Basic Policy for Customer-Oriented Business Conduct
The concept of customer-oriented business conduct (fiduciary duty) is in recent years generally interpreted as going beyond its original meaning of "obligations of a trustee based on a trust agreement" and is defined to refer collectively to "the broad range of roles and responsibilities to be assumed by a person engaged in certain business activities in order to fulfill the trust that is placed by another party". For asset management companies like ourselves, the "fiduciary duty" encompasses the duties and responsibilities that are based on the fiduciary relationship between investors and an asset management company. We believe that this fiduciary relationship is not something that is bound merely by the terms of an agreement, but calls for real estate management professionals to conduct business with a view to maximizing investors' interests.
ORIX Asset Management Corporation has established the "Basic Policy for Customer-Oriented Business Conduct" based on this concept as provided hereunder.
Basic Policy for Customer-Oriented Business Conduct
Policy 1 Establishment and Announcement of the Policy
ORIX Asset Management Corporation (hereafter “the Company”) has established and hereby announces the “Basic Policy for Customer-Oriented Business Conduct.” Operating with pride and confidence as the asset management company of ORIX JREIT Inc. (hererafter “OJR”), the Company endeavors to conduct business operations with a focus on OJR and its unitholders, and will make a periodic report on the status thereof.
Policy 2 Pursuit of Customers' Best Interest
The Company is committed to being honest and fair in pursuing stable, efficient, and highly transparent asset management, bearing in mind OJR’s management philosophy of “Aim for sustainable growth of unitholder value,” which the Company believes to be in the best interest of its unitholders.
* For details on OJR’s management philosophy, please see below.
Policy 3 Managing Conflicts of Interest
The Company has established and complies with internal rules pertaining to conflicts of interest that may arise with unitholders and parties with vested interest in the Company (hereafter “affiliates and other parties”). For instance, when utilizing the ORIX Group‘s network, we will manage it appropriately to prevent any conflicts of interest between the ORIX Group and our customers, and ensure that the customers’ interests are not harmed unfairly. Specific measures to be taken include, to prevent any adverse effects related to transactions between parties that may have a conflict of interest, the Company has put in place a process whereby certain transactions conducted by OJR with affiliates and other parties are checked by deliberating in the Risk Management and Compliance Committee of the Company. The Company is not engaged in sales, nor solicitation of financial products or services, so there is no possibility of the conflicts of interest that can arise through the sale or recommendation of financial products.
Policy 4 Clarification on Fees and Commissions
In OJR’s securities report, the Company will clearly state information concerning the types of commissions and its calculation methods. Commissions that will be borne by OJR include asset management fees, OJR’s director compensation, accounting auditor compensation, general operational fees for administrative work related to institutional operations such as the management of Board of Directors meetings, General Unitholders’ meetings and other bodies, unitholder registry administration fees, account management fees, asset custodian fees, general operational fees relating to accounting, etc., general operational expenses relating to investment corporation bonds, management fees to property management companies and others.
Policy 5 Provision on Important Information in an Easy-to-Understand Manner
The Company and OJR are highly committed to transparent asset management and will properly disclose information swiftly, accurately, and fairly from unitholders' perspective.
The Company is not engaged in sales, nor solicitation of financial products or services, and has no policy on the structure of financial products.
* For details on OJR's disclosure policy, please click here.
Policy 6 Asset Management Preferred by Customers
The Company is committed to asset management preferred by customers and, as a diversified J-REIT, implements various types of strategies that are conducive to the sustainable growth of unitholder value from a medium to long-term perspective. Furthermore, the Company, through its IR activities, will seek to communicate with customers that are easily understandable. Furthermore, recognizing that REITs are listed on stock exchanges and are therefore purchased by a wide range of customers, we strive to manage assets in accordance with the OJR philosophy, taking into consideration the needs of customers, etc., while collaborating with related parties such as securities companies, who are responsible for sales and recommendations, etc. In addition, the Company is not engaged in sales, nor solicitation of financial products or services, and has no policy on the structure of financial products.
* For an overview of OJR’s strategies, please click here.
Policy 7 Motivation for Executives and Employees, and Development of Effective Internal Structures
The Company fully recognizes the importance of social responsibilities and public missions required of OJR, and regards compliance with social norms based on high ethical standards, as well as compliance with laws and regulations, as the utmost important issues in management. Performance evaluation of the Company’s directors and employees is conducted from the point of view of contribution to the sustainable growth of OJR’s unitholder value as well as from perspective of practice of compliance in the conduct of operation that forms the basis of the foregoing. Furthermore, the Risk Compliance Program that was approved by the Company’s Board of Directors stipulates periodic compliance training to directors and employees, while for organizational planning, a highly effective screening process that incorporates supervisory function led by external committee members has been established. Through these and other measures, the Company endeavors to enhance its compliance and governance structures.
*For details on risk management and compliance initiatives of the Company and OJR, and for details on supervisory function led by external committee members, please click here.
Actual Performance
Actual performance for each policy is as follows.
Policy 2 Pursuit of Customers' Best Interest
For OJR's strategies, please see below.
External Growth Strategy
Internal Growth Strategy
Financial Strategy
For OJR's actual distribution, please see below.
Distributions
Financial Data
Overview of Interest Bearing Liabilities
Policy 3 Managing Conflicts of Interest
Please see "Policy on Transactions with Affiliates and Transaction Records with Parties with a Vested Interest" on "Initiatives against conflicts of interest" at the following link.
Governance Initatives
Policy 4 Clarification on Fees and Commissions
Please see "Administrative Expenses" on ORIX JREIT ("OJR") Report in the following IR Library.
IR Library
Policy 5 Provision on Important Information in an Easy-to-Understand Manner
For OJR's disclosure, please see below.
Press releases
IR Library
Policy 6 Asset Management Preferred by Customers
For OJR's IR activities, please see "Proactive IR activities" at the following link.
Investor Relations
Policy 7 Motivation for Executives and Employees, and Development of Effective Internal Structures
For our human capital strategies, please see below.
Human Capital Strategies
Established: September 26, 2017
Last updated: May 25, 2023