Materiality

Materiality Identification Process

Step 1　Identification of Issue Items
With reference to the evaluation items of the main evaluation organizations (GRESB, etc.) and disclosure frameworks (GRIs, etc.) related to sustainability of the Investment Corporation, issues were identified over a wide area based on the expectations of stakeholders and the status of other companies in the same industry.

Step 2　Focusing and Prioritizing
Formulate materiality (draft) by organizing and integrating issues as appropriate and prioritizing them in light of social trends and expectations demanded by internal and external stakeholders and the impact on the business and performance of the Investment Corporation.

STEP 3　Meetings, Validation and Approval by Management
The materiality (draft) is discussed external specialized institution and management, including President ＆ Chief Exective officer of MIJA, and approved by the Sustainability Committee of MIJA identify materiality.

Identified Materiality

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Environment (E)
	Responding to Climate Change/Enhancing Portfolio Resilience
	KPIs and targets	GHG Emissions (Scope 1 + 2)	Target: 42% reduction by FY 2030 (based on FY 2021)
		Total GHG Emissions For the entire Value Chain	Target: Achieving Net Zero by FY 2050
		Energy consumption intensity	Target: 15% reduction by FY 2030 (based on FY 2017)
	Policy	We aim to reduce greenhouse gas emissions by introducing equipment that contributes to energy efficiency and energy conservation in our portfolio.
	Page	https://mel-reit.co.jp/en/esg/environment/
	Resource savings
	KPIs and targets	Water consumption intensity	Target: Not increased by FY 2030 (based on FY 2017)
		Waste recycling	Target rate: 70% or more by FY 2030
	Policy	We will promote the efficient use of resources (including water) and promote the reduction and recycling of waste. When disposing of waste, we comply with laws and regulations and properly dispose of such waste (including hazardous substances).
	Page	https://mel-reit.co.jp/en/esg/environment/
	Promotion of Green Portfolio/Active Receipt of Environmental Certification
	KPIs and targets	Environmental Certification	Target: Increase to 100% by FY 2030
	Policy	Obtain various Environmental Certifications and visualize the objectivity and performance of GHG emissions reductions.
	Page	https://mel-reit.co.jp/en/esg/external/greenbuilding.html

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Society (S)
	Improvement of Health, Safety and Comfort/Improvement of Tenant Satisfaction
	KPIs and targets	Regular implementation of Tenant Satisfaction Surveys
	Policy	We aim to improve tenant satisfaction by conducting regular tenant satisfaction surveys, conducting renovation work in response to diversifying social needs, and expanding tenant support services. (environmental and energy-saving measures, health, safety, comfort improvement, etc.)
	Page	https://mel-reit.co.jp/en/esg/social/
	Contribution to local communities and implementation of community contribution programs
	KPIs and targets	Regular implementation of community contribution programs
	Policy	We will strive to contribute to society by regularly implementing community contribution programs (including participation in local cleaning activities) and contributing as a disaster prevention center for our portfolio.
	Page	https://mel-reit.co.jp/en/esg/social/communities.html
	Creating a safe and comfortable work environment for everyone and improving employee satisfaction
	KPIs and targets	Implementation of an employee satisfaction survey
		Acquisition rate of paid holidays	Target: 90% or more (calculated by employees on April 1 of each fiscal year)
		Female management ratio	Goal: 30%（By FY 2030）
		Acquisition rate of childcare leave	Goal: 100%（By FY 2030）
	Policy	We will respect the basic rights and diversity of our employees and create an environment and system that maintains a good work-life balance.
	Page	https://mel-reit.co.jp/en/esg/social/diversity.html
	Human Resource Development by Enhancing Continuous Training
	KPIs and targets	Training hours per employee
		Number of qualified employees
	Policy	We regard employees as important management resources "human assets" for a company, and conduct various types of training to improve a wide range of expertise and skills, as the growth of employees is essential to our growth as a company.
	Page	https://mel-reit.co.jp/en/esg/social/developing.html

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Governance (G)
	Thorough Compliance and Risk Management
	KPIs and targets	Meetings of the Compliance Risk Management Committee	Target: Held as needed
		Frequency of compliance and risk management training sessions	Target: 4 times par year
		Compliance and Risk Management Training Participation Rate	Target: 100%
		Safety confirmation training	Target: twice a year
		Internal audit
	Policy	We aim to thoroughly comply with laws and regulations by fostering each employee's awareness of compliance and risk management and enhancing his/her knowledge. We will conduct appropriate internal audits to ensure effective internal controls. We will prevent unfair and impartial transactions with stakeholders based on internal regulations and deliberations by the Compliance and Risk Management Committee.
	Page	https://mel-reit.co.jp/en/esg/governance/compliance.html
	Enhancing Governance
	KPIs and targets	Frequency of the Board of Directors of MEL
		Attendance rate for the Board of Directors of MEL
	Policy	We aim to build a governance system by ensuring the third-party nature and diversity of the Directors of MEL.
	Page	https://mel-reit.co.jp/en/esg/governance/corporate.html
	Enhance Clear Information Disclosure and Engagement with Stakeholders (Investors)
	KPIs and targets	GRESB、MSCI、PRI
		Number of IR meeting
	Policy	We aim to build an strong relationship of trust by disclosing information in a timely, appropriate, and proactive manner, including sustainability information, and regularly holding engagement with stakeholders (investors) through business activities that utilize IR and other means.
	Page	①https://mel-reit.co.jp/en/esg/external/environmental.html ②https://mel-reit.co.jp/en/esg/social/investor.html