These documents have been translated from Japanese originals for reference purposes only.
In the event of any discrepancy between these translated documents and the Japanese originals, the originals
shall prevail. The Company assumes no responsibility for this translation or for direct, indirect or any otherforms of damages arising from the translations.

(Securities Code 7012)
June 5, 2012
Dear Shareholders
Satoshi Hasegawa
President
Kawasaki Heavy Industries, Ltd.
1-1 Higashikawasaki-cho 3chome,
Chuo-ku, Kobe
(Registered Office)
1-3 Higashikawasaki-cho 1chome,
Chuo-ku, Kobe

NOTICE OF
THE 189TH ORDINARY GENERAL MEETING OF SHAREHOLDERS
You are cordially invited to attend the 189th Ordinary General Meeting of Shareholders of Kawasaki Heavy
Industries, Ltd. (“the Company” or “KHI”). The meeting will be held for the purposes as described below.
If you are unable to attend on the day of the meeting we kindly ask you to review the “Reference
Documents for the General Meeting of Shareholders” (described hereinafter), and exercise your voting
right in writing or electronically (via the Internet, etc.) by 5:00 p.m. on June 26, 2012.
Exercise of Voting Rights in Writing
Please indicate your vote for or against the proposals on the enclosed Voting Rights Exercise Form, andreturn it so that it is delivered by the above-mentioned exercise date.
Exercise of Voting Rights via the Internet
Please exercise your voting right by logging on to the Internet website (http://www.web54.net) and entering
the voting right exercise code and password stated on the enclosed Voting Rights Exercise Form, and follow
the online instructions to submit your vote.
1. Date and Time:

Wednesday, June 27, 2012 at 10:00 a.m. (Door opens at 9 a.m.)

2. Place:

Kokusai Hall at The Kobe International House, located at
1-6, Gokoudori 8-chome, Chuo-ku, Kobe

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3. Meeting Agenda:
1.
Matters to bereported:

The Business Report, Consolidated Financial Statements for the Company’s 189th
Fiscal Year (April 1, 2011 - March 31, 2012) and results of audits by the
Accounting Auditor and the Board of Corporate Auditors of the Consolidated
Financial Statements
2. Non-Consolidated Financial Statements for the Company’s 189th Fiscal Year
(April 1, 2011 - March 31, 2012)
Proposal No. 1: Appropriation of Retained Earnings
Proposal No. 2: Partial Amendments to the Articles of Incorporation
Proposal No. 3: Election of Thirteen Directors
Proposal No. 4: Election of One Corporate Auditor
Proposal No. 5: Revision of Amount of Compensation Payable to Directors(Please refer to the “Reference Documents for the General Meeting of Shareholders” hereinafter for
information on each of the proposals.)

4. Other decisions regarding the General Meeting of Shareholders:(1) When voting rights have been exercised twice in writing or electronically, the latter vote received shallbe deemed valid, however when votes are received on the same day, the voting right exercised
electronically shall be deemed valid.
Shareholders who intend to diversely exercise voting rights are requested to give written notification tothat effect, and the reason(s) thereof, no later than three (3) days prior to the day of the General
Meeting of Shareholders.
(2) Because the “Notes to the Consolidated Financial Statements” and “Notes to the Non-consolidated
Financial Statements” among the documents to be submitted when sending the Notice are posted on
our Website (http://www.khi.co.jp/english/ir/) according to laws and the Article 16 of the Articles ofIncorporation, they are not included in the Appendix regarding matters to be reported. In addition, the“Notes to the Consolidated Financial Statements” and “Notes to the Non-consolidated Financial
Statements” have been combined with the Consolidated Financial Statements and theNon-Consolidated Financial Statements for the auditing process, in order for the preparation of theresults of audits by the Accounting Auditor and the Board of Corporate Auditors.

Notes:
1. When attending the meeting, please submit the enclosed Voting Rights Exercise Form at the reception
desk at the venue on the day of the meeting. Please note that persons other than shareholders who are able
to exercise voting rights, including representatives and their companions who are not shareholders, are notpermitted to enter the venue.
In order to save resources, please bring this Notice with you to the Meeting.
2. Any updates to the Appendix and the Reference Documents for the General Meeting of Shareholders, will
be posted on the Company’s Website at the following URL: (http://www.khi.co.jp/english/ir/).

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(Appendix)

Business Report(April 1, 2011 - March 31, 2012)

1. Overview of the Company Group(1)

Business Progress and Results(i) General Conditions
During the current consolidated fiscal year, the Japanese economy started showing signs of gradual
recovery, though there was a concern of economic slowdown due to the impact of the 2011 Thailand
Floods as well as the disruption of the supply chain caused by the Great East Japan Earthquake and thecontinued historic appreciation of the yen. As the post-earthquake reconstruction will boost future
demand and concerns about the concept future energy are growing, the social role of KHI Group, whichis engaged in the development of various key infrastructures, is becoming more significant.
With respect to the global economy, while employment conditions in the U.S. were gradually
improving, the protracted issue of debtor nations in Europe persisted as a cause for concern. In the midstof such circumstances, China has slowed somewhat and yet still maintained its high growth rate.
Emerging countries, including Asian nations and Brazil, also showed steady demand for infrastructure.
Driven by these nations, the global economy was on a track for a modest growth overall. At the sametime, the growth of emerging countries particularly has posed an urgent issue in terms of energy, water
and waste disposal, leading to the global expansion of the business areas in which KHI Group can givecontributions.
Amid this operating environment, the operations of KHI Group’s business segments achieved an
overall increase in both revenue and profit compared to the previous fiscal year, except for somebusiness segments which marked revenue or profit decreases. A decrease in orders in the Rolling Stocksegment, the Ship & Offshore Structure segment and the Plant & Infrastructure segment were made up
for by an increase in the Aerospace segment, the Gas Turbine & Machinery segment and the Precision
Machinery segment, resulting in overall orders received amounting to ¥1,311.8 billion, 3% higher thanthe previous fiscal year.
Net sales were ¥1,303.7 billion, 6% higher than the previous fiscal year. That is because a decreasein the Gas Turbine & Machinery segment and the Ship & Offshore Structure segment was made up forby revenue increases in the Precision Machinery segment, the Plant & Infrastructure segment and the
Aerospace segment.
In terms of profit, although the Rolling Stock segment and the Gas Turbine & Machinery segment
reported decreased profit, increased profits and improvement in performance of the Plant &Infrastructure segment and the Ship & Offshore Structure segment contributed greatly to overall profit,
resulting in operating income of ¥57.4 billion, 35% higher than the previous fiscal year. Recurring
profit was ¥63.6 billion, 29% higher than the previous fiscal year.
However, the reversal of deferred tax asset brought about by the amendment of the taxation system
resulted in current net income of ¥23.3 billion, 10% lower than the previous fiscal year.
(ii) Operating conditions by business segment
The Ship & Offshore Structure segment orders received were ¥39.9 billion, which wassignificantly lower than the previous fiscal year, in spite of orders for eight bulk carriers and others.
Net sales were ¥113.5 billion, which was lower than the previous fiscal year, in which sales of large
vessels were recorded.
Operating income was ¥3.9 billion, which significantly improved from the previous fiscal year inwhich a loss was posted, due to a decrease in the provision for losses on construction contracts.
The Rolling Stock segment orders received were ¥66.0 billion, which was significantly lower thanthe previous fiscal year. This is mainly attributable to large-scale orders received in the previous fiscal
year and deferrals of orders expected in this fiscal year.
Despite decreased sales of rolling stock to the Japanese market, net sales were ¥132.6 billion, which
was higher than the previous fiscal year, due to increased sales of rolling stock to overseas markets.
Operating income declined ¥3.0 billion from the previous fiscal year to ¥5.1 billion, due to theeffects of the strong yen and the provision for losses on construction contracts.
The Aerospace segment orders received were ¥327.2 billion, which was significantly higher than

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the previous fiscal year, due to an increase in orders received from Japan’s Ministry of Defense (MOD).
Net sales were ¥206.5 billion, an increase from the previous fiscal year, due in part to an increase insales to The Boeing Company for component parts for the Boeing 777 and Boeing 787 aircrafts.
Operating income increased ¥4.7 billion from the previous fiscal year to ¥7.8 billion, due in part toincreased sales and cost reduction.
The Gas Turbine & Machinery segment orders received were ¥227.2 billion, which wassignificantly higher than the previous fiscal year, due in part to an increase in orders for component
parts of commercial aircraft jet engines and an order for construction of Kawasaki Green Gas
Engine-equipped power plants.
Net sales were ¥194.6 billion, which was lower than the previous fiscal year, due to a decrease insales of such items as marine diesel engines and gas compression modules.
Operating income decreased ¥1.7 billion from the previous fiscal year to ¥7.7 billion, due in part todecreased sales.
The Plant & Infrastructure segment orders received were ¥119.2 billion, which was lower thanthe previous fiscal year, despite orders for municipal refuse incineration plants for domestic customers
and other projects.
Net sales were ¥122.8 billion, which was significantly higher than the previous fiscal year, due inpart to increased sales of plants to overseas customers.
Operating income increased ¥5.8 billion from the previous fiscal year to ¥14.1 billion, due in part toincreased sales.
Despite a decrease in sales of motorcycles to developed countries because of the effects of thestrong yen, net sales of the Motorcycle & Engine segment were ¥235.2 billion, which was higher thanthe previous fiscal year, due in part to increased sales of motorcycles in emerging countries.
Although the deterioration caused by the 2011 Thailand Floods and the effects of the strong yen
were made up for by an increase in sales of motorcycles in emerging countries and a reduction of fixed
expenses, operating loss was ¥2.9 billion, an improvement of ¥2.0 billion from the previous fiscal year.
The Precision Machinery segment orders received were ¥174.5 billion, which was higher than theprevious fiscal year, predominantly due to an increase in orders for hydraulic components for theconstruction machinery market.
Net sales were significantly higher than the previous fiscal year at ¥175.0 billion, due in part to anincrease in sales of hydraulic components for the construction machinery market and painting robots.
Operating income increased ¥4.3 billion from the previous fiscal year to ¥26.6 billion, due in part toincreased sales.
In the Others segment net sales were higher than the previous fiscal year at ¥123.2 billion.
Operating income increased ¥1.2 billion from the previous fiscal year to ¥3.8 billion.
(Orders Received, Net Sales and Operating Income/Loss by Segment)
Orders Received
Segment
Amount

Unit: 100 million yen

Net Sales

Year-on-Year
ChangeAmountOperating Income/Loss

Year-on-Year
ChangeAmountYear-on-Year
ChangeShip & Offshore Structure

399

(390)

1,135

(48)

39

49

Rolling Stock

660(1,210)

1,326

15

51

(30)

Aerospace

3,272

1,205

2,065

97

78

47

Gas Turbine & Machinery

2,272

396

1,946

(80)

77

(17)

Plant & Infrastructure

1,192

(7)

1,228

337

141

58

Motorcycle & Engine

2,352

7

2,352

7

(29)

20

Precision Machinery

1,745

256

1,750

347

266

43

Others

1,222

153

1,232

91

38

12

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(88)

(35)

13,118412

13,037

768

574

148

Eliminations and corporate
Total

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(Notes) 1. Net sales recorded are for sales to external customers.
2. The net sales figure for Motorcycle & Engine segment is also used as the figure for orders received.

(2)

Capital Investments, etc.
In the current consolidated fiscal year, KHI Group’s total amount of capital investment was ¥63.9
billion, predominantly for the renewal of aging equipment and facilities for streamlining production andnecessary facilities to handle new model and products, as well as facilities to increase the production
capacity of the Precision Machinery segment and the Aerospace segment.
Main capital investments completed and/or acquired during the current consolidated fiscal year, andmain capital investments under construction as at the end of the current consolidated fiscal year are
listed below.
(i) Main capital investments completed and/or acquired during the consolidated fiscal year underreview・ Hydraulic components production facilities(Precision Machinery segment)
・ Aircraft production facilities(Aerospace segment)
・ Rolling stock production management systems(Rolling Stock segment)
・ Kobe Works General Office(company-wide)(ii) Main capital investments under construction as at the end of the consolidated fiscal year underreview・ Production facilities for jet engines(Gas Turbine & Machinery segment)・ Assembly Plant, Harima Works(Plant & Infrastructure segment)
・ Renovation of office building, Kobe Works(company-wide)(3)

FinancingFunds of ¥19.9 billion from long-term loans and ¥20.0 billion from domestic unsecured straightbonds and other funds from various sources were raised in the current consolidated fiscal year. The
funds were allocated to such items as redemption of bonds, long-term loan repayments, capital
investments and working capital.

(4)

Assignment of businesses, absorption-type splits and incorporation-type corporate splits
Not applicable.

(5)

Transfer of business from other companies
Not applicable.

(6)

Succession of rights and obligations pertaining to the business of another juridical person, etc.
due to absorption-type merger or absorption-type company split
Not applicable.

(7)

Acquisition or disposal of another company’s stocks or other holdings, or share options, etc.
Not applicable.

(8)

Issues to be addressed
As for the performance of KHI Group for FY2011, the Motorcycle & Engine segment was affected by
the strong yen and the disruption of the supply chain caused by the 2011 Thailand Floods. KHI, however,
was able to attain the target goal for FY2012, the final year of the “MTBP2010” (operating income of¥52.0 billion and recurring profit of ¥56.0 billion) one year earlier. We believe that this is because of all
business segments have steadily built up better earnings, primarily underpinned by enhanced productivity,
wider implementation of measures such as meticulous risk management on large-scale projects, enhanced
a global production structure that encompasses overseas procurement and the expansion of the Precision
Machinery segment against the backdrop of the steady growth of the Chinese economy.
We will continue to work on thoroughly implementing “selectively focusing resources on strategic
businesses,” “emphasizing quality over quantity” and “employing prudent risk management,” steadilysatisfying demand from emerging countries and enhancing measures to respond to exchange
fluctuations in order to reinforce our revenue base. To strengthen our management position, we will
focus on enhancing our financial strength and fixed cost reduction. In particular, we will conduct global

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reviews on production and sales systems of the shipbuilding business and the motorcycle business todeveloped countries, an area which continues to suffer from stagnant markets, and concentrate ourenergies on allocation of management resources on a priority basis from the standpoint of selectively
focusing resources on strategic businesses.
Moreover, due to nationwide concerns of a limited power supply following the Great East Japan
Earthquake, there has been an increasing interest in Japan on in-house and decentralized power
generation as well as renewable energy. In this area, KHI Group offers various products, including theworld highest efficiency Kawasaki Green Gas Engine, a well-proven gas turbine for dual fuel (oil andgas), power generators using wind power, solar power, micro hydro power and biomass, as well as
storage batteries to smooth over the power situation. At the same time, according to demands of society,from here on we are expected to develop these products with systemization and in packages.
In April 2012, we established the Marketing Division in our Head Office. In addition, we will unite
the Plant & Infrastructure section with the new Tokyo Head Office, which will be established in
December through relocation of the current Tokyo Head Office. With this move, we will further
promote the communization of the Group’s intellectual properties and strengthen our system solution
business in the areas of Transportation equipment, Energy & Environmental Engineering and Industrial
Equipment.
The initiatives to be undertaken by each business segment are as follows.
(i)

Ship & Offshore Structure: Expand the segment scale and strengthen the competitiveness of thebusiness in China, strengthen technological development and reform the structure centering on
the “mother factory” system in the domestic segments, and enter into the ocean development field(ii) Rolling Stock: Develop new products and reinforce our project management to respond to
Enhance competitiveness in domestic and overseas markets through highly versatile standard
rolling stock, satisfy demands for railroading and upgrade of rolling stock in North America,and overseas rolling stock system projects, etc.
(iii) Aerospace: Enhance the mass production of the P-1 patrol aircraft and C-2 transport aircraft,further develop the new utility helicopter (UH-X), enhance the mass production of the Boeing
787, and develop derivative products(iv) Gas Turbine & Machinery: Develop the energy solution business, promote the development of
new models, including industrial gas turbines and high-efficiency gas engines, and expand
these models in the overseas markets, and promote the development of new models of jet
engines for commercial aircraft and improve the productivity of these models(v) Plant & Infrastructure: Bolster research and development in order to expand in the Energy &Environmental Engineering business sector, accelerate efforts to commercialize new products
and new businesses, and expand the infrastructure business mainly for resource-rich countries(vi) Motorcycle & Engine: Enhance cost competitiveness through optimized production andexpansion of overseas procurement on a global basis, expand sales channels and develop newmarkets in emerging countries we have already entered (Southeast Asia and Brazil, etc.), anddevelop leading technologies to respond to environmental requirements(vii) Precision Machinery: Strengthen the global production system of hydraulic equipment for
construction machinery, establish distinctive production technology through the introduction ofmass robots, enhance cost competitiveness in the robot business, and develop technologies toexpand the appropriate fields(viii)Others: Improve development and sales capabilities with respect to the construction machinery
business unit by deepening our alliance with Hitachi Construction Machinery Co., Ltd. andenhance profitability by lowering break-even points
Needless to say, compliance is a fundamental premise in carrying out business activities such as thoseabove. KHI Group places an emphasis on enhancing the monitoring functions of management,
including the selection of directors who do not have roles in the executions of operations, theappointment of outside corporate auditors with no business relationships or other vested interests in the
Company, and the election of corporate auditors who have substantial knowledge about finance andaccounting. Furthermore, KHI Group strives to ensure that employees are made thoroughly aware of theprovisions of the various laws and regulations which apply to them, by implementing such measures asestablishing internal regulations concerning corporate ethics, carrying out staff training for each positionlevel, distributing compliance guidebooks, and setting up CSR committees in each organization.
Furthermore, we have continued to take thoroughgoing organizational compliance initiatives by setting
up a department which presides over internal controls, compliance, and CSR promotion, and creating

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units in charge of compliance within each business unit, while also striving to create a corporate culturethat places the highest priority at all times on information disclosure and transparency.
(9) Trends in Assets and Income(i) Company Group Assets and Income
Unit: 100 million yen
The 186th fiscal
year

The 187th fiscal
year

The 188th fiscal
year

The 189th fiscal year
(under review)

Orders received

15,405

10,012

12,706

13,118Net sales

13,385

11,734

12,26913,037

Recurring profit

387

142

491

636

Net income (loss)

117

(108)

259

233

Net income (loss) per share (yen)¥7.02(¥6.51)¥15.55¥13.95

Total assets

13,997

13,524

13,542

13,621

Net assets

2,952

2,830

2,974

3,159

The 186th fiscal
year

The 187th fiscal
year

The 188th fiscal
year

The 189th fiscal year
(under review)

Orders received

10,545

5,786

8,160

10,181

Net sales

7,714

6,441

8,174

10,033Item(ii) Company Assets and Income
Unit: 100 million yen
Item

Recurring profit

26

86

328

380

Net income (loss)

(61)

(54)

333

114

Net income (loss) per share (yen)(¥3.66)(¥3.24)¥19.97¥6.87

Total assets

9,779

9,764

11,16011,446

Net assets

2,307

2,207

2,468

2,550

(10) Major Parent Companies and Subsidiaries(i) Parent Companies
Not applicable.
(ii) Major Subsidiaries

Company name

CapitalThe
Company’s
percentage ofequityparticipation

Main business

Kawasaki Trading Co., Ltd.

¥ 600 million

70%

Sale of various industrial machinery, petroleum,steel, air conditioning equipment, etc.

Kawasaki Machine Systems, Ltd.

¥ 350 million

100%

Sale and repair of gas turbine generators,
industrial robots, and other industrial machinery(Note 2)

¥ 4,825 million

66%

Design, manufacture, sale, repair, etc. of
construction machinery

KCM Corporation

NIPPI Corporation¥ 6,048 million

100%

Manufacture, maintenance, and modification of
aircraft; manufacture of rocket components,
aerospace equipment, targeting systems,
nondestructive testing systems, and industrial
fans

Kawasaki Thermal Engineering Co.,Ltd.

¥ 1,460 million

83%

Manufacture, sales, installation and after-sales
service for boilers, air-conditioning equipment
and absorption-style heat pumps, etc.

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The
Company’s
percentage ofequityparticipation

Main business¥ 1,200 million

100%

Design, execution and supervision ofengineering, construction, installation ofmachinery and appliances; design, manufacture,and sale of crushers, grinders, sorters, and otherequipment

KCMJ Corporation¥ 300 million

Note 3

Sale and repair of construction machinery,
hydraulic components, and other industrial
machinery

Kawasaki Motors Corporation Japan¥ 100 million

100%

Sole distributor of motorcycles and JET SKI® in
Japan

Kawasaki Motors Corp., U.S.A.

U.S.$ 165 million

100%

Sales of motorcycles, 4-wheel buggies, JET
SKI®, general purpose gasoline engines in theU.S.

Kawasaki Motors
Manufacturing Corp., U.S.A.

U.S.$ 120 million

100%

Manufacture of motorcycles, 4-wheel buggies,
JET SKI®, general purpose gasoline engines,
rolling stock, and industrial robots in the U.S.

U.S.$60 million

Note 4

Manufacture, sale and after-sales service forrolling stock and related products, various
engineering services

R$16 million

100%

Manufacture and sale of motorcycles and4-wheel buggies in Brasil£5 million

100%

Manufacture and sale of hydraulic pumps andmotors€64 million

100%

Sole distributorship of motorcycles, 4-wheel
buggies, JET SKI®, general purpose gasoline
engines in Europe

Kawasaki Motors Enterprise(Thailand) Co., Ltd.

1,900 million baht

100%

Manufacture and sale of motorcycles inThailand

P.T. Kawasaki Motor Indonesia

U.S.$ 40 million

83%

Manufacture and sale of motorcycles inIndonesia

Kawasaki Motors (Phils.) Corporation

101 million peso

50%

Manufacture and sale of motorcycles in thePhilippines

Kawasaki Precision Machinery
Trading (Shanghai) Co., Ltd.

¥ 400 million

100%

Customer service, sales and CS activities
relating to precision machinery products in
China

Flutek, Ltd.

1,310 million
won

50%

Assembly and after-sales services for hydraulicequipment in Korea

Company nameEarthTechnica Co., Ltd.

Kawasaki Rail Car, Inc.

Kawasaki Motores do Brasil Ltda.
Kawasaki Precision Machinery (U.K.)
Ltd.
Kawasaki Motors Europe N.V.

Capital(Notes)1.
From this current consolidated fiscal year, the following changes were made in relation to companies classified as major
subsidiaries: Three companies: Kawasaki Motores do Brasil Ltda., Kawasaki Precision Machinery (U.K.) Ltd. and
Kawasaki Precision Machinery Trading (Shanghai) Co., Ltd. were added.
2.
As of April 1, 2012, Kawasaki Machine Systems, Ltd. carried out an absorption-type company split of the department
related to industrial robots with Kawasaki Robot Service, Ltd., KHI’s wholly-owned subsidiary.
3.
KCMJ Corporation is a wholly-owned subsidiary of KCM Corporation.
4.
Kawasaki Rail Car, Inc. is a wholly-owned subsidiary of Kawasaki Motors Manufacturing Corp., U.S.A.

(iii) Progress of Business Combinations
There are 97 consolidated subsidiaries, including 19 companies which are cited in (ii) above as
major subsidiaries, and there are 14 companies which are accounted for using the equity method.
(iv) Results of Business Combinations
As stated above in “Business Progress and Results”, for the current consolidated fiscal year net sales
increased ¥76.8 billion (6%) compared to the previous fiscal year, to ¥1,303.7 billion, and consolidated
current net income was ¥23.3 billion.

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(11) Company Group’s Main Business and Number of Employees
Segment

Main Business

Number of Employees

Ship & Offshore Structure

Manufacture and sale of ships, etc.

2,735

Rolling Stock

Manufacture and sale of rolling stock, and snow removal
machinery, etc.

3,111

Aerospace

Manufacture and sale of aircraft, etc.

5,428

Gas Turbine & Machinery

Manufacture and sale of jet engines, industrial gas
turbines, prime movers, etc.

3,675

Plant & Infrastructure

Manufacture and sale of industrial machinery, boilers,
environmental equipment, steel structures and crushingmachines, etc.

2,913

Motorcycle & Engine

Manufacture and sale of motorcycles, four-wheel buggies(ATVs), multi-purpose four-wheel vehicles, personal
water craft (“JET SKI®”), general purpose gasoline
engines, etc.

8,839

Precision Machinery

Manufacture and sale of hydraulic components andindustrial robots, etc.

2,426

Other

Manufacture and sale of construction machinery,commerce, brokerage and mediation for sale and order
reception and administration of welfare facilities, etc.

3,194

Company-wide common areas(Head Office Administration Department, Research &Development Department, etc.)

946

Total

33,267
Japan
24,770Overseas 8,497-(Note)This company has 14,825 employees (average age: 41.7 years; average years of service: 16.4 years)(12) Company Group’s Principal Offices and Plants(i) The Company
Name and location
Principal
officesHead office

Kobe Head Office, Tokyo Head Office

Branches

Sapporo Office, Sendai Office, Nagoya Office, Osaka Office, Hiroshima Office, Fukuoka
Office, Okinawa Office 7 Offices

Plants, etc.

2 Head Offices

Gifu Works (Kakamigahara), Nagoya Works 1 (Yatomi, Aichi), Nagoya Works 2 (Ama-gun,
Aichi), Kobe Works, Hyogo Works, Seishin Works, Nishi Kobe Works (Kobe), Akashi Works(Akashi), Kakogawa Works (Kakogawa), Harima Works (Kako-gun, Hyogo), Sakaide Works(Sakaide, Kagawa), Tokyo Office (Koto-ku, Tokyo), Technical Institute (Akashi) 13 Works(including a Technical Institute)(ii) Material Subsidiariesi) Domestic
Company nameLocation of principal offices

Location of plants

Kobe, Chiyoda-ku, Tokyo

-

Osaka

-

KCM Corporation

Kako-gun, Hyogo

Kako-gun, Hyogo

NIPPI Corporation

Yokohama

Yokohama, Yamato

Kusatsu, Osaka, Koto-ku, Tokyo

Kusatsu

Chiyoda-ku, Tokyo

YachiyoKakogawa-

Akashi-

Kawasaki Trading Co., Ltd.
Kawasaki Machine Systems, Ltd.

Kawasaki Thermal Engineering Co., Ltd.
EarthTechnica Co., Ltd.
KCMJ Corporation
Kawasaki Motors Corporation Japanii) Overseas

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Company nameLocation

Kawasaki Motors Corp., U.S.A.

U.S.

Kawasaki Motors Manufacturing Corp., U.S.A.

U.S.

Kawasaki Rail Car, Inc.

U.S.

Kawasaki Motores do Brasil Ltda.

BrasilKawasaki Precision Machinery (U.K.) Ltd.

U.K.

Kawasaki Motors Europe N.V.

The Netherlands

Kawasaki Motors Enterprise (Thailand) Co., Ltd.

Thailand

P.T. Kawasaki Motor Indonesia

Indonesia

Kawasaki Motors (Phils.) Corporation

Philippines

Kawasaki Precision Machinery Trading (Shanghai) Co., Ltd.

China

Flutek, Ltd.

Korea

(13) Principal lenders(Unit: 100 million yen)
Balance of Loans

Lenders
Long term

Short term

Total

Mizuho Corporate Bank, Ltd.

139

328

467

Sumitomo Mitsui Banking Corporation

175

148

323

The Sumitomo Trust and Banking Co., Ltd.

170

50

220

Development Bank of Japan Inc.

173

5

179

Nippon Life Insurance Company

40

80

120

(Note) The Sumitomo Trust and Banking Co., Ltd. merged with The Chuo Mitsui Trust and Banking Company, Limited andChuo Mitsui Asset Trust and Banking Company, Limited effective April 1, 2012 and became Sumitomo Mitsui Trust
Bank, Limited. Accordingly, the amount of loans from Sumitomo Mitsui Trust Bank, Limited as of April 1, 2012 is 23.0
billion yen.

(14) Other important issues concerning the current situation of corporate groups
Important law suits cases etc
The Japan Fair Trade Commission issued on June 27, 2006 a cease and desist order against our company on
the grounds that there was illegal conduct (bid rigging) in violation of the Antimonopoly Act in relation to theconstruction of refuse incineration plants ordered by municipal governments etc. We have, however, lodged an
appeal with the Tokyo High Court to seek for the cancellation of the decision. In that appeal, the Tokyo High
Court ruled against our company (i.e. not agreeing to cancel the decision). We therefore appealed to theSupreme Court on October 9, 2008, however, on October 6, 2009, the appeal was declined, which confirms
our company lost the suit.
The Japan Fair Trade Commission issued a surcharge payment order on March 23, 2007 for the amount of¥5,165 million against our company. We have appealed the decision to the Japan Fair Trade Commission anddemanded a trial. However, since the same payment order for the amount of ¥5,165 million was issued in thedecision made on November 10, 2010, we decided not to challenge the decision. We paid the surcharge in fullon January 11, 2011, which closed this case.
Meanwhile, in relation to this matter, law suits have been filed against our company individually orseverally with other companies as follows as of the end of March 2012, in order to seek damages from us on
the grounds that we caused damage to the ordering parties due to bid rigging. Lawsuits settled during FY2011
are also included.
Municipalities, etc.

Status of the law suits

Atami CityThe Supreme Court ruled in favor of our company and others on April 13, 2009 (i.e. declined theappeal of citizens seeking damages of ¥1,357 million against seven companies including ourcompany), which confirmed that our company won the suit. However, an action for damages of ¥512
million has been brought against five companies including our company by Atami City at Tokyo High
Court on August 19, 2010. The case is currently under dispute.

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Amagasaki City
(Civil lawsuits)

Osaka High Court ruled in favor of our company and others on November 30, 2007 (i.e. declined thedemand by citizens for the payment of ¥848 million against the six companies including ourcompany). The citizens’ group appealed to the Supreme Court. The Supreme Court reversed the High
Court decision and sent the case back to Osaka High Court on April 28, 2009. Osaka High Court ruled
against our company and others on July 23, 2010 (i.e. ordered the six companies including ourcompany to pay ¥336 million). Although the six companies, including our company, did not appeal to
the Supreme Court, the citizen’s group did so. The Supreme Court did not accept the appeal from thecitizen’s group on July 7, 2011, which confirmed the above rule of Osaka High Court. The case is now
closed.

Sado City

An action for damages of ¥621 million was brought against our company at Niigata District Court on
May 26, 2009. The District Court ruled against our company and ordered KHI to pay ¥273 million on
October 14, 2011. However, both Sado City and our company filed an appeal. The case is currently
under dispute in Tokyo High Court.

Greater Chichibu
Municipal Association

An action for damages of ¥952 million was brought against five companies including our company atTokyo District Court on June 18, 2009. A settlement was reached between the Greater Chichibu
Municipal Association and all the defendant companies with Hitachi Zosen Corporation, a party
receiving the order, agreeing to pay a settlement in the amount of ¥744 million to the Association. The
case is now closed.

Tama River Health
Association

An action for damages of ¥3,105 million was brought against our company at Tokyo High Court on
June 24, 2010. A settlement was reached on April 5, 2012, with our company agreeing to pay asettlement in the amount of ¥2,550 million to the Tama River Health Association based on advice tosettle issued by Tokyo High Court and the Association agreeing to the condition. The case is now
closed.

Yugawara Town andManazuru Town
Health Association

An action for damages of ¥256 million was brought against our company at Tokyo High Court on
October 31, 2011. The case is currently under dispute.

Sasebo City

An action for damages of ¥463 million was brought against our company at Sasebo Branch of
Nagasaki District Court on November 30, 2011. The case is currently under dispute.

2. Status of Shares (as of March 31, 2012)(1)

Total number of shares authorized to be issued

3,360,000,000 shares(2)

Total number of shares issued

1,671,892,659 shares(including 77,126 shares of treasury stock)(3)

Number of shareholders

153,843 persons(4)

Major shareholders (top 10)
Shareholders’ investment in the company
Shareholder name
Number of shares held
thousand shares

Shareholding ratio%

Japan Trustee Services Bank, Ltd. (Trust Account)

91,310

5.4

The Master Trust Bank of Japan, Ltd. (Trust Account)74,3194.4

Mizuho Bank, Ltd.

57,443

3.4

JFE Steel Corporation

56,174

3.3

Nippon Life Insurance Company

54,016

3.2

Japan Trustee Services Bank, Ltd. (Trust Account 9)40,886

2.4

Kawasaki Heavy Industries, Ltd. Kyoueikai

33,991

2.0

Kawasaki Heavy Industries, Ltd. Employees Shareholder Association

31,939

1.9

SSBT OD05 OMNIBUS ACCOUNT - TREATY CLIENTS

30,703

1.8

Tokio Marine & Nichido Fire Insurance Co., Ltd.

27,8381.6(Note) The shareholding ratio is calculated after subtracting treasury stock (77,126 shares).

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3. Company Share Options(1)

Share options held by company officers at the end of the fiscal year under review
Not applicable.

(2)

Share options delivered to employees, etc. during the fiscal year under review
Not applicable.

(3)

Other important matters concerning share options, etc.
Not applicable.

4. Company Officers(1)

Directors and Corporate Auditors
Name

Areas of Responsibility within the Company and othersignificant concurrent positions

Chairman of the
Board

Tadaharu Ohashi

Chairman, The Kobe Chamber of Commerce and Industry
Vice Chairman, Kansai Economic Federation*

President

Satoshi Hasegawa*

Senior Executive Vice
President

Masashi Segawa

Assistant to the President, in charge of technology, marketing andprocurement, Infrastructure Strategy Office*Senior Vice President

Mitsutoshi Takao

In charge of the Head Office administrative departments*

Senior Vice President

Yuichi Asano

President, Gas Turbine & Machinery Company*

Senior Vice President

Nobumitsu Kambayashi

President, Ship & Offshore Structure Company, Chairman,
Nantong COSCO KHI Ship Engineering Co., Ltd.

*

Senior Vice President

Kyohei Matsuoka

President, Rolling Stock Company*

Senior Vice President

Hiroshi Takata

President, Motorcycle & Engine Company*

Senior Vice President

Shigeru Murayama

President, Aerospace Company*

Senior Vice President

Toshikazu Hayashi

President, Plant & Infrastructure Company*

Senior Vice President

Makoto Sonoda

President, Precision Machinery Company

Corporate Auditor

Nobuyuki Okazaki(Standing)Corporate Auditor

Tatsuyoshi Ogushi(Standing)Corporate Auditor

Kenzo Doi

Attorney, Outside Corporate Auditor of World Co., Ltd.

Corporate Auditor

Michio Oka

Position(Notes) 1. * means a Representative Director.
2. Corporate Auditors Kenzo Doi and Michio Oka are both Outside Corporate Auditors.
3. Corporate Auditor Michio Oka is an Independent Officer. He previously assumed a position as an officer ofKawasaki Kisen Kaisha, Ltd. and its affiliates. KHI, however does not have a capital relationship with
Kawasaki Kisen Kaisha, Ltd.; that is, Kawasaki Kisen is not a company of KHI Group, and the proportionof its sales to KHI’s consolidated sales is minimal. We have determined that the above fact would not cause
any issues as regards independence, and he is therefore suitable as an independent officer.
4. Shuji Mihara, Director, has resigned during the relevant business year with the conclusion of the 188th
Ordinary General Meeting of Shareholders.
5. As of April 1, 2012, the Director positions have changed: Yuichi Asano and Toshikazu Hayashi, formerly
Senior Vice Presidents (Representative Directors), have become Directors, and Mitsutoshi Takao, formerlya Senior Vice President (Representative Director), has become Senior Executive Vice President(Representative Director).
6. Nobuyuki Okazaki, Corporate Auditor, who has many years of experience with administration andaccounting operations at our company and its subsidiaries, has substantial knowledge about finance andaccounting matters.
7. Executive Officers as of April 1, 2012 are as follows.
Position
President

Name

Areas of Responsibility within the Company

Satoshi Hasegawa

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Position

Name

Areas of Responsibility within the Company

Senior Executive Vice President

Masashi Segawa

Assistant to the President, in charge of Marketing Division,
Procurement Division and Corporate Technology Division

Senior Executive Vice President

Mitsutoshi Takao

Assistant to the President, in charge of Corporate Planning
Division, Finance & Accounting Division, CSR Division,
Personnel & Labor Administration Division and General
Administration Division

Senior Vice President

Nobumitsu Kambayashi

President, Ship & Offshore Structure Company

Senior Vice President

Kyohei Matsuoka

President, Rolling Stock Company

Senior Vice President

Hiroshi Takata

President, Motorcycle & Engine Company

Senior Vice President

Shigeru Murayama

President, Aerospace Company

Senior Vice President

Makoto Sonoda

President, Precision Machinery Company

Managing Executive Officer

Minoru Makimura

General Manager, Corporate Technology Division and Senior
Manager, Technical InstituteManaging Executive Officer

Masahiko Hirohata

General Manager, Corporate Planning Division

Managing Executive Officer

Yoshinori Kanehana

General Manager, Marketing Division

Managing Executive Officer

Joji Iki

President, Gas Turbine & Machinery Company

Managing Executive Officer

Eiji Inoue

President, Plant & Infrastructure Company

Executive Officer

Takeshi Sugawara

Deputy General Manager, Corporate Technology Division (incharge of Manufacturing Improvement)

Executive Officer

Tamaki Miyatake

General Manager, Planning Division, Motorcycle & Engine
Company

Executive Officer

Shuichi Yamanaka

In charge of special matters, Rolling Stock Company

Executive Officer

Shinsuke Tanaka

Deputy General Manager, Corporate Planning Division. (Incharge of special matters)

Executive Officer

Masatoshi Yamaguchi

In charge of robot business, Precision Machinery Company

Executive Officer

Naomi Sera

Vice President, Aerospace Company

Executive Officer

Yoshizumi Hashimoto

General Manager, CSR Division

Executive Officer

Masahiro Ibi

Executive Officer

Takafumi Shibahara

General Manager, Personnel & Labor Administration Division

Executive Officer

Nobuyoshi Kobayashi

General Manager, Production Center, Plant & Infrastructure
Company, in charge of Chemical Plant & Cryogenic Storage
System Engineering Division, Plant & Infrastructure
Company

Executive Officer

Minoru Akioka

General Manager, Finance & Accounting Division

Executive Officer

Yukinobu Kono

Deputy General Manager, Corporate Technology Division andGeneral Manager, System Technology Development Center

Executive Officer

Masafumi Nakagawa

General Manager, Marketing & Sales Division, Motorcycle &Engine Company

Executive Officer

Mitsuo Kadoya

General Manager, Project Division Ship & Offshore Structure
Company

Executive Officer

Hiroshi Hidaka

In charge of planning and overseas business, Precision

Vice President, Gas Turbine & Machinery Company
Deputy General Manager, Marketing Division

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Position

Name

Areas of Responsibility within the Company
Machinery Company

Executive Officer

Hideki Sasaki

In charge of Tokyo Office, Plant & Infrastructure Company

Executive Officer

Atsuhiko Yamanaka

General Manager, Procurement Division

Executive Officer

Akio Murakami

General Manager, Planning & Control Division, Ship &Offshore Structure Company

Executive Officer

Kaoru Kawabe

General Manager, Kobe Shipyard, Ship & Offshore Structure
Company

Executive Officer

Kazuo Hida

General Manager, Engineering Division, Precision Machinery
Company

Executive Officer

Makoto Ogawara

Vice President, Rolling Stock Company

Executive Officer

Yugo Nakagami

Overall administration of Marketing & Sales Division, Quality
Assurance Department, Corporate Technology Department
and Project Engineering Center, Plant & Infrastructure
Company

Executive Officer

Hirokazu Komaki

General Manager, Engineering Division, Aerospace Company

Executive Officer

Shiro Nakabayashi

General Manager, General Administration Division

Munenori Ishikawa

General Manager, Manufacturing Division, Aerospace
Company

Toshiyuki Kuyama

General Manager, Gas Turbine Division, Gas Turbine &Machinery Company

Shigehiko Kiyama

General Manager, Supply Chain Division, Motorcycle &Engine Company

Kenji Tomida

Deputy General Manager, Corporate Planning Division, andMarketing Division

Executive Officer
Executive Officer
Executive Officer
Executive Officer(2)Compensation to Directors and Corporate Auditors
Directors 12 persons

Corporate Auditors 4 persons¥ 666,118 thousand¥ 88,080 thousand (of which ¥ 17,280 thousand to two Outside Corporate Auditors)(Notes) The maximum amount of remuneration for the Directors is ¥60 million per month (as resolved at the 178thOrdinary General Meeting of Shareholders held on June 28, 2001). The maximum amount of remuneration for
the Corporate Auditors is ¥8 million (which was resolved at the 170th Ordinary General Meeting of
Shareholders held on June 29, 1993).

(3)

Outside Officers(i) Concurrent Director positions at other companies and the relationship between our company
and said companies
Not applicable.
(ii) Concurrent positions held as Outside Officer at other companies and the relationshipbetween our company and said companies
Corporate Auditor, Kenzo Doi concurrently holds a position as an Outside Corporate Auditor at
World Co., Ltd. Our company does not have any dealings or other special relationship with thiscompany.
(iii) Relationships between the company or specific related business operators and Directors andemployees, etc.
Not applicable.
(iv) Main activities during the business year
Attendance and comments at Board of Directors Meetings and Board of Corporate Auditors
meetings
Kenzo Doi, Corporate Auditor, attended all of the 14 Board of Directors Meetings, and all of the 17
Board of Corporate Auditors meetings held during the business year, and mainly made comments basedon his expert standpoint as an attorney.

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Michio Oka, Corporate Auditor, attended all of the 14 Board of Directors Meetings, and all of the
17 Board of Corporate Auditors meetings held during the business year, and mainly made comments
based on his experience as a company manager.
(v) Overview of provisions in contracts for limitation of liability
The company has concluded contracts for limitation of liability with Corporate Auditors Kenzo Doi
and Michio Oka, pursuant to the provisions of Article 427 Paragraph 1 of Japan’s Companies Act. The
liability under said contract shall be limited to either an amount of ¥ 10 million, or an amount specified
by law, whichever is higher.

5. Accounting Auditors(1)

Accounting Auditor’s Name
KPMG AZSA LLC(2)Accounting Auditors’ Compensation, etc., for the fiscal year under review(i) Accounting Auditors’ Compensation, etc., for the fiscal year under review¥ 161,595 thousand(ii) Cash and Other Profits Payable by the Company or its Subsidiaries to Accounting
Auditors¥ 223,045 thousand(Note) Under the audit agreement between the Company and its Accounting Auditors, compensation for audits
pursuant to the Companies Act and audits pursuant to the Financial Instruments and Exchange Act are notseparated, and otherwise cannot be separated. Consequently, the above amounts reflect totalcompensation.

(3)

Details of Non-audit Services
Operations such as procedures relating to the confirmation of balances of certain accounts issued tocustomers when orders are received for overseas projects and IFRS advisory, etc.

(4)

Policy Regarding Determination of Termination or Nonrenewal of Appointment of
Accounting Auditors
Where the Accounting Auditor violates or contravenes laws such as the Companies Act andCertified Public Accountant Act, and where it is determined acts have been committed which go against
public order and morality, the Board of Corporate Auditors shall consider whether to terminate or not
renew the Accounting Auditors based on those facts, and make a decision in accordance with the Boardof Corporate Auditors Regulations. Where the Board of Corporate Auditors determines that it isappropriate to terminate or not renew the appointment of Accounting Auditors, it will request the Boardof Directors to terminate the Accounting Auditors’ appointment, or put forward a proposal at theGeneral Meeting of Shareholders to not renew the appointment of the Accounting Auditors, and theBoard of Directors shall discuss the matter.

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6. System to ensure that Directors’ execution of duties complies with laws and the
Articles of Incorporation and other systems to ensure proper execution of business
A resolution was made with respect to the company’s internal control systems, pursuant to the Companies
Act, at the Board of Directors Meeting of May 24, 2006 regarding confirmation of the basic policies andstatus of established internal control systems, and henceforth whenever there are organizational changes orchanges to internal regulations, resolutions are made again at Board of Directors Meetings. The overview
thereof is as follows. In addition, KHI conducts year-end assessment of the operation status of resolved
internal control systems to ensure proper operation and provides reports to the Board of Directors.
I. Basic policy for developing a system for internal controls
KHI Group develops and maintains systems for internal controls to establish systems to ensure formationof proper organizational structures, development of company rules and regulations, dissemination of
information and proper execution of operations; since KHI’s management philosophy, which is indicatedin our Group Mission (missions and roles which must be carried out) “Kawasaki, working as one for thegood of the planet” (Enriching lifestyles and helping safeguard the environment: Global Kawasaki),“Kawasaki Value”, the “The Kawasaki Group Management Principles” and “The Kawasaki Group Codeof Conduct”; is embodied in each and every officer and employee of our Group. KHI strives to improve its
internal controls by constantly reviewing them, and in doing so improves the efficiency and lawfulness ofcompany systems which contribute to the Group’s sound and sustained growth.
II. Development of internal control systems
KHI has established the following internal control systems and is streamlining, maintaining, andimproving them. Going forward, KHI will review them as necessary, taking into account such factors aschanges in the company’s operating environment.
1. Internal control systems concerning Directors and employees(1) Systems to ensure that Directors’ and employees’ execution of duties are compliant with laws andthe Articles of Incorporation
1) We established KHI Corporate Ethics Regulations, and are thoroughgoing in ensuring
compliance with laws and the Articles of Incorporation and other KHI regulations and policies,
and bind KHI’s directors and employees to: “put ethics regulations into practice as corporate
citizens”, “respect individuals and individual rights and prohibit discrimination”, “promote
protection of the environment”, “comply with laws and social rules”, and “use proper accounting
practices and ensure reliability of financial reports” (hereinafter, “Fundamental Principles ofCorporate Ethics).
2) According to the Internal Controls Management Regulations, we appropriately manage thesystem to promote measures, with the President as the chief executive of internal controls andGeneral Manager of each division as the manager in charge of internal controls, and deliberate
and make decisions on policies and measures at Management Committee, which are designed to
streamline, maintain, and improve internal control systems, in order to ensure theappropriateness of business operations by achieving objectives such as effective and efficientbusiness operations, reliable financial reporting, compliance with laws, and safeguarding ofassets. Based on the roles and responsibilities given to Executive Officers, officers, andemployees, we manage internal control systems in a unified way.
3) According to the Company-wide CSR Committee Regulations and the CSR Committee Rules
for Business Divisions, we deliberate and make decisions on policies and measures, under thegovernance of the President, for the Company-wide CSR Committee and the CSR Committee
for Business Divisions (consisting of officers and employees) to comply with the Fundamental
Principles of Corporate Ethics stipulated in KHI Corporate Ethics Regulations, and to takethoroughgoing compliance initiatives for the KHI Group. We continue to improve understanding
and awareness of compliance and also monitor operational status through ongoing education andtraining activities for various types of legal compliance.
4) According to the Compliance Reporting and Consultation System Regulations, we work toenhance compliance systems by managing the internal whistleblower system to report
information regarding compliance breaches in cases where it is difficult to correct compliancebreaches through ladders or concerned divisions.

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5) Executive Officers who are delegated to execute business operations are appointed at Board of
Directors Meetings, and while Executive Officers are delegated to execute business operations, a
Director who does not concurrently serve as an Executive Officer and an Independent Officer
established by the Tokyo Stock Exchange are appointed to enhance the supervisory andmonitoring functions of the Board of Directors for overall management.
6) According to the Internal Controls Regulations, we ensure the appropriateness of business
operations through business audits conducted by the Auditing Department.
7) Based on our Basic Policy on Internal Controls over Financial Reporting, we establish internal
controls over financial reporting and appropriately carry out evaluation and assessment thereof
to ensure the reliability of financial reporting.
(2) Systems for storage and management of information related to Directors’ execution of duties
1) Information pertaining to Directors’ execution of duties (meeting minutes, decision making
records and appurtenant materials, account books, account invoices and other information) shallbe appropriately stored and managed in accordance with Document Handling Regulations andother related policies and regulations. The information shall be made accessible at any time to
Directors, Corporate Auditors and employees nominated thereby.
2) With respect to protection of confidential information, we have established a Rules for Handling
Corporate Secrets, and with respect to personal information we have established Regulations forProtecting Personal Information to ensure appropriate handling is thoroughly observed, and we
ensure enforcement thereof through such measures as inspections and business audits, which arecarried out according to methods stipulated in the regulations.
(3) Systems for management of risk of loss
1) According to the Risk Management Regulations, we grasp the assumed risk in detail usinga unit of measurement common to the entire Group, with the President as the chief
executive of risk management and General Manager of each division as manager in chargeof risk management, and appropriately manage the risk management system, which isdesigned to avoid or minimize risk or losses caused by such risk.
2) With respect to risks pertaining to management strategies, risk analysis and considerationof countermeasures shall be conducted in advance by the concerned divisions in accordancewith the Regulations of Board of Directors, the Management Committee Regulations andthe Approval Regulations, and deliberations and decision making regarding those risks
shall be carried out at Board of Directors Meetings or Management Committees inaccordance with those regulations. We also implement appropriate risk management for
major projects that have a significant impact on business operations, in accordance with the
Major Project Risk Management Regulations particularly.
3) As a measure to be taken when risk becomes evident, according to the Crisis Management
Regulations, we articulate codes of conduct in event of emergencies, and also appoint
persons in charge of crisis management at each place of business to appropriately manage
the system, which is designed to minimize losses. In particular, in anticipation of theoccurrence of disasters, including large-scale earthquake and pandemic diseases, we
specify important operations to which priority should be given to ensure the continuation or
recovery of the operations in order to minimize the impact on business and formulate abusiness continuity plan to shorten the length of time until recovery.
(4) Systems to ensure efficient execution of Directors’ duties
1) Based on KHI Group’s role and objectives as articulated in the Kawasaki Group Mission
Statement, we share final goals for the future by setting forth a long-term vision for eachbusiness division in the Medium-Term Business Plan.
2) To attain the goals set forth in the Kawasaki Group Mission Statement and the long-term
vision (“Kawasaki Business Vision 2020”), we have formulated a Medium-Term Business
Plan and a Short-Term Business Plan, and have determined goals at an organization levelbased on these plans. We have also established performance goals for each officer andemployee, and work on activities that articulate goals to be achieved. Furthermore, byconducting regular reviews of these respective plans and goals, we aim to secure a systemthat enables more appropriate and efficient execution of business operations.
3) We have stipulated matters such as division of roles and authority for executing business
operations and lines of responsibility and chains of command, etc., in the Rules for

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Managing Segregation of Business Operations and the Approval Regulations, etc., in orderto clarify the authority and limits of discretion of officers and employees. According to the
Executive Officers Regulations, Executive Officers are appointed based on a resolution
passed at Board of Directors Meetings, and we clarify the “Systems for Execution ofBusiness Operations.” As a result of appropriately managing these systems, we aim to
efficiently execute business operations in each business and function area.
4) We have established Management Committee, which act as a deliberative organ to support
the Board of Directors Meetings’ resolutions and the President’s decision making, to ensure
efficient execution of duties by Board Members through discussions at Management
Committees. Furthermore, we hold Executive Officers Committee for all Executive
Officers to ensure familiarity with and a common understanding of management strategies
and plans.
5) According to the company system, each business division makes decisions on its own
under delegated authority and responsibility, and executes flexible business operations that
adapt to changes in the environment.
2. Internal controls systems in the company group• Systems to ensure proper business execution within the company group which is composed of thecompany and subsidiaries
1) With respect to the management at each company within our Group, while respecting the autonomy
thereof, we ensure the appropriateness of business operations as a whole by KHI and each company
within our Group sharing the basic philosophy and vision indicated in the Kawasaki Group Mission
Statement and the Medium-Term Business Plan, etc.
2) According to the Internal Controls Management Regulations, we govern internal controls of our
subsidiaries and affiliates from the perspective of the parent company and appropriately manage thesystem to ensure the appropriateness of business operations by achieving objectives such as theeffectiveness and efficiency of business operations, reliability of financial reporting, compliance withlaws and safeguarding of assets as a whole group.
3) We implement controls as shareholders of subsidiaries and affiliates through the execution of voting
rights at the General Meeting of Shareholders, and also implement controls over important decisions,etc., concerning the operation of subsidiaries and affiliates through the Subsidiaries and Affiliates
Regulations and the Approval Regulations. Specifically, we carry out management supervision andmonitoring by dispatching non-full-time Directors and non-full-time Corporate Auditors to
subsidiaries, and also through the establishment of the Subsidiaries & Affiliates Control Department
which presides over subsidiaries, and clarification of the roles of each company, we secure
appropriate Group business management systems. Furthermore, according to the Internal Regulations
for Non-full-Time Officers of Subsidiaries and Affiliates, we also carry out education and training fornon-full-time officers dispatched from KHI.
4) The Auditing Department, which presides over Group internal audits, ensures the appropriateness ofoperations and prevents unfair transactions between Group companies through business audits andassessment of internal controls over financial reporting at KHI and subsidiaries.
5) According to the Company-wide CSR Committee Regulations, we deliberate strategies and policies
and measures concerning the Fundamental Principles of Corporate Ethics and compliance as theentire KHI Group, and secure systems to check operational status.
3. Internal controls systems for ensuring appropriate audits by Corporate Auditors(1) Systems for employees in cases where the Corporate Auditor requests appointment of employees toassist with the Corporate Auditor’s duties• We allocate the required staff (to the Corporate Auditor) according to the Corporate Auditors’requests.
(2) Systems to ensure employees who assist with the Corporate Auditors duties are independent from
Directors.
• The person employed to assist with the duties of the Corporate Auditor (assistant of the Corporate
Auditor) shall follow the Corporate Auditor’s directions and orders, and the consent of the
Corporate Auditor is required in relation to the hiring or firing of the staff.
(3) Systems for Directors and employees to report to the Board of Corporate Auditors and othersystems for reports to the Board of Corporate Auditors.

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1) Corporate Auditors attend Board of Directors Meetings, Management Committee, Executive
Officers Committee and company-wide meetings, including Company-wide CSR Committees
and Company-wide Risk Management Committees; at these meetings, Directors and employees
provide reports concerning important matters about company management and business
operations, including matters regarding compliance, risk management and internal controls, andthe status of execution of duties. Furthermore, Directors shall immediately report to the Board of
Corporate Auditors when discovering that there is a risk of the company suffering significant
damages.
2) Employees shall, in accordance with the Approval Regulations, report to the Corporate Auditor
regarding the execution of business operations by circulation of internal memos.
3) The Auditing Department and Accounting Auditors from time to time report to, and exchange
information with Corporate Auditors regarding the status of audits on each place of business andGroup companies.
(4) Other systems to ensure the effective conduct of audits by the Board of Corporate Auditors
1) Directors and Corporate Auditors regularly hold meetings to ensure mutual understanding, andthe Corporate Auditor also attends important meetings such as Board of Directors Committee
and Management Committee, and directly expresses his/her opinion regarding Directors’
execution of duties.
2) Directors promote collaboration between Corporate Auditors and the Auditing Department, andcooperate to establish systems which enable greater effectiveness in the conduct of audits.
3) Matters concerning the election of Corporate Auditors and their remuneration etc. aredetermined in accordance with laws and the Articles of Incorporation, by obtaining the consent
of Corporate Auditors, or approval of the Board of Corporate Auditors.
4. Basic stance on expulsion of anti-social forces and countermeasures
Because our Group resolutely refuses to comply with any unreasonable demands fromanti-social forces, and works to cut off all relations with anti-social forces, we distribute the“Compliance Guidebook” to all employees. Paragraph 1 of the Guidebook prohibits “giving
favors to anti-social forces,” and lists specific examples of prohibited acts. We work to ensurethat employees are thoroughly familiar with the matters contained in the Compliance Guidebook
by conducting training, etc., and do not merely distribute the guidebook.
Furthermore, with respect to internal systems, we have established a department inheadquarters which is responsible for overseeing handling of expulsion of anti-social forces,
established close cooperation with external specialized organizations such as the police force, andin collaboration with concerned departments we systematically handle unreasonable requests
from anti-social forces.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~(Note) Amounts in this Business Report are rounded down to the nearest unit.

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Consolidated Balance Sheet(As of March 31, 2012)(Unit: million yen)
Description

AmountDescription(Assets)
Current assets

Amount(Liabilities)
967,186

Current liabilities

696,002

Cash on hand and in banks

34,316

Trade payables

310,775

Trade receivables

404,054

Short-term borrowings

137,568

Merchandise and finished products

53,558Current bonds payable

10,000Work in process

300,224

Current portion of lease obligations

Raw materials and supplies

88,113

Income taxes payable

4,627

Deferred tax assets

33,007

Deferred tax liabilities

1,465

Other current assets

57,166

Advances from customers

99,050Allowance for doubtful receivables

355(3,255)

Accrued bonuses

20,582394,953

Provision for product warranties

7,128

Net property, plant and equipment

274,750

Provision for losses on construction contracts

30,977

Buildings and structures

113,632

Asset retirement obligations

Machinery and equipment

74,529Land

61,942Long-term liabilities

350,214

323

Bonds payable

60,00011,782Long-term debt

198,737

Fixed assets

Leased assets
Construction in progress

Other current liabilities

150
73,321

Other

12,540

Lease obligations

Intangible assets

18,786

Deferred tax liabilities

Investments and other assets

101,416

Provision for losses on damages suit

910

Investments in securities

23,249Provision for environmental measures

3,282

Employees’ retirement and severance benefits

75,052Long-term loans

432

Deferred tax assets

37,614

Asset retirement obligations

Other investments and other assets

41,060Other

Allowance for doubtful receivables(940)

Total liabilities

506
4,060

611
7,053
1,046,216(Net assets)
Shareholders’ equity

335,270

Common stock

104,484

Capital surplus

54,393Retained earnings

176,414

Treasury stock
Accumulated other comprehensive income(29,215)

Net unrealized gains on securities

3,989

Gains (losses) on hedging items
Foreign currency translation adjustments

Total assets

246(33,451)

Minority interests

9,868

Total net assets

315,922

1,362,139－(22)

Total liabilities and net assets

20－

1,362,139

Consolidated Statement of Income(April 1, 2011 - March 31, 2012)(Unit: million yen)
Description

AmountNet sales

1,303,778

Cost of sales

1,088,918

Gross profit

214,860

Selling, general and administrative expenses

157,375

Operating income

57,484Non-operating income

19,146

Interest income

1,672

Dividend income

658

Equity in income of non-consolidated subsidiaries andaffiliates

8,567

Foreign exchange gains, net

206

Other, net

8,041

Non-operating expenses

13,003

Interest expense

4,282

Loss on valuations of securities

918

Other, net

7,802

Recurring profit

63,627Extraordinary losses

14,921

Impairment loss

14,921

Income before income taxes

48,706

Income taxes-current

9,932

Income taxes-deferred

12,899

Income before minority interests

25,875

Minority interests in income

2,551

Net income

23,323－21－

Consolidated Statement of Changes in Net Assets(April 1, 2011 - March 31, 2012)(Unit: million yen)
Shareholders’ equity
Common stock
Balance at the beginning of the period

Capital surplus Retained earnings

104,340

54,251

144

142

Total
shareholders’equityTreasury stock

158,615(30)

317,176

13

300

Changes of items during the period
Conversion of convertible-typebonds with stock acquisition rights
Cash dividends(5,011)(5,011)

Net income for the year

23,32323,323

Treasury stock purchased
Treasury stock disposed

(0)

(3)

Effect of changes in accounting
periods of consolidated subsidiaries

(6)

(6)

1

(2)

(509)

(509)

Net changes of items other thanshareholders’ equity
Total changes of items during theperiod144

142

17,798

7

18,093

Balance at the end of the period

104,484

54,393

176,414(22)

335,270

Accumulated other comprehensive income
Foreign currency Total accumulated
other comprehensive
translation
incomeadjustments

Net unrealized
Gains (losses) on
gains on securities hedging items

Balance at the beginning of the period

3,876

(990)

(31,006)(28,119)

Minority
interests
8,376

Total
net assets
297,433

Changes of items during the period
Conversion of convertible-typebonds with stock acquisition rights

300

Cash dividends(5,011)

Net income for the year

23,323

Treasury stock purchased(6)

Treasury stock disposed(2)

Effect of changes in accounting
periods of consolidated subsidiaries(509)

Net changes of items other thanshareholders’ equity

112

1,236

(2,444)(1,095)

1,491

395

Total changes of items during theperiod112

1,236(2,444)(1,095)

1,491

18,489Balance at the end of the period

3,989

246

(33,451)(29,215)9,868

315,922－22－

Non-consolidated Balance Sheet(As of March 31, 2012)
Description(Assets)
Current assets
Cash on hand and in banks
Notes receivable-trade
Accounts receivable-trade
Raw materials and supplies
Work in process
Advance payments
Prepaid expenses

AmountDescription

777,442
17,291
7,204
310,567
61,359252,788
14,327
3,205

Deferred tax assets

25,110

Short-term loans
Accounts receivable-otherAccrued income
Other current assets
Allowance for doubtful receivables

52,58021,567
124
13,173(1,859)Fixed assets
Net property, plant and equipment

367,175
178,444

Buildings
Structures
Docks and building berths
Machinery and equipment
Vessels
Aircraft
VehiclesTools, Furniture and fixtures

61,332
13,086696
53,035
4
97
476
7,988

Land

35,630

Leased assets
Construction in progress

226
5,869

Intangible assets

15,498

SoftwareLicense production and licensee’s
execution right
Other intangible assets
Investments and other assets
Investments in securities
Stock of affiliates
Investments in capital of affiliates
Long-term loans
Deferred tax assets
Other investments and other assets
Allowance for doubtful receivables

11,441

Total assets

665
3,391
173,232
21,66088,38818,941
7,377
30,004
7,408(547)

1,144,618－

23(Liabilities)
Current liabilities
Notes payable-trade
Accounts payable-trade
Short-term borrowings
Current portion of long-term debt
Current bonds payable
Notes payable-facilities
Lease obligations
Accumulated impairment loss on
leased assets
Accounts payable-otherAccrued expenses
Income taxes payable
Advances from customers
Deposits received
Unearned revenue
Accrued bonuses
Provision for product warranties
Provision for losses on construction
contracts
Asset retirement obligations
Other current liabilities
Noncurrent liabilities
Bonds payable
Long-term debt
Lease obligations
Accumulated impairment loss on
leased assets
Long-term accounts payable-other
Provision for losses on damages suit
Provision for environmental measures
Employees’ retirement and severance
benefits
Asset retirement obligations
Other long-term liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Legal capital surplus
Retained earnings
Other retained earnings
Provision for special depreciation
Provision for advanced depreciationof fixed assets
Retained earnings brought forward
Treasury stock
Valuation and translation adjustments
Net unrealized gains on securities
Gains (losses) on hedging items
Total net assets
Total liabilities and net assets－(Unit: million yen)Amount583,001
33,202
260,422
77,433
24,592
10,000741
9360
20,921
30,217
138
68,9002,246
23
14,272
4,705
28,331
150
6,331
306,576
60,000198,342
3
693
2,509
910
3,130
40,203543
239
889,578

251,366
104,484
52,21052,21094,694
94,694
1,085
7,363
86,245
(22)
3,672
3,410
262
255,039
1,144,618

Non-consolidated Statement of Income(April 1, 2011 - March 31, 2012)(Unit: million yen)
Description

AmountNet sales

1,003,390

Cost of sales

889,083

Gross profit

114,307

Selling, general and administrative expenses

89,235

Operating income

25,072Non-operating income

23,411

Interest income

631

Dividend income

16,353Foreign exchange gains

545

Other

5,881

Non-operating expenses

10,455Interest expense

2,939Interest on bonds

871

Loss on valuation of securities

905

Loss on disposal of fixed assets

979

Other

4,758

Recurring profit

38,029Extraordinary losses

14,856

Impairment losses

14,856

Income before income taxes

23,172

Income taxes-current(686)

Income taxes-deferred

12,367
11,680Net income

11,491－24－

Non-consolidated Statement of Changes in Net Assets(April 1, 2011 - March 31, 2012)(Unit: million yen)
Shareholders’ equity
Retained earnings
Other retained earnings
Reserve for
Retained
advanced
Reserve for
earnings
specialdepreciation
brought
depreciationof fixed
forwardassetsCapital surplus
Commonstock

Balance at beginning of period
Changes of items during the period
Conversion of convertible bonds
with stock acquisition rights
Cash dividends
Net income for the year
Treasury stock purchased
Treasury stock disposed
Provision for special depreciation
Reversal of provision for special
depreciation
Provision for advanced
depreciation of fixed assets
Reversal of provision for advanced
depreciation of fixed assets
Net changes of items other thanshareholders’ equity
Total changes of items during theperiodBalance at end of period

Legalcapitalsurplus104,340

52,067

144

142

Other
capitalsurplus
0

942

(0)

13

300

(6)
1

(5,011)
11,491
(6)
(2)
-

350
(207)

207

-

556

(556)

-

(152)

152

-

142

(0)

143

403

5,929

7

6,771

104,484

52,210

-

1,085

7,363

86,245(22)

251,366

3,219

Total
Gains (losses)
valuation andon hedging
translation
items
adjustments
(925)

Total
net assets

2,293

246,888

Conversion of convertible bonds
with stock acquisition rights

300

Cash dividends(5,011)

Net income for the year

11,491

Treasury stock purchased(6)

Treasury stock disposed(2)

Provision for special depreciation-

Reversal of provision for special
depreciation-

Provision for advanced
depreciation of fixed assets-

Reversal of provision for advanced
depreciation of fixed assets-

Balance at end of period

244,595(3)(350)

Changes of items during the period

Total changes of items during theperiod

(30)

144

Net
unrealized
gains onsecurities

Net changes of items other thanshareholders’ equity

80,316

Total
shareholders’equity(5,011)
11,491

Valuation and translation adjustments

Balance at beginning of period

6,959

Treasury stock

190

1,188

1,379

1,379

190

1,188

1,379

8,150

3,410

262

3,672

255,039－

25－

Board of Corporate Auditors’ audit report (duplicated copy)

Audit Report(English Translation)
Regarding the performance of duties by the Directors for the 189th fiscal year from April 1, 2011 toMarch 31, 2012, the Board of Corporate Auditors hereby submits its audit report, which has been prepared
upon careful consideration based on the audit report prepared by each Corporate Auditor.
1. Summary of Auditing Methods by the Corporate Auditors and Board of Corporate Auditors
The Board of Corporate Auditors established auditing policies, allocation of duties, and other relevant
matters, and received reports from each Corporate Auditor regarding his audits and results thereof, as well as
received reports from the Directors, other relevant personnel, and the Accounting Auditor regarding
performance of their duties, and sought explanations as necessary.
Each Corporate Auditor complied with the auditing standards of the Corporate Auditors established by
the Board of Corporate Auditors, followed the auditing policies, allocation of duties, and other relevant
matters, communicated with the Directors, internal control development division, Auditing Department(internal audit dept.) and other employees, and any other relevant personnel, and made efforts to prepare theenvironment for information collection and audit, as well as participated in meetings of the Board of
Directors and other important meetings, received reports from the Directors, Executive Officers, employees,
and other relevant personnel regarding performance of their duties, sought explanations as necessary,
examined important authorized documents and associated information, and studied the operations andfinancial positions at the head office and principal business offices.
In addition, regarding the system for ensuring that the performance of duties by the Directors conforms to
the related laws and regulations and Articles of Incorporation, and the system prepared based on the contentsof the resolutions of the Board of Directors and such resolutions regarding preparation of the systemstipulated in Article 100, Paragraphs 1 and 3, of the Ordinance for Enforcement of the Companies Act(internal control system), which system is necessary for ensuring that a joint stock corporation’s business isproper, we received reports from the Directors, employees, and other relevant personnel regarding thestructure of the system and the status of its operation, and sought explanations as necessary.
Furthermore, with respect to internal controls on financial reporting under the Financial Instruments andExchange Act, we received reports from the Directors as well as KPMG AZSA LLC regarding theassessment of the internal controls concerned and the status of auditing thereof, and sought explanations asnecessary.
With respect to subsidiaries, we communicated and exchanged information with Directors, Corporate
Auditors, and other relevant personnel of the subsidiaries, and received business reports from subsidiaries asnecessary.
Based on the above methods, we examined the business report and annexed specifications related to therelevant fiscal year.
Furthermore, we audited whether the Accounting Auditor maintained their independence andimplemented appropriate audits, as well as received reports from the Accounting Auditor regarding theperformance of their duties and sought explanations as necessary. In addition, we received notice from the
Accounting Auditor that “the system for ensuring that duties are performed properly” (matters set forth ineach item of Article 131 of the Ordinance for Corporate Accounting) has been prepared in accordance with
the Product Quality Management Standards Regarding Audits (issued by the Business Accounting
Deliberation Council (BACD) on October 28, 2005) and other relevant standards, and sought explanations asnecessary.
Based on the above methods, we examined the non-consolidated financial statements (non-consolidatedbalance sheet, non-consolidated statement of income, non-consolidated statement of changes in net assets,
and non-consolidated notes) and their annexed specifications, as well as consolidated financial statements(consolidated balance sheet, consolidated statement of income, consolidated statement of changes in net
assets, and consolidated notes) related to the relevant fiscal year.

－

26

－

2. Results of Audit(1) Results of Audit of Business Report and Other Relevant Documents(i) In our opinion, the business report and the supplementary schedules are in accordance with therelated laws and regulations and Articles of Incorporation, and fairly represent the Company’s
condition.
(ii) We have found no evidence of wrongful action or material violation of related laws and regulations,nor of any violation with respect to the Articles of Incorporation, related to performance of duties
by the Directors.
(iii) In our opinion, the contents of the resolutions of the Board of Directors related to the internal
controls system are fair and reasonable. In addition, we have found no matters on which to remark
regarding the information contained in this Business Report and the performance of duties by the
Directors related to such internal controls system.
In addition, with respect to internal controls over financial reporting, at the time of preparation ofthis audit report, we received report from the directors that states that the said controls wereeffective, and also received report from KPMG AZSA LLC that states that no material weakness inthe said controls.
(2)

Results of Audit of Non-consolidated Financial Statements and Supplementary Schedules
In our opinion, the methods and results employed and rendered by KPMG AZSA LLC are fair andreasonable.

(3)

Results of Audit of Consolidated Financial Statements
In our opinion, the methods and results employed and rendered by KPMG AZSA LLC are fair andreasonable.

May 24, 2012
Board of Corporate Auditors, Kawasaki Heavy Industries, Ltd.
Full-Time Corporate Auditor
Full-Time Corporate Auditor
Outside Corporate Auditor
Outside Corporate Auditor

－

27

－

Nobuyuki Okazaki
Tatsuyoshi Ogushi
Kenzo Doi
Michio Oka

Reference Documents for the General Meeting of Shareholders
Proposals and References
Proposal No. 1: Appropriation of Retained Earnings
The Company’s basic policy is to pay stable cash dividends to its shareholders, giving due attention toincreased retained earnings to strengthen and expand its business foundations for future growth.
Taking into consideration the earnings forecasts and the level of retained earnings etc., the annual cash
dividend will amount to ¥5 per ordinary share for a total of ¥8,359,077,665.
In addition, the Company’s year-end dividend distribution is June 28, 2012.
Proposal No. 2 Proposed Amendments to the Articles of Incorporation
1. Reasons for amendment
We believe that for the purpose of achieving the targets of “Kawasaki Business Vision 2020,” which
was formulated in 2010 (net sales of ¥2 trillion, recurring profit of ¥100 billion), it is essential tostrengthen and expand the management foundation. In order to do so, the Company proposes anincrease in the number of Directors from fifteen or less (current) to eighteen or less.
2. Contents of proposed amendments
The contents of the proposed amendments are as follows:(Underline indicates amendment)
Current Articles of Incorporation

Proposed provisions after amendment(Number of Directors)
Art.21:
The authorized number of Directors of the
Corporation shall not exceed 18.

(Number of Directors)
Art.21:
The authorized number of Directors of the
Corporation shall not exceed 15.

Proposal No. 3 Election of Thirteen Directors
The term of office of all eleven Directors will expire at the conclusion of this Ordinary General Meetingof Shareholders. Accordingly, we propose to elect thirteen Directors to promote various efforts toward theenhancement of our corporate value, in initiatives such as the new appointment of a Director responsible for
the Marketing Division, which was established in April 2012, in the aim of developing the integrated
solution business in the global market.
The candidates for Director are as follows:
No.

1

2

Name
(Date of Birth)Tadaharu Ohashi(Nov. 9, 1944)

Masashi Segawa(Nov. 22, 1947)

Apr. 1969
Jun. 2003
Apr. 2005
Jun. 2005
Jun. 2009

Apr. 1970
Jun. 2005
Apr. 2009
Apr. 2012

Abridged Personal Records, Positions and Duties[Significant concurrent positions]
Joined Kawasaki Heavy Industries, Ltd.
Senior Vice President
Senior Executive Vice President
President
Chairman of the Board(current position)[Significant concurrent positions]
Chairman, The Kobe Chamber of Commerce and Industry
Vice Chairman, Kansai Economic Federation
Joined Kawasaki Heavy Industries, Ltd.
Senior Vice President
Senior Executive Vice President
Senior Executive Vice President
Assistant to the President, In charge of Marketing Division,
Procurement Division and Corporate Technology Division(current position)

－

28

－

Shares of theCompany

126,000
shares120,000
shares

No.

3

Name
(Date of Birth)
Satoshi Hasegawa(Aug. 16, 1947)

Apr. 1972
Jun. 2007
Apr. 2009
Jun. 2009
Apr. 1972
Jun. 2008
Apr. 2012

4

Mitsutoshi Takao(Apr. 1, 1950)

Apr. 1971
Jun. 2005

Apr. 2008

Jun. 2009
5

Nobumitsu
Kambayashi(May 28, 1948)
Apr. 2010

Oct. 2010

Apr. 1973
Apr. 2008
6

Kyohei Matsuoka(Sep. 16, 1949)

Apr. 2009
Jun. 2009

Apr. 1972
Apr. 2007
Apr. 2009
7

Hiroshi Takata(Jan. 5, 1950)

Jun. 2009
Apr. 2010

8

Makoto Sonoda(Dec. 7, 1948)

Apr. 1971
Jun. 2007
Jun. 2010
Oct. 2010

Abridged Personal Records, Positions and Duties[Significant concurrent positions]
Joined Kawasaki Heavy Industries, Ltd.
Senior Vice President
Senior Executive Vice President
President(current position)
Joined Kawasaki Heavy Industries, Ltd.
Senior Vice President
Senior Executive Vice President
Assistant to the President, In charge of Corporate Planning
Division, Finance & Accounting Division, CSR Division,
Personnel & Labor Administration Division and General
Administration Division(current position)
Joined Kawasaki Heavy Industries, Ltd.
Senior Vice President
General Manager, Marketing & Sales Division,
Kawasaki Shipbuilding Corporation
Managing Executive Officer
General Manager, Corporate Business Development Division,
Kawasaki Heavy Industries, Ltd.
Senior Vice President,
Kawasaki Shipbuilding Corporation
Senior Vice President
General Manager, Corporate Business Development Division,
Kawasaki Heavy Industries, Ltd.
Senior Executive Vice President,
Kawasaki Shipbuilding Corporation
Senior Vice President
Kawasaki Heavy Industries, Ltd.
President, Kawasaki Shipbuilding Corporation
Senior Vice President
President, Ship & Offshore Structure Company(current position)[Significant concurrent position]
Chairman,
Nantong COSCO KHI Ship Engineering Co., Ltd. (note)
Joined Kawasaki Heavy Industries, Ltd.
Managing Executive Officer
Vice President, Rolling Stock Company
Managing Executive Officer
President, Rolling Stock Company
Senior Vice President
President, Rolling Stock Company(current position)
Joined Kawasaki Heavy Industries, Ltd.
General Manager, Research & Development Division, Consumer
Products & Machinery Company
Managing Executive Officer
President, Consumer Products & Machinery Company
Senior Vice President
President, Consumer Products & Machinery Company
Senior Vice President
President, Motorcycle & Engine Company(current position)
Joined Kawasaki Heavy Industries, Ltd.
President, Kawasaki Precision Machinery, Limited.
Director, Kawasaki Heavy Industries, Ltd.
President, Kawasaki Precision Machinery, Limited.
Senior Vice President
President, Precision Machinery Company(current position)

－

29

－

Shares of theCompany
113,000
shares92,000shares44,000shares

71,000shares

47,000shares44,000sharesNo.

Name(Date of Birth)
Apr. 1974
Apr. 2008

9

Shigeru Murayama(Feb. 27, 1950)

Apr. 2010
Jun. 2010

Apr. 1977
July. 2006

10

Joji Iki(Sep. 5, 1951)

Apr. 2009

Apr. 2012

Apr. 1975
Apr. 2007
Apr. 2008
11

Masahiko Hirohata(Sep. 20, 1951)

Apr. 2011

Apr. 2012

Apr. 1974
Apr. 2005
Jun, 2008
Jun. 201012

Eiji Inoue(Feb. 22, 1952)

Oct. 2010

Apr. 2011
Apr. 2012

Apr. 1976
Oct. 2007
Dec. 200813

Yoshinori
Kanehana(Feb. 19, 1954)

Jan. 2009
Apr. 2009
Apr. 2011
Apr. 2012

Abridged Personal Records, Positions and Duties[Significant concurrent positions]
Joined Kawasaki Heavy Industries, Ltd.
Managing Executive Officer
Vice President, Aerospace Company
Managing Executive Officer
President, Aerospace Company
Senior Vice President
President, Aerospace Company(current position)
Joined Kawasaki Heavy Industries, Ltd.
Deputy General Manger, Machinery Division, Gas Turbine &Machinery Company
Executive Officer
General Manager, Machinery Division, Gas Turbine &Machinery Company
Managing Executive Officer
President, Gas Turbine & Machinery Company(current position)
Joined Kawasaki Heavy Industries, Ltd.
General Manager, Planning & Control Division, Gas Turbine &Machinery Company
Executive Officer
General Manager, Planning & Control Division, Gas Turbine &Machinery Company
Managing Executive Officer
General Manager, Corporate Planning Division
Senior Manager, Infrastructure Strategy Office
Managing Executive Officer
General Manager, Corporate Planning Division(current position)
Joined Kawasaki Heavy Industries, Ltd.
Senior Manager, Industrial Plant Engineering Division,
Kawasaki Plant Systems, Ltd.
Director, Kawasaki Plant Systems, Ltd.
Senior Vice President
General Manager, Project Engineering Center, Kawasaki Plant
Systems, Ltd.
Executive Officer
General Manager, Project Engineering Center, In charge of Kobe
Engineering Department, Plant & Infrastructure Company,
Kawasaki Heavy Industries, Ltd.
Executive Officer
Vice President, Plant & Infrastructure Company
Managing Executive Officer
President, Plant & Infrastructure Company(current position)
Joined Kawasaki Heavy Industries, Ltd.
General Manager, Project Management Division, Rolling Stock
Company
General Manager, Rolling Stock Division,
General Manager, Project Management Center, Rolling Stock
Division, Rolling Stock Company
General Manager, Rolling Stock Division, Rolling Stock
Company
Executive Officer
Vice President, Rolling Stock Company
Managing Executive Officer
Vice President, Rolling Stock Company
Managing Executive Officer
General Manager, Marketing Division(current position)

Shares of theCompany

94,000shares7,000
shares

48,000shares

21,000shares

21,000Shares(Note) Nobumitsu Kambayashi is concurrently Chairman of Nantong COSCO KHI Ship Engineering Co., Ltd., and we havetransactions with this corporation in the following businesses.
• Guaranteeing borrowings from the bank to Nantong COSCO KHI Ship Engineering Co., Ltd.
• Sales of steering gear , etc.

－

30

－

There is no special conflict of interest between the Company and the other candidates.

Proposal No. 4 Election of One Corporate Auditor
As the term of office of the concurrent Corporate Auditor, Mr. Nobuyuki Okazaki will expire at theconclusion of this Ordinary General Meeting of Shareholders, we propose to elect one Corporate Auditor.
We have obtained the prior approval of the Board of Corporate Auditors on this proposal.
The candidate for Corporate Auditor is as follows.
Name(Date of Birth)
Yuji Murakami(Oct. 30, 1952)

Apr. 1975
Apr. 2005
Jun. 2009
Apr. 2012

Abridged Personal Records, Positions and Duties[Significant concurrent positions]
Joined Kawasaki Heavy Industries, Ltd.
Deputy Senior Manager, Finance & Accounting Department
Senior Manager, Auditing Department
Staff Officer to Corporate Auditor(current position)

Shares of theCompany
10,000shares(Notes) There is no special conflict of interest between the Company and the candidate for Corporate Auditor.

Proposal No. 5 Revision of Amount of Compensation Payable to Directors
At the 178th Ordinary General Meeting of Shareholders held on June 28, 2001, it was approved that theamount of compensation for Directors would be ¥60 million or less per month (¥720 million or less peryear).
The Company proposes to determine an amount of compensation per year, instead of an amount ofcompensation per month and then revise the amount of compensation for Directors to ¥1.2 billion per year
(for each fiscal year) for the following main reasons:(1) With the aim of strengthening and expanding the management foundation to attain the targets of“Kawasaki Business Vision 2020,” the Company has proposed to increase the authorized
number of Directors by 3 (from the current fifteen to eighteen) in Proposal No. 2; and(2) The Company has further increased the proportion of corporate performance-linked
compensation, and has revised the compensation system in which the maximum compensation isthe amount of compensation to be received in the case that the targets of “Kawasaki Business
Vision 2020” are attained.
With respect to Directors concurrently serving as employees, their employee salaries are not included incompensation payable to Directors as before.
The number of Directors is currently eleven and will be thirteen if Proposal No. 3 is approved andadopted.

－31－