Materiality

Materiality

Materiality

Through the meetings of the Sustainability Committee, IIF has examined its vision and targets for sustainability and carried out efforts toward their realization. As the level of interest toward sustainability is rising, the asset manager has further clarified the responses to be taken by identifying and visualizing related to sustainability materiality through dialogue with global stakeholders and collaborative efforts with other organizations. These issues were identified based on the Mission Statement and Sustainability Policy.

Materiality

Indicative List of Sustainability Issues

  • Climate change response
  • Resilience
  • Biodiversity
  • Water resources
  • Waste
  • Human rights
  • Human capital (employee engagement, Diversity, equity, and inclusion, employee health, well-being, and convenience)
  • Tenant health, well-being, and convenience
  • Partnerships with stakeholders
  • Supply chain management
  • Compliance and corporate ethics
  • Information disclosure
  • Data management systems and information security

Third-Party Opinion | Ryuichi Horie Co-founder and CEO CSR Design Green Investment Advisory, Co., Ltd.

"Since identifying materiality in 2019, your company has conducted regular reviews, steadily addressing each issue while setting KPIs and targets. Based on the status of initiatives, as well as domestic and global trends, you have now significantly revised your materiality. Particularly with regard to "biodiversity," as its importance is growing for companies that deal with real estate, you have advanced your efforts for specifying dependencies and impacts on natural capital, as well as implementing relevant initiatives at your properties. The fact that you now have clearly positioned biodiversity as a materiality issue can be considered an advanced initiative within the real estate management sector. Regarding "human rights", you have advanced the establishment of systems through human rights due diligence, risk management, and monitoring, demonstrating your company's commitment to respect for human rights, which is clearly stated in your human rights policy.
Furthermore, through re-sorting of risks and opportunities, you have more clearly shown why each issue is important. Also, by rearranging KPIs and targets according to the actual status, you have enhanced their alignment with initiatives. I expect you will further deepen your responses to each issue going forward while conducting reviews as necessary."

Materiality and KPIs

In 2025, in response to changes in the times and international trends, a review of materiality was conducted. In principle, materiality is reviewed regularly once every three years.
The revised materiality topics are presented below.

This table can be scrolled sideways.

Materiality Risks Opportunities KPIs Targets Initiatives
Environmental
Climate Change Response
  • Decrease in tenant sales (or rental income) and increase in property damage due to physical impacts of climate change
  • Increase in energy-related costs
  • Strengthening of environmental regulations
  • Decline in evaluations from tenants and investors
Cost reduction through efficient energy use GHG emissions Reduce total GHG emissions by 42% compared to FY2021 (Scope 1 & 2, target year: 2030)
  • Promotion of energy-saving measures for owned properties
  • Introduction of renewable energy
Environmental certification acquisition ratio
  • Logistics facilities: 70% or higher
  • Portfolio-wide certification: 60% or higher (target year: 2030)
Continuous acquisition of CASBEE Real Estate
Evaluation and DBJ Green Building Certification
Resilience Increased costs for recovery and compensation after disasters Improvement of property competitiveness Emergency contact network development rate Maintain 100% implementation rate
  • Implementation of disaster prevention measures
  • Conducted building assessments and seismic risk assessments at the time of property acquisition
  • Obtained engineering reports on a regular basis
Water Resources Increased costs due to higher water consumption Cost reductions through reduced water usage Water consumption
  • Reduction of water consumption
  • Intensity-based change: ±0% compared with FY2021 (target year: FY2030)
  • Implementation of water reduction initiatives
  • Effective use of recycled water (greywater) within the property premises.
Biodiversity Decline in evaluation by tenants and investors that prioritize sustainability
  • Expansion of investor base
  • Improved sustainability evaluation through contribution to international conservation targets
Biodiversity-related certifications Maintain existing certifications
  • Conservation of biodiversity at properties
  • Implementation of biodiversity preservation activities
Waste
  • Increased waste treatment costs
  • Reputational risk from increased waste generation
Reduction of waste disposal costs through waste reduction Recycling rate for properties under the Investment Corporation’s controllable management scope Improved compared with FY2022 (FY2022 recycling rate: 40.5%) Monitoring of waste generation
Social
Tenant Health, Comfort, and Convenience Decline in property competitiveness
  • Improved sustainability evaluation
  • Improved tenant and occupant satisfaction
Tenant satisfaction survey implementation rate 100% implementation rate
  • Regular renewal of air conditioning and restrooms
  • Installation and improvement of communication and refresh spaces
Stakeholder Partnerships
  • Increased tenant burden regarding safety and environment
  • Decline in tenant satisfaction
  • Attractive properties for tenants
  • Stable profit generation
Number of green leases introduced Continuous expansion -
Number of tenant sustainability initiatives Promote tenant-led sustainability initiatives through engagement -
  • Deterioration of surrounding environment
  • Local reputational decline
  • Community revitalization
  • Improved corporate image
Community engagement events Regular implementation
  • Site provision for events (e.g. Shonan HIP)
  • Environmental conservation liaison meetings
Human Rights Reputational damage due to human rights impacts Building stakeholder trust Human rights due diligence frequency Once per year
  • Preventive measures and monitoring
  • Training and information sharing
Human Capital
(HR Development, DEI, Well-being)
Loss of talented personnel
  • Work-life balance
  • Improved employee engagement
① Male childcare leave usage rate
② Female manager ratio
③ Annual training hours
④ Employee satisfaction survey
① 50% usage rate (At least one employee has taken childcare leave.)
② 20% female managers (2027)
③ 20 hours/person/year
④ Annual survey
  • Awareness via handbooks
  • Training programs
  • Working hour monitoring
  • Satisfaction surveys
Governance
Information Disclosure
  • Deterioration of stakeholder relations
  • Decline in market evaluation
Building stakeholder trust Number of disclosures
  • IR & investor briefings
  • Annual sustainability report
  • IR activities
  • GRESB & CDP participation
  • Framework-aligned disclosure
Compliance & Corporate Ethics
  • Compliance risk emergence
  • Reputational damage
Improved customer trust Compliance training participation rate 100% participation
  • Multiple annual trainings
  • Annual compliance programs
  • Internal/external whistleblowing hotlines
DFF Inc., Industrial & Infrastructure Fund Investment Corporation, Mitsubishi Corp. - UBS Realty Inc.