Proxy Voting

1. Principle of proxy voting

In proxy voting, we always act in the best interest of beneficiaries, striving to enhance corporate value of investee companies or prevent impairment. In making decisions regarding proxy voting, we not only make use of a systematic checklist, but also use our regular dialogue with investee companies to examine individual agendas based on the company’s current situation, with improvement of corporate value in mind.
Furthermore, we endeavor to safeguard the interests of beneficiaries by building a framework for effective prevention of conflicts of interest in the exercise of proxy voting.

2. Proxy Voting Process and Managing Conflicts of Interest

We have established policies and guidelines for proxy voting to contribute to the interest of beneficiaries, striving to enhance corporate value of investee companies or prevent impairment, through proxy voting.

The policy and guidelines of proxy voting which are formulated by the Equity Investment Department within the Investment Division so as to contribute to the enhancement of the corporate value of investee companies, are determined by the head of Investment Division(director), after consultation with “Responsible Investment Council (*1) ” independent from the Corporate Planning Division and the Marketing Division and the“ Supervisory Committee on Responsible Investment (*2) ”, majority of which consists of outside directors. In particular, we ensure appropriate management of proxy voting from the perspective of managing conflicts of interest through discussions at the Supervisory Committee on Responsible Investment.

In principle, the decisions of proxy voting are determined by the Equity Investment Department in accordance with the policies and guidelines. Particularly for domestic equities, analysts who conduct corporate research thoroughly examine individual proposals, use our regular dialogue with investee companies, and make decisions on individual proposals in accordance with actual conditions, with improvement of corporate value in mind.

Additionally, we will effectively prevent conflicts of interest by using a proxy adviser or having decisions made by the director in charge of the Investment Division after discussions at the Responsible Investment Supervisory Committee(*3). In addition to the results of these exercises, in the case of making a decision that differs from the proxy voting guidelines, the result shall be reported to the Responsible Investment Supervisory Committee to ensure transparency.

In order to improve the corporate governance of investee companies and enhance their medium- to long- term corporate value through the proxy voting, we believe it is necessary to make efforts to ensure that investee companies understand the reasons and background behind our decisions on proxy voting. For this reason, besides the policy and guidelines of proxy voting, especially for domestic stocks, we will also disclose results of individual proxy voting.

• Policy and Criteria for Exercising Voting Rights in Japan(Japanese)
• Exercise of Proxy Voting Rights for Foreign Stocks(Japanese)
• Policy for Exercising Voting Rights in Foreign countries (Japanese)
• Policy and Criteria for Exercising Voting Rights in J-REIT (Japanese)
• Exercise of Proxy Voting Rights for J-REIT (Japanese)

• “Responsible Investment Council”： It's chaired by the head of Investment Division(director), and the main members are the investment managers of equity and bonds and other investment-related personnel.
• “Supervisory Committee on Responsible” : The committee was established with the aim of ensuring appropriate stewardship activities and other operations from the viewpoint of supervising conflicts of interest. It consists of three independent outside directors and the director of the Legal and Compliance Department, with majority of outside directors.
• Identification of companies that may have conflicts of interest and efforts to manage conflicts of interest
  • Companies with particularly high likelihood of conflicts of interest and proxy voting to those companies
    In principle, we consider that our interested parties (subsidiaries and affiliates of us and Nippon Life Insurance Company (hereinafter “Nippon Life”) ), and companies which board members of us and/or Nippon Life have been appointed as directors and/or statutory auditors (including nominees) , have a particularly high possibility of causing conflicts of interest. Decisions concerning proxy voting in these companies are made according to proxy advisors’ recommendations.
  • Companies with high likelihood of conflicts of interest and proxy voting to those companies
    We consider that our major clients and companies in which Nippon Life has a high shareholding ratio, have a high possibility of causing conflicts of interest. In proxy voting for these companies, if decisions concerning proxy voting are differed from our guidelines, the decision will be made after prior consultation with the "Responsible Investment Supervisory Committee" in principle.