"Our Commitment to Fiduciary Duties"
and "Our Fiduciary Action Plans"

<Our Commitment to Fiduciary Duties>
We Commit Ourselves to be "The Responsible Total Investment Services Provider"

In August 2015, Sumitomo Mitsui Asset Management Company, Limited formulated and announced "Our Commitment to Fiduciary Duties" and its specific measures as "Our Fiduciary Action Plans".
In "Our Commitment to Fiduciary Duties", we have expressed our determination and attitude toward a wide scope of clients; those who start building wealth, who already have investment experience, pensions, institutional investors and corporations, to be entrusted with their money.
Specifically, following "Principle First, Profit Later" of "SMAM Spirit", all SMAM staff will be committed to "provide total investment services in a responsible manner", when managing the funds. To carry out our responsibilities in every aspect of business, we hereby present detailed policies to meet our clients' needs at the highest possible standards.
To materialize our commitment, specific measures are formulated into "Our Fiduciary Action Plans". The details of “Our Fiduciary Action Plans” are posted below in order of item number of the "Principles Concerning Customer-Oriented Business Conduct" by Finanial Services Agency. The “Common” business practices in the asset management industry shall be reviewed on a zero-base, from the customers' point of view. The progress of our action plan will be announced every six months on our website. The clients' opinions and assessments on our actions will help us to continue self-innovation.
SMAM will continue to reform itself in the asset management industry by carrying out its responsibilities as a responsible asset manager, to contribute to the economic growth by supplying proper risk money and steadily building clients' wealth.

We Commit Ourselves to be
"The Responsible Total Investment Services Provider"

Sumitomo Mitsui Asset Management, as an Asset Manager entrusted with our Clients' funds, will provide total investment services in a responsible, devoted and earnest manner.
This is our "Fiduciary Duty".
To achieve this goal, we will put our clients first and work on policies and projects in the areas listed below. For more detailed information, please have a look at our "Our Fiduciary Action Plans".

Investments

Contribute to building clients' wealth with advanced investment techniques
Invest clients' assets according to the clients' needs
Explain investment objectives and situations concisely
Become the top global asset manager in Asian Investment including Japan
Become the top runner in Japan in the SRI and ESG fields (*)

Product Development

Constantly provide high-quality products that meet global standards
Develop products which properly match the clients' needs
Set fees that are rational and that clients are comfortable with

Client Services

Provide earnest services to build long-term relationships with clients
Provide accurate and useful information and means to build clients' wealth
Never provide unsuitable products to clients
Prioritize helping clients understand our products easily

Management Infrastructure

Ensure transparency at all levels of management
Achieve global standards in human resources, systems and governance
Become No.1 in quality by improving operations
Always strive for improvement in productivity

* SRI: Socially responsible investment, ESG: Environmental, Social, Governance

Our Fiduciary Action Plans (OFAPs)
（As of November 29th 2018）

17 OFAPs related to FSA's Principle 2 requiring Pursuit of Customer's Best Interests

Action Plan	Category/Status
① Build up investment methodology and system equipped with excellent traceability that suits long-term investment horizon, and conduct a thorough quality control of products	Investments
	By March 2019
② Build a proprietary “smart data base” which enhances research and investment operation	Investments
	In Progress
③ Offer the top quality Asian investment products with a combination of in-house investment capability and external partners’ capability	Investments
	In Progress
④ Utilize the capabilities of Japanese equity investment in Asian equity investment such as research and investment method （Newly added）	Investments
	Through FY 2018
⑤ Enhance both quality and quantity in outputs of various investment analysis by theme for a long-term horizon	Investments
	In Progress
⑥ Promote engagement activity with investee company that helps improve the company’s enterprise value, and establish our own engagement investment method	Investments
	In Progress
⑦ Position ESG assessment as the base of company analysis from the long-term point of view, and engage in the ESG investment proactively	Investments
	In Progress
⑧ Promote infrastructure investments proactively that contribute to social sustainability	Investments
	In Progress
⑨ Materialize the long-term investment method and start marketing new product that lead to higher customers’ satisfaction than bank deposits	Investments
	Through FY 2018
⑩ Develop the next-generation quantitative investment by utilizing smart database in order to provide new solution for investors under low-interest environment	Investments
	Through FY 2018
⑪ Develop a new fund actively by seed funding	Investments
⑪ Develop a new fund actively by seed funding	In Progress
⑫ Reduce transaction costs with trading functions upgraded by introducing advanced trade execution technology	Investments
	In Progress
⑬ Develop and market “Products leading to higher customers’ satisfaction than bank deposits” in order to support their QOL※ with a view to super-aging society that people live 100 years ※Quality of Life and work which enriches life span	Product Development
	In Progress
⑭ Develop new products for Asian Regional Funds Passport	Product Development
⑭ Develop new products for Asian Regional Funds Passport	In Progress
⑮ Engage in advanced and new ground investment product development by working closely with Nikko Global Wrap Inc.	Product Development
	In Progress
⑯ Adapting to digital disruption, promote system development that contributes to utilization of smart data as well as companywide productivity improvement	Management Infrastructure
	In Progress
⑰ Undertake industry-university joint research for advanced field aiming at sophisticating investment methods to seek practical use of technology such as big data analysis	Management Infrastructure
	In Progress

4 OFAPs related to FSA’s Principle 3 requiring Appropriate Management of Conflicts of Interest

Action Plan	Category/Status
① Continue to disclose individual voting results of Japanese equities as well as self-evaluate on the execution of the Japanese version of stewardship code	Investments
	In Progress
② Strengthen the management and process checking of customer services on a daily basis	Clients Services
	In Progress
③ Hold an independent third-party committee every quarter to check the level and progress of fiduciary duties (e.g. managing conflicts of interest), and execute FD2.0* with suggestions by the external members of the committee *FD2.0 is a new stage of fiduciary duties which SMAM embark on	Management Infrastructure
	In Progress
④ Secure the independence of external board members, and clarify election standards and processes of the CEO and the executive officers	Management Infrastructure
	In Progress

2 OFAPs related FSA’s Principle 4 requiring Clarification of Fees and Expenses

Action Plan	Category/Status
① Based on the “Basic Policy on Management Fees”, set management fee level that is reasonable and acceptable for customers	Product Development
	In Progress
② Increase disclosure level of products’ net return after costs (net of fees, etc.) for customers’ better understanding	Clients Services
	In Progress

3 OFAPs related FSA’s Principle 5　requiring Easily Understandable Provision of Important Information

Action Plan	Category/Status
① Expand digital support line-up to customers such as digital contents and web seminars	Clients Services
	In Progress
② Expand educational activities for entry level customers to have better understanding and more knowledge on investments and wealth creation, through our QOL seminars and SNS	Clients Services
	In Progress
③ Develop web contents that help customer easily understand how investment trusts are formulated such as in the case of Family Fund and Fund of Funds by utilizing infographic technics	Clients Services
	Completed

6 OFAPs related to FSA’s Principle 6　requiring Provision of Services Suited to Each Customer

Action Plan	Category/Status
① Based on the "Basic Policy on Product Strategy", enhance the product development process which lives up to customer needs accurately	Product Development
	In Progress
② Enhance various services for customers to build a portfolio and to benefit from investment profit and risk management	Clients Services
	In Progress
③ Expand the product line-up of publicly offered investment trusts for the direct sales through the internet	Clients Services
	In Progress
④ Expand products for long-term asset formation through DC, iDeCo, monthly investment-type NISA, etc.	Clients Services
	In Progress
⑤ Listen directly to the customers’ voices and continue to improve services	Clients Services
	In Progress
⑥ Develop the system targeting at providing an easier to understand information, enabling the investment proposal to fit customers’ needs, by utilizing BlackRock Aladdin system	Management Infrastructure
	In Progress

3 OFAPs related to FSA’s Principle 7　requiring Frameworks for Motivating Employees Appropriately and Other Measures

Action Plan	Category/Status
① Discuss detail of drastic reform in personnel system focusing on diversity and inclusion concept	Management Infrastructure
	Through FY 2018
② Start creating an office environment which brings up staff's creativity and enhances productivity	Management Infrastructure
	In Progress
③ Review every operation and operational flow aiming at higher productivity as well as the highest level of an internal control which staffs can practice their own Fiduciary Duties	Management Infrastructure
	Through FY 2018

SMAM Spirit　Course of Action until SMAM Achieves Status as No. 1 in Japan in 2020

Principle First, Profit Later	As a social institution, our top priorities are our social contribution and the interests of our customers
Originality & Ingenuity	As a trendsetter in the industry, we actively take on challenges never attempted by others We aspire to create what is novel and unique
Initiative & Daring	Whatever the task, we tackle it with initiative and produce results
Determination & High Aspirations	Once we take on a challenge, we pursue it with determination to completion
United as One	With a spirit of loyalty to the company and company-wide perspective, all executives and employees will unite and make a concerted effort to work toward our goal