The Daiwa Securities Group is committed to creating a workplace that its employees strongly feel is worth working for, and can take on new challenges in their work with high motivation.

   In July 2006 and March 2007, the Daiwa Securities Group set the target of being the top securities group in Japan, full of motivation and passion. We have created a company vitalization program to be a company that highly motivates its employees and creates greater job satisfaction. We implement a number of measures, including expansion of female employees support plan, enhancements to mental healthcare, and a career path for temporary employees to become permanent employees, so that everyone working in our Group will (1) feel confident in the company; (2) have pride in their work, with an understanding of the role and significance of the business; and (3) share a sense of solidarity with the company and their coworkers.

   Daiwa Securities Group believes that in order to increase employees who share the feeling of confidence and pride in the company and a sense of solidarity, we must offer them long-term employment. For this reason, we create a system of hiring and employment contracts that primarily focus on long-term employment.
   In April 2007, we hired 1,423 new graduates. This was the largest number of new-graduate hires in the securities industry. We expanded communications in our hiring process through seminars, small meetings, and the like, in order to improve the mutual understanding between students and our company. This effort also improved our score in rankings of companies that students most want to work for.
   We have also created a new program that offers a career path for temporary employees to become full-time employees. In fiscal 2006, more than 100 temporary employees became full-time employees through this program. We will also continue to periodically elevate temporary employees to full-time status. We also conducted broad, nationwide efforts to hire persons with disabilities, with a focus on the sales branches of Daiwa Securities Co. Ltd. As of end-March 2007, persons with disabilities accounted for 1.95% of our workforce, averaged across nine group companies. This is a 0.1% increase from fiscal 2006. In fiscal 2007, we will actively begin hiring new graduates with disabilities as well.

   Daiwa Securities Group has a wide range of training and other programs aimed at improving skills, with the goal of making us the number-one professional team in the industry. We have a highly effective training program that tailors training to the audience and context, including training for specific positions and career stages (such as new hires), executive and management training, and selective training. We have an especially complete program for the first three years after hiring, identifying this as the period for acquiring a broad range of knowledge and skills.
   We have also introduced set certification requirements for employee promotions and advancement. The system works by giving employees points for obtaining certifications appropriate for securities business, such as securities analyst and financial planner, and requiring a certain minimum number of points in order to be promoted to such positions as general manager. The system was announced in 2005, and will go into effect in June 2008. Partly due to the effects of this program, the number of employees with securities analyst, financial planner, and similar certifications has risen, and the program has shown significant success at its original goal: motivating employees to voluntarily and continuously study.

   The Daiwa Securities Group's internal (intra-Group) job postings have been in place since fiscal 2000. This facilitates personnel transfer across the group companies, allowing employees the opportunity to explore different career options and realize their capabilities to the fullest. In the fall of 2006, 6 out of 47 applicants were successful, while 3 of 29 made it in the spring of 2007. There have been a total of 648 applicants since 2000, with a total of 123 successful transfers.
   The Group offers examinations for those in non-career-track jobs to move into a career-track job and regional career-track jobs.

Successful applicants for internal recruiting system (Unit: persons)

   In order to make its evaluation system fairer and more acceptable to employees, we implement a "two-way evaluation system" in which superiors and subordinates evaluate each other, and a "multi-directional evaluation system," evaluates are received from collaborating departments. These evaluation systems are used when making personnel-transfer, promotion, and advancement. Evaluations are multi-faceted, also taking compliance-related performance into account.

Number of new graduates hired in Daiwa Securities Group (consolidated bases)   (persons)

*1 Regional career-track employees make up a class of career-track employees who stay in one region and are not subject to transfers that require a change of residence. Full-scale hiring of new graduates into this class began in April 2002.
*2 Financial advisors are employees who work in sales at Daiwa Securities Co. Ltd., under one-ear contracts.

Persons earning credentials (nine principal group companies)   (persons)

Employees at Daiwa Securities Group (consolidated bases)   (persons)

*1Temporary employees are part-time hires; the figure shown here is the average number of such employees over the year. This class of employees is mostly made up of women.
*2Includes regional career-track employees and specialist positions.

Basic employee statistics (Daiwa Securities Group Inc.)

* Average annual salary includes bonuses and other forms of additional remuneration.

Employment rate for persons with disabilities (average across the nine principal group companies, as of the end of each fiscal year)

   The Daiwa Securities Group actively supports its female employees. We have introduced a wide range of programs enabling our female employees to achieve a work-life balance, including the introduction of the Female Employee Support Plan, led by the Women's Support Action Team, which is located in the Personnel Department of Daiwa Securities Group Inc. We actively hire women, confident in the ability of female employees to shine in the workplace. The number of women hired by the Group increases each year, and we actively promote female employees to management positions. In June 2006, Daiwa Securities Group Inc., Daiwa Securities Co. Ltd., and Daiwa Securities SMBC Co. Ltd. won the Tokyo Labor Bureau Chief Award of Excellence in the fiscal 2006 Corporate Equal Opportunity Awards conducted by the Ministry of Health, Labor and Welfare in recognition of the three companies' support for the advancement of women.

   In order to provide female employees the support needed to fulfill both work and family obligations, the Daiwa Securities Group introduced a Female Employee Support Plan in October 2005.The Group initially offered its employees two years of childcare leave, exceeding the legally mandatory one and a half years. The Group has now extended this period to three years. Further, it introduced a childcare cost assistance scheme and other programs to help cover expenses (to a specified limit) incurred by employees who send their children before entering elementary school to nurseries. The Group has been televising in-house satellite programs and distributing the Childcare Support Guidebook, to raise workplace awareness and encourage more women to take advantage of the plan.

Examples of female employee support initiatives (as of July 2007)

Daiwa Securities Group's female employee and manager* ratios in Japan

* Deputy general manager or higher

   I balance my job in sales with caring for my two year-old son. My parents don't live close by, so when my son gets sick I have to take off work, but when I do, my coworkers help me to contact my customers. I also get a lot of cooperation from the people at work; for example, they remind me to go home early. That has allowed me to balance my job with raising a child. Pretty soon now, I'll be taking my second maternity leave. I have to admit that I'm a little worried about returning to work after my maternity leave, but I plan to continue working as long as possible.

   Our Human Rights Awareness Promotion Committee is chaired by the Daiwa Securities Group Inc. director in charge of personnel management. The committee provides training to directors and employees. It also strengthened the measures against sexual harassment in the Group, consequent to the enactment of the revised Equal Employment Opportunity Law in April 2007. Daiwa Group also manages employees' working hours. Daiwa Securities Group Inc. and Daiwa Securities Co. Ltd. encourage employees to leave by 7 p.m. Several programs have also been put in place to facilitate the taking of paid vacation, including "family days off" and "marriage preparation leave." As a result of these programs, employees take 35.6% of their paid vacation, which is an improvement from fiscal 2005.

Working hours and paid vacation usage rate (Daiwa Securities Group Inc., Daiwa Securities Co. Ltd., and Daiwa Securities SMBC Co. Ltd.)

* Figures represent the employees at the three companies who are members of the Daiwa Securities Group Employees' Union.

Employee welfare system usage (nine principal group companies*1)   (persons)

*1 Results of FY2004 and FY2005 covered only Daiwa Securities Group Inc., Daiwa Securities Co. Ltd., and Daiwa Securities SMBC Co. Ltd.
*2 Employees eligible for childcare leave include non-regular employees (contract workers, part-timers, etc.).

   In August 2006, Daiwa Securities Group Inc. created a new Mental Health Support Promotion Department in order to maintain the mental health of our employees. The office provides consultations via telephone, face-to-face meetings, and via its website. A certified clinical psychologist is also on call to provide counseling. In fiscal 2006, we focused on raising employee awareness. Because attentiveness by superiors ties into prevention and early detection, we repeatedly provided training to managers and supervisors in order to gain their understanding. Additionally, the body and mind are closely linked, so the Mental Health Support Promotion Department collaborates with the medical offices and outside specialists in order to provide rapid support to our employees.

   The Daiwa Securities Group believes that it is vital to get direct feedback from employees. Our Personnel Department communicates with employees through interviews, and a semi-annual self-assessment questionnaire. We also communicate frequently with members of the Employees' Union, and maintain good relations between labor and management, including utilizing the results of spring negotiations and union-member questionnaire conducted by the union twice each year in a variety of policies and initiatives.

Number of Employees' Union members (seven principal group companies*, as of the end of each fiscal year)   (persons)

* Daiwa Asset Management Co. Ltd., which has its own employees' union, and Daiwa Property Co. Ltd. which has no employee union, are excluded from the Group's principal companies.

   The Daiwa Securities Group actively hires experienced employees. In 2000, we introduced the Daiwa Elder System, which re-hires senior employees after they have reached mandatory retirement age. In April 2006, we introduced the Daiwa Master System in order to actively employ highly motivated and skilled people regardless of age, including compliance with the revised Law concerning Stabilization of Employment of Older Persons. Under this system, we continue to employ persons reaching retirement age and who meet certain criteria until the age of 65. We will continue to actively hire experienced employees.

Usage of the Daiwa Elder System and the Daiwa Master System (Daiwa Securities Group Inc., Daiwa Securities Co. Ltd. and Daiwa Securities SMBC Co. Ltd.)   (persons)