Governance Initiatives
Tosei Reit’s Investment Management System
Tosei Reit has no less than one executive officer and no less than two supervisory officers (the number of executive officers plus one or more).
In addition to the General Meeting of Unitholders, which is composed of unitholders, Tosei Reit is composed of one Executive Officer, two Supervisory Officers, the Board of Directors, which is composed of Executive Officers and Supervisory Officers, and Accounting Auditors.
For details, see below and the most recent securities report.
Asset management of assets held by Tosei Reit shall be conducted by Tosei Asset Advisors Co., Ltd. as the asset management company (“Asset Management Company”) based on the Articles of Incorporation of Tosei Reit and in accordance with the asset management entrustment agreement.
For details, see below and the most recently published Report on the Issuer Management System of Real Estate Investment Trust Securities.
Organizational structure for business operations of the Asset Management Company
Compliance Initiatives
Basic Policy
The Asset Management Company fully recognizes that incomplete compliance could undermine its management foundation and has positioned strict compliance as a fundamental principle of management.
As a company engaged in the trading of financial instruments, the Asset Management Company strives to increase the value of its business, which is socially demanded, and aims to broadly obtain trust from society by actively and constantly addressing compliance issues.
Tosei Group specifies the basic corporate ethics and compliance-related matters with which each officer and employee of the Group should comply in the Tosei Group Ethics Code. See below with regard to the Ethics Code and initiatives to prevent corruption, etc.
Establishment of Risk & Compliance Committee
The Risk & Compliance Committee, chaired by the head of the Risk & Compliance Office, deliberates on and approves general compliance-related matters, and deliberates on matters that have been approved by the Board of Directors or the Investment Management Committee.
In principle, the committee meets once a month if at least three-quarters of all members with voting rights, including the head of the Risk & Compliance Office and at least one outside committee member, are present. The committee’s approval of matters under discussion is based on the unanimous agreement (consensus) of all members with voting rights in attendance.
At least one of the committee members is an appointed outside committee member.
Compliance Training
The Asset Management Company conducts training for new employees when they join the company and compliance training for all employees (including temporary staff) for the purpose of promoting compliance.
| Training Details | Time of Training |
|---|---|
| Training on prevention of insider trading | Oct. 2025 |
| Training on anti-social forces | Apr. 2025 |
| Training on prevention of transfer of criminal proceeds | Jan. 2025 |
| Training on prevention of harassment | Sep. 2025 |
| Training on information management | Mar. 2025 |
| Training to provide knowledge about laws such as the Financial Instruments and Exchange Act | Jun. 2025 |
| Training on conflict-of-interest management | Jun. 2025 |
| ESG training | Nov. 2025 |
Ensuring an Investment Management System That Considers Unitholders’ Interests
Decision-making process
The Asset Management Company, apart from Tosei Reit, is also entrusted with the management of private placement funds at its Private Fund Management Division. Accordingly, in order to avoid conflicts of interest between Tosei Reit and the said private placement funds, final decision-making in each decision-making process shall be made not by the Board of Directors of the Asset Management Company but by the investment management committee of each division.
Accordingly, the Investment Management Committee of the REIT Division makes final decisions regarding Tosei Reit.
Management fee structure to ensure avoidance of competition with the Tosei Group
In addition to the following management fee structure, the Asset Management Company has introduced incentive bonuses that are partially linked to distributions per unit in the remuneration structure for officers and employees.
For details, please refer to the Articles of Incorporation of Tosei Reit.
| Management FeeⅠ | Total assets × Remuneration Rate 0.30％（Upper Limit 0.60％）× Actual number of days in the compensation calculation period／365 |
|---|---|
| Management Fee Ⅱ | Net Income × Remuneration Rate 5.00％（Upper Limit 6.00％） |
| Acquisition Fee | Acquisition price × Remuneration Rate （Upper Limit 1.00％ However, 0.50% when acquired from stakeholders） |
| Transfer Fee | Transfer price × Remuneration Rate （Upper Limit 1.00％ However, if transferred to a stakeholder, 0.50%） |
| Merger Fee | Valuation × Remuneration Rate Upper Limit 1.00％ However, in the event that an investment corporation or stakeholder falling under the category of stakeholder merges with an investment corporation entrusted with the management of their assets, the compensation rate is 0.50%） |
Sponsor investment in same boats
Tosei Reit carries out same-boat investment from Tosei Corporation in order to share the interests of the unitholders of Tosei Reit and the Tosei Group and to enhance the effectiveness of sponsor support.
Introduction of accumulated investment unit system
The accumulated investment unit system has been introduced with the aim of raising awareness among officers and employees of the Tosei Group toward improving the business of Tosei Reit, thereby contributing to the continuous growth of Tosei Reit and the improvement of mid- to long-term unitholder value.
The most recent publicly available materials such as the annual securities report can be found here.