Japan Excellent Asset Management Co., Ltd. (“JEAM”) has been entrusted with asset management by Japan Excellent, Inc. (“JEI”).
Viewing JEI and JEI’s unitholders as its own customers, JEAM created and announced the following Policy for Customer-Oriented Business Conduct for the purpose of achieving operations and management that focus on customers’ needs and JEAM revises its policies as required in order to achieve more effective business operations.
Pursuing Customers’ Best Interests
As a financial business, JEAM maintains a high level of expertise and professional ethics and conducts business with customers in a fair and sincere manner with their best interests in mind.
It also strives to instill this management approach within its corporate culture.
Appropriate Handling of Conflicts of Interest
In accordance with the laws, internal rules, etc., JEAM accurately assesses the possibility of conflicts of interest in transactions with customers, and in cases where such a possibility exists, it manages these transactions in an appropriate manner based on methods such as obtaining the approval of the Compliance Committee before proceeding with the transaction and having the Investment Committee discuss it and pass a resolution.
In the Rules for Transactions with Sponsor-Related Parties, JEAM has stipulated restrictions on transactions between JEI and sponsor-related parties in which JEAM or JEI has designated interests.
For example, for certain transactions such as the acquisition of properties from sponsor-related parties, the rules stipulate that the Compliance Committee must discuss adherence to the laws, regulations, etc., and whether there are any other compliance-related issues and approve the transaction in advance.
The committee’s members include one external expert such as an attorney, and the agreement of this expert is required in order for the committee to approve a transaction.
JEAM has created a system in which the external expert is granted strong authority to ensure checks work well.
Clarification of Fees, Etc.
JEAM provides information that lets unitholders know the details of the fees, etc., paid by JEI.
Among these, asset management fees paid by JEI to JEAM consequently linking to unitholders’ interests.
The method of calculating these asset management fees and the payment schedule are stipulated in JEI’s by-laws and disclosed on JEI’s website.
Moreover, the asset management fees paid to JEAM by JEI each accounting period are published in the asset management report sent to all unitholders at the end of each quarter. This may also be viewed on JEI’s website.
Making Key Information Easy to Understand
JEAM discloses accurate, unbiased key information about itself and JEI to customers in a timely and easy-to-understand manner.
In addition to statutory disclosure and timely disclosure, JEAM voluntarily discloses information that is considered important or useful for customers.
It also strives to disclose easy-to-understand, customer-oriented information by posting a wide range of information, including management policies and the status of finances and owned properties, etc., on JEI’s website in a timely manner.
Providing Appropriate Services to Customers
JEAM strives to understand the needs of all unitholders and manage assets with their needs in mind.
It aims to ensure stable profits and consistent growth of managed assets over the medium to long term while giving practical consideration to environment, society, and governance (ESG) in asset management.
Providing an Appropriate Motivational Framework for Employees
In pursuing the best interests of its customers, JEAM has developed an appropriate governance structure and a motivational framework for employees for the purpose of managing conflicts of interest in a suitable manner.
JEAM has created a code of conduct to ensure that directors and employees always pursue customers’ best interests, and as an asset management specialist, it strives to conscientiously perform its duties and ensure their optimal execution for the benefit of investors.
Compliance and adherence to the code of conduct is one of the items considered in employees’ performance appraisals. Furthermore, compliance-related training for directors and employees is periodically conducted to further raise awareness of compliance.
JEAM has also established a governance structure for the decision-making process for designated transactions involving JEI and sponsor-related companies, which includes discussion of any legal compliance-related issues such as conflicts of interest by the Compliance Committee, whose members include an external expert.