Materiality and KPIs

Materiality and KPIs

Materiality

Through the meetings of the Sustainability Committee, the asset manager has examined its vision and targets for sustainability and carried out efforts toward their realization. As the level of interest toward sustainability is rising, the Company has further clarified the responses to be taken by identifying and visualizing related to sustainability materiality through dialogue with global stakeholders and collaborative efforts with other organizations. These issues were identified based on the Company’s Corporate Philosophy and Sustainability Policy.

Materiality

List of Sustainability Issues

  • Response to sustainability certifications
  • Building resilience
  • Response to climate change
  • Energy efficiency
  • Ensuring of health and well-being of and convenience for people (tenants)
  • Employee cultivation and level of satisfaction
  • Efficient water use
  • Waste disposal
  • Partnership with stakeholders
  • Biodiversity in areas surrounding our buildings
  • Human rights
  • Diversity, equity, and inclusion
  • Compliance
  • Supply chain management

Materiality and KPIs

Level of Importance ★★★

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Materiality Target KPI Progress in FY2024 Risk Opportunity Related SDGs
Response to sustainability certifications Improve sustainability activities through participation in external evaluation organizations such as GRESB GRESB: Acquiring five Star Acquired five stars Decline in assessment among tenants and investors who base their assessments on sustainability
  • Improve environmental performance of properties
  • Expand the range of investors
 [9] INDUSTRY, INNOVATION, AND INFRASTRUCTURE
[11] SUSTAINABLE CITIES AND COMMUNITIES
CDP: Acquiring more than “A- (Leadership)” Acquired A (Leadership)
Improving proportion of environmental certifications Acquiring certifications for 75% or more of the total portfolio (Total floor area basis) Percentage of properties with environmental certifications as of December, 2024: 78.3%
Response to climate change Reduction in GHG emission Reduce total emissions by 42% compared to 2020
Target: Scope 1&2
(Target year: 2030)		 FY2023: △35.6% (compared to 2020)
Annual rate: △11.9%
Renewable energy ratio in FY2023: 15.7%
  • Drop in tenant sales & increase in property damages due to physical impact of climate change
  • Decline in assessment by tenants & investors
 Cost reduction with efficient energy use [13] CLIMATE ACTION
Energy efficiency Introduction of renewable energy Renewable energy ratio of electricity used in business activities to 50%
(Target year: 2030)
  • Increase in energy-related expenses
  • Reinforcement of environmental regulations
 Cost reduction with efficient energy use [7] AFFORDABLE AND CLEAN ENERGY
Building resilience Implementing disaster prevention measures
  • Preparing emergency supplies at 100% of the properties where such supplies can be kept
  • Developing an emergency communication network that covers 100% of properties
  • Collecting engineering reports (ERs) regularly for 100% of properties
  • Preparing emergency supplies: 100%
  • Developing an emergency communication network: 100%
  • Collecting regular engineering reports: 100%
 Increase in expenses for recovery, compensation, etc., after natural disasters Increase in property competitiveness [9] INDUSTRY, INNOVATION, AND INFRASTRUCTURE
[11] SUSTAINABLE CITIES AND COMMUNITIES
Ensuring of health and well-being of and convenience for people (tenants) Improvement in tenant employee space Improving communication space and refresh space at the time of renewal
  • Installed digital signage to raise awareness about wellness
  • Renovated employee restrooms
  • Decline in property competitiveness
  • Manpower outflow due to declining work conditions
  • Improved sustainability assessment by assessment bodies and investors
  • Improvement in employee satisfaction and tenant assessment & satisfaction
 [3] GOOD HEALTH AND WELL-BEING
Visualization of health and comfort Considering acquisition of wellness certification
KJRM Implementation of employee satisfaction survey Survey conducted annually Implemented
  • Target: all employees
  • Response rate: 100%
Diversity, Equity, and Inclusion KJRM Development of working environments where employees can fulfill their potential and achieve a work-life balance Achievement of a 50% utilization rate of parental leave by male employees (at least one employee taking parental leave) 33.4% as of December 31, 2024 Outflow of talent
  • Achievement of work-life balance and support for continued employment
  • Recruitment of talent
 [5] GENDER EQUALITY
[8] DECENT WORK AND ECONOMIC GROWTH
KJRM Further promotion of women’s active participation in the workplace to continue fostering groundbreaking innovation Raise the percentage of female employees in management roles to 20% (target year: 2027) 13.2% as of December 31, 2024
Employee cultivation KJRM Employee participation in compliance training 100%
Training conducted annually		 Participation rate: 100%
  • Outflow of talent
  • Emergence of risks with decline in compliance awareness
  • Development & recruitment of competitive human resources
  • Assurance of customer trust through improved compliance awareness
 [8] DECENT WORK AND ECONOMIC GROWTH

Level of Importance ★★

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Materiality Target KPI Risk Opportunity Related SDGs
Biodiversity Obtain certification for biodiversity Consider the acquisition of certification for biodiversity Decline in assessment among tenants and investors who base their assessments on sustainability
  • Expand the range of investors
  • Improvement of sustainability evaluation by contributing to conservation goals
 [14] LIFE BELOW WATER
[15] LIFE ON LAND

Level of Importance ★

This table can be scrolled sideways.

Materiality Target KPI Risk Opportunity Related SDGs
Waste Increased recycling rate Increase recycling rate while maintaining waste grasp rate
  • Reputation risk caused by increase in wastes
  • Increase in processing cost
 Reduce processing costs by increasing recycling rate [12] RESPONSIBLE CONSUMPTION AND PRODUCTION
Water Reduction in water consumption Implementation of reducing water consumption
  • Impact of shortage or quality decline of water resources on surrounding areas
  • Rise in cost with increase in water consumption volume
 Cost reduction with reduction in water consumption [6] CLEAN WATER AND SANITATION
Partnership with tenants Introduction of green lease Continue to propose introduction of green leases to tenants
  • Greater tenant burden regarding safety and the environment
  • Decline in tenant satisfaction
  • Devolution into property attractive to the tenant
  • Generation of stable revenues
 [12] RESPONSIBLE CONSUMPTION AND PRODUCTION
[17] PARTNERSHIPS FOR THE GOALS
Execution of tenant satisfaction survey Conducting tenant satisfaction surveys at 100% of directly managed properties
Promoting environmental consideration to tenants Continue to propose interior design standards for tenants (environmental considerations)
Collaboration with local communities Support for social welfare organizations Cooperating for UNICEF fundraising and campaign for United Nations Refugee Support Activities
  • Degradation of the environment surrounding the property
  • Decline in reputation in the neighboring area
  • Revitalization of neighboring areas
  • Improvement of corporate image
 [17] PARTNERSHIPS FOR THE GOALS
Providing land to community events Conducting programs that contribute to communities at 100% of directly managed properties where events can be conducted
  • *Calculated based on the total floor space (after considerations for occupancy rate)
DFF Inc., Japan Metropolitan Fund Investment Corporatio, Mitsubishi Corp. - UBS Realty Inc.