Daiwa Securities is promoting a wide range of initiatives to reduce environmental impact. Its head office is promoting paperless operations, reducing excess equipment and introducing eco-cars and hybrid vehicles, thereby substantially reducing its CO₂ emissions.

The head office of Daiwa Institute of Research endeavors to use environmentally friendly products, such as by introducing LED lighting and promoting green purchasing. In addition, Daiwa Institute of Research has reduced CO₂ emissions by switching power for use at its data centers to electricity originating from renewable energy power plants owned by Daiwa Energy & Infrastructure. It also worked to raise environmental awareness among employees, encouraged them to print fewer documents, and promoted telecommuting to reduce paper use.

Through these efforts, Daiwa Securities Group is striving to offer environmentally friendly services and reduce environmental load.

• Investment in energy-saving air conditioning systems and introduction of LED lighting for FY2022: ¥440 million
• Instances of soil and groundwater contamination at office sites in FY2022: Zero

In recent years, concerns have been raised about the risk of large-scale storm and flood damage in conjunction with the occurrence and increase of sea level rise, torrential rains, and super typhoons caused by abnormally high temperatures. The Group anticipates the possibility of physical damage to infrastructure, buildings, and so on at multiple sites as well as increased costs in conjunction with disaster countermeasures. Accordingly, in our business activities, we are continuing efforts to minimize the impact of such damage on operations by duplicating equipment and sites, moving equipment to upper stories of buildings, and so on. Moreover, in addition to higher operational costs for investment real estate, we anticipate declines in the value of assets under management and reductions in business. It is necessary that we review asset holdings and take measures such as ESG due diligence and fostering new industries and companies that contribute to the transition to a decarbonized economy. We will continue working to minimize the transitional risks associated with climate change.

• Refer also to "Response to Climate Change (Disclosure Based on the TCFD Recommendations 2023)."

Taking into account changes in various sustainability issues and the increasingly diverse needs of our stakeholders, Daiwa Real Estate Asset Management is promoting sustainability initiatives systematically such as by establishing Sustainability Promotion Office in June 2021 and formulating the Sustainability Policy in March 2023 in a way to upgrade sustainability-related policies described in the Policy Regarding ESG, with a view to addressing a variety of ESG related issues.

Listed REITs for which our company serves as an asset manager are actively working to acquire third-party environmental certifications, including CASBEE for Real Estate certification, DBJ Green Building Certification and BELS Certification, to enhance the reliability and objectivity of their efforts to reduce their environmental loads and increase the medium-to long-term value of their properties. Moreover, private REITs for which we are an asset manager are planning to obtain environmental certifications anew.

Environmental certification acquisition ratio for properties owned by Daiwa Office Investment Corporation (As of May 31, 2023)
Number of properties with environmental certifications: 32 properties; Environmental certification acquisition ratio (On the basis of total floor area of properties): 61.9%

Environmental certification acquisition ratio for properties owned by Daiwa Securities Living Investment Corporation (As of March 31, 2023)
Number of properties with environmental certifications: 21 properties; Environmental certification acquisition ratio (on the basis of total floor area of properties): 15.8%

Listed REITs for which our company serves as an asset manager have introduced or improved LED lighting, high-efficiency air-conditioners and water-saving facilities, and promoted greening in consideration of the preservation of biodiversity. The J-REITs are distributing sustainability guides to tenants and residents, and collaborate with these stakeholders to promote efforts to protect the environment and solve social issues. Daiwa Securities Living Investment Corporation is also promoting the installation of delivery boxes and the introduction of unattended delivery services for their properties, as the availability of these options will not only improve the convenience of tenants but also lead to reductions in CO₂ emissions associated with redelivery.

Delivery box installation ratio in rental residences owned by Daiwa Securities Living Investment Corporation (as of the end of March 2023)
Delivery box installation ratio (based on the number of buildings): Approx. 86%