"Jeans for Genes Day" (a homonymous play on words) is a fundraising event that has been held since the 1990s in schools and companies in Europe and the United States to support children with genetic diseases. Since March 2021, Daiwa Securities Group has been holding Jeans for Genes Days on the third Friday of every month, with executives and employees coming to work wearing jeans to raise funds. Donations collected from Jeans for Genes Days held between October 2021 and February 2022 were sent to recipients of Support Term Deposits that provide pediatric care and support for people with disabilities. Daiwa Securities Group's social contribution activities conducted through Jeans for Genes Day and Support Term Deposits were featured in a TV program on Asahi Satellite Broadcasting called "Tsunagaru Ehon: for SDGs."

• "Tsunagaru Ehon: for SDGs," Asahi Satellite Broadcasting ⟨Japanese only⟩

Many small- and medium-sized companies and small-scale enterprises are now facing the issue of business succession due to the aging of their operators. However, it is said that about half the managers exceeding the age of 70—the average retirement age—in the next 10 years are yet to decide on their successors. Moreover, even the continuity of their business activities, which support regional economies, has recently been adversely affected by the unprecedented deterioration of management environment resulting from the COVID-19 pandemic. Daiwa Securities recognizes that it is its duty, as a financial institution, to firmly support, in financial terms, small- and medium-sized companies' efforts to pass down their valuable business resources, employment, and technologies to the next generations, thereby helping to maintain regional supply chains. We will support the sustainable development of local communities and the Japanese economy by encouraging the continuation, development, and growth of small- and medium-sized companies of good standing by providing solutions to inheritance, business succession, M&A, and other issues.

Daiwa Fund Wrap is a service enabling even those who are busy or have no investment experience to easily start medium- to long-term diversified investment. Under a discretionary investment contract, Daiwa Securities invests and manages assets on behalf of our customers. We offer plans that enable each customer to make diversified global investments according to their investment policy, as do professional institutional investors such as those managing public pension assets. It has become more important than ever for a large number of investors to manage their assets efficiently and stably through diversified global investment, in particular as a measure to address prolonged low interest rates, which have made it difficult to find attractive investment options. Daiwa Fund Wrap is a service offered to customers over the medium to long term. We provide thorough explanations before the conclusion of a contract, report investment performance regularly every three months, and hold follow-up seminars whenever necessary. We thus ensure close communication with customers and seek to build a relationship of trust with them.
Daiwa Fund Wrap Premium (Daiwa Fund Wrap with premium benefits) now offers a more detailed service, enabling customers to have multiple investment portfolios and design them in a highly customized manner. The beneficiary designation service and the gift service that takes advantage of the calendar year taxation system are incidental services that can meet the needs customers with a strong interest in inheritance tax measures.
Anshin Tsunagaru Wrap (Daiwa Fund Wrap with premium benefits that provide peace of mind) also offers incidental services that support all aspects of asset succession, such as inter vivos gifts (between living persons) and inheritance measures, in order to safeguard a customer's valuable assets and pass them on to their family.
Moreover, Daiwa Fund Wrap Online proposes the most suitable investment style from a minimum investment amount of ¥10,000 by utilizing Robo-Advisor technology. We thus provide a service enabling customers who prefer long-term asset management to easily engage in globally diversified investments online.
To keep attracting customers over the long term, we will continue our initiatives to implement better structures and systems so as to improve our performance and the quality of our services.

• Balance of domestic Wrap accounts: ¥13,722.2billion (As of March 31, 2022)

• * Source: Data released by the Japan Investment Advisers Association

• Balance of Wrap accounts at Daiwa Securities: ¥2,957.4 billion (As of March 31, 2022)

• *Source: Data released by the Japan Investment Advisers Association

• Daiwa Social Contribution Wrap - Daiwa Fund Wrap with a donation service
  Amount donated in FY2021: ¥43.61 million (FY2020: ¥3.58 million)

• *Total donated amount from customers and from Daiwa Securities
• *Donated to United Nations World Food Programme, Medecins Sans Frontieres Japan, WWF Japan, Japan Committee for UNICEF, Japan Platform

Daiwa Asset Management offers investment opportunities by creating and managing investment trusts with ESG and SDG targets.
The Carbon Neutral Equity Fund (Carbon Zero) was established by Daiwa Asset Management in July 2021 and is managed with advice from Candriam S.C.A. (Candriam). It is the first fund in Japan with a revolutionary scheme that aims for zero carbon not only in the investment part of the fund but also in other parts.
The fund invests in companies that provide solutions for realizing a decarbonized society. The fund’s portfolio comprises stocks from around the world, including Japan. Its portfolio was found to be even more effective than MSCI All Country World Index (MSCI ACWI) in terms of reducing carbon dioxide emissions. Furthermore, part of the fee earned by Candriam for advising the fund is used to invest in green projects aimed at reducing carbon dioxide emissions mainly in emerging economies such as India and Panama (i.e., projects that help address global warming and other environmental problems), thereby helping to offset the carbon dioxide emissions associated with the fund.

In addition, Daiwa Asset Management and some sales companies, including Daiwa Securities, are also contributing toward the restoration of natural environments by donating part of their trustee revenue from the fund to tree-planting activities through an NPO. In this way, investment beneficiaries are being provided not only with an opportunity to earn profits from investing in the fund, but also to help address environmental issues.
With respect to its donations to tree-planting activities, Daiwa Asset Management cooperated in an interview survey conducted by the National Land Afforestation Promotion Organization on the Project for Comprehensive Promotion of Forestation with Public Participation (a project commissioned by the Forestry Agency), which was reported to the Forestry Agency as an example of corporate involvement in forestation.
* The project report has not been made public.

In recognition of these initiatives of the Carbon Zero fund, Daiwa Asset Management won the Governor's Special Prize for Green Finance in the ESG Investment Category of the 2021 Tokyo Financial Award organized by the Tokyo Metropolitan Government and the Most Innovative Product Award at the 2022 Best of the Best Awards organized by Hong Kong's Asia Asset Management—The Journal of Investments and Pensions.

• Special feature on the Carbon Neutral Equity Fund (Carbon Zero) ⟨Japanese only⟩

Daiwa Office Investment Corporation (DOI), a REIT that specializes in office properties and is managed by Daiwa Real Estate Asset Management, established a green finance framework to provide ESG investment opportunities to investors. The company received a Green 1 (F) rating, the highest rating, from Japan Credit Rating Agency, Ltd. (JCR). In September 2020, DOI issued its first green bonds (five-year term: ¥1.5 billion; 10-year term: ¥2.4 billion).

Smartphones and other technical innovations are changing the common perception that securities companies are used only by affluent customers and that securities transactions require an advanced level of financial knowledge. We recognize that generating securities services available to all people in consideration of financial inclusion is an issue facing not only Daiwa Securities Group but also the securities industry as a whole.
Daiwa Connect Securities Co., Ltd. which began providing services in July 2020, is a new type of securities company created by Daiwa Securities Group. It chiefly handles transactions in units of one share and provides services mainly targeted at people in the digital native generation. The company provides and completes all services—from the opening of an account to securities trading—on smartphones, enabling anyone to use securities services, starting with a small amount of investment, as long as they have a smartphone.
Daiwa Connect Securities also provides an investment game app and a point investment service in collaboration with external companies, thereby offering opportunities to acquire financial knowledge easily even without funds and diversifying methods of access to financial services.
Daiwa Connect Securities will continue to develop and provide its services so that all people will be able to access better financial services.

Since FY2016, working-level personnel at Daiwa Securities Group, including from Daiwa Securities Group Inc., Daiwa Securities, Daiwa Institute of Research, and Daiwa Asset Management, have been conducting research activities on artificial intelligence (AI) and other state-of-the-art technologies across the Group.
Specifically, they have achieved results in research on the provision of a stock information service using a stock price prediction model, a real-time stock volume prediction model, shareholder rewards program Robo-Advisor, an AI-based business matching service, an AI-based company analysis tool, and other matters.

Moreover, in FY2017, the Group launched the "Daiwa Securities Group & the University of Tokyo Future Finance Forum" in order to develop its research activities further and expand the basis of the activities. As its advanced form, since FY2018 we have been conducting joint research with a University of Tokyo study group led by Professor Kiyoshi Izumi through a social cooperation program entitled "Next Generation Investment Technology" and have developed a theme issue search system based on associative retrieval.
Going forward, Daiwa Securities Group will continue to promote innovations in the financial industry through its ongoing research activities.

Since starting Daiwa Online Trade, Japan's first Internet-based securities brokerage service, in 1996, Daiwa Securities has provided various products and services successively over a period of more than 20 years. Due to the widespread use of portable information devices and the development of information communications technology, the importance of Internet channels has increased even more in recent years, with the number of accounts held under contract for Daiwa Online Trade topping 3.5 million as of the end of March 2022. Of Daiwa Securities' total stock transactions, approximately 85% are carried out via the online trading service, underscoring the fact that Daiwa Online Trade has become an indispensable channel for Daiwa Securities.
Since May 2017, we have been providing information through Daiwa Online Trade regarding domestic issues selected using an AI-based stock price prediction model developed by Daiwa Institute of Research, Daiwa Securities Group's think tank. We select issues whose prices are likely to go up gradually after the announcement of financial results, using a method of machine learning, which is an AI-related technology. In 2019, we distributed information four times in total when major financial results were announced.
Furthermore, in February 2019, we introduced a login function using a biometric authentication system to Kabu Walk, a smartphone application with a domestic stocks trading function provided on iPhones and Android devices. We believe that by actively using such new technologies, including AI and FinTech—an amalgamation of finance and information technology—we will stimulate interest in securities investment among individuals, especially younger generations, who have not previously been familiar with securities investment, and thereby support a shift from savings to asset building. In that way, we can contribute to Japan's sound economic development.
As the use of various AI-based services is currently spreading and the development of FinTech is accelerating, new financial services leveraging these technologies are becoming easily available. We will keep track of such trends and endeavor to continue enhancing convenience and providing quality services as a channel chosen by next-generation affluent customers and young customers with particular focus on inbound marketing.

Daiwa Online Trade

• Number of contract accounts: 3,506,000 accounts
  (As of the end of March 2022)

Due to its technological progress and higher academic rating, artificial intelligence (AI) has been increasingly used for business applications. Daiwa Institute of Research Business Innovation, which is entrusted by many financial institutions with system development, is advancing initiatives for research and application of AI.
As part of AI-based support for enhancement of financial services, the company developed a common data definition that enables AI to learn the financial activities and state of mind of retail customers with remarkable accuracy by combining a wealth of experience in developing financial systems and unique data science expertise. It built a financial product recommendation AI system based on this data definition, which has been provided since 2019 to some regional financial institutions. The system is expected to allow those financial institutions to predict the financial needs of their customers more accurately with AI.
Daiwa Securities Group will contribute to the social and economic development of communities through initiatives that actively use state-of-the-art technologies.

System Product WEB Service is offered as a support tool for customers building assets. Its aim is to realize a prosperous era of the 100-year life.
The service enables customers to centrally manage their stock-based employee benefit plans (such as stock ownership plans, workplace NISA, and defined contribution pension plans) and stock-based compensation plans (such as specified transfer-restricted stock (RS) and stock options) on a single online platform. The service enables us to support asset-building to help our customers realize their life plans and to actively encourage participation in a company's employee benefit plans, such as stock ownership plans and installment-type investment plans.
Utilizing the latest technologies in the context of digital transformation (DX), for companies and their employees, we are working to build highly flexible coordination based on an application programming interface (API), to provide a high degree of convenience, such as making use of cloud services to make opening accounts more effortless and less time-consuming, and to completely eliminate the need for paper and personal seals in various procedures.