Mitsubishi Estate Group's Relationships with Stakeholders

SUSTAINABILITY MANAGEMENT

Stakeholder Engagement

Contents

Basic Policy and Approach
Partnerships with Outside Organizations
Multi-stakeholder Policy
Stakeholder Engagement in Urban Development

Basic Policy and Approach

Stakeholder Engagement

Living up to its mission, “We contribute to society through urban development,” Mitsubishi Estate Group strives to contribute to creating a truly meaningful society by building attractive, environmentally sound communities where people can live, work and relax with contentment. The Mitsubishi Estate Group's business is built upon the foundation of its relationships with a wide variety of stakeholders, including customers, shareholders, local communities, government and local authorities, business partners, and executives and employees and their family members. Business activities in urban development involve many stakeholders by their very nature, and the Mitsubishi Estate Group has the responsibility to pursue its business activities while living up to the trust placed in it by these stakeholders. Based on the opinions of outside experts and others, the Group identifies the stakeholders involved in the conduct of its business and analyzes the relationship with each stakeholder and the degree of influence and other factors to determine the level of priority.To this end, the Group places great importance on stakeholder engagement, with the following as its main objectives.

Receiving recognition for the Group’s initiatives
Having stakeholders share their expectations and concerns related to the Group
Obtaining opinions on new social issues and themes and learning from best practices
Sharing with stakeholders the Group’s initiatives and corporate stance

In light of these objectives, the Group examines and implements the most suitable methods of engagement with each stakeholder (see “Methods for dialogue with stakeholders” below). The Mitsubishi Estate Group utilizes the opinions received through stakeholder engagement in its business and engages in two-way communication with stakeholders to maintain their trust and confidence, thereby ensuring the sustainable continuity of business.

Governance Structure

Daily stakeholder engagement efforts are conducted by each Group company and department in charge, which maintains close communications with each stakeholder, working in collaboration with the relevant departments of each Group company.

Opinions received through stakeholder engagement are compiled by Mitsubishi Estate's Sustainability Management and Promotion Department and provided as feedback to management for reflection in business operations and further development of initiatives.

The Group regularly reviews whether engagement with each stakeholder is effective and strives to minimize stakeholder engagement risks, such as overlooking stakeholder expectations and requests or failing to approach specific stakeholders adequately.

Methods for Dialogue with Stakeholders

Stakeholders	Definition	Opportunities for dialogue	Primary themes
Customers	Users of tenant buildings, parties to housing and condominium contracts, various subcontractors, etc.	Customer satisfaction surveys, questionnaires, etc. Communication through marketing activities	Urban development to create safety and security Quality and safety management for products and services Urban development to support declining birthrates and aging populations
Community and Society	Local community and local residents involved in the Mitsubishi Estate Group's business	Meetings with influential stakeholders Dialogues through cooperation with administrations, local government and NPOs Social contribution initiatives	Economic contributions to the community Promoting smart communities Sustainable use of forest resources
NGO・NPO	NGOs, NPOs, etc. that promote activities on themes related to the Mitsubishi Estate Group's business	Hold individual dialogues Collaborate in organizing events on specific themes Participate in events, seminars, etc. held by NGOs and NPOs	Climate Change Biodiversity Resource Circulation Water Resources Forest Conservation Human Rights Diversity etc.
Employees	Mitsubishi Estate Group employees	Communication via personnel evaluations Dialogue via compliance survey and other internal platforms	Developing the capabilities of employees, utilizing diverse human resources and providing equal opportunities Maintaining safety as well as physical and mental health
Business Partners	Construction subcontractors, cooperating companies, suppliers, etc.	Communication during operations Subcontractor evaluation systems, training sessions for registered construction firms, quality and safety promotion conferences, other Communication during procurement activities Disseminating the Supplier Code of Conduct and implementing interview surveys	Supply chain management Green procurement Urban development to create safety and security
Shareholders and Investors	Individual and institutional investors	Financial results briefings (twice a year) Small group meetings and property tours for analysts and investors One-on one meetings with Japanese and foreign institutional investors (around 300 meetings per year) Participation in various other online conferences, etc. ESG-specific presentations to shareholders Communication using IR tools	Economic performance Healthy corporate management

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Stakeholder Dialog Details

FY2022 Stakeholder Dialog Details

Main dialog partners: BSR, WWF Japan, experts on each subject, etc.
Dialog method: Online interviews (11 sessions)
Dialog time frame: April to June 2022

Theme	Stakeholder expectations for the Company, perceived issues
Climate change	It would be ideal to have procurement and ordering policies that promote concrete decarbonization efforts. As is apparent by the fact that so-called offsets are not allowed in SBTi target setting, there is a major trend toward not recommending the use of credits for the purpose of offset. When using credits to neutralize final residual emissions to contribute to reduction outside the scope of targets, it is important to confirm the details of whether sustainability is being guaranteed in the true sense. Proactive policy proposals on carbon pricing and energy saving performance standards are anticipated. Because of the high possibility that the approach to the biomass output coefficient will be changed, it is necessary to watch trends and consider how it should be handled.
Lumber	When promoting domestic lumber as qualifying as low risk, the company should confirm that the risk actually is low after performing human rights and environmental risk assessments. The same applies for the CLT business. Formulation of policies in pursuit of traceability and sustainability are anticipated for use of wood other than formwork plywood panels as well.
Plastic	With regard to the reuse and reduction of plastics and other waste, besides the 2030 targets, urgent establishment of KPIs targeting 2025 is anticipated. Also, in preparation for eliminating the cycle of mass production, mass consumption, and mass disposal, proactive collaboration with relevant parties is anticipated in order of waste reduction, reuse, and material recycling. With the goal of expanding Otemachi-Marunouchi-Yurakucho initiatives across the country in mind, the company must be conscious of its position as a base for each region and collaborate with tenants and waste disposal vendors to promote a circular economy far and wide in a sustainable manner.
Biodiversity	The company should conduct assessments not only on business areas, but also on the impact and reliance of biodiversity in areas that include suppliers of building materials, etc. Rather than conserving biodiversity for the purpose of CSR, the company needs to consider such preservation within its business operations. Effective public communication is expected in the future through SDGs ACT 5 and other channels.
Water	The company should evaluate the risks, opportunities, impact and dependence on the environment across the entire supply chain including raw materials procurement in terms of the watershed and operations. The company should establish water targets and strategies that link to the company’s overall strategy. For example, gravel has been improperly collected in some areas (Mekong River basin, etc.), resulting in environmental and social issues. It is anticipated to perform identification and risk analysis of areas where gravel used in concrete is collected and formulate a policy in pursuit of sustainability and traceability. At locations important to achieving the above water targets and strategy, the company should promote AWS certification while maintaining consistency with the overall water targets.
Human rights	An evaluation of the effectiveness of current risk reduction initiatives and disclosure of results is anticipated. The company should identify "human rights trafficking" as a possible human rights risk associated with hotel business and implement countermeasures. Efforts are anticipated on improving minimum wages and living wages, as well as policy proposals.
Supply chain management	The company is currently focusing efforts on labor conditions and environmental risks at construction sites. However, the company should conduct risk assessments on building materials (particularly steel, cement, and glass) going forward. Disclosure of the company's main supplier list is also anticipated.
Technology	As a company whose goal is urban development utilizing technology, the company should conduct risk assessments in line with the type and application of technologies it employs. Afterward, the company must formulate a Group-wide policy on technology use.
Diversity and inclusion	It is important to improve initiatives considering both "attribute-based diversity" and "experience/skill/knowledge-based diversity." To achieve this , it is vital to provide equal opportunities and analyze from various viewpoints whether any inequalities exist. Rather than viewing gender diversity as an issue of employee mindset, it is important to view it as a management issue. To do so, training for executives and the management on the importance of gender diversity is required. In addition to training, it may be a good idea to begin LGBTQI+ initiatives through an employee working group. Promotion of D&I among suppliers is also anticipated.

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FY2023 Stakeholder Dialog Details

Main dialog partners: FoE Japan、IGES
Dialog method: in person
Dialog time frame: October to November, 2023

Theme	Stakeholder expectations for the Company, perceived issues
Climate change	It is expected that gas use will be discouraged and alternatives such as heat pumps, distributed power sources, and EVs should be considered. ClimateTech companies (aiming to decarbonize heat) are emerging . It would be desirable to monitor equipment and technology in this area. The company needs to demonstrate to manufacturers and governments that there is a demand for decarbonized building materials. It would be ideal the industry as a whole to approach this issue, rather than the company on its own. There are also trends to conern, such as the melting of the ice shelves on the west coast of Antarctica. Science findings should also be monitored, and the real estate impacts of the physical risks of climate change should be closely monitored in the future.
Forest	Indirect procurement (in construction) is expected to be included in the Timber Procurement Guidelines. It is also expected to indicate a timeline for consideration. Obtainining complete traceability information is expected in confirming the risk of the timber being procured. In TNFD disclosure, risks should not only focus on developed properties and holding areas, but also on traceability back to the production sites (logging sites) of raw materials for building materials, including timber.

Theme

Stakeholder expectations for the Company, perceived issues

Climate change

It is expected that gas use will be discouraged and alternatives such as heat pumps, distributed power sources, and EVs should be considered.
ClimateTech companies (aiming to decarbonize heat) are emerging . It would be desirable to monitor equipment and technology in this area.
The company needs to demonstrate to manufacturers and governments that there is a demand for decarbonized building materials. It would be ideal the industry as a whole to approach this issue, rather than the company on its own.
There are also trends to conern, such as the melting of the ice shelves on the west coast of Antarctica. Science findings should also be monitored, and the real estate impacts of the physical risks of climate change should be closely monitored in the future.

Forest

Indirect procurement (in construction) is expected to be included in the Timber Procurement Guidelines. It is also expected to indicate a timeline for consideration.
Obtainining complete traceability information is expected in confirming the risk of the timber being procured.
In TNFD disclosure, risks should not only focus on developed properties and holding areas, but also on traceability back to the production sites (logging sites) of raw materials for building materials, including timber.

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Partnerships with Outside Organizations

Partner organization	Overview	Our role
The Association of Real Estate Agents of Japan	The Association's members are major and medium-sized housing manufacturers and real estate companies that focus on real estate marketing activities. The Association aims to improve the various systems related to real estate transactions through related investigations, research, and proposals, etc.	Deputy Director Board Members Corporate Advisor
Real Estate Companies Association of Japan	The Association's members are companies that engage in urban and community development. It conducts investigations and research on systems related to real estate, makes policy proposals, and conducts social contribution activities to make it possible to proactively and effectively promote the supply of high-quality offices and homes and the smooth distribution of a stock of housing.	Deputy Director Board Members Corporate Advisor
Japan Building Owners and Managers Association	As Japan's only nationwide organization of business operators who own and manage office buildings, the Association conducts investigative research and awareness-raising activities related to building operation and management, etc.	Chair
Council for Area Development and Management of Otemachi, Marunouchi and Yurakucho	The Council engages in efforts related to urban development in light of the "Guidelines for the Redevelopment of the Area" of the Otemachi, Marunouchi, and Yurakucho areas of Tokyo, in collaboration with companies, organizations, and governmental agencies, etc., in an aim to increase the area's value and achieve sustainable development of central Tokyo.	Regular Members Director Chair Committee Chair
Association for Creating Sustainability in Urban Development of the Otemachi, Marunouchi, and Yurakucho Districts (Commonly known as the "Ecozzeria Association")	The Association operates the "CSV Business Creation Platform" that aims for better urban development and to resolve social issues directed toward achievement of the "Otemachi, Marunouchi, Yurakucho (OMY) Sustainability Vision." It works to create opportunities for interaction between companies and many people inside and outside the OMY area, build CSV business that sustains development of "environment," "economy," and "society" on that foundation, conduct R&D related to cutting-edge technology that contributes to creation of a sustainable society, etc., and implement awareness-raising activities.	Regular Members Board Members Auditor
OMY Area Management Association (Commonly known as "Ligare")	The Association handles "soft" components of urban development of the OMY area. It plans and operates events and other activities, conducts public relations, and engages in investigational research, and otherwise conducts activities as the instrument advancing systems established by government, such as the "Tokyo Municipal Ordinance on Promoting the Syareta-Machinamidukuri, the Creating of an Attractive and Exceptional City" and outdoor advertising projects.	Regular Members Deputy Director Board Members
The Industrial Federation for Human Rights, Tokyo The Corporate Federation for Dowa and Human Rights Issues, Osaka	Recognizing that human rights are the foundation of sustainability, the Federation works to solve a variety of human rights problems, such as the problem of discrimination, from a corporate perspective.	The organization is operated independently by members (human rights staff).

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Distribution of Economic Value to Stakeholders

Multi-stakeholder Policy

See the following for Mitsubishi Estate’s multi-stakeholder policy.

Multi-stakeholder Policy (Japanese only) (PDF 366KB)

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Stakeholder Engagement in Urban Development

The Group engages with stakeholders, including local communities, and takes into account their opinions in the development process.

An Example in Development of New Condominiums

The Park House Jiyugaoka Diana Garden received comments from stakeholders, including local communities, at the time of planning regarding its biodiversity initiatives, and introduced the BIO NET INITIATIVE, an initiative implemented by Mitsubishi Jisho Residence to conserve biodiversity. The following activities have been carried out. The property is located in the urban area of Jiyugaoka, but has become a rare property that retains a large green space.

(1) Securing the amount of greenery and attracting species through large-scale green spaces
25% of the site has been converted to green space through the use of traditional plants and native species, leaving an area contributing to biodiversity of over 29% of the site.

(2) Use of environmental surveys (covering houses, vegetation, and ecosystems) before construction begins and donation to the community
The planned site is the former residence of the late Yonekichi Hiraiwa, known as a leading researcher on canines and wolves, which was called "Hakuhisou. The results of a survey conducted in cooperation with the Nature Conservation Society of Japan were used in the project and donated to the Museum of Modern Japanese Literature and J-Spirit.Inc, which serves as the secretariat for the Jiyugaoka Townscape Formation Committee, an urban renewal promotion corporation that aims to promote urban development and landscape formation in the Jiyugaoka area.

(3) Preservation of existing trees, topsoil and rare plants
We have conducted temporary off-site storage of existing trees, topsoil, and rare plants, and their re-planting on the proposed site. We have also successfully created of new homes for creatures that prefer a grassland environment and habitat for creatures that have existed in the soil.

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