External Directors’
Roundtable Discussion

DIALOGUE
Three external directors talk about their assessment of theGroup’s governance, the effectiveness of Board of Directors
meetings, and the process for selecting a new chairman
and president.

Yoshio Mogi
Director (Audit & Supervisory Committee Member)
Member of the Advisory Committee Relating toNominations and Compensation

Discussions at Board of Directors Meetings in
the Fiscal Year Ended March 2023
Takahashi Because this was the first year of the new Mid- to Longterm Business Plan (the “plan”), I recognize that the first priority was toachieve and exceed performance forecasts. I feel that the Company
got off to a start appropriate for the first year by exceeding performance forecasts and achieving record-high profit.
At Board of Directors meetings, although sincere discussions arestill being held, discussions tend to be focused on individual projects
because the Board of Directors has the duty to decide on important
proposals. The Company fully recognizes this issue and is working
hard to enhance effectiveness of the Board of Directors while utilizing
opportunities besides Board meetings, including holding opinion
exchange meetings to discuss such themes as Company-wide targets and medium- to long-term strategies as well as inviting external
lecturers for director training to deepen knowledge of timely themes.
A primary example of what was discussed at Board of Directors
meetings in the previous fiscal year, ended March 2023, is the capitaland business alliance with YARUKI Switch Group Holdings Co., Ltd.
Considering the Group’s business expansion to date, some directors
were initially dubious about the alliance with said company, which is
involved in the education business. But after many discussions were
held at Board meetings from various perspectives, we ultimately
arrived at the decision that we should go through with this alliance. I
want to take on more new challenges like this.
Mogi With a very strong business performance, the Overseas
Business Unit grew the most despite still being small monetarily speaking. Going forward from this fiscal year, ending March 2024, I am reallylooking forward to how the overseas business will continue to grow.
At the same time, because risks are rising around the world, I think
we need to further enhance discussions in the current fiscal year
about how we can increase the effectiveness of risk management andcompliance assurance in the overseas business. Careful attention willneed to be paid to these efforts because it is inherently difficult tomonitor the overseas business from within Japan.
If the strong performance continues like it is now, it could be interpreted that there are few errors being made; however, in other words,
it could also be a concern that there are few new challenging
endeavors. I think we should always maintain the mindset that errors
will not be made if more new challenges are not undertaken.
Miyakawa It has been four full years since I became a director. The
atmosphere at Board meetings fosters dialogue, and I strive to

62

Nomura Real Estate Holdings, Inc.

communicate points and observations from my own unique perspective
distinct from everyone else.
In this fiscal year, regarding business resource allocation to eachBusiness Unit, the main theme of discussion was how to progresswith selection and concentration. In addition, the Board held quite afew discussions on diversity and inclusion, the utilization of humanresources, and wellness.
Amid these circumstances, I have continued to give my opinion
based on my expertise as a certified public accountant, but I also
strive to speak from my perspective as a woman and as a regularmember of society.

The Composition of the Board of Directors
Miyakawa I believe that the current composition of the Board of
Directors is balanced and really good. I was the only woman on the
Board in the fiscal year ended March 31, 2023, but with the additionof Ms. Takakura in June 2023, there are now two, and I strongly
applaud this. Because Ms. Takakura is well versed in matters related
to human resources, I look forward to having deeper discussions onhuman capital at Board meetings. In addition, in the near future, I
think more women will need to be promoted to director from within
the Company.
Takahashi I look forward to Ms. Takakura’s advice from her broad
perspective, on such subjects as employee compensation and development. I think every employee has worked hard to help gain trustfrom customers and build up the Company’s brand power. I would
like to hear her indicate places that need improvement, including thework environment, in order to fully utilize employees’ capabilities.
Mogi From the perspective of supplementing the current functions of
the Board of Directors, I believe people with experience in top management will likely be necessary. I, myself, have previously worked asa vice president and can say that the wealth of experience gained andthe scale of responsibility borne by members of top management are
different than for those in other positions. From its higher vantage point,
top management can view the future from a much broader perspective,
and their experience and expertise should provide major revelations
for the Board of Directors.
Regarding the addition of Ms. Takakura, I look forward to hercomments related to the necessity of recruiting foreign nationals,
especially managers, as well as enhancing the process after they join
the Company. This is because, from the perspective of diversity on

Introduction

Our Vision(To be)Our Current Strengths and Core(Strengths)

Akiko Miyakawa

Our Challenges and Strategies(Actions)

The Foundation of Our Activities(Base)

Data, etc.

Tetsu Takahashi

Director(Audit & Supervisory Committee Member)

Director(Audit & Supervisory Committee Member)
Chair of the Advisory Committee Relating toNominations and Compensation

the Board of Directors, I think thorough discussion is needed regarding the necessity of appointing not only women, of course, but also
foreign nationals going forward.

Striving to Achieve Win-Win Relationships withMajor Shareholders

Enhancing the Effectiveness of the Boardof Directors
Miyakawa A board of directors that just quietly approves proposals
after someone gives an explanation cannot be said to be highly
effective. It is important that the Board hold extensive and thoroughdiscussions after receiving a variety of opinions, including dissenting
ones, then gain consensus on the direction that should be taken.
The Board currently holds discussions after making thoroughpreparations by utilizing opinion exchange meetings, which director
Takahashi mentioned. I think it is safe to say this current situation ishighly effective.
Mogi From a similar perspective, I also think controlled conflict isnecessary. For example, when deliberating a real estate development
project, discussions are participated in by not only directors who havebeen working at Nomura Real Estate since graduating from university,
but also us, the external directors. And, sometimes, the opinions
expressed clearly state we should strongly step on the brakes. To
steadily maintain this situation, I think it is important that there bediversity in the expertise and experience of directors.
Takahashi The word effectiveness is actually abstract. Does it meanthat very lively discussions are held? Or that even when a proposal isrepeatedly rejected, it gets proposed again? Or that proposals arecontinuously accepted? Considering that the Board of Directors is the
final step in the Company’s decision-making process, I think it isimportant how discussions are enhanced before getting to that final
stage. As an external director, it is crucial that I see what executiveside directors overlook and reconfirm it through thorough discussion.
It could also sometimes be necessary even after that confirmation to
give encouragement to executive-side directors.
To fully leverage those kinds of functions and enhance theeffectiveness of the Board of Directors, I believe it is indispensable toenhance the quality of each director, of course, but also the diversityof Board members, by seeking out individuals possessing management
experience and experts in various fields.

Takahashi One of the characteristics of the Company’s governance isthe presence of Nomura Holdings as a major shareholder, and I amaware that, in light of this fact, protecting the profit of minority shareholders is a very important issue. This perspective must always be
kept in mind during discussions at Board of Directors meetings.
Fair decisions should be made that are fully accepted by minority
shareholders, and highly transparent disclosure must be assured
regarding those decisions.
However, the connection between the real estate and securities
industries has become increasingly strong recently. In particular, in the
Company’s investment management business and property brokerage& CRE business, we can achieve strong synergy with Nomura
Holdings. Thinking carefully about whether the Group is fully utilizing thissynergy will contribute to the overall profit of shareholders, including
minority shareholders.
Mogi Even though the Company is young, it being around 17 years
since its listing on the stock exchange, its business results have significantly grown. The real estate business has grown closer to thefinancial world, and I think the Company is capable of more fully utilizing the fact that Nomura Holdings, which has a major presence infinance, is a major shareholder. Ideally, the Company’s top management would lead this effort. The environment is already in place tobuild a win-win relationship.
Miyakawa In the previous fiscal year, the Company and Nomura
Holdings jointly established Nomura Real Asset Investment. I supported the establishment of the joint company upon confirming that bothcompanies could create synergy, that there are stories enabling themutual enhancement of corporate value, and that fair procedures arein place. I think an important role for us external directors is tocontinue to monitor this relationship.

Selection Process of the New Management Structure
Takahashi With people from the major shareholder serving as chairand president, there were various discussions held on how governance would function. I understand that we should always maintainthis kind of perspective.
Speaking as the chair of the Advisory Committee Relating toNominations and Compensation, who submits candidates, we did not
Integrated Report 2023

63

External Directors’ Roundtable Discussion

select the new management because they are from our major shareholders. At meetings of this Committee and the Board of Directors,
decisions on the selection of a new chair and president were reachedin the course of serious discussion for pursuing the ideal structure forrealizing the Mid- to Long-term Business Plan.
CEO Arai, who assumed the position of president in April 2023, listens carefully to the various opinions and assessments of each business
unit, and I feel he aims to base his opinions on thorough rational discussion. For each proposal, I would like to make progress toward finding
good judgments through these kinds of highly detailed discussions.
Mogi The profit of a major shareholder was not prioritized at the timeof the selection of the new CEO.
The Advisory Committee Relating to Nominations and Compensation
held individual interviews and considered documents for multiple candidates, held multiple discussions, and evaluated such items as
ambitious spirit and negotiating ability. The committee selected CEO
Arai, who was highly evaluated on many of the items.
I look forward to seeing how he assesses and controls risks whileleveraging his financial and market knowledge cultivated in the securities industry. I also look forward to the sense of balance and to his
management utilizing the negotiating ability he refined with his extensive
sales experience.
Takahashi CEO Arai became a director of the Company in June 2022
and was selected as CEO about a year later. I mostly focused on his
qualities to achieve the Mid- to Long-term Business Plan in addition to
my impression of him during that one-year period. CEOs do notdecide everything by themselves. It is important that they have theability to bring together opinions from across the Company and form
a consensus. The current selection was arrived at in light of theperspective that CEO Arai excels in communicating externally as
pointed out by Mr. Mogi.
The Advisory Committee Relating to Nominations andCompensation ensures that its discussions are fair, that the candidates have no conflicts of interest, and that it transparently reports to
the Board of Directors, then the Board selects the candidate. This
process is very important. Keeping this in mind, the committee also
strives to reach an agreement after exploring arguments asmeticulously as possible.
Miyakawa The one thing I was concerned about was how employees
might feel about the CEO being from a major shareholder. From actual
conversations I have had with multiple employees, there were many
opinions about how qualified as a business person a candidate
should be, it does not matter to them where the candidate may come64

Nomura Real Estate Holdings, Inc.

from, and I think that kind of feeling is really important.
Takahashi Even if a new CEO needs to be selected going forward, I
firmly believe that there is consensus as a company that all of the candidates’ qualities, capabilities, and experiences will be considered andthe most appropriate person will be selected.

Expectations for the Sustainable Growth of the
Nomura Real Estate Group
Miyakawa I expect the Group to venture into new business fields andstart something new. Beyond that, I think the Group likely has a very
big future. The Group will make money with its core businesses,
which constitute its current golden goose, while steadily nurturing
future ones. I think it will be important to adeptly achieve balance.
Takahashi The long-term vision has already been released, and I
recognize that the entire Company is working together to achieve it.
That is important too, but what I am focusing on is the operating
results of the current fiscal year. The operating results for the first yearof the plan indicated we were off to a great start, and the results thus
far for this second year are also good. I have high expectations thatthe results will continue like this.
The most important matter is that each business unit clearly
achieves the business targets they set for themselves, so I intend tocontinue monitoring the situation and expressing my opinions.
The real estate business is generally thought to be limited to horizontal expansion in its business field, but, going forward, as companies evolve and transform, it is important to create new value from acompletely new perspective that looks beyond existing businesses.
The younger generation of employees should believe that they especiallyneed to maintain that mindset, or else companies will not change.
I want the Company to value challenges as well as innovative,
forward-looking, and diverse creativity and expansion over the long term.
I feel the current corporate culture is still rather conservative. I would
like everyone to break out of their shells with the aim of becoming acompany unlike any seen before.
Mogi I especially would like the younger generation of employees tohave a sense of urgency. As Japan’s population declines, theCompany, which is in the real estate business, needs to always be
thinking about what it will do for the future. Over the last few years,
the business has appeared to be stabilizing, but the operating results
could deteriorate in a flash if there is not a sense of urgency. I intend
to carefully monitor whether that sense of urgency has been instilled
and connected to behavior.

Introduction

Our Vision(To be)Our Current Strengths and Core(Strengths)

Our Challenges and Strategies(Actions)

The Foundation of Our Activities(Base)

Data, etc.

Message from the Chairman of the Board of Directors
The Company changed its management structure in April 2023, and Satoshi Arai
became President, Representative Director, and Group CEO, and I became Chair andDirector. When I assumed this position, I was charged with the mission of contributing tosustainable growth in corporate value in part by leveraging my eight years of experienceas CEO to supervise the Board of Directors and strengthen governance as chairman.
To sustainably grow corporate value, it is imperative that we build a structure that is
capable of addressing the various issues the Group faces. From my time as CEO, thisis something that I have consistently held to be true, and over the years I have taken
part in implementing such various measures as introducing a business unit management structure, establishing the Advisory Committee Relating to Nominations andCompensation, introducing a performance-based share-based compensation systemand evaluations based on sustainability-related indices, and formulating succession
plans for CEOs and others.
In addition, as third-party organizations have confirmed, free and lively discussions
take place at the Company’s Board of Directors meetings. In particular, in the process
of formulating the Nomura Real Estate Group Vision for 2030, Mid- to Long-term
Business Plan, and Sustainability Policy, which were announced in April 2022, we held
many discussions that bridged in-house and external boundaries and reflected varied
input in their content.
To realize these goals going forward amid the major current changes in the businessenvironment, deeper discussion will be needed at Board of Directors meetings. To realize
our vision, “Be a ‘Life & Time Developer,’ as never seen before,” I intend to continue working to help enhance long-term corporate value as chairman of the Board of Directors.

Eiji Kutsukake
Chairman of the Board of Directors(Chair and Director)

Greetings on My Appointment as an External Director
In June 2023, I became an external director of the Company. My background is indeveloping human capital management at companies employing people of diverse
nationalities, such as domestic and overseas drug manufacturers. Through this work, I
was always aware that spaces for life and work were essential to ensuring that people
are able to enjoy vibrant lives. The products and services provided by the Group not
only create spaces, they simultaneously create connections with communities andshape the time that people spend there. I believe they have very important value forsociety as a whole in the future.
In addition, the level of attention being paid to human capital is currently on the rise.
I recognize that uniform policies across multiple companies is not sufficient. To continue
fully drawing out the value of human resources, it is important to engage in dialoguethat considers the Group’s unique perspective. I intend to continue proactively stating
my opinions at Board of Directors meetings and leveraging my executive experienceand insight from the human resources department. I also aim to continue monitoring
operational execution while keeping a close eye on in-house systems.

Chiharu Takakura
External Director

Chiharu Takakura has great knowledge and experience and profound insights into human resources strategy and development acquired
during her many years executing business in important roles in the human resources division of a global company, as well as participating on
specialist committees for a governmental agency. She has been an external director since June 2023.

Integrated Report 2023

65

Corporate Governance

Overview of corporate governanceThis report provides details of the Company’s corporate governance system.

Basic concept of our corporate governanceImprovement of the effectiveness of the Boardof Directors

p. 66
Characteristics of our corporate governance systemp. 72
Strategic shareholdings policy

p. 67
Corporate governance systemp. 73
Compensation for directors

p. 68
Diversity of directors

p. 74
Risk management

p. 70

p. 76

Status of compliance with the Corporate Governance Code
The Company complies with all principles set forth in the Corporate Governance Code. As of March 31, 2022, it did not comply with the Supplementary
Principle 4.1.3. (Proper Supervision of Successor Plans for CEO, etc.) of the Corporate Governance Code and provided reasons for doing so. However,in FY2023/3, the Company positioned this subject as an important matter requiring consultation with the Advisory Committee Relating toNominations and Compensation. Said committee has deliberated on this subject and reviewed a portion of its standards for the selection of executives
and the process for such selection. Based on this review, the Company decided to comply with this supplementary principle.

Basic concept of our corporate governance
The Company believes that it must be governed in a way that continuously maximizes the Group’s value over the long term, while giving
consideration to the interests of shareholders and all other stakeholders of the Company. It aims to enhance the earnings power of the entire
Group, while carrying out its duties as a holding company in managing and supervising the business activities of its subsidiaries. Also, it endeavors
to build a more transparent management system in accordance with the Basic Corporate Governance Policy formulated in 2015.
• Corporate Governance https://www.nomura-re-hd.co.jp/english/company/governance.html• Basic Corporate Governance Policy https://www.nomura-re-hd.co.jp/english/company/pdf/cgpolicy.pdf

66

Nomura Real Estate Holdings, Inc.

Introduction

Our Vision(To be)Our Current Strengths and Core(Strengths)

Our Challenges and Strategies(Actions)

The Foundation of Our Activities(Base)

Data, etc.

Characteristics of our corporate governance system
In order to further strengthen the supervisory functions of the Board of Directors by providing directors who serve as Audit & Supervisory
Committee Members with voting rights at Board of Directors’ meetings and by other means, the Company transitioned to a company with an Audit& Supervisory Committee in 2015 and established the Advisory Committee Relating to Nominations and Compensation in 2016. Appointing multiple
external directors and establishing the Advisory Committee Relating to Nominations and Compensation are intended to strengthen the supervisory
function of the Board of Directors and ensure fair and highly transparent management function. At the same time, by establishing the risk management
system, compliance system, and internal audit system, the Company ensures the effectiveness of supervision by the Board of Directors over the
directors’ execution of duties and the executive officers’ business operations by having regular reports submitted to the Board of Directors about thosesystems. Currently, the majority of the members of the Audit & Supervisory Committee and the Advisory Committee Relating to Nominations andCompensation are independent external directors.
The Company also introduced the executive officer system to separate the business execution function from the management supervision anddecision-making functions in order to enhance the execution function and thereby reinforcing the management of the Group. Each executive officer
selected by the Board of Directors is delegated authority based on internal regulations and executes business operations pursuant to the Company's
policy determined by the Board of Directors and instructions from the CEO.
Our efforts to reinforce corporate governance(FY)

2013/3

2014/3

2015/3

2016/32017/3

2018/3

2019/32020/32021/32022/32023/32024/3• Introduced an executive ofﬁcer system to separate the business execution function from the management and supervisory functions• Established the Management Committee to help strengthen Group management systems

Organization• Transitioned to a company with an Audit & Supervisory Committee• Established the Advisory Committee Relating to Nominations and Compensation• Appointed an external director as a Chairman of the Advisory
Committee Relating to Nominations and Compensation

Directors (No.)

6*5External (No.)

0

Independent external (No.)

0Female (No.)

5*

8

1

2

1

0

12

13

12*

11

5

4

4

5

1

2

4

1

2

1

2

• Began conducting an assessment of the effectiveness of the Board of Directors

The assessment ofeffectiveness

Compensation

13• Began utilizing a third-party evaluation organization• Raised the maximum number of share acquisition rights used for stock
options to increase the performance-based compensation ratio in orderto share more interests with shareholders• Implemented performance-based share compensation• Partially transferred authority from the Board of Directors to the Management Committee to speed up businessexecution• Formulated the Basic Corporate Governance Policy

Others• Disclosed reasons for appointment of directors• Reorganized and restructured items, systems, and divisions/departments
for risk management in order to strengthen the risk management system*Reduction due to resignation or retirement during the period is not stated.

Integrated Report 2023

67

Corporate GovernanceCorporate governance system

Characteristics of the Group’s governance system• An independent external director being the Chairman of theAdvisory Committee Relating to Nominations and Compensation• Company with an Audit & Supervisory Committee• A non-executive Director being the Chairman of the Board of Directors• Independent external directors being the majority of the membersof the Audit & Supervisory Committee and the Advisory Committee
Relating to Nominations and Compensation• Out of 11 directors, four being independent external directors• Established the Advisory Committee Relating to Nominations
and Compensation

Chart of Corporate Governance System
General Meeting of Shareholders
Appointment
Appointment/Dismissal

Nomura Real Estate Holdings
1

Chairman of
the Board of
Directors

Board of Directors
3

Advisory Committee
Relating to Nominations
and Compensation

Chairman of
the Committee

Certified public accountants (Auditing firm)

Takahashi Kutsukake

Directors
KutsukakeDirectors(Audit & Supervisory
Committee Members)

Arai

MatsuoHaga

Kurokawa

Takakura

Audit & Supervisory

Chairman of
the Committee

2

KimuraAudit &
Supervisory
Committee

Mogi

Audit

Executive Vice Executive Vice
President and President and President andRepresentative Representative Representative
Director
Director
Director

Takayama

Mogi

Miyakawa

Appointment/Dismissal

Appointment of members

President and Representative Director

4

Takahashi

Audit & Supervisory Committee Dept.

Management Committee
5

Budget Committee

6

Risk Management Committee

7

Sustainability Committee

Internal(Non-executive directors)

8

DX Strategy Committee

Internal(Executive directors)

9

Wellness and D&I Management Committee

Independent External Directors
Various departments

Group Internal Audit Dept.

Guidance/Support/Monitoring, etc.

Group companies

Group governance
As a holding company, the Company manages its Group companies under various regulations such as Regulations regarding Group Organizational
Management and Group Internal Audit. Also, its directors (excluding those who serve as Audit & Supervisory Committee Members) and executive officers also
hold the post of director, etc., in major Group companies, or directors who serve as Audit & Supervisory Committee Members also act as Audit & Supervisory
Board Members in major Group companies to strengthen Group management. Furthermore, the Company has built systems for risk management, compliance,
and internal audits within the Company itself and the entire Group, with the Board of Directors regularly receiving reports on each of the systems, for an effective
monitoring of Group management.

68

Nomura Real Estate Holdings, Inc.

Introduction

1

Our Vision(To be)The Board of Directors

Our Current Strengths and Core(Strengths)

Held 15 times during FY23/3

Roles of the Board of Directors
The Board of Directors bears responsibility for achieving the sustainable growthof the Company and working to maximize long-term corporate value through therealization of effective corporate governance for all shareholders. To fulfill this
responsibility, the role of the Board of Directors is to ensure the fairness and transparency of management by fully supervising management, and make the best
decisions for the Company through important business execution decisions, etc.

Our Challenges and Strategies(Actions)

3

Roles of Independent External Directors
In order to strengthen the supervisory function of the Board of Directors andachieve fair and highly transparent management, one independent external director(excluding those who serve as an Audit & Supervisory Committee Member) andthree independent external directors who serve as Audit & Supervisory
Committee Members are appointed.
The main role of independent external directors is, based on their own
knowledge, to give appropriate advice from the viewpoint of the Company’ssustainable growth and the improvement of corporate value, to supervise
management through significant decision making by the Board of Directors, tosupervise conflicts of interest between the Company and management or major
shareholders, etc., and to appropriately express the opinions of shareholders
and other stakeholders to the Board of Directors from a standpoint independent
from management.
The Company has formulated its own criteria for determining the impartiality of
independent external directors, in addition to the independence standards for“Independent Directors” set out by the Tokyo Stock Exchange.
• Criteria for Determining Impartiality of Independent External Directors: Article 14 of the
Basic Corporate Governance Policy
https://www.nomura-re-hd.co.jp/english/company/pdf/cgpolicy.pdf

2 The Audit & Supervisory Committee

Held 12 times during FY23/3

Roles of Audit & Supervisory Committee
The Audit & Supervisory Committee performs audits utilizing the Company’s
internal control system. We have developed a system through which theCommittee receives periodic reports on the implementation status of internal
audits and their results from the Internal Audit Dept., and has the authority to ask
directors, executive officers, and operating divisions of the Company and Group
companies to report such matters when necessary. Audit & Supervisory
Committee Members can attend the Company’s important meetings, including
those of the Management Committee, gather information on the business execution
status, and express their opinions so that an effective system for audits andsupervision is secured.

Composition of the Audit & Supervisory Committee
The majority of Audit & Supervisory Committee Members comprises independent
external directors, and at least one of the members, who also serves as a director,
possesses appropriate knowledge of finance and accounting. The Audit &Supervisory Committee consists of five members, of which two are Audit &Supervisory Committee Members (full-time) and three are Audit & Supervisory
Committee Members (independent external directors).

Main initiatives taken by the Audit & Supervisory Committee
Main matters on the agenda at the meetings of the Audit & Supervisory
Committee include providing consent for the nomination of directors who act as
Audit & Supervisory Committee Members, drawing up audit plans, providing
consent for the internal audit plan submitted by the Group Internal Audit Dept.,

Data, etc.

the preparation of audit reports, the reappointment/replacement of the
Accounting Auditor based on assessments of its performance, providing consent
for compensation for the Accounting Auditor, and deciding on the appointment
and compensation, etc., of the directors except for Audit & Supervisory
Committee Members. The fulltime Audit & Supervisory Committee Members
attend important meetings of the Company and request reports from operating
divisions as necessary to gather information on the Company’s businessexecution status.

Composition of the Board of Directors
The Company’s Board of Directors comprises six directors (excluding directors
who serve as Audit & Supervisory Committee Members) (of which one is anexternal director) and five directors who serve as Audit & Supervisory Committee
Members (of which three are external directors). The Company appoints diverse
directors with various knowledge, experience, and skills in order to ensure thenecessary balance and diversity as a holding company that manages companies
that conduct business in a wide array of areas. In order to strengthen the
supervisory function of the Board of Directors and realize highly fair and transparent
management, four of the 11 directors are independent external directors.

The Foundation of Our Activities(Base)The Advisory Committee Relating toNominations and Compensation

Held 9 times during FY23/3

The Company established the Advisory Committee Relating to Nominations andCompensation, as an advisory body to the Board of Directors, of which the
majority of the members comprises independent external directors, to strengthen
the objectivity, independence, and accountability of functions of the Board of
Directors in relation to the nomination and compensation of the directors andexecutive officers. Currently, the Advisory Committee Relating to Nominations
and Compensation consists of three members, of whom two are independent
external directors. An independent external director is the Chairman of theAdvisory Committee Relating to Nominations and Compensation. The Committee
discusses such matters as those relating to the nomination and compensation of
directors and executive officers, succession plans for these positions and training
policies, and reports the outcome to the Board of Directors.

4 Management Committee

Held 47 times during FY23/3

The Committee, which comprise the Chief Executive Officer, the Executive Vice
President and Executive Officers, determines certain matters regarding the executionof business at overall Group companies. The Chair and Director and Directors
who act as Audit & Supervisory Committee Members attend meetings of theCommittee, where they express their opinions as necessary.

5 Budget Committee

Held 10 times during FY23/3

Under the Management Committee, for the compilation of budgets, preparationof the Mid- to Long-term Business Plan, and other matters, the Committee
discusses the planning, execution, and other matters regarding budgets and theMid- to Long-term Business Plan.

6 Risk Management Committee

Held 7 times during FY23/3

Under the Management Committee, with the aim of securing the continuity andstable development of business through the practice of risk management, theCommittee discusses matters in connection with internal controls, risks in theGroup’s management and other matters.

7 Sustainability Committee

Held 3 times during FY23/3

Under the Management Committee, the Committee discusses matters on the
promotion of sustainability and other items for the purpose of establishing policies
and plans, managing results, deepening Group employees’ understanding, anddisclosing various information regarding the promotion of sustainability.

8 DX Strategy Committee

Held 13 times during FY23/3

Under the Management Committee, the Committee discusses matters regarding
DX strategy and investment plans for preparing the ICT base and establishing
information systems with the aim of establishing policies and plans regarding thepromotion of DX, improving the ICT environment, and realizing its effective use.

9

Wellness andD&I Management Committee

Held 3 times during FY23/3

Under the Management Committee, the Committee discusses the formation of
mid- to long-term goals and various concrete implementation measures related
to promoting wellness, workstyle reforms, the empowerment of women, and theutilization and active participation of the Group’s diverse human resources inorder to maintain sound, comfortable workplace environments in which people
can work with vigor and achieve wellness, and also to formulate human resource
development policies and to promote internal environment development for
ensuring diversity.
Integrated Report 2023

69

Corporate GovernanceDiversity of directors
Based on Basic Corporate Governance Policy, the Group has a policy of appointing and nominating a diverse range of people with a variety ofknowledge, experience, and skills as senior management.
Composition of the Board of Directors and Committees
Percentage of Independent
External Directors on the
Board of Directors

36.4%

63.6%

Percentage of female Directors on
the Board of Directors

18.2%

81.8%

Percentage of Independent
External Directors on the Audit &Supervisory Committee

60.0%

40.0%

Percentage of Independent
External Directors on the Advisory
Committee Relating toNominations and Compensation

66.7%

33.3%

4

2

3

2

11

11

5

3

■ Independent External Directors■ Independent External Directors■ Independent External Directors■ Female■ MalePositions and roles, attributes, attendance, etc., of directors

Name

Position/Responsibilities

Executive/External/
Independent/New

Term ofofﬁce*1

GenderAttendance rate at meetings ofBoard of Directors (upper row) and
Audit & Supervisory Committee(bottom row) (number of meetings)

Non-executive

9

Male

100% (15/15)

Eiji Kutsukake

Chair and Director

Satoshi Arai

President and Representative Director,
and Executive Officer
Group CEO

Executive1

Male

100% (10/10*3)

Daisaku Matsuo

Executive Vice President, Representative
Director, and Executive Officer
Group COO

Executive2

Male

100% (15/15)

Makoto Haga

Executive Vice President, Representative
Director, and Executive Officer

Executive

6

Male

100% (15/15)

Hiroshi Kurokawa

Director and Executive Officer

Executive2

Male

100% (15/15)

Chiharu Takakura

Director—Female(Assumed on June 23, 2023)

Hiroyuki Kimura

Director(Audit & Supervisory Committee Member)(Full-time)Non-executive

2

Male

100% (15/15)
100% (12/12)

Yasushi Takayama

Director(Audit & Supervisory Committee Member)(Full-time)Non-executive

4

Male

100% (15/15)
100% (12/12)

Yoshio Mogi

Director(Audit & Supervisory Committee Member)

Non-executive External

4

Male

100% (15/15)
100% (12/12)

Akiko Miyakawa

Director(Audit & Supervisory Committee Member)

Non-executive External

4

Female100% (15/15)
100% (12/12)

Tetsu Takahashi

Director(Audit & Supervisory Committee Member)

Non-executive External

3

Male

100% (15/15)
100% (12/12)

Non-executive External
Independent New

Independent

Independent

Independent*1 Term of office as director as of June 23, 2023
*2 : Committee Chairman*3 Number of meetings held in the fiscal year ended March 31, 2023 since assuming the position of director on June 24, 2022

70

Nomura Real Estate Holdings, Inc.

Audit &
Supervisory
Committee
Members*2

Advisory Committee
Relating toNominations andCompensation
Members*2

Introduction

Our Vision(To be)Our Current Strengths and Core(Strengths)

Our Challenges and Strategies(Actions)

The Foundation of Our Activities(Base)

Data, etc.

Director skills matrix
The fields in which the Group expects directors are as follows:
Name

Fields of expectation for directors
Corporate management

Finance/Accounting

Legal/Compliance

Real estate/Construction

Overseas Business

ICT/Digital

Sustainability/D&I

Eiji Kutsukake
Satoshi Arai
Daisaku Matsuo
Makoto Haga
Hiroshi Kurokawa
Chiharu Takakura
Hiroyuki Kimura
Yasushi Takayama
Yoshio Mogi
Akiko Miyakawa
Tetsu Takahashi*The above table does not represent the total knowledge and experience, etc., of each director.

Reasons for the appointment of external directors
Name

Reasons for the appointment

Chiharu Takakura

Chiharu Takakura has great knowledge and experience and profound insights into human resources strategy and development, acquired during her many years executing
business in important roles in the human resources division of a global company as well as participating on specialist committees for a governmental agency. She has been
selected as an external director because it is expected that by leveraging her skills and experience she will contribute to the promotion of human capital management, thestrengthening of the supervisory function of the Board of Directors and corporate governance systems, and fair and transparent management.

Yoshio Mogi

Yoshio Mogi has great knowledge, experience and extensive insights concerning corporate management acquired through his many years working as a corporate manager.
He has been selected as an external director as Audit & Supervisory Committee Member because it is expected that his extensive experience and knowledge
will contribute to strengthening the supervisory function of the Board of Directors and the corporate governance structure, as well as to enhancing the auditing structure.

Akiko Miyakawa

Akiko Miyakawa has great knowledge, experience and extensive insights as an expert at accounting and auditing acquired through her many years working as a Certified
Public Accountant. She has been selected as an external director as Audit & Supervisory Committee Member because it is expected that her extensive experience and knowledge will contribute to strengthening the supervisory function of the Board of Directors and the corporate governance structure, as well as to enhancing the auditing structure,
although she has no previous experience directly involved in the management of a company other than as an external director.

Tetsu Takahashi

Tetsu Takahashi has great knowledge, experience and extensive insights as a legal expert acquired through his many years working as a lawyer. He has never in the past been
directly involved in the management of a company except as an external director. However, he has been selected as an external director and as Audit & Supervisory Committee
Member because it is expected that his extensive experience and knowledge as a representative of a law firm and an external director and outside audit & supervisory board
member of other companies will contribute to strengthening the supervisory function of the Board of Directors and the corporate governance structure as well as to enhancing
the auditing structure.

Initiatives to Support and Improve the Skills of Directors
The Company actively provides training based on its group vision and management strategies. The Company also regularly provides opportunities for all directors to receive training from guest lecturers from outside the Company to improve their knowledge of topics such as corporate governance and DX. Also, when
external directors assume office, they are provided with an explanation regarding topics such as the Group’s history, business framework, and business model,
to deepen their understanding of said topics. After the external directors’ tenures begin, in addition to ensuring regular opportunities for training, the Company
also provides opportunities for them to tour the Company’s properties. In addition, in order to facilitate smooth deliberations, materials for the Board of Directors
meetings are provided in advance, and, if necessary, briefings are held prior to the meeting.
Speciﬁc initiatives

Number of sessions(FY 2023/3)

Training from guest lecturers
from the outside the Company

In the fiscal year ended March 2023, we invited outside experts to hold study sessions for directors and executive officers,
with “The Most Important Points to Be Considered to Promote Diversity & Inclusion” as a key topic.

1

Tour of the Company’s properties

To deepen understanding of the Group’s wide-ranging business operations, we provide regular opportunities for external
directors to tour the Company’s business properties.

1

Integrated Report 2023

71

Internal Controls, Compliance/Information Disclosure

Improvement of the effectiveness of the Board of Directors
For the continuous improvement of the effectiveness of the Board of Directors, the Company performs a cycle of assessment of the effectivenessof the Board of Directors, and the Board of Directors determines and implements response policies based on the assessment results.

Conduct questionnaire
surveys andinterviews of all
directors by a thirdparty organization

Each director evaluates
the effectiveness of
the Board of
Directors from theirown perspective

Analysis andevaluation by the
Board of Directors

Determination of
response policy

Execution

By assessing the effectiveness of the Board of Directors each year,
the Company aims to regularly grasp the status of improvement
and further improve the effectiveness of the Board of Directors.

Details of the assessment of effectiveness of the Board of Directors in the fiscal year ended March 2023 are as follows:
Surveys• Conducted questionnaire surveysof all directors

Members

The scale of the Board of Directors and the ratio of independent external directors arebroadly appropriate.

• Conducted interviews of all directors
by utilizing a third-party evaluation
organization

Discussion status

Discussions are free and lively, exceeding internal and external limits and leveraging theknowledge and experience of each Director. In particular, discussions were enhanced by
the opinions, etc., of external directors.

Operation

The Board of Directors has been operating stably with materials provided beforehand andthe number of agenda items being balanced.

Response
For the fiscal year ending March
2024, the Company will designate“enhancement of discussions ofstrategy” and “strengthening of IR
and governance functions” as priority
measures, and it will promote
initiatives aimed at the further
improvement of corporate value
and strengthening of corporate
governance.

72

Analysis and evaluation by the Board of Directors

Nomura Real Estate Holdings, Inc.

In the course of deliberating individual agenda items, the Board of Directors was able toMatters for discussion allocate a certain amount of time to engage in meaningful discussions based on a perspective of sustainable growth for the Company and improvement in its corporate value.

IssuesOperation

In order to allocate more time to deliberations on important agenda items, it is necessary
to continue to work on improvements.

Matters for discussion

The Company recognizes that discussions of strategies that require a medium- to longterm perspective need further enhancement.

Introduction

Our Vision(To be)Our Current Strengths and Core(Strengths)

Our Challenges and Strategies(Actions)

The Foundation of Our Activities(Base)

Data, etc.

Main discussions of the Board of Directors
The Company’s Board of Directors engages in deeper discussions. The main decisions, reports, and discussions during the fiscal year ended
March 2023 were as follows.
Categories

Main themes• Annual budget, policy for shareholder returns, fundprocurement(Borrowings, Bonds, etc.)
Business strategy• Financial results• Investor trends/IR strategy• Business Unit strategy• Promotion of D&I• Digital strategy• Promotion of sustainability• Promotion of wellness management• Human resources strategy• Examination of M&A• Evaluating the effectiveness of the Boardof Directors
Corporate governance• Policy for responding to Audit & Supervisory
Committee audit findings• Enhancing group governance• Monthly monitoring of response status to various
management issues• Advisory matters to Advisory Committee Relating
to Nominations and Compensation

Risk management/Compliance/Audits• Asset risk management• Overseas Business monitoring report• Management of investment risks and external risks• Formulation of the annual compliance program• Report of Risk Management Committee• Formulation of the group internal audit plan andthe report on the results

Strategic shareholding policy
The Group's strategic shareholding policy is that it contributes to the improvement of the Group's corporate value
from a comprehensive perspective such as strengthening business relationships with business partners and strategic
business alliances.
The basic policy is that the Board of Directors annually verifies the rationality of the Group’s continuous holding ofshares of listed companies held for purposes other than pure investment (strategic shareholding) and, based onthat verification, it sells off shares with low rationality for holding in consideration of the market environment. As of
the fiscal year ended March 2023, the Company had no strategic shareholdings.

Strategic shareholding
possession status0(zero)

Integrated Report 2023

73

Compensation for Directors

The policy for deciding the details of compensation for directors, etc.
The Board of Directors of the Company has resolved the policy for deciding the details of compensation, etc., for each individual Director, excluding
Audit & Supervisory Committee Members. In addition, the Company has established the Advisory Committee Relating to Nominations andCompensation, the majority of whose members are independent external directors, and, based on the deliberations of this Committee and theopinions it has submitted to the Board of Directors, the Board of Directors has resolved the operation, etc., of the compensation plan for the directors.

Basic Policy(1) Compensation for directors is linked to the Mid- to Long-term
Business Plan, etc., in order to provide sufficient incentive for thesustainable improvement of corporate value, and the Company’s
basic policy in deciding compensation for each director entails
providing an appropriate level of compensation according to theindividual’s role and position as a director.
(2) The operation and revision of the compensation plan for directors
and the amount of the compensation for directors are determinedby the Board of Directors based on the deliberations of theAdvisory Committee Relating to Nominations and Compensationand the opinions it submits to the Board of Directors.
(3) In reviewing the appropriateness of the compensation level and thecontent of the share-based compensation plan, the Company
takes into consideration such factors as the scale of the Company
and business characteristics, after obtaining advice from an external
compensation consultant as necessary.

(4) Compensation for directors concurrently serving as executive
officers consists of “base compensation,” “bonuses,” and“share-based compensation,” so that it works as a clear incentive
to improve performance not only for the short-term, but also forthe mid- to long-term.
(5) Compensation for the Chairman of the Board of Directors andexternal directors (excluding Audit & Supervisory Committee
Members) is made up of the “base compensation” and the“restricted shares (“RS”) portion of share-based compensation,”taking into account the sharing of interests with shareholders, asthese individuals are responsible for supervising the execution ofbusiness from an objective standpoint and also for enhancing
long-term corporate value.
(6) Compensation for Part-time Internal Directors consists only of“base compensation” due to their role of supervising the businessexecution from an objective standpoint.

Policy for determining ratios of each type of compensation for individual directors(1) Ratios of compensation for directors and executive officers are determined in accordance with the Basic Policy, items (2) and (4).
(2) Ratios of compensation for the Chairman of the Board of Directors and external directors are determined in accordance with the Basic Policy,
items (2) and (5).
(3) Compensation for Part-time Internal Directors consists only of base compensation, in accordance with the Basic Policy, items (2) and (6).

Categories of compensation of directors
Compensation categories

Fixed compensation

Evaluation criteria

Base compensation

Determined according to the role and position as a director.

Granted according to roles and positions

Bonuses

Determined according to the Company’s business performance, such as
consolidated business profit, and evaluation of individuals. Said evaluations are
made in light of the implementation progress of single-year and mid- tolong-term initiatives, for which achievements are difficult to measure based
only on financial results.

• The Company’s business performance, such as consolidated
business profit• Implementation status of single-year measures and mid- tolong-term measures, etc.
• Evaluation based on non-financial indicators(sustainability factors, BEI, etc.)

Share-based
compensation (PS)

Performance-sharing ("PS") is adopted as performance-based compensation,
providing an incentive for the enhancement of mid- to long-term performance.
Implementation, through the delivery or payment of the Company’s shares
and/or an amount equivalent to the proceeds of converting the Company’s
shares into cash, occurs three years after the commencement of the relevantbusiness year.

Performance-linked evaluation after 3 years(Evaluation index: Business profit, ROE)

Share-based
compensation (RS)Restricted shares ("RS”) is adopted as non-performance-based compensation,
providing an incentive for long-term contributions and enhancing corporate
value. Implementation is delayed until the individual’s retirement as an officer.

Granted based on position (increasing compensation due
to rising stocks)

Variable compensation

74

Determination policy for each type of compensation

Nomura Real Estate Holdings, Inc.

Introduction

Our Vision(To be)Our Current Strengths and Core(Strengths)

Our Challenges and Strategies(Actions)

Categories of compensation of directors
Fixed compensation
Base compensation

The Foundation of Our Activities(Base)

Data, etc.

Directors’ compensation ratio (images)
Note: Assuming 100% variable compensation payment of the basic
amount set by the Group

Variable compensation
Bonuses

Share-based compensation
PS*

RS*

Variablecompensation

Directors concurrently
serving as executive ofﬁcers
Chair and Director——

External directors (excluding
Audit & Supervisory
Committee Members)——

Directors (Audit &Supervisory Committee
Members)——

Nonperformance-based
compensation(RS)
Base compensation

Performance-based
compensation(PS)—

Bonuses* PS: Performance-sharing (performance-based compensation) / RS: Restricted shares(non-performance-based compensation)

Total amount of compensation, etc., by director category and total amount of compensation, etc., by type and the number of directors applicable
Total amount of compensation, etc., by type (millions of yen)
Total amount ofcompensation, etc.
(millions of yen)

Base compensation

Bonuses(Performance-based
compensation , etc.)

Directors (excluding directors who also serve as Audit & Supervisory
Committee Members) (excluding external directors)

661

295

151

120

94

6

Directors (Audit & Supervisory Committee Members)(excluding external directors)

102

102

—

—

—

2

External directors

61

61

—

—

—

4

Total

825

459

151

120

94

12

Director categories

Share-based compensation (Non-monetarycompensation, etc.)
Performance-based
compensation

Number of directors
applicableNon-performancebased compensation

Notes
1. The number of directors (excluding directors who also serve as Audit & Supervisory Committee Members) (excluding external directors) is six as of the end of the fiscal year ended March 2023.
2. The number of directors (who also serve as Audit & Supervisory Committee Members) (excluding external directors) is two as of the end of the fiscal year ended March 2023.
3. The number of external directors is three as of the end of the fiscal year ended March 2023. The difference with the number of directors applicable shown above is due to the inclusion of one
director who retired on December 31, 2022.
4. The compensation (“base compensation” and “bonuses”) of directors has been set as no greater than ¥550 million per year for directors (excluding directors who also serve as Audit &Supervisory Committee Members) according to a resolution at the Ordinary General Meeting of Shareholders held on June 26, 2018. At the time of the resolution, the number of directors(excluding directors who also serve as Audit & Supervisory Committee Members) was eight (of which two were external directors). Furthermore, the compensation of directors (who also serve as
Audit & Supervisory Committee Members) is limited to up to ¥170 million per year according to a resolution at the Ordinary General Meeting of Shareholders held on June 23, 2020. The numberof directors who also serve as Audit & Supervisory Committee Members at the time of the resolution was six (including four external directors). The compensation of directors is shown as theamount recorded by the Company as an expense during the fiscal year ended March 2023 regardless of whether it was paid during the fiscal year ended March 2023.
5. Aside from the compensation of directors shown in 4. above, the Company introduced a performance-based share compensation plan. In accordance with the resolution at the Ordinary
General Meeting of Shareholders held on June 24, 2022, regarding the applicable period of three fiscal years beginning from the fiscal year ending March 31, 2023 (or, in the case of a period
extension, each of the subsequent three fiscal years), the Company’s contribution to a trust as compensation for directors (excluding directors who also serve as Audit & Supervisory Committee
Members) is limited to no more than ¥1,650 million and 672,000 shares (of which the limit per external director is ¥9.9 million and 4,030 shares for each of the three fiscal years), and, at the timeof the resolution, the number of directors subject to the plan (excluding directors who also serve as Audit & Supervisory Committee Members) was seven.
6. With respect to performance-based compensation, the details of the performance indicators that pertain to monetary bonuses, the calculation method of such bonuses, and the reasons forselecting these indicators are as stated in the Basic Policy on the previous page. The actual results that pertain to performance indicators are as presented in the table below.

Fiscal year ended March 31, 2023

Business proﬁt

Period-over-period change¥105,172 million+13.4%

7. With respect to the performance-based compensation, the details of the performance indicators that pertain to share-based compensation, etc., the calculation method of such share-based
compensation, etc., and the reasons for selecting these indicators are as stated in the Basic Policy stated on the previous page. The ranges of performance indicators were decided as presented
in the tables below.

(This range covers the three-year period beginning with the fiscal
year ended March 2020 through the fiscal year ended March 2022)
Ranges

The achievement-linked
coefﬁcient
Business proﬁt
ROE(This range covers the three-year period beginning with the fiscal
year ended March 2021 through the fiscal year ended March 2023)

Results

0%-200%127.0%¥70,800 million-¥99,200 million¥92,765 million

6.5%-12.5%

9.2%

The achievement-linked
coefﬁcient
Business proﬁt
ROE

RangesResults

0%-200%

192.0%¥66,600 million-¥93,400 million¥105,172 million

4.5%-10.5%

10.1%

8. Non-monetary compensation, etc., consists of the Company’s shares, etc., and the conditions, etc., for the delivery are as stated in the previous page.
9. Based on a resolution of the Board of Directors, the amounts of monetary base compensation that is to be paid for the execution of the recipients’ duties in the fiscal year ended March 2023,
have been determined by Eiji Kutsukake, who had served as President and Representative Director until March 31, 2023 and currently serves as Chair and Director. Based on the same resolution, bonuses that are to be paid for the execution of the recipients’ duties in said fiscal year have been determined by Satoshi Arai, who assumed the office of President and Representative
Director on April 1, 2023. The reason for this delegation to the President and Representative Director is that the Company has judged the President and Representative Director as appropriate to
conduct the individual evaluation of each director while considering the performance of the Company overall. The payment level is deliberated by the Advisory Committee Relating toNominations and Compensation for the appropriate exercise of the decision authority delegated to the President and Representative Director.
Integrated Report 2023

75

Risk Management
The Group recognizes that ensuring the soundness of management through appropriate risk management and operation is an
important management issue. In the rapidly changing social environment, we will identify risks and opportunities for the Group
from a mid- to long-term perspective and take appropriate actions in order to provide new value and achieve sustainable growth.
For more detailed information, see our Financial Report. https://www.nomura-re-hd.co.jp/english/ir/pdf/FR2023.pdf

Basic Policy for Risk Management
The Group regards risk management as a “business management methodologythat aims to improve corporate value by managing all risks related to the attainmentof corporate group organizational and business objectives in an integrated andunified manner while controlling risk within the company’s risk tolerance limits.”
With the aim of ensuring the soundness of business management throughproper management and operation of risks, the Group has formulated the Risk
Management Regulations.
As its basic policy, the Group assures business continuity and stable developmentby implementing risk management and classifies its main risks into four categories,
namely “A: Investment risk,” “B: External risk,” “C: Disaster risk,” “D: Internalrisk.” Among them, risks listed below are regarded as important risks thatshould be managed, and performing effective and efficient risk management isprovided according to the scale and characteristics of each risk.

Important risks needing to be managed among main risks• Risks that could have a major impact on Group management• Risks that could have a major impact on society• Risk of litigation or other serious problems• Other major risks that should be managed by the Group

Risk Management Structure
To discuss various risks related to Group management, the Company hasprescribed the Management Committee as the integrated risk management
entity and operates a system to regularly monitor, evaluate and analyze thestate of main risks, provide necessary guidance and advice to each business
unit and Group company while regularly reporting details to the Board of
Directors. The Management Committee, which is the integrated management
body, directly monitors.
“A: Investment risk” and “B: External risk,” while the Risk Management

Committee, established as a subordinate organization of the Management
Committee, conducts regular monitoring, evaluation and analysis of “C: Disasterrisk” and “D: Internal risk” and these committees discuss basic response policies
regarding risk prevention, response when risk occurs, and prevention of recurrence
after risk occurs. Moreover, we established the Group Risk Meeting consistingof directors and executive officers of each Group company appointed by thechairman of the Risk Management Committee to share risk information andresponse policies within the Group.
With regard to risk management, each Business Unit manager will supervise
the risk management of their affiliated business unit and report on the situation
to the Management Committee or Risk Management Committee as necessary.
Concurrently, the president of each Group company (the head of each divisionat Nomura Real Estate Development) is responsible for reporting risk management
matters to the Business Unit Manager in a timely and appropriate manner.
In addition, we have defined the organization in charge of business in eachGroup company as the “first line” of risk management, the organization in chargeof corporate operations at the Company and each Group company as the “secondline” of risk management, and the organization in charge of internal audits at theCompany and each Group company as the “third line” of risk management.
With each “line” playing its role in risk management, for example, the “secondline” and “third line” of the Company providing support, guidance and cooperation
to the “second line” and “third line” of the group companies, respectively, we
have established efficient organizations and processes that support governanceand risk management.
In the event of a major problem requiring urgency, the chairman of the Risk
Management Committee decides the basic policies such as countermeasuresupon consulting with the executives’ responsible for relevant departments inaccordance with the Risk Management Regulations and reports to the President(Group CEO) and provides instructions such as response in accordance with thebasic policy.

Board of Directors

ReportNomura Real Estate Holdings, Inc.

Guidance / Monitor

Management Committee (Integrated management entity)

Risk Management Committee(A) Investment risks(C) Disaster risks(B) External risks(D) Internal risks

Three Lines Model

Each Business Unit Manager / Executive Ofﬁcer in charge of Overseas Business /Executive Ofﬁcer in charge of Development Planning / Supervisor of Management Division

President of each Group company / Head of Each Division at Nomura Real Estate Development

2nd line(The organizationin charge ofcorporate operations)Audit

3rd line(The organizationin charge ofinternal audits)

Support / Guidance / Monitor

Group Companies

2nd line(The organization in charge ofcorporate operations)Support of risk management / Monitoring

1st line (The organization in charge of business)

Audit
Audit

Audit

3rd line(The organizationin charge ofinternal audits)

Guidance / Cooperation / Monitoring

Conduct appropriate risk-taking operations mainly through risk recognition andcontrol, and the development and operation of systems that handles risk.
Audit

76

Nomura Real Estate Holdings, Inc.

Introduction

Our Vision(To be)Our Current Strengths and Core(Strengths)

Details of main risks
The following are the main risks that the management recognizes that have thepotential to significantly influence the financial position, business performanceand cash flows of the company and the consolidated subsidiaries. Among thesemain risks, the Company has selected several risks requiring particular attention
during the fiscal year ending March 2024, in consideration of factors such as the

Our Challenges and Strategies(Actions)

The Foundation of Our Activities(Base)

Data, etc.

magnitude of the potential impact on its businesses and the external environment.
Matters concerning the future and the recognition of risks in the text are as
determined by the Group as of the end of the fiscal year ended March 2023. The
following, however, does not include all risks. Risks that are unpredictable ordeemed insignificant at this point in time may impact on businesses in the future.

The details of risk categories and each main risk items are as follows.
Risk categories(A) Investment risks

Risks related to individual investments (real estate investments, strategic
investments (M&A), etc.)

Main risk items
1) Risks associated with real estate investment
2) Risks associated with strategic investment (M&A) and new businesses
3) Risks associated with market changes(B) External risks

Risks related to external factors inﬂuencing business(C) Disaster risks

Risks generated by disasters that have a large impact on customers andbusiness continuity4) Risks generated by changes in economic conditions5) Risks generated by changes in political/social conditions/systems (laws and regulations, tax systems, accounting, others)6) Risks due to lagging behind in innovation and changes in the structure of society related to the business7) Risks related to disasters (earthquakes, typhoons, floods, tsunamis, volcanic eruptions, major fires, epidemics of infectious
diseases, etc.) that have a major impact on customers and business continuity8) Risks related to the violation of laws and ordinances
9) Risks related to quality defects(D) Internal risks

Operational risks occurring at the Company and each group company

10) Risks related to occurrence of information system crisis
11) Risks from inadequate responses to matters related to human resources12) Risks related to occurrence of fraud and negligence

Risks to which we pay special attention
Risk categories

Main risk items(A) Investment risks• Risk of inability to secure the expected business volume and making it difficult to secure the expected business volume and achieve the profit growth projected in the Mid- to Long-term Business Plan due to intensifying
competition for land acquisition, etc.
• Risk that the Company will not earn the expected profits due to an increase in construction expenses caused by soaring materials prices, delays in construction periods, soaring energy procurement costs, etc.
• Risk of profitability deterioration and delays in anticipated project schedule due to changes in economic conditions regarding projects with long-term project timeframes and large investment budgets, such as redevelopment projects(B) External risks• Risks arising from the impacts of prices for housing sales, property sales, as well as sale prices of asset replacement properties, due to changes in Japan’s real estate market and financial conditions• Risk arising from deterioration in profitability and delay in profit recovery timing in overseas business due to deterioration in economies and real estate markets, deterioration in the financial condition of general contractors
and JV partners, and other factors in countries overseas• Risk of a reduced competitive advantage of the Company’s businesses due to delays in response to changes in lifestyles and values, response to accelerating advances in digital technology, and response to sustainability
and human resources, etc.

(C) Disaster risks• Risk of inability to continue business due to increasingly severe natural disasters such as earthquakes, typhoons, and torrential rains(D) Internal risks• Risk due to inadequate design and construction in the real estate development business• Risk due to delay in preparing personnel systems to secure diverse human resources and enable human resources to continue playing an active role
• Risk due to information leak by cyberattack, impact on business continuity, and incurrence and expansion of damage, etc.
• Risk of violating laws and regulations and hindering the realization of smooth transactions with counterparties due to delays in strengthening the transaction system to realize the passing of appropriate price on to customers
in light of rising material prices, energy costs, among other costs.

The details of each major risk item and main initiatives are as follows.
(A) Investment risks: Risks related to individual investments (real estate investments, strategic investments (M&A), etc.)
Risk1) Risks associated with real estate investment

Risk details• Risk that the Group’s business performance, etc. may be affected as a result of delays in the timing of sales recording and deterioration of profitability due to unexpected discovery of soil pollution, delays in obtaining permits
and licenses, occurrence of additional construction work, and increases in construction and energy expenses.

Main initiatives

Decisions on the real estate investment/development business are made at the meetings such as the Management Committee or the Board of Directors of the Company or of group companies upon identifying, analyzing andevaluating risk in advance and considering risk taking or risk avoidance policies. Regarding the risk of an increase in construction expenses, the Company includes a certain amount of additional costs when acquiring land fordevelopment and carries out other measures.
Following the acquisition of the land for development, the department in charge of the business ascertains the risk of any schedule delay and the state of construction costs. Should an especially important event occur, after
deliberation by the Management Committee or the Board of Directors of the Company or group companies when necessary, the department shall respond to the issues.
In addition, for businesses that are in progress and completed, the progress of each business is monitored, and the results are reviewed so that issues and trends, etc., for each business type are grasped and analyzed.

Risk2) Risks associated with strategic investment (M&A) and new businesses

Risk details• Risk that the Group’s financial position and business performance, etc. may be affected if the Group fails to achieve profit growth or synergy expected by the target companies in which it invests in strategic investments (M&A).
• Risk that the Group’s financial position and business performance may be affected due to the inability to execute business according to original plans or achieve synergies with group companies in new businesses andinvestments in new asset types.

Main initiatives

In executing strategic investment (M&A), factors such as the synergies with the Group’s existing businesses, and business plans, financial details and contract-related matters of targeted companies shall be carefully examined
and considered and strategic investment (M&A) shall be implemented when it is determined that this will contribute to the Group’s business results in the future. In addition, after the M&A is executed, the Board of Directors or
the Management Committee shall regularly monitor the status of the integration process between the target company and the Group, management issues, and response policies.
In considering new businesses, the Company carefully investigates and examines the synergies with the Group’s existing businesses as well as business plans. A new business is commenced when judgement is made that
it will contribute to the business performance of the Group in the future. After entering a new business, its performance is regularly monitored, and if deemed necessary to make modifications or a re-start, it will put to deliberationby Management Committee or the Board of Directors of the Company or group companies.

(B) External risks: Risks related to external factors influencing business
Risk3) Risks associated with market changes

Risk details• Risk that the Group’s financial position and business performance, etc. may be affected by trends of competitors, the emergence of innovative new entrants, changes in economic, political, and social conditions, and theemergence of geopolitical risks, and the occurrence of disasters, etc., which may lead to changes in the business environment and market conditions.

Main initiatives

The Group regularly updates its awareness of the external environment of each business and works to ascertain impacts on business results, monitor the progress of business and improve precision.
When making investment decisions in the real estate investment/development business, our basic policy is to understand and forecast the current and future market conditions and confirm past market trends and curb to acertain extent the impact from changes in market conditions.
Moreover, we formulate an investment budget upon undertaking risk assessment to ensure a certain level of soundness regarding our financial position even if market conditions change rapidly.

Integrated Report 2023

77

Risk Management

Risk items

4) Risks caused by changes in economic conditions

Risk details• Risk that the Group’s financial position and business performance, etc. may be affected by a decline in customers’ purchase appetite in the housing sales business, a decline in the rent level of office buildings, etc., and anincrease in the vacancy rate due to domestic and overseas economic recessions.
• Risk that the Group’s financial position and business performance, etc. may be affected by an increase in the Group’s financing costs, a decline in customer desire to purchase in the housing sales business due to higher
housing loan interest rates, resulting from a rise in market interest rates, and a decline in asset prices owing to a rise in cap rates.
• Risk that the Group’s financial position and business performance, etc. may be affected by fluctuations in the amounts of investment and collection translated into yen and fluctuations in assets and liabilities denominated inforeign currencies on the consolidated financial statements, due to fluctuations in exchange rates.
• Risk that the Group’s financial position and business performance, etc. may be affected by deterioration in the profitability of overseas businesses and delays in the timing of collecting profits due to deterioration in the financial
condition of general contractors and JV partners in overseas countries, etc.

Main initiatives

Regarding changes in economic conditions, the Group regularly updates its awareness of the external environment and works to ascertain impacts on business results.
In our funding through borrowings, we respond to the risk of rises in short-term interest rates by using mainly long-term and fixed-rate borrowings.
In the real estate investment and development business, we make investment decisions that limit the impact to a certain extent even in the event of a decline in asset prices due to a decline in rents and a rise in cap rates.
For foreign exchange fluctuation risk, we have established a foreign exchange hedging policy that considers the types of businesses we undertake overseas and we operate in accordance with this policy.
In addition, with regard to the status of general contractors and JV partners in overseas business, in addition to regular monitoring by the front line, we regularly confirm and deliberate on events that affect our business andtheir responses through the Overseas Business Risk Committee (the name has changed from the Overseas Business Monitoring Committee), etc., and deliberate at the Management Committee or the Board of Directors of theCompany or group companies as necessary.

Highlights

Risk management structure that supports overseas business expansion
In the current Mid- to Long-term Business Plan, the Company is aiming to expand its Overseas Business profit ratio to 15% of total business profit by the fiscal
year ending March 31, 2031.
Planning to develop a more effective risk management system, the Company established the Overseas Business Monitoring Committee in April 2020 and has
been monitoring the status of businesses overseas.
In light of the expansion in the amount invested and the number of countries invested in, with the aim of more carefully assessing risk events by country andstrengthening our responses to them, we started holding meetings of the Overseas Business Risk Committee (formerly named the Overseas Business Monitoring
Committee) in May 2023 and are working hard to further enhance our risk management system.

Risk Management System in the Overseas Business
Operation Policies for Overseas Business Risk Committee

Board of Directors / Management Committee• Operation

ReportOverseas Business Risk Committee• Confirm the macro environment of each country and the state of advancement of each business• Deliberate individual risk response measures for each country and business
Report risks that require attention
and bring up potential problems

Corporate Department(2nd line) of
Nomura Real Estate Holdings/ Nomura Real Estate
Development

78

Guidance / Monitoring

Share information regarding themarket of each country and thestate of individual businesses

Identify risk items that require
stronger responses

Overseas Business Unit

We regularly collect, analyze, and share information between the 1st, 1.5, and2nd lines regarding the macro environment of each country and the state ofprogress of each business.
Matters confirmed as risks and issues that especially require attention arereported to this committee.

• Deliberation themes
We identify individual risk matters and issues that require stronger responses
for each country and business and deliberate response measures• Report to the Board of Directors and Management Committee
Report the content of discussions at this committee, individual risk items, andresponse measures

Planning Ofﬁce (1.5 line)

Main deliberation items in FY2023/3

Business Units and local
subsidiaries (1st line)• Progress of the housing sales business in Vietnam• The housing sales market in Vietnam• The financial position of general contractors in Thailand and Vietnam• The environment of the rental housing development business in the United States

Risk items

5) Risks caused by changes in political/social conditions/systems (laws, tax systems, accounting, others)

Risk details• Risk that the Group’s financial position and business performance, etc. may be affected by rising construction and energy expenses, the occurrence of delays in business schedule, etc., due to disruptions in the foreignexchange market, energy market, and supply chain in the event of changes to the political and social situations, such as the emergence of geopolitical risks, such as Russia’s invasion of Ukraine.
• In overseas business, risk that the Group’s financial position and business performance, etc. may be affected due to obstacles to promote business in case there are changes in political and social situations that have been
unexpected at the beginning of conducting business in each country, as there are risks specific to each country’s political and social situations.
• Risk that the Group’s financial position and business performance, etc. may be affected as a result of the occurrence of new obligations and expenses in case there are changes in various types of laws and regulations inJapan and overseas applicable to each of the Group’s businesses or other laws and regulations become applicable due to an expansion in the business scope in the future.
• Risk that the Group’s financial position and business performance, etc. may be affected as a result of increased costs for acquiring, holding, and selling assets, a decline in customer desire to purchase, a shift in corporate
facility strategy, and revision of investment plans in the case of changes to various tax systems and accounting systems in Japan and overseas that have an impact on the real estate business.

Main initiatives

We collect and analyze information on trends in political and social situations, various laws and regulations, tax systems and accounting systems in Japan and overseas from industry groups, external experts, business partners,
and consider responses at each of the Company’s respective organizations on the “second line” and discuss those matters expected to have a significant impact at the Board of Directors or the Management Committee
depending on the details.
In overseas business in particular, we seek the knowledge of external experts regarding the forecast of the future political and social situations as well as applicable laws, regulations and tax laws when starting a businessoverseas, and after starting a business we regularly confirm the state of changes to the political and social situations as well as important related laws and regulations that have an impact on business strategy, revenue andexpenditures, and progress in countries where we do business through the Overseas Business Risk Committee, etc. In the case that there are any changes, discussions are carried out at the Board of Directors or theManagement Committee upon evaluating the impact and discussing response policies.

Risk items

6) Risks from lagging behind innovation and changes in the social structure related to the business

Risk details• Risk that the Group’s financial position and business performance, etc. may be affected by a decline in the competitive advantage of the Company’s products and services if there are delays in responding to changes in thesocial structure and changes in the industrial structure resulting from rapid technological innovation and the emergence of innovative new participants.
• Risk that difficulties in securing human resources due to the declining birthrate and aging population will limit the Company’s ability to develop products and services.
• Risk that the Group’s financial position and business performance, etc., may be affected by a decline in the competitive advantage of the Company’s products and services if there are delays in responding to changes indemands related to the customer environment, energy conservation and disaster prevention resulting from the implementation and strengthening of greenhouse gas reduction regulations, etc., and technologies related tohigh environmental performance and energy performance.

Main initiatives

In the midst of a changing business environment, the Group has been creating new and highly unique value for society and customers by leveraging its strengths, such as real estate development capabilities based on the“market-in” concept and a commitment to quality in urban development and real estate-related services.
Drawing on these strengths, in order to respond to changes in social and industrial structure and the growing awareness of society and customers toward sustainability, we have established the DX & Innovation
Management Dept. and the Sustainability Management Dept., which are responsible for the research and development of new business fields, planning, and promotion of innovation creation, digital strategies, as well as initiatives
for sustainability, etc.
We have also established the “Business Idea Proposal System,” which allows employees of each Group company to propose new businesses, etc., beyond the boundaries of their daily work to promote the commercializationof new businesses and new products and services, with the DX & Innovation Management Dept. serving as the secretariat.
At the same time, through the Nomura Real Estate Group Awards, an internal award system, we are working to create a corporate culture that encourages the creation of value through innovation and to strengthen collaboration
within the Group. In addition, through the provision of corporate venture capital, the Company is collaborating with the startups that it has taken stakes in, which possess innovative technologies and services, continuing to provide
services that utilize these digital technologies.
Furthermore, in response to the difficulty of securing human resources, we are working to improve operational efficiency and conserve labor by utilizing digital technology.

Nomura Real Estate Holdings, Inc.

Introduction

Our Vision(To be)Our Current Strengths and Core(Strengths)

Our Challenges and Strategies(Actions)

The Foundation of Our Activities(Base)

Data, etc.

(C) Disaster risks: Risk generated by disasters that have a large impact on customers and business continuity
Risk items

7) Risks caused by disasters (earthquakes, typhoons, floods, tsunamis, volcanic eruptions, major fires, epidemics of infectious diseases, etc.) that have a major impact on customers and business continuity

Risk details• Risk of loss of earnings, such as decreases in leasing revenue and operational revenue due to the suspension of operations or restrictions on facilities that the Group owns and operates and a decrease in income due to theloss of business opportunities caused by disasters, including large earthquakes, storms and flood damage, and infectious disease epidemics.
• Risk of delay of earnings caused by issues, such as changes in sales recording period due to the suspension of operations for housing sales and changes in the timing of sales recording/completion due to the extension of
construction periods owing to such factors as suspension of construction by contractors caused by disasters, including large earthquakes, storms and flood damage, and infectious disease epidemics.

Main initiatives

The Group recognizes that the frequency of disasters has increased, and this is an important social issue. Based on discussions with government and disaster preparedness experts, we are working to ensure the safety andsecurity in the event a disaster occurs. We engage in disaster preparedness activities to ensure that, if a disaster occurs, its impact is minimized and the Group and its employees are able to continue business and their normal
lives. We have formulated a business continuity action plan (BCP) in the event of a disaster.
In preparing for an earthquake, and storm and flood damage, under the BCP we have determined an emergency chain of command, assigned duties to ensure business continuity, and established a system to minimize theimpact of disasters. Once per year we hold Disaster Task Force Establishment Drills to ensure the prescribed details are effective, ensuring the safety of executives and employees and establishing a chain of command system,so that we are prepared for restoring business after an emergency. Concerning infectious diseases, based on the Group’s response results to novel coronavirus infections (COVID-19), we have formulated a BCP for infectious
diseases that summarizes responses according to the infection situation (establishment of a chain of command system, selection of core businesses for business continuity, formulation of common rules for infection prevention,etc.) from the time of infection confirmation to the spread of new infectious diseases in preparation for the emergence of new infectious diseases in the future. We have also formulated a BCP that stipulates preparations andinitial responses to disasters not only in Japan but also overseas.
Regarding earthquakes, fires, storms, floods, and other sudden accidents, we have set up regulations for responses to torrential rains and flooding, formulated a disaster response manual, and created a disaster preparedness
guidebook for distribution to residents, management associations, tenants, and facility users in the properties we own to ensure their safety and bring them peace of mind when a disaster occurs.

(D) Internal risk: Operational risks occurring at the Company and each group company
Risk items

8) Risks of the violation of laws and ordinances

Risk details• Risk that the business performance may be affected by violation of the Real Estate Brokerage Act, the Building Standards Act, the Financial Instruments and Exchange Act, Companies Act, Act on the Protection of Personal
Information, Antimonopoly Act, Subcontract Act, and other related laws and regulations, resulting in loss of credibility and the imposition of administrative penalties and fines, etc.

Main initiatives

The Group has formulated the Nomura Real Estate Group Code of Action for executives and employees to comply with laws and regulations and internal rules, and act with higher ethical standards, and it also has provided
education on an ongoing basis.
For primary laws such as the Real Estate Brokerage Act, we formulate a business work flow specific to each law to ensure legal compliance, ensure a thorough awareness through training and on-the-job training (OJT), andimplement regular voluntary inspections for the status of compliance. Concerning the Antimonopoly Act, etc., in order to realize an appropriate passing of price increases on to customers that takes into account increases inmaterial prices, energy costs, etc., we are working to strengthen our trading system by formulating business rules according to the business characteristics and the scale of each Group company’s business, creating manuals,
and conducting training. In addition, regarding the inappropriate entertainment of foreign public officials and other civil servants, the Company has established regulations, etc. The Company is implementing regular training forexecutives, employees and overseas local hires related to overseas businesses.

Risk items

9) Risks of quality defectRisk details• Risk that the business performance may be affected by the loss of trust, unexpected costs and delays in development plans and operation plans due to management deficiencies such as design and construction defects,
etc. in the real estate development business or in the case of a management deficiency in the properties for leasing or under management.

Main initiatives

In the real estate development business, to secure quality in design and construction upon placing an order for the design and construction work of a building with a third party who has a certain level of creditability and technicalcapabilities, the Group prescribed the Design and Construction Standards (structure, construction, equipment, and electrical), the Quality Manuals, etc. and ensure thorough compliance from the parties while also checking thestate of construction and carrying out quality inspections as the ordering party (However, in joint ventures with other companies and redevelopment projects led by redevelopment associations, different methods may be adopted
depending on the business form.) Regarding leased and managed properties, we will prepare business standard documents related to property management and safety and temporary construction guidelines for repair work
as we undertake business. We will also provide property insurance for damages in the unlikely event of a deficiency or accident.

Risk items

10) Risks of occurrence of information system crisis

Risk details• Risk that the Group’s business performance, etc. may be affected as a result of the delays in the Group’s sales activities and business processing and the loss of credibility, and the resulting decrease in sales and damage
compensation costs in the unlikely case the Company’s information system cannot be used normally or in case personal information is leaked to the outside due to unexpected circumstances such as cyberattacks andunauthorized access.

Main initiatives

In a situation where we are actively promoting DX initiatives to realize business transformation and sustainable growth using the Internet and cloud services, ensuring information security is becoming more critical than ever.
We have installed security systems that block unauthorized access from the Internet, scan information terminals for viruses, and detect the behavior of malware, bots, and other intruders to prevent unauthorized transmission
if they enter. In addition, alerts from these systems are monitored to ensure that the ICT environment is prepared for cyber-attacks and information leaks. Also, security checks are conducted prior to the use of cloud services
to ensure that they are used safely.
The Company is also striving to comply with relevant laws and regulations for personal information and to ensure proper handling of this information. Moreover, with the aim of realizing organized management of informationand maintaining and improving security levels within the Group, we have prescribed the Information Security Regulations and the Information Handling Guidelines, regularly provide information security enlightenment to ouremployees, protect the rights and interests of our customers and ensure the stable operation of an ICT environment within the Group.
In addition, the Company has cyber insurance in preparation for an unlikely accident such as an information leakage.

Risk items

11) Risks of inadequate responses to matters related to human resources

Risk details• Risk that long working hours damage the health of employees in the event that the working hours of Group employees are not properly ascertained.
• Risk that the Group’s business performance, etc. may be affected as a result of the outflow of the Group’s human resources, the loss of trust, and the imposition of fines in case we receive administrative sanctions fromgovernment authorities because our personnel system and its operation do not comply with labor standards and related laws and regulations.
• Risk that delays in the establishment of a labor environment that takes in a diverse range of human resources (employees that work short hours mainly due to childcare and nursing, sexual minorities, people with disabilities,
seniors, foreign nationals and others) may result in the Group being unable to secure the necessary personnel, or the inability of secured personnel to continue working, leading to a decline in corporate competitiveness.
• In terms of personnel and labor management at overseas bases, risk of administrative sanctions by government authorities for introducing or operating a system that violates local labor laws and customs, risk of losing
know-how due to the retirement of local employees, and risk that the health of employees will be damaged due to the lack of systems to provide appropriate support for living in a foreign country.

Main initiatives

The Group prescribes working with vigor and achieving wellness as its action guideline. The Group aims to provide wellness management so that all its executives and employees can carry out their work energetically and ingood physical and mental health, which leads to sustainable corporate growth.
Along with introducing various systems, including recommendations to take paid leave, the promotion of teleworking, and a program for taking time off or working shorter hours for childcare and nursing and to build a labor
environment conducive for a diverse workforce, we are working to improve the level of understanding related to diversity among executives and employees through regular training sessions. In addition, some group companies,
such as Nomura Real Estate Development, have partially implemented paid leave for male employees’ birth childcare leave and introduced an accumulated paid leave system.
In order to properly grasp working hours, we have introduced an attendance management system to manage it, and especially for long working hours, we regularly monitor the situation. Furthermore, the compliance of ourpersonnel system and its operation is regularly verified by outside experts to prevent the emergence of risks.
Moreover, overseas there are local laws, cultures, and customs. Therefore, we utilize the knowledge of external experts to build personnel/labor systems, establish consultation desks for staff stationed overseas, and provide
services to help the staffs find, and provide support for visits to, medical institutions.
The Group established the Wellness and D&I Management Committee, which is chaired by the President and Executive Officer (Group CEO), in order to integrally promote wellness, work-style reforms and the ensuring ofdiverse human resources, and the Wellness and D&I Management Sect. in the Group Human Resources Development Dept. as the dedicated organization for the promotion of diversity & inclusion. From this fiscal year, wehave formulated and announced the Group’s D&I promotion policy and medium- and short-term promotion roadmap to determine the “D&I awareness development period” as Step 1 until the fiscal year ending March 2024,
and set key goals of “(1) Achieving the target for taking annual paid leave and (2) Achieving the 100% rate of the childcare leave rate for male and female employees.”

Risk items

12) Risks of occurrence of fraud and negligence

Risk details• Risk that the business performance may be affected as a result of the loss of credibility and the resulting decrease in sales and damage compensation costs due to fraud perpetuated by executives and employees, information
leakage due to improper management, and operational negligence.

Main initiatives

Group executives and employees comply with laws and regulations as well as with the internal rules, etc. established by each company of the Group. Furthermore, we have established the Nomura Real Estate Group Code of
Ethics with the aim of acting in accordance with even higher ethical standards, and we continuously provide education and training sessions to executives and employees.
In addition, the Company has established a system to enhance the effectiveness of compliance activities in each workplace by assigning a compliance promotion officer to each department, office and branch of theCompany and Group companies. Furthermore, with the “Nomura Real Estate Group Risk Helpline,” an internal whistleblowing system shared by all Group companies, the Company has set up internal and external contact
points for reporting wrongdoing and seeking advice on how to proceed, and has developed and implemented systems based on the Whistleblower Protection Act.

Integrated Report 2023

79

Internal Controls, Compliance/Information Disclosure

Compliance systems
The Group regards compliance, including the observance of laws andregulations and corporate ethics, as one of our most importantmanagement issues. As a set of relevant guidelines, the Company has
formulated the Nomura Real Estate Group Code of Action. We haveestablished the Risk Management Committee and Group Legal &Compliance Department in the Company to promote continuous
education and enlightening activities for the executives and employeesof the entire Group, and to provide advice, guidance, and support toGroup companies.
Furthermore, based on our priority of collecting information regarding
risks, the Company has set up the Nomura Real Estate Group
Helpline as a point of contact for internal reporting by Group employees.
The Company imposes a confidentiality obligation on employees whoare involved in the helpline business and prohibits unfair treatment forreporting an incident using the helpline.
In an attempt to enhance its efforts, the Group signed and registeredas a participating company in the United Nations Global Compact in
May 2019. Based on the principles of the United Nation’s global
initiatives, the Group will remain committed to all types of anti-corruption
activities, including extortion and bribery.

Compliance system
Nomura Real Estate Holdings

About the Risk
Management Committee
ReportBoard of Directors
Management
Committee

President

ReportGroup Compliance Ofﬁcer
Committee
ChairmanGroup Legal & ComplianceDepartment

Risk Management
Committee

Secretariat

Compliance Ofﬁcers(Directors and officers of general administrative operations at Group companies)

Compliance Leaders• Held every two months inprinciple• Extraordinary meetings held
as necessary• Reports to the Board of
Directors/Management
Committee at least once
every three months• Roles• Regular monitoring of risks• Risk evaluation and analysis• Preemptive and preventive
measures• Incident response• Measures to prevent repeat
incidents• Improvement of complianceawareness

Risk
Management
Committee, etc.

(General managers of general administrative operations at Group companies)

The Nomura Real Estate Group Code of Action
https://www.nomura-re-hd.co.jp/english/sustainability/base/compliance.html

Compliance Promoters(Appointed at each company)

Nomura Real Estate Group Companies

Appropriate information disclosure and transparency
The Company strives to disclose information about the Group’s
management strategy, financial condition, risk management, andinternal control system, etc., in a fair, timely, and appropriate mannerbased on the provisions of the Companies Act and the Financial
Instruments and Exchange Act as well as other laws and the listing
rules of the Tokyo Stock Exchange. Specifically, as our timely disclosuresystem (on the right) indicates, the person responsible for information
handling (executive officer in charge of the Corporate
Communications Department) collects information about theCompany through the Department responsible for information collection(Corporate Planning Department). As for information requiring timely
disclosure, the Information Disclosure Screening Team, which is madeup of general managers, executive officers, and others responsible inrelated departments, will screen the matter and report the results to
the President. Company information found to require timely disclosure
will be disclosed in a timely manner by the Department responsible fortimely disclosure (Corporate Communications Department) at the
instruction of the person responsible for information handling (executive
officer in charge of the Corporate Communications Department).
The Group Internal Audit Department carries out the monitoring ofoperations under the aforementioned timely disclosure system. Audit& Supervisory Committee Members attend Board of Directors andother important Company meetings as well as receive reports fromdirectors and view relevant documents to investigate whether thetimely disclosure system is functioning properly.

80

Nomura Real Estate Holdings, Inc.

Timely disclosure system
President
ReportInformation Disclosure
Screening Team
(Made up of generalmanagers, executive officers,
and others responsible forrelated departments)

FormedasneededTokyo Stock Exchange
Timelydisclosure

Person responsible for
information handling(executive officer in chargeof the Corporate
Report Communications Department)

Risk Management
Committee

Department responsible
for timely disclosure
Instruction (Corporate Communications
Department)

ChairmanReportDepartment responsiblefor information collection
Incidents withsignificant urgency

Report(Corporate Planning
Department)

ReportDepartments of
Nomura Real Estate HoldingsGroup companies

Introduction

Our Vision(To be)Our Current Strengths and Core(Strengths)

Our Challenges and Strategies(Actions)

The Foundation of Our Activities(Base)

Data, etc.

Shareholder engagement
Based on its policies regarding the development of systems and theimplementation of initiatives to facilitate shareholder dialogue, theCompany conducts proactive and constructive engagement withshareholders. The director in charge of investor relations (the GroupCFO) takes the lead in engaging with shareholders, while the Investor
Relations Section of the Corporate Communications Department
supports these efforts. At the financial results briefings, the GroupCEO explains business results and future strategies. The Investor
Relations Section meets with internal departments and sharesinformation on a daily basis to gather information and promote

engagement with shareholders. The director in charge of investor
relations reports the views and concerns of shareholders found during
the engagement to the executive management team and regularly
reports to the Board of Directors, which discusses this information.
We established Regulations Concerning the Prevention of Insider
Trading to ensure the fairness of information disclosures and prevent
leakages of information that affect our stock price. We manage insider
information appropriately according to these regulations, and a silent
period was also established.

Current status of investor relations activities
To attract more shareholders and prospective investors, the IR
Section of the Corporate Communications Department plays a central
role in enhancing understanding of the Group's business activities andgrowth strategy through direct and indirect communications with both
institutional and individual investors.
To deepen the understanding of a wide range of investors about
the Company’s business and management strategies, we actively
participate in online briefings and IR fairs via the Internet.

Major IR activities during FY23/3
IR activities for institutional investors
Financial results briefings(Including Conference calls on financial results announcement days)
Business briefings for analysts and investors
Meetings with analysts and investors (including the following meetings)

Number oftimes held
41
396

Conferences organized by securities companies

11

CEO small meeting1

CFO small meeting1

ESG meetings

19

IR activities for individual investors

Number oftimes held

Conferences for individual investors

1

Online briefing

1

An online briefing for individual investors

For further details and the latest information, visit the IR site.
Japanese https://www.nomura-re-hd.co.jp/ir/
Englishhttps://www.nomura-re-hd.co.jp/english/ir/

Integrated Report 2023

81

Directors and Executive Officers(As of June 23, 2023)

Directors
Eiji Kutsukake

Satoshi Arai

Daisaku Matsuo

Date of Birth: September 12, 1960

Date of Birth: June 3, 1965

Date of Birth: October 18, 1964

Chair and Director
Chair of the Board of Directors
Advisory Committee Relating toNominations and Compensation
MemberPresident and Representative
Director, and Chief Executive Ofﬁcer
Group CEO

Executive Vice President andRepresentative Director, andExecutive Ofﬁcer
Group COO

Number of shares held: 7,300*

Number of shares held: 24,200*

Executive

Number of shares held: 25,200*

Executive

Non-executive
Apr. 1984 Joined Nomura Securities Co., Ltd. (currently, Nomura Holdings, Inc.)
Apr. 2007 Executive Managing Director of Nomura Securities Co., Ltd.
Oct. 2008 Senior Managing Director of Nomura Securities Co., Ltd.
Apr. 2009 Senior Corporate Managing Director of Nomura Securities Co., Ltd.
Apr. 2011 Senior Corporate Managing Director of Nomura Holdings, Inc.
Executive Vice President of Nomura Securities Co., Ltd.
Apr. 2012 Executive Managing Director of Nomura Holdings, Inc.
Aug. 2012 Deputy President of Nomura Securities Co., Ltd.
Apr. 2013 Director and Deputy President of Nomura Securities Co., Ltd.
Apr. 2014 Advisor of Nomura Real Estate Holdings, Inc.
Jun. 2014 Representative Director and Executive Vice President of Nomura
Real Estate Holdings, Inc.
Jun. 2015 President and Representative Director, and Chief Executive Officer
of Nomura Real Estate Holdings, Inc.
Apr. 2017 Chair and Representative Director of Nomura Real Estate
Development Co., Ltd.
Apr. 2023 Chair and Director of Nomura Real Estate Holdings, Inc. (present)
Director of Nomura Real Estate Development Co., Ltd. (present)

Apr. 1988 Joined Nomura Securities Co., Ltd. (currently, Nomura Holdings, Inc.)
Apr. 2011 Senior Managing Director of Nomura Securities Co., Ltd.
Apr. 2014 Senior Corporate Managing Director of Nomura Securities Co., Ltd.
Apr. 2017 Senior Managing Director of Nomura Holdings, Inc.
Executive Managing Director and Executive Vice President of
Nomura Securities Co., Ltd.
Apr. 2018 Senior Managing Director of Nomura Holdings, Inc.
Supervisor of Management Division
Apr. 2019 Representative Director and Deputy President of Nomura Securities
Co., Ltd.
Apr. 2022 Advisor of Nomura Real Estate Holdings, Inc.
Director of Nomura Real Estate Development Co., Ltd.
Jun. 2022 Executive Vice President and Director of Nomura Real Estate
Holdings, Inc.
Apr. 2023 President and Representative Director, Chief Executive Officer, andGroup CEO of Nomura Real Estate Holdings, Inc. (present)
Chair and Representative Director of Nomura Real Estate
Development Co., Ltd. (present)

Apr. 1988 Joined Nomura Real Estate Development Co., Ltd.
Apr. 2012 Executive Officer of Nomura Real Estate Development Co., Ltd.
Apr. 2015 Managing Executive Officer of Nomura Real Estate Development
Co., Ltd.
Apr. 2018 Executive Officer of Nomura Real Estate Holdings, Inc.
Business Unit Manager of Residential Development Business Unit
Director and Senior Managing Executive Officer of Nomura Real
Estate Development Co., Ltd.
Apr. 2021 Executive Vice President of Nomura Real Estate Holdings, Inc.
President and Representative Director, and Chief Executive Officer
of Nomura Real Estate Development Co., Ltd. (present)
Jun. 2021 Executive Vice President and Representative Director, andExecutive Officer of Nomura Real Estate Holdings, Inc. (present)
Apr. 2022 Executive Vice President and Representative Director, Executive
Officer, and Group COO of Nomura Real Estate Holdings, Inc. (present)

Hiroyuki Kimura

Yasushi Takayama

Yoshio Mogi

Date of Birth: March 30, 1962

Date of Birth: February 1, 1964

Date of Birth: April 10, 1952

Director (Audit & Supervisory
Committee Member)
Chair of Audit & Supervisory
Committee

Director (Audit & Supervisory
Committee Member)

Director (Audit & Supervisory
Committee Member)
Advisory Committee Relating toNominations and Compensation
MemberNumber of shares held: —*Non-executive

Number of shares held: 26,400*

Number of shares held: —*Non-executive

Non-executive External Director
Independent Director
Apr. 1984 Joined Nomura Real Estate Development Co., Ltd.
Apr. 2009 Executive Officer of Nomura Real Estate Development Co., Ltd.
Jun. 2009 Director of Nomura Real Estate Holdings, Inc.
Apr. 2010 Director of Nomura Real Estate Asset Management Co., Ltd. (currently, Nomura Real Estate Asset Management Co., Ltd.)
Oct. 2011 Managing Director of Nomura Real Estate Asset Management Co., Ltd.
May 2012 Executive Officer of Nomura Real Estate Holdings, Inc.
Jun. 2012 Director and Executive Officer of Nomura Real Estate Holdings, Inc.
Apr. 2013 Director and Managing Executive Officer of Nomura Real Estate
Development Co., Ltd.
Jun. 2013 Executive Officer of Nomura Real Estate Holdings, Inc.
Apr. 2014 Executive Officer and CFO of Nomura Real Estate Holdings, Inc.
Jun. 2014 Director, Executive Officer, and CFO of Nomura Real Estate
Holdings, Inc.
Apr. 2017 Director, Executive Officer, and Group CFO of Nomura Real Estate
Holdings, Inc.
Apr. 2019 Director of Nomura Real Estate Holdings, Inc.
Executive Vice President and Representative Director of Nomura
Real Estate Asset Management Co., Ltd.
Apr. 2021 Advisor of Nomura Real Estate Holdings, Inc.
Audit & Supervisory Board Member of Nomura Real Estate
Development Co., Ltd. (present)
Jun. 2021 Director (Audit & Supervisory Committee Member) of Nomura Real
Estate Holdings, Inc. (present)

Apr. 1988 Joined Nomura Securities Co., Ltd. (currently, Nomura Holdings, Inc.)
Jun. 2011 Director, Nomura Financial Products & Services, Inc.
Oct. 2012 Managing Director and General Counsel of Nomura Securities
International, Inc. (New York)
Sep. 2013 Managing Director and General Counsel of Nomura Holding
America Inc.
Apr. 2015 Senior Managing Director and Chief Legal Officer of Nomura
Holdings, Inc.
Senior Managing Director and Chief Legal Officer of Nomura
Securities Co., Ltd.
Jun. 2016 Outside Director of Japan Securities Depository Center,
Incorporated
Apr. 2019 Advisor of Nomura Real Estate Holdings, Inc.
Audit & Supervisory Board Member of Nomura Real Estate
Development Co., Ltd. (present)
Jun. 2019 Director (Audit & Supervisory Committee Member) of Nomura Real
Estate Holdings, Inc. (present)
Audit & Supervisory Board Member of Nomura Real Estate AssetManagement Co., Ltd. (present)

Apr. 1975 Joined Nichimen Co., Ltd. (currently, Sojitz Corporation)
Apr. 2006 Executive Officer of Sojitz Corporation
Apr. 2008 Managing Executive Officer of Sojitz Corporation
Apr. 2012 Senior Managing Executive Officer, CFO of Sojitz Corporation
Jun. 2012 Representative Director, Senior Managing Executive Officer, CFO of
Sojitz Corporation
Apr. 2014 Representative Director and Executive Vice President, CFO of
Sojitz Corporation
Jul. 2014 Outside Director of Sojitz Infinity Inc.
Apr. 2017 Representative Director and Executive Vice President, CCO of
Sojitz Corporation
Director of Sojitz REIT Advisors K.K.
Apr. 2018 Advisor of Sojitz Corporation
Jun. 2019 External Director (Audit & Supervisory Committee Member) of
Nomura Real Estate Holdings, Inc. (present)

Executive officers (excluding those who are concurrently serving as directors)

82

Shigeyuki Yamamoto

Kenichi Maeda

Koki Miura

Haruhiko Nakamura

In charge of Development Planning

In charge of Property Brokerage & CRE Business Unit

In charge of Investment Management Business Unit

In charge of Residential Development Business Unit

Yukio Ichihara

Motomi Uki

Takayuki KajiToshihide Tsukasaki

In charge of Internal audit and Compliance, Group Internal
Audit Dept., Group Legal & Compliance Dept., ICTManagement Dept., Group Corporate Administration Dept.,
Secretariat,

In charge of Group Human Resources Dept., Group
Human Resources Development Dept.

In charge of Business Creation

Group CFOIn charge of Investor Relations, Finance & Accounting
Dept., Finance Dept.

Nomura Real Estate Holdings, Inc.

Introduction

Our Vision(To be)Makoto Haga

Our Current Strengths and Core(Strengths)

Our Challenges and Strategies(Actions)

Hiroshi Kurokawa

The Foundation of Our Activities(Base)

Data, etc.

Chiharu Takakura

Date of Birth: June 22, 1966

Date of Birth: February 2, 1968

Date of Birth: December 22, 1959

Executive Vice President andRepresentative Director, andExecutive Ofﬁcer
Supervisor of Management Division

Director and Executive Ofﬁcer
Business Unit Manager ofCommercial Real Estate Business Unit

Director
Number of shares held: —*Non-executive External Director
Independent Director
Newly appointed

Number of shares held: 10,200*

Number of shares held: 31,800*

Executive

Executive

Apr. 1989 Joined Nomura Real Estate Development Co., Ltd.
Oct. 2011 Director of Nomura Real Estate Asset Management Co., Ltd.
Apr. 2012 Executive Officer of Nomura Real Estate Development Co., Ltd.
May 2012 Executive Officer of Nomura Real Estate Holdings, Inc.
Apr. 2015 Managing Executive Officer of Nomura Real Estate Development
Co., Ltd.
Apr. 2017 Executive Officer of Nomura Real Estate Holdings, Inc.
Supervisor of Management Division
Director and Managing Executive Officer of Nomura Real Estate
Development Co., Ltd.
Jun. 2017 Director and Executive Officer of Nomura Real Estate Holdings, Inc.
Supervisor of Management Division
Apr. 2019 Director, Executive Officer, and Group CFO of Nomura Real Estate
Holdings, Inc.
Supervisor of Management Division
Apr. 2020 Director and Senior Managing Executive Officer of Nomura Real
Estate Development Co., Ltd.
Apr. 2021 Director and Executive Officer of Nomura Real Estate Holdings, Inc.
Business Unit Manager of Commercial Real Estate Business Unit
Apr. 2023 Executive Vice President and Representative Director, andExecutive Officer of Nomura Real Estate Holdings, Inc.
Supervisor of Management Division (present)
Executive Vice President and Representative Director, and Executive
Officer of Nomura Real Estate Development Co., Ltd. (present)

Apr. 1990 Joined Nomura Real Estate Development Co., Ltd.
Apr. 2013 Executive Officer of Nomura Real Estate Development Co., Ltd.
Apr. 2015 Representative Director and Senior Managing Executive Officer of
Nomura Real Estate Asset Management Co., Ltd.
Apr. 2017 Executive Officer of Nomura Real Estate Holdings, Inc.
Managing Executive Officer of Nomura Real Estate Development
Co., Ltd.
Apr. 2020 Senior Managing Executive Officer of Nomura Real Estate
Development Co., Ltd.
Apr. 2021 Executive Officer and Group CFO of Nomura Real Estate Holdings, Inc.
Supervisor of Management Division
Director and Senior Managing Executive Officer of Nomura Real
Estate Development Co., Ltd. (present)
Jun. 2021 Director, Executive Officer, and Group CFO of Nomura Real Estate
Holdings, Inc.
Supervisor of Management Division
Apr. 2023 Director and Executive Officer of Nomura Real Estate Holdings, Inc.
Business Unit Manager of Commercial Real Estate Business Unit
(present)

Akiko Miyakawa

Tetsu Takahashi

Date of Birth: October 18, 1955

Date of Birth: October 24, 1956

Director (Audit & Supervisory
Committee Member)

Director (Audit & Supervisory
Committee Member)
Chair of Advisory Committee Relating
to Nominations and Compensation

Number of shares held: —*Non-executive External Director
Independent Director

Apr. 1983 Joined Economic Affairs Bureau of Ministry of Agriculture, Forestry
and Fisheries
Aug. 1993 Joined Sanwa Research Institute Corp.
Jul. 1999 Joined Pfizer Japan Inc.
Oct. 2006 Joined Novartis Pharma K.K.
Oct. 2013 Managing Executive Officer of Nihon Tetra Pak K.K.
Jul. 2014 Corporate Fellow and General Manager of Global Human
Resources Dept. of Ajinomoto Co., Inc.
Apr. 2020 Joined ROHTO Pharmaceutical Co., Ltd.
Jun. 2020 Director of ROHTO Pharmaceutical Co., Ltd.
Jun. 2021 Outside Audit and Supervisory Board Member of NGK SPARK PLUG
Co., Ltd. (currently, Niterra Co., Ltd.)Mar. 2022 Director and Chief Human Resource Officer (CHRO) of ROHTO
Pharmaceutical Co., Ltd.
Jun. 2022 Outside Director of NGK SPARK PLUG Co., Ltd. (currently, NiterraCo., Ltd.) (present)
Jun. 2023 External Director of Nomura Real Estate Holdings, Inc. (present)

Number of shares held: —*Non-executive External Director
Independent Director

Apr. 1978 Joined Tokyo Branch of Chase Manhattan Bank (currently,
JPMorgan Chase Bank, N.A.)
Nov. 1987 Joined Marunouchi & Co. (currently, Deloitte Touche Tohmatsu LLC)
Jan. 2000 Joined the Los Angeles Office of Deloitte US
Jun. 2005 Partner of Deloitte Touche Tohmatsu LLC
Jul. 2008 Joined the Taipei Office of Deloitte Taiwan
Oct. 2015 Joined Deloitte Touche Tohmatsu LLC Tokyo Office
Aug. 2018 Representative of Akiko Miyakawa CPA Office (present)
Jun. 2019 External Director (Audit & Supervisory Committee Member) of
Nomura Real Estate Holdings, Inc. (present)

Apr. 1986 Registered with Tokyo Bar Association
Joined Miyakezaka Law Offices
Jul. 2003 Representative Partner of KASUMIGASEKI PARTNERS LAW OFFICE
Mar. 2006 Outside Audit & Supervisory Board Member of Apple Japan Co., Ltd.
Mar. 2007 External Director of McDonald’s Holdings Company (Japan), Ltd.
External Director of McDonald’s Company (Japan), Ltd.
Jun. 2007 Outside Audit & Supervisory Board Member of Gro-Bels Co., Ltd.
Oct. 2007 Outside Audit & Supervisory Board Member of Bit-isle Inc.
(currently, Equinix, Inc.)
Jan. 2012 Outside Audit & Supervisory Board Member of Boox Co., Ltd.
(currently, eBOOK Initiative Japan Co., Ltd.)
Feb. 2012 Outside Audit & Supervisory Board Member of ZOOM CORPORATION
Jun. 2015 Outside Director (Audit and Supervisory Committee Member) of
ZOOM CORPORATION
Oct. 2016 Outside Audit & Supervisory Board Member of eBOOK Initiative
Japan Co., Ltd.
Jun. 2020 External Director (Audit & Supervisory Committee Member) of
Nomura Real Estate Holdings, Inc. (present)
Dec. 2020 Executive Partner of ITN Partners (present)
Mar. 2022 External Director of McDonald’s Holdings Company (Japan), Ltd.
(present)

Tetsumi Yoshimura

Kazuhiro Toida

Masato Yamauchi

In charge of Quality Management and Architectural Design

In charge of Property & Facility Management Business Unit

In charge of Overseas Business Unit, Overseas BusinessJoji Yamada

Katsuya Tanaka

Naoko Usami

In charge of Corporate Planning Dept., Group Head Office
Relocation Planning Dept., DX & Innovation Planning Dept.

In charge of Sustainability Management, Corporate
Communications Dept., Sustainability Management Dept.

In charge of Group Diversity and Inclusion Management,
General Manager of Group Human Resources
Development Dept.

* As of March 31, 2023
Note: Chiharu Takakura, Yoshio Mogi, Akiko Miyakawa, andTetsu Takahashi are external directors as prescribedin Article 2, Item 15 of the Companies Act.

Integrated Report 2023

83