The Investment Corporation is deeply committed to Environment, Social, and Governance (ESG) initiatives. To ensure the long-term sustainability of our business, we have established an ESG policy and put in place the necessary systems to implement it.

Addressing climate change and reducing the environmental footprint of our portfolio	・We aim to preserve the global environment by implementing effective measures to improve energy efficiency, conserve water resources, and reduce waste across our portfolio. ・Furthermore, we establish specific environmental targets—including GHG emissions, energy consumption, water usage, and waste—along with action plans to achieve these goals and reduce our overall environmental footprint.
Commitment to Employees	・We are committed to creating a supportive work environment and fostering employee development so that our employees can fully utilize their abilities. ・Additionally, we will conduct ongoing training and awareness programs for our employees to enhance their understanding of and ability to implement ESG initiatives.
Partnerships and Collaboration with External Stakeholders	・We strive to drive ESG initiatives by building strong partnerships and collaborating with various external stakeholders, including property managers, hotel operators, tenants, service providers, and local communities. Through these active engagements, we aim to create shared value and ensure sustainable operations.
Ensuring Compliance and Strengthening Governance Frameworks	・We will comply with ESG-related laws, regulations, and compliance requirements, and establish an appropriate organizational structure.
Transparent and Accessible ESG Disclosure	・We are committed to disclosing ESG-related information in a timely and appropriate manner, and to ensuring that such disclosures are easy to understand from the perspective of our unitholders.

Chief Sustainability Officer (President and CEO)	・The President and Representative Director of the Asset Management Company serves as the Chief Sustainability Officer (CSO), overseeing the establishment of the promotion structure and the formulation and execution of sustainability policies, targets, and action plans.
Sustainability Promotion Office	・As a general rule, regular meetings are held four times a year to formulate and implement goals and plans. ・Goals and plans proposed by the Secretariat are deliberated upon and formally determined by the Investment Committee. ・The status of these goals and plans is reported to the Investment Committee at least twice a year.
Members of the Sustainability Promotion Office	・The President and Representative Director（The Chief Sustainability Officer） ・Head of Asset Management Department（The Sustainability Officer） ・Chief Compliance Officer ・Head of Acquisitions Department ・Head of Corporate Management Department

We aim to reduce the environmental impact of our portfolio and enhance its environmental performance.

Initiatives for Enhancing Environmental Performance and Reducing Environmental Footprint

・Conclusion of Green Lease Memoranda: Signed on May 31, 2023, among Nippon Hotel & Residential Investment Corporation, APA Investment Advisors Co., Ltd., Oedo Onsen Monogatari Hotels & Resorts Co., Ltd., and Leoma Unity Co., Ltd. ・Collection of Environmental Performance Data ・Setting and implementation of targets to improve environmental performance ・Regular meetings of the Environmental and Energy Conservation Measures Council ・Implementation of measures such as converting common areas and guest rooms to LED lighting, and reducing tap water usage by reusing well water and reclaimed water ・Acquisition of environmental certifications

We strive to enhance the sustainability of the Investment Corporation and promote the formation of a sustainable society by building strong relationships and continuously collaborating with our external stakeholders. Through these partnerships, we aim to create long-term shared value for all parties involved.

Collaboration with Property Managers, Hotel Operators, and Tenants	・Sharing of ESG policies ・Holding regular meetings with operators ・Convening the Energy Conservation Measures Council
Contributing to Local Communities	・Participating in and sponsoring local events
Commitment to the Employees of the Asset Management Company	・Support for obtaining certifications to enhance professional skills; health initiatives; fair evaluations based on performance appraisal systems ・Holding Regular Environmental and Energy Conservation Councils
Initiatives for Investors and Lenders	・Providing various information through earnings briefings and our website ・Promoting understanding through direct communication with domestic and international investors and financial institutions
Signing of the 21st Century Principles of Financial Conduct	・In June 2023, we became a signatory to the Principles for Financial Action for the 21st Century (also known as the PFA21), an initiative promoted by the Ministry of the Environment to foster a sustainable society

We are committed to ensuring fair and highly transparent decision-making. To this end, we uphold the highest standards of ethical conduct, strict regulatory compliance, rigorous internal audits, and transparent reporting.

Decision-making process	・We have established decision-making processes designed to ensure strict compliance, fairness, and high transparency, and we conduct our operations in accordance with these procedures. For further details on our decision-making framework, please refer to the "Governance Structure" page on the Investment Corporation's website.
Sponsor’s Same-Boat Investment	・To ensure the alignment of interests with our unitholders, our sponsor, APA Holdings Co., Ltd., maintains an investment in a portion of the Investment Corporation’s units.
Customer-Oriented Business Conduct	・In accordance with the “Principles for Customer-Centric Business Operations” announced by the Financial Services Agency on March 30, 2017, we have established and announced seven “Basic Policies for Customer-Centric Business Operations” that serve as the foundation for our specific action plan.
Compliance Initiatives for Asset Management Company Employees	・We conduct regular compliance training for all employees of the Asset Management Company.
Regular Monitoring of Service Providers	・We conduct regular monitoring and evaluations of our service providers, covering such as operational quality, ESG initiatives, regulatory compliance, and information security management.