economic development of communities through initiatives that
actively use state-of-the-art technologies.

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SDGs report 2020

Providing Analysis/Proposals on the Economy, Society, andInvestment Information
Daiwa Securities Group as an integrated securities group provides, in addition to investment information, a wide range of informationon the economy and society. We hope that the measures we propose from a long-term perspective will be helpful to customers,
investors and a variety of stakeholders.

Easy-to-Understand Communication of Information
Daiwa Securities publishes information for a wide range of people from institutional and retail investors to those who are about to startinvesting. The central role in the provision of information is played by highly specialized analysts and strategists from the Investment
Strategy, Equity Research, and Fixed Income, Currency and Commodities (FICC) Research Departments. They provide information
mainly through reports based on their unique analysis. Our information is based on close collection and analysis of data. Even if thesame person is providing that information, we tailor the presentation, depending on whether it is for retail investors or institutional
investors, who are investment professionals.
For example, if information is targeted at retail investors, we implement various measures to make it more visually understandable. To
remove the general perception that securities investment or securities companies are complicated, we believe it is one of our missions
to work toward communicating our analysis using easy-to-understand language.
Initiatives to Provide Information on ESG (Daiwa Securities)
Daiwa Securities' Equity Research Department is a group of analysts and strategists. They analyze and evaluate
information released by companies, and provide investment information and ideas to institutional investors.
International agendas, such as SDGs and the Paris Agreement, have gained much attention in recent years. Against thisbackdrop, a growing number of investors are using non nancial information in relation to the environment, society, andcorporate governance when making medium to long term investment decisions. Therefore, in May 2019, Daiwa Securities
established ESG Research Division, which specializes in handling ESG information, within the Equity Research
Department, thereby putting in place a system for comprehensively analyzing and evaluating nancial and non nancial
information. The ESG Research Section works on writing analysis reports focusing on topics such as climate change,
human rights and gender issues, corporate governance systems, and social impact, as well as holding ESG seminars andother activities.
ESG information will become more and more important for companies and society as a whole for achieving sustainablegrowth over the long term. We strive to provide appropriate ESG information in a timely manner so that institutional
investors will be able to expand their investment returns in the medium to long term through responsible investment andpurposeful dialogue (engagement).
Number of SDGs/ESG seminars held & participants
2019: 15 (576 participants)
2018: 15 (310 participants)
2017: 18 (545 participants)
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Initiatives by Daiwa Institute of ResearchComprehensive Provision of Information and Policy Proposal Activities
Daiwa Institute of Research (DIR), which assumes the think-tank role of Daiwa Securities Group, provides wide-ranging
analysis and information to the public. At DIR, we consider it our mission to engage in comprehensive provision of
information and policy proposal activities concerning the nancial and capital markets and the real economy. We havealways sought to provide up-to-date and in-depth information and a unique viewpoint that has not been presented byothers. In order to provide information that satis es the needs of the public, we also exchange information and holddiscussions with businesses, investors, public institutions including governments and municipalities, and various
economic groups, as well as overseas think-tanks and media. In this way, we are able to analyze the currents and trendsof society and disseminate information.
We are also stepping up the release of ESG information, communicating wide-ranging information via our website and"DIR Research Quarterly Review" (our quarterly journal) regarding community vitalization, environmental problems,
women's active participation in society, workstyle reform, corporate governance and other issues.
Provision of information by DIR through diverse media
Number of reports posted on the website : 531 reports (Results for FY )Full texts of reports available on the website
Number of recent hits on the research division's page : 3.93 million hits (Results for FY)

Strengthening the Provision of Information
The Research Division of DIR launched the Policy Research Department in FY . In addition to providing information on
the macro economy and nancial and capital markets within and outside Japan, the company is now focusing on making
policy proposals based on multifaceted analysis of issues such as measures for maintaining the sustainability of
government nances and the social security system, and the directions that society and businesses are required topursue from an ESG perspective. Moreover, it established the O ce of SDGs Research & Consulting and the O ce of AI
Analytic Research in FY , and has contributed to society through dissemination of information aimed at solving
various issues, while working on new economic forecasting and analysis methods using AI and other technologies. In
FY , the O ce of SDGs Research & Consulting published 81 reports and made 57 visits to nancial and non nancial
companies to provide information. It also launched SDGs Workshops for personnel responsible for SDGs in companies tosupport SDG initiatives in their companies, and actively engaged in other activities.

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SDGs report 2020

Economic Analysis Initiatives Using AI
DIR has been releasing the Daiwa Regional AI (Regional Love) Index, which calculates economic sentiment by region,
since July 2017 to contribute to the development of regional society.
Japan is faced with the important issue of breaking the vicious cycle of population decline and contraction of regional
economies to realize regional revitalization. To promote such regional revitalization, it is necessary to properly
understand the current state of regional economies, in addition to executing the policies that suit regional characteristics.
The Daiwa Regional AI (Regional Love) Index utilizes a state-of-the-art arti cial intelligence (AI) model and also
incorporates economists' knowledge to calculate overall economic sentiment by region. It has the following advantages:
1. demonstrating overall economic sentiment quantitatively and promptly by region;
2. grasping regional economic sentiment in a historical manner; and3. enabling analysis of which elds (such as "consumption" and "exports") provide impact and cause changes in overall
economic sentiment.
DIR also uses AI to analyze business conditions and regional economies. For example, it makes AI-based economic index
forecasts and has developed a model enabling regional economies to be quickly understood by using alternative data
(electricity volume demand data announced every day on the websites of power companies), which was rarely used for
economic analysis in the past.
In addition, DIR works on timely dissemination of information utilizing AI. It used Google Trends data and applied amethod of machine learning known as clustering to the supply shortage issue caused by the COVID- pandemic. By
doing so, it determined whether or not such shortages had occurred due to false rumors, while visualizing by item thedegree of people’s concern that they may not be able to purchase groceries and daily necessities. This method is
expected to become an e ective tool for policymakers and authorities to take appropriate responses.
Moreover, DIR strives to enhance the quality of disseminated information and policy proposals by actively utilizing
various sophisticated analysis methods. In its report “The true power of 'the Nadeshiko-like companies' for their
pro tability with causal inference” DIR used seven years of data for a total of several thousand listed companies, proving
through a statistical method known as cause and e ect reasoning that companies’ nancial performance will improve ifthey have more female executives and managers. This is a causal relationship that was previously di cult to prove. We
believe that, as a basis for promoting SDGs, there are extremely signi cant policy implications in the conclusion that
supporting women’s success is e ective also from the perspective of improving corporate earnings.

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Provision of Information through Diverse Media
Lectures and Media Appearances
The Research Division of DIR adopts a variety of methods for providing information. These include the writing of reports;
contribution to DIR Research Quarterly Review, newspapers and economic magazines; media interviews; TVappearances; lectures, seminars, and presentations at workshops; the publication of books, and participation ingovernment councils as members. We strive to explain in an easy to understand way complex issues related to theeconomy, society, and policy issues within and outside Japan, while emphasizing the quality of reports. We ensure thereliability of our reports by requiring them to undergo review by a specialized section. As a result, the information we
provide has improved in both quality and quantity, and we are communicating with customers on a continuously
increasing number of occasions.
Issuing of Books and Booklets
The Investment Strategy Department of Daiwa Securities issues the periodical "Daiwa Investment Monthly" and otherpublications as tools for communicating information to general customers. They are distributed to sales branches of
Daiwa Securities and are also available on the Internet. "Daiwa Investment Monthly" videos can also be viewed with asmartphone. We are further evolving our booklets to make them easier to understand.
We also provide information in various ways to general customers, including books available through publishers, deskcalendars with information on nancial events, and wall-hanging market charts.
Internet-based Initiatives

Live Web Seminars
Daiwa Securities Group regularly holds live web seminars where popular strategists and analysts of the Group appear as
lecturers. Customers can view them over the Internet in real-time and are also allowed to ask lecturers questions directly
either in advance or in real-time by typing into the bulletin board function.
These strategists and analysts sometimes serve as lecturers at seminars held at Daiwa Securities branches as well,enabling many customers to receive market information and commentaries on individual stocks in live seminars.
We will continue our e orts to communicate market conditions and outlook and other information to even more people
in a way that is easy to understand through our live web seminars.
Live web seminars (Results for FY)

Total of 13 seminars held
Annual number of participants: 61,974 participants

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SDGs report 2020

Daiwa Internet TV
In 2000, Daiwa Securities Group began “Daiwa Securities Information TV,” Japan’s only
channel dedicated to securities information, on the multichannel pay TV broadcast
service “SKY Perfect TV!” Since April 2011, we have been producing “Daiwa Internet TV” atour own studio and distributing it online in an e ort to target a wider range of viewers. We
distribute information on the Tokyo market ve times a day in a timely manner, whileproviding local market information from Hong Kong and New York every day.
In addition to these daily programs, we distribute corporate information as well as video
reports where analysts and economists at Daiwa Securities and DIR provide
commentaries on current issues in an easy-to-understand way.
Our Daiwa Internet TV initiative was introduced by the SDG Industry Matrix for Financial
Services (issued jointly by the United Nations Global Compact and KPMG International in2015) as a case for Goal 4 “Quality Education.” The report highlighted Daiwa's timely andfree of charge provision of a variety of nancial and investment information.
We will continue to make e orts to produce programs that can be viewed by not only
investors but also those who are new to investment, and that can support the journeyfrom savings to asset building.
Daiwa Internet TV
Daiwa Asset Management
In June 2019, Daiwa Asset Management released “iFree Touch,” an investment experience app that can be used like agame, hoping that the app would provide the asset building generation with an opportunity to take their rst step toward
investment. The company also posts “Tweets by Tsumitate Wa-NISA” on its website as educational content for NISA in ane ort to distribute information in an approachable, easy-to-understand way. It is a collaboration between the iFree Touch
character and “Tsumitate Wa-NISA,” the Financial Services Agency’s o cial character of the installment-type NISA. Daiwa
Asset Management recognizes that providing information to investors through the Internet will become more importantwith the spread of COVID- , and distributes, as website content, market information videos that focus on the U.S. and
REIT markets, in addition to the Fund Letters and Market Letters that have previously been distributed.
Daiwa Asset Management website
iFree Touch o cial website
Tweets by Tsumitate Wa-NISA

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SDGs report 2020

Providing Quality Service to Customers
Daiwa Securities Group understands that customer trust is the foundation of our business. Based on the idea of the Customer First
Principle, we always try to provide services that deliver genuine customer satisfaction.
We have also adopted the idea of hospitality to enhance our existing concept of customer service. We aim to provide customer service
that gives the most satisfaction to customers.

Building Deeper, Stronger Trust with Customers
Daiwa Securities aims to build customer satisfaction through quality services, built on understanding customer needs quickly andproposing the best solutions for each customer. We consider providing faithful and appropriate explanations to be paramount. A
principle of Japan's Financial Instruments and Exchange Act prohibits "solicitation that is improper in light of a customer's knowledge,
experience, nancial situation and objectives." Daiwa Securities' approach is rooted in this principle. As a part of our hospitality-based
service, when promoting our nancial products we strive to provide explanations and post-sale follow-up that exceed the legal
requirements. We have also agreed with the purport of the "Principles for Customer-Oriented Business Conduct" announced by the
Financial Services Agency in March 2017 and expressed our adoption of the principles, while drawing up and announcing our "Basic
Policy on Customer- rst Operations."
Moreover, to further improve our services and the quality of our response, we are continuing to conduct customer service surveys. We
survey customers regarding their degree of satisfaction with our services and response, and solicit their feedback and requests. Basedon the survey results, since FY we have been strengthening our initiatives to improve the quality of post-sale follow-up andenhance the convenience of e-mail services.

Basic Policy on Customer- rst Operations
Daiwa Securities Group has agreed with the purport of the "Principles for Customer-Oriented Business Conduct"announced by the Financial Services Agency on March 30, 2017 and expressed its adoption of the principles. The Group has
also drawn up and announced its "Basic Policy on Customer- rst Operations."
Daiwa Securities Group Inc.
Daiwa Securities Co. Ltd. (Japanese)
Daiwa Asset Management Co. Ltd. (Japanese)
Daiwa Next Bank, Ltd (Japanese)36

SDGs report 2020

Thorough Post-Sale Follow-Up and Appropriate Provision of Information
A customer's purchase of a product is only the beginning of a securities company's relationship with the customer.
Follow-up is the key to maintaining and solidifying the relationship of trust built with the customer.
To alleviate customer dissatisfaction or concerns arising after transactions, we o er thorough explanations, appropriate
proposals, and information regarding market conditions, products, and services. We have also expanded the use of
emails and online meetings, as well as face-to-face meetings, telephone and other conventional methods, thereby
developing a system enabling us to provide appropriate follow-up to as many customers as possible.
Introduction of NPS®* (Net Promoter Score) Towards Realization of Quality No. 1
In FY , Daiwa Securities introduced NPS® (Net Promoter Score) as an in-house indicator for measuring customer
satisfaction.
The score measures the degree of customer recommendation and is considered to correlate closely with businessperformance. We position it as one of our most important management indicators.
When introducing NPS®, we implemented sales reforms successively at individual branches to ensure that the aim of theintroduction is well understood and established among employees, rather than them merely adopting the score. Thus, it
took a year to complete the introduction of the score at all branches.
We will further step up our e orts to carry out sales activities from the customer perspective. At the same time, we willbuild a scheme for implementing a PDCA cycle that incorporates customer feedback and makes improvements, andcontinuously work to improve NPS®.
* NPS® is a registered trademark of Bain & Company, Fred Reichheld and Satmetrix Systems.

Improving In-Branch Customer Service Quality
Daiwa Securities strives to provide in-branch services that can satisfy any customer.
With the aim of creating sales branches enabling elderly customers and customers with disabilities to feel secure, wehave placed dementia supporters* and employees with service assistant* certi cations, mostly comprising employees
engaged in in-house customer service.
Moreover, in order to ensure that our sales branches are accessible to more customers, we implement a range of barrierfree measures, including reduced variations in oor level, the installation of automatic doors and larger counters, and theplacement of cane holders at all counters.
We have also been stepping up our e orts to enhance safety and convenience for elderly customers and customers withdisabilities visiting our sales branches. As part of such e orts, we place and make ready for use writing communication
boards, communication sheets, cane holders, hearing assistance devices, and other equipment.
*1. Dementia supporter
A dementia supporter is a person who properly understands dementia and pays warm attention to people with dementia and theirfamilies. The Ministry of Health, Labour and Welfare has been stepping up the training of supporters across the country as part of its"Dementia Supporter Caravan" project.
*2. Service assistantA service assistant is a person certi ed as having acquired hospitality and safe assistant skills for providing tailored support for
elderly customers and customers with disabilities.

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SDGs report 2020

Initiatives for Elderly Customers and Inheritance
Daiwa Securities has placed Anshin (peace of mind) Planners—a new type of sales agent—and Inheritance Consultants as
an initiative to provide each one of our elderly customers with optimum consulting and solutions.
Anshin Planners are mainly responsible for elderly customers, providing comprehensive consulting for customers in theirlater years. The scope of the Planners’ work is not limited to asset management but includes the provision of information
on health, long-term care, etc. and solutions in relation to gifts, inheritance, etc. to next generations.
Inheritance Consultants are professional sta members appointed from among employees with CFP® certi cations who
have highly specialized knowledge of inheritance and gifts.
We work to provide optimum support to every customer we serve by subdividing our services according to the life stageof each customer and making careful proposals.
* CFP® is a nancial planner credential certi ed by the Japan Association for Financial Planners. A CFP® holder has specialized knowledgeof asset management, taxation, etc.

Holding of a Variety of Seminars
Daiwa Securities holds a variety of seminars to provide information to customers. Sales branches handle a broad range of
topics in their seminars, such as information on Japanese and overseas markets; programs targeting the asset building
generation, including the installment-type Nippon Individual Savings Account (NISA) and iDeco, a de ned contribution
pension plan for individuals; and inheritance and gifts that alleviate concerns about old age.
We also regularly hold live online seminars which customers can participate in wherever they are. In January 2020, we
held the “Daiwa New Year’s Special Live Seminars” ve times in total, focusing on real estate and inheritance as topics, aswell as the global economy and market information.
Going forward, we will work to successively expand our online seminars.
Asset Building through Installment-Type NISA Including Workplace NISA
Daiwa Securities has been accepting applications for NISA accounts since the initiation of the program. In particular, we
actively introduce the program to customers, especially those in the asset building stage, in order to encourage morecustomers to start making investment in installments. We are also stepping up our initiative to propose the introductionof the workplace installment-type NISA. The program enables individuals to build assets systematically by setting aside a
xed amount each month for investment through their workplaces.
Information Website for Child Rearing and Money “SODATTE”
Daiwa Securities opened “SODATTE,” an information website for child rearing and money, in April 2016 for the childrearing generations. With four years having passed since its opening, it has grown to be a website visited by many fans,with more than 250 columns and more than 600,000 page view per month. The website sets up six categories, including“Money Lessons,” “Family Finances” and “Education Funds,” and disseminates columns that provide tips to child-rearing
generations.
As part of our initiative for nancial education, we released “A-I-U-E-Okane-no-ehon” on the website in December 2019. It
is a digital picture book that helps small children to deepen their interest in and understanding of money while learning
hiragana.
We will continue to update columns monthly as an information site that provides practical support on child rearing forparents and enables them to learn in an enjoyable way.
SODATTE38

SDGs report 2020

Contact Center Functions
The Contact Center has been a key channel for transactions, supporting the company's business model whose
cornerstones are Daiwa Consulting and Daiwa Direct transaction courses. The center now handles calls coming in to sales
branches, thereby acting as Daiwa Securities' comprehensive remote contact center for customers.
To strengthen the functions of the center, we rst expanded the scale of the service points in Tokyo and Osaka in FY
and then established a contact center function in Fukuoka in FY as our third service point. We also enlarged the oor
area of our service point in Osaka in FY .
By further expanding the ability to take calls, we aim to enhance our support functions for sales branches going forward
to increase customer convenience.
Scale of Contact Center: 820 service points(500 in Tokyo, 210 in Osaka, and 110 in Fukuoka)
Winning of Highest Evaluation from External Assessment Body in Inquiry Desk Category
Daiwa Securities received a three-star rating, the highest evaluation, in the inquiry desk category of the securities
industry in the 2019 HDI Rating Benchmark organized by HDI-Japan. We will continue to further enhance the quality of
our services and responses to satisfy customers.
Initiative to Get Closer to Customers
Since FY , we have been showing pictures of our operators on the website page for telephone inquiries to givecustomers a sense of security and familiarity with our remote Contact Center.

Working to Incorporate Customer Voices
At Daiwa Securities, the Contact Center and the Customer Support Center assume the function of utilizing customer feedback.
Contact Center Initiatives
Employees at the Contact Center, which serves as our comprehensive remote contact point, have direct contact withcustomers and play an increasingly crucial role not only as a transaction channel but also in customer support andmarketing. In order to maintain and improve contact center operations to meet the demand for high-quality service, we
provide training and regular level checks for all Telephone Service Representatives (TSR). We thus strive to appropriately
respond to customers' true needs.

Customer Feedback Sent to Contact Center

The Contact Center receives numerous comments and requests on online trading and Daiwa Securities' other products
and services.
We share such customer feedback information and requests with management and relevant departments and sections of
the head o ce and utilize them to enhance our services and customer interaction. (The number of major improvements
implemented in FY was 85.)
We also show some of the inquiries received from customers on our website as "frequently asked questions," while
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SDGs report 2020

sharing them with sales branches in some cases to speed up our responses. We are thus working to raise customer
satisfaction from various perspectives.
Number of cases in FY where responses were taken to customer feedback and requests
96 cases (in 48 of which responses were completed)

Customer Support Center Initiatives
Daiwa Securities' Customer Support Center is a department at the head o ce that handles customer feedback andcomplaints directly by phone. It is set up within the Compliance Department of Daiwa Securities.
The Center promptly gives feedback and complaints from customers to relevant sales branches and departments andsections of the head o ce. It also sorts and analyzes such feedback and complaints, shares them with o cers, sales
branches, and head o ce departments and sections, and capitalizes on them as precious information in the aim of"customer- rst operations" and "pursuit of best quality."
To respond to customers' calls thoroughly, accurately, and promptly, Customer Support Center members study the
securities tax code and Daiwa Securities' services together on a daily basis, and work to improve the quality of theircustomer services.
Calls received at the Customer Support Center in FY
Number of calls received: 3,846 calls (down 590 calls)
Inquiries: 81%
Complaints: 19%

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SDGs report 2020

Support for Creating Our Future Society
Daiwa Securities Group begins the social problem solving businesses in various elds, such as FinTech, healthcare, energy
infrastructure, and agriculture, utilizing the knowledge of various securities and nancial businesses cultivated by the Group.

Business development starting from the SDGs
SDGs × "Technology"

Creation of Next Generation Financial Services

Fintertech Co. Ltd., which was established in April 2018, works to create next generation nancial services mainly for the digital native
generation, using blockchain and other state-of-the-art technologies.
Since March 2020, it has been providing digital asset-backed loans. Going forward, the company will develop new nancial services,such as the provision of crowd-tipping systems and crowd-funding business, to satisfy diverse the needs of customers.
Fintertech Co. Ltd.

Promotion of Investment and Financing for Energy

Daiwa Energy & Infrastructure Co. Ltd. (DEI) was launched as the successor to the energy investment division of Daiwa PI Partners, andstarted operation on October 1, 2018. The company aims to provide new value as a member of an integrated securities group with ahybrid business model, and contribute to SDGs through investment and nancing for renewable energy, infrastructure, and resource
elds.
Daiwa Energy & Infrastructure Co.Ltd.
Renewable Energy Power Generation Projects
DEI has been actively working on development of and business investment in renewable energy generation projects,
taking advantage of the Daiwa Securities Group's network.
Of the 16 solar photovoltaic power plants developed and invested in by the company as of the end of May 2020, the 10
plants which are currently owned and on which construction was completed have all been operating stably. The solar
photovoltaic power plants under construction in Minamikyushu City, Kagoshima Prefecture (11 MW), Shiraoi Town,
Hokkaido Prefecture (35 MW), and Naka City, Ibaraki Prefecture (35 MW) will be completed by the summer of 2020, theend of 2020, and the end of 2021, respectively.
In the biomass power generation eld, DEI has been steadily promoting the development of wood biomass power
generation plants that use tree trimmings in Japan as their primary source of fuel. The development is underway with
Green Thermal Co. Ltd., with which DEI has formed a capital and business alliance. The commercial operation of a plantin Yonezawa City, Yamagata Prefecture began in January 2018 as the rst alliance project, and a plant in Kamitonda,
Wakayama Prefecture as the second project also began in June 2020.

Stations developed/ invested in by DEI
Photovoltaic power stations
Output: Approximately 213 MW in total
A breakdown is shown below.

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SDGs report 2020

Stations in operation: Approximately 132 MW (total for ten stations)
Stations under construction: Approximately 81 MW (three stations)
Projected amount of electricity generated annually: Equivalent to the amount for approximately 44,000 households
Biomass power generation plant
Output: Approximately 13 MW in total
A breakdown is shown below.
Stations in operation: Approximately 13 MW (two station)
Projected amount of electricity generated annually: Equivalent to the amount for approximately 20,000 households
Initiatives for the Woody Biomass Power Generation Field
DEI has formed a capital and business alliance with Green Thermal, a leading company for the development andoperation of woody biomass power generation plants, and Biomass Fuel Co., Ltd., a biomass fuel supplier. It has been
actively promoting not only the construction of power plants but also the expansion of its value chain in the biomasseld.
In collaboration with Biomass Fuel, DEI has been working to expand the procurement of palm kernel shell (PKS) - fuel forbiomass power generation - and develop wood pellet manufacturing plants mainly in Southeast Asia. Construction of apellet plant is currently underway in Vietnam.
Furthermore, in December 2018, DEI invested in Bioendev AB, a Sweden-based torrefaction* technology company, aiming
for technological evolution and global expansion of the biomass fuel-related business.
The woody biomass power generation business uses carbon-neutral power generation facilities that do not a ect theamount of carbon dioxide. Moreover, since it adds new value as fuel to wood trimmings from forests and PKS that havebeen left and discarded, it is expected to generate new industries and employment and contribute to local economies inJapan as well as the promotion of industry in developing countries.
* Technology that increases the energy density of wood pellets, etc. through the formation of carbide from woody biomass and othersubstances, thereby enhancing the e ciency of transportation and storage.

SDGs× Local Community

Expansion of Solutions Provided in the Business Succession Field (Establishment of Daiwa ACA BusinessSuccession Fund)

About half of the small and medium-sized companies in Japan do not have successors. If this situation continues, Japan may lose
approximately 6.5 million jobs in total and ¥22 trillion worth of GDP in the next 10 years. Business succession is thus a major social
issue.
Daiwa ACA Business Succession Fund, established in October 2018, helps small- and medium-sized companies to pass on their
excellent technologies and services to the next generations. By supporting business succession, the fund also encourages theinnovation of technology and services with continuity. Through this fund, Daiwa Securities Group will promote Japan's sustainableeconomic development.
Daiwa ACA Business Succession Fund[PDF: KB]

Promotion of Sustainable Agricultural Production BusinessA new type of agricultural business using ICT and other technologies is attracting attention as a solution to the aging of people
engaged in farming and shortages of successors - problems faced by Japan's agricultural sector.
In November 2018, Daiwa Securities Group established Daiwa Food & Agriculture Co. Ltd (DFA). The new company is aimed at assisting
expansion of the scale of business related to agriculture and food and enhancing e ciency by providing risk money to help actively
introduce new technologies.
In the spring of 2019, Daiwa Food & Agriculture launched an agricultural production business, starting with the acquisition of a42

SDGs report 2020

production facility for baby leaf vegetables in Kumamoto Prefecture. Moreover, in the spring of 2020, it took a stake in agricultural
corporations in Kawanishi Town, Yamagata Prefecture and Kusu Town, Oita Prefecture, which both sell tomatoes cultivated in largescale greenhouses in their respective areas. Taking advantage of cultivation using large-scale horticultural facilities and expertise inoperating such facilities, the company itself handles the agricultural production business.
Going forward, Daiwa Food & Agriculture will continue to pursue expansion of scale and increase in e ciency of agricultural
production to contribute to the invigoration of agriculture, a social issue Japan should look to resolve. The company will thereby put
into practice SDG Goal 2 “Zero Hunger” and Goal 9 “Industry, Innovation and Infrastructure.”
Daiwa Food & Agriculture Co. Ltd

SDGs×Life

Full-Scale Entry into the Healthcare Field

Social challenges are piling up in the healthcare eld, including the rapid expansion of demand for medical and nursing care and thenecessity of reducing medical costs. Through Daiwa ACA HealthCare Inc., which has investment and lending expertise in the medical
and nursing care business, Daiwa Securities Group aims to solve social issues in the eld by the provision of funds for hospital andnursing care businesses and support for succession and management of medical institutions, in Japan and overseas.
Daiwa ACA HealthCare Inc.

Provision of High-Quality Nursing Care Services

Providing quality nursing care services is a pressing issue in Japan as its elderly population is expected to continue increasing. To date,
Good Time Living Co. Ltd. has worked on nursing care that helps residents to live independently and improve their condition, rather
than simply providing assistance for their disabilities. The company also adopted ICT equipment and technology ahead of others in theindustry. In 2019, it completed introduction of mobile devices to all of its 32 facilities, leading to increased e ciency in operations notincluding physical assistance. In order to change the current state of nursing care services to address the progressive aging of the
population, Daiwa ACA HealthCare Inc. will promote the development of an environment that allows nursing care sta to demonstrate
higher levels of expertise, as well as the hiring of overseas personnel. We will thereby contribute to the achievement of SDG Goal 3“Good Health and Well-being” and Goal 8 “Decent Work and Economic Growth.”
Good Time Living Co. Ltd.
Speci c Case of IT Use

A nursing care recording system Carewing (institutional version)

Management of resident data with mobile
devices carried by sta

Care-wing (institutional version) was
developed jointly with the
manufacturer. It digitalizes the sta
operations list, leading to a
reduction in overtime work, as it
helps to save time required formaking changes and revisions

The home-visit nursing care records
managed on Care-wing areautomatically incorporated into
CARE KARTE, a nursing care record
system. The integrated managementof data on residents’ health and lives
has contributed to eliminating paper
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SDGs report 2020

compared to conventional paperbased management.

and saving labor in nursing carefrontlines.

A next-generation predictive monitoring
system Neos＋care®

A drop-down in-wall nursing care lift for
in-room transfers Swing Lift CoCoRo

Arti cial intelligence (AI)-based robot
Aeolus Robot

Daiwa Securities Group provided its
accumulated expertise to the
manufacturer and jointly developed
a biometric monitor equipped with ahighly precise monitoring function.
The monitor helps to prevent andpromptly detect accidents that haveoccurred in rooms, and also allows
for visualization of living
environments, while protecting
privacy, due to its adoption of an
infrared sensor. It thus helps toprovide services, including
environmental improvement andcare, which are suited to each andevery resident.

The instrument supporting in-roomtransfers helps reduce lower backpain and protect the safety andhealth of care sta . At the same time,the instrument has enabled sta toassist in-room transfers in a
comfortable position while
communicating with the guest, andthis has contributed to reducing
both the physical and mental burden
on the guest.

Investigation is underway on thepossible use in nursing care practice.
We will advance the development ofan environment that allows care sta
to focus on providing nursing careservices with higher added value by
having the robot assume simple
work.

* As to use of the instrument, please see
the video below. (in Japanese)
https://youtu.be/y aX RSLQE* As to use of the system, please see thevideo below. (in Japanese)
https://youtu.be/lsK h mU vM

Contribution to Local Communities through Investment Activities of REITs
Daiwa Real Estate Asset Management contributes to local communities by addressing social issues through investment
corporations and funds that entrust it with asset management.

Initiatives against COVID-

As an initiative against COVID- , Daiwa Real Estate Asset Management donated ¥5 million in collaboration with Daiwa
Securities Group Inc. for supporting accommodation fees under “Room Support Plan for Medical Professionals”
implemented at hotels operated by JHAT Co., Ltd. In addition, a hotel close to Haneda Airport owned by Daiwa Hotel
Private Investment Corporation, which is managed by Daiwa Real Estate Asset Management, has been used as atemporary quarantine facility for people who have returned from overseas.

Earthquake Preparation Initiatives

Daiwa Real Estate Asset Management has implemented earthquake countermeasures for building users and local
residents. For example, the company has placed emergency cabinets in the elevators of o ce properties owned by Daiwa
O ce Investment Corporation and installed disaster-responsive vending machines in rental residences owned by Daiwa
Securities Living Investment Corporation (DLI) and Daiwa Residential Private Investment Corporation.
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SDGs report 2020

E orts to Address Aging

Employees working at the investment division of Daiwa Real Estate Asset Management visit healthcare facilities owned by
DLI nationwide several times each year. They participate in hands-on events, such as family get-together meetings andmeetings to show respect to the elderly, while assisting with daily work, including cleaning the periphery of the facilities,
pruning plants in the courtyards, and pulling out weeds. They also participate in hands-on training to experience work as
facility employees in an e ort to deepen their understanding of frontline work. Daiwa Real Estate Asset Management
started these initiatives in order to deepen its understanding of the daily work of facility operators and the services
provided to residents. The initiatives are now positioned as local community contribution activities through the corebusiness, and we will continue to work actively on these initiatives.
Investment in Drug Development Ventures and Other Businesses by DCI Partners
We at DCI Partners have been investing in the biotech eld for more than 20 years, including the period of NIF Ventures(now Daiwa Corporate Investment). We currently manage one of Japan’s largest funds focusing on drug development,
making biotech venture capital investment in Japan and Taiwan. Through the fund, DCI Partners strives to help advancedevelopment by providing managerial resources and hands-on support from strategy planning to implementation. With
COVID- spreading rapidly, biotech startups began working on countermeasures against it. Among the investee
companies of the fund, some have started developing drugs and vaccines for the virus, with a view to initiating clinical
trials in 2020, while others have submitted applications for marketing approval. Since countermeasures against apandemic require speed and innovative technological capability, biotech startups are expected to attract more attention
and play a larger social role than ever before. DCI Partners will support these companies through its investment activities,
work to provide treatment options to patients, and strive to contribute to the health of all people and society.

Toward Global Realization of Financial Inclusion
Initiation of Services by New Securities Company “CONNECT”
Smartphones and other technical innovations are changing the common perception of
securities companies as targeting only a uent customers who have an advanced level ofnancial knowledge, in other words, companies with a high access threshold. At present,with everyone having a sophisticated digital device at hand, we recognize that in such anera, generating securities services available to all people in consideration of nancial
inclusion is an issue facing not only Daiwa Securities Group but also the securities
industry as a whole.
CONNECT Co. Ltd., which began providing services in July 2020, is a new type of securities
company created by Daiwa Securities Group. It chie y handles transactions in units of
one share and provides services mainly targeted at people in the digital native
generation. The company provides and completes all services—from the opening of an
account to securities trading—on smartphones, enabling anyone to use securities
services, starting with a small amount of investment, as long as they have a smartphone.
Under the concept “Create your future, starting with your rst share,” CONNECT willcontinue to develop and provide its services so that all people will be able to accessbetter nancial services.
CONNECT Co. Ltd.
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SDGs report 2020

Support for Reconstruction Following the Great East Japan Earthquake
The Great East Japan Earthquake SME Reconstruction Support Fund
Daiwa Corporate Investment Co., Ltd. operates the Great East Japan Earthquake SME Reconstruction Support Fund,receiving investment from the Organization for Small & Medium Enterprises and Regional Innovation, JAPAN (SME
Support, Japan), The Aomori Bank, Ltd., The Bank of Iwate, Ltd., The 77 Bank, Ltd., The Toho Bank, Ltd., and otherinstitutions. Targeting unlisted private companies in the disaster-a ected areas, the fund aims to expeditiously provide
risk nance. The goal is to actively support companies in their e orts to secure renewed growth and development by
supplying nance for a variety of purposes. These include restoration and reconstruction following the 2011 earthquake
disaster, new business development, the shift to a new industry or line of business, business reorganization andsuccession, and business incubation. The fund thereby aims to contribute to the early restoration and sustainable
development of the disaster-a ected areas.
Support for the "New Tohoku" Restoration Business Contest 2019
Since FY , Daiwa Securities Group has been supporting the Restoration Business Contest, which recognizes andsupports business plans that lead to the restoration of the areas a ected by the Great East Japan Earthquake. In addition
to the grand and excellence awards, the “Daiwa Securities Group Phoenix Award” has been established as a corporate
award, and it was granted in FY to Phoenix Corporation (Morioka City, Iwate Prefecture), which aims to develop asafe and secure snowplow system.
The daily work of removing heavy snow is an extremely serious issue for the disaster-a ected areas struggling with labor
shortages resulting from the declining population and the aging of the society associated with depopulation. This system
will enable even the elderly and women to remove snow easily in a safe and secure manner, and the development of thesystem is expected to help improve the quality of life in winter in the disaster-a ected areas and create jobs. For thisreason, Daiwa Securities Group intends to support this initiative.
We will continue to actively carry out these activities so as to be able to contribute to the reconstruction of the Tohoku
region.

Commemorative photo of the Reconstruction Agency, sponsor
companies, and award recipients(“New Tohoku” Restoration Business Contest 2019)

Then Daiwa Corporate Investment President Yanagihara (at thattime, left) and an award recipient(“New Tohoku” Restoration Business Contest 2019)46

SDGs report 2020

Support for Developing Human Resources Responsible for the Next
Generation
Support for Developing Human Resources Responsible for Next Generation Innovation through "Sido Next Innovator
2018", "Sido Next Innovator 2019".
Daiwa Institute of Research (DIR) was entrusted by the Ministry of Economy, Trade and Industry with secretariat work for"Sido Next Innovator 2018" jointly with World Innovation Lab (WiL, LLC). Under the theme "Thinker to Doer," the program
solicits and selects a wide range of people, including those taking up the challenge of generating innovation and thoseworking on challenging new business at major companies. It aims to develop global human resources who will play amajor role in next-generation innovation by providing selected applicants with lectures, seminars, workshops, mentoringand interaction with investors and entrepreneurs in Silicon Valley. The program was initiated in FY , and FY
marks its fth year.
The program runs for a total of 10 months - two months of open application and selection and eight months of program
implementation. In FY , applications were solicited from May to June 2018, and 126 successful candidates (program
recipients) were selected from among 345 applicants based on rigorous evaluation.
In the domestic program, which kicked o in July, participants went through lectures, workshops, mentoring (in whichskilled workers with a wealth of experience called mentors engage in dialogue with and provide advice to unskilledworkers to encourage growth and the brushing up of business plans), pitch contests, and other training to brush up theirbusiness plans and enhance presentation skills. Alongside the domestic program, the small-class program "Sido Café"
was provided for those who wished to participate. In the program, participants deepened their knowledge of speci c
topics.
In a pitch contest carried out on December 15, 2018, 20 participants were selected as delegates to Silicon Valley based on
the overall results of screening by application forms and pitch. The 20 participants took part in a two-week Silicon Valley
program in which they visited entrepreneurs playing major roles at local start-ups, personnel in charge of new businessdevelopment at large companies, and venture capitalists. They enhanced the quality of their own business plans throughsmall meetings and mentoring. Moreover, among those who were not selected as delegates to Silicon Valley, 31
applicants participated in a domestic follow-up program in which they continued to brush up their business plans.
A nal result reporting event ("Demo Day") was held on February 15, 2019. Demo Day featured pitches made by a total of
40 participants - 20 delegates to Silicon Valley and 20 participants in the domestic follow-up program, along withspeeches by guest speakers, exhibition booths set up by alumni and a panel discussion. DIR will continue to participate inprograms such as this which will lead to innovation.

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SDGs report 2020

For the Development of Financial and Capital Markets
The securities business, the core business of Daiwa Securities Group, serves as an important social and economic infrastructure. It
facilitates the smooth ow of money by matching fundraising needs through the issuance of securities and investment needs ofinvestors via nancial and capital markets. Maintaining and developing this infrastructure is about developing sound nancial andcapital markets for the next generation, which we identify in the Group's materiality in Finance. We consider this to be a major mission
for the Group toward the realization of SDG Goal 9 "Build resilient infrastructure, promote inclusive and sustainable industrializationand foster innovation."

Initiatives for Maintaining Market Functions
Role and Importance of Settlement Functions

Securities settlement - a mainstay of the Group's overall operations - is the delivery of stocks, bonds, or other instruments and funds
both to and from the buyer and seller of a securities transaction. Settlement functions also serve as a social infrastructure, andtherefore security, reliability, and convenience are important. In secure and trusted markets, nancial instruments can be reliably
converted into cash when necessary. This is the very reason why such markets attract investment money from all over the world andenable companies and others with funding demand to procure funds.
Number of settlement transactions handled
Daily
11,000 transactions on average
Annually
Approximately 2.8 million transactions (mainly by institutional investors within and outside Japan)
Responsibility as a Securities Company
In March 2020, Daiwa Securities introduced a full-scale teleworking system for all employees ahead of major industry
peers. While many companies, including us, have already introduced systems for working from home, Daiwa Securities’
new teleworking system is revolutionary in that it combines the development of an infrastructure by distributing a twoin-one device* to all 10,000 employees. This has enabled all employees, from those at frontline divisions to back o ce
divisions, to carry out work almost equivalent to that performed at the o ce no matter where they are. In settlement
operations, which should never be suspended, even during the COVID- pandemic, the new system has enabled us to
fully demonstrate our capability in achieving a balance between reducing employees’ risk of infection and ful lling oursocial responsibilities as a securities company.
If anything that could stall securities settlement should occur, it would not only a ect us but also damage trust in markets
as a whole. It could even have a signi cant impact on the global economy. We consider it vital to settle transactions
accurately and promptly as required in order to ensure that markets function as a social infrastructure and become adriver for economic development. We are therefore striving to build a structure enabling the smooth execution of48

SDGs report 2020settlement operations.
Amid the emergence of investors engaged in frequent trading utilizing computers, we have implemented a reliable
system that has high processing capability and can reliably settle a massive number of transactions. We believe, however,that no matter how well operations are systematized, the most important thing for the securities settlement operation isstill human resources. Sta members must have a wide range of knowledge to grasp the situation quickly when an
irregular event occurs and then respond to it appropriately. For that reason, we are making e orts to visualize andaccumulate the experience and expertise acquired through our daily operations, as well as expanding the businessknowledge of each individual and the scope of operations they can cover by providing cross-business training andcontinually rotating tasks.
Meanwhile, the securities industry recognizes that, to boost the competitiveness of Japan's nancial and capital markets,
it is necessary to further increase convenience and strengthen risk management. With this awareness, the entire industry
is currently working on reducing settlement time. Daiwa Securities has played a central role in a working group launchedby the Japan Securities Dealers Association, identifying and examining a variety of issues towards the reduction of
settlement time. The T+ (trade date plus one day) settlement cycle already started for government bond trading in May
2018, and the T+ settlement cycle for stock trading started in July 2019.
Moreover, cross-border foreign exchange transactions entail settlement risk associated with time di erences insettlement for the currencies involved (for example, the risk of being unable to receive dollars in U.S. time even whenpaying yen in Japan time). Daiwa Securities is the only Japanese securities company that participates directly inContinuous Linked Settlement (CLS) as a settlement member. We will ful ll greater responsibility for the stability ofnancial markets by reducing the settlement risk of foreign exchange transactions.
We are determined to continue settlement operations no matter what happens. In accordance with such determination,
we have drawn up a business continuity plan (BCP) and regularly conduct training in preparation for unforeseen
circumstances, such as the spread of new infectious diseases, natural disasters, and terrorism.
The reliability of settlement is extremely important for maintaining customer trust. We will continue to meet increasingly
sophisticated customer needs and quickly provide solutions by taking advantage of our reliable settlement infrastructureand human resources.
* A mobile device that can be used as a desktop PC within the company and as a laptop PC or tablet outside the company

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Considering Application of Blockchain/ Distributed Ledger Technology to Securities Business
Daiwa Securities and Daiwa Institute of Research (DIR) played central roles in carrying out the second phase of a project
to consider the application of blockchain/ distributed ledger technology (DLT) to the securities trade matching
operations*. The project was conducted jointly with 26 companies, including institutional investors, nancial institutions,and computer system companies.
This is a project using an industrial collaborative framework led by Japan Exchange Group. The rst phase of the project
was conducted in 2017, con rming the usefulness of the application of DLT to the trade matching operations. Following
such con rmation, the second phase of the project was conducted from September 2018 through January 2019. In thatphase, discussions were held on data items in the operations, the standardization of the operational process, policy on
operating the DLT infrastructure, and other issues. The project participants then drew up a more concrete plan toward
the construction of a system. The results of the project were released as a working paper in February 2019.
Daiwa Securities Group expects that the initiatives of this project will lead to the reduction of costs in the entire domestic
securities industry and the enhancement of convenience, which will ultimately contribute to the bene t of investors. We
will continue working to realize the plan in order to provide useful services to customers.
* Operations in which a securities company and an institutional investor con rm the trading volume, fee, etc. with each other after the
execution of securities trading

Initiatives for Development of Market Functions
Private Equity Investment in Myanmar
In 2016, Daiwa PI Partners started considering private equity investment in Myanmar in earnest following the country's
move to revise its laws and regulations, including corporate laws and investment laws, alongside its opening up of theeconomy and deregulation. The company has so far invested in ve deals.
In addition, Daiwa PI Partners established DAIWA Myanmar Growth Fund in 2019. Among the investee companies of thefund, DO Micro nance Company Limited, which engages in the micro nance business, contributes to the development of
the economy and improvement of people’s living standards by providing funds for business, including to the poor andwomen. Frontiir Pte. Ltd., a major Internet service provider, o ers people in Myanmar stable access to the Internet atreasonable prices. Rent 2 Own Holdings Pte. Ltd., which provides motorcycle rental and other services to individuals,
contributes to enhancing living standards of people in Myanmar by providing means of transportation indispensable for
their lives. Royal Golden Owls Co., Ltd., which operates an online e-commerce marketplace focusing on fashion andapparel products, provides a variety of products to a wide range of consumers in Myanmar, thereby helping to improve
people’s convenience and living standards.
In Myanmar, in which economic development has just begun, there are a large number of start-up companies with growthpotential. We believe that, by continuing to provide capital to these companies, we will be able to promote their growthand contribute to enhancing the social infrastructure and living standards of people in Myanmar.

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Myanmar SME/ Two-Step Loan Project for Agriculture and Rural Development
DIR has long been participating in the Republic of the Union of Myanmar Two-Step Loan Project for Agriculture and Rural
Development (known as "Agriculture-TSL") and the Project for the Development of Finance for Small and Medium-sizedEnterprises (known as "SME-TSL") together with Japan Economic Research Institute Inc. and Sanyu Consultants Inc. The
participation is part of our e orts to contribute to nancial inclusion, which is listed as an SDG target, and has continued
for eight years since 2012.
Agriculture-TSL is aimed at promoting agricultural mechanization in Myanmar and designed to assist Myanmar
Agricultural Development Bank (MADB) in enhancing its capacity to extend long-term low-interest loans suited to thepurchase of large agricultural machines. The project team provides practical training directly to more than 200 MADB
branches across the country through on-site visits, while making proposals aimed at improving the business e ciency of
MADB and advancing the modernization of its facilities.
SME-TSL sets up low-collateral credit lines and credit lines for companies doing business with Japanese companies withthe aim of improving small- and medium-sized companies' access to funds for capital investment. Technical assistancehas been provided to the overall banking operations of Myanma Economic Bank (MEB), which manages loans extended
through seven private-sector banks.
By playing central roles in these two projects, DIR has gained deep trust from the Myanmar government and privatecompanies and progressively increased its presence in the country. Both projects contribute to the economic
development of Myanmar, and DIR remains committed to working on projects similar to these that will contribute to therealization of SDGs.
Support for Stock Market Development in Vietnam
In March 2019, DIR started providing technical support aimed at development of the stock market in Vietnam as
entrusted by the Japan International Cooperation Agency (JICA). The company will implement a variety of support
measures including the provision of training in both Vietnam and Japan to the State Securities Commission of Vietnam(SSC), the supervisory authorities of the capital market, as well as the HoChiMinh Stock Exchange (HOSE) and the Hanoi
Stock Exchange (HNX), over a period of three years until February 2022. Speci cally, the support is centered on thefollowing four themes, aiming to enhance the transparency and fairness of the stock market in the country:
1. Reinforcement of the stock market's capacity for monitoring against unfair trading
2. Tightening of regulations on and supervision over securities companies
3. Improvement of listing management and screening procedures
4. Penetration of investor-oriented management approach
If this project helps improve the transparency and fairness of the Vietnamese stock market, it is expected to contribute to
the Daiwa Securities Group's business related to Vietnamese stocks in the medium to long term. That is because if
Vietnamese companies start incorporating a more investor-oriented perspective into their management, investor trust in
the stock market will increase, leading to market invigoration.
Support for the development of a stock market is aimed at contributing to the economic development of the relevant
country, and DIR will continue to actively provide support to other emerging countries as well.
Maintenance and Development of Financial and Capital Market Functions 28

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Corporate Governance
Daiwa Securities Group clearly separates the supervisory and executive functions of its management to create a highly transparent andobjective corporate governance system. We have adopted a structure in which Corporate Executive O cers of Daiwa Securities Group
Inc., as well as employees responsible for head o ce functions, concurrently serve in the securities subsidiary. This re ects our pursuitof a management structure that improves the e ciency of head o ce operations and maximizes synergy of each group company.
Corporate Governance Report[PDF: KB]

Basic Views on Corporate GovernanceWith group management based on a holding company structure, Daiwa Securities Group aims to achieve a highly transparent andobjective governance structure in international terms. The Group has built a uni ed group management system that elicits synergies
among group companies with highly e cient and specialized oversight of group companies.
The Group has adopted a company with Three Committees System with the objective of supervising management through:a. Better decision-making agility by having the Board of Directors assign signi cant authority to corporate executive o cers whileclarifying the division of duties among corporate executive o cers;b. More e ective supervisory functions at the Board of Directors from the appointment of outside directors with highly specializedskills, and better transparency in management from the establishment of the Nominating Committee, Audit Committee andCompensation Committee with outside directors a majority of their members and serving as chairpersons; andc. Highly independent and ethical outside directors providing advice from an outside perspective to the Board of Directors and thethree committees based on their knowledge and experiences.
The Group also proactively engages in CSR activities to gain the trust of stakeholders. CSR encompasses providing excellent products
and services to customers with integrity, appropriately returning pro ts and disclosing information to shareholders, creating pleasantwork environments and fair personnel evaluation systems for employees, strictly observing regulations and following corporate ethics,
managing the environment, and contributing to society.
Through these initiatives, the Group aims to further enhance its corporate governance structure in terms of transparency, agility ande ciency, in order to continuously improve corporate value.
The corporate governance structure consists of the Board of Directors and the three committees (Nominating Committee, Audit
Committee and Compensation Committee) as supervisory functions. Business execution functions are embodied in the Executive
Management Committee and its subcommittees comprising the Group Risk Management Committee, the Group Compliance
Committee, the Disclosure Committee, the Group IT Strategy Committee, and the Overseas Management Committee, as well as theGroup Internal Audit Committee, the internal audit organization that reports directly to the Chief Executive O cer (CEO).
To incorporate more diverse perspectives into group management, we have appointed four female directors and corporate executiveo cers. On a group-wide basis, nine female o cers serve as directors, corporate executive o cers, and executive o cers.
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Number of times each committee met (FY)

Nominating Committee

3 times

Audit Committee

17 times

Compensation Committee

4 times

Board of Directors

10 times

Rate of attendance at Board of
Directors meetings by outside
directors

100％

Major Initiatives in Corporate Governance

History of Daiwa’s Corporate Governance
June 1998

Elected outside auditors

April 1999

Became the rst listed Japanese company to adopt a holding company structure
Established the Advisory Board
Established the Group Management Committee

June 2000

Established the Compensation Committee

June 2002

Elected outside directors
Shortened directors’ terms of o ce from two years to one year

July 2003

Established the Internal Control Committee
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June 2004

Shifted to a Committee system (currently, a company with Three Committees system)

October 2015

Complied with the Corporate Governance CodeEstablished the Outside Directors Committee

April 2017

Appointed outside directors as chairpersons of all three committees

Point
Published the Corporate Governance Report detailing our response to the Corporate Governance Code
Decided that more than two members and more than one third of the Board of Directors should be independent
outside directors
Established the Outside Director's Committee in FY for the purpose of increasing communication amongst outside
directors
Have elected one additional outside director and six out of 14 Board of Directors as outside directors since FY
Strengthened management transparency and oversight functions by increasing the ratio of outside directors on the
Nominating Committee and the Audit Committee
Determined that all of the chairpersons of the three committees would be outside directors from FY while taking
steps to further improve the governance system
Supervisory Function
The Board of Directors consists of 13*1 directors, including 6 outside directors*2 and 3 female directors. The Board of
Directors determines key management policy, in addition to overseeing executive duties. In order to perform thissupervisory role from multiple viewpoints in accordance with the demands of society, the policy for selecting new board
members states that candidates must have a strong sense of ethics and demonstrate initiative and leadership.
Additionally, outside directors are experts in management and other elds. In addition, the supervisory function of Daiwa
Securities Group Inc. is reinforced by the Audit Committee and the O ce of the Audit Committee. The Audit Committee,
which consists of a majority of outside directors, plays a pivotal role in the supervision of executive duties. The Audit
Committee is assisted by the O ce of the Audit Committee, which is a department independent of execution of business.
*1. As of June 30, 2019
*2. Outside directors as de ned by Article 2-15 of Japan’s Companies Act

Audit Committee’s Activities
Daiwa Securities Group Inc.’s Audit Committee is engaged in auditing activities for duties executed by directors andcorporate executive o cers as part of corporate governance. In particular, it focuses on verifying the construction andoperational status of the internal control system.
For example, in FY , in order to con rm one of the priority issues of the audit policy, "E orts to realize and deepen
customer- rst business operations, the Audit Committee conducted hearings with the Compliance Department, Sales
Headquarters, and sales o ces and employee unions.
In February 2020, all Audit Committee members, including four outside directors, visited Daiwa Securities’ ComplianceDepartment and head o ce. They received explanations from the Compliance Department regarding monitoring54

SDGs report 2020

centered on VLS hearings and systems for inspecting sales branches, and from the head o ce regarding the conduct ofmeetings where opinions are actively presented, self-checks by sales sta , and measures for reviewing check methods bysenior sta . The members asked various questions, including about sales sta ’s time allocation methods and motivation.
They thus took advantage of the visit as a valuable opportunity to deepen their understanding. The Audit Committee willcontinue to deepen its understanding of the Group’s operations and proceed with initiatives to strengthen the Group’s
corporate governance system.

Audit Committee members receiving explanations from theCompliance Department

Visit to the o ce oor of the head o ce

Preventing Con ict-of-Interest Transactions between Group Companies
Con ict-of-interest transactions can occur between Daiwa Securities Group Inc. and Group companies in situations suchas intra-Group transactions. Daiwa Securities Group applies rules regarding con icts of interest stipulated by Japan’sCompanies Act to the Executive Management Committee as well as the Board of Directors. Con icts of interest between
Daiwa Securities Group Inc. and Group companies are appropriately prevented through a rule prohibiting an executiveo cer from voting when he or she concurrently serves as an o cer of an interested Group company and thus has a
special interest in a matter to be decided.

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Executive Compensation that is Closely Linked to Performance
Compensation for directors and corporate executive o cers is based on the following fundamental policies.

Compensation Committee’s Policy on Determination of Compensation of Directors andCorporate Executive O cers
To create e ective incentives, which contribute to the increase of shareholders’ value through soundbusiness development and also lead to the improvement of business performance in the short term as wellas the medium and long term.
To maintain a remuneration level which is competitive enough to recruit and retain people not only inJapan but also in the world as a global securities company group.
To ensure the execution and supervision functions operated e ectively as a company with a nominating
committee, etc.
Compensation for directors and corporate executive o cers is determined by the Compensation Committee.
Executive compensation has three components: basic compensation; performance-based compensation; andshare price-linked compensation. The details of each component are as follows:
Basic Compensation
A xed amount calculated based on his/her position, duties and role.
Performance-linked remuneration
Determined depending on the level of individual contribution, based on consolidated ROE and consolidated ordinary
income, which are settled as Performance KPIs of the Medium-Term Management Plan, while also comprehensively
taking into account achievement status of the managerial goals set in the Medium-Term Management Plan, and the like.
Does not apply to directors who do not serve as corporate executive o cers.

Stock-linked remuneration

To increase the link between remuneration and shareholders’ value, granted by the Company as Restricted Stock, etc.,
the value of which corresponds to a certain percentage of base remuneration.
Does not apply to outside directors.

Internal Control System and Internal Audit
In recognition that management is responsible for maintaining an internal control system to ensure the sound andappropriate execution of business, the Group, under the main initiative of Daiwa Securities Group Inc., has established asystem for managing the Group’s major business risks. Through this system, the Group endeavors to ensure businesse ectiveness and e ciency, reliable nancial reporting, compliance with laws related to business activities, and asset
preservation. Internal auditing departments verify the e cacy of this.
The Internal Audit Department veri es the internal control system. This department sits independently from all otherdepartments, reports to a dedicated corporate executive o cer, and ensures internal audits to act as an importantfunction of raising Group value through the creation of a sound and e cient internal control system. It seeks to raise
corporate value by e ectively conducting internal audits, and primarily implements risk-based internal audits.
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The Group’s business activities to which the Internal Audit Department pays special attention
The internal control systems at Daiwa Securities Co. Ltd. and overseas o ces as a global nancial instruments business
operator
Internal control systems at Daiwa Next Bank, Ltd. as a bankStatus of businesses that involve collaboration between Group companies and with companies outside the Group
Status of management of new risks arising from expansion into new business elds
Status of control over Group companies by the holding company

Authorization of Plans and Reporting of Results
The authorization of internal audit plans and reporting of audit results are undertaken by the Group Internal Audit
Committee. Internal audit plans are authorized by the Audit Committee or an appointed Audit Committee member who
has received the prerequisite authority from the Audit Committee. The results of audits are also reported to the Audit
Committee. Reports to the Group Internal Audit Committee are not limited to the audit results conducted at Daiwa
Securities Group Inc. and Daiwa Securities Co. Ltd. , but also include highly important ndings made during audits
conducted on Group companies in Japan and overseas.

Internal/External Group Cooperation and System Enhancements
The Internal Audit Department collaborates with the internal auditing departments of domestic and overseas Group
companies through periodic meetings, monitoring, and audit activities.
The Internal Audit Department maintains communications with the Audit Committee and accounting auditor, making any
necessary adjustments to ensure that audits are performed e ciently, and receives audit requests from the Audit
Committee. The degree to which these internal auditing activities satisfy The Institute of Internal Auditors’ “International
Standards for the Professional Practice of Internal Auditing,” the global standard for internal auditing, is routinely
evaluated by independent third parties, which helps to constantly improve its system.

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Structure and Achievements of Whistleblowing System (Corporate Ethics Hotline)
Since January 2003, Daiwa Securities Group has been operating a Corporate Ethics Hotline, through which employees
can report problems in the workplace directly to a corporate ethics o cer of Daiwa Securities Group Inc. or outside
lawyers. The system mainly aims to detect corporate misconduct—which includes violations of the Financial Instruments
and Exchange Act and other laws, regulations and rules that include bribery and corruption—in its early stages andprevent such misconduct from occurring.
We declare the protection of callers in our regulations, stipulating that the executives and employees of Daiwa Securities
Group may not cause detriment of any kind (dismissal, demotion, pay cuts, cancellation of worker dispatch contracts,
replacement, etc.) in relation to reports by callers, may not ask people who have information on callers to disclose suchinformation, and may not seek to identify callers or search for any other information about them in relation to reports.
When the hotline is contacted, the corporate ethics o cer, in cooperation with the internal control o cers at each Group
company, carries out a fact nding investigation, while taking steps to protect the caller. In FY , 42 reports werereceived through the whistleblowing system.

Number and breakdown of reports to Corporate Ethics Hotline
MatterNumber

Percentage

Harassment-related

17

40%

Compliance violation-related

10

24%

Workplace environment/manners-related

9

21%

Expense/cost-related

2

5%

Labor management-related

1

2%

Other

3

7%

The Group is working to ensure that all employees are familiar with the Corporate Ethics Hotline, including sta at
a liated companies and temporary workers, in order to ensure that anyone can use it without hesitation. We are also
making e orts to respond quickly when calls are received. The Group is taking steps to improve the hotline so that it canwork e ectively as a deterrent to prevent problems before they occur, not just as a measure to solve problems.

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Compliance
Daiwa Securities Group has four corporate principles. They are “building trust,” “placing importance on personnel,” “contributing tosociety,” and “maintaining healthy earnings results.” The Group believes that compliance is a signi cant element for achieving theseprinciples. The goal of the Group’s compliance activities is not merely to “comply with laws and regulations,” but to earn the trust ofcustomers, markets, society, and stakeholders.

Compliance System
The compliance division of Daiwa Securities Group consists of the Compliance Control Department and the Compliance Department.
The former is mainly responsible for overall compliance planning and formulation and also plays a role as a gatekeeper to the market.
The latter is tasked with providing support to sales branches and headquarters departments and divisions. The two collaborate tobuild a compliance system, working concurrently for Daiwa Securities Group Inc. and its subsidiary Daiwa Securities.
At Daiwa Securities Group, the compliance system focuses on three key issues: securing the fairness and transparency of the market,
eliminating any relations with anti-social forces (including countermeasures against money laundering and funding of terrorism), andmaintaining information security. With these issues in mind, it supports Daiwa Securities and other Group companies.
At Daiwa Securities, the Compliance Department monitors transactions and solicitation by sales branches, identi es challenges andissues, and visits sales branches to check their business status and provide instructions. The department also regularly conducts onsite inspections. Moreover, it visits the work sites of headquarters departments and divisions directly, identifying issues and providing
training support. The Customer Counseling Center, established within the Compliance Department, comprehensively handles
customer feedback and complaints and re ects them in the business to improve customer satisfaction.
One of Daiwa Securities’ strengths lies in its stationing of full-time internal administrators belonging to the Compliance Department at
all sales branches. The internal administrators work on improving the e ectiveness of the PDCA cycle (plan, do, check, act) at eachsales branch. They also closely cooperate with the Compliance Department in an e ort to build a solid compliance system.
Sta members in the compliance division—the Compliance Control Department, the Compliance Department, and internal
administrators at sales branches—total approximately 250 as of April 1, 2020. They are striving to strengthen Daiwa Securities Group’s
compliance system.

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Full Implementation of “Customer-First”
Daiwa Securities is taking measures in line with the compliance program to ensure the e ective operation of our internal
control system and strict compliance of our sales activities with laws and regulations.
For FY , we set up the pillars outlined below, maintaining “Customer-First” as the keyword, as in the previous scalyear.
1. Penetration and rm establishment of “Customer-First Operations”—pursuit of the greatest bene t to customers
2. Reinforcement of countermeasures against money laundering/funding of terrorism
3. Exercising of proper functions as a gatekeeper to the market
4. Reinforcement of compliance systems at overseas sites
Daiwa Securities markets various nancial products, including investment trusts. When soliciting investment from
customers, we ensure compliance with the principles of integrity and fairness, suitability, and self-responsibility, from theperspective of investor protection. We have adopted the practice of systematically providing continuous and thoroughafter-sale follow-ups, rather than leaving it to individual sales sta , especially when the market is trending downward. We
believe that providing thorough, face-to-face explanations to customers and maintaining customer trust and a sense of
security at times of market uctuations are part of the practice of Customer-First for Daiwa Securities as a marketer ofnancial products. We will continue stepping up such initiatives going forward.
Daiwa Securities Group’s Customer Inspection System
Daiwa Securities Group recognizes that the nancial and capital markets are an important infrastructure for society. We
also believe that sustaining trust in the markets is an important role that we must play.
For example, to maintain trust, it is important for nancial institutions, such as Daiwa Securities Group, to eradicate antisocial forces in response to particularly strong social demands in Japan. Internationally, it is also important to preventthe use of the nancial and capital markets by terrorists, organized criminal groups engaged in money laundering andother crimes, as well as organizations and individuals designated by international institutions. For this reason, Daiwa
Securities Group has put in place a structure to inspect new and existing clients
1. We undertake the following procedures for all new clients, including customers opening a new account with Daiwa
Securities.
(1) Compare with our own database constructed using information obtained from news reports, the Internet, and other sources(2) Compare with databases provided by public and other institutions(3) Utilize overseas information provided by Japan Center for International Finance

2. We regularly check for matters of concern related to existing clients and conduct further investigation if necessary.
When a problem is identi ed, we promptly terminate or exclude trading.
3. We strive to obtain the latest information in collaboration with the police, the bar association, and other externalorganizations aimed at eradicating anti-social forces.
4. We conduct training for executives and employees at our Group companies every year. The training is designed toraise their awareness of the importance of eradicating anti-social forces and countermeasures against money
laundering and the provision of funds to support terrorism, as well as to share knowledge of the latest laws andregulations, and relevant cases.
In particular, the importance of countermeasures against money laundering and the provision of funds to support
terrorism has grown worldwide. This has increased the need for implementing an e ective structure based on a riskbased approach to prevent such acts from occurring. We will work on reinforcement of our structure as an importantmanagement issue to ensure that Daiwa Securities Group is not used for money laundering or funding terrorism.

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Securing the Fairness and Transparency of the Market
Daiwa Securities Group is working to secure the fairness and transparency of the market from two standpoints. These are
how to check and prevent illicit transactions by investors and by Daiwa Securities itself. To prevent illegal transactions byinvestors, Daiwa Securities checks daily transactions by extracting deals that go beyond certain criteria, such as whether
they have an excessive impact on the market. In particular, in order to prevent insider trading from occurring, we ask
about customers’ place of employment and positions within their companies before registering their information. This
practice allows us to check transactions as soon as trading orders are placed by customers who are in a position toacquire internal information. We also check the past transactions conducted with us retroactively when timely disclosure
is made of important information.
To prevent illicit transactions within Daiwa Securities Group, we strictly manage not just material facts of listedcompanies but also broader information related to them in a similar way.
We have also introduced a system managing their information, keeping track of people obtaining information and where
information has been sent. Through these e orts, we have constructed a structure to prevent illegal transactions.
Preventing Con ict-of-Interest Transactions between Group Companies
Con ict-of-interest transactions can occur between Daiwa Securities Group Inc. and Group companies in situations suchas intra-Group transactions. Daiwa Securities Group applies rules regarding con icts of interest stipulated by Japan’sCompanies Act to the Executive Management Committee as well as the Board of Directors. Con icts of interest between
Daiwa Securities Group Inc. and Group companies are appropriately prevented through a rule prohibiting an executiveo cer from voting when he or she concurrently serves as an o cer of an interested Group company and thus has a
special interest in a matter to be decided.
Initiatives against Bribery and Corruption
In line with the principles of the United Nations Global Compact, Daiwa Securities Group works to prevent corruption.
Daiwa Securities’ code of ethics and conduct includes prohibitions on employees giving or receiving rewards orentertaining customers. Headquarters departments and o ces have also incorporated the status of observance ofmanagement rules on entertainment into self-inspection items since FY . Each department and o ce therefore
inspects their practice voluntarily, and the results of inspections are checked by relevant departments and divisions.
O cers in charge or relevant departments and divisions also monitor the use status of entertainment expenses at sales
branches to con rm that such expenses are appropriately spent.
With respect to dealings with government o cials, headquarters departments and o ces and sales branches all manage
such dealings separately. They thus keep an especially close eye on those dealings, as entertaining government o cials
is prohibited by law. Our management rules on entertainment also prohibit employees from giving bene ts togovernment o cials of foreign countries. In addition, we provide periodic e-learning training and engage in otherawareness-raising activities for employees to ensure that we are not involved in bribery or corruption.
We have also built a structure that prevents the fraudulent granting of bene ts at overseas worksites by establishinginternal rules that suit local laws and regulations.

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Information Security
We at Daiwa Securities Group have implemented numerous information security measures to protect personal
information entrusted to us by customers in a safe and precise manner.
In many personal information leakage incidents arising in recent years, leakage has occurred at third parties to which
operations have been entrusted. Accordingly, at the time of and after signing an outsourcing contract with a third party,
we thoroughly check the information management structure of the party. We also conduct on-site visits before
outsourcing to examine the business practices of the potential outsourcing contractor.
Following the enforcement of the My Number Act (the Act on the Use of Numbers to Identify a Speci c Individual in
Administrative Procedures) in October 2015, we now ask customers to provide us with their Individual Numbers. We havecontrolled access to information entrusted to us by customers, including Individual Numbers, by isolating suchinformation physically and managing it with extra care. No matter how much information is systematized, there always
remains a human element. To ensure that a mistake does not occur, we focus on training for sales personnel to recognize
the importance of information management, while keeping the number of employees authorized to access personal
information at the minimum level necessary. Daiwa Securities also in principle bans employees from taking personal
information out of the company. When it is absolutely necessary to take information out for business purposes, we
require employees to obtain prior approval from an internal administrator or other superior and to keep records, thereby
strictly managing such information. We also strictly manage the printing of personal information and output to external
storage media, while constantly monitoring whether there is any unauthorized use. Moreover, since some of the
documents received from customers are paper-based, we prepare special storage les to avoid the risk of losing
documents within the company.
In addition, we have developed and implemented a reporting ow in the event that an information leakage incident
occurs. Based on this ow, the department where the incident occurred immediately shares the incident with theinformation security administrator and reports to the department with responsibility for information management. The
incident is then reported to the management, including the o cer who takes charge of overseeing information security.
Fostering Compliance Awareness
Daiwa Securities Group considers it extremely important for each employee to always maintain a high level ofcompliance awareness. We have therefore adopted a compliance-related program in training for new employees and anumber of other internal training courses. We also give tests on compliance regularly through e-learning. At Daiwa
Securities, we post a “Personal Information Check Test” and “Compliance Digest” every Monday on our intranet and alsobroadcast compliance-related content about 10 times a year in our internal TV program which is aired every morning.
Moreover, at Daiwa Securities’ sales branches, the branch chief and the internal administrator lead an initiative toprovide training and instructions suited to each workplace on a daily basis. The branch chief also chairs a compliance
meeting in which all branch members participate. We have thus implemented various systems to keep the complianceawareness of all employees at a high level, and continue to foster awareness among employees.
Important Issues for FY and Beyond
We will continue with our initiatives toward the realization and evolution of “Customer-First Operations.” At the sametime, we will continue to reinforce our countermeasures against money laundering and funding of terrorism as achallenge for particular focus in FY . It is imperative that we comply with set rules, but we consider that the goal of
our initiatives should not only be to achieve such adherence. Compliance is a common theme that must be addressed by
the entire securities industry and it is also a matter of trust in the industry as a whole. We will therefore exchange
information with industry peers and proceed with measures while sharing good practices with each other. Daiwa
Securities Group will strive to strengthen compliance as a leading company of the industry going forward, and will makee orts to contribute to enhancing trust in the entire securities industry.
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SDGs report 2020

Risk Management
Daiwa Securities Group recognize the importance of identifying and evaluating the various risks associated with our business
operations accurately, and controlling them e ectively, while we pursues pro tability and growth. We aim to maintain a soundnancial base and pro t structure by properly balancing risks and returns and appropriately control not only short-term risks but alsorisks that are likely to appear in the medium- to long-term, such as climate change risk. By doing so, we seek to achieve sustainableimprovement in corporate value.
Response to the TCFD

Risk management system

Based on its RAF, the Board of Directors of Daiwa Securities Group Inc. has approved the Rules for Risk Management. The rules de ne
basic policies related to risk management, the types of risks that need to be managed, and the responsible executives anddepartments for each major risk. In order to establish an e ective risk governance system, we have created a Guideline for Three Linesof Defense and maintain a comprehensive structure for risk management.

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SDGs report 2020

Basic policies as de ned by the Rules for Risk Management Daiwa Securities Group
1. Management's proactive involvement of management in risk management
2. The structure of a risk management system that responds to features of the risks held by the Group
3. Understand overall risk based on integrated risk management, secure strong capital and the soundness of liquidity
4. Clarify the risk management process

Each of the Group companies conducts risk management that responds to the risk pro le and size of each business in accordance withthe abovementioned basic policies. The Risk Management Department and responsible departments for each risk within Daiwa
Securities Group Inc. monitor Group companies, and report the risk exposures and issues concerning the risk management system to
the Group Risk Management Committee. This is a sub-committee of the Executive Management Committee of Daiwa Securities Group
Inc., and it undertakes discussions and makes decisions about reported issues. In addition, major Group companies regularly hold risk
management meetings in order to strengthen their risk management systems.

Types of Risks to Be Managed / Managing Major Risks
Daiwa Securities Group faces various risks in the course of its business activities. The
Group therefore believes that it is important to identify these based on businesscharacteristics and risk pro les, and appropriately evaluate and manage those risks inorder to maintain a sound nancial base and earnings structure.
Risks that are particularly important for the Group are those that involve our key
securities business. Because the Group utilizes its own accounts to temporarily holdproduct positions for sales purposes and to provide products to customers, the Group is
subject to market risk due to market uctuations, foreign currency and other liquidity
risk, credit risk related to counterparties and issuers, and risk for which hedges do not
function, as well as operational risk that naturally occurs through the execution ofbusiness. The Group utilizes stress tests*1 and top risk management*2 to manage risk on
an integrated basis, including measuring the impact on capital and liquidity within theGroup from a forward-looking perspective.
*1. Stress tests are used for the integrated evaluation of impacts on capital, liquidity, and business systems based on probable stress scenarios that may
have a major impact on the Group*2. Top risk management is used to select and manage those risk events that stand to have a signi cant impact on the Group, in the event that such risks
should emerge, as top risks

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SDGs report 2020

(1) Market risk management
Market risk refers to the risk of incurring losses due to market uctuations, which a ect the value of stock prices, interest
rates, foreign exchange rates, and commodity prices. In terms of the Group’s trading business, by providing market
liquidity the Group acquires compensation while at the same time taking on market risk through the holding of a certain
amount of nancial assets. The Group implements suitable hedges to curtail uctuations in pro ts and losses. However,as hedges may fail to function e ectively in times of stress, the Group sets limits on Value at Risk (VaR)*1 and loss
estimates under various types of stress test*2 to ensure that they are within the scope of equity capital after taking into
consideration nancial conditions and such factors as the business plans and budgets of subject departments. The Groupalso sets limits on such facets as position and sensitivity.
The departments in charge of the Group’s trading services calculate positions and sensitivity for the purpose of assessing
their own market risk, and monitor such. Meanwhile, risk management departments also monitor the status of market
risk, con rm whether risk falls within the established limits, and report on such to management on a daily basis.
*1. Value at Risk (VaR) represents the maximum possible loss of a given trading portfolio with a given probability over a given time
horizon.
*2. Stress tests are used to calculate the Group’s maximum losses based on scenarios of the most signi cant market uctuations of thepast and due to scenarios based on hypothetical risk events.

(2) Credit risk management
Credit risk refers to the risk of losses caused in cases where a counterparty of a trade or the issuer of a nancial productheld by the Group su ers a default, or credibility deteriorates. The credit risk of the Group’s trading activities involves
counterparty risk and issuer risk.
When the Group provides products and engages in asset management and investments, there exists a risk that its
exposure to various products and transactions could be concentrated on speci c counterparty groups. If the credit
situation at such counterparty groups should worsen, large-scale losses could be generated. For this reason, the Group
sets limits on its total exposure to individual counterparty groups and monitors this exposure regularly.

Supplier risk
The Group sets an upper limit on the amount of credit that can be accepted for a trading partner group andmonitors it regularly.

Issuer risk

We also monitor the amount of credit risk of the issuers of nancial instruments held as a result of our market
making activities.

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SDGs report 2020

Daiwa Securities Group (Consolidated) Value at Risk
Range and Assumption of VaR
Scope: Trading accounts
Con dence level: 99% (one-side test), Holding period: 1 day
Adjusted for price correlation between products(Billions of yen)
18/6

18/9

18/12

19/3

19/6

19/9

19/12

20/3

1.34

1.39

1.76

1.06

1.33

1.42

0.94

1.22

High

1.80

1.67

1.87

2.29

1.68

1.55

1.61

1.77

Low

1.16

1.15

0.95

0.86

0.74

1.02

0.94

0.87

Average

1.40

1.36

1.34

1.45

1.18

1.27

1.28

1.18

Equity

0.65

0.51

0.40

0.29

0.38

0.39

0.34

0.19

Interest

1.21

1.23

1.68

1.06

1.16

1.35

1.21

1.12

Currency

0.16

0.17

0.24

0.18

0.21

0.24

0.20

0.20

Commodities

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

VaR (Month-end)
QuarterBy risk factor (Month-end)

Note: Management of market risk and credit risk unrelated to the trading business
Besides the trading business, the Group also owns operational investment securities related to theinvestment business, loans and securities related to the banking business, and investment securities that areheld for the purpose of maintaining business relationships. Those assets are also exposed to market andcredit risks, and risk management is conducted according to the risks that are unique to each line of business.

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SDGs report 2020

(3) Liquidity risk management
Liquidity risk refers to the risk of su ering losses due to cash management di culties or having to nance at markedly
higher costs than usual as a result of a change in market conditions or a deterioration of Group companies' nance.

Basic Policy on Fund Procurement
The Group conducts securities-related operations using a variety of nancial assets and liabilities, and makes
investments and loans that contribute to providing new value as an integrated securities group with a hybrid businessmodel. In order to prevent market uctuations from a ecting the continuation of our business activities, the Group isconstantly striving to secure the stability of fund procurement. Additionally, with the anticipation that nancial crises
may make it di cult to procure new funds and reacquire existing funds, the Group diversi es repayment periods andfund sources.

Liquidity management system using Liquidity Management Indicators
Daiwa Securities Group Inc. has established a liquidity management system that utilizes the regulatory consolidated
liquidity coverage ratio as well as its own liquidity management indicators.
The Group performs daily checks to ascertain that the liquidity portfolios in place are su cient to cover the repayment of
unsecured short-term funds due within a certain time period as well as the estimated out ow of funds under stress in an
appropriate time frame—here a number of stress scenarios are adopted. These e orts are made to ensure the Group cancontinue its business operations even when it becomes impossible to procure funds without collateral for a whole year.

Contingency Funding Plan
The Group recognizes the emergence of liquidity risks can have a direct impact that leads to the business failure of anancial institution. Accordingly, Daiwa Securities Group has put in place a contingency funding plan that prede nes therequired response methods, roles and authorities, and procedures, among others, in order to ensure that the Group
responds appropriately as a uni ed entity at the time of a liquidity crisis. This plan states the basic policy concerning thereporting lines depending upon the urgency of stress internally originated, including a credit crunch, and externallyoriginated including an abrupt change in the market environment, and the method of raising capital. The contingency
plan enables the Group to prepare a system for securing liquidity through a swift response.

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SDGs report 2020(4) Operational risk management
Operational risk is the risk of losses that occur when internal processes, people, and systems do not perform adequately
or do not function; it can also arise from external events.

De nitions of Principal Operational Risks
Type

De nition

Operations Risk

The risk of su ering losses due to the neglect of proper operations by
employees and executives or due to accidents or impropriety

System Risk

The risk of su ering losses due to computer systems going down,
malfunctioning, or experiencing system inadequacies, and the risk of su ering
losses due to the inappropriate use of computers

Information Security Risk

The risk that a threat to information assets could materialize, preventing
information security (con dentiality, completeness, or continued availability)from being assured

Compliance Risk

The risk of su ering losses due to the failure of employees and executives tocomply with corporate ethics or laws and regulations, and the risk of su ering
losses due to lawsuits with customers and other parties in Japan

Legal Risk

The risk of su ering losses due to the inappropriate conclusion of contracts,
breaches of contract, or lawsuits with customers or other parties in relation to
overseas o ces

Human Resources Risk

The risk of su ering losses due to problems in labor management or from thestandpoint of workplace safety, and the risk of being unable to securenecessary human resources

Tangible Fixed Asset Risk

The risk of su ering losses due to damage to tangible xed assets as the resultof natural disasters or external factors, or to negligence on the part of
executives and employees

The Group classi es operational risks into the seven categories listed in the above table and monitors them by assigning
departments responsible for individual risks. As the Group’s business becomes more sophisticated, diversi ed, andsystemized, the accompanying risks become more varied. As a result, the importance of managing operational risk has
grown each year.
Major Group companies control their operational risks appropriately by measures including risk control self-assessments(RCSAs), in accordance with rules on operational risk management set by Daiwa Securities Group Inc. In addition, theGroup has taken other necessary measures, including the implementation of rigid rules concerning authority, theautomation of o ce operations for reducing human errors, and the preparation of procedural manuals. Each Group
company strives to reduce operational risk according to the nature of its own business.
* RCSA (Risk Control Self-Assessment) uses a predetermined assessment sheet to identify and assess operational risks, analyzes risks
based on frequency of occurrence and impact, and evaluates and veri es e cacy of risk mitigation e orts.
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SDGs report 2020

(5) Reputational risk management
Reputational risk refers to the possibility of the Group sustaining unforeseen losses and the Group’s counterparties being
adversely a ected due to a deterioration of its reliability, reputation, and assessment caused by the spread of rumors or
erroneous information. There are no uniform procedures for managing reputational risk because it can emanate from avariety of sources.
The Group has established various regulations under its Disclosure Policy, with particular emphasis on the management
and provision of information. It has also set up the Disclosure Committee within Daiwa Securities Group Inc.
Each Group company is obligated to report information that could turn into reputational risk to the Disclosure
Committee.
That way, Daiwa Securities Group Inc. can obtain and centrally manage information, and it disseminates accurate
information in a prompt manner according to the decisions of the Disclosure Committee.
The Group strives to keep abreast of problems and occurrences that may a ect its reputation so that if and when suchproblems occur, their impact on the Group can be minimized. It also acts to ensure that erroneous and inaccurate
information is properly corrected, and that it responds appropriately to libel and other issues. The Group has public
relations and investor relations systems in place to prevent and minimize risks regarding its reputation.
(6) Accounting and tax risk management
Accounting and tax risk is the risk of not conducting appropriate accounting treatment and disclosure in accordance withaccounting or taxation standards, laws, and regulations, or of not ling or paying taxes appropriately, as well as the risk oflosses arising as a result.
The Group strives to reduce accounting risk by operating in accordance with fundamental regulations related to internal
controls on nancial reporting, and by establishing, putting into practice, and striving to improve its internal controls on
nancial reporting.
In addition, by notifying principal Group companies of necessary reporting items related to tax risk management andreceiving such items in a timely manner, the Group endeavors to appropriately determine the tax risk management status
and risk conditions for the Group as a whole, thereby reducing its tax risk.

Tax Policy
The Daiwa Securities Group has enacted "Daiwa Securities Group Tax Policy" in aiming to develop corporate
tax governance, and describes our code of conduct and standard of judgements in taxation.
Daiwa Securities Group Tax Policy
1. Daiwa Securities Group complies with laws and ordinances, and contributes to sustainable developmentof society through appropriate tax payments with high ethical standards.
2. Daiwa Securities Group rewards our shareholders by achieving sound pro ts based on proper and fair tax
planning.
3. For cross border intra group transactions, Daiwa Securities Group sets an appropriate price, which canachieve adequate accountability under transfer price tax regulations.
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SDGs report 2020

4. The CFO, executive o cer in charge of Finance, and Head of Finance Department of Daiwa Securities
Group Inc. from time to time provide guidance and advice to subsidiaries and other departments within
the Group as necessary, so that corporate governance over tax matters can be well shared andimplemented throughout Daiwa Securities Group.

Business Continuity Plan (BCP)
To be prepared for disruptions of social infrastructures, we have drawn up a business continuity plan (BCP). The BCP prioritizes
important operations to be restored or continued* in order to keep the nancial markets open and protect customers’ economic
activities. Disruptions of social infrastructure might make our head o ce functions, branches and data centers or other importantfacilities inoperative.
They can be caused by events such as earthquakes, res, storms, oods, other extraordinary weather conditions, terrorism, large-scale
power failures, and serious outbreaks of infectious diseases. In accordance with the BCP, we will not only ensure the safety ofcustomers and our employees, and protect our assets, but will also strive to continue our vital operations in the nancial markets
where our business serves the public interest. For example, we boast Japan’s highest level backup center, and have established asystem which enables us to easily switch to the alternate system in case of an emergency at headquarters. We can therefore continue
vital operations through a substitute o ce location.

Prioritized operations to be restored or continued
1. Carrying out securities transactions traded in the markets and yet to be settled
2. Payment to our customers
3. New orders from customers to sell or cancel the following products and sell securities back to exit a long position in
margin trading
Domestic listed shares, including closing long positions on margin transactions
MRF (money reserve funds)
Japanese government bonds for individual investors
Ordinary deposits

Measures to Address Disaster Risk by Region

Daiwa Securities has o ces across Japan. As disaster risk di ers amongst regions, it has formulated a disaster response plan for eachsales branch and is preparing disaster relief supplies that re ect the disaster risk for each branch. The hazard maps created by themunicipalities of respective regions are sent to branches and made available on our intranet.

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SDGs report 2020

IT Strategy and Management of Systems Risk
Under its Medium-Term Management Plan, “Passion for the Best” 2020, Daiwa Securities Group is promoting the IT strategy (basic IT
policy) of establishing an IT platform that provides momentum for the digital transformation. The Group is also working to further
strengthen IT governance in order to address the diversi cation of its business portfolios and the evolution of technology.

IT governance Structure

The Group IT Strategy Committee is established at Daiwa Securities Group Inc. as a sub-committee of the Executive Management
Committee, and the IT Strategy Committee is created at Daiwa Securities as a subcommittee of the Management Committee. These
committees deliberate and decide medium- and long-term IT investment policies and plans after taking into account business needs
and trends in the business environment, such as systems and regulations.
Against a backdrop of globally tightening nancial regulations, increasingly serious and sophisticated cyberattacks, greater
digitalization enabled by technological evolution, and unbundling of nancial services, the chief information o cer (CIO) has beenplaced in charge of overseeing all IT-related operations across the Group, including overseas bases and in new business lines based on
hybrid strategies, to ensure Group-wide risk management and business innovation. By managing IT resources and further
strengthening collaboration within the Group, the CIO is working to enhance the Group’s IT capabilities.

Status of IT investment

The Group has been investing in IT in order to provide products and services responding to customer needs from the perspective ofcustomer-oriented operations, promote a digital transformation which aims at improving the e ciency of existing business andadvance business innovation and business process innovation in order to engage in high value-added business, establish basic
infrastructure that is indispensable to the continuation of business, comply with legal requirements, and enhance the risk
management system.
In FY , the Group established an environment in which employees can focus more on further improvement of customer
satisfaction, such as by introducing business terminals and communication tools that are premised on telecommuting in order toenable working e ciently regardless of location, and increase the frequency of contact with customers. In addition, the Group
streamlined the business process, such as account opening, etc., by introducing paperless processes and automation, and launched a
new accumulation investment service, which allows customers to set and manage funding conditions according to their purpose. The
Group also worked on increasing the sophistication of risk management such as by strengthening measures against cyber-attacks andmoney laundering.

Systems risk management

Daiwa Securities Group has worked to maintain and enhance the management of systems risk in order to reliably provide high-quality
services to customers while protecting information assets from various threats and risks originating from inside or outside thecompany. In light of the growing threat of cyber-attacks over the past few years, we recognize the importance of cybersecurity as agroup management issue, and have accordingly established a cybersecurity management system centered on Group-wide DaiwaCSIRT*.
In recent years, new attack methods have been reported, including those that target terminals used for telecommuting and those thatin ltrate networks through Group companies, business partners, and contractors. Therefore, the Group continues to collect andanalyze the latest information on cyber-attack methods and vulnerability while coordinating with external organizations andcompanies, and continues to work toward improving its resistance and resilience to cyber-attacks.
* Computer Security Incident Response Team: the organization that manages cyber security across departments
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SDGs report 2020

Human Rights Education and Awareness
Daiwa Securities Group states in its corporate principles that “the Group will strive to maintain a high sense of morality and duty,
endeavoring to continue contributing to the sustainable growth of the societies in which we operate.” To improve a corporate culture
rooted in the basic principles of respect for human rights, we are further strengthening our e orts to educate and enlighten our
employees about human rights. We therefore respect the Universal Declaration of Human Rights, the OECD Guidelines forMultinational Enterprises, ISO 26000, the UN Guiding Principles on Business and Human Rights, and the Act on the Promotion of
Human Rights Education and Human Rights Awareness-Raising. We have also joined the UN Global Compact.

Basic Policy for Initiatives Addressing Human Rights and Social Integration Issues
1. Daiwa Securities Group supports and complies with the protection of human rights as advocated internationally anddoes not infringe on human rights within the boundaries of its in uence.
2. The Daiwa Securities Group educates and instructs Group employees with accurate information on human rights andsocial integration issues.
3. At the same time, the Group views human rights and social integration issues as our own problem, not somebody else’s
problem, and fosters a sensitivity that enables empathy with the su ering of others.
4. We provide an equitable working environment that values people and is free of discrimination or human rights
violations based on race, nationality, biological sex, sexual orientation, or gender identity.
5. Each employee is a member of society unburdened by prejudice.

Speci c E orts
1. We highly value the human rights of every stakeholder and our sta will always address clients, local communities andtheir members with great awareness of human rights.
2. We work to ensure that our hiring and recruiting, personnel evaluations and labor management practices are alwaysfair.
3. The Group is continually improving internal human rights education and awareness programs, including regulartraining and feedback and response loops.
Human Rights Awareness Promotion Committee
Revised on August 12, 2016

Human Rights Education and Awareness System
In 1984, Daiwa Securities Group set up the Human Rights Awareness Promotion
Committee. The committee aimed at promoting activities and training for raising
human rights awareness, thereby encouraging better understanding and72

SDGs report 2020

appreciation of social integration and other human rights issues. We have beenworking to achieve its objectives. Besides the committee, all Group managers at
the head o ce or branch level act in a promotional role, engaging in education
and awareness activities to ensure that employees correctly understand andacknowledge human rights and social integration issues.
Daiwa Securities Group has been a member of the Industrial Federation for
Human Rights, Tokyo, since 1998. The Federation is composed of 123 companies
mostly headquartered in Tokyo with a combined total of 1.5 million employees(as of April 2020). Federation members work together to further improve theiremployees’ awareness of human rights issues through research andcommunication.
Initiatives in FY
In FY , we provided human rights education as part of training for the Group’s new employees conducted
immediately after their induction ceremony. It is also included in training for young employees (annex education) and for
those newly becoming general managers, managers, and associate managers. The chief of the Human Rights AwarenessPromotion Committee Secretariat has taken charge of all of these training courses.
We have also been providing training on LGBT issues since FY . It has been conducted for those in the Group’s
compliance and human resources divisions. The issues are also taken up in training for new employees every year.
LGBT issues are also included in training for promoted employees as an opportunity to deepen their understanding. The
cumulative number of employees participating in training on LGBT issues is now 4,835.
The Group held a Human Rights Awareness Workshop for all executives and employees to consider human rights frommultiple viewpoints. Discussions between participants were held after watching “Introduction to Diversity,” aneducational video with the theme of the importance of respecting diversity.
We also called for human rights awareness slogans between October and November 2019 in a contest designed topromote a broader and deeper understanding of human rights issues. Contest participation was open not just to
employees but also to their families. The winning entries were presented in our in-house magazine.

Human rights education for employees for FY
Training
participants

545 new employees

Objective

To acquire basic knowledge concerning human rights and to understand and raiseawareness of the Group’s fundamental principles concerning respect for human rights

Training
participants

1,201 promoted employees

Objective

To acquire knowledge and raise awareness concerning human rights required for theirrespective positions73

SDGs report 2020

Supply Chain Management
Supply Chain Management and ESG Due Diligence including Human Rights
Daiwa Securities Group regularly checks documents disclosed by major business partners, including providers of IT equipment andservices, as well as news reports about these companies and their reputation on the Internet in order to address issues in the Group's
supply chain, including those related to the environment, society, human rights, information and cyber security. If any issues arefound, we take steps such as urging the business partners to make improvements.
We also collect information provided by public institutions within and outside Japan and exchange information with external parties tobe aware of human rights issues existing in the countries and regions where the Group conducts business operations. We then consider
taking appropriate measures for important issues.
We carry out due diligence in deals underwritten, considering not only business performance and nancial aspects, but also ESG
issues. When we nd issues regarding the business model of an issuer or its planned use of proceeds, we conduct more thorough due
diligence through such means as eld work and meetings, and sometimes make proposals for improvement to the issuer. If major
concerns remain even after taking such measures, we report them to Chief Risk O cer (CRO).
Similarly, we also carry out due diligence in self-investment deals

Daiwa Securities Group's Response to Issues in its Supply Chain
Subject

Speci c initiatives

Frequency

Major business partners including providers of
IT equipment and services

Check documents disclosed by partnercompanies and external information

Regularly

Countries where the Group conducts business
operations

Collect information on human rights issues

As needed

Deals underwritten

Due diligence in consideration of ESG

As needed

Self-investment deals

Due diligence

As needed

Response to the UK Modern Slavery Act 201574

SDGs report 2020Engagement with Shareholders and Investors
Daiwa Securities Group works hard to promote communication with shareholders and other investors. We will strive to provide
shareholders and investors with improved communications and information that are easy to understand.

Breakdown of Shareholders

Capital Policy
Daiwa Securities Group, aiming to achieve sustainable growth by earning healthy pro ts, will implement a capital policy that takes all
stakeholders into consideration by striving to balance investment in growth, improve capital e ciency, maintaining nancial health,and enhancing shareholder returns.

Dividend Policy
Daiwa Securities Group Inc. strives to continuously enhance shareholder value, including pro t distribution. In principle, dividends arepaid semiannually (interim and year-end dividends) at a payout ratio of 50% or more based on consolidated nancial performance.
However, after taking stability into account, when we can secure a su cient amount of internal reserves required for future businessdevelopment, we intend to increase returns to our shareholders, including share buybacks.

Shareholder Returns
We raised the target payout ratio to at least 50% from FY . When we can secure a su cient amount of the internal reserves required
for future business development, we intend to increase returns to our shareholders, including share buybacks. The full year dividend
payout ratio was 51.1% in FY , with the total return ratio standing at 92.5%.
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SDGs report 2020

Share buyback
Buyback period

From August 28, 2019 to December 3, 2019

Total number of shares repurchased

50 million shares(Percentage of total number of issued shares excluding treasury stock: 3.19%)

Total amount of shares repurchased¥25,081 million

Fair Disclosure
The Group has formulated a Disclosure Policy, which outlines the Group’s basic approach to information disclosure, and strives toprovide information that is fair, timely, and appropriate.
As a company engaged in the securities business, we are committed to fair information disclosure in accordance with the Fair
Disclosure Rules so that we will be a role model for other listed companies. We will strengthen disclosure not only of nancial
information, but also non nancial information with social and environmental aspects that are not apparent in the nancial gures inthe short term.

Disclosure Policy
We will observe fair and timely disclosure of important nancial, social and environmental information ("ManagementRelated Information") regarding the Daiwa Securities Group so that our stakeholders, (including shareholders, investors
and the communities we operate in) may understand and maintain realistic expectations of the Daiwa Securities Group.
We will comply with the Financial Instruments and Exchange Law and other laws and ordinances related to securities
transactions and the various rules of the nancial Instruments exchanges where on which our stock is listed.
We will endeavor to achieve fair disclosure both in terms of content and timing.
We will utilize various communication channels including presentations, telephone conferences, the Internet and printed
materials to disclose information in an easy to comprehend manner for investors.
We will consciously act as a leader of the securities markets in terms of disclosure and set the standards for other listed
corporations.
To realize the above policies we will establish Disclosure Regulations* and set up a Disclosure Committee to lay down
procedures for disclosing information.

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SDGs report 2020

Communication with Shareholders and Other Investors
Every year, many shareholders attend our general meeting of shareholders, which is an opportunity for us to interact directly witheveryone. To increase communication opportunities, we also carry out various IR activities. These include telephone conferences on
the days of earnings announcements, brie ngs about the company for individual investors, management strategy brie ng sessions,
one-on-one meetings with institutional investors and analysts in Japan and overseas, and participation in Daiwa Investment
Conferences held within and outside Japan.
From February 2020, we started refraining from holding brie ngs at venues and one-on-one meetings from the viewpoint of preventing
the spread of COVID- . However, we have been actively engaging in dialogue using alternative methods such as websites andtelephone to continue to communicate with our shareholders.
In addition, we are further developing information disclosure on our IR websites and publishing integrated reports and business
reports for shareholders. We will continue working to make our communications even more precise and easy to understand forshareholders. Feedback and questions received from shareholders are reported to the CEO and other management personnel on a
weekly basis, as well as at Board of Directors meetings.
Questionnaire for Shareholders
We distribute a questionnaire to shareholders coinciding with the distribution of rewards under our shareholder rewards
program at the end of September, to gather and incorporate their views into management and IR activities. The ndings of thesequestionnaires are utilized to enhance satisfaction with the shareholder rewards program and to improve our business
operations.
Shareholder Rewards Questionnaire Contents at the End of September 2019
When did you rst purchase our shares?
Why did you choose to buy Daiwa Securities stock? (multiple answers allowed)
What types of disclosure and corporate communications activities would you like to see enhanced in the future? (multiple
answers allowed)
Are there any products you would like to have included in the shareholder rewards program? (multiple answers allowed)

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SDGs report 2020

Shareholder Rewards Program
Daiwa Securities Group Inc. has been implementing a shareholder rewards program for over 10 years to express ourcontinuing gratitude to shareholders. We also introduced a catalog system for rewards at the end of March 2008. Reward
products are provided semiannually, at the end of March and September. Shareholders can choose from 30 items such as
regional specialties, charitable donations, and "Kaisha Shikiho," a quarterly journal on investment.
Starting with the shareholder rewards o ered to shareholders of record on September 30, 2017, if shareholders request
reward items on our website, we donate ¥20 per case to “Daiwa Securities Group Children Support Fund for a Bright
Future,” established in the Public Resources Foundation. We thus support activities for improving the environment
surrounding children and breaking the cycle of poverty through NPOs engaged in ghting child poverty.
It also became possible to select Single Mothers Forum, a certi ed NPO, as a donation recipient in the shareholder
rewards o ered to shareholders of record on March 31, 2019.
The contributions made will be used for initiatives to give congratulatory money to children in single-parent households
who enter elementary, junior and senior high schools and colleges.
Starting with the shareholder rewards o ered to shareholders of record on September 30, 2019, shareholders can choose
to receive a discount on the initial cost of private nursing homes under the name of “Good Time Living” and rental
residences for the elderly under the name of “Platesia,” both of which are operated by Good Time Living Co. Ltd., asubsidiary of Daiwa Securities Group Inc. A reward item was also added to the program for shareholders of record on
March 31, 2020, providing preferential services that can be used when staying at hotels owned by Daiwa Hotel Private
Investment Corporation.
For details on shareholder rewards, click here
Initiatives in FY

Dialogue with Various Stakeholders
Daiwa Securities Group continued to actively disseminate information contributing to the improvement of the Group’s
corporate value. We communicated the progress of our Medium-Term Management Plan, an overview of ourmanagement policy, and other information e ciently and e ectively in earnings announcements and management
strategy brie ng sessions, as well as in integrated reports and business reports. For institutional investors in Japan andabroad, we implemented e ective activities suited to each investor base, and held an IR roadshow by top managementfor overseas institutional investors. In FY , we nurtured relationships of trust with personnel responsible forexercising voting rights, in addition to analysts, portfolio managers, and others, through periodic communications. In
December 2018, we held an ESG meeting for institutional investors and analysts, with outside directors participating. In
FY , we conducted a total of 196 one-on-one ESG meetings, exchanging opinions with institutional investors. The
topics for these meetings varied widely, including materiality (important management issues), the status of responses to
TCFD, Net Promotor Score (NPS), the e ectiveness of the Board of Directors, cross-shareholdings, and director
compensation systems.
Moreover, following the increase in the ratio of individual investors, we also focused on brie ngs for individual investors,
with the CEO participating. We also held seminar style company brie ngs for individual investors on the Internet, in
addition to brie ngs at sales branches of Daiwa Securities, attracting the participation of many investors and large
audiences. Furthermore, we participated in brie ngs organized by Daiwa Investor Relations (Daiwa IR), a Group company,
78

SDGs report 2020and external companies with the aim of increasing contact points with individual investors. At these brie ngs, we provide
a question and answer session and conduct a survey, thereby obtaining diverse feedback to use for the improvement ofcommunication with individual investors in the future.
For details on IR events and brie ngs, click here

Number of overseas IR activities held in FY
Number of meetings withinstitutional investors and analysts

196 meetings

This includes the following overseas IR activities: two IR eventsin North America (18 meetings), two IR events in the EU (24 meetings), and two IR events in Asia (18 meetings)
Number of brie ngs for individual
investors

35

Brie ngs at Daiwa Securities
locations25

Brie ngs organized by Daiwa
Investor Relations

6

Brie ngs via the Internet

3

Seminar for female investors

1

Total number of live participants and ondemand viewers

Approx. 9,200

September 2019 seminar-style company brie ng for individual investors on the Internet (President and CEO Nakata)To view the video, click here79

SDGs report 2020

Communication with Stakeholders
Daiwa Securities Group recognizes that grasping social challenges as a company is an important issue.
In light of the rapid changes in the economy and society in recent years, social issues are also expected to change with the times. We
place importance on communications with various stakeholders as a method of continuing to grasp such changing social issues.
Through our business, we will resolve social issues identi ed by active dialogue with a broad range of stakeholders, including
customers, shareholders, investors, local communities and NPOs, in pursuit of balancing social values and economic values.

Policy on Communication with Stakeholders
Basic Policy (1)Daiwa Securities Group will strive to maintain two-way
communication with a broad range of stakeholders based on
ISO 26000 and the Charter of Corporate Behavior of the Nippon
Keidanren.
Basic Policy (2)The Group will strive to deepen communication withstakeholders already known to us, including customers,
shareholders and other investors, business partners,
employees and local communities.
Basic Policy (3)The Group will strive to communicate actively with third-party
institutions, organizations, and individuals, etc. with whom wehave previously had no contact in order to identify otherstakeholders.

Important external initiatives
Daiwa Securities Group has participated in, signed, and supports the initiatives described below to contribute to developing asustainable society.
The United Nations Global Compact (signed by Daiwa Securities Group Inc. in 2010)
The United Nations-supported Principles for Responsible Investment (PRI) (signed by Daiwa Asset Management in May 2006)
United Nations Environment Programme – Finance Initiative (UNEP-FI) (signed by Daiwa Securities Group Inc. in May 2018)
Task Force on Climate-related Financial Disclosures (TCFD) (Daiwa Securities Group Inc. announced its support in April 2018)
30% Club Japan (the Board of Directors and President and CEO of Daiwa Securities Group Inc. started to participate as members in
May 2019)
Click here for details
80SDGs report 2020

Workforce Statistics
Daiwa Securities Group (Consolidated)
Number of employees(Unit: persons)
As of March 31, 2019

Employees
Japan

As of March 31, 2020
Temporaryemployees

FA*1

Employees

Temporaryemployees

FA*1

Male

8,092

47

-

8,025

42

-

(Careertrack*2)

7,638

-

-

7,499

-

-

(Managers)

4,158

-

-

4,177

-

-

Female

5,210

43

-

5,347

38

-

(Careertrack*2)

3,616

-

-

3,741

-

-

(Managers)

490

-

-

562

-

-

Japan total

13,30290806

13,37280

535

Overseas

1,804

-

109

1,868

-

112

Total

15,10690915

15,24080635*1. Financial advisors*2. Includes employees in broad regional career-track positions (with job transfers involving relocation within a certain area) and in regional careertrack positions (without job transfers involving relocation), and specialists

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SDGs report 2020

Number of New Graduates Recruited

Daiwa Securities Group appoints talented human resources regardless of gender.
The Group conducts recruiting activities with the goal of stably maintaining the ratio of women among new graduates recruited at 50%
in each scal year until FY .
Career-track
employees,
regional careertrack
employees, etc.

April 2016

April 2017

April 2018

April 2019

April 2020

Male

332

345

289

337

244

Female

330

333

289

340

216

Ratio of women

49.8％

49.1％

50.0％

50.2％

46.9％

* This data covers eight Group companies.

Daiwa Securities (unconsolidated)
Number of Employees(Unit: persons)
FY

Japan

FY

FY

FY

FY

Male

5,028

5,128

5,216

5,204

5,144

Female

3,491

3,657

3,824

3,975

4,032

Total

8,519

8,785

9,040

9,179

9,176

Number of New Graduates Recruited
April 2016

April 2017

April 2018

April 2019

April 2020

Male

271

275

219

262

169

Female

287

290

229

263

142

Ratio of women

51.4％

51.3％

51.1％

50.1％

45.7%

* This data covers career-track and regional career-track employees

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SDGs report 2020

Average Age
FY

FY

FY

FY

FY

Average age (as awhole)

37.9

38.0

38.0

38.3

38.4

Average age (male)

39.5

39.6

39.6

39.8

39.7

Average age (female)

35.6

35.7

35.7

36.2

36.6

* This data covers Daiwa Securities

Average Number of Years of Service
FY

FY

FY

FY

FY

Average number ofyears of service (as awhole)

13.5

13.6

13.7

13.8

13.9

Average number ofyears of service (male)

15.1

15.2

15.3

15.4

15.5

Average number ofyears of service(female)

11.3

11.4

11.4

11.5

11.8

* This data covers Daiwa Securities

Working Hours and Paid Vacation Usage Rate
FY

FY

FY

FY

FY

Annual regular
working hours (hours)

1837.51837.51837.51837.51837.5

Average monthly
overtime hours(hours)*1

24.0

23.5

23.2

22.8

21.7

Paid vacation usage
rate(Average number ofdays taken)

63％（13.4）

66％（14.0）

68％（14.2）

68％（14.3）

72%（16.0）* This data covers Daiwa Securities*1. Figures for employees who are members of Daiwa Securities Group Employees’ Union
83

SDGs report 2020

Hiring Initiatives
Hiring Approaches and Trends
Daiwa Securities Group wants all our employees to work with a high level of loyalty and motivation. All new college graduates recruitedby the Group, including those with disabilities, are brought on as full and regular employees so that newly hired employees will be able
to have a sense of trust and pride in the Group, and a sense of solidarity with their colleagues. We are making e orts to provide anenvironment where a diverse range of people can perform to their full potential.
We also focus on attracting people capable of excelling globally in order to develop a global network and strengthen alliancestrategies.
Daiwa Securities Group o ers internship programs to provide opportunities for gaining rsthand experience in the securities businessthrough interaction with employees.

Fairness in Hiring
Daiwa Securities Group has formulated and announced its Guidelines for Fair Hiring, comprising three fundamental principles for
ensuring fair hiring practices.

Guidelines for Fair Hiring
1. Utmost respect for the rights of the applicants
2. Eligibility for all individuals who meet the hiring criteria
3. Making all hiring decisions based on a fair and objective evaluation of the applicants’ ability, aptitude and motivation

Recruitment of University Graduates
In FY , we began hiring recent university graduates who had obtained their diploma within the preceding three years with orwithout any work experience during the period as part of our e orts to build a diverse workforce. These recruits receive the same
training as new graduates.
Click here to see Number of new employees for FY* Daiwa Securities Group Inc., Daiwa Securities Co. Ltd., Daiwa Asset Management Co. Ltd., Daiwa Institute of Research Ltd., Daiwa Institute of ResearchBusiness Innovation Ltd., Daiwa SB Investments Ltd., and Daiwa Corporate Investment Co., Ltd

Number of new employees for FY

460 people (5 group companies*）
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SDGs report 2020

Divercity and Inclusion
Encouraging Women to Succeed

Daiwa Securities Group proactively appoints talented human resources regardless of gender. We are trying to appeal more to women’s
individual interests by introducing thriving female employees as role models in internal publications in order to increase the number ofwomen in managerial positions. A career consultation service has been set up on the Group’s internal WLB promotion website. Female
executives as well as heads of each department, o ce, and branch give advice on the concerns and inquiries of female employees.
In 2015, the current Chairman of the Board of Daiwa Securities Group Inc. showed his support for the “Declaration on Action” by agroup of male leaders who will create “A Society in which Women Shine” spearheaded by Japan’s Gender Equality Bureau Cabinet
O ce.
See also Work-Life Balance for more information on promoting women's activities.

Targets Related to Initiatives for Empowering Women

Daiwa Securities Group has a proven track record of implementing a wide range of initiatives that help female employees reach theirfull potential. At Daiwa Securities, we have set speci c targets for the years through FY . In this manner, positive steps are being
taken to provide an environment in which employees with diverse values can maximize their capabilities.

Targets for Years through FY(Daiwa Securities)

Ratio of women in managerial positions: At least 15%, a more than vefold increase from the FY
Ratio of women in new graduates recruited: 50% (stable)
Ratio of women among participants in training: 50%
Rate of taking annual leave: At least 70%
Rate of taking childcare leave for male employees: 100%level

Support for Female Employees’ Career Advancement
By increasing the number of role models, we are making it easier for the Group’s female sta to envision their career
path. In this context, there has been a sharp increase in female employees aspiring to advance their careers by switching
to career-track and regional career-track positions in recent years.
To date, more than 1,400 female employees have converted to career-track positions. An increasing number of
employees have also taken advantage of our Professional Return Plan, a system for re-hiring employees who left work toraise children or care for family members, starting them at the same level of compensation as when they left. The scopeof this system was expanded in FY . This has helped us to secure talented personnel who support business
operations. The number of female employees right before being promoted to managerial positions is 2,225 at the end ofJune 2020, substantially increasing from 1,093 in 2005.
We also launched a career support training initiative for female employees (Daiwa Woman’s Forum) in FY , and a
program for women in managerial positions (Daiwa Woman’s Management Forum) in 2018. These programs havecontributed to building networks among women.

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SDGs report 2020

Appointment of Female Executives and Women in Managerial Positions
Daiwa Securities Group has a total of nine women in top managerial positions who work as directors, corporate executiveo cers, and executive o cers. They include three female executives serving as directors and corporate executive o cersat Daiwa Securities Group Inc. The number of women in managerial positions is increasing year by year, with the Group’s
total number standing at 666 as of the end of June 2020. The ratio of women in managerial positions has risen from 2.2%
at the end of FY to 13.2% on a group-wide basis (up from 2.3% to 15.9% at Daiwa Securities).

Becoming a Member of 30% Club Japan
Daiwa Securities Group Inc. supports activities undertaken by the 30% Club Japan, with its Chairman of the Board andPresident and CEO participating as members. The organization, launched in Japan in May 2019, aims to increase the ratioof women in top management of Japanese companies. It has set the goal of raising the ratio of women in the Boards of
Directors at the TOPIX 100 companies to 30% by 2030. Chairman of the Board of Daiwa Securities Group Inc., Takashi
Hibino, participates as a steering committee member. We will accelerate our initiatives to produce female leaders whowill lead Japan’s nancial industry.

Support for the Success of Veteran Employees

Daiwa Securities Group has in place a Senior Advisor System that enables veteran employees with a wealth of experience to play anactive role in the workplace. Senior advisors are dispatched to locations of their choice and engage in community-based consulting
and sales from a long-term perspective.
Highly-motivated and talented employees can continue working after retirement under our Daiwa Master System. In FY , westarted allowing senior advisors to continue working regardless of their age. A total of 110 employees used this system in FY .
In accordance with the e ectuation of revisions to the Act on Stabilization of Employment of Elderly Persons in 2013, and as the careersof employees are lengthening, we associate our sustainable growth as a company with the employment of older people who wish to
keep learning and working in a meaningful way as a part of the organization. Daiwa Securities is greatly expanding its training
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SDGs report 2020

programs for employees aged 45 and older, and has introduced the License Certi cation System that provides incentives to employees
who have improved their skills and polished their acumen as professionals. Over the four years since these programs were introduced,
approximately 1,800 employees, 60% of employees aged 45 and older, have participated in the more than 20,000 seminars o ered bythese programs. In addition, we introduced a Superior Managing Director System as the highest employee position and enhanced thepersonnel system for veteran employees with outstanding expertise and knowledge who have made remarkable achievements. We
support both work and caregiving, and are creating an environment in which employees can move forward enthusiastically without
concerns over their future lifestyle.
We have also introduced long service leave for employees in their th year and th year at the Group. The leave is designed withgratitude to provide employees who have contributed greatly to the Group’s development with an opportunity to refresh themselves
and spend time with their parents, spouse, and other people around them who always support them.

Employment of People with Disabilities

As of FY , Daiwa Securities Group had more than 200 employees with disabilities handling a wide range of responsibilities in ourhead o ce, sales branches and contact centers. We started recruiting new graduates with disabilities as regular employees (generalo ce sta ) in FY , and in FY broadened the scheme to career-track employees, regional career-track employees, and customer
service employees. Once people with disabilities are hired, we provide support for their career advancement by, for example, creating
opportunities for them to enter the career-track and regional career-track employment opportunities. To further strengthen our
support to employees, we also introduced the Daiwa LEAP Plan in 2018. This provides comprehensive support including a leave
program for outpatient treatment, subsidies for expenses incurred to start work, and the introduction of support tools according to thetype of disability. The Plan is a measure for bringing out employees’ talents while taking their respective circumstances into
consideration, and developing a pleasant working environment.
We have vigorously increased recruitment opportunities by holding brie ngs about the company for new graduates, participating incareer expos, and implementing job placement support programs for university students with disabilities.
Moreover, Daiwa Securities Group participates in the Accessibility Consortium of Enterprises (ACE), a general incorporated association,
as a member. ACE was founded for the purpose of establishing a model for people with disabilities that contributes to corporate
growth, and communicating information to society concerning human resources sought by businesses. As of October 2020, ACE has 37
corporate members, mostly large companies. Through the holding of seminars and workshops for human resources personnel andemployees with disabilities, as well as issuance of educational brochures, ACE carries out awareness-raising activities for parties
concerned, creates role models, and makes proposals to management and society. Our Group's "Daiwa LEAP Plan" initiative received a"Special Award" in the "Environment Creation Category" of the 2020 ACE Awards.

Employment Rate for Persons with Disabilities
FY

2.10％

FY

2.33％

FY

2.57％

Promoting Increased Understanding toward the LGBT Community and
Related Issues

As an opportunity to deepen understanding of LGBT issues, LGBT themes are taken up in training for new and young employees, aswell as in training for those who have been promoted. A cumulative total of approximately 5,000 have participated in this training todate.
In addition, every year we hold a Human Rights Awareness Workshop for all employees in each department and o ce, which includes
video training and discussion to promote understanding of LGBT issues. In addition, the Group’s Compliance and Human Resources
departments receive training from the NPO Nijiiro Diversity to deepen their understanding of the fundamentals and case studies ofother companies in order to create a comfortable work environment. Our Human Resources Department supports employees who areundergoing gender transition by allowing them to take time o . E orts are also made to promote increased understanding amongsurrounding employees.
87SDGs report 2020

Human Resource Development and Skill Enhancement
Employee Training Approaches and Trends
The source of Daiwa Securities Group’s competitiveness lies in the capabilities of its employees. The Group focuses on thedevelopment of human resources who can provide high value-added solutions through the use of our “Quality No. 1” integrity andspecialized skills.
In particular, we o er extensive training programs to newly hired employees, as we believe that this is a critical period for theirtraining. Seeking to achieve the “Quality No. 1” in the industry, we adopt a system that allows employees to re ne their knowledge,
techniques, and mindsets through a variety of programs in the curriculum. It enables us to nurture human resources with professional
skills at an early stage.
We believe that our employees must have a rm understanding of corporate ethics and compliance to ensure the development ofsound nancial and capital markets. Accordingly, we provide all employees with regular training on information security andcompliance. We also believe that not only having a strong commitment to compliance but also maintaining a high sense of morality
and making decisions in light of general social norms is important for living up to the trust of customers and society. Based on thisbelief, we hold monthly discussions, using a case study approach, for young employees within the rst ve years of employment, withthe participation of senior employees.

Education and Training System
Daiwa Securities Group seeks to be a group of true professionals who love their jobs
and keep aiming high. Our employees not only acquire skills necessary for theircurrent work assignments but also make consistent e orts toward achieving theircareer visions. We have adopted an educational system comprising mandatory
programs clearly positioned as duties that must be worked on, and a variety ofoptional programs that can be chosen according to the needs of each employee for
their career advancement. In this way, we support the autonomous careerformation of each employee. We also aim to foster a sense of solidarity among
Group employees across divisions while o ering training opportunities at groupmeetings.

Daiwa Securities Group’s Education System

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SDGs report 2020

Training Records in FY
Number of times skill training
was held in FY :29 training courses held 57 times

Number of participants

4,126 people

Cumulative number ofparticipants (FY -FY

17,853 people)

Cost for the Group’s educational
investment:¥2.2 billion

Cost per employee¥160,000

Training for Young Employees
Daiwa Securities Group views the rst two years of an employee's career as a period for their basic training for becoming
a professional. Accordingly, we implement the Daiwa Basic Program that covers this period of training. The program sets
the items and levels that should be acquired, and organically combines group training, OJT, e-learning, and support for
the acquisition of quali cations. Moreover, since FY , we have been providing an educational program called “QRoad” for employees in their third to fth year of employment. This program helps to improve their knowledge,
techniques, and mindsets to achieve “Quality No. ” in the industry. It presents high-level goals to further promote
employees’ growth.
Skill Training
We provide twice-a-year skills training aimed at enhancing the skills and techniques that employees themselves want toimprove as an opportunity for them to acquire various skills and special knowledge. We enhanced our e-learning
program from FY , while introducing two-way online training this scal year. We have thus developed a training
system that can better satisfy employees’ motivation for self-development. For example, in the inheritance and businesssuccession master course, which is provided by a practicing tax accountant, employees learn basic knowledge of laws
and systems and then generate output through case studies to acquire practical skills. The course helps the participants
to acquire skills and special knowledge for conducting a high-quality solutions business, as many of them state that it
was useful for understanding customers’ issues and needs and providing solutions to address them. In addition, a wide
range of training programs on coaching, PC skills and other topics have been made available so that employees canchoose programs according to the career they aim for, regardless of their a liated department and duties.
Training for Veteran Employees
We have been providing the Advanced Skill-building Program, a training program for employees aged 45 and older that isdesigned to continuously improve skills. We have also introduced a license certi cation system that provides incentives
to employees who continue to work to improve their skills. Since its introduction, approximately 1,800 employees,
accounting for more than 60% of personnel aged 45 and older, have undertaken over 20,000 training programs.
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SDGs report 2020

Supporting Employees Trying to Earn Credentials
Daiwa Securities sees Financial Planner (AFP and CFP®) and Securities Analyst quali cations as core requirements, and encourages
employees to acquire these certi cations. As a result, the number of employees with CFP® certi cations has exceeded 1,000 for the rst
time for a company/organization in Japan, making it the highest level in the industry. CFP® is a high-level credential certifying
knowledge and skills in the tax system, inheritance, and real estate elds needed for providing nancial planning services. Moreover, asa result of the introduction of the Daiwa Basic Program, an educational training program covering the rst two years of employment,
nearly all employees in their second year of employment acquire AFP, while 70% have passed the Certi ed Member Analyst of the
Securities Analysts Association of Japan (CMA) examination (Level 1).
We have also introduced an Inheritance Planner Certi cation® as an in-house quali cation system. The certi cation is granted to
employees who have completed practical training, based on extensive knowledge obtained through the acquisition of CFP®
certi cation, and can be used for business worksites. In addition, the company provides generous support by, for example, subsidizing
certi cation costs so that employees can enhance their specialized skills and become professionals.

Number of Persons Earning Major Credentials (as of March 31, 2020)
Number of persons earning CFP®
certi cations:

1,020 people

Number of Certi ed Member Analyst of the
Securities Analysts Association of Japan(CMA)®:

1,470 people

Intra-Group Job Postings and the Career Track Change System
We have instituted a Career Track Change System that enables non-career-track employees to transfer to career-track and regional
career-track positions. Under the system, more than 1,300 employees have moved to other positions. We have also instituted a system
of intragroup job postings to help employees with skills and the desire to realize their potential to open new career paths.

Evaluation System
To ensure that all employees can continue working with a high level of motivation, it is important to have a fair and convincing
evaluation system. For this reason, Daiwa Securities Group has implemented a multifaceted evaluation system for managers whereby
subordinates conduct evaluation. This involves subordinates assessing each manager’s job performance in carrying out daily duties
and the results being fed back to the manager. The scheme aims to help managers to identify their challenges and improve their
managerial skills through training programs and other means, thereby improving our overall productivity. The multifaceted evaluation
system covers all managers, including executives, the heads of departments, o ces, and sales branches, and section chiefs.
We also evaluate employees comprehensively by taking their compliance-related performance into account. In addition, we endeavor
to create a personnel evaluation system that motivates all employees, regardless of years they are with us, whether they are young,middle of career, or experienced veterans, to take on the challenges of the next stage of their careers and to work in positions withgreater responsibilities. Even while on childcare leave, employees are still eligible for promotions as we properly evaluate theircontributions to date.
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SDGs report 2020

Work-Life Balance

Support for women's advancement and work-life balance
Daiwa Securities Group is working to create an environment in which all employees, men and women, from young toexperienced, can continue to work with a high level of motivation.
One of the Group's Corporate Principles is "placing importance on personnel" and the corresponding text is "The source of
the Group's competitiveness lies in the capabilities of its employees. The Group will promote the creativity of employees byo ering them a challenging and self-directed working environment that encourages their abilities and appropriately
rewards their contributions." We believe that maximizing the motivation of each and every employee will lead to higher
customer satisfaction and ultimately higher shareholder value. We are implementing various measures with the aim of
becoming a Group in which employees feel that their work is rewarding, and feel even more proud to be a member of theGroup, extending to their families and related parties. In 2020, we formulated the No. 1 in Job Satisfaction Plan 2020. We areworking to establish an environment that enables all employees to work e ciently in the limited time available and todemonstrate their full potential.
* WLB: Abbreviation for work-life balance.

Daiwa Securities Group's approach to supporting women's
advancement

One of the Daiwa Securities Group's Corporate Principles is "Placing importance on personnel," and its management strategy states,"The Daiwa Securities Group is working to create an environment in which all employees, men and women, from young toexperienced, can continue to work with a high level of motivation."
Regarding support for women's advancement, in order to produce female leaders who will drive the Japanese nancial world, we will
actively promote female employees and create an environment where they can continue to work actively even after life events such as
marriage and childbirth. We will support the e orts of companies by publicizing the status of support for women's advancement in theGroup.
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SDGs report 2020

In 2009, four female directors were appointed concurrently. To incorporate more diverse perspectives into our Group management, wehave appointed three female directors at Daiwa Securities Group Inc. and nine female directors, o cers, and executive o cers
throughout the Group. Daiwa Securities Group Inc. has endorsed the 30% Club Japan activity launched in Japan in May 2019, in which
Chairman of the Board and the President/CEO participate as members. 30% Club Japan aims to increase the percentage of women on
the board of directors of TOPIX 100 to 30% by 2030, and aims to increase the percentage of women in the top ranks of Japanesecompanies.
There are about 20% of branch managers and two overseas base managers (as of June 2020), demonstrating increasing advancementof women. As the number of role models increases, it becomes easier for women to plan their careers, and in recent years, the numberof female employees who are aiming to improve their careers through a shift to career-track and regional career-track positions has
signi cantly increased.
Furthermore, we support various systems and measures that exceed legal requirements so that employees can continue to work
actively even after undergoing life events such as marriage and childbirth.
We are striving to create the ideal work environment where each employee feels that theirwork is rewarding and a source of joy, and can challenge themselves to maximize theirpotential. Going forward, we will continue to improve the work environment for all
employees, both men and women, young and experienced, so that they can fully
demonstrate their abilities and feel even more rewarded by their work.
Kana Shirakawa, Executive
Managing Director
Head of Human Resources andChief Health O cer (CHO)
Daiwa Securities Group Inc.

Various systems
Childcare leave
Childcare Support Leave
Pre-childcare leave formale employees
Short working hours
systemExemption/restriction on
overtime work
Nursing care leave
Daycare subsidy
Babysitter system

Can be taken up to the day before the child reaches the age of three
Can be taken when the spouse gives birth or returns to work (within the rst two weeks ofchild care temporary retirement when treatment is guaranteed). Since its introduction in
September 2014, it has been used by a cumulative total of 1,400 people. As a general rule, ittakes a minimum of one week.
Can be taken when the employee accompanies the spouse to a pregnancy checkup andparticipates in a parents’ class, as well as for preparations for hospitalization, etc. before thebirth. The leave is designed to nurture an awareness of participation in child rearing among
male employees before the birth of a child.
A system that allows employees to leave the company up to 90 minutes early until theirchildren graduate from elementary school
Exemption from overtime work is possible until the employee's children complete the third
grade of elementary school. Overtime work can be limited until graduation from elementary
schoolUp to 5 days per child before elementary school, up to 10 days per year if the employee has 2
or more children (can take in half-day units)
The Group subsidizes the cost of child care facilities or after-school care until the employee's
children reach the third grade of elementary school
Employees can use a babysitting service contracted by the company at a special rate until
their children complete the third grade of elementary school92

SDGs report 2020

Support desk for
employees looking fornursery schools
Job location changesystemSpouse work
reassignment leavesystemBirth gift of 2 million yen
from the third childNursing care leave
Nursing care time
Nursing care-support
leave
Nursing Care Travel
Home Expense
Allowance
Life Support Paid Leave
Work-Life Balancephoneline
Professional Return Plan
(re-hiring of sales sta )Expanded leave system
The telecommuting
systemDaiwa ELLE Plan

O ers free-of-charge services that check information on nursery school facilities, the statusof availability, and other such matters on behalf of employees, thereby assisting them to ndnursery schools
If an employee needs to relocate due to marriage, spouse job transfer, nursing care timecare, etc., the Group will provide a work position at the new location. Since scal 2007,
approximately 300 people have used this system
Employees can take up to 5 years of leave if their spouse is transferred overseas
The Group pays 2 million yen as congratulations for the birth of the third and subsequent
childrenEmployees can take up to four periods of nursing care leave within 3 years (1095 days) for
each family member requiring care
Employees can take up to 2 hours per day of family care time within 3 years from the start ofuse
Employees can take leave to take care of family members who need nursing care, to attend
hospital, etc. or to carry out procedures on behalf of family members. Up to 5 days per year
can be taken (half days can also be taken, 10 days for 2 or more family members).
The Group subsidizes travel expenses incurred when employees return to their parents’home to provide nursing care.
Employees can take paid vacation when it is required for injury/illness, nursing care
preparation, fertility treatment, or nursing a child (up to 50 days)
The Work-Life Balance phone line provides various types of advice to employees regardingbalancing work and child care/ nursing care, career planning, etc.
A system to re-employ employees who have retired due to marriage, childbirth, or nursing
care, etc. with the same treatment as when they retired
Used by about 70 people in total
The Group has de ned marriage preparation vacation; kids' ceremony vacation (forchildren's entrance ceremonies, etc.); family day vacation (to deepen family friendships);
parents'longevity vacation (to coincide with longevity celebrations for own or spouse's
parents); and volunteer vacation, and encourages employees to take paid vacation
Work-from-home is possible in all departments including sales to balance work with nursing
care, cancer treatment, and infertility treatment
Regarding health issues for women who are active at various life stages, the Group provides
comprehensive support including measures for the menopause; ELLE vacations (for poor
physical condition during menstruation/menopause and fertility treatment); improvement ofliteracy such as e-learning training for managers; subsidies for speci c fertility treatments;
and a work-at-home system to balance work and fertility treatment

The Group continues to educate its employees through various training sessions according to position regarding the initiatives andobjectives of "supporting women's advancement" and "promoting work-life balance" as management strategies. Furthermore, theGroup conducts training on its work-life balance support system for balancing work with child care and nursing care responsibilities
based on the idea that it is important to deepen mutual understanding not only for employees who use the system, but also for theemployees who work alongside them.
In addition, once a year, we conduct a survey for all employees about work-life balance and balancing work with child care and nursing
93

SDGs report 2020

care responsibilities. We survey the recognition, degree of use, and issues of our systems, while soliciting opinions and requests from
employees, to promote further understanding and enhance penetration of the systems. Based on employee feedback, we also review
the design and operation of these systems.

Various measures
Supporting career advancement among female employees
To help female employees move closer to their ideal future image while going through various life events, the Group
implements a career support training initiative for female employees named Daiwa Woman’s Forum. The initiative
provides an opportunity to make it easier for female employees to picture their future work style and career image. Every
year, 100 to 200 female employees who are one step before a managerial position participate across divisions anddepartments. In addition to career plan training and skill training, the curriculum incorporates interaction with rolemodels such as female directors and female managers. The program thus contributes to building networks among
women.
In addition, based on the experience to date, the Group holds a training event for female managers, "Daiwa Woman's
Management Forum," to further improve the future image that each person envisions.
Against the backdrop of extended working lives amid the shift toward people living to 100 years old, in FY , weexpanded the range of career choices to include “regional career-track” (positions that do not involve relocations). We
have also established a new “broad regional career-track” system that allows employees to be relocated within a certain
area, seeking to enable sta to continue to play active roles and remain strongly motivated.

Various skill training
For the purpose of fostering true professionals, the Group provides various skill training sessions that are opportunities
for employees to acquire various skills and specialized knowledge. We are making e orts with the goal of setting the ratioof female participants to 50% by FY (46% in FY ).
Job shift system
With regard to job shifts, up to now more than 1,400 people have shifted to career-track or broad area career-track thatcan be relocated within a certain period of time or area career-track that does not involve relocation, and the number offemale employees active in a wide range of jobs has increased signi cantly.
As the number of role models has increased, the number of female employees who are aiming to improve their careers byshifting their job has greatly increased.

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SDGs report 2020

Work-Life Balance Committee
In 2017, Chairman of the Board Takashi Hibino and the President and CEO Seiji Nakata were appointed co-chairpersons
the Work-Life Balance Committee, which is launched to promote women's activities and dramatically improve
productivity under stronger leadership. Sta from various positions and departments, from executives and managers toyoung employees, participate as advisors to discuss and verify the status of various measures, including e orts to achievegoals for the promotion of women's activities, support for balancing work with childcare and nursing care, leaving work
before 19:00, planned annual leave taking, and male employees taking childcare leave.
Women's Advancement Promotion Team Regular Meetings
Meetings of the Women's Advancement Promotion Team are held regularly. The meetings provide an opportunity forinteraction as female employees and executives such as female directors and female department managers exchange
opinions about careers.
Round-table discussions
Round-table discussions are held among female employees, and group discussions are conducted covering concerns andissues regarding their continuing work. The participants present the contents of the discussions to management andexpress their opinions and ideas.
System Usage Calendar
The Group introduced a "System Usage Calendar" that allows all employees in the department to share their plans forusing annual leave, continuous leave, and the systems for balancing work with child care (short working hours system,etc.). It is extremely e ective in promoting annual leave for all employees, and has become a system that allows each
workplace to use the leave systems smoothly.
Distribution of Career Design Books
To support the career design of each and every employee, the Group posts “Career Design Books” on the internal portal
site, making them available to all employees. These books compile information on a variety of career paths andpositions, various personnel systems and education/training programs, and welfare and other systems.
Return to work guideline
The Group has established guidelines for department managers so that employees can take child care leave and return towork smoothly. These guidelines encourage appropriate consideration to make it easy for employees to use the system
according to their physical condition and individual circumstances. They also promote understanding among other
employees, and describe how to distribute work according to the situation and how to provide training as a role model.
They go on to describe how to give fair and impartial evaluations and feedback to employees with various circumstances,such as those who will use the system and those who have returned to work. Through training and other measuresmanagers can remain informed and educated.
In addition, the Group has distributed a list of the various work-life balance systems to managers as "Work-life balancesystems for balancing work and child care/nursing care that managers need to know about."95

SDGs report 2020

Education for managers
Top management continually communicates about the Group's work-life balance e orts including women's
advancement and their purpose at meetings where all executives and all department managers gather, and the Group is
promoting training for managers including all line section managers. By deepening their understanding of the initiatives
for promoting the careers of women, their purpose, and the work-life balance support systems, managers themselves areworking to create an "environment in which all employees can continue to work actively."
Furthermore, for the purpose of improving management ability and the productivity of the entire Group, subordinate
employees and related departments evaluate the work and behavior of managers in their daily work, and the results are
fed back to the individual. In this way, a " -degree evaluation" is conducted for all management including executives,
department managers, and section managers. As part of these evaluations, the status of diversity e orts is also
evaluated, and the results are incorporated into the manager's evaluation.
Self-reporting system
The Group has implemented a "self-reporting system" as an opportunity for managers to think about their future goals
and career development. Managers share their hopes and goals with their superiors and interviews are held to support
their career advancement as managers.
Career Consulting Salon
The Group set up a "Career Consulting Salon" on the work-life balance promotion site (inside the Daiwa WLB station) for
employees only, and female executives and female department managers act as "career advisors" to discuss career paths
and work-life balance with junior employees across divisions and departments.
Expanded support for balancing work and nursing care
The Group is helping employees balance their work and nursing care in various ways. To further improve theenvironment in which employees with abundant experience and a high degree of specialization can continue to work
actively without feeling anxious about future nursing care, the Group established a nursing care leave system thatexceeds the legal requirements (up to 1095 days, can be acquired in four periods) and introduced a work-from-homesystem for all departments including sales departments. Further, following consultations with employees who areproviding nursing care and their families, the Group introduced a Nursing Care Concierge Service that can provide various
solutions. Moreover, in conjunction with "Nursing Care Day" on November th, the Group held study sessions at all
branches entitled "Responding to an Aging Society and Balancing Work and Family Care," to raise employee awarenessand foster a corporate culture that makes it easy to use the systems.

Trend in Number of women in managerial positions

Since the establishment of the "Women's Advancement Promotion Team" in 2005, the Group has continued to make various e orts
with the aim of supporting women's advancement and realizing "work-life balance" for employees, while establishing various support
systems for work-life balance that exceed legal requirements. As a result of our e orts so far, the number of female managers has vefold compared to before the introduction of the measures.
The Group operates a fair treatment and evaluation system that encourages all employees, from young people, mid-level employees,
and experienced employees, regardless of their years of employment, to work hard at a higher stage and in a position of greater
responsibility. Also, based on the belief that promoting appointments based on fair evaluations and creating an environment in which
diverse human resources can maximize their abilities will lead to an increase in corporate value, even during child care leave,96

SDGs report 2020

employees are evaluated correctly based on their achievements up to that point and are eligible for promotion. The Group has createdan environment in which employees can aim for career advancement even as they experience life events.
As a result of various e orts, the number of role models has increased, and the number of female employees in positions just below
management positions has doubled since 2005.
Furthermore, the Group is appointing future candidates for executives regardless of gender at an early stage, and is working to develop
candidates for management executive positions through selective management training.

Daiwa Securities Group
Number of
women inmanagerial
positions(Consolidated)
Ratio of female
managers

2006
As of March 31
97

2016
As of March 31
316

2017
As of March 31
375

2018
As of March 31
424

2.7％

7.5％

8.8％

9.4％

2019
2020
As of March 31 As of March 31
490
562

10.5％

11.9％

Daiwa Securities Co. Ltd.

In terms of the ratio of female managers, the Group is continuing various initiatives with the goal of increasing the ratio to 15% or moreby 2020, which is more than ve times the level in scal 2005 when the Group began its concerted e orts for women's advancement.
The ratio of women who have a position at or above the level of manager is 9.7% (45/462), and the ratio of women at the level ofsection manager is 13.9% (401/2,881) (as of March 31, 2020).

Number of
women inmanagerial
positions(Consolidated)
Ratio of female
managers

2006
As of March 31
77

2016
As of March 31
239

2017
As of March 31
295

2018
As of March 31
329

2.8％

9.8％

10.6％

11.6％

2019
2020
As of March 31 As of March 31
378
432

12.9％

14.5％

* Deputy managers and above are counted as managers

Number of new
female managers(Daiwa Securities)
Ratio of womenamong new managers

FY

45
27.1％

FY

62
32.3％

97

FY

40
24.4％

FY

61
26.2％

FY

64
26.8％

SDGs report 2020

Child care/nursing care-related

With the goal of supporting the spouse's child care and smooth return to work, and supporting the further advancement of women, theGroup is advancing e orts to achieve a 100% rate for men taking child care leave by 2020.

○Trend in the number of employees taking child care leave
Female
Male
Total

FY

640
250
890

FY

FY

671
327
998

FY

695
437
1,132

696
420
1,116

FY

680
378
1,058

○Trend in the number of employees taking nursing care leave
Female
Male

FY

4
2

FY

FY

0
2

FY

2
3

5
3

FY

10
3

○Other data
Childcare leave
usage rate

FemaleMale
Return rate
Femalefrom child care
Male
leave
Employment rate when a female
employee's child is 1 year old
Short working hours system users
Daycare subsidy users
Birth gifts for third child

FY

100.0％
73.1％
92.5％
100.0％
100.0％

FY

100.0％
96.8％
91.5％
100.0％
100.0％

249
505
33

324
625
31

Promotion of WLB

FY100.0％
100.0％
89.5％
100.0％
100.0％
373
702
54

FY

100.0％
100.0％
91.4％
100.0％
100.0％
446
759
45

FY

100.0％
100.0％
91.9％
99.0％
100.0％
505
583
28

With the goal of "realizing a high degree of work-life balance", the Group is making e orts to promote work-life balance, aiming topursue work styles in which work and life are in harmony, and to enhance the work environment where both men and women canwork in various ways.
The Work-Life Balance Committee, which is chaired by the Chairman of the Board and the President and CEO, is held every quarter,and under strong leadership, o cers and employees working in various positions at various departments, from executives anddepartment managers to young employees, participate in a wide range of discussions on various measures such as work-life balanceand promotion of women's advancement. The Group has also set up a Work-Life Balance Promotion O ce in the Human Resources
Department to plan, make proposals, and promote work-life balance and support for women's advancement. In addition, the Group
has set up a Women's Advancement Promotion Team, in which women from each division participate in a cross-divisional manner andmake suggestions for improvements to support women's advancement. The Work-Life Balance Committee, the Work-Life Balance98SDGs report 2020

Promotion O ce, and the Women's Advancement Promotion Team are working together to implement various measures, and holdregular cross-Group women's advancement promotion meetings in order to progress e orts across the Group.
Expanding the Telecommuting System
In March 2020, the Group expanded the telecommuting system, including working from home, in order to realize various
work styles according to a variety of life stages and improve the productivity of the company as a whole.
We distributed a two-in-one terminals to all employees, introducing a full-scale teleworking system for all employees.
This has enabled us to work in the same environment as going to the o ce, even during the current COVID- , helping toprotect the safety of employees and their families.
Implementation Smart Biz year-round
Since April 2020, the Group has been implementing the "Smart Biz (Work Without a Tie)" program as a year-roundinitiative even outside the "Cool Biz" period. The initiative is aimed at further promoting innovative ideas through theinvigoration of workplace communication and physical and mental refreshment.
Enforcement of leaving the o ce before 7 p.m.
Since 2007, the Group started to encourage employees to leave the o ce before 7 p.m., with the goal of achieving a 100%
implementation rate in all divisions. In this way we are promoting the e cient work of employees within a limited time.
Furthermore, the Group has developed guidelines for work and meetings where multiple departments collaborate. The
Work-Life Balance Committee regularly veri es the implementation status of leaving the company before 7 p.m.
Since 2015, the Group has been expanding investment in human resource development by capitalizing on the results ofproductivity improvements. In addition, in 2017 and 2018, the Group provided a "special allowance for work-life balance
and work style reform," and in 2019 provided a "special allowance for productivity improvement." Lump sum payments,
funded by the results of productivity improvement, were paid to employees separately from their bonuses.
Further, the Group operates an "hourly leave system" that allows employees to take annual leave in units of one hour,which enables exible work styles. The Group has also set up a "shift work system" according to the business situation ofeach department.
Promotion of taking annual leave
The Group promotes "taking planned annual leave" for the purpose of improving productivity and work e ciency byrefreshing the mind and body and bringing out new vitality. With the goal of increasing the rate of taking annual leave to
70% by 2020, as part of its e orts, the Group introduced a System Usage Calendar and set up kids' ceremony vacations,family day vacations, parents' longevity vacations, long service thanks vacations, and marriage preparation vacations.
Family Workplace Visits
Since 2008, the Group been carrying out "Family Workplace Visits" in which we thank the families who support ouremployees every day and invite them to the workplace.
Held at head o ces nationwide, these events are popular with employees and their families. In 2019, about 6,500
families participated.

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SDGs report 2020

Daiwa WLB Station
A work-life balance promotion site exclusively for employees, which introduces the child care and nursing care systems
and features content on the subjects of self-improvement and health. It can be viewed from home while on leave, and thebulletin board is used as a communication tool for employees. In addition, the Group has set up a "Career Consulting
Salon" that utilizes the bulletin board function, and female executives and female managers give advice to junior female
employees about their concerns and questions.

Work-life balance promotion site
"Daiwa WLB Station"

Questionnaire about work-life balance
The Group regularly conducts a questionnaire on work-life balance and balancing work and child care/nursing care for all
employees, and strives to understand the usage status and requests about the systems to create an environment in which
all employees can work more comfortably.
Use of Group newsletter/Group satellite broadcastingIn every issue of the bi-monthly Group newsletter, there is a regular feature on "Everyone's Work-Life Balance OpenSpace," which introduces the Group's initiatives and systems for work-life balance, and role models that are active invarious careers. In addition, the Group facilitates the sharing of best practices in each department via Group satellite
broadcasting.

Initiative results/evaluation

External evaluations of initiatives

Results from the Group's e orts to support women's advancement and promote work-life balance have been steadily realized, and theGroup has been highly praised by many external evaluation organizations in recent years.
2006
Award for Companies That Promote Equality and Work-Life Balance Equality Promotion
Company Division "Director General of Tokyo Labour Bureau Excellence Award" (sponsor:
Ministry of Health, Labour and Welfare)Award for Companies That Promote Equality and Work-Life Balance Equality Promotion
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SDGs report 2020

2010
2011
2012
2013
2014
2015

2016

2017

2018

Company Division "Minister of Health, Labour and Welfare Excellence Award" (sponsor:
Ministry of Health, Labour and Welfare)
The rd Work-Life Balance Grand Prize "Excellence Award" in the Organizational Activity
Division (Sponsor: Japan Productivity Center)
The th "Nikkei Child Care Support Grand Prize" (sponsor: Nihon Keizai Shimbun)
The rd Diversity Management Award "Work-Life Balance Award" (sponsor: Toyo KeizaiInc.)rd overall in "BEST 100 Companies in Which Women Play an Active Role" st in Utilizationof Women category (sponsor: Nikkei WOMAN)
Award for Companies That Promote Equality and Work-Life Balance Family Friendly
Division "Director General of Tokyo Labour Bureau Excellence Award" (sponsor: Ministry of
Health, Labour and Welfare)
Career Supporting Company Award 2013 "Minister of Health, Labour and Welfare Award"(sponsor: Ministry of Health, Labour and Welfare)
Selected for "Diversity Management Companies 100 Selection" (sponsor: Ministry of
Economy, Trade and Industry)
Selected for FY "Nadeshiko Brand" (sponsor: Ministry of Economy, Trade and Industry,
Tokyo Stock Exchange)
Selected for "Health & Productivity Stock Selection" in FY (sponsor: Ministry of
Economy, Trade and Industry, Tokyo Stock Exchange)
Selected for FY "Nadeshiko Brand" (sponsor: Ministry of Economy, Trade and Industry,
Tokyo Stock Exchange)
Selected for "Health & Productivity Stock Selection" in FY (sponsor: Ministry of
Economy, Trade and Industry, Tokyo Stock Exchange)"BEST 100 Companies in Which Women Play an Active Role"st place for Promotion of Women's Advancement th place for Diversity Penetration(sponsor: Nikkei WOMAN)
Ikumen Company Award 2016 "Special Encouragement Award" (sponsor: Ministry of
Health, Labour and Welfare)th place for "Companies That Facilitate Easy Parenting 2016" (sponsor: Nikkei DUAL)
Award for Companies That Promote Equality and Work-Life Balance Family Friendly
Division "Minister of Health, Labour and Welfare Excellence Award" (sponsor: Ministry of
Health, Labour and Welfare)Award for Advanced Companies Where Women Can Shine "Minister of State for Special
Missions (Gender Equality) Award" (sponsor: Cabinet O ce)
Selected for FY "Nadeshiko Brand" (sponsor: Ministry of Economy, Trade and Industry,
Tokyo Stock Exchange)
Selected for "Health & Productivity Stock Selection" in FY (sponsor: Ministry of
Economy, Trade and Industry, Tokyo Stock Exchange)
Selected for FY "Nadeshiko Brand" (sponsor: Ministry of Economy, Trade and Industry,
Tokyo Stock Exchange)
Selected for "Health & Productivity Stock Selection" in FY (sponsor: Ministry of
Economy, Trade and Industry, Tokyo Stock Exchange)
Selected for FY "Nadeshiko Brand" (sponsor: Ministry of Economy, Trade and Industry,101

SDGs report 2020

2020

Tokyo Stock Exchange)
Selected for "Health & Productivity Stock Selection" in FY (sponsor: Ministry of
Economy, Trade and Industry, Tokyo Stock Exchange)nd place for "Companies That Facilitate Easy Parenting 2019" (sponsor: Nikkei DUAL)
Selected for FY "Nadeshiko Brand" (sponsor: Ministry of Economy, Trade and Industry,
Tokyo Stock Exchange)
Selected for "Health & Productivity Stock Selection" in FY (sponsor: Ministry of
Economy, Trade and Industry, Tokyo Stock Exchange)rd place for "Companies That Facilitate Easy Parenting 2020" (sponsor: Nikkei DUAL)

Selected for "Nadeshiko Brand" jointly sponsored by the Ministry of Economy, Trade and Industry and the Tokyo
Stock Exchange!
Daiwa Securities Group Inc. has been selected as a "Nadeshiko Brand" by the Ministry of Economy, Trade and Industry
and the Tokyo Stock Exchange for six consecutive years from scal 2014 as a listed company that excels in promoting
women's advancement.
The Group was commended for setting clear goals regarding the promotion of women's advancement and work-lifebalance and promoting an environment where personnel with diverse values can maximize their abilities.

We support the Declaration on Action by the Cabinet O ce "Group of Male Leaders Who Will Create "A Society inwhich Women Shine""
On December 18, 2015, Takashi Hibino, Chairman of the Board, endorsed the Declaration on Action of the "Group of Male
Leaders Who Will Create "A Society in which Women Shine"" which is led by the Gender Equality Bureau of the Cabinet
O ce
Under this activity, male leaders of companies actively engaged in promoting women's advancement shared a
Declaration on Action in order to maximize the abilities that women can have, and expanded the circle of support.

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SDGs report 2020

Formulated an action plan based on the Act on Promotion of Women's Participation and Advancement in the
Workplace
The Daiwa Securities Group has been making various e orts to support women's advancement, and Daiwa Securities
formulated an action plan based on the Act on Promotion of Women's Participation and Advancement in the Workplacein April 2016. Through this e ort, the Group will further accelerate the creation of an environment in which personnel
with diverse values can maximize their abilities.
[A general business owner action plan was formulated and submitted on April 1, 2016]
Daiwa Securities Action Plan [PDF: 89.6 KB][Press Release]"Setting Goals for Promoting Women's Advancement and Approval to the Cabinet O ce of "Meeting of Male Leaders to
Accelerate the Success of Women"" [PDF: 103 KB]
Since April 2005, Daiwa Securities Group Inc. has formulated an action plan based on the Act on Advancement of
Measures to Support Raising Next-Generation Children, and has been working to create a workplace environment where
employees can work comfortably while balancing their work and family life.
In recognition of this initiative, as of June 9, 2008, the Daiwa Securities Group Inc. received the "Child Care Support
Authorized Company Mark" (known as "Kurumin") from the Ministry of Health, Labour and Welfare as a "company
actively working on support for the development of the next generation" based on the Act for Measures to Support theDevelopment of the Next Generation.
Furthermore, on March 11, 2016, Daiwa Securities received the "Platinum Kurumin Certi cation" as an excellent"parenting support company" that is working at a higher standard than companies that acquired "Kurumin."[A general business owner action plan was formulated and submitted on November 1, 2015]
Daiwa Securities Action Plan [PDF: KB]

Received the symbol mark (known as "Tomonin") from the Ministry of Health, Labour and Welfare for promoting thedevelopment of a "work environment that ensures a balance of work and nursing care"!
The Group is continuously working to create a workplace environment that makes it easy to use the work-life balance
support systems so that employees can continue to work while balancing work and nursing care.
The Group received the symbol mark (known as "Tomonin") from the Ministry of Health, Labour and Welfare forpromoting the development of a "work environment that ensures a balance of work and nursing care"

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SDGs report 2020

Health Management
Daiwa Securities Group is actively working to maintain and promote the health of its employees from a business perspective.
Our e orts have been highly praised by society. For example the Ministry of Economy, Trade and Industry and the Tokyo Stock
Exchange have jointly selected Daiwa Securities Group as "Health & Productivity Stock Selection" for six consecutive years as an
excellent listed company in terms of employee health initiatives. We have also been certi ed as an "Excellent Health and Productivity
Enterprise (White 500)" for four consecutive years.
In promoting health management, we have established various KPIs, including the percentage of overweight employees, thepercentage of employees who regularly exercise, the percentage of employees seeing doctors after receiving problematic results inhealth checkups, and presenteeism. We have also set targets, which include, for example, reducing the obesity rate at age 35 by 30% by2024, and we implement a PDCA cycle.
The Group's Corporate Principles include "placing importance on personnel." Based on the idea that the source of theGroup’s competitiveness lies in the capabilities of its employees, we believe that both the wellbeing of our employees andimprovement in the company’s productivity must be achieved. We are also seeking to create an environment in which
employees feel motivated to work actively over the long term and we are working strategically to maintain and improve thehealth of our employees.
We started our initiatives to improve employees’ health in earnest in 2008, when speci c health checkups and speci ccounseling guidance were initiated at worksites, through close collaboration between the Human Resources Department,
the Health Insurance Society, and industrial as well as occupational health sta .
In 2015, to further reinforce the Group’s structure to promote health management, we appointed a Chief Health O cer(CHO) and established the Health Management Promotion Section within the Human Resources Department.
In addition, we began publishing a white paper on health and launched the CHO-sponsored Health Management
Promotion Meetings, which are held quarterly across the Group to recognize issues, evaluate e orts, make improvements,
and implement a PDCA cycle for health management.
Currently, we are implementing measures such as the "KA-RA-DA iki-iki Project" aimed at improving health awareness; the"Ganbaru Support - Cancer Working Support Plan-" to support both work and cancer treatment; the "Daiwa ELLE Plan" thatprovides comprehensive support for women's health; a health checkup plan that integrates various types of checkups, andonline health consultation by doctors.
Going forward, we will continue to work on health management at an even higher level in order to improve employee
productivity and continue to demonstrate high performance as an organization.

* "Health Management" (in Japanese) is a registered trademark of NPO Kenkokeiei
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SDGs report 2020

"Health & Productivity Stock Selection" refers to an initiative that aims to promote "health management" e orts. Listed companies
on the Tokyo Stock Exchange that practice outstanding "health management" are selected as "leading companies" and are
introduced as being attractive to investors who place importance on increasing corporate value from a long-term perspective.
"Excellent Health and Productivity Enterprise (White 500) " recognizes corporations that are practicing excellent health management
based on the health promotion e orts promoted by Nippon Kenko Kaigi (a health promotion organization) in collaboration withinsurers.

History so far
FY

FY

FY
FY
FY
FY
FY

Main achievements
Started speci c counseling guidance (metabolic
syndrome guidance)
The Human Resources Department, General
Health Development Center, and Human
Resources Department started working together
to promote health
Introduced a system for checking past healthcheckup results and various health information
onlineStarted following-up with persons with possible
medical issues with the "yellow paper" system
Started walking and quit smoking challenges
Started "Eating to 80% full" (Harahachi) campaign
Started Red Case Support Program (for severely ill
persons)

Our Group's e orts were published in the "Ministerof Health, Labour and Welfare White Paper"

105

External Evaluations

Received the Minister of Health, Labour andWelfare "Extending Healthy Life Expectancy
Award"
Selected as "Health Management & Productivity
Stock Selection"

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FY

FY

Main achievements
Started point incentive ** Points are given to self-help e orts for employee
health promotion.
When the points reach a certain level, it is re ected in
the employee's salary after age 55

Appointed Human Resources O cer of Daiwa
Securities Group Inc. to "Chief Health O cer(CHO)"
Implementation of "Promote HealthManagement Meetings"
Established "Health Management Promotion
Section" in the Human Resources Department of
Daiwa Securities Group Inc.
Issued "Daiwa Securities Group White Book on
Health"KA-RA-DA iki-iki Project Introduction
Press Release [PDF: KB]

External Evaluations
Selected as "Health & Productivity Stock Selection
2016"
Press Release [PDF: 114 KB]

Selected as "Health & Productivity Stock
Selection 2017" and "Excellent Health andProductivity Enterprise 2017 (White 500)"
Press Release [PDF: KB]
Ministry of Health, Labour and Welfarecommissioned project "Cancer Measures
Promotion Company Action"
Received the Minister of Health, Labour andWelfare Award for companies promoting cancer
controlPress Release [PDF: KB]

FYIntroduced Employment Support Plan for
Employees with Cancer
Press Release [PDF: KB]

Selected as "Health & Productivity Stock
Selection 2018" and "Excellent Health andProductivity Enterprise 2018 (White 500)"
Press Release [PDF: KB]
Received the Tokyo Metropolitan Government"Company Award for Excellent Initiatives for
Balancing Treatment of Cancer Patients andWork"
Press Release [PDF: KB]

FYIntroduced Daiwa ELLE Plan
Press Release [PDF: KB]

Selected as "Health & Productivity Stock Selection2019" and "Excellent Health and Productivity
Enterprise 2019 (White 500)"
Press Release [PDF: KB]

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FY

Main achievements
Introduced a new health checkup plan (a systemthat allows people to have a cancer checkup
together with their regular health checkup,
speci c counseling guidance using ICT, online
health consultation by a doctor)
Started health promotion measures for young
customers ( tness app, counseling guidance forpeople in their s and s)External Evaluations
Selected as "Health & Productivity Stock Selection
2020" and "Excellent Health and Productivity
Enterprise (White 500)"
Press Release [PDF: KB]

Structure to Promote
Appointment of Chief Health O cer (CHO)

In 2008, when speci c health checkups and speci c counseling guidance were started at the workplace, the Human Resources
Department, Human Resources Department, and occupational health sta began to work in earnest to strengthen employees' healthin the Group. Then, in 2015, a Chief Health O cer (CHO) was appointed to strengthen the health management promotion system, andthe Health Management Promotion Section was established within the Human Resources Department.

Held "Health Management Promotion Meetings" sponsored by CHO

In addition, the "Health Management Promotion Meetings," which are sponsored by the CHO and attended by executives from eachGroup company, are held quarterly. Occupational health sta , Heath Insurance Society, employee unions, and outside experts
participate in the meetings to verify and share health management initiatives.

Promote Health Management Meetings

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SDGs report 2020Three-Part system

In scal 2008, we established the Three-Part system throughcooperation by the Human Resources Department, the General
Health Development Center, and the Health Insurance Society
from the perspective of the company's obligation to giveconsideration to safety and promote health among insured
persons, with the aim of enhancing the viability of our healthbusiness.

Initiatives
Regular health checkup
Comprehensive medical examination
Breast cancer and cervical cancer
examinations
Employment Support Plan for Employeeswith Cancer
Daiwa ELLE Plan"yellow paper"
KA-RA-DA iki-iki Project～Healthy Lifestyle～
Smoking cessation support
Walking challenge program(point incentive)
Harahachi program to promote moderatemeal portions(point incentive)
Lectures on health literacy (point
incentive)
Disseminating information to all Group
employees

Supported by the Health Insurance Society for people aged 35 and older
For women under age 35. Supported by the Heath Insurance Society
Support for balancing work and cancer treatment
Comprehensive support for women's health
Sent to employees who have a possible medical issue following the regular healthcheckup. Promotion of medical institution consultation
A project aimed at raising the health awareness of all employees, including those
who are indi erent to health (young customers, etc.).We introduced a system
whereby employees are awarded points for taking part in health promotion events
that can be exchanged for gifts such as health-related goods, healthy beverages, anddonations to TABLE FOR TWO
Quit smoking program and quit smoking challenge where applicants take part ingroupsParticipants join a group with the goal of walking 10,000 steps a day for threemonths. Gifts are awarded by the Health Insurance Society
Participants join a group with the goal of eating to 80% full for one month
Participants learn about lifestyle diseases, exercise, nutrition and mental health toimprove their health literacy
Disseminate information from the General Health Development Center to all Group
employees via the company intranet
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Disseminating information to all Group
employees
In uenza vaccination

White Book on Health
Mental health support

Provide a wide range of knowledge on measures to combat lifestyle-relateddiseases, cancer, hay fever, infectious diseases, and women's health problems
The medical o ce provides in uenza vaccinations. The Heath Insurance Society
provides subsidies, including for family members
Issued "Daiwa Securities Group White Book on Health"Stress check, mental health consultation, mental health training

Employment Support Plan for Employees with Cancer
Since 2017, we have introduced the Employment support plan for employees with cancer, a support system for balancing
work and cancer treatment. In addition to exible working systems such as short working hours and telecommuting, we
provide nancial support and have set up a helpdesk. We are also striving to create workplaces that make it easy to workby deepening understanding of cancer patients.

Daiwa ELLE Plan
In October 2018 we introduced the "Daiwa ELLE Plan" as a comprehensive support system for women's health issues. We
provided support for women's menopause, established of ELLE leave (leave for menstrual/menopausal conditions orinfertility treatment), improved employee health literacy, and enhanced support for balancing work and infertility
treatment. In order to support the balance between work and infertility treatment, in addition to ensuring that women
have time for treatment, we newly established a subsidy system for speci c types of infertility treatment.

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KA-RA-DA iki-iki Project
Since 2016, the Human Resources Department, Health Insurance Society, and General Health Development Center haveworked together to introduce the "KA-RA-DA iki-iki Project" targeting all employees, including young employees who
have less interest in health, with the aim of further improving health awareness.
When an employee participates in a health promotion event, they receive "SDGs points," which are converted into moneyand donated by the company to TABLE FOR TWO. The "Kara-Iki points" collected from participating in events can be
donated to social contribution activities or exchanged for health related prizes, so that employees' health e orts help tocontribute to society.
Events10 minutes per day of physicalactivity (Plus 10)
No alcohol challenge program
Breakfast Everyday
Diet recording
Stop eating between meals
KA-RA-DA iki-iki seminars
Harahachi program to promote
moderate meal portions
Walking challenge program
Smoking cessation challenge
program

Sta taking part in KA-RA-DA iki-iki Project

Initiatives for Mental Health
The Human Resources Department, the General Health Development Centers, and the Health Insurance Society work
together to provide detailed advice to employees seeking consultations about their concerns, mental health problems,anxiety, stress, etc., while helping them to manage their mental health. Highly-specialized counseling is also conductedby collaboration between a psychiatrist and a certi ed clinical psychologist.

Results of initiative
The number of employees with a healthy lifestyle has increased.

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We were able to con rm a heightened level of employee health awareness.

External Evaluations

Other related data
Percentage of obese employees
Non-smoking rate
Percentage of employees who took thestress checWork Motivation Survey
Number of women in managerial
positions
Ratio of women in managerial positions
Rate of participation in regular healthcheckups:-year-old obesity rate Male: 24.8% Female: 7.6%
77.2%
92.5％
Work 3.2 Organization 3.2 Colleagues 3.2 Growth and career advancement 3.2
Remuneration 3.1
565
2.2% [March 2005] → 11.5% [End of June 2019] (Daiwa Securities 2.3% → 14.0%)
almost 100%111

SDGs report 2020

Rate of participation in thorough medical
examinations, which are voluntary
screenings (mainly cancer screenings for
employees aged 35 years or older)
Percentage of employees who regularly
exercise:
Proportion of those seeing doctors after
regular employee health checkups withproblematic results in such checkups:

FY: 87% FY

: 90%

21％
88.3％

Health issues(Excerpt from White Book on Health)The proportion of obese people is increasing as a whole. Since the number of obese people tends to increase with age, it is necessary
to raise awareness of health from a young age. Especially for young people, there is a problem with lifestyle habits, such as an increasein the percentage of both men and women who do not eat breakfast. In addition to measures against obesity, it is necessary to takemeasures that will lead to awareness about establishing a healthy lifestyle from the start of employment.
In addition, the number of both men and women with blood pressure for which medical examination is recommended is increasing.
Furthermore, a high percentage of employees with this level of blood pressure remain at the same level the next year and the year
after. Therefore, it is necessary to take prompt measures to support employees who are at or above the blood pressure level for which
medical examination is recommended.
Goals for improvement initiative
Focus on obesity control and hypertension control, continue to provide thorough counseling guidance to each risk group,and encourage them to participate in the "KA-RA-DA iki-iki Project" to make them aware of their lifestyle habits.
In order to ensure that young people have awareness of health from an early stage, implement new health events using
ICT to increase the participation rate. Provide counseling guidance to employees who are obese and enhance
opportunities to obtain knowledge and information on health.
Goals
Reduce obesity rate at age 35 by 30% by 2024
[Target] Obesity rate for -year-olds in FY Male: 20%, Female: 8%112

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Communication with Employees
We believe that good communication with employees is vital for a better workplace environment. We have thus implemented asemiannual self-assessment system whereby employees can communicate their career plans to their superiors and the Human
Resources Department. Under the system, employees can also communicate to the Human Resources Department not only theircareer visions but also their thoughts on the duties they assume, personnel and training systems, the workplace environment, andother matters. Daiwa Securities Group uses such feedback to develop an environment that enables employees to work with a highlevel of motivation.
To give feedback on assessment results, we conduct interviews with department and sales branch heads twice a year, thereby sharing
future goals and career development with them and providing appropriate guidance and advice to each employee.
We also regularly conduct surveys on work-life balance for all employees. We incorporate employees’ feedback, and have introduced
the Nursing Care Concierge Service to remove employees’ concerns about nursing care. We have also introduced a support desk for
employees looking for nursery schools to ensure that those on leave can have a smooth return to work, while expanding a program forsubsidizing expenses for day care and after-school child care for employees with children up to the third grade in elementary school.
Moreover, we conduct interviews with employees returning from childcare leave after a certain time has passed in an e ort to resolve
any worries they may have.
These inputs from employees help us to identify areas for improvement in our systems and initiatives and to create a better workplaceenvironment.
Work Motivation Survey
In August 2018, we introduced a Work Motivation Survey as a monitoring indicator. It is designed to raise employees’
motivation to work through challenges for higher value-added operations and contribute to customers and society,thereby achieving a virtuous cycle of improved employee and customer satisfaction. Based on assessed results, we
identify factors leading to increases in employees’ motivation and use such factors for various measures.

Communication among Employees
In October 2007, Daiwa Securities introduced a program for supporting club activities. This program was created to help employees
enjoy their time o and deepen their friendships with colleagues, building more opportunities for sharing a sense of camaraderie andsolidarity. It is also intended to support work-life balance and facilitate a fuller social life for employees. The program was expanded
and enhanced in FY . Under this program, employee groups that meet certain conditions are recognized as Daiwa Clubs or Daiwa
Circles, which receive subsidies to cover some of their activity costs.
As of March 2020, 20 clubs and ve circles were active across the Group.

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Relationship with Employee Unions
Under various labor agreements signed with employee unions, we regularly hold labor-management negotiations on bonuses andother compensation and the working environment, thereby building a sound labor-management relationship.
We also increase opportunities for learning the opinions of our employees and improve communication through surveys conducted by
employee unions, direct dialogue between management and union members, and other activities.

Initiatives for Families
We work to ensure that members of employees’ families share their pride in being part of the Group. Since FY , we welcome
employees’ families to the workplace on Family Visit Day to give family members a better understanding of our company and theemployees’ jobs. Other initiatives for supporting our employees’ families include the new creation of Kid’s Ceremony Leave, Family
Day Leave, and Parents’ Longevity Celebration Leave, as well as the extension of mental health support to employees’ families.

Active Use of In-House Magazine
Daiwa Securities Group issues an in-house magazine, "Fuji," whose history dates back to 1925, when one of the company's
predecessors, Fujimoto Bill Broker Bank, commenced its publication. The content covers a broad scope from the basic management
policy, a message from top management, speci c SDGs initiatives (includes ESG and improvement of environmental awareness),
information from Group companies, introduction of awardees through our awards system, introduction of family day, explanation of
our welfare and human resources system, human rights issues, to our internal whistle-blowing system (framework and status of
usage). By including information that traverses the Group, our intention in producing the magazine is not only to engendercommunication among company employees but also to further the Group culture, the sense of connectedness and exchange ofknowledge. At present, 20,000 copies of the bi-monthly magazine are distributed among Group executives, employees and retirees. In
addition, the magazine is also posted on the work-life balance promotion website for employees, making it viewable to company
employees who are currently involved in child rearing, nursing family members or are on leave from work.

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Activities to support Communities through Our Foundations
Daiwa Securities Group proactively works on social contribution activities through public interest incorporated foundations and funds
to realize a prosperous society.
Daiwa Securities Health Foundation
For details on Daiwa Securities Health Foundation, click here
In 1972, Daiwa Securities Health Foundation was established in commemoration of Daiwa Securities' th anniversary. It
has changed its grant targets in line with the times. It currently targets research projects on medicine and medical carefor diseases speci c to middle-aged and elderly people, as well as projects on preventing the elderly from becoming
bedridden, rehabilitation, home-based medical care and nursing care, with grants provided mainly to support young
researchers. In FY (its th year of support), the Foundation awarded a total of \30.6 million to 33 recipients. In
addition to the grants, it strives to contribute to local communities through issuing reports on research results, hosting
various seminars, and other activities.

Presentation ceremony at Daiwa Securities Health Foundation (Head O ce)

Daiwa Securities Health Foundation's cumulative grants awarded through FY
Number of recipients

1,288 people

Total amount of grants¥1,268.5 million

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Daiwa Securities Foundation
For details on Daiwa Securities Foundation, click here
In 1994, Daiwa Securities Foundation was launched as part of commemorative activities for the th anniversary of theestablishment of Daiwa Securities. It has provided grants to activities for supporting the elderly, children with disabilities,
and children, and other volunteer work with great social signi cance, as well as disaster relief e orts for victims of largescale natural disasters such as those from earthquakes and torrential rain. In FY , the Foundation expanded its scopeof support by adding activities for supporting children living in poverty or other harsh environments to its grant targets.
In FY (its th year of support the second year of grants for children), the Foundation awarded a total of ¥47.76
million to 184 organizations.

Presentation ceremony at Daiwa Securities Foundation (Nagoya Branch)Daiwa Securities Foundation's cumulative grants awarded through FY
Volunteer Activities Grants

Number of projects receiving grants : 3,674 projects
Total amount of grants : ¥856.46 million

Grants to volunteer work for disasterrecovery (the Great East Japan Earthquake)

Number of projects receiving grants : 258 projects
Total amount of grants : ¥104.66 million

Grants to volunteer work for disasterrecovery (the Kumamoto Earthquakes)

Number of projects receiving grants : 75 projects
Total amount of grants : ¥21.45 million

Grants to activities supporting children

Number of projects receiving grants : 8 projects
Total amount of grants : ¥3.88 million

Media reports concerning grant activities
Daiwa Securities Health Foundation

11 newspapers and TV stations

Daiwa Securities Foundation

Grants to volunteer work for disaster recovery: 35 newspapers and 2
TV station* Surveyed by Daiwa Securities Health Foundation and Daiwa Securities Foundation
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Daiwa Anglo-Japanese Foundation (Chartered in the United Kingdom)
For details on Daiwa Anglo-Japanese Foundation (Chartered in the United Kingdom), click here
As a UK charity for fostering closer ties between the United Kingdom and Japan, the Daiwa Anglo-Japanese Foundation
was established in 1988 with contributions from Daiwa Securities Co Ltd.
The Foundation's Tokyo o ce provides local assistance to Daiwa Scholars (students from the United Kingdom) staying inJapan for about 20 months, administers grant applications from Japan and collaborates with other institutions
promoting Anglo-Japanese relation
Activities
1. Awarding grants to individuals, institutions, and organizations working to promote ties between the United
Kingdom and Japan
2. Awarding scholarships (Daiwa Scholarships) for British graduates to study Japan and the Japanese language
3. Organizing a year-round calendar of events at Daiwa Japan House in London, which is the Foundation’s
headquarters, to improve understanding of Japan in the United Kingdom
4. Organizing events in Japan in collaboration with the British Embassy and others

Receipt of the Japan-British Society Award
For details on receipt of the Japan-British Society Award, click here
The Daiwa Anglo-Japanese Foundation Tokyo O ce won the Japan-British Society Award, and inscribed silverware waspresented by H.I.H. Princess Akiko of Mikasa at the Society’s annual dinner held on November 28, 2019.
The Japan-British Society Awards scheme was set up in 2008 to celebrate the th anniversary of the founding of The
Japan-British Society. The Awards are given every year to individuals and organizations making signi cant contributionsin the eld of Japanese-British relations to recognize their steady e orts that would have otherwise not been
acknowledged.

Silverware given at Japan-British Society Awards (Director of Tokyo O ce on the right)

Daiwa Scholars and Daiwa Scholars in Japanese Studies
For details on Daiwa Scholarships, click here
Daiwa Scholars 2018, who came to Japan in 2018, had four-week home-stays in Sapporo City, Kochi City, Kasuga City,
Miyazaki City, Nago City, and Taketomi Town (Iriomote Island) after completing their one-year Japanese language study.
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In areas where it is possible to visit a Daiwa Securities branch, the Scholars made visits and deepened interaction with
branch sta .

The Daiwa Scholar 2018 completion ceremony

Cumulative number of people completingthe Daiwa Scholar program by FY

182 people

Daiwa Myanmar-Japan Foundation
In April 2013, Daiwa Securities Group established the Daiwa Myanmar-Japan Foundation to improve people's livelihoods
in Myanmar and develop the human capital necessary for sustainable economic growth. Since its establishment, theFoundation has implemented a scholarship student support program that provides junior sta of the country's central
government with opportunities to study in Japan. To date, it has supported a total of 30 scholarship students. Aftercompleting their studies, the students are provided with opportunities to receive training at the Financial Services
Agency of Japan and Daiwa Securities Group. The Foundation has also provided training to 84 certi ed public
accountants in Myanmar to date, based on the tripartite memorandum of understanding signed with the Myanmar
Institute of Certi ed Public Accountants and the Japanese Institute of Certi ed Public Accountants. It also plans to assist
sta of the Government of Myanmar in gaining securities-related credentials, starting in 2020, in an e ort to help improvetheir nancial knowledge. The Foundation’s initiatives are positioned as one of the measures that Japan's public andprivate sectors have worked on together to invigorate Myanmar's capital market. They contribute to developing andcreating a network of the human resources that will form the country’s future leaders.

Contributions by Daiwa Myanmar-Japan Foundation
Number of Myanmar citizens receiving
scholarships

30 people

Number of participants in public accountant 84 people
training* Cumulative contributions until FY
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For Your Dreams - Daiwa Securities Group Smiles to Children
Project
The Daiwa Securities Group has launched the "For Your Dreams - Daiwa Securities Group Smiles to Children Project" to help solve theproblem of child poverty.

Outline of the ProjectAs part of its "Smiles to Children Project," Daiwa Securities Group has created"Daiwa Securities Group Child Support Fund for Bright Future" in collaboration
with the Public Resources Foundation, a public interest incorporated foundation.
And we have donated gifts to children through the "Santa Charity Program", afund-raising activity by executives and employees and volunteers of OBs and OGs
to help children to create fun memories of Christmas.

Why do we support the future of children"The nancial and capital markets are a symbol of capitalism, and its bene t securities companies have been receiving. Meanwhile,
capitalism can generate a disparity, becoming a cause for child poverty, which is a distortion of society. For this reason, we recognize
the need to contribute to solving the poverty issue by using sound pro ts that we have gained from our core businesses.
Progressively declining birthrates and an aging population resulting in a decreased number of children shouldering Japan’s future will
signi cantly a ect the sustainable growth of the country.
Child poverty generates many side e ects, such as inadequate education, possibly leading to a situation where the children
shouldering the future of Japan cannot acquire enough qualities as members of society."
Eradicating child poverty is an extremely challenging goal that cannot be achieved overnight. However, we must now work to improvethe environment surrounding children and break the chains of poverty.

View details

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Daiwa Securities Group Future Support Bonds Child Support Group
Sustainable Fund
Daiwa Securities Group decided to donate \102.5 million of the total amount raised through the issuance of bonds (nicknamed “Daiwa
Securities Group Future Support Bonds”) in June 2020 to the “Daiwa Securities Group Future Support Bonds Child Support Group
Sustainable Fund,” which is to be established in collaboration with the Public Resources Foundation.

Daiwa Securities Group Child Support Fund for Bright Future
Daiwa Securities Group has created “Daiwa Securities Group Child Support Fund for a Bright Future” in collaboration with Public
Resources Foundation, a public interest incorporated foundation. The Fund is designed to improve the environment for children andbreak the chains of poverty. It assists groups supporting children’s future.
Daiwa Securities Group intends to contribute a total of around ¥100 million in the initial ve years and will select grant recipients after
soliciting applicants.

Total amount of grants
for FY (the rst
call)

Total amount of grants
for FY (the second
call)

Total amount of grants
for FY (the third
call)

Santa Charity Program
Since 2017, we have been implementing a Santa Charity
Program—an initiative in which executives, employees, andformer members of Daiwa Securities Group donate Christmas
presents to children. Contributions collected under the Program
are used to purchase assorted snacks and toys and donated tochildren’s homes, livelihood support facilities for fatherlessfamilies, and NPOs supporting children across Japan. The
donations are made through the Public Resources Foundation, a public interest incorporated foundation.

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Why Daiwa Securities Group is Working to Support Children
The nancial and capital markets are a symbol of capitalism, and securities companies have bene ted from them.
On the other hand, capitalism can cause disparities and contribute to the poverty of children, which is also a strain on society.
That is why we believe that we should use the sound pro ts we earn from our core business to help solve the problem of poverty.
The declining birthrate and aging population are advancing in Japan, and the reduced number of children who will carry the future of
the country will also have a major impact on Japan's sustainable growth.
The problem of child poverty has many side e ects, such as the inability to receive necessary education, and it also leads to thesituation in which the children who will carry the future of Japan cannot gain the quali cations they will require as adults.
Eliminating child poverty is an extremely high goal that cannot be achieved overnight.
However, it is now necessary to improve the environment surrounding children and stop the chain of poverty.

MessageOur desire to support children

In the past, I have personally donated items such as toys to children's homes. That was because
there was a facility next to the kindergarten where my daughter used to go.
I am deeply concerned by the growing problem of child poverty in recent years.
The future of children is connected to the future of Japan, so if the problem of child poverty is left
unresolved, it will have a great adverse e ect on the economy. As bene ciaries of the market
economy, securities companies should face up to this problem.

In the rst open call for participants to the "Daiwa Securities Group Child Support Fund for Bright Futures", more than 100
organizations from all over Japan applied. Going forward, we would like to continue to support organizations that are engaged in
activities in their respective regions that help solve the problem of child poverty.
In addition to the company's support activities, we started the "Santa Charity Program" last year, in which Group o cers andemployees and ex-employees can participate voluntarily, and we received more donations than expected. It is important that thesee orts have the support of each and every person involved and are continuously carried out. In the future, I hope that they will become
part of voluntary e orts to tackle various social issues.
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Action with NPOs
The Daiwa Securities Group plans various programs such as disaster relief programs and programs to donate part of the trust fees ofinvestment trusts. By subsidizing NPOs rooted in the community, we are working steadily to provide support where needed.

Daiwa Securities Phoenix Japan Program
In May 2012, we established the Daiwa Securities Phoenix Japan Program as a measure to support reconstruction after the Great East
Japan Earthquake that occurred on March 11, 2011. Under this program, we donate part of the trust fees from the investment trust"Daiwa Nippon Support Fund Vol. 3 - Phoenix Japan -."(Collaboration: Authorized NPO Japan NPO Center)

Kopernik Program
Since scal 2010, the Group has provided support to the American NPO Kopernik, which was established to improve quality of life andreduce poverty in developing countries. This program is operated by donations related to the investment trusts "Daiwa Eco Fund" and"Russell Investment Global Environmental Technology Fund".

Other disaster support (examples)
Donation in response to damage caused by Typhoon Hagibis in 2019 10 million yen
Contribution to Areas Damaged by the 2018 Hokkaido Eastern Iburi Earthquake 10 million yen
Contribution to Areas Damaged by the Torrential Rain in July 2018
10 million yen
About 11.22 million yen (donation activities by o cers and employees)
Donation in response to the heavy rain disaster in northern Kyushu in FY 10 million yen
Donation in response to the Kumamoto earthquake (April 2016) 10 million yen
2016 Kumamoto Earthquake Earthquake Reconstruction Support Site "Kasesurumon."Sponsored the "'New Tohoku' Reconstruction Business Contest"122

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Major initiatives to date
Disasters

Daiwa Securities Group Tsunami Reconstruction Fund (implemented March 2005 to September
2015)
The "Daiwa Securities Group Tsunami Reconstruction Fund" was establishedon March 9, 2005 as a measure to support the reconstruction of areas a ectedby the Sumatra Earthquake and Indian Ocean Tsunami that occurred on
December 26, 2004. This is a long-term support project over 10 years from2005, with Daiwa Securities Group Inc. contributing 10 million yen each year
(100 million yen in total).
(Monitoring: Authorized NPO Asia Community Center 21, Fund management:
Sumitomo Mitsui Trust Bank, Limited)Societykeys program (implemented October 2012 to March 2016)
Since scal 2012, the Group has been providing support to keys, a designated NPO that provides learning support at
orphanages. Under this program, we contribute part of the trust fees from the investment trust "Daiwa SRI Fund" tosupport the activities of this organization.

"Daiwa SRI Fund" Grant Program (implemented April 2006 to July 2013)This is a subsidy program for domestic NPOs with the purpose of developing NPO sta who are active in elds related to"life" (human security elds). We donated part of the trust fees of the investment trust "Daiwa SRI Fund" during its
operation.
(Collaboration: Designated NPO Civil Society Initiative Fund)

Social Business College (implemented October 2010 to September 2012)
As a successor program to "Daiwa JFS Youth Sustainability College", we conducted a program for the general public withthe theme of "social business." We provide the details of this college in the form of lecture records and case study reports.
This program was held using part of the trust fees from the investment trust "Daiwa Eco Fund".
(Collaboration: Music Securities, Inc.)

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Daiwa JFS Youth Sustainability College (implemented October 2006 to September 2010)
A program was held for students in which sustainability was divided into four themes to provide an overall picture overfour years (once session a month). Our college was translated into English and transmitted to 191 countries and regions
around the world from the website of the environmental NGO Japan for Sustainability. This program was held using partof the trust fees from the investment trust "Daiwa Eco Fund".
(Collaboration: Designated NPO Japan for Sustainability)
Environment

Support for production of "Renewable Japan Status Report" (implemented 2010 to 2011)
We donated trust fees from the investment trust "Daiwa Eco Fund" to be used as production costs for the 2011 and 2012
editions of the "Renewable Japan Status Report" published by the designated NPO Institute for Sustainable Energy
Policies.

Daiwa Russell GEF Environmental Technology Promotion Project (implemented 2008 to 2009)This was a project to compile and disseminate a handbook about basic technologies that can be su ciently created andoperated by materials and human resources in developing countries from among Japan's environmental technologies. A
donation was made from part of the trust fees of the investment trust "Russell Investment Global Environmental
Technology Fund."(Collaboration: General Incorporated Foundation Global Environmental Forum)

Daiwa CI Biodiversity Conservation Fund (implemented 2007 to 2008)
We established and supported a fund to support eight local communities that are important for biodiversity conservationin areas around World Natural Heritage Sites. A donation was made from part of the trust fees of the investment trust"Daiwa Eco Fund."(Collaboration: General Incorporated Foundation Conservation International)124

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Promotion of Social Contribution Activities
Daiwa Securities Group believes that participation in volunteer programs and other community activities by employees helps broaden
their perspectives and familiarize them with di erent values. We consider that this, in turn, has a good in uence on both their workand their lives.
Through our intranet, we provide information on volunteer opportunities for projects planned by ourselves, other businesses andNPOs/ NGOs as well as events that help educate employees and raise their awareness. We also strive to create an environment thatmakes it easy for employees to volunteer by setting up a recognition program, the Volunteer Award, and other incentives.
In FY , we also introduced Volunteer Leave. In the rst scal year, a total of 11 employees used this system and participated involunteer activities (for 11 days).

Initiatives to Promote Volunteer Activities
President's Awards program
Daiwa Securities has the President's Awards program to recognize outstanding achievements by employees. As part ofthe program, we introduced the Volunteer Award in FY , which is given twice a year to employees and groups
involved in volunteer initiatives and activities that provide ongoing support to communities.
Dissemination of Information through the Internal Network
The Daiwa Securities Group introduces the best practice in such volunteer work, throughour in-house magazine and internal TV programs.
In-house magazine "Fuji"

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Collection Drive
The Daiwa Securities Group has been running the following collection drives as initiatives that areeasy for employees to participate in. Collected items are donated to various NPOs and sold by themto fund their activities, including support for education, medical services and assistance to thedisabled in developing countries.

ExamplesParticipation in "Used Book Sale Donation for Children's Future" (donation to Children's Future Support Fund )Donation of unusable postcards and used stamps (donations to Japan Committee "Vaccines for the World's Children"
and Live with Friends on the Earth)
Donation of redundant calendars (donations to groups involved in disaster assistance or community support activities,
which are selected each scal year)
Contribution made in FY

through collection drives (equivalent monetary value)

Used Book Sale Donation for Children's Future : ¥121,961
Japan Committee "Vaccines for the World's Children" : ¥112,455
Live with Friends on the Earth : ¥91,388

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Donation Activity through Food and Drink
Since the spring of 2013, Daiwa Securities Group has contributed to the TFT Program, which isorganized by TABLE FOR TWO, an internationally designated NPO. This is an initiative aimed atcorrecting food imbalances between developing and developed countries by donating a portion ofrevenue from the purchase of food and drink by Group o cers and employees to pay for school
lunches in developing countries.
We introduced the TFT menu at the cafeteria in the head o ce building and the sta cafeteria in
Daiwa Institute of Research and Daiwa Facilities Co., Ltd. started donating ¥1 per drink sold throughthe beverage vending machines installed within the Group. Moreover, points earned through the“KA-RA-DA iki-iki Project,” which is aimed at strengthening employees’ health, can now be
redeemed for contributions to the TFT Program. We have thus expanded the platforms forparticipating in the TFT activities.
The contributions made through the TFT Program during the period of January to December 2019were equivalent to around 151,688 school lunches in developing countries (calculated on theassumption that one meal costs ¥20).

Donation of Shareholder Reward Items
Daiwa Securities Group Inc. implements a shareholder reward program. Together with the operation of this program, we donate
reward items returned to us due to the relocation of shareholders and other reasons, as well as reward items received for ourshareholdings in other companies, to organizations such as designated NPOs and public interest incorporated foundations.
Our donation recipients in FY included children’s dining rooms that assisted children by providing food during temporary school
closures due to the COVID- pandemic.

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Initiatives in Japan
Initiatives for Community Vitalization
Under the SDGs initiative for community revitalization, Daiwa Securities supports regional festivals across Japan tocontribute to revitalizing communities.
In FY , executives and employees deepened interaction with communities in the nd Hinokuni Festival (Kumamoto
Branch), the nd Wasshoi Hyakuman Summer Festival (Kita-Kyushu Branch), Awa Odori Festival (Tokushima Branch),
Mito Komon Festival (Mito Branch), the th Fukushima Waraji Festival (Fukushima Branch), and Yamagata Hanagasa
Festival (Yamagata Branch).

The th Yamagata Hanagasa Festival (Yamagata Branch)

Awa Odori Festival (Tokushima Branch)128

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Disaster Restoration Assistance
Daiwa Securities’ Sendai Branch supports TOUR de TOHOKU, a cycling event aimed at assisting restoration e orts, etc.
after the Great East Japan Earthquake. On the event day, branch employees and their families took part in volunteer
work, providing well-designed drinks at aid stations to riders who gathered from all over Japan.

Photo of members participating in the volunteer activity (Sendai Branch)“Souvenir SDGs” Project
The Secretariat has incorporated an the SDGs perspective into its souvenir selection criteria. It uses as gifts products
selected by focusing on themes such as community building, restoration e orts, fair trade, and support to developing
countries when looking for products. The criteria proposed by the Secretariat have been widespread across the company.

Examples of souvenirs contributing to SDGs

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Initiatives Taken by the Group's Overseas O ces
Activities at the Group's London Operational Base
Daiwa Capital Markets Europe (“DCME”) has started company-wide initiatives to contribute to sustainability. In FY , itplans to establish an SDGs Subcommittee and an ESG Subcommittee.
The SDGs Subcommittee will focus on diversity and inclusion, sustainability, promotion of health (well-being), anddonation (charity) activities. Meanwhile, the ESG Subcommittee will put emphasis on accumulating expertise and results
in relation to ESG from the perspectives of business, risk, and regulations. It will contribute to the development of the
ESG markets in Europe and Japan. Through these company-wide approaches, DCME aims to turn the promotion of health(well-being) and economic, environmental, and social sustainability into the cornerstone of its activities and values.

Environmentally Friendly O ce
DCME’s Facilities Department always keeps in mind reducing carbon dioxide emissions in the o ce and environmental
impact in light of SDG Goal 12 “Responsible Consumption and Production” and Goal 13 “Climate Action.” Whenformulating an environmental plan for 2019, it focused on the energy consumption, waste, and sustainability of DCME
and its supply chain as a whole.
In 2019, DCME replaced the boiler of its heating system to improve the system’s energy e ciency while replacing all lights
in its building with LED lighting. These measures, along with improvements to the building management system, haveenabled the company to reduce its electricity consumption by 42% and gas consumption by 30% since 2014. DCME has
also changed its power company so that a large part of the power supplied to its o ce would be from clean andrenewable sources.
DCME executives and employees are encouraged to use recycling boxes set on each oor. Waste that is not recyclable isburned at an incineration facility as an energy source. Food waste is converted into a fuel source after its organic
components are decomposed in anaerobic digestion process.

DCME’s entrance hall. LED lighting is used for all lighting equipment

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Initiatives by Employees
DCME supports two charities each year. It donates contributions made by executives and employees to these charities
while regularly sharing messages from the charities. In FY , DCME supported “The Mizen Foundation” and “School ina Bag.” As part of activities for supporting “School In a Bag,” executives and employees carried out the task of packing
stationery into 200 bags at the DCME o ce, and the bags were sent to underprivileged children.
In addition, as an initiative related to SDG Goal 2 “Zero Hunger,” DCME made a donation to a food bank in the Hackney
district of London. The groceries and daily necessities collected by executives and employees were put into small, easyto-carry packages and provided to people in need.

CEO Meekins and the “School Bag” he made and donated to aschool in Ghana

Activities at the Group's New York Operational Base

Charity Friday
Daiwa Capital Markets America (“DCMA”) hosts a “Charity Friday” once a month in which employees are allowed to wear
jeans for their $5 donation to a selected charity. DCMA matches double the collection amount each Charity Friday,
increasing the impact of our donation and furthering our commitment to the various causes we support. In 2019, thecompany made donations through Charity Friday to the following organizations.
the Susan G. Komen for the Cure in support: the largest breast cancer organization in the United States addressing
breast cancer on multiple fronts, including research, community health, worldwide outreach, and public policy
initiatives
Tuesday’s Children: provides support and a safe “landing place” to traumatized children, families, and communities
left reeling from terrorism or traumatic loss
Children’s Aid: Supports families living in New York City who struggle with poverty and their children
and others
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Wellness Initiative /Women's Initiative
Under its “Wellness Initiative,” DCMA holds programs and events throughout the year to promote health and wellness. In
June 2019, the company invited healthcare professionals to its health and wellness fair and provided its employees with
an opportunity to receive checks on their blood pressure, skin age, and BMI in a fun way to raise their awareness ofhealth. In addition, DCMA issues monthly newsletters and holds nutrition seminars twice a year, and through these
initiatives, along with other e orts, the company provides its employees with opportunities to deepen their knowledge ofhealth.
DCMA invited Keiko Tashiro, Deputy President of Daiwa Securities Group as a special guest of its “Women’s Initiative,” andDCMA female employees exchanged opinions on women’s work styles. Furthermore, in an e ort to help women succeed,
DCMA makes a donation to “Dress for Success,” a global NPO that o ers clothes and shoes to low-income women to assist
them in going through the job hunting and job interview process.

Let’s Support COVID- Fighters! Feeding the Front Line in NY
With challenging situations continuing worldwide due to the e ects of COVID- , DCMA supported “Let’s Support COVID19 Fighters! Feeding the Front Line in NY,” a project to bring complimentary bento lunch boxes to medical professionals
working under di cult circumstances every day.
This is an activity for continuing to provide bento lunch boxes to frontline medical professional ghting against the virus
while risking their lives. It was launched after an appeal by the Nippon Club, which many Japanese companies operatingin the United States join. The activity commenced in May 2020, starting with hospitals in New York City, and the scope of
its targets has been gradually expanded since then to include hospitals in other areas.

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Activities at the Group’s Singapore Operational Base
Daiwa Capital Markets Singapore Limited (“DSL”) conducts various activities that proactively support promotion of SDGs.
For example, dozens of DSL sta participated in a volunteer sewing activity sponsored by a charity. They e ectively
utilized resources by creating pocket tissue pouches at the o ce, using cloth from used clothing, during lunch time andother occasions and donating the completed pouches. Moreover, DSL has also set up a space for collecting used clothing,unopened food products, and other items within the o ce and has continued to use resources e ectively. These
initiatives have helped to promote a deeply-rooted sense of ownership among employees.

Activities at the Group's South Korea Operational Base

Participation in “Love Kimchi Fair”
Following on from 2018, Daiwa Securities Capital Markets Korea (“Daiwa Korea”) participated as a social contribution
activity in the “Ninth Love Kimchi Fair” on November 20, 2019. The event was organized jointly by securities industryrelated bodies, including the Korea Financial Investment Association and the Korea Exchange. Kimchi is essential to
Koreans’ diet as it is said that no other side dishes are needed if kimchi is there. In the country, people follow gimjang, a
traditional practice of making a large quantity of kimchi in advance around the end of November each year to prepare fora long, cold winter. The 36,000 kg of kimchi made on the day of the “Ninth Love Kimchi Fair” was sent to welfare facilities
supported by the Green Umbrella Children’s Foundation, an NGO, and the Korea Financial Investment Association to help
the socially disadvantaged.
In addition to this, Daiwa Korea makes a donation every month to Korea Food for the Hungry International, an NGO
providing support to starving children within and outside South Korea, to further contribute to society. In South Korea,
the central government has recently been strongly promoting e orts to achieve work-life balance, and local companies
have been actively implementing measures in line with the government’s policy. Amid such trends, Daiwa Korea isworking on the following: (1) encouraging proactive participation in social service activities (introducing social
contribution activity programs and providing compensatory leave to employees who participate in weekend activities);(2) creating comfortable work environments for women (improvement of welfare programs at each stage of pregnancy,
childbirth, and child rearing, allowing adjustment of working hours and providing time to visit doctors for pregnant
employees, setting up a nursing room and providing time for nursing at the discretion of the department head); and (3)133SDGs report 2020encouraging employees to leave the o ce on time and take their annual paid leave (employees are required to submit
their annual paid leave plan through to the end of period to management) to achieve work-life balance, and enhancing
the welfare bene t system (supporting employees' self-development expenses, such as for studying languages, andexpenses for promoting and maintaining health).
Daiwa Korea will continue these activities and proactively respond to the corporate image expected by Korean society inan e ort to contribute more extensively to society.

Collaborative Programs
Daiwa Securities Group engages in collaborative programs as part of our e orts to create an environment where our employees nd it
easy to participate in volunteer activities.
Membership of a community-based organization for volunteer work [Japanese]
Daiwa Securities Group is a member of an organization for volunteer activities, based in the Chiyoda ward of Tokyo, comprised of 17
companies and one body that works on initiatives contributing to communities together with other members.
Chiyoda Volunteer Club [Japanese]
Since 2009, we have joined the Chiyoda Volunteer Club, a free-of-charge membership program operated by Chiyoda Volunteer Center.
Club members receive information on volunteer activities within the Chiyoda ward every month through an e-mail newsletter. The
system of the club is simple and convenient encouraging our employees to participate in volunteer work under this program.

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Past Activities
Forest Preservation Activities
Daiwa Securities Group has continued to conduct hands-on programs for experiencing the importance of maintenanceand preservation of forests, which account for two thirds of Japan’s total area.

Hands-on Forest Experience in Sayama Hills
The Group provided employees and their families with a forest preservation experiencefor 10 years from 2005 to 2014 at Mount Takao (Hachioji City, Tokyo). We changed theplace of activity to Sayama Hills in Tokorozawa City, Saitama from FY and have been
conducting a program aimed at community village preservation activities.

Hands-on Forest Experience in Mount Takao
The program was implemented at Mount Takao (Hachioji City, Tokyo) for 10 years from2005 to 2014. It involves thinning out trees in the rst year and carrying out maintenancework for pathways in the second year, using lumber from the thinning work. The
program attracted around 30 participants each year as a program in which both parents
and children (elementary school children or older) can participate.
Food Culture Exchange with Daiwa Scholars
Together with the Daiwa Anglo-Japanese Foundation, the Group holds a food culture
exchange event between Group employees and Scholars coming to Japan in September
each year. The event is held for the purpose of cultural exchange between Japan and theUnited Kingdom. Through a cooking experience, we introduce washoku (Japanesecuisine), which has been added to the UNESCO Intangible Cultural Heritage list and is
loved across the world.
Holding of Events with Sign Language and Simultaneous Captioning
Daiwa Securities Group has provided sign language classes for beginners to increase
understanding and use of sign language. On July 7, 2011, to celebrate the thanniversary of the classes, we held an event that could be participated in together withpeople with a hearing impairment. The sign language classes have ended, but we havecontinued to hold events using sign language and simultaneous captioning on an
irregular basis.
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Economic and Financial Education for the Young Generation
Capitalizing on nancial and economic expertise accumulated through its securities business, Daiwa Securities Group engages inbusiness-academia collaborations and supports programs for junior and senior high school students as well as teachers. We believethat economic and nancial education is important in helping young people develop the capacity to build their own lives and shape
the future world.

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Example of Business-Academia Collaborations: University of Tokyo Hongo Tech Garage (Donation Project by Daiwa
Securities Group)
Daiwa Securities Group supports the University of Tokyo Hongo Tech Garage, which was established by the University ofTokyo in 2016 as a site to advance entrepreneurship education (a donation project by Daiwa Securities Group). To date,
the project has drawn nearly 500 students and other participants, leading to the launching of several companies eachyear. Among such companies, teTra aviation corp., has achieved success. Established in 2018, the company became thesole prize-winning team in the world competition for personal ying devices sponsored by Boeing in February 2020.

Class at Elementary School In July 2019
Daiwa Securities Shibuya Branch Chief Ono visited an elementary school in the
Minato ward and gave a class there. This was part of the career education event
held by the school during the summer vacation to increase interest in jobs
among students. The class was well received by the school organizing theevent.
Branch Chief Ono providing a class on thetheme of the Group’s nancial education
textbook “Let’s Learn about Stocks”

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Financial Education Textbook "Let's Learn about Stocks"
Daiwa Securities Group Inc. prepared "Let's Learn about Stocks," a nancial education textbook targeting upper-grade
elementary school children and above, with support from school teachers.

TargetUpper-grade elementary school children and above

Content
Company role
Structure of the corporation and nancing with shares
The role of stock exchanges and how stocks are helping
Role of securities companies
Click here for details [Japanese][PDF: KB]
Support to "Job Museum" and "Job Almanac"
Since FY , Daiwa Securities Group Inc. has been providing support to "Job Museum,"
career education materials for elementary school children released by The Asahi
Shimbun Company.
Click here for details [Japanese]
The web version, "Job Museum Kids," has a quiz and other features enabling visitors toenjoy the site like a game.
The book version, "Job Almanac," has been donated to elementary schools and juniorhigh schools across Japan, as well as overseas Japanese schools and some children's
cafeterias.
"Job Almanac 2018" Donation of 64,000 copies (published on June 15, 2018)"Job Almanac 2019" Donation of 67,000 copies (published on June 17, 2019)"Job Almanac 2020" Donation of 70,000 copies (published on June 29, 2020)138

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Information on economic and nancial education learning website

SODATTEThe website sets up ve categories, including "Money Lessons," "Family Finances" and"Education Funds," and disseminates columns that provide tips to child-rearing
generations.
Click here for details

Picture book of money for toddlers "a-i-u-e-o kane no ehon"This is a website where adults and toddlers of the child-raising generation can study
together and learn the Japanese hiragana.
Click here for details

Okane no Mikata
A website where teenagers, mainly junior high and high school students, can enjoy
learning basic knowledge about nance, economy and investment that will be needed in
the future to plan their own life and manage money.
Click here for details

Daiwa Internet TV
In 2000, Daiwa Securities Group began "Daiwa Securities Information TV," Japan's only
channel dedicated to securities information, on the multichannel pay TV broadcast
service "SKY Perfect TV!" Since April 2011, we have been producing "Daiwa Internet TV" atour own studio and distributing it online in an e ort to target a wider range of viewers. We
distribute information on the Tokyo market ve times a day in a timely manner, whileproviding local market information from Hong Kong and New York every day.
In addition to these daily programs, we distribute corporate information as well as video
reports where analysts and economists at Daiwa Securities and DIR provide
commentaries on current issues in an easy-to-understand way.
Our Daiwa Internet TV initiative was introduced by the SDG Industry Matrix for Financial
Services (issued jointly by the United Nations Global Compact and KPMG International in2015) as a case for Goal 4 "Quality Education." The report highlighted Daiwa's timely andfree of charge provision of a variety of nancial and investment information.
We will continue to make e orts to produce programs that can be viewed by not only
investors but also those who are new to investment, and that can support the journeyfrom savings to asset building.
Daiwa Internet TV
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Support for KidZania

Daiwa Securities Group is a supporter of KidZania, a theme park designed too er work experiences to children, and has been providing support to thefacilities in Tokyo and Koshien (Hyogo Prefecture) since they opened. KidZania
provides children from the age of three to 15 with programs that enable themto learn the mechanisms of society in a fun way. In the Daiwa Securities
pavilions, children act as consultants at a securities company, giving advice toclients, going to nearby pavilions, and checking their levels of tra c andpopular products. Based on the results of those checks, they then makeinvestment recommendations for their clients.

KidZania

Finance Park
Daiwa Securities Group cooperates with Finance Parks operated by Junior
Achievement Japan, a public interest incorporated foundation. This programprovides opportunities for junior high school students to learn economic andnancial mechanisms that will be necessary for them in their adult life. Finance
Parks have been operating in Shinagawa (Tokyo), Kyoto, Iwaki (Fukushima
Prefecture), and Sendai (Miyagi Prefecture). We have set up pseudo-branchesof Daiwa Securities in these parks.
Number of participants in Finance Parks for FY
21,102 people(on an application basis; surveyed by
Junior Achievement Japan)

Breakdown
Shinagawa: 1,854
Kyoto: 7,804
Iwaki: 3,183
Sendai: 8,261

Student Company Program (Company Management Experience Program)Daiwa Securities Group cooperates with the Student Company Program provided by Junior Achievement Japan. In the
program, high school students learn about management and the functioning of companies by actually managing a stockcompany. In FY , high school students in Tokyo established a stock company during an extracurricular class. Daiwa
Securities Group employees participated as outside directors for six months, providing advice on company management.

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CEE Japan

Daiwa Securities Group supports CEE Japan, a general incorporated association, to provide economic education
programs for school teachers. In partnership with the U.S. Council for Economic Education (CEE), we seek to implement
programs tailored to Japanese schools.

Introduction of Books
Economic Puzzle Sleuths: Understanding the True Meaning of Money
Written by Susumu Okano
The Asahi Gakusei Shimbun Company
This book explains the economy as a whole in an easy to understand way, from the
beginning of money to recent worldwide nancial crises. On reading through the book,readers will be able to see the ow of the global economy and acquire a generalknowledge of money, as hints for living a wise life.
Click here for details

Economics Learned by American High School Students
Written by Gary E. Clayton
Translated by the Product Planning Department of Daiwa Securities
Translation supervised by the Education Business Department of Daiwa Institute of
Research
WAVE Publishers
This book is the translation of the 1999 version of “Economics: Principles and Practices,”
which is a textbook generally used by U.S. high school students. The translation work
was carried out by the Product Planning Department of Daiwa Securities and the
Education Business Department of Daiwa Institute of Research. The book explains in aneasy to understand way the mechanisms of the economy, such as how the prices ofgoods are determined.

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Environmental Management / Initiatives to Environmental Load
Reduction
Protecting the global environment, which is the basis of our livelihoods, is essential for a sustainable society. Through our businessactivities, Daiwa Securities Group contributes to the resolution of environmental issues by developing products that reduce theenvironmental burden, and also by assisting nancing for the development of environmental technologies and infrastructure. At thesame time, we are working to establish a system that e ciently collects data on the Group's environmental load. We are also focusing
on raising employees' environmental awareness to empower them to reduce the environmental burden in daily business operations.
In our FY management strategy brie ng, we listed the volume of CO2 emissions as one of our FY KPIs for promoting
achievement of SDGs. Thus, working on reducing the environmental burden of society as a whole has become part of our management
strategy.
Environmental Vision
The Group is dedicated to protecting the precious global environment and preserving it for future generations by leveraging
nancial capabilities.
Environmental Principles
The Group recognizes the importance of environmental principles such as the e ort to combat global warming, recycling
and reuse of raw materials, and preserving biodiversity, in order to create a sustainable society for the st century. The
Group pledges to contribute to solving environmental issues through its business as a nancial services company and, toconstantly seek new ways to reduce its environmental impact as a responsible corporate citizen.
Basic Environmental Policies
1. Make positive environmental contributions through our core business activities
We shall seek to develop and provide nancial products and services that promote a low-carbon, recycling-oriented,
and symbiotic society.
2. Implement an environmental management system
We shall implement an environmental management system and constantly seek new ways to improve environmental
activities. In addition, we shall support environmental education and publicity e orts, while promoting environmental
protection e orts by employees.
3. Take steps to save natural resources, reduce energy consumption, and promote biodiversity system
We shall continue to progress in our e orts to reduce the use of natural resources and energy, and seek ways to improvematerials and energy e ciency (including e orts to improve business e ciency). We shall also take steps to reducewater use and reduce, reuse, and recycle other materials to contribute to a more environmentally friendly society.
Furthermore, considering the importance of biodiversity, we shall seek a symbiotic relationship with the environment
and use safe, clean methods of materials procurement.
4. Promote environmental communication
Working in concert with business partners, the local community, NGOs and NPOs, we shall actively disseminate
information about environmental issues, and communicate our concern for the environment to customers and society
at large.
5. Strictly observe environmental regulations
We shall always endeavor in environmental preservation, observing environmental laws and regulations in addition to
the Group's environmental policies.
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Targets for FY

Initiatives for the reduction of CO2 emissions
Continue to reduce CO2 emissions by at least 1% compared with the previous scal year.
* On a Domestic consolidated basis

Initiatives for the reduction of electricity consumption
Achieve a reduction of at least 10% from the FY level (as of FY
Achieve a reduction of at least 20% from the FY level (as of FY* On a per unit area basis for both targets))

Improve the accumulation of environment-related data hone analytical skills
Continue to introduce eco-cars
Purchase products certi ed under the Japan's Top Runner Program standards

Initiatives to Reduce the Environmental Impact of Business Activities
Introduction of Environmental Accounting

As part of our e orts to reduce environmental loads, Daiwa Securities Group prepares and discloses environmental
accounting. It is expected to help us to track the costs and e ects of environmental preservation more accurately andreduce environmental loads more e ectively.
Refer to "SDGs Related Data" for details
Initiatives at Group Companies

When installing new equipment at head and branch o ces, Daiwa Securities requires that the equipment be certi ed
under Japan’s Top Runner Program standards. In FY , we investigated the impact of postponing the replacement ofmultifunction copiers and other equipment at the head o ce as well as the elimination of paper associated with theintroduction of tablet devices. As a result, we have decided to replace equipment within the head o ce in FY withproducts satisfying Top Runner Program standards, while planning to reduce environmental loads through reduction of
surplus equipment. We are aiming for a 10% reduction in multifunction copiers.
We have also been successively replacing our company cars since FY with eco-cars and hybrid vehicles that havesigni cantly improved fuel e ciency. With the completion of the planned replacement, CO emissions will be reduced byan amount equivalent to the CO absorption of more than 40,000 Japanese cedar trees annually (an estimate by Daiwa
Securities using fuel e ciency data disclosed by automakers).
The introduction of LED lighting into the head o ce of Daiwa Institute of Research was completed in the summer of 2017.
In addition, Daiwa Securities Group strives to choose environmentally friendly products in its central purchasing.
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Company cars in Japan (Daiwa Securities) 1,065 vehicles
including
837 eco-cars
157 hybrid cars
(As of March 31, 2020)
Introduction results for FY
409 eco-cars
11 hybrid cars
Introduction plan for FY
76 eco-cars
28 hybrid cars
Cases of soil and groundwater pollution found within o ce sites FY
Investment in energy-saving air conditioning systems for FY

0¥47 million(including installation costs)
Initiatives to Raise Environmental Awareness
Daiwa Securities Group is striving to raise the environmental awareness of each employee through various initiatives. For
example, our in-house magazine, "Fuji," has a column entitled "Eco-Initiatives in the O ce." The column mainly shares
the status of the Group's environmental initiatives and introduces environmental measures that can be implemented by
employees, depending on their individual awareness.
We also participated in a campaign led by the Tokyo Metropolitan Government's Bureau of Environment to promotee orts to reduce plastic shopping bags at convenience stores within o ces. The initiative is still being implemented evenafter the end of the campaign.
When printing documents, we recommend using aggregate printing and double-sided printing. We also encourage thereduction of paper usage by showing operational guidance and the rate of reduction in paper usage for every threemonths in the areas within o ces where multifunction copiers are installed. We reduced paper consumption by 6.4%
year on year in FY , within the same scope as FY .

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O ering Environmentally Friendly Services
Daiwa Securities provides an “e-Member” online service allowing customers to receive various reports, including
prospectuses and reports on the details of transactions and transaction balances, in electronic format on the Internet,
instead of written noti cations (hardcopy reports and prospectuses). Reports and prospectuses received in electronic
format can, in principle, be accessed and checked online as and when required, saved to personal computers and otherdevices, and printed for ve years after initial receipt.
As of March 31, 2020, about half of Daiwa Securities’ customers use this “e-Member” online service. We will continue
recommending the service to increase the number of customers using it.
Daiwa Securities also uses LIMEX in part of its promotional items such as ballpoint pens and seminar bags. We areconsidering expanding its use going forward.
* LIMEX is a composite material made from limestone that is expected to reduce environmental impacts. It is a registered trademark of
TBM Co., Ltd.

CO2 Emissions
In comparison with the previous scal year, CO2 emissions in FY fell by approximately 0.7% for Daiwa Securities
Group's domestic o ces, as a result of a positive initiative to conserve energy.
Refer to "SDGs Data Edition 2020" for details
Initiative to Reduce CO2 Emissions
We have set up the goal of reducing CO2 emissions, while complying with the Act on the Rational Use of Energy andTokyo's environmental protection ordinances in a continuous and systematic way. We continue to take energy saving
initiatives, including implementing the "Cool Biz" program again in FY , carrying out energy savings measuresthrough on- and o -peak periods.

Initiatives Regarding Impacts of Climate Change
In recent years, concerns have been raised about the possibility of large-scale ood damage due to the signi cant increase in sea level
resulting from global warming and the occurrence of super typhoons. Some major o ces of Daiwa Securities Group are located not far
from the coast and rivers and may be a ected if large-scale ood damage occurs.
The Group will continue with our e orts to minimize the impact of such damage on its operations not only by making general
preparations for ood damage but also by decentralizing important facilities and buildings into multiple locations and moving
equipment to upper stories. We aim to minimize the physical risk of climate change on our business activities.

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Initiatives in Real Estate Management (Daiwa Real Estate AssetManagement Co. Ltd.)
Daiwa Real Estate Asset Management launched a Sustainability Committee in FY with a view to systematically addressing a varietyof ESG related challenges. The company formulated the Rules on the Sustainability Promotion System in FY . These rules clarify thepromotion system and policy on disclosure of information related to sustainability activities of each investment corporation.
Initiatives at Shinjuku Maynds Tower
At the Shinjuku Maynds Tower building, which is owned by Daiwa O ce Investment Corporation (DOI), we havecontinued to install LED lighting systems since 2012, replacing lights in common-use space, such as the undergroundparking lot, rst basement level, and entrance on the rst oor. As a result, we have already achieved our initial target of
installing LED lighting in approximately 80% of common-use space. We have also adopted the green lease scheme since2014 to promote the use of LED lighting in tenant-owned spaces. The installation has proceeded gradually under thescheme, with both tenants and landlords enjoying its bene ts. We expect LED lighting to be introduced into
approximately 95.9% of the area of tenant-occupied spaces by the period ending November 2020. The property wascerti ed by the Development Bank of Japan (DBJ) as a “building with exceptionally high environmental and social
awareness (Four Stars)” in February 2019.
CO2 emissions reduction by adopting LED lighting (in comparison with the levels prior to the introduction of LED lighting)Approximately 648.0 t-CO2 a year
(Shinjuku Maynds Tower in 2019)* Green lease scheme: A method enabling the landlord and the tenant of a rental building or other type of rental property to cooperate
and reduce the environmental load in a scheme bene ting both sides. Such methods include an arrangement where part of the tenant’ssavings attributable to the landlord’s investment in energy-saving facilities, such as a decrease in electricity charges, is returned to thelandlord as a green lease payment.
* Scoring model of DBJ Green Building Certi cation: A comprehensive scoring model uniquely developed by the Development Bank ofJapan Inc. (DBJ). The DBJ grants certi cation to real estate properties that are highly environmentally and socially friendly (“Green
Building”), based on a ve-level ranking system.

Initiatives at Daiwa River Gate
At Daiwa River Gate, which is owned by DOI, we installed solar wind powered street lights in 2018, taking advantage of theproperty’s environment of strong winds and abundant sunlight, as it adjoins a river. The installation has enabled us to
use renewable energy to increase the intensity of illumination. As a result, the intensity of illumination has increased tothe extent that the steps in the stairs areas can be seen clearly, and this has also contributed to improving theenvironment surrounding the building from crime prevention and other perspectives. We plan to consider introduction ofsuch facilities into other properties as well, depending on the situation, and install them successively going forward.

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Initiatives at Rental Residences
Daiwa Securities Living Investment Corporation has been advancing initiatives for environmental conservation. For
example, it is introducing LED lighting, energy-saving air conditioners, and eco-friendly wallpaper into the rental
residences it owns. It also posts notices in the residences, encouraging residents to save electricity, water, and otherresources.
Status of FY initiatives
Installation of LED lighting: 829 units
Installation of energy-saving air conditioners: 639 units
Replacement with eco-friendly wallpaper: approximately 100,000 m² (reductions of CO2 emissions: approximately
18,980 kg-CO2)

Toward Achieving a Hydrogen Society: Entrusted with Global Trends
Survey by NEDO
Daiwa Institute of Research (DIR) has been commissioned to undertake survey and research work by the New Energy and Industrial
Technology Development Organization (NEDO) toward the realization of a hydrogen society. The commissioned work encompasses thecollection and analysis of information on the latest trends across the world (the United States, Canada, EU countries, China, and South
Korea) concerning hydrogen fuel cells, as well as identi cation of issues for development strategies in hydrogen fuel cell technology inJapan.
The survey and research work is aimed at timely collection and analyzing of a wide range of the latest information on hydrogen fuelcells, and sharing it with relevant parties in Japan, toward the realization of a hydrogen society, taking safety and the environment into
consideration. The information includes policies and markets for hydrogen fuel cells and research and development trends across theworld, including in the U.S., Canada, EU countries, China, and South Korea. As part of these activities, DIR visits international
institutions and attends international meetings. Japan, the U.S., and Germany took the lead in the fuel cell eld, but various countries,
such as China, South Korea, Australia, and the Netherlands, have recently been searching for uses of hydrogen suited to their energy
situation. The work is also aimed at identifying issues for Japan’s strategy for developing hydrogen fuel cell technology going forward
by accurately understanding, assessing, and analyzing developments in other countries.
In this way, DIR will be proactively engaged in business related to development of new energy sources that are environmentallyfriendly.

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Response to the TCFD
Expression of Support for the TCFD
Taking the opportunity presented by the adoption of the Paris Agreement in December 2015, e orts that include the mitigation of andadaptation to climate change are under way around the world to transition to a lower-carbon society. In the nance industry, there areconcerns that climate change will a ect the business activities of investee/borrower companies, resulting in instability in the nancial
market.
In December 2015, the Financial Stability Board (FSB*1) established the Task Force on Climate-related Financial Disclosures (TCFD*2) toconsider climate-related information disclosure and nancial institutions’ responses at the request of G Finance Ministers andCentral Bank Governors. Subsequently, in June 2017, the TCFD announced its nal report which recommends that nancial andnon nancial companies disclose the nancial impacts of climate change.
Under these circumstances, Daiwa Securities Group Inc. announced its support for the TCFD in April 2018 to further promote
environmental initiatives, including climate change initiatives such as on climate change. In May 2019, the Company participated in the
TCFD Consortium, which is a platform for dialogue among companies and nancial institutions that support the TCFD and in which the
Ministry of Economy, Trade and Industry, the Financial Services Agency, and the Ministry of the Environment of Japan also participate
as observers.
*1. FSB: Financial Stability Board*2. TCFD: Task Force on Climate-related Financial Disclosures

TCFD o cial website

Impact on Daiwa Securities Group in the Course of a Transition to a
Lower-Carbon Economy
Based on the TCFD Recommendations, Daiwa Securities Group is disclosing information on climate change initiatives for each of thefour core elemnts of disclosure, as shown in the table below.,. At the present time, the Group is currently undertaking analysis basedon multiple climate-related scenarios, identifying risks and opportunities related to climate change for the Group while proceedingwith quantitative evaluations of the major businesses that may be a ected by climate change and expected nancial impacts.
Going forward, the plan is to enhance the disclosure of the analysis results and the Group’s countermeasures based on them. In
addition to working to further enhance information disclosure and to strengthen communication with stakeholders, the Company willcontinue to position climate-related risks and opportunities as one of its most important management issues while advancing thebuilding of a sustainable business structure.

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Disclosures in Accordance with the TCFD Recommendations
Governance

Strategy

The organization's governance aroundclimate-related risks andopportunitiesa) Oversight by the Board of Directorsb) Management's role

Impacts of climate-related risks andopportunities on the organization's
businesses, strategy, and nancial
planninga) Climate-related risks andopportunitiesb) Impacts of climate-related risks andopportunitiesc) Potential impacts under di erent
climate-related scenarios

Monitor climate-related risks andopportunities

Environmental
Initiatives
Structure of SDGs
Promotion

Conduct Scenario analysis* ofclimate-related risks andopportunities Identify the following
risks and opportunities during theanalysis process (Refer to diagram inlower half of page for process)Action throughProduct
Development andDistribution
Support for
Creating Our
Future Society
Investment inGreen Gira e(1) Formulation of Environmental Vision,
Environmental Principles, and Basic
Environmental Policies(2) Chaired by the president and CEO, theSDGs Promotion Committee considers
various social issues, including thoserelated to climate changes, when
examining and discussing materiality
and business plans ,as well as whensetting KPIs.
(3) Reports on content discussed in (2) tothe Board of Directors and the
Executive Management Committee asappropriate SDGs managers in placeat each headquarters and Group
company monitor the businessenvironment from the perspective of
SDGs/ESG, including climate-relatedrisks and opportunities* The scenario analysis conducted this time
was provisional, limiting the scope oftargets. Going forward, the scope oftargets will be expanded＜Opportunities＞(1) Increase in demand for funds toprepare for a lower-carbon society( nancing for the renewable energy
business, issuance of Green Bonds,
etc.)(2) Increase in deals underwritten inassociation with (1)(3) Increase in opportunities for investingin new industries and companies that
contribute to the transition to a lowercarbon society(4) Increase in business opportunities forproviding solutions to assist in thetransition to a lower-carbon society (149

SDGs report 2020

Items
Strategy

Recommended disclosures

Initiatives

Infrastructure-related advisory
services, including renewable energy)(5) Improvement of evaluations fromstakeholders through appropriate
disclosure of the aforementioned
initiatives.

＜Risks＞(1) Decrease in business from companies
and others signi cantly a ected in thecourse of the transition(2) Increase in reputational risk
associated with investment andunderwriting related to businesses
with a heavy environmental load(3) Decrease in assets under management
resulting from a decline in the value of
assets held by funds(4) Increase in costs associated with thetightening of environmental
regulations and countermeasuresagainst disaster risk
(5) Decline in the value of assets held by
the Group and decrease in selling
opportunities

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Link

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Items

Recommended disclosures

Initiatives

Link

Risk
Management

Methods for identifying, assessing,and managing climate-related risksa) Processes for identifying andassessing climate-related risksb) Processes for managing climaterelated risksc) Integration of processes for
identifying, assessing, and managing
climate-related risks into overall risk
management

Identify, assess, and manage climaterelated risks

Supply Chain
Management
Daiwa AssetManagement Co.
Ltd. "About
Stewardship
Activities"
Daiwa AssetManagement Co.
Ltd. "ESG
Investment
Policy"(1) Consideration of analysis of the
impact of climate-related risks on
nancial and capital markets(2) When promoting new products or new
businesses, conduct appropriate
screening from the perspective of the
SDGs/ESG, including climate change
response(3) In the case of IPO projects,
underwriting examination is carriedout as a priority item not only forbusiness performance and nancial
aspects, but also for the issuer’s
business model, compliance systemand corporate governancedevelopment status, etc., from theperspective of ESG.
(4) The holding of dialogue on theenvironment and society by the AssetManagement Division with investee
companies. Discussions onenvironmental management policy,
promotion systems, information
disclosure, approach to external
evaluations, etc., especially withcompanies with a large environmentalload (References: Daiwa AssetManagement’s ESG investment Policy,
stewardship report)(5) Collect risk information veri edthrough the above processes andexternal environment analysis. The
SDGs Promotion Committee Considers
systems to identify important risks(6) Participate in various initiatives,
including UNEP-FI, to ascertain trends
of regulations and policies

Consider integrating climate-relatedrisks into existing risk management151

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Items

Recommended disclosures

Initiatives

Link

Metrics andTargets

Metrics and targets used to assess andmanage climate-related risks andopportunitiesa）Metrics for assessing climaterelated risks and opportunitiesb）Scope 1, Scope 2, and Scope 3
greenhouse gas (GHG) emissionsc）Targets used to manage climaterelated risks and opportunities

In-house monitoring of the following
metrics

SDGs Promotion
KPIs for FY 2020
(Japanese)
Daiwa Energy &Infrastructure Co.
Ltd.
Investment inGreen Gira e
SDGs Data Edition
2020(1) CO2 emissions (reduction of own
environmental load)(2) Investment in SDGs-related
businesses (renewable energy
business, etc.)(3) SDG bonds league table (Green Bonds,
etc.)(4) Renewable energy M&A league table

Disclose of Scope 1, Scope 2, andScope 3 greenhouse gas (GHG)
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Green Bonds
Until now, Daiwa Securities Group has sold various kinds of Impact Investment bonds, thereby supporting the solving of social issues
from the standpoint of a nancial institution. In November 2018, Daiwa Securities Group Inc. issued its rst Green Bonds, expanding its
initiatives aimed at invigorating markets. As part of such initiatives, the proceeds from the Green Bonds have been used as investment
and loan funds for renewable energy generation projects worked on by the Group, as well as facility funds for Green Buildings. The
Group will continue to contribute to achievement of SDGs and provide investors with new investment opportunities.

Information on Green Bonds Issued by Daiwa Securities Group Inc. (asof the end of June 2020)
1. Appropriation of Proceeds from Issuance

The proceeds from the Green Bonds issued by Daiwa Securities Group Inc. in November 2018 (issuance amount: ¥10 billion) were fully
appropriated for eligible Green Projects.
See the table below for the balance of investment and loans for eligible Green Projects by category.

List of Eligible Green Projects (as of the end of June 2020)
Category

Sub-category

Commencement of
Finance/Re nance

Finance/Re nance

Balance(units of ¥ billion)

Renewable energy

Photovoltaic power generation

November 2018

Re nance

1.3

Renewable energy

Photovoltaic power generation

November 2018

Finance

1.5

Renewable energy

Photovoltaic power generation

February 2019

Finance

1.9

Renewable energy

Photovoltaic power generation

June 2020

Finance

3.3

Green Building-

November 2018

Re nance

2.0

total

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2. Environmental Impact

As of the end of June 2020, the eligible Green Projects for which the proceeds from Green Bonds were appropriated have an energy
output/assumed energy output of 85,975 MWh. They have the e ect of reducing carbon dioxide (CO2) emissions by 40,236 t-CO2
annually.

Report on Environmental Impact (as of the end of June 2020)
Category

Sub-category

Energy output/
assumed energy output (MWh)Estimated CO2
emissions
reduction e ect (tCO2)

Renewable energy

Photovoltaic power
generation

85,97540,236

Category

Progress of application for certi cation

Green BuildingAwarded Five Stars in plan certi cation for the DBJ Green Building Certi cation Program* Calculation of environmental impact When no results have been obtained or the period of operation is less than one year, the assumed energy output iscalculated based on a report on energy output projections submitted by a third-party institution. For projects under development that are notscheduled to be brought into operation during FY , the assumed output for the rst year of operation is used. All power plants are scheduled to bebrought into operation by FY .

3. Annual Review by Independent provider of ESG research and analysis

A review by an independent provider of ESG research and analysis con rmed that the use of proceeds criteria and the reporting criteria
were met.
Annual Review by Sustainalytics

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ESG Information Index
Information on the Daiwa Securities Group is organized from the perspective of ESG surveys and other research.

General Management
Message from Management

Message from CEO

Corporate Philosophy and
Code of Conduct

Corporate Principles[Japanese] Daiwa Spirit [PDF: KB]
Management Policy
Policy on Communication with Stakeholders

SDGs as a Management
Strategy

Our Values and SDGs Materiality
Daiwa Securities Group’s SDGs Declaration
Structure of SDGs Promotion
Message from the Head of SDGs
SDGs Promotion Action Plan

Participation in Initiatives

Participation in Initiatives

External Evaluations

Third-Party Evaluations

Independent Assurance

Independent Assurance Report (SDGs Data Edition 2020) [PDF: . MB]

Initiatives through Business Activities(To achieve the SDGs and resolve ESG issues)
Thinking in the Securities
BusinessRole and Social Responsibilities of the Securities Business

How to think about
investing[Daiwa Securities Co.Ltd.] Acceptance of the Japanese version of the Stewardship Code(Japanese)

Mission of Financial Institutions toward Solving Social Issues

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SDGs report 2020

[Daiwa Asset Management Co.Ltd.] About the Company's stewardship activities(Policy on Stewardship Activities, Policy on the Exercise of Voting Rights)[Daiwa Asset Management Co.Ltd.] ESG Investment Policy (Japanese)[Daiwa Asset Management Co.Ltd.] Investment in cluster bomb manufacturing companies
and other treatment (Japanese)
Responsible Action as an Institutional Investor[Daiwa Real Estate Asset Management Co. Ltd.] Policy Regarding ESG
Responsibility to customers
and customer satisfaction

Basic Policy on Customer- rst Operations
Introduction of NPS®* (Net Promoter Score) Towards Realization of Quality No.
Improving In-Branch Customer Service Quality
Contact Center Functions
Working to Incorporate Customer Voices

Develop and Provide
Products

Impact Investment
SRI Investment Trusts
Daiwa Securities Group’s History of SRI Funds and SDG Bonds (Impact Investment Bonds)
Initiatives by the Asset Management Division
Response to FinTech and arti cial intelligence (AI)Daiwa Internet TV

Inclusion (Financial
Inclusion, etc.)

Promotion of Accessible Services for Diverse Customers
Myanmar SME/ Two-Step Loan Project for Agriculture and Rural Development
Private Equity Investment in Myanmar

Analysis andRecommendations for
Economic, Social andInvestment Information

Initiatives to Provide Information on ESG

Investing in Businesses that
Solve Social Problems

SDGs × “Technology”

Initiatives by Daiwa Institute of Research
Issuing Green Bonds
SDGs × “Local Community”
SDGs × “Life”
Initiatives Using Investment Corporations and Other Structures to Solve Social Issues
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Environment
Environmental
Management

Environmental Vision / Environmental Principles / Basic Environmental Policies
Environmental Management
Response to the TCFD
Targets for FY

E orts and Achievements in
Reducing Environmental
ImpactInitiatives to Reduce the Environmental Impact of Business Activities
Environmental Initiatives (Environmental Report/Accounting)[PDF: . MB]

Society
Employment and Working
Environment

Hiring Approaches and Trends
Guidelines for Fair Hiring
Intra-Group Job Postings and the Career Track Change System
Evaluation System
Employees at Daiwa Securities Group (Consolidated) (SDGs Data Edition 2020 Social Report)[PDF: . MB]
Average Number of Years of Service (SDGs Data Edition 2020 Social Report)[PDF: . MB]
Employee Turnover Statistics (SDGs Data Edition 2020 Social Report)[PDF: . MB]
Working Hours and Paid Vacation Usage Rate (SDGs Data Edition 2020 Social Report)[PDF: . MB]
Workforce Statistics

Diversity & Inclusion

Basic Policy for Initiatives Addressing Human Rights and Social Integration Issues
Recruitment of University Graduates
Support for the Success of Veteran Employees
Number of Employees Re-employed after Retirement Age (SDGs Data Edition 2020 Social
Report)[PDF: . MB]
Employment of People with Disabilities
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Diversity & Inclusion

Employment Rate for Persons with Disabilities(SDGs Data Edition 2020 Social Report)[PDF: . MB]
Encouraging Work-Life Balance (WLB)
Encouraging Women to Succeed[Daiwa Capital Markets America Inc.] WORK FOR US > Culture[Daiwa Capital Markets Europe Limited.] Diversity & Equality
Various Work-Life Balance Support Programs (SDGs Data Edition 2020 Social Report)[PDF: . MB]
Welfare Program Usage (SDGs Data Edition 2020 Social Report) [PDF: . MB]
Employees Taking Childcare Leave and Other Related Plans (SDGs Data Edition 2020 Social
Report)Initiatives for Work-Life Balance and Supporting Diverse Work Styles (SDGs Data Edition 2020
Social Report)

Employee Satisfaction

Communication with Employees
Work Motivation Survey (SDGs Data Edition 2020 Social Report)[PDF: . MB]

Internal Communication

Active Use of In-House Magazine
Communication among Employees
Initiatives for Families

Labor-Management
Dialogue

Relationship with Employee Unions

Human Resource
Development andCapability Development

Employee Training Approaches and Trends

Number of Employee Union Members (SDGs Data Edition 2020 Social Report)[PDF: . MB]

Education and Training System
Supporting Employees Trying to Earn Credentials

Human Rights

Basic Policy for Initiatives Addressing Human Rights and Social Integration Issues
Human Rights Education and AwarenessInitiatives in FY
Supply Chain Management and ESG Due Diligence including Human Rights[Daiwa Capital Markets Europe Limited.] Modern Slavery Act 2015

Health Management andOccupational Safety and
HealthHealth Management
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SDGs report 2020

Economic and Financial
Education

Education and Research Activities in Economics and Finance
Information Website for Child Rearing and Money “SODATTE” (Japanese)
Okane-no-Mikata (Japanese)
Daiwa Internet TV (Japanese)
Results in Economic and Financial Education Program (SDGs Data Edition 2020 Social
Report) [PDF: . MB]

Social Contribution
Activities and Corporate
Citizenship Activities

Assistance to Communities inside and outside of Japan through Foundations and NPOs
Initiatives for Child Poverty Issues
Support for Culture, the Arets, Sports Activities (Japanese)
Corporate Citizenship Initiatives[Daiwa Capital Markets America Inc.] Corporate Social Responsibility[Daiwa Capital Markets Europe Limited.] Corporate Social Responsibility
Corporate Citizenship Initiatives and Expenditures (SDGs Data Edition 2020 Social Report)[PDF: . MB]

GovernanceCorporate Governance

Basic Views on Corporate Governance
Policies for Selection of Candidates to Serve as Directors / Policies for Selection of Outside
Directors / Composition of Board of Directors [PDF: KB]
Compensation of Executives
Corporate Governance Report [PDF: KB]

Tax Corporate GovernanceTax Policy

Whistleblowing

Structure and Achievements of Whistleblowing System (Corporate Ethics Hotline)

Risk Management

Risk Management and Risk Appetite Framework
Risk Management System
Types of Risks to Be Managed / Managing Major Risks

Supply Chain Management

Business Continuity Plan (BCP)
Supply Chain Management and ESG Due Diligence including Human Rights
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Supply Chain Management[Daiwa Capital Markets Europe Limited.] Modern Slavery Act 2015

Compliance

Compliance System
Full Implementation of “Customer-First”
Summary of the Management Policy for Con ict of Interest

Prevention of Money
Laundering, etc.

Daiwa Securities Group’s Customer Inspection System

Anticorruption

Initiatives against Bribery and Corruption

Basic Policy on Avoiding Involvement with Anti-Social Forces
Political Contributions (SDGs Data Edition 2020 Social Report)[PDF: . MB]

IT Governance Structure

IT Governance Structure

Information Security

Systemic Risk Management
Privacy Policy
Information Security

Information Disclosure

Disclosure Policy

External Evaluation
Third-Party Evaluations

Third-Party Evaluations

independent Assurance

Independent Assurance Report (SDGs Data Edition 2020 Social Report) [PDF: . MB]

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Participation in Initiatives
Daiwa Securities Group has participated in, signed, and supports the initiatives described below to contribute to developing asustainable society.

Major Initiatives

The United Nations Global Compact (UNGC)

Daiwa Securities Group Inc. signed the UNGC in January 2010. We support
the following 10 principles and work to contribute to sustainable
development in the international community.
10 principles
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 abuses.

LabourPrinciple 3: Businesses should uphold the freedom of association and thee ective recognition of the right to collective bargaining;
Principle 4: the elimination of all forms of forced and compulsory labour;
Principle 5: the e ective abolition of child labour; andPrinciple 6: the elimination of discrimination in respect of employment andoccupation.

The 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 di usion of environmentallyfriendly technologies.

Anti-corruption

Principle 10: Businesses should work against corruption in all its forms, including
extortion and bribery.

The United Nations-supported Principles for
Responsible Investment (PRI)

Daiwa Asset Management became a signatory in May 2006. PRI is a set ofsix principles launched by the United Nations Environment Programme Finance Initiative and the UN Global Compact. This initiative asks
institutional investors to incorporate ESG into their investment decision
making practices. Daiwa Securities Group will continue promoting
responsible investment.

The OECD Guidelines for Multinational Enterprises
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SDGs report 2020

ISO
The Charter of Corporate Behavior of Keidanren (Japan Business Federation)
Japan's Stewardship Code ("Principles for Responsible Institutional Investors")

Environmental initiatives
United Nations Environment Programme Finance Initiative (UNEP-FI)

Daiwa Securities Group Inc. became a signatory in May 2018. In
collaboration with nancial institutions, policymakers, and regulatory
authorities, UNEP-FI works to advance a shift to a nancial system thattakes economic development and ESG into consideration. As a nancial
institution, Daiwa Securities Group will promote collaboration in theinternational community to address environmental issues.

Task Force on Climate-related Financial
Disclosures (TCFD)

This is a task force established by the Financial Stability Board (FSB) in
2015. TCFD asks companies to grasp and disclose information on theimpact of climate change on nances during the course of a shift to a lowcarbon economy. Daiwa Securities Group Inc. announced its support for
TCFD in April 2018 and also participates in the TCFD Consortium,
established in May 2019 in Japan.

CDP

CDP is a project in which institutional investors interested in climatechange collaborate and require global companies to disclose informationon their attitudes and approaches to environmental issues.
We announced its support for the project in 2004.

Principles for Financial Action for the stCentury

Based on the recommendations of the Central Environment Council of the
Ministry of the Environment, this is an action guideline for nancial
institutions that was established with the aim of expanding the circle ofenvironmental nance e orts.
The Group has been actively involved since the drafting stage of thisprinciple, and signed in 2011 when it was established.

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Registration System of Green Bond Issuance
Supporters

The Financial Support Programme for Green Bond Issuance implemented
by the Ministry of the Environment subsidizes the external costs incurred
other than the cost for the ordinary bond issuance procedure. It grants a
subsidy to those who provide issuance support to green bond issuers(issuance supporters) for their issuance support costs. The Ministry has
established a system for announcing the issuance supporters on the“Platform for promoting Green Bond issuance.”
The Group has been a registered supporter since the initiation of thesystem in 2018.

Climate Bonds Partners ProgrammeThis is a program operated by Climate Bonds Initiative.* The program isjoined by Climate Bonds Partners, who support the development of green
bonds that contribute to climate change responses and low-carbon
investment.
The Group joined the program in March 2020.
* Climate Bonds Initiative (CBI):CBI is an international NGO that promotes large-scale investment in a low-carbon
economy. Aiming to use the $100 trillion bond market to combat climate change,
CBI has created the Climate Bond Standard (CBS) as a screening tool for investors
and governments when they make low-carbon investments. It also provides
periodic reports on the green bond market, policy models, and advice.

Diversity initiatives
30% Club JapanIn May 2019, the Chairman of the Board and President and CEO of Daiwa
Securities Group Inc. started to participate in the 30% Club Japan as
members in support of its activities. The 30% Club, established in the U.K.
in 2010, is a worldwide campaign aimed at increasing the ratio of women in
executive positions to promote the sustainable development ofcompanies. It has been rolled out in 14 countries and regions including
Japan, greatly contributing to a rise in the ratio of female executives.

Human rights initiatives
The United Nations Guiding Principles on Business and Human Rights
Children’s Rights and Business Principles

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Labor management initiatives
The eight fundamental conventions of the International Labour Organization

Governance initiatives
Japan's Corporate Governance Code established by Tokyo Stock Exchange164

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Third-Party Evaluations
Dow Jones Sustainability Indices
The Dow Jones Sustainability Indices (DJSI) are stock indices of companies with sustainable
practices selected by Dow Jones & Company, Inc. of the United States and RobecoSAM AG of
Switzerland. Daiwa Securities Group Inc. is a constituent of DJSI World. Since DJSI World waslaunched in 1999, it has continually been included in DJSI World and DJSI Asia Paci c.
Dow Jones Sustainability Indices

FTSE Indices
FTSE is a subsidiary of the London Stock Exchange. It develops global indexes and provides data forinvestment.
Daiwa Securities Group Inc. has been included in the FTSE Good, an index of socially responsible
companies compiled by FTSE, for 15 consecutive periods since September 2006.
Daiwa Securities Group Inc. has also been selected as a constituent of the FTSE Blossom Japan
Index for four consecutive periods since July 2017. This index is used as an ESG passive
management benchmark by the Government Pension Investment Fund.
FTSE Russell
FTSE Blossom Japan Index

MSCI Indices
MSCI measures and publishes various indices.
Daiwa Securities Group Inc. has been selected as a constituent of the MSCI Japan Empowering
Women Index for three consecutive periods since July 2017.
This index is used as an ESG passive management benchmark by the Government Pension
Investment Fund.
MSCI

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Nadeshiko Brand
Daiwa Securities Group Inc. has been selected as a “Nadeshiko Brand” for six consecutive years
since FY . This title is awarded by the Ministry of Economy, Trade and Industry and the Tokyo
Stock Exchange to listed companies for having excellent track records in empowering women in
their companies. We have been actively supporting the success of women for more than 10 years
and set targets related to initiatives for empowering women in 2015. We have helped women tobalance work and child-rearing while providing them with career support. As a result of thesecontinuous e orts to develop an environment enabling female employees to work energetically fora long time even after going through life events, an increasing number of female employees invarious life stages are playing active roles in their workplace. The number of female managers has
increased approximately vefold across the Group from the level before the implementation ofthese initiatives, with three women now serving as directors of Daiwa Securities Group Inc.
Nadeshiko Brand (Ministry of Economy, Trade and Industry website)

Health & Productivity Stock Selection
Daiwa Securities Group Inc. has been selected as a "Health & Productivity Stock Selection" for six
consecutive years since FY . This title is awarded jointly by Japan's Ministry of Economy, Tradeand Industry and the Tokyo Stock Exchange to companies promoting the health of their employees.
We appoint a Chief Health O cer (CHO) and hold Health Management Promotion Meetings once
every quarter as part of our e orts to enhance our health promotion system. We have also
introduced the KA-RA-DA iki-iki Project and an employment support plan for employees with cancer
which supports the balancing of work and cancer treatment, as well as the Daiwa ELLE Plan which
provides comprehensive support for addressing health issues speci c to women. These various
initiatives have been highly evaluated.
Health & Productivity Stock Selection (Ministry of Economy, Trade and Industry website)

Digital Transformation Stock (DX Stock)
In August 2020, Daiwa Securities Group Inc. was selected as a “Digital Transformation Stock (DXStock)” under the DX Stock Selection program operated jointly by the Ministry of Economy, Tradeand Industry of Japan and the Tokyo Stock Exchange (TSE). The title is awarded to companies for
actively working on digital transformation that enhances corporate value and competitiveness fromthe perspective of medium- to long-term corporate management.
This marks our third consecutive year of recognition, if the “Competitive IT Strategy Company” title
awarded under the predecessor program is included. This also means that we were selected for all
three titles available under the program for three years in a row. The program changed the title“Competitive IT Strategy Company” to “DX Stock” to put focus on digital transformation. It selects,
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from among companies listed on the TSE, companies that actively promote digital transformation,
thereby introducing appealing companies to investors who put emphasis on enhancement ofcorporate value from a medium- to long-term perspective. At the same time, it also aims toencourage companies to take initiatives for digital transformation.
We completed the distribution of mobile devices for work to all employees of Daiwa Securities, amajor subsidiary, by February 2020 and thus developed a working environment enabling them towork comfortably at anytime and anywhere. This initiative, along with the establishment of
CONNECT, a new brand aimed at attracting asset building generations, were highly evaluated.
Digital Transformation Stocks (Ministry of Economy, Trade and Industry website)"Kurumin" and "Platinum Kurumin" -Certi ed as a Family-Friendly
Employer
The certi ed family-friendly employer logo (nicknamed "Kurumin") is the certi cation symbol forfamily-friendly employers provided by Japan's Ministry of Health, Labour and Welfare, based on the
Act on Advancement of Measures to Support Raising Next-Generation Children. Daiwa Securities
Group Inc. obtained certi cation as a family-friendly employer on June 9, 2008, and Daiwa
Securities, Daiwa Institute of Research Holdings, Daiwa Institute of Research, Daiwa Institute of
Research Business Innovation, and Daiwa Securities Business Center have also been certi ed.
Moreover, as of March 11, 2016, Daiwa Securities and Daiwa Securities Business Center received a"Platinum Kurumin" certi cation. That certi cation is given to especially excellent companies
among the certi ed family-friendly employers that have implemented higher levels of initiatives.
Certi ed as a Family-Friendly Employer (Ministry of Health, Labour and Welfare website)"Tomonin"-Logo for Promoting Work Environments for Balancing Work with LongTerm Care
Daiwa Securities Group has continually built a working environment where employees can nd it
easy to use work-life balance support programs, in an e ort to help them to continue working whilebalancing work and nursing care. The Ministry of Health, Labour and Welfare conferred the logo
(nicknamed "Tomonin") on us for promoting the provision of a working environment favorable forbalancing work with long-term care.
Logo for Promoting Work Environments for Balancing Work with Long-Term Care(Ministry of
Health, Labour and Welfare website)

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GRESB 2019 "Green Star"
In the Global Real Estate Sustainability Benchmark (GRESB) Survey, Daiwa O ce Investment
Corporation has received the Green Star, the highest category of recognition, for eight consecutive
years (Four Star in FY ). Daiwa Securities Living Investment Corporation has also received theGreen Star for two consecutive years (Three Star in FY ).
GRESB "Green Star"(Green Building Japan website)

ISO Certi cation
ISO 14001
Daiwa Institute of Research Business Innovation has received ISO 14001 certi cation, which is an international standard forenvironmental management systems. Through its business activities, Daiwa Institute of Research Business Innovation has
endeavored to realize a harmonious relationship with the global environment, and actively works to reduce the environmental load.
ISO 27001
Daiwa Institute of Research (Systems Management Division) and Daiwa Institute of Research Business Innovation (Systems
Management Division and Systems Consulting Division, Social Insurance Customer Support Department, and BPO Center) havereceived ISO 27001 certi cation, which is an international standard for information security management systems. In order tomaintain and manage the con dentiality, integrity, and availability of their information assets, both companies are continuing to
improve their information security.
ISO 27017
Daiwa Institute of Research (Systems Management Division) and Daiwa Institute of Research Business Innovation (Systems
Management Division) have received ISO 27017 certi cation, which is an international standard for information security in relation to
cloud services. As an add-on certi cation to ISO 27001, ISO 27017 deals with information security speci c to cloud services.
ISO 20000
Daiwa Institute of Research (Systems Management Division) and Daiwa Institute of Research Business Innovation (Systems
Management Division) have received ISO 20000 certi cation, which is an international standard for IT service management systems.
In order to provide customers with a high-quality IT service in a stable manner, both companies are engaged in organizational
enhancement of the quality of their IT services, including cost management, business process optimization, and continual
improvements.
ISO website
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GRI Content Index
Our report refers GRI Standards 2016 of the Global Reporting Initiative (GRI).

Universal Standards
Organizational Pro le
Number

Disclosures

Applicable web page

102-1

Name of the organization.

Corporate Pro le102-2

Activities, brands, products, and services

Corporate Pro le102-3

Location of headquarters

Corporate Pro le102-4

Location of headquarters

Corporate Pro le102-5

Ownership and legal form

Corporate Pro le102-6Markets served

Corporate Pro le
Management policy

102-7

Scale of the organization

Corporate Pro le102-8

Information on employees and other workers

Corporate Pro leSDGs Data Edition 2020

102-9

Supply chain

Corporate Pro le
Supply Chain Management
Role and Social Responsibilities of the
Securities Business
Risk Management102-10Signi cant changes to the organization and its
supply chain

Corporate Pro leRole and Social Responsibilities of the
Securities Business169

SDGs report 2020

Number

Disclosures

Applicable web page102-11

Precautionary Principle or approach

Corporate GovernanceCompliance
Risk Management
IT Strategy and Management of Systemic Risk

102-12External initiatives

Participation in Initiatives

102-13

Membership of associations

Participation in Initiatives

Strategy
Number

Disclosures

Applicable web page102-14

Statement from senior decision-maker

Message from the CEO

102-15Key impacts, risks, and opportunities

Our Values and SDGs Materiality

Ethics and Integrity
Number

Disclosures

Applicable web page102-16

Values, principles, standards, and norms of
behavior

Our Values and SDGs Materiality

102-17

Mechanisms for advice and concerns about
ethicsCorporate Governance

Governance
Number

Disclosures

Applicable web page102-18Governance structure

Corporate Governance102-19Delegating authority

Our strategy for achieving SDGs

102-20Executive-level responsibility for economic,
environmental, and social topics

Our strategy for achieving SDGs

102-21

Consulting stakeholders on economic,
environmental, and social topics

Communication with Stakeholders
Our strategy for achieving SDGs
Corporate Governance170

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Number

Disclosures

Applicable web page102-22Composition of the highest governance bodyand its committees

Corporate Governance102-23Chair of the highest governance body

Corporate Governance102-24

Nominating and selecting the highest
governance body

Corporate Governance102-25Con icts of interest

Corporate Governance102-26

Role of highest governance body in setting
purpose, values, and strategy

Corporate Governance102-27

Collective knowledge of highest governancebody

Our strategy for achieving SDGs
Management policy

102-28

Evaluating the highest governance body's
performance102-29Identifying and managing economic,
environmental, and social impacts

Our strategy for achieving SDGs

102-30E ectiveness of risk management processes

Our strategy for achieving SDGs

102-31

Review of economic, environmental, and social
topics

Our strategy for achieving SDGs

102-32Highest governance body's role in sustainability
reportingOur strategy for achieving SDGs

102-33

Communicating critical concerns

Our strategy for achieving SDGs
Corporate Governance102-34Nature and total number of critical concerns

Corporate Governance102-35

Remuneration policies

Corporate Governance
SDGs Data Edition 2020

102-36

Process for determining remuneration

Corporate GovernanceCorporate Governance Report102-37

Stakeholders' involvement in remuneration

Corporate Governance102-38Annual total compensation ratio-

102-39Percentage increase in annual totalcompensation ratio

-

171

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Stakeholder Engagement
Number

Disclosures

Applicable web page102-40

List of stakeholder groups

Communication with Stakeholders

102-41

Collective bargaining agreements

Communication with Employees
SDGs Data Edition 2020

102-42

Identifying and selecting stakeholders

Communication with Stakeholders

102-43

Approach to stakeholder engagement

Communication with Stakeholders

102-44

Key topics and concerns raised

Our Values and SDGs Materiality
Communication with Stakeholders

Reporting Practice
Number

Disclosures

Applicable web page102-45

Entities included in the consolidated nancial
statements

Corporate Pro le102-46

De ning report content and topic Boundaries

Editorial Policy

102-47

List of material topics

Our strategy for achieving SDGs

102-48

Restatements of information

Not Applicable

102-49Changes in reporting

Our strategy for achieving SDGs

102-50

Reporting period

Editorial Policy

102-51

Date of most recent report

Editorial Policy

102-52

Reporting cycle

Editorial Policy

102-53

Contact point for questions regarding the report

Editorial Policy

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

Editorial Policy

102-55

Content index

Content index

102-56External assurance

SDGs Data Edition 2020

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103 Management Approach
Number

Disclosures

Applicable web page

103-1

Explanation of the material topic and its
Boundary

Our strategy for achieving SDGs

103-2

The management approach and its components

Our strategy for achieving SDGs

103-3

Evaluation of the management approach

Our strategy for achieving SDGs

Standards by Topic
Economic
Number

Disclosures

Applicable web page201: Economic Performance
201-1

Direct economic value generated anddistributed

Disclosure Report 2020 (only Japanese)

201-2

Financial implications and other risks andopportunities due to climate change

TCFD

201-3

De ned bene t plan obligations and otherretirement plans

Disclosure Report 2019 (only Japanese)

201-4

Financial assistance received from government

Impact is insigni cant202-1

Ratios of standard entry level wage by gendercompared to local minimum wage

Impact is insigni cant, due to the nature of ourbusiness

202-2

Proportion of senior management hired fromthe local community-

202: Market Presence

203: Indirect Economic Impacts
203-1

Infrastructure investments and services
supported

Action through Product Development andDistribution
Support for Creating Our Future Society
Action with NPOs

203-2

Signi cant indirect economic impacts

Not applicable173

SDGs report 2020

Number

Disclosures

Applicable web page204: Procurement Practices
204-1

Proportion of spending on local suppliers

Impact is insigni cant, due to the nature of ourbusiness

205-1

Operations assessed for risks related tocorruption

Compliance
Risk Management

205-2

Communication and training about anticorruption policies and proceduresCompliance

205-3

Con rmed incidents of corruption and actions
taken

Not applicable

205: Anti-corruption

206: Anti-competitive Behavior
206-1

Legal actions for anti-competitive behavior,anti-trust, and monopoly practices

Not applicable

Environmental
Number

Disclosures

Applicable web page301: Materials
301-1

Materials used by weight or volume

Not applicable

301-2

Recycled input materials used

Not applicable

301-3

Reclaimed products and their packaging
materials

Not applicable

302-1

Energy consumption within the organization

SDGs Data Edition 2020

302-2

Energy consumption outside of the organization

SDGs Data Edition 2020

302-3

Energy intensity

SDGs Data Edition 2020

302-4

Reduction of energy consumption

SDGs Data Edition 2020

302-5

Reductions in energy requirements of products
and services

SDGs Data Edition 2020

302: Energy

303: Water and E uents (2018)174

SDGs report 2020

Number

Disclosures

Applicable web page303-1

Interactions with water as a shared resource

Impact is insigni cant, due to the nature of ourbusiness

303-2

Management of water discharge-related
impacts

Impact is insigni cant, due to the nature of ourbusiness

303-3

Water withdrawal

SDGs Data Edition 2020

303-4

Water discharge

-

303-5

Water consumption

-

304-1

Operational sites owned, leased, managed in, or
adjacent to, protected areas and areas of highbiodiversity value outside protected areas

Not applicable304-2

Signi cant impacts of activities, products, andservices on biodiversity

Not applicable

304-3

Habitats protected or restored

Not applicable

304-4

IUCN Red List species and national conservation
list species with habitats in areas a ected byoperations

Not applicable

305-1

Direct GHG emissions

Environmental Activities
SDGs Data Edition 2020

305-2

Energy indirect GHG emissions

Environmental Activities
SDGs Data Edition 2020

305-3

Other indirect GHG emissions

Environmental Activities
SDGs Data Edition 2020

305-4

GHG emissions intensity

Environmental Activities
SDGs Data Edition 2020

305-5

Reduction of GHG emissions

Environmental Activities
SDGs Data Edition 2020

305-6

Emissions of ozone-depleting substances (ODS)

Impact is insigni cant, due to the nature of ourbusiness

305-7

Nitrogen oxides (NOX), sulfur oxides (SOX), andother signi cant air emissions

Impact is insigni cant, due to the nature of ourbusiness

304: Biodiversity

305: Emissions

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Number

Disclosures

Applicable web page306-1

Water discharge by quality and destination

Impact is insigni cant, due to the nature of ourbusiness

306-2

Waste by type and disposal method

Environmental Activities
SDGs Data Edition 2020

306-3

Signi cant spills

Not applicable

306-4

Transport of hazardous waste

Not applicable

306-5

Water bodies a ected by water discharges
and/or runo

Not applicable

306: E uents and Waste

307: Environmental Compliance
307-1

Non-compliance with environmental laws andregulations

Not applicable

308: Supplier Environmental Assessment
308-1

New suppliers that were screened using
environmental criteria

Not applicable308-2

Negative environmental impacts in the supply
chain and actions taken

Not applicable

Society
Number

Disclosures

Applicable web page

401: Employment
401-1

New employee hires and employee turnover

SDGs Data Edition 2020

401-2

Bene ts provided to full-time employees thatare not provided to temporary or part-time
employees

Creating a rewarding workplace

401-3

Parental leave

Creating a rewarding workplace
SDGs Data Edition 2020

402: Labor/Management Relations
402-1

Minimum notice periods regarding operationalchanges403: Occupational Health and Safety (2018)176-

SDGs report 2020

Number

Disclosures

Applicable web page403-1

Occupational health and safety management
systemWork-Life Balance
Health Management403-2

Hazard identi cation, risk assessment, andincident investigation

403-3

Occupational health services

Work-Life Balance
Health Management

403-4

Worker participation, consultation, andcommunication on occupational health andsafetyWork-Life Balance
Health Management

403-5

Worker training on occupational health andsafety403-6

Promotion of worker health403-7

Prevention and mitigation of occupational
health and safety impacts directly linked bybusiness relationships

403-8

Workers covered by an occupational health andsafety management system

403-9Work-related injuries

403-10Work-related ill healthWork-Life Balance
Health Management404: Training and Education
404-1

Average hours of training per year per employee

Human Resource Development and Skill
Enhancement

404-2

Programs for upgrading employee skills andtransition assistance programs

Human Resource Development and Skill
Enhancement

404-3

Percentage of employees receiving regularperformance and career development reviews

405: Diversity and Equal Opportunity
405-1

Diversity of governance bodies and employees

SDGs Data Edition 2020

405-2

Ratio of basic salary and remuneration of
women to men

SDGs Data Edition 2020

406: Non-discrimination
177

SDGs report 2020

Number406-1

Disclosures

Applicable web page

Incidents of discrimination and corrective
actions taken

Not applicable due to the nature of our business

407: Freedom of Association and Collective Bargaining
407-1

Operations and suppliers in which the right tofreedom of association and collective
bargaining may be at risk

Not applicable due to the nature of our business

Operations and suppliers at signi cant risk forincidents of child labor

Not applicable due to the nature of our business

408: Child Labor
408-1

409: Forced or Compulsory Labor
409-1

Operations and suppliers at signi cant risk forincidents of forced or compulsory labor

Not applicable due to the nature of our business

Security personnel trained in human rights
policies or procedures

Impact is insigni cant, due to the nature of ourbusiness

410: Security Practices
410-1

411: Rights of Indigenous Peoples
411-1

Incidents of violations involving rights ofindigenous peoples

Not applicable due to the nature of our business

412: Human Rights Assessment
412-1

Operations that have been subject to humanrights reviews or impact assessments

Risk Management

412-2

Employee training on human rights policies orprocedures

Human Rights Initiatives

412-3

Signi cant investment agreements andcontracts that include human rights clauses orthat underwent human rights screening

Risk Management

413-1

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

Impact is insigni cant, due to the nature of ourbusiness

413-2

Operations with signi cant actual and potential
negative impacts on local communities

Impact is insigni cant, due to the nature of ourbusiness

413: Local Communities

414: Supplier Social Assessment
178

SDGs report 2020

Number

Disclosures

Applicable web page414-1

New suppliers that were screened using social
criteria

Not applicable

414-2

Negative social impacts in the supply chain andactions taken

Not applicable

Political contributions

SDGs Data Edition 2020

415: Public Policy
415-1

416: Customer Health and Safety
416-1

Assessment of the health and safety impacts ofproduct and service categories

Not applicable due to the nature of our business

416-2

Incidents of non-compliance concerning thehealth and safety impacts of products andservices

Not applicable due to the nature of our business

417: Marketing and Labeling
417-1

Requirements for product and service
information and labeling

Providing Quality Service to Customers

417-2

Incidents of non-compliance concerning
product and service information and labeling

Not applicable

417-3

Incidents of non-compliance concerningmarketing communication

Not applicable

Substantiated complaints concerning breachesof customer privacy and losses of customer data

Not applicable

418: Customer Privacy
418-1

419: Socioeconomic Compliance419-1

Non-compliance with laws and regulations inthe social and economic area

179

Not applicableSDGs report 2020

Editorial Policy
Daiwa Securities Group's policy on information disclosure regarding the SDGs is as follows.

Editorial Policy
At Daiwa Securities Group, we have been reporting our CSR activities annually since FY for the following two objectives: todisclose our CSR activities in an easy-to-understand way and to evaluate the current state of a airs and the challenges we face. Fromthe second half of FY , our CSR activities were expanded as part of our initiatives for achieving SDGs. In conjunction with thischange, we sorted out our business activities and the content of the Group's CSR activities anew, and redesigned our previous CSR
Report into the SDGs Data Book.
From scal 2020, we will post comprehensive data on the Group's SDGs on the "SDGs" page of the Daiwa Securities Group's web sitewith the aim of improving the convenience of readers and timely disclosure of information.
Intended ReadershipThis report is intended for the broad range of Daiwa Securities Group stakeholders de ned
by ISO 26000, including customers, shareholders and investors, employees, business
partners, and local communities.

Reporting Boundary

This report generally discusses the principal companies of Daiwa Securities Group. It does
not, however, include all data from the Group's principal companies on items reported. The
information is selected based on the respective companies' size and type of business. Eachset of data speci es the scope of coverage. The term "Daiwa Securities Group" refers to ourentire group, while the terms "Daiwa Securities Group Inc." and "Daiwa Securities" refer to
Daiwa Securities Group Inc. and Daiwa Securities Co. Ltd., respectively.

Period Covered by
ReportFY (April 1, 2019, to March 31, 2020) The report, however, also includes some
information on events and activities carried out prior to the beginning of or after the end of
FY , or scheduled to take place during FY

Inquiries

SDGs Promotion O ce, Corporate Planning Department, Daiwa Securities Group Inc.

Tel

+81-3-5555-1111(Main)

E-maildaiwacsr@daiwa.co.jp

URL

https://www.daiwa-grp.jp/english/sdgs/group_sdgs/

Reference Guidelines

GRI Sustainability Reporting Standards
ISO 26000: Guidance on social responsibility
Sustainability accounting standards for the Financials sector, Sustainability AccountingStandards Board (SASB)
Environmental Accounting Guidelines 2005, Ministry of the Environment, Japan180

SDGs report 2020

For Deeper Understanding of Corporate Activities of Daiwa Securities GroupAt Daiwa Securities Group, we issue an Integrated Report, referring to the International Integrated Reporting Framework published by
the International Integrated Reporting Council (IIRC) and the Guidance for Collaborative Value Creation of the Ministry of Economy,
Trade and Industry. The Integrated Report is aimed at communicating the Group’s history and current and future value creation
activities to our stakeholders in an easy-to-understand way, and we select important matters and initiatives taken mainly in the past
one year as information to be posted.
Please look at the Report along with this website.

Integrated Report181