PRINCIPAL ADVERSE IMPACT STATEMENT
The following is the adverse sustainability impact statement of Japan Logistics Fund, Inc. ("JLF") pursuant to Regulation (EU) 2019/2088 ("SFDR"). JLF has no employees in accordance with the prohibition on having employees under the Act on Investment Trusts and Investment Corporations of Japan and relies on Mitsui & Co., Logistics Partners Ltd. (the "Asset Manager"), to manage and operate the properties in our portfolio. JLF and the Asset Manager are hereinafter referred to collectively as "we", "us" or "our". References to "fiscal year" or "FY" are to the 12 months began or beginning April 1 of the year specified in line with the fiscal year of the Asset Manager, unless noted otherwise.
1. Summary
We consider principal adverse impacts of our investment decisions on sustainability factors. The present statement is our consolidated statement on the principal adverse impacts on sustainability factors ("PAI"). This statement on PAI covers the reference period from February 1, 2022 to July 31, 2022. The statement will be reviewed at least once every year.
We believe that our sustainability initiatives are essential for our sustainable growth. We improve long-term returns of investors and contribute to the realization of sustainable society and urban development by implementing initiatives that address social issues. Under our sustainability policies and framework, we, in collaboration with the Asset Manager, take actions on climate change, including energy conservation, use of renewable energy, and being resilient in times of disasters.
We use the definition of PAI as described in Recital 20 of SFDR being "those impacts of investment decisions and advice that result in negative effects on sustainability factors", with sustainability factors referring to environmental, social and employee matters, respect for human rights, anti‐corruption and anti‐bribery matters as defined in article 2 (24) of SFDR.
We believe that investment decisions that negatively affect climate or other environment-related resources, or have negative implications for society, can have a significant impact to risk and value creation for our unitholders. To this end, we consider PAI of our investment decisions throughout all major steps of the investment decision and property management process throughout the lifecycle of the properties in our portfolio.
Please note that SFDR requirements, including the scope of their application to issuers outside the European Economic Area, continue to evolve. We are therefore taking a principles-based approach to compliance with the SFDR disclosure standards, which are subject to change.
2. Description of principal adverse sustainability impacts
Nearly all types of economic activity have the potential to impact various PAI indicators, both positively and adversely. We aim to manage the risk connected to PAI from our investment decisions in several ways, including general screening criteria, due diligence and our ESG initiatives. Some of the PAI indicators listed below are currently already being monitored and reported. As the availability of data improves, it is our intention that more indicators will be added.
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Table 1
Principal adverse sustainability impacts statement
JLF does not invest in investee companies, but invests in real estate. As adverse sustainability indicators 1-16 as contained in Table 1 of Annex 1 of the draft Delegated Regulation pertain to investee companies, these are not included in this PAI statement, which pertains to real estate investments.
Indicators applicable to investments in real estate assets
Adverse | Metric | Impact in | Impact in | Explanation | Actions taken, | |
sustainability | 2022 | 2021 | and actions | |||
indicator | planned and | |||||
targets set for | ||||||
the next | ||||||
reference | ||||||
period | ||||||
Fossil | 17. | Share of | N/A | N/A | We do not | N/A |
fuels | Exposure | investments in | invest in real | |||
to fossil | real estate | estate assets | ||||
fuels | assets | involved in the | ||||
through | involved in | extraction, | ||||
real estate | the extraction, | storage, | ||||
assets | storage, | transport or | ||||
transport or | manufacture of | |||||
manufacture | fossil fuels. | |||||
of fossil fuels | ||||||
Energy | 18. | Share of | As of July 31, | As of July 31, | To track the | Assets that |
efficiency | Exposure | investments in | 2022, 30.2% of | 2021, 56.0% of | environmental | receive outside |
to energy- | energy- | our properties | our properties | performance of | certifications | |
inefficient | inefficient real | (by leasable | (by leasable | our properties, | under our | |
real estate | estate assets | area) had not | area) had not | we use | green finance | |
assets | obtained | obtained | certifications | framework, | ||
neither | neither | issued by third- | and have | |||
Certification | Certification | party | energy | |||
for CASBEE | for CASBEE | organizations | reduction rate | |||
for Real Estate, | for Real Estate, | such as the | (ERR) of 30% | |||
ASBEE | ASBEE | Development | or higher are | |||
Certification | Certification | Bank of Japan's | defined as | |||
for Buildings | for Buildings | Green Building | "Green | |||
(New | (New | Certification | Eligible | |||
Construction), | Construction), | ("DBJ | Assets". We | |||
the BELS | the BELS | Certification"), | adopt | |||
Certification | Certification | Building | environmental | |||
nor the DBJ | nor the DBJ | Energy- | measures such | |||
Certification. | Certification. | efficiency | as LED | |||
Labeling | installation and | |||||
System | solar panel | |||||
certification | installation, | |||||
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("BELS
Certification"),
SMBC Sustainable Building Assessment Loan Program and Comprehensive Assessment System for Built Environment Efficiency ("CASBEE Certification") certification.
and aim to acquire more certifications accordingly.
Table 2
Additional climate and other environment-related indicators
JLF does not invest in investee companies but in real estate. As additional climate and other environment-related indicators 1-17 as contained in Table 2 of Annex 1 of the draft Delegated Regulation pertain to investee companies, these are not included in this PAI statement, which pertains to real estate investments.
Adverse | Adverse sustainability impact (qualitative or quantitative) | Metric |
sustainability | ||
impact | ||
Indicators applicable to investments in real estate assets | ||
Greenhouse gas | 18. GHG emissions | Scope 1 GHG |
emissions | emissions generated | |
Scope 1 GHG emissions generated by real estate assets were 0 t-CO2 | by real estate assets | |
(in FY2021). | ||
Scope 2 GHG | ||
Scope 2 GHG emissions generated by real estate assets were 963 t- | emissions generated | |
CO2 (in FY2021). | by real estate assets | |
Scope 3 GHG emissions generated by real estate assets were 31,447 t- | ||
From 1 January 2023, | ||
CO2 (in FY2021). | Scope 3 GHG | |
Total GHG emissions generated by real estate assets were 29,872 t- | emissions generated | |
by real estate assets | ||
CO2 (in FY2020) and 32,410 t-CO2 (in FY2021). | ||
Total GHG emissions | ||
generated by real | ||
estate assets | ||
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Energy consumption
19. Energy consumption intensity
Our total energy consumption intensity (based on gross floor area) of the properties in our portfolio was 0.173 GJ/m2 (in FY2020) and 0.175 GJ/m2 (in FY2021).
Our total energy consumption was 255,288 GJ (in FY2020) and 262,751 GJ (in FY2021).
Energy consumption in GWh of owned real estate assets per square meter
Table 3
Additional indicators for social and employee, respect for human rights, anti-corruption and anti-
bribery matters
JLF has no employees in accordance with the prohibition on having employees under the Act on Investment Trusts and Investment Corporations of Japan, and relies on the Asset Manager to manage and operate the properties in our portfolio. Accordingly, additional indicators for social and employee, respect for human rights, anti-corruption and anti-bribery matters in this PAI statement pertain to the Asset Manager and the tenants of the properties in our portfolio, to the extent available.
SOCIAL AND EMPLOYEE, RESPECT FOR HUMAN RIGHTS, ANTI-CORRUPTION AND ANTI-
BRIBERY MATTERS
Adverse sustainability impact
Adverse sustainability impact (qualitative or quantitative)
Metric
Indicators applicable to investments to the Asset Manager or tenants
Social and employee matters
5. Lack of grievance/complaints handling mechanism related to employee matters
The Asset Manager has established a hotline for employees which allows them to consult not only with a compliance officer, but also anonymously with outside counsel. All employees of the Asset Manager can report through the hotline a range of matters such as legal violation, violation of human rights, corruption, bribery and harassment through the hotline. Reported matters are promptly addressed and measures are taken to prevent recurrence under the CEO's supervision.
At our all of our properties, a grievance/complaints handling system has been established to allow tenants to report their
Share of investments in investee companies without any grievance/complaints handling mechanism related to employee matters
The Asset Manager has a grievance/complains handling mechanism for all employees.
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complaints to the Asset Manager through the property manager. More Specifically, under consignment contract made between the Asset Manager and the property manager, the property manager is responsible for acting as a contact point for daily complaints from tenants and reporting such complaints to the Asset Manager, and is obliged to submit a monthly report regarding tenant management to the Asset Manager.
For descriptions of actions which JLF takes and will take with respect to the PAI indicators, please refer to our ESG website with respect to JLF: https://8967.jp/en/esg/index.html
3. Description of policies to identify and prioritize principal adverse sustainability impacts
Subject to data availability, we monitor the selected PAI indicators for the existing properties in our portfolio.
Prior to our investment in a property, we conduct due diligence review of the property, including ESG due diligence, which includes selected PAI indicators. The due diligence findings related to selected PAI indicators are reported and reviewed prior to the investment decision.
The Asset Manager tracks and monitors on an ongoing basis consumption of energy, greenhouse gas emission and water consumption at our portfolio properties. The Asset Manager's Sustainability Promotion Liaison Meeting uses the data to assess progress made on against targets, discuss with President and CEO, Representative Director and the Board of Directors of the Asset Manager, and deliberate on necessary action plans every year.
For further information, please refer to our ESG website: https://8967.jp/en/esg/index.html
4. Engagement policies
Due diligence and screening
The Asset Manager considers principal adverse impacts of its investment decisions on sustainability factors, including those listed above. We and the Asset Manager believe that investment decisions that negatively affect climate or other environment-related resources, or have negative implications for society, can have a significant impact to risk and value creation for our unitholders. To this end, we and the Asset Manager consider the principal adverse impacts of our investment decisions on sustainability factors throughout all major steps of the investment decision and management process throughout the lifecycle of our portfolio properties.
At the properties we operate, we set numerical targets and monitor the amount of greenhouse gas emissions within the property in order to reduce our environmental burden.
Engagement
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Japan Logistics Fund Inc. published this content on 24 April 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 April 2023 02:46:05 UTC.