Aberdeen Japan Equity Fund : ESG Equity Analysis

January 2021

Aberdeen Japan Equity Fund, Inc. (JEQ)

ESG Equity Analysis

Our comprehensive process, conducted by the investment team with support from our ESG Equity Analysts, culminates in a qualitative assessment of risk and opportunities in our due diligence process. Amongst the key features of our approach are sector-tailored assessments of a company's board structure, employee reviews, supply chain management, ability to navigate evolving climate change demands, environmental impact and capital management. This is cross checked with external information providers, while the engagement from our investment team takes place through management conversations and active proxy voting.

Our approach - fully embedded, investment led and horizon matched:

• Investment team leads on ESG assessment and engagement, with support from the ESG Equity Analysts
• Qualitative and sector-differentiated assessment of opportunities and risk, with ESG entrenched in the investment process
• Engagement from investment team through corporate contact and active proxy voting

Our assessment - holistic identification of material risks and opportunities:

• Company's board structure
• Employee reviews
• Supply chain management
• Environmental impact
• Capital management
• Climate change opportunities and risks

The result - construction of portfolios that reflect a responsible stewardship of capital at their core:

• Above average ESG score across our funds, with notably lower carbon footprints
• Improved risk-reward profile from corporates through board renewal, removal of poison pills, better capital allocation, improved disclosure
• Engagement ahead of market and external information providers potentially leads to higher total shareholder return and lower stock volatility

Christina Woon,

Investment Manager, Asian Equities

01 of 02 ESG Equity Analysis

Visit us online aberdeenjeq.com

IMPORTANT INFORMATION

Closed-end funds are traded on the secondary market through one of the stock exchanges. The Company's investment return and principal value will fluctuate so that an investor's shares may be worth more or less than the original cost. Shares of closed-end funds may trade above (a premium) or below (a discount) the net asset value (NAV) of the Company's portfolio. The net asset value (NAV) is the value of an entity's assets less the value of its liabilities. The market price is the current price at which an asset can be bought or sold. There is no assurance that the Fund will achieve its investment objective. Past performance does not guarantee future results.

International investing entails special risk considerations, including currency fluctuations, lower liquidity, economic and political risks, and differences in accounting methods; these risks are generally heightened for emerging market investments. Concentrating investments in the Japan region subjects the Fund to more volatility and greater risk of loss than geographically diverse funds.

Equity stocks of small and mid-cap companies carry greater risk, and more volatility than equity stocks of larger, more established companies.

The above is for informational purposes only and should not be considered as an offer, or solicitation, to deal in any of the investments mentioned herein. Aberdeen Standard Investments (ASI) does not warrant the accuracy, adequacy or completeness of the information and materials contained in this document and expressly disclaims liability for errors or omissions in such information and materials.

Some of the information in this document may contain projections or other forward looking statements regarding future events or future financial performance of countries, markets or companies. These statements are only predictions and actual events or results may differ materially. The reader must make his/her own assessment of the relevance, accuracy and adequacy of the information contained in this document, and make such independent investigations, as he/she may consider necessary or appropriate for the purpose of such assessment.

Any opinion or estimate contained in this document is made on a general basis and is not to be relied on by the reader as advice. Neither ASI nor any of its agents have given any consideration to nor have they made any investigation of the investment objectives, financial situation or particular need of the reader, any specific person or for any loss arising whether directly or indirectly as a result of the reader, any person or group of persons acting on any information, opinion or estimate contained in this document.

ASI reserves the right to make changes and corrections to its opinions expressed in this document at any time, without notice.

Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of the reader, any person or group of persons acting on any information, opinion or estimate contained in this document.

In the United States, Aberdeen Standard Investments is the marketing name for the following affiliated, registered investment advisers: Aberdeen Standard Investments Inc., Aberdeen Asset Managers Ltd., Aberdeen Standard Investments Australia Ltd., Aberdeen Standard Investments (Asia) Ltd., Aberdeen Capital Management, LLC, Aberdeen Standard Investments ETFs Advisors LLC and Aberdeen Standard Alternative Funds Limited.

02 of 02 ESG Equity Analysis

Ref: US-280121-141330-2 36740-0121-PHL