The contents of the "Sustainability Report 2021," which summarizes the ESG initiatives of Japan Logistics Fund, Inc. and Mitsui & Co.
The report is available in PDF format.
In addition, "ESG Initiatives" in the Sustainability Report and JLF website refer to the GRI Standards. The following table shows where the relevant information is posted.
Mitsui & Co., Logistics Partners Ltd., an asset manager of JLF has established "Guidelines for ESG Initiatives".
1. Basic Stance
Mitsui & Co., Logistics Partners Ltd. (hereinafter referred to as the “Asset Manager”), as the asset manager for Japan Logistics Fund, Inc., recognizes the importance of environmental, social and governance (ESG) aspects in real estate investment management business.
As its initiatives for environment and society, the Asset Manager shall consider reducing the environmental burden and building trust with various stakeholders in and outside the company, and aims at realizing a sustainable society and contributing to society through the conduct of investment management operations. Moreover, in its corporate governance initiatives, the Asset Manager shall ensure legal compliance, establish risk management systems and strive for timely and appropriate information disclosure to investors and other relevant persons.
The Asset Manager has established a “Sustainability Policy” (hereinafter sometimes referred to as the “Policy”) and shall promote ESG initiatives which shall be led by “Sustainability Promotion Liaison Meeting.” Furthermore, to advance its ESG initiatives, the Asset Manager shall identify and set sustainability targets for important matters related to ESG (materialities) and build and manage an Environmental Management System (EMS).
2. Sustainability Policy
The Asset Manager has established a “Sustainability Policy,” as described below, with an eye to conducting a real estate investment management business that considers the reduction of the environmental burden, safety and security and the improvement of comfort, as well as a variety of different types of coordination and cooperation with various stakeholders.
I. Contribute to sustainable environment
To achieve the social responsibility of improving environmental performance of the managed properties, we shall contribute to environmental sustainability by continuously reducing the environmental impact of the managed properties and mitigating environmental burden.
(i) Improve efficiency in energy use and respond to climate change
We shall promote efficient use of energy in real estate investment management and work to reduce carbon emissions by means such as the introduction of technology and facilities that contribute to energy saving and creation and switchover to electricity with lower carbon dioxide emission factor. In addition, it shall strive to respond to climate change through carbon offsetting and so forth.
(ii) Preserve water environment
We shall work to preserve water environment by conserving water and introducing water-saving equipment, among other measures.
(iii) Promote resource saving and waste disposal reduction
We shall work to implement initiatives for resource saving and waste disposal reduction through the three Rs (reduce, reuse and recycle).
(iv) Consider biodiversity
Through landscape management and so forth that give consideration to biodiversity, we strive to coexist with the natural environment and contribute to building a society in harmony with nature.
(v) Consider environmental attributes of building materials
In executing repair work and add-value renovations of properties, we shall consider using environmentally friendly building materials.
II. Create a pleasant and healthy work environment and endeavor to educate officers and employees
In accordance with the Act on Investment Trusts and Investment Corporations, investment corporations may not hire employees. Their investment management operations are performed practically by officers and employees of asset managers. Recognizing that human resources are its greatest assets, the Asset Manager shall work to create a healthy and pleasant work environment where each officer and employee can maximize his/her potential and shall implement initiatives for human resources development, including the provision of support for professional education and training and the establishment of an evaluation and feedback system.
In the implementation of this Policy, the Asset Manager shall also endeavor to improve social and environmental awareness among its officers and employees by continuously conducting educational and familiarization activities.
III. Cooperate and coordinate multimodally with a wide range of stakeholders
The Asset Manager shall stress dialogues with tenants, property managers and other business partners, as well as local communities and other external stakeholders, work to build trust relationships with them and strive to promote ESG initiatives.
The Asset Manager shall consider health, safety and comfort of the tenants occupying the properties, practice disaster prevention drills based on public and private partnerships and promote initiatives based on a business continuity plan (BCP).
IV. Ensure legal compliance and establish corporate governance and risk management systems
(i) Ensure legal compliance
Recognizing legal compliance as one of the most important management initiatives, Directors of the Asset Manager shall lead efforts to promote legal compliance in the execution of business operations and ensure that officers and employees are fully aware of the importance of legal compliance. In addition, all officers and employees shall not only comply with laws, regulations and rules but endeavor to uphold high moral values and to sincerely and appropriately carry out their duties.
(ii) Establish corporate governance and risk management systems
The Asset Manager has established internal systems for the development of regulations, rules, procedures and manuals to be observed in its business conduct and the enhancement of corporate governance, in its effort to improve transparency in decision-making and avoiding conflicts of interest and to manage and mitigate various risks associated with the execution of business operations.
V. Disclose information to investors and other relevant persons and utilize environmental certifications and evaluations
The Asset Manager shall strive to proactively disclose information pertaining to the Policy and the status of implementation of initiatives based on the Policy to investors and other relevant persons. In addition, it shall explore the utilization of environmental certifications and evaluations in order to materialize the outcome of initiatives based on the Policy.
VI. Review the Policy
To ensure the effectiveness of the Policy, the Asset Manager shall review the Policy, considering social situations, changes in people’s awareness, advances in technology and other circumstances.
3. Sustainability Promotion Structure
I. Sustainability Promotion Liaison Meeting
Sustainability Promotion Liaison Meeting shall pursue ESG initiatives in accordance with the Sustainability Policy.
Sustainability Promotion Liaison Meeting is attended by the President, General Manager of each department and others, and General Manager of Corporate Planning and Finance Department manages Sustainability Goals. Regular meetings are held once every three months, in general, to review the Sustainability Policy and Goals and various initiatives pertaining to sustainability considering social situations and the status of investment by the Investment Corporation.
II. Important ESG matters (materialities)
The REIT and the Asset Manager shall select from among various ESG issues, those ESG issues that a REIT should address and identify important ESG matters (materialities) that the REIT should tackle. For each materiality, KPIs (action plans and targets) shall be set and managed so as to drive ESG activities deeper.
① Important ESG matters (materialities) identification process
② Responding to SDGs
To further promote management with a focus on ESG, the REIT and the Asset Manager shall identify important matters (materialities) that should be prioritized and clarify targets for strongly related SDGs.
③ Important ESG matters (materialities) for Japan Logistics Fund, Inc. and Mitsui & Co., Logistics Partners Ltd.
|E||Response to climate change||Manage and reduce energy consumption and CO2 emissions||Endeavor to reduce CO2 emissions by introducing technologies and facilities that use energy efficiently, conserve energy or generate energy and switching to power sources with low emissions coefficients, among other things.||Reduce legally compliant energy consumption basic unit and greenhouse gas emissions basic unit by an annual average of 1% or more. Distribute informational posters and pamphlets and implement ESG study groups (covering 75% or more of tenants per year).|
|Environmental Compliance||Continue to work to acquire green certifications, such as Green Building Certifications||
Acquire green certifications in 40% of portfolio in FY 2021.
Acquire green certifications in 50% of portfolio in FY 2025.
Acquire green certifications in 70% of portfolio in FY 2030.
|Collaboration with tenants to be environmentally friendly||Promote the introduction of green leases from the perspective of both operations and facility improvements to contribute to the environment through collaboration with tenants.||
Implement green leases in 25% of portfolio.
Exchange opinions with tenants on ESG.
|Implement strategies to increase resilience against intensifying natural disasters to lower the risk of damages to portfolio profitability caused by disasters.||Organize broad schemes related to business continuity.|
|Support a recycling economy||Strive to preserve the water environment by conserving water, introducing water-saving equipment and the like.||
Distribute informational posters and pamphlets.
|S||Employee motivation and wellness||Strive to create a work environment where each employee is healthy in body and soul and feels as if they are leading a fulfilled lifestyle in society.||
Achieve 75% usage of paid leave days by 2025.
Health examinations (target: 100%)
|Employee performance and career development||Aim to improve human resources by encouraging employee self-improvement through the provision of continuous education opportunities and incentives to acquire credentials.||Enhance contents of educational courses|
|Contribute to the community||Actively contribute to the community based on the understanding that an important challenge to business continuity is gaining social license to operate based on a relationship of trust with the community.||Study making contributions to society|
|G||Disclosure to and dialog with stakeholders||Build relationships of trust through active disclosure including non-financial information such as ESG-related activities and constructive dialog with stakeholders.||
IR with institutional investors: 210 meetings
IR with individual investors: 4,000 page views (online)
|Strengthen governance||Raise awareness of compliance and effect thorough adherence to laws and regulations by implementing training.||
Training participation: 100%
Training time: 4 hours/year
Ⅲ. Environmental Management System
For important ESG matters (materialities) independent environmental management systems (EMS) are built and run to continually achieve improvement on the issue.
At Mitsui & Co., Logistics Partners Ltd., which manages Japan Logistics Fund, Inc., KPIs are set and confirmed to endeavor to improve challenges identified by important ESG matters (materialities).
For KPIs related to the environment, in addition to assessing environmental performance data (energy consumption, greenhouse gas emissions and water use volumes) for the fiscal year for each property, a third-party assurance based on ISAE3000 (International Standard on Assurance Engagements) is obtained from an independent assurance institution.
In addition to environmental performance data, progress on materiality KPIs is monitored and reported at least once a year to the Sustainability Promotion Liaison Meeting, President, Representative Director and CEO and the Board of Directors, and a PDCA cycle is implemented, including a review of materialities and KPIs.
＜Environmental Management System (EMS) Flowchart＞
＜Conceptual diagram of the PDCA cycle＞