Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Governance

Environmental Achievements

• Received a “2 Stars” GRESB Rating and a “Green Star” designation for the second year in a row in the October 2022 GRESB Real Estate Assessment.

Governance Achievements

• Asset Manager paid 666 million yen in full compensation for damages caused by breach of fiduciary duty of loyalty.
• Implemented various measures to strengthen legal compliance and internal control systems, including the adoption of the Declaration of Compliance, establishment of a management philosophy, changes to the operational flow, acceptance of the dispatch of directors from Chubu Electric Power, changes to the rules for ordering real estate appraisals, revision of various rules and manuals, strengthening the monitoring of the real estate appraisal order process by the Compliance Department, and the implementation of various training programs and proficiency tests.

Climate Goals & Targets

Environmental Challenges

• Asset Manager received Business Suspension Order and Business Improvement Order from the Financial Services Agency on July 15, 2022.
• Concerns about the Bank of Japan's increased tolerance for fluctuations in long-term interest rates and changes in interest rate policy.

Mitigation Strategies

• Asset Manager submitted a report to the Commissioner of the Financial Services Agency on August 15, 2022, summarizing the status of its business improvement measures.
• Asset Manager reviewed its business management methods to establish a responsible legal compliance and internal control systems.
• ESCON REIT received full compensation from the Asset Manager for damages incurred (666 million yen).

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRESB

Third-party Assurance: BDO Sanyu & Co.

Awards & Recognition

• “2 Stars” GRESB Rating
• “Green Star” designation

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Introduced a groundwater membrane filtration system in Asumigaoka Brand-New Mall, reducing environmental burden.
• Introduced LED lighting systems in communal areas of several properties, reducing electricity consumption.

Social Achievements

• Held various events in lifestyle-focused commercial facilities, promoting community engagement.
• Introduced breastfeeding rooms and resting rooms for tenant employees in several facilities.
• Certified tonarie Seiwadai as a dementia-friendly shopping center.
• Participated in the “Child-raising Support Passport Project”.

Governance Achievements

• Lifting of Business Improvement Order by the FSA.
• Transitioned to a company with an Audit and Supervisory Committee.
• Plans to appoint an executive director and supervisory directors not affiliated with the ESCON JAPAN Group to strengthen conflict of interest management.

Climate Goals & Targets

Environmental Challenges

• Water leakage accident at tonarie Seiwadai resulting in revenue loss and increased costs.
• Temporary expenses related to the water leakage accident, general meeting of unitholders, and refinancing.

Mitigation Strategies

• Implemented cost reduction measures, including reduced utility charges and repair expenses.
• Actively pursuing tenant replacement to increase rent revenue.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRESB

Certifications: DBJ Green Building

Awards & Recognition

• 2 Stars in GRESB Rating
• Green Star designation in GRESB Real Estate Assessment

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Introduced a groundwater membrane filtration system in Asumigaoka Brand-New Mall, contributing to reduced environmental burden.
• Installed LED lighting in communal areas of several properties to reduce electricity consumption.
• Achieved a “1 Stars” GRESB Rating and a “Green Star” designation in the 2023 GRESB Real Estate Assessment.
• Obtained DBJ Green Building Certifications for five properties.

Social Achievements

• Held various events in lifestyle-focused commercial facilities to contribute to local community revitalization.
• tonarie Seiwadai certified as a dementia-friendly shopping center.
• Held a dementia awareness event at tonarie Minami-senri.
• Improved workplace environment for employees through leave system enhancements and facilities renewal (breastfeeding rooms, resting rooms).

Governance Achievements

• Transitioned to an Audit and Supervisory Committee system.
• Appointed an executive director from outside the ES-CON Group to strengthen conflict of interest management.

Climate Goals & Targets

Environmental Challenges

• High utility charges at Asumigaoka Brand-New Mall exceeding utility income.
• Need to reduce greenhouse gas emissions, considering that 91.4% of annual emissions come from tenants.

Mitigation Strategies

• Investigated energy usage at Asumigaoka Brand-New Mall and received proposals for improvement measures.
• Considering proposals for solar panel installation.
• Promoting the introduction of green lease clauses in lease agreements with tenants (45 agreements concluded as of Jan 31, 2024).

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRESB

Certifications: DBJ Green Building

Awards & Recognition

• GRESB Green Star