Fiduciary Declaration

Policy For Implementing ‘Customer-Oriented’ Business Operations

Introduction

Rheos Capital Works Inc. (hereinafter, “the Company,” or “We”) is an independent investment management firm established in 2003 with the philosophy “To have a positive impact on society as a responsible participant of capital markets.”

In the ever-changing financial market, we have been investing in companies that intend to grow by adapting themselves to the changing social needs and that have a unique strength to achieve stable growth under any circumstances.

In Japan, it seems that a number of people think investment is a bad thing and we cannot see decent progress in “shifting from savings to investment” promoted by the government. As a result, there have been no big changes in people’s savings-biased attitude for personal financial assets. We have been actively promoting financial education and learning to university/college students, school teachers as well as to the public in order to diffuse correct knowledge about investment as we have committed to our philosophy of “To have a positive impact on society as a responsible participant of capital markets” since our company was established.

Our fund management efforts are not simply a matter of helping clients realize their financial goals; we are committed to achieving our clients’ overall satisfaction and ensuring that they are ‘happy to be a fund holder.’ To that end, we proactively disclose information and frequently provide enjoyable activities for retail clients.

We do our utmost to ‘invigorate and energize Japan from its foundation’ by investing the funds our clients have entrusted to us in growth companies and solid companies with strong growth potential, both in Japan and abroad.

We are committed to ensuring the long-term satisfaction of our clients through dedication in investing the funds our clients have entrusted to us for superior long-term performance, impeccable operations, and effective open communication with clients. Therefore, we believe the continuous company-wide efforts to improve on these client values are very much at the core of our ‘Customer-Oriented Business Operations.’ Naturally, client value improvement efforts include sincere client communication with regards to the explanation of our fees and compensation commensurate with our services.

These principles provided below are the basic policies of our activities as they self-evidently follow our philosophy “To have a positive impact on society as a responsible participant of capital markets.” As always, we will continue to conduct ‘Customer-Oriented Business Operations.’

Pursuing the best interest of our clients

The Company’s philosophy “To have a positive impact on society as a responsible participant of capital markets” is reflected in all the Company’s business decisions as well as in the hiring, training, and rewarding of our associates. In this context, “society” encompasses the companies that we invest in and the capital markets, as well as Japanese people in general; but we especially place importance on positively impacting our clients. As such, we believe it is imperative that all personnel of the Company have the necessary high level of expertise, professional ethics, and strong sense of duty.

Appropriately managing conflicts of interest

As an independent investment management firm, we are structurally in a position that is mostly free of potential influence such as from sales firms with which we have capital relations. We strictly adhere to internal regulations and controls to appropriately manage any transactions which may potentially be of conflict of interest so that our clients’ interests will not be unduly harmed.

Making fees clear to clients

As highly experienced investment professionals, we at the Company pursue the best results for our clients by demonstrating an exceptional level of expertise for which we receive appropriate fees. The validity of our fees is routinely monitored by a Fiduciary Duty Committee (hereinafter, “FD Committee”), where the majority of the members are outside experts.

Providing important information in ways that are easy to understand

We provide clients with important information concerning, among others, sales of financial products and services, by engaging in dialogue with them on a regular basis or by other means, such as delivering Investment Reports. Moreover, we cautiously evaluate sales partner financial institutions when distributing our products. We carefully consider the status of compliance with regards to strict examinations of suitability concerning a customer's financial means and the contents of transactions, understanding and the sense of resonance toward the investment philosophy that we advocate, commitment to promoting long-term regular investment, and so forth. Furthermore, we conduct follow-up interviews with each financial institution concerning the status of client service and its considerations. Additionally, these policies and operating processes are regularly monitored by the FD Committee.

Providing services suitable to the client

For our philosophy “To have a positive impact on society as a responsible participant of capital markets,” to become reality, we not only advocate the benefits of long-term investment, but we also convey the appeal and enjoyment of investing. Rather than blindly push new products, we take tremendous care in considering what kind of product is worthwhile to the client and refining the product so that it is appreciated year after year. The process of creating a new product is regularly monitored by the FD Committee to check for appropriateness and adherence of the product to this principle.

Frameworks for appropriately motivating our associates

We will earnestly work to be an investment management firm where all personnel vigorously act in the best interest of our clients with a deep and profound understanding of our philosophy “To have a positive impact on society as a responsible participant of capital markets.” To conduct ‘Customer-Oriented Business Operations’ we will hire, train, and reward people with the highest level of expertise and professional ethics.

The FD Committee will routinely monitor our business operations to assure adherence with these policies. Additionally, the board of directors take responsibility such that the overall business operation is ‘Customer-Oriented.’