Climate Change Data

Environmental Metrics

ESG Focus Areas

• Customer trust
• Compliance
• Corporate Governance
• Social Responsibility
• Environmental Sustainability

Environmental Achievements

• Reduced CO2 emissions to 40,708 tons in FY 2002 (from a higher level in FY 2001).
• Gradual decline in water usage since FY 2000 due to water-saving initiatives.
• Nearly 90% average paper recycling rate.
• Joined the Green Purchasing Network in June 2003.

Social Achievements

• Launched regional index funds to support regional economies.
• Established Mrs. Green eco fund in June 2001.
• Sponsored the Tokyo Conference of the Association for Sustainable & Responsible Investment in Asia (ASrIA) in October 2002.
• Increased average employment rate of persons with disabilities to 1.69% as of end of March 2003.
• Improved system to accommodate employees with small children, reducing overtime and improving health considerations.
• Provided 320 million yen for corporate citizen activities (about 1.1% of ordinary income).

Governance Achievements

• Established a new medium-term management plan (Best Brand Daiwa 2005).
• Implemented an internal reporting system (Corporate Ethics Hotline).
• Set up an Internal Audit Department.
• Increased the number of Outside Directors.
• Linked executive compensation to performance and introduced a “payment in shares of our stock system”.
• Established a Disclosure Policy to provide standards and methods for information disclosure.

Climate Goals & Targets

Environmental Challenges

• Incidents of deviation from the principles of brand management at Daiwa Securities SMBC and Daiwa Securities.
• Insufficient control over undisclosed corporate information leading to insider trading violations.
• Investment fraud by a contract employee.
• Embezzlement by a former Deputy General Manager.
• Low customer satisfaction in post-sales follow-up, quality of service, and sales staff advice.

Mitigation Strategies

• Established a Group-wide Corporate Ethics Hotline.
• Strengthened control over undisclosed corporate information.
• Substantially improved the customer interview system.
• Increased staff for branch office checking and advising in the Compliance Department.
• Implemented stricter control over information security.
• Systematized compliance training.
• Established an Internal Audit Department.
• Increased focus on post-sales follow-up as a central theme of branding activities.
• Transferred the Customer Satisfaction (CS) Promotion Department to the Marketing Division.

Supply Chain Management

Responsible Procurement

• Green purchasing initiatives; using Sanko Net to purchase certified products from the Green Purchasing Network (GPN).

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI

Certifications: ISO 9001 (Daiwa Securities Business Center)

Sustainable Products & Innovation

• Regional index funds
• Mrs. Green eco fund

Awards & Recognition

• Gómez Japan's first securities company IR site ranking (1st place)
• Daiwa Investor Relations Co., Ltd. Internet IR Best Company Award for 2003

Environmental Metrics

ESG Focus Areas

• Socially Responsible Investment (SRI)
• Economic and Financial Education
• Corporate Governance
• Compliance
• Customer Satisfaction
• Environmental Management

Environmental Achievements

• Reduced CO2 emissions by 3.9% from FY 2002
• Reduced electric power consumption by 4.16 million kWh since FY 2002
• Reduced water usage by 34,620,000 liters (7.3%) from FY 2002
• Reduced paper waste by 5.8% from FY 2002

Social Achievements

• Increased average employment rate of persons with disabilities to 1.9%
• Increased number of women in management positions
• Launched Student Company Program (SCP) in partnership with Junior Achievement Japan
• Offered economic and financial education programs to elementary, middle, and high school students
• Improved customer satisfaction scores

Governance Achievements

• Transitioned to a committee system to increase management transparency and mobility
• Established a Corporate Ethics Hotline
• Established a Disclosure Policy
• Increased internal detection of improper conduct in sales activity

Climate Goals & Targets

Environmental Challenges

• Growing gap between rich and poor
• Harm to the global environment
• Low awareness of SRI in Japan
• Need to improve employee understanding of CSR and brand
• Need to improve customer understanding of SRI
• Need to improve post-sales follow-up
• Need to reduce overtime hours and improve paid leave usage rate

Mitigation Strategies

• Promoting SRI through investment funds and educational initiatives
• Implementing systematic compliance training
• Improving internal control systems
• Strengthening communication with stakeholders
• Improving customer service systems
• Reviewing job content and appealing to department and branch managers

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Green purchasing initiatives through Sanko Net

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI

Certifications: Null

Third-party Assurance: Not disclosed

Sustainable Products & Innovation

• SRI funds (Daiwa SRI Fund, UBS Global Equity 40 SRI+, Global Eco Growth Fund)
• Kamakura Midori Sai (Kamakura Green Bonds)

Awards & Recognition

• 2003 NIKKEI Annual Report Awards (excellence award)
• No. 1 on the "CSR Report Rankings" by Nikkei Business Publications, Inc.

Environmental Metrics

ESG Focus Areas

• Sustainable Society
• Poverty Reduction
• Sound Financial and Capital Markets
• Work-life Balance
• Corporate Ethics and Compliance
• Economic and Financial Education

Social Achievements

• Developed and sold three Impact Investment bonds (approximately ¥65 billion total), contributing to the resolution of social issues.
• Launched Microfinance Bonds to help reduce poverty.
• Improved work-life balance initiatives, resulting in a 1.5-fold rise in paid leave usage rate and a decrease in average monthly overtime hours.
• Promoted four female employees to the executive team.
• Joined the UN Global Compact.

Governance Achievements

• Set a goal for all Daiwa Securities employees to gain specialist financial planner qualifications by the end of FY2010.
• Improved information disclosure and internal controls.
• Enhanced initiatives to avoid relationships with organized crime.

Climate Goals & Targets

Environmental Challenges

• Addressing global sustainability issues such as climate change and poverty.
• Developing sound financial and capital markets.
• Improving work-life balance for executives and employees.
• Maintaining high ethical standards and compliance.

Mitigation Strategies

• Developed and sold Impact Investment bonds.
• Implemented work-life balance measures (e.g., 7:00 p.m. office departure directive, paid leave encouragement).
• Provided training in corporate ethics and compliance.
• Increased economic and financial education initiatives.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI

Sustainable Products & Innovation

• Microfinance Bonds
• Vaccine Bonds

Environmental Metrics

ESG Focus Areas

• Socially Responsible Investment (SRI)
• Environmental Initiatives
• Work-Life Balance
• Human Rights
• Community Engagement

Environmental Achievements

• Reduced copy paper usage by approximately 23% from the previous fiscal year.
• Achieved a 9.1% reduction in paper use at Daiwa Securities Business Center, a cumulative 28% reduction since the program started.
• Increased paper waste recycling rate by 3.0% year on year.

Social Achievements

• Increased the share of individual investors by 1.47 points to 23.53%.
• Launched a donation program for the Great East Japan Earthquake using points from the Daiwa Point Program.
• Implemented various work-life balance initiatives, including childcare leave, nursing care leave, and shorter workday programs.
• Increased the number of women in management positions.
• Increased the number of employees taking childcare leave and nursing care leave.
• Consistently included in the Dow Jones Sustainability World Index and FTSE4Good Index.

Governance Achievements

• Established the Group Risk Management Department and appointed a Chief Risk Officer.
• Developed a business continuity plan (BCP).
• Implemented a sophisticated information security management system.
• Upgraded internal administration supervisory system by ensuring that every branch has a full-time position dedicated to this function.
• Strengthened compliance framework and internal controls.
• Established a Corporate Ethics Hotline.

Climate Goals & Targets

Environmental Challenges

• Increased energy consumption at domestic offices due to revised Act on the Rational Use of Energy.
• Small percentage of overall investing in Japan using SRI concepts compared to US and Europe.
• Need to improve awareness of social responsibilities in emerging economies and developing countries among employees.

Mitigation Strategies

• Implementing initiatives to reduce energy consumption and track data on CO2 emissions, paper usage, waste generated, and recycling amounts.
• Developing indicators for assessing the extent to which SRI concepts are being realized in mainstream business.
• Developing a system that involves all employees in addressing social responsibilities in emerging economies and developing countries.
• Encouraging employee volunteer activities to enhance CSR capacity.

Supply Chain Management

Responsible Procurement

• Green Procurement Network (GPN) compatible products

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI G3.1

Certifications: ISO 14001 (Daiwa Institute of Research Business Innovation)

Sustainable Products & Innovation

• Impact investment products (e.g., Vaccine Bonds, Water Bonds, Microfinance bonds)

Awards & Recognition

• Ministry of Health, Labor and Welfare Award
• Nikkei Childcare Support Award
• Third Diversity Management Prize

Environmental Metrics

ESG Focus Areas

• Corporate Governance
• Compliance
• Human Rights
• Risk Management
• Environmental Initiatives
• Relationship with Shareholders and Other Investors
• Relationship with Employees
• Engagement with Society

Environmental Achievements

• Reduced CO2 emissions by approximately 9.1% in FY2015 compared with FY2014
• Increased the proportion of customers choosing online reports (reducing paper consumption) to 38.7% as of the end of March 2016 (up 1.8% from the previous year)
• Replaced company cars with more fuel-efficient eco-cars and hybrid vehicles, reducing CO2 emissions equivalent to the absorption of more than 40,000 Japanese cedar trees annually

Social Achievements

• Implemented a dementia supporter training program at all branches, resulting in approximately 2,400 dementia supporters by March 31, 2016
• Increased the number of women in management positions to 316 (7.5% of total managers) as of March 31, 2016
• Launched Daiwa Social Contribution Wrap—Daiwa Fund Wrap with a donation service
• Expanded training programs for employees aged 45 and older and introduced a License Certification System
• Supported employees in child-rearing and nursing care exceeding statutory requirements
• Introduced a Childrearing Support Leave system to encourage male employees to take leave

Governance Achievements

• Clearly separated supervisory and executive functions of management
• Adopted a Three Committees System with a majority of outside directors in the committees
• Established a risk appetite framework approved by the Board of Directors
• Implemented a whistle-blowing system (Corporate Ethics Hotline) receiving 42 reports in 2015
• Strengthened compliance system with approximately 250 staff dedicated to compliance

Climate Goals & Targets

Environmental Challenges

• Securing appropriate profits for shareholders while meeting the expectations of other stakeholders amid changes in business models due to technological advancements
• Managing risks associated with the securities business, including market risk, credit risk, liquidity risk, and operational risk
• Addressing the increasing severity and sophistication of cyberattacks
• Balancing the costs of CSR activities with their effectiveness and value for shareholders

Mitigation Strategies

• Introduced environmental accounting to track costs and effects of environmental preservation
• Established a risk appetite framework and comprehensive risk management structure
• Implemented a multi-layered defense system against cyberattacks
• Analyzing the cost-effectiveness of CSR activities and working on reducing their costs

Supply Chain Management

Responsible Procurement

• Regular checks of documents disclosed by major business partners

Climate-Related Risks & Opportunities

Physical Risks

• Large-scale flood damage due to rising sea levels and typhoons

Reporting Standards

Frameworks Used: GRI G4 Sustainability Reporting Guidelines, SASB (provisional sustainability accounting for the financial sector), ISO 26000

Sustainable Products & Innovation

• Impact Investment bonds (Green Notes, Water Bonds, Inclusive Business Bonds)
• SRI investment trusts
• Daiwa Fund Wrap

Awards & Recognition

• Dow Jones Sustainability Asia Pacific Index (7 consecutive years)
• FTSE4 Good Index (11 consecutive periods)
• Nadeshiko Brand (2 consecutive years)
• Health & Productivity Stock Selection (2 consecutive years)
• Platinum Kurumin (Certified Family-Friendly Employer)
• Tomonin (Logo for Promoting the Provision of Working Environment Favorable for Balancing Work with Long-Term Care)
• GRESB 2015 Green Star

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Corporate Governance
• Human Rights
• Community Investment
• Financial Inclusion

Environmental Achievements

• Reduced CO2 emissions by approximately 6.0% for Daiwa Securities Group’s domestic offices in FY2018 (compared to FY2017).
• Replaced 14 multifunction copiers at the head office in FY2018, reducing power usage by approximately 35%.
• Successively replaced company cars with eco-cars and hybrid vehicles since FY2014, reducing CO2 emissions by an amount equivalent to the CO2 absorption of more than 40,000 Japanese cedar trees annually.
• Introduced LED lighting into the head office of Daiwa Institute of Research in summer 2017.
• Reduced paper consumption by 3.4% year on year in FY2018.

Social Achievements

• Launched Anshin (peace of mind) Planners and Financial Consultants to provide optimum consulting and solutions to customers.
• Introduced NPS® (Net Promoter Score) to measure customer satisfaction.
• Improved in-branch customer service quality, including placing dementia supporters and service assistants at all branches.
• Implemented barrier-free measures at sales branches to enhance accessibility for elderly and disabled customers.
• Launched the Women Supporter Fund (Tsubaki) and the Social Challenges Fund (Egao-no-kakehashi).
• Increased the number of briefings for individual investors.
• Held live web seminars and Nico Nico Live programs to communicate market information.
• Established Fintertech Co. Ltd. to provide next-generation financial services.
• Established Daiwa Energy & Infrastructure Co. Ltd. to promote investment and financing for energy.
• Established Daiwa ACA Business Succession Fund to support small and medium-sized companies.
• Established Daiwa Food & Agriculture Co. Ltd. to promote industrialization of agriculture.
• Made ACA HealthCare Inc. (renamed Daiwa ACA HealthCare) a subsidiary to expand into the healthcare field.
• Made ORIX Living Corporation (now Good Time Living Co. Ltd.) a subsidiary to provide high-quality nursing care services.
• Supported the “New Tohoku” Restoration Business Contest.
• Participated in “Sido Next Innovator 2018” to develop human resources for next-generation innovation.

Governance Achievements

• Clearly separated supervisory and executive functions of management.
• Adopted a company with Three Committees system to improve decision-making, enhance transparency, and exert management oversight.
• Appointed four female directors and corporate executive officers.
• Implemented a multifaceted evaluation system for managers.
• Introduced a whistleblowing system (Corporate Ethics Hotline).
• Implemented a compliance program focusing on market fairness, anti-social forces, and information security.
• Implemented a customer inspection system to eradicate anti-social forces.
• Expressed support for the TCFD recommendations.

Climate Goals & Targets

Environmental Challenges

• Climate change risks and opportunities.
• Supply chain disruptions.
• Maintaining market functions.
• Cybersecurity threats.
• Business succession challenges for SMEs.
• Aging population and healthcare demands.
• Child poverty.

Mitigation Strategies

• Developed a risk appetite framework.
• Implemented a business continuity plan (BCP).
• Engaged in due diligence for underwritten deals and self-investment deals.
• Strengthened IT governance and cybersecurity management.
• Established Daiwa ACA Business Succession Fund.
• Expanded into the healthcare field through acquisitions and investments.
• Established “Daiwa Securities Group Child Support Fund for a Bright Future”.

Supply Chain Management

Supplier Audits: Regular checks of documents disclosed by major business partners, including providers of IT equipment and services.

Responsible Procurement

• Regular checks of documents disclosed by major business partners, including providers of IT equipment and services.
• Urging business partners to make improvements when issues are found.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Decrease in business from companies significantly affected by the transition to a lower-carbon economy.
• Increase in reputational risk associated with investment in businesses with a heavy environmental load.
• Decrease in assets under management resulting from a decline in the value of assets held by funds.

Opportunities

• Increase in demand for funds to prepare for a lower-carbon society.
• Increase in deals underwritten in association with financing for renewable energy.
• Increase in opportunities for investing in new industries contributing to the transition to a lower-carbon society.
• Increase in business opportunities for providing solutions to assist in the transition to a lower-carbon society.
• Improved evaluations from stakeholders.

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Standards 2016, SASB, TCFD, UNGC

Certifications: ISO 14001, ISO 27001, ISO 27017, ISO 20000

Third-party Assurance: Independent Assurance

UN Sustainable Development Goals

• Goal 1 (No Poverty)
• Goal 3 (Good Health and Well-being)
• Goal 4 (Quality Education)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 13 (Climate Action)

The report details how various initiatives contribute to these SDGs.

Sustainable Products & Innovation

• Green bonds
• SDG-related funds
• Impact investment products

Awards & Recognition

• Lead Manager of the Year - Social Bonds (Environmental Finance Magazine)
• Best ESG Bond House (EMEA Finance magazine)
• Nadeshiko Brand
• Health & Productivity Stock Selection
• Competitive IT Strategy Company

Environmental Metrics

ESG Focus Areas

• Economic
• Environmental
• Social
• Governance

Environmental Achievements

• Increased renewable energy share to 21.1% of total energy use in FY2021 from 3.1% in FY2020
• Reduced greenhouse gas emissions (Scope 1+2+3) to 23,065 t-CO2 in FY2021 from 36,626 t-CO2 in FY2019
• Improved waste recycling rate to 74% in FY2021 from 68.9% in FY2019

Social Achievements

• Increased percentage of female managers to 15.1% in FY2021 from 11.9% in FY2019
• Increased number of employees taking childcare leave
• Implemented various work-life balance initiatives, including childcare leave, nursing care leave, and short working hours system
• Expanded leave system to include marriage preparation vacation, kids’ ceremony vacation, family day vacation, parents’ longevity vacation, and volunteer vacation

Governance Achievements

• Increased percentage of female directors to 28.6% by June 2022
• 100% attendance rate at Board of Directors meetings by Outside Directors in FY2021
• Number of reports received through whistleblowing system remained relatively stable

Climate Goals & Targets

Environmental Challenges

• Reducing greenhouse gas emissions across the entire value chain
• Further increasing female representation in management
• Maintaining a balance between work and personal life for employees

Mitigation Strategies

• Investment in energy-saving air conditioning systems
• Implementation of various work-life balance initiatives
• Promoting diversity and inclusion programs

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: SASB

Third-party Assurance: Independent Assurance

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Increased renewable energy share to 32.5% in 2022 from 1.6% in 2019 (Japan + Overseas)

Social Achievements

• Increased percentage of women in management positions to 16.9% in 2022 (Consolidated)
• Increased paid vacation usage rate to 74.8% in 2022 (Two group companies)
• Number of employees taking childcare leave: 965 in 2022 (Consolidated)

Governance Achievements

• 50% of board members are outside directors in 2023
• 35.7% of board members are women in 2023

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Third-party assurance provided for marked indicators (excluding Japanese descriptions).

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Diversity & Inclusion
• Climate Change
• Sustainability

Environmental Achievements

• Introduced renewable energy at headquarters building in FY2021
• Estimated emission volume of investment and loan portfolio in FY2023 and established target value for project finance in the power generation sector

Social Achievements

• Increased percentage of women in management positions in Japan from 2.2% (end of FY2004) to 18.4% (end of March 2024)
• Increased percentage of women in management positions at Daiwa Securities Co., Ltd. from 2.3% (end of FY2004) to 21.1% (end of March 2024)
• Launched “For Your Dream –Children’s Smile Project” in 2017 to support children in financially difficult situations

Governance Achievements

• Adopted Three Committees System (nominating, audit, and compensation committees) with independent outside directors in the majority
• Established the Diversity & Inclusion Committee in FY2022
• Regularly conducts effectiveness evaluations of the Board of Directors

Climate Goals & Targets

Environmental Challenges

• Climate change and geopolitical risks
• False reports and misinformation created by AI

Mitigation Strategies

• Revised scope and definitions of top risks
• Created AI Governance Mission Statement and established the AI Governance Committee
• Improved cybersecurity control and management framework
• Held discussions on sustainability, including setting interim targets for GHG emissions

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD

Awards & Recognition

• Awards to Commend Leading Companies Where Women Shine
• Minister of State for Gender Equality Commendation
• Minister’s Prize for Equal Employment/Work and Family Harmonization, Excellence Award (Family-friendly Enterprises Category)
• Nadeshiko Brand

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced CO2 emissions (Specific figures available in the report but not easily extractable in a quantified manner)
• Investment in energy-saving air conditioning systems

Social Achievements

• Launched Daiwa Social Contribution Wrap — Daiwa Fund Wrap with a donation service
• Implemented SDGs/ESG seminars
• Various initiatives for work-life balance (childcare leave, nursing care leave, short working hours system, etc.)
• High return to work rate for those taking childcare leave

Governance Achievements

• Established a whistleblowing system
• Regular meetings of Nominating, Audit, and Compensation Committees

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: SASB

Certifications: Null

Third-party Assurance: Independent Assurance

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed