Basic approach of NBM and NBFM to social considerations is to hold dialogues with stakeholders (affiliates inside and outside the company) associated with its business activities including its investors, NBFM employees, tenants, business partners and local communities and to endeavor to meet their expectations.

<<Responsibilities to Main Stakeholders which NBF and NBFM are to Fulfill>>

• ・Investors: Distribution of stable income, maximization of investor value in the mid-to-long-term, and timely and appropriate disclosure of information
• ・Employees: Providing attractive working environments where its employees can work with peace of mind and development of human resources such as through training programs
• ・Tenants: Providing safe, secure and comfortable spaces and increasing tenant satisfaction
• ・Property management companies and business partners: Establishment of collaborative relationships in environmental and social considerations
• ・Local communities: Contribution to local vitalization and development

Recognizing that human resources are the most valuable resources of the company and are indispensable for the sustainable development of business and the organization, NBFM has strived to secure and develop specialists with extensive expertise in real estate and finance as well as potential leaders with management skills to improve organizational productivity.

In order to continuously improve expert know-how, NBFM promotes the acquisition of specialized certificates of its employees such as ARES Certified Master (an educational program that systematically teaches practical expert know-how in the fields of real estate and finance). NBFM bears the costs for the training and exams in acquiring the various certificates as well as for maintaining the certificates and increasing expert abilities through seminars, etc.
This program has been used by new employees as an opportunity to advance their career; and by experienced employees and certification holders as an opportunity to continuously build and enhance their expertise.

The number of employees with certificates are as shown below (includes employees seconded from sponsors, etc.).

• ARES Certified Master: 14
• Real estate notary: 24
• Real estate appraiser： 1
• Class-1 architect: 2
• Chartered Member of the Securities Analysts Association of Japan: 3
• Lawyer: 1
• Tax accountant: 1
• Certified Building Administrator: 6

For the purpose of periodically updating fundamental knowledge necessary for asset management, training programs led by outside lecturers are regularly conducted to learn the circumstances of the current economic environment and real estate market, revision of laws and regulations on asset management, etc. In addition, information exchange sessions are also held on a weekly basis for all employees to share knowledge on the circumstances surrounding the market and each financial sector in real time.

【Examples of training】

• ・Training by outside lecturer (In fiscal 2019, 9 programs were conducted on such themes as real estate market trends in financial administration, internal management systems, etc.)

• Example (1): By a think tank: “Real Estate Market” (February and August 2020, February 2021)
• Example (2): By an auditing company: “Risk Management/Compliance” (March 2021)
• Example (3): By a consulting company: “Risk Management/Compliance” (November 2020)
• Example (4): By Japan Exchange Group, Inc.: “Insider Trading Regulations” (November 2020)

・Information exchange sessions (held weekly)

In addition to the specialized education in the real estate, financial and other sectors mentioned above, NBFM introduced, with an aim to encourage ideas full of creativity through diversified viewpoints and sensibilities, a training support program in which the company will bear the costs of attending seminars, lectures and courses that lead to self-improvement as long as it is within the annual budget stipulated for each employee, By allowing access to trainings and educational opportunities appropriate for employees’ careers, NBFM focuses on the development of cross-sectoral human resources with wide vision, ideas and leadership that are not limited to the industry or domain.

【Examples of training by position/rank】

• ・General Manager: Management control (correspondence education program), various training programs provided by the sponsor, etc.
• ・Manager: Management training course, information security management training, training on legal and regulatory compliance in contract practices, etc.
• ・Associate: Effective writing training, course for mastering financial statements to understand basic accounting, etc.

FY2017 and FY2018（As of the end of February）, record of the training support program is as follows.

【Utilization status of the program】

◆Regularly conducts career interviews in NBFM

NBFM regularly conducts career interviews with all employees. All employees have an interview with their superior and directors. This program provides them with an opportunity to talk about their career formation, receive feedback on their performance and discuss requests to the company.
NBFM has established a transparent system for setting targets and providing appraisal feedback through proper communication between superiors and subordinates such as in conducting interviews at the beginning of periods (setting targets), mid-period interviews (checking progress and giving advice) and interviews at the end of periods (feedback of appraised results).

Furthermore, as described in the above “Cross-Sectoral Human Resources Development Program,” NBFM focuses on the development of human resources with wide vision, insight and ideas that are not limited to the industry or domain and human resources with leadership, by allowing access to trainings and educational opportunities appropriate for employees’ careers.

NBFM promotes development of specialized skills of existing employees through the aforementioned education/training programs while also continuing to hire new recruits in order to secure proper personnel timely to accommodate the business situations and changes in its organizational status. Furthermore, NBFM seeks longer employee retention and improved productivity through provision of sufficient benefit and welfare programs and establishment of a comfortable working environment to enable employees to continue working with peace of mind.
As part of these human resources strategies, NBFM takes in human resources from numerous sponsors and other entities with various backgrounds, aiming to realize sophisticated asset management through utilization of their highly specialized expertise as well as improvement of know-how in operations.

【The number of human resources taken in from sponsors】

• ・Mitsui Fudosan Co., Ltd. (46% equity ratio): 6
• ・Sumitomo Life Insurance Company (35% equity ratio): 2
• ・Sumitomo Mitsui Trust Bank, Ltd. (5% equity ratio): 1

Employees in managerial positions seconded from the sponsors, Mitsui Fudosan Co., Ltd. and Sumitomo Life Insurance Company, possess expert know-how as well as organization management skills nurtured through continuously participating in seconding companies’ human resources development programs and thus have contributed to NBFM from both aspects of asset management and vitalization of the organization.

[Career Programs of Mitsui Fudosan Co., Ltd.]
Human Resources Management/ESG Report 2019

At NBFM, the board of directors and general shareholders’ meeting oversee executive appointments and successions. Other managerial appointments and successions are discussed and determined by the Executive Board members including the CEO. We have prepared and implemented a human resource scheme, which allow us to select appropriate management candidates from NBFM and our sponsors, as well as smoothly transfer the businesses and duties.

While NBFM currently does not hire new graduates, our sponsors regularly do graduate recruitment. NBFM accepts seconded junior employees who have completed the training of the sponsor’s human resource development programs. For detailed information on graduate recruitment, please refer to the above “Career programs of Mitsui Fudosan Co., Ltd.”

Recognizing human resources as its greatest assets, NBFM aims to create environments where its employees can work with peace of mind. NBFM strives to establish and operate a more attractive and fruitful management system in health and safety initiatives such as for work life balance, health of employees, personnel management and risk management by fulfilling regulatory standards, introducing an early work shift system, establishing recommended paid vacation days and such to create a corporate culture that is conducive to work. Furthermore, NBFM has worked to further improve job satisfaction and create environments that are more conductive to work by setting up a cross-sectional work reform review team this fiscal year to exchange opinions and discuss programs for better work styles that benefit both the company and the employees.

NBFM recognizes its employees to be as its greatest resource. As such, it measures the satisfaction level of its employees and conducts employee satisfaction surveys every year as part of its efforts to establish excellent relations between employees and the company. With this, NBFM checks degrees of satisfaction towards assigned responsibilities and the working environment, requests for introduction of programs in the company, etc. (response rate of 100%). NBFM strives to establish better working environments based on the survey results.

【Case examples】

• ・In response to a request from employees, changed Premium Friday from the last Friday to the first Friday of the month due to many opinions that the end of month is a busy time
• ・Expanded the scope of assistance in education for self-improvement
• ・Established “social gathering” program in an aim to get all employees including temporary employees to communicate more with each other (The asset management company bears the payments for the costs)
• ・Reviewed rules for holding information exchange sessions with outside parties, etc. (expanded the scope of eligible employees) … and others

A system has been introduced whereby all employees including temporary employees can freely express a wide range of opinions related to personnel affairs, working environment and other matters anonymously (suggestion box “meyasubako”). The expressed opinions will be conveyed to those with management responsibility as needed.
In addition, employee interviews by directors are conducted once a year to give every employee an opportunity to clarify their requests concerning various internal systems of the Company as well their personal career vision.
Moreover, NBFM has established contact points inside and outside of the company for internal reports based on a whistleblower protection rule, thereby establishing a system in which violation of the human rights of employees, business partners and other parties as well as fraudulent or wrongful acts can be reported anonymously to a compliance officer (in the case of matters regarding a compliance officer, then to the CEO) or an external law firm. The rule prohibits creating any disadvantage for whistleblowers through efforts to protect whistleblower information and by prohibiting retaliatory action, while making it mandatory for companies to decide and implement appropriate measures for the reported issue.
In addition, if the whistleblower is disadvantaged as a result of their consultation or whistleblowing, they may report this to the contact points for internal reports. After receiving such a report, the contact points shall promptly take corrective measures related to the disadvantage and strive to protect the whistleblower.

The various benefit and welfare programs listed below have been established to create a working environment in which employees can continue to work in comfort and with peace of mind.

【Programs provided】

• ・Childcare leave and shortened work hours for childcare (All employees)
• ・Familycare leave and shortened work hours for nursing care (All employees)
• ・Special or consecutive summer holidays (All employees)
• ・Morning-focused working system (All employees)
• ・Programs provided by an external employee benefits services company (All employees(include temporary employees))
• ・Assistance in medical examination costs (All regular employees)
• ・Provision of satellite office (All employees)
• ・Employee recreational get-togethers (bowling, field days, golf, etc.; 5 to 6 times/year)
  (Employee recreational was not taken in FY2020 for the COVID-19 pandemic)

In September 2019 when the office was relocated, NBFM created the workspace giving considerations to employee well-being.

• ・Expansion of common space
  Before：59.6㎡⇒After：162.6㎡(approx. 2.7 times difference)
• ・Facilities which enhance employee wellness in the work space

・Expanded internal communication areas (gathering places for relaxation or informal meeting)

・Initiatives to prevent the spread of infection for Covid-19

Installation of employee assistance programs to provide safe work environment

◆Reduction of Excessive Working Hours and Overtime

NBFM has established a labor and management agreement (a “36 Agreement”) and conducts the following programs to reduce excessive working hours and overtime work.

・Monitoring working hours and consulting with employees
・Notifying employees and superiors of employees who may be working long hours
・Utilizing a system that restricts computer usage
・Using Premium Fridays to have early finishing days
・Encouraging taking at least two paid holidays at a time

◆Living Wage Support

NBFM’s basic policy is to not only comply with but exceed minimum wage rules in labor laws.

◆Labor Standard Violations

There were no serious violations of labor standards between January 1, 2020, and December 31, 2020.

In order to secure human resources with high-level knowledge and experience over the long term, improvement of internal systems including benefit and welfare programs and other schemes has been conducted. As a result, human resources for maintaining stable fund management have been secured.

Targeting all regular employees, NBFM introduced a “Employee stock purchase plan (ESPP)” in which employees can acquire investment units of NBF. With the introduction of this system, it is anticipated that employees will be more focused on improving the performance of NBF, which is believed to contribute to continuous growth of NBF and enhancement of investor value. Furthermore, NBFM provides financial incentives to employees utilizing the system in an endeavor to further enhance its benefit programs for employees.