CONTENTSCONTENTSManagement

Message from the President
Notes on FY 2008 ReportManagement Philosophy
Company Overview
Corporate GovernanceInternal Control
Environment/Safety Management Organization
Compliance Promotion
Information Management

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CSR Report

Relationships with Clientst
Ensuring Product Safety
Quality Assurance Activities
Relationships with Shareholders & Investors
IR Activities
Share Status
Giving Back to the Community
Efforts Toward Environmental Improvement
Disaster Prevention & Readiness Efforts
Promoting Regional Environmental Awareness
Public Relations Activities
Concern for Our Employees
Personnel System
Equal Opportunity
Human Resource Development
Employee Mental Health
Human Rights
Safety & Health Activities
Asbestos Removal

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Environmental
ReportBasic Environmental Policy
Medium-Term Environmental Plan
Unitika's History of Environmental Preservation Activities
Overview of Environmental Impact
Work on Reducing Environmental Impact
Air Pollution
Water Pollution
Waste Products
Handling of Chemical Substances
Energy Saving & Global Warming
Reducing Greenhouse Gases by Changing Energy Fuel Sources
Logistics
Environmental Complaints
Environmental Accounting
Shioli's Environmental Report from the Unitika Okazaki Plant
Technology and Products for Environmental Safety
Water Treatment Facilities
Garbage Incinerating Facilities
Air Pollution
Recycled Polyester Fiber / Uniecolo
New Natural Fibers / Sylph
Recycled Polyester Nonwoven Sheeting / Ecomix
Anticorrosive Sheeting / Segurova
Plant-Derived Biomass Material / Terramac
Production Site Information

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1

Message from the President

As a good corporate citizen,
we contribute to a healthier environment
and a more comfortable way of life.
Otofumi Onishi
President

At the Unitika Group, we arecommitted to a wide range ofinitiatives targeting enhanced
enterprise value and long-term
corporate growth. The basis ofthese initiatives is formed bydevelopment and enhancementof our business as well as byestablishing a robust cooperate
structure that provides us withthe ability to respond to ongoingchanges in the businessenvironment. However, we arealso acutely aware of how ourbusiness initiatives areintertwined with our corporatesocial responsibility, and weunderstand that it is absolutely
essential for a better enterprisevalue to establish a relationshipof trust with our stakeholders. For the Unitika Group, thisapproach has always demonstrated our long-term
commitment to our corporate social responsibility (CSR).
In promoting our CSR initiatives, we have also
remained dedicated to defining and developing thesystems required to implement and manage our essentialfunctions, which include addressing environmental issues,ensuring legal compliance, managing product safety, andimplementing internal audits and controls. In July 2008, weestablished our CSR Office to ensure that we pursue theseimportant functions with greater effectiveness andoversight. Headed by the Director in charge and managed
by the full-time senior management staff, this office isempowered to address a comprehensive range of CSR
requirements. For example, it has pursued risk
management by adopting a system that ensures rapid andeffective risk assessment and response.
Among the most important of Unitika's CSR initiatives
are those that address environmental challenges. Thisemphasis is appropriate, as the twenty-first century has
been called "the era of the environment," with issues suchas the potential for global warming and environmental
pollution now assuming a significantly greater share of ourcorporate responsibility. In keeping with our Group ideal of"contributing to society by linking lifestyles andtechnologies," we have long made a priority of interlinking

our Group's corporate initiatives
while placing priority on theenvironment.
Our focus on theenvironment testifies to ourbasic approach of contributing
to the emergence of a society
committed to recycling
resources. It includes a varietyof efforts to reduce ourenvironmental load, including
the development of recycling
technologies for processing
refuse and wastewater, thedevelopment of biomass-based
polylactide polymer Terramac®
contributing to less emission ofCO2, and the implementation ofenvironmental assessments
targeting the air, water, and soil,
all of which reflect Unitika's commitment to theenvironment. We are also promoting Group-wide
registration for the ISO 14001 environmental management
standards, of which certification encompasses six Unitika
plants and other major facilities; moreover, our main plants
have converted from oil to natural gas for their energy
requirements. Clearly, in terms of both our business andoperations, we have been focusing on the most pressing
environmental issues.
Under our medium-term management plan New
Progress 8 (NP-8), now in its third and final year of
implementation, we have been cultivating the eco-friendly
business models as reflected by our our environmental
plant business, our environmental materials business, andour reputation as a manufacturer of Terramac®. This
testifies to our management vision as a good corporate
citizen contributing to a healthier environment and a more
comfortable way of life. Committed to reinforcing andpromoting these efforts and building upon our past
initiatives as an environmentally responsible company, we
are now in an excellent position to promote additional
specific goals as required by CSR.
I trust this report clarifies our commitment to the CSR
initiatives the Unitika Group is pursuing as a responsible
corporate citizen, and I welcome your support as we
pursue these initiatives.
2

Management

Notes on FY 2008 Report
History of Report

Period Covered by Report
This report covers principally the period from April 1, 2007
through March 31, 2008, however it does address certain items,
and events arisen after April 1, 2008.

This report was originally issued as the Unitika Environmental
Report, a document which detailed Unitika's various
environmental and social related activities. By 2006, the Report
has expanded CSR coverage, reflecting the growing importanceof this area and greater attention it is receiving in Japan. The
CSR information includes topics such as corporate governance,internal control and other principles and systems in use by theGroup. The Report is now issued annually as CSR Report.

Reference Guidelines
This report refers to the Environmental Report Guidelines (2007
edition) issued by the Ministry of the Environment.

2002-2005 Unitika Environmental Report
2006- Unitika CSR Report

What This Report Covers
This report in principle covers activities by Unitika, Ltd.'s domestic production sites and the Unitika Group companies including thoseoverseas and Environmental Report covers the following range of items.

Unitika Production
Sites in Japan

Internal Group Companies

External Group Companies

Uji Plant

Ad'all Co., Ltd.

Okazaki Plant

Nippon Ester Co., Ltd.

Sakoshi Plant* U-ai Electronics Corp.
* Unitika NP Cloth Co., Ltd.

* I-Tex Co., Ltd.
* Osaka Dyeing Co., Ltd.
* Diabond Chemical Co., Ltd.
* Terabo Co., Ltd.

Tarui Mill
Toyohashi OfficeTokiwa Mill
Miyagawa Mill
Kaizuka OfficeCentral R&D
Laboratories

Unitika Environmental TechnicalCenter Co., Ltd.

Union Co., Ltd.

Unitika Glass Fiber Co., Ltd.
Unitika Plant Engineering Co., Ltd.
Unitika Textiles Ltd.

* Unitika Sparklite., Ltd.
* Unitika Spinning Co., Ltd.
* Unitika Berkshire Co., Ltd.

Unitika Fibers Ltd.
Unitika Logistics Co., Ltd.

*Of the Group companies that the report had covered until last year, Unitika Protech Sakoshi, Unitika Spunbond Products Co.,
Ltd. and Unitika Uji Products Co., Ltd., were merged into Unitika, Ltd. as of 1 October, 2007. Further, the nine companies listedwith an asterisk (*) were added to this report starting this year.

Date of Issue

Next Report

This report can be accessed on Unitika's company website from
1 October 2008. In light of the potential environmental impact, no
printed version is issued.

October 20093

Management

Management Philosophy"Contributing to society by connecting persons' living to technologies"
The Unitika group's management philosophy is to connect persons' living to technology, and aims to be "a company with aclear social presence that contributes positively to the environment and to people's living."

The Unitika Group Slogan

There is an unimaginable number of people in the world. There is an unimaginable number of dreams and hopes.
The Unitika Group aims to unite all of these with one desire. One desire to improve the lifestyle of persons,living together in harmony within the global environment.
Unitika has the creative power to bring about this way of thinking. We also possess the technology andenergy to turn these possibilities into realities. We have taken the time to unite all the companies involved in our various
businesses, ensuring we are operating at full capacity through unification of our capabilities across numerous fields.
Unitika consistently strives to work together toward this goal.
The possibility of improving persons' lifestyle - We Realize It! We are the Unitika Group.

Company Overview
Name: Unitika Ltd.
Founded: June 19, 1889
Capital: 23.8 billion yen (as at March 31, 2008)
Number of employees (consolidated): 5,531 (as at March 31, 2008)
Sales (consolidated): 234.7 billion yen (FY 2007)
Main business areas (consolidated): Polymers (films, resins, chemical products, spunbond), environmental/advanced materials(engineering, pharmaceutical products, functional materials), fibers (synthetic and natural fiber yarns, staple fibers, woven andknitted fabrics), health & amenity products, other business areas

Sales (Non-Consolidated/Consolidated)(Billions of yen)
2,500

Sales Share of Each Business Unit
(FY 2007, Consolidated)

Non-consolidated
Consolidated

Health & amenity
products, other

2,000

10%

1,500

Environmental/
advanced materials

1,000

15%

Fibers

500
0

'03

'04

'05

'06

Sales:
234.7
billion yen'07

Employees (Consolidated)
5,600
5,400

Polymers
30%

5,200
5,000
4,800
4,600
4,400

'03

'04

'05

'06

'07

4

45%

Management

Corporate Governance
Basic Policy for Corporate GovernanceUnitika's management vision is to be a corporation thatmakes its social presence enriches lives and helps theenvironment. To bring this vision to our business, we are
implementing a new medium-term management plancalled New Progress 8 (NP-8) that covers dual areas for
improvement-our business strategy and our corporate
governance strategy. This section describes the Group's
ongoing corporate governance efforts.

In March 2006, Unitika announced a new medium-term
management plan called New Progress 8 (NP-8) to be
implemented over the three-year period through FY 2008. The
plan covers both business strategy and corporate governancestrategy. Under the rapid decision-making, we work on the
management of valuing the stake holder through strengthening
compliance and risk management, and timely and accurate
information disclosure. Consistent adherence to thismanagement approach will increase Unitika's corporate value intoday's increasingly globalized economy, to enable sustained
growth.

Overview of NP-8

Management vision
To be a corporation that makes its social presence, enriches lives
and helps the environment.

Corporate governancestrategy

Business strategy
Strengthening businesscompetency

Dual improvement
areas

Strengthening corporate
quality

Implementation
In 2000, Unitika adopted a management system that sets forth
two separate function areas: management
decision-making/supervisory functions ('governance') andbusiness execution functions ('management'). The Board of
Directors specializes in the first set of functions, aided by theManagement Strategy Council, an organization that provides
directors the opportunity for more in-depth discussions on
policies and issues pertaining to all aspects of the Group's
management. The second set of functions are implemented by
the Executive Director System and a President's advisory bodyknown as the Business Execution Council, which speed
decision-making and demarcate areas of responsibility.
In 2006, in addition to setting forth a set of basic policies oninternal control, we established a CSR Compliance Group.
Additionally, we reviewed our administrative structures, making
changes such as enabling directors to also serve as executive
officers.
In 2008 we set up a CSR Office, as well as a system forcompliance and risk management in order to promote internal
control.

5Management

Internal Control
In April 2007, we created the Internal Control Promotion Office, and began implementing internal control for financial reporting.
In July 2008, we established CSR Office by integrating all the sections related to internal controls.

Basic Policy
Set forth in the nine items of Unitika's Basic Policy for Internal Control.

Unitika's Basic Policy for Internal Control (Item Headings)
1. Organization to ensure that the execution of job duties by directors and employees complies with allapplicable legislation and the Articles of Incorporation
2. Items pertaining to saving/managing information on directors' execution of job duties
3. Regulations on loss hazard management; other organizational elements
4. Organization to ensure that execution of directors' job duties is performed efficiently
5. Organization to ensure suitability of operations done by corporate groups
6. Organization to secure the reliability of financial reports.
7. When auditors ask for appointment of employees to act as assistants
Items pertaining to organization for those employees, and to their independence from directors
8. Organization used for directors and employees to report to auditors; organization for reporting toother auditors
9. Other organizational elements to ensure that auditing by auditors is performed effectively

Organization
The diagram below shows the organization used for corporate governance, and to ensure fair corporate activities. The basic elements
correspond to Unitika's Basic Policy for Internal Control (outlined above). This organization is used to strictly enforce internal
control-compliance, information saving/management, risk hedging, increasing the execution efficiency of director job duties, and ensuring
the suitability of operations.

Organization
General Meeting of Stockholders
Appointing/terminating

Appointing/terminating

Appointing/terminating

ReportingManagement Strategy
Council(All directors)* Discusses important issues.

Discussion ofimportant issues

Board of Directors(Nine directors)

Auditing

Appointing/terminating, Reporting
instructions

Accounting
AuditorReportingBoard of Auditors(Four auditors)(Including two outside auditors)

Appointing/terminating,supervision

Determining suitabilityof accounting auditing,witnessing auditing

Auditor staff
Executive Officers(ten)(Including seven executive officers
also acting as directors)

Representative
Directors(three)* Execute business operations.

Auditing

Reporting

ReportingPresident

CSR OfficeInstructions

Reporting

Reporting
Advisory
organization

Business Execution Council(Directors, Executive Officers)

Promotion, management
Instructions

Committees:
Risk Management Committee
Export Management Committee
Central Committee on
Product Liability, others

ReportingBusiness departments, Group companies

6Management

Environment/Safety Management Organization
The Environment Committee, one of the original committees, meetsregularly every year. It discusses and votes on major environmental
issues such as basic plans for environmentally-aware management,
and verification of their progress. Also, the bureau of theEnvironment Committee implements environmental audits of our
production sites and reports on the findings of these at theenvironmental committee meetings.
The Central Safety and Sanitation Committee and the Environment
Committee act as departments dedicated to safety andenvironmental measures, and have a higher level of authority in the
Unitika hierarchy than the Environmental Safety Groups of Unitika
production sites or affiliates. They form an organization that provides
the leadership to implement effective environmental measures.

To implement CSR-driven environmental awareness andsafety measures, we have established, as a management
organization, the CSR office consisting of several
committees and business divisions.
Unitika's original environment/safety management organizationconsisted of three committees and business divisions. A newcommittee (the Corporate Action Committee) was added in 1998.
The organization was again expanded in 2006, to encompass theCompliance Committee, becoming a driver of compliancepromotion. Also, in 2008 we established a Risk Management
Committee with the aim of securing and reinforcing our corporaterisk management structure.

Environmental/Safety ManagementOrganization
President

CSR Office

Risk Management Committee

Compliance Committee

Business division

Environment Committee

Central Safety andSanitation Committee
Central Committee
on Product Liability

Production site

Affiliate

Environmental
Safety Group

Environmental
Safety Group

Activity planning,
implementation and management

Policy setting and auditing

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Management

Compliance Promotion
In 1998, Unitika instituted the Unitika Action Charter.
In April 2008 we reviewed the Unitika Action Standards that specifies the action
standards in a concrete manner. These standards are distributed to all Unitika
Group employees, so that they can take an action in consideration of ourcompliance policy, and contribute to people's living and environment as well.

Unitika Charter of Corporate Behavior
The Unitika Charter of corporate behavior is our basic policy on how best to fulfill our mission as a public-spirited corporation. It applies to all
directors and employees of Unitika and Unitika Group companies.
The Unitika Charter of Corporate Behavior is a set of guidelines on how to act for the public good by complying withlaws and international standards and guidelines.
1.UNITIKA, by the development and provision of socially beneficial goods and services in a safe and responsible manner, shall strive to earn theconfidence of their consumers and customers.
2.UNITIKA shall promote fair, transparent, free competition and sound trade. They shall also ensure that their relationships and contacts withgovernment agencies and political bodies are of a sound and proper nature.
3.UNITIKA shall engage in communication not only with shareholders but also with members of society at large, including active and fair disclosure ofcorporate information.
4.UNITIKA shall strive to respect diversity, individuality and differences of their employees, to promote safe and comfortable workplaces, and to ensure
the mental and physical well-being of their employees.
5.UNITIKA shall respect the culture and customs of other nations and strive to manage their overseas activities in such a way as to promote andcontribute to the development of local communities.
6.UNITIKA shall reject all contacts with organizations involved in activities in violation of the law or accepted standards of responsible social behavior.
7.As a ''good corporate citizen,'' UNITIKA shall respect fundamental human rights and actively engage in philanthropic activities, and other activities ofsocial benefit.

Compliance Committee
In May 2006 Unitika renewed the Corporate Behavior Committee, which was originallyestablished along with the Unitika Action Charter. New committee is called Compliance
Committee staffed by the company directors and chaired by the president. It receives reports oncompliance issues from each business division, department and office, then uses thisinformation to assess potential compliance-related risks, implement preventative measures, andreinforce the company's compliance assurance systems.

Compliance Committee
Committee
chairmanCommittee
members

President

Directors

Unitika's Whistleblower Contact Points

Whistleblower Contact Points

Contact point 1

Contact point 2

In 2006, Unitika put into effect a set of "whistleblower protection" (internal reporting)regulations, designed to allow employees to immediately report any malfeasance
Unitika Compliance Line
External Legal
Contact point:
or illegal activities they might encounter. As part of this effort, we created two
Help Line
Within CSR/Compliance Group in Personnel/
General Affairs Department
contact points for such reporting, one within the company and one outside thecompany. These are part of the strict measures we use to ensure thoroughReporting Instructions
Reporting Instructions
compliance within the company, driven mainly by the Compliance Committee.
Reporting/
Reporting/consultations
Further, as part of our training in observing compliance using tools like ourCompliance Committee consultations
Feedback Committee chairman: Unitika President
Feedback
company intranet, we regularly dispatch information on these contact points to ouremployees. Over the course of fiscal 2007 such efforts built better complianceawareness throughout the Unitika Group, and made it possible for more
All employees working for Unitika Group
employees to be able to use the system.

Compliance Training
Unitika conducts compliance training at all staffing levels, integrating it into new employees training,
promoted employee training, and managers training. In 2007, along with updating the Unitika Action
Standards, we began implementing compliance training with the goal of boosting employee awareness.
8

Management

Information Management
Information Security

This section outlines our work on information management
and security, which are becoming increasingly important
issues as the growth of the Internet provides ever easieraccess to information.

To maintain the confidentiality of information assets and prevent
unauthorized use, Unitika set up the Basic Policy on Information
Security in 2005. This document contains our Information Security
Declaration and sets forth our steadfast approach to implementing
it, while setting up a management and operation organization driven
by our Information Security Committee. The Basic Policy isdesigned to ensure protection and effective use of the information
we handle in the course of our business activities.

Unitika Information Security Declaration (Preamble Omitted)
1. We will take steps to ensure the security of information as set forth by our Information Security Policy.
2. We will create an information security management organization, and implement it in an systematic manner.
3. We will educate and train our directors and all employees on our Information Security Policy, working to prevent information security
accidents.
4. We will work on improving our information security measures on an ongoing basis.
5. We will comply with all personal information protection laws and all relevant statutes and standards.
* 'Information Security Policy' refers to the documentation set forth and managed by the information Security Declaration, Basic Policy on Information Security, Standards
for Information Security Measures and Information Security Implementation Procedures.

Organization of Information Security Committee
Information Security Committee
Information Security Committee Chairman
Director in charge of Planning and Management Division
Secretariat

Manager
CSR Office Manager

In charge of management information:
Head of Management Planning Department
In charge of personal information:
Head of Personnel/General Affairs Department

Management Information Subcommittee

Personal Information Subcommittee

Chairman: Head of Planning andManagement Division
Members: Head of relevant businessdepartment, head of relevant
management department

Chairman: Director in charge of Personnel/General Affairs Department
Members: Head of relevant businessdepartment, head of relevant
management department

Business departments, management departments

Business departments, management departments

Protecting Personal Information
Unitika established its Regulations for Personal Information
Protection in response to laws governing the protection of
personal information. These regulations consist of thirty-three
detailed provisions pertaining to the collection, use, appropriate

handling, monitoring, and discard of personal information, as
well as penalties attending misuse. The proper implementation ofthese regulations ensured that not a single piece of personal
information was leaked during the whole of 2007.

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CSR Report
Relationships with Clients
Through our product liability and quality assurance efforts, Unitika strives constantly to improve
product safety and quality of our products maintaining customer satisfaction as our first priority.

Ensuring Product Safety
Unitika has established product safety management regulations
designed to ensure that we always offer safe products to ourcustomers.Unitika's product safety management regulations
contain detailed provisions on areas such as basic policy,
responsibility areas, implementation systems, and bylaws on theimplementation and application of manual procedures. Unitika

and Unitika Group companies work to ensure that productmanufacturing and sales are carried out safely, in compliancewith these regulations. The chart below details promotional
system, headed by the Central Committee on Product Liability,
for ensuring product safety.

Central Committee on Product Liability
Committee members

Work areas

Members include the head of each businessdivision, directors in charge of each business area,and directors in charge of management.

Creating basic policy pertaining to product safety
Creating yearly plans pertaining to product safety
Supervising results of product safety reviews
Keeping employees informed on product safety issues

Product Liability Review Board

Product Liability
Review Board

Product Liability
Review Board

Product Liability
Manager

Product Liability
Manager

Established in each business department, section and business unit. The
relevant division head appoints the committee chairman and secretariat.
Committee members
Department (office) heads incharge of production/technology,
department (office) heads incharge of sales, and members
appointed by the division head.

Main work areas
Reviews pertaining to safety issues in
product designs/specifications,manufacturing and distribution
Reviews pertaining to product displays andwarnings
Creating product safety standards andsubmitting revisions or deletions

Product Liability Manager
Appointed by each division head in line with the type of business
Main work areas
Investigating and checking health and environmental effects of product handling anduse
Creating and reviewing product handling cautions for display on product containers,
wrapping and tags
Creating and distributing product safety data sheets

Product Safety Record for Fiscal 2007

shared by the Central Committee on Product Liability and suchinformation is used to prevent from repeated claims.

No product liability–related incidences occurred.
*Information on the claims which may bring about an accident is

Quality Assurance Activities
In order to satisfy customer's demands on our products, theUnitika Group is pursuing quality management system
certification. We are constantly improving our quality assurance

activities based on ISO9001 standards for quality management
systems.

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CSR Report
Relationships with Shareholders & Investors
Based on our "stakeholder-oriented" business perspective, Unitika endeavors to disclose
accurate and timely information to the stockholders and investors at every opportunity. In January
2003, we established a new Investor Relations (IR) Department, which works, as IR/Public Relation
Group, in tandem with the Public Relations Department to ensure that such activities function smoothly,
and to create a meaningful dialog between the company and its stockholders and investors.

IR Activities

Ordinary General Stockholder Meetings
Through explanations of our latest operating conditions and dialogs with shareholders, Unitika uses ordinary generalstockholder meetings as opportunities to deepen understanding of our business conditions and policies.
Announcements of Financial Statements & Explanatory Sessions
Unitika conducts a variety of financial data disclosure activities, including twice-yearly
mid-term and full financial year accounting statements for the press, both of which
are followed a week or so later by explanatory session geared toward institutional
investors and analysts.
Institutional Investor Visits
Unitika representatives make visits to institutional investors and analysts in order toprovide more specific information as needed.

March 2008 Financial Explanatory Session(May, Keidanren Kaikan)

Publications• Financial Flashes (4 times annually, in May, August, November, and February)• Stockholder Reports• Corporate Guides
Website Development
The "To Our Shareholders & Investors..." section of the Unitika corporate website offers an array of public informationof interest to stakeholders.

Share Status(as of 31 March, 2008)
Total Number of Shares Issued: 475,969,000

Distribution of Stocks
Financial Institutions
26%

Number of Shareholders: 70,589
Number of Unit Shareholders: 59,730
Individual, Other
61%

Financial Product Brokers(Securities Companies)
2%

Other Corporations
6%

Foreign Corporations
5%

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CSR Report
Giving Back to the Community
Through beautification efforts, disaster prevention activities conducted with local communities
and volunteers, and various informational services, Unitika works on with the people of thecommunities to protect the environment and build a more ecologically friendly society.

Efforts Toward Environmental Improvement
Building on the success of the Kyoto Protocol, Kyoto Prefecture has created an environmental administrative
organization that includes a system called Eco Kyoto 21. The system targets businesses that protect and develop
Kyoto and the environment. It certifies and registers corporations that play a leading role in environmental
preservation through awareness activities, and in promoting recycling in the local community. Unitika's Uji Plant has
participated in the system from its inception, and in December 2004, was certified and registered under the system's
Ecostyle category for production sites and organizations carrying out highly original environmental activities.

Participation in Local Beautification Activities

Helping Keep the Planet GreenThe Uji Plant is actively involved in volunteer activities to beautify
the surrounding areas. It also participates in the local "Clean Uji"beautification and cleanup campaign, and conducts cleanup
activities of the Uji Plant area three times a year.Other Unitika
production sites are also giving back to the community by

Responding to Japan's increasing focus on public-spirited
volunteer projects, Unitika Labor Union established a volunteer
foundation in 1992 and began a range of activities inside andoutside the Company. In Japan, we have held support activities infacilities for the handicapped and conducted training meetings to
expand the frontiers of volunteer activities. We have also worked tostep up volunteer activities overseas, where we have sent
volunteers to work camps for international exchanges, and haveraised money for disaster relief.
In 2003, Unitika Labor Union celebrated its 30th year anniversary
by starting a program called Midori no Plan ('Green Plan') designed
to give back to the community and raise environmental
consciousness. Midori no Plan volunteers created a wooded area
they named Unitika no Mori ('Unitika Wood'). Three species of local
trees (sawtooth oak, quercus serrata, Japanese cypress) wereplanted in a two-hectare area of mountain forest in Hidakagawa-cho(Wakayama Prefecture). Employees visit the area for cutting backthe undergrowth and pruning several times per year. In September
2007, twenty-three employees performed this task to enable better
tree growth. In June 2007 this project was recognized by
Wakayama Prefecture as "an effort contributing to CO2 absorption
through forestation," and is projected to absorb about 800 tons ofcarbon dioxide from the atmosphere over the next 100 years.
Overseas, in April 2007, one female Unitika employee wasdispatched to Burkina Faso in west Africa to take a post as amember of the Japanese Overseas Cooperation Volunteers.
Working for the Department of Agriculture, Forestry and Fisheries
on projects to promote rural village development, she participatedin activities liketree-planting, environmental
education, and offeringsocial support to local
women's collectives.

The Clean Uji event

beautifying their surrounding environments.
One Saturday in March 2007, about 150 people from the Okazaki
Plant and surrounding community gathered for a volunteer
activities to clean up the area around the facility.
As a member of the Ako City Environmental Preservation Council
consisting of major corporations located in Ako City, Hyogo
Prefecture, on May 30th, 2006 the Sakoshi Plant participated in acleanup of Oshiro Street in front of Ako Castle. In March 2007,
the Sakoshi Unitika Labor Union's Women's Committeesponsored a cleanup of the Chigusa River.

Cleanup around the
Okazaki Plant

The Women's Committee–sponsored cleanupof the Chigusa River banks in Sakoshi

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CSR Report

Disaster Prevention & Readiness Effortss
Unitika has created an organization well-equipped to prevent
production accidents and accidents damaging surrounding areas.
In addition to these basic measures, we are also active in training
activities to prepare for accidents and natural disasters.To makeinternal standards for managing safety at production facilities,
Unitika has established a set of "pre-evaluation policies" on safety
hygiene and environmental effects at new facilities. All new andremodeled facilities are subject to a strict inspection to be carriedout two times, once during the designing stages and later again
upon completion.
Plants that use boilers and other high-pressure vessels arecharged with a law to conduct yearly inspections. However
voluntary self-management systems and specific conditions are
fulfilled or acknowledged by presiding labor standards inspection
office, and such inspections may be extended to once every two
years instead of every year. Two Unitika facilities (Uji and Okazaki)
have earned this acknowledgement.
The Uji Plant was officially recognized by Japan's Fire and Disaster
Management Agency as an outstanding hazardous material plant,
and was presented with a certificate and plaque from the Agency's
director at a ceremony on June 4, 2007. The Uji Plant has chaired
Uji's Hazardous Material Safety Association since its establishment
in 1976. To ensure the safety of hazardous materials, it complies
with Japan's Fire Law to provide maintenance and safety

management for the storage and handling of hazardous material
facilities. It has created a volunteer firefighting team that carries out
training on simulated disaster sites, and has taken part in various
other disaster-readiness activities.
The plant is also active in community disaster-readiness activities
during fire prevention campaigns and Hazardous Material Safety
Week, such as planning street publicity activities and seminars,
and putting up educational posters. These efforts earned the plant
its recent award, giving it official recognition as a model businesssite for its role as an Uji-based hazardous material facility that
actively contributes to ensuring the safety of the residents of the Uji
and Kyoto Prefecture.
On February 29th, 2008, as part of the 2008 "Spring Fire Prevention
Campaign," the Uji Plant established an initial response framework
for its Polymerization section and Nylon Fiber Manufacturing
Division, and about 90 people participated in joint training
exercises with the Uji City Fire Department with the aim of boosting
voluntary disaster consciousness and improving communication
with city fire departments. These exercises used training aids
including an earthquake simulator and burning house structure,
which allowed many people to gain more firsthand and realistic
experience with such events.

Joint firefighting training(Uji Plant)

Joint firefighting training (Uji Plant)

All-factory disaster training(Okazaki Plant)

13

CSR Report

Promoting Regional Environmental Awareness
Unitika provides Terramac and several other environmental
products and services. To publicize them to a wider audience,
we take part in various events to showcase them, and work with
regional environmental organizations to actively promote
environmental activities.
The Kyoto Environment Festival, sponsored annually by Kyoto
Prefecture, was held in 2007 on December 8th and 9th. The
theme this time was "Kyoto Protocol 10th Anniversary Celebration— Escape from Global Warming! Act locally, from Kyoto to theworld!". Unitika's Uji Plant was a main exhibitor this year, andintroduced many of the company's environmental initiatives andefforts.

The Environment Fair is mainly organized by the "Environment
Project Ako", one of the civil organizations, and is held in every
autumn in colaboration with other civil groups concerned in order
to increase awareness of the citizen about environmental issues.
The Sakoshi Plant too, as a member of the Ako City
Environmental Preservation
Council, supported the "Corporate
Products - Environmental Exhibit"
through corporate environmental
contributions and productpromotions.

PET Bottle Recycling
Unitika manufactures and sells a variety of recycled
products bearing the "ecomark," such as UniEcolo,
recycled polyester fibers, and Ecomix, recycled polyester
non-woven fabrics. As part of our efforts toward
environmental protection, we have been developping
such important products for which the demand isincreasing. As a raw material for these, we organized acampaign for recovering used plastic PET bottles, which
are washed and collected by employees from our various
plants and their families. These are collected by our
Okazaki plant and sent to a recycler to be chopped into
usable plastic flakes. This recovering campaign began in
Uji, Okazaki and Osaka, but now has spread to the
Unitika Fibers Headquarters and our Toyohashi, Sakoshi,
Tokiwa, and Tarui where employee participation
awareness is on the rise.

Unitika PET Bottle Recycling System

Recycling
Processor

ECOMIX

Unitika Plants

UNIECOLO

Okazaki Plant

14

CSR Report

Public Relations Activities
Terramac is a biomass material made from a polymer derived
from plants such as corn. To promote and educate the public
about the benefits of our biomass-based Terramac plastic
material, and as part of our corporate CSR activities, Unitika
participated in the "2007 Surprise! 100 Eco Choices" fair hosted
by the Kyoto branch of Takashimaya department store.
Unitika's waterproofing Terramac-based fabric was also used tobind a citizen's edition of the Kyoto Protocol Handbook, which
compiled a variety of declarations and messages about things
ordinary citizens can do to promote ecology.
The exhibit booth displayed a variety of items made from
Terramac, including bath towels, strawberry packaging, andstrainer nets.
Another highlight was a fan decorating workshop at whichchildren enjoyed drawing their own designs on blank Japanesefans with ribs and handles made of Terramac.

Terramac Product Display

Children enjoy decorating Japanese fansmade of Terramac at the 2007 Surprise!
100 Eco Choices fair

Eco-Products 2007
The Unitika Group Exhibits at "EcoProducts 2007"
As in 2006, the Unitika Group exhibited once again at EcoProducts
2007.
The theme this year was "Diet CO2", and Unitika participated withclose-up presentation of how its Terramac product makes it possible
to reduce carbon dioxide emissions. The exhibit highlighted how
Terramac, a biomass-based material, can be made into a variety offilms, sheets, fibers, non-woven textiles, and resins. The booth overall
showed the limitless possibilities for expanding the use of this material
in the future.
The booth itself was even created from Terramac, a choice which,when the booth was dismantled and incinerated for disposal, resulted
in a reduction in carbon dioxide emissions of approximately 250
kilograms compared to if it had been made of petroleum-based
plastics.
Also at the 2007 exhibition, Unitika collaborated with the makers of themovie Earth, then scheduled for a January 2008 release, showing
previews and other promotional materials. Along with enjoying themagnificent spectacle of life on planet Earth presented by this film,
viewers also showed a keen interest in Terramac as an ecologicallyconsiderate material.

15

CSR Report
Concern for Our Employees
Unitika's personnel system is designed to encourage employee self-actualization.
We provide equal employment and work opportunities, and make every effort tocreate accommodating workplace environments.

Personnel System
aptitude they feel they have for their position. The Career Plan
Sheet covers five main areas: (1) the employee's thoughts on
their current position, (2) their own medium- to long-term careerplan, (3) what they want to achieve next in their career (such aswhether they want to be reassigned), (4) their strengths and how
they have been working on achieving their career plan, and (5)comments on their current job position (such as their concerns)
and improvement suggestions in the workplace.Further, (6) we
also confirms whether the employee of certain age would like to
use a reemploymen system.

Personnel Appraisal System
Unitika's personnel appraisal system emphasizes employees'
effort, and is designed to increase the organization's vitality. It isa results-driven system that awards greater benefits toemployees who achieve greater success or tackle more difficult
challenges. A biannual goal management system and annualcompetency evaluation system are used along with our humanresources development program. They impartially evaluate how
well each employee is meeting their goals, and help them set
new goals to develop their abilities. Supervisors meet with each
employee to discuss their evaluation results, ensuring thateveryone receives proper feedback, for better transparency andcommunication.

Rotation System
Unitika is aware of the importance of job rotation in fostering
outstanding human resources. Our practice of periodic job
rotation (especially for young employees) helps employees
improve their abilities by giving them the opportunity to work inseveral departments, and helps us spot candidates to fast-track.

Self-Reporting System
Once a year, at the time of the annual personnel appraisal
employees submit a 'Career Plan Sheet' to self-report how much

Equal Opportunity
Women Employees

Measures Promotion Law," the company is also involved inpromoting male participation in child-care.

Unitika's women employees are valued for their abilities andperspectives. We employ a large number of female employees
and have no gender-biased employment or promotion policies.
Over the past five yeas, 20.8% of Unitika employees have been
women, including many in management positions.

(Employees )Achieving a Work/Life Balance
In the interest of achieving an ideal balance between work andhome life, and also to address Japan's aging society issues,
Unitika fosters a corporate environment that allows employees totake leave for both child-raising and elder care, and in fact,
Unitika offers leave durations for these, and also for care for sickchildren, that are longer than those stipulated by law. Also,
based on Japan's "Next-Generation Child-Raising Support

Taking Leave for Childcare

Employees Taking
Leave for Elder Care

2003

25

2

2004

27

1

2005

17

0

2006

27

3

2007

26

0

Reemployment System
Unitika has a senior employee system that enables employees tocontinue in the same job after reaching the age of 60.
We welcome employees who want to continue working, and in FY
2007, our rehire rate was 61.3%.

16

CSR Report

Human Resource Development
Unitika believes that raising the ability of each employee in theorganization is crucial for achieving high business goals. Human
resource development is therefore an important focus for us. We
approach it through two areas-our personnel system that sets
forth employee work conditions and appraisal methods, andsystems to encourage ability growth, such as ability
development and training systems. Unitika Training Center is the

dedicated training center we have created to implement ourapproach. It is used for several different types of training taken
by a large number of employees. To help employee
self-improvement efforts, Unitika offers a job qualification
assistance system, correspondence courses, and full-time study
courses at universities in Japan. Many of our highly-motivatedemployees are eager to take advantage of these benefits.

Training System (Program) and Number of Students (FY 2007)

1

Training for individual levels (497 students)
1. Training for promoted employees (223 students)
2. Young employee education (274 students)
New employee training, basic knowledge course,
manufacturing department leader development course

2

Specialized education (117 students)
1. Competency improvement training
egal training,
2. On-the-job development education
Supervisor training, business leader training

Employee Mental Health
Since Unitika feels that mental health is an increasingly important
issue for employees as they move up the corporate ladder, every
Unitika employee undergoes mental health training when they
are promoted to a management position. We encourage
managers to be aware of their managerial role and to take careof their own mental health. Managers can use the Hello Kenko

Sodan 24 Service provided by an external EAP (employee
assistance program) provider through an agreement with
Unitika's health insurance union. To ensure mental healthconsultation is readily available, we have created internal andexternal health consultation offices.

Human Rights
The entire Unitika Group is an active advocate of human rights.
Unitika's Standards for Behavior are distributed among
employees with the goal of elucidating the company's policies onhuman rights, and the company also has in place an annual
human rights education seminar attended by all managers andemployees.
To comply with Japan's revised equal opportunity law, we arealso working on preventing sexual harassment, and have set up
sexual harassment consultation offices at each production site toraise awareness and recognition for the problem among all
employees.

Organogram of Human Rights Education Committee
Director in charge of all employee human rights issues

Human Rights Education Advisory Committee

Companywide Human Rights Education Committee

Workplace Human Rights Education Committees

17

CSR Report

Safety & Health Activities
Unitika places top priority on the safety and health of its
employees and builds such efforts into its operations at all levels.
These include efforts to prevent workplace accidents and ensure

comfortable working environments, as well as a Group-widecommitment to healthcare management.

Unitika's Basic Policy for Safety and Health
1. Ensuring safety and health is the foundation for every types of business activities.
2. Ensuring safety and health is the most important obligation of executives and managers at each levelof the corporate management.
3. All employees shall take part in activities for ensuring safety and health.
4. We shall comply with all relevant labor safety and sanitation laws and workplace safety and healthstandards to ensure safety and health.
5. We shall implement an ongoing safety and health management system to ensure safety and health.

To raise employee safety awareness, Unitika creates medium-term

have been working to "spiral up" our safety and health activities, and(three-year) safety and health plans that we have been implementing

continue refining our risk assessment capabilities, with the aim ofsince 1969. Since 1974 we have conducted an annual health andreducing potential dangers to zero. The Ministry of Health, Labor andsafety conference, attended by company directors, management

Welfare, for the duration of 2008 through 2010, has announced it's

staff, and health and safety officers from all Unitika production sites.

"11th Workplace Accident Prevention Plan," and along with thisAs part of our midterm management plan which took effect in 2005

Unitika will plan new measures for its 14th program running 2008–10,(the 13th program running from 2005–07), based on the principles

including continuing efforts to reduce latent labor dangers and offer

regarding our workplace safety and health management system, we

more comfortable workplaces.

Labor safety and health record

Number of work leaves

NumberRate of work leaves

Rate

1.000

8

0.800

6

0.600
4
0.400
2

0.200
0.000

0
'98

'99

'00

'01

'02

'03

'04

'05

'06

'07

Unitika's rate of work leaves in FY 2007 was 0.172, an increase from FY 2006. We willcontinue making improvements to our safety and sanitation activities, aiming to keep
the number of workplace and industrial accidents at zero.

Asbestos Removal
Unitika and Group companies are not involved in the manufacture or

current or former employees who handled asbestos in the past andprocessing of asbestos, nor have been in the past. However, in 1975,

want to check for asbestos-related health problems. As of Marchsome machinery used asbestos insulation. In response to today's

2008, the current number of health problems among current andgreater concern over asbestos, we have established the Asbestos

former employees is shown below. No health problems have been

Action Committee to study actions needed for asbestos, create

reported from residents of areas surrounding production sites orasbestos policies and carry out other Groupwide functions.

Group companies.

As a safety measure, the Committee has surveyed equipment andbuildings using asbestos in production sites and Group companies.

Number of certified industrial accident victims: 3 (2)*Areas that could expose employees to asbestos-laden materials or

Number of victims certified under the Law Concerning
the Relief of Health Damage Due to Asbestos: 3 (3)*generate airborne asbestos have already been removed, sealed off
or enclosed as needed.

*Number in parentheses is number of deaths.

To check employee health, we have offered health exams to any

18Environmental Report

Basic Environmental Policy
Unitika named 1993 an Environmental first year, when we enacted the Unitika Global Environment Charter, consisting of ourpledge, basic philosophy and action guidelines. Since then, we have complied with this Charter to ensure that our corporate
management methods are environmentally aware, working on a range of environmental activities.

Unitika Global Environment Charter
The growth and development of mankind is rapidly altering our planet's air, water and soil, threatening both the global biosphereand our own future, since both must depend on a finite ecosystem. As a corporation with more than a century of businessactivities contributing to the public good, we are highly aware of the demanding conditions now facing the global environment.
The Charter is the declaration of our intention to focus more attention on protecting and helping the environment, making
appropriate environmental action the core of our business activities.

Basic Philosophy
Better living through technology, driven by corporate activities that help humans and nature coexist.

Action Guidelines
Continual awareness of the
global environment

The Unitika Group always considers the effects of our corporate activities on the global environment, following arigorous set of management procedures during product manufacture to prevent harm to it.

Contributing throughtechnology development

We aggressively research and develop technologies to protect and help the global environment.

Using resources andenergy efficiently

We promote efficient use of resources and energy, and recycle limited resources.

Carrying out PR andeducational activities

We organize a large number of PR activities that provide information on protecting and helping the global
environment, and promote a wide range of educational events.

Drawing on the complete
range of Unitika Group
competencies

Following the mandates of the Charter, we draw on our complete range of competencies to protect and help the
global environment.

Medium-Term Environmental PlanFY 2005 was the deadline we set for meeting the four numericaltargets of our third Environmental Plan. While we met two ofthese targets-reductions in industrial waste and energy
consumption-we failed to meet the targeted improvements inthe loss recycling rate in production processes and in ourenergy unit requirement.
We have examined and analyzed the data from our efforts, andapplied it to the fourth Medium-Term Environmental Plan wehave created, which started in FY 2006. More demanding
targets have been set for items that met their previous targets,
and we have renewed our commitment to improve the items
that didn't meet their targets. The targeted improvement in theloss recycling rate in production processes has been set higher
since we have begun full operation of a new thermal recycling

program. While 2008 is the target year, according to the resultsof fiscal 2007, all goals aimed for are forecasted to be achieved
with the only exception of the improvement of energy source
unit.

Goals to Meet by Deadline (FY 2008)
1. Industrial waste 16% reduction (Compared to FY 2004 level)
2. Loss recycling rate in production processes
7.0% improvement (Compared to FY 2004 level)
3. Energy unit requirement

1% improvement per year

4. Energy consumption quantity
10% reduction (Compared to FY 1990 level; deadline is FY 2010.)

19

Environmental Report

History of Environmental Preservation Activities
Unitika's Environmental
Preservation Activity History

Unitika's work on environmental management hascontinued uninterrupted for over 30 years, and willcontinue into the future.

September 1973

Pollution first became a major issue in Japan in 1973. That year, Unitika
created the Environmental Preservation Regulations, making a clear
distinction between environmental measures and outward-directed
production activities, to enable compliance with regulatory andstandards values.
In 1991, we created a new companywide organization called theEnvironmental Preservation Committee, followed in 1993 by the Unitika
Global Environment Charter. That year we began yearly environmental
auditing, establishing the basic direction for our environmentally-aware
management style that has continued to this day. In 1998, we createdthe Unitika Charter of Corporate Behavior, a document that sets forth thebasic action policy needed to fulfill our Unitika Group mission as apublic-spirited corporation. Its first article sets forth our responsibility forenvironmental and safety awareness.
The Unitika Action Standards created and implemented in April 2001
expanded on the Unitika Action Charter by setting forth specific action
standards for Unitika organizations and employees to comply with in theperformance of their routine business activities. The Standard of
Corporate Behavior represent a clear step toward corporate activities
grounded in a mindset of corporate social responsibility (CSR). They
cover areas such as the environment, safety, compliance, andcoexistence with the public good and stakeholders.

October 1991
April 1993
May 1993

May 1994

July 1996
September 1996
October 1997
January 1998
January 1999
October 2000
April 2001
October 2002
October 2002
October 2005

Created and implemented Environmental
Preservation Regulations.
Revised Environmental Preservation Regulations,established Environmental Preservation Committee.
Created and implemented Global Environmental
Charter.
Environmental Preservation Regulations werereborn as Environmental Regulations.
Established Environmental Committee,organization which meets annually.
Started environmental audits (once per year).
(Voluntary audits by each production site andinternal audits by headquarters staff.)
Created targets for first Medium-Term
Environmental Plan (FY 1997 to 1999).
Started publishing Kankyo, our in-housenewsletter on environmental issues.
Started activities aimed at becoming
ISO 14001-certified at our major production sites.
Created and implemented Unitika Action Charter.
Unitika Chemical was awarded ISO 14001
certification (first in Group).
Created targets for second Medium-Term
Environmental Plan (FY 2000 to 2002).
Created Unitika Action Standards.
Published Unitika Environmental Report.
Created targets for third Medium-Term
Environmental Plan (FY 2003 to 2005).
Created targets for fourth Medium-Term
Environmental Plan (FY 2006 to 2008).

ISO 14001-Certified Unitika
Organizations

Unitika has aggressively worked on becoming certified under ISO
14001-the international standard for environmentally-aware
corporate activities. All production sites due to become ISO
14001-certified had done so by May 2003. In FY 2003, we started
activities to help our affiliates obtain ISO 14001, and have been
conducting environmental audits of each company.

April 1999
November 1999
November 1999
October 2000
January 2001
March 2001
March 2001
March 2001
March 2001
March 2001
March 2001

Evaluation of Financing
for Environmental Rating

October 2001
October 2001
October 2001

Unitika has earned the overall
evaluation "a company offering
particularly advanced efforts toward
environmental issues," and in fiscal
2007, we received financing from theDevelopment Bank of Japan for
financing for environmental rating.
This financing was granted in recognition of ourdevelopment of the polylactide-based material Terramac,
which has received widespread attention as acarbon-neutral material, and also for our leading roles inturning the private sector toward lower carbon emissions
and achieving dramatic reductions in CO2 emissions fromenergy sources. As a result of a three-level environmental
screening covering management overall, operations, andperformance, Unitika received the highest rating.

October 2001
October 2001
December 2001
December 2001
December 2001
December 2002
May 2003
December 2003
February 2004
September 2004
June 2008

20

Ad'all Co., Ltd.
Unitika Protec Sakoshi Ltd.
Unitika Sakoshi Plant
U-ai Electronics Corp.
Unitika Textiles Ltd., Tokiwa Mill
Unitika Uji Plant
Unitika Uji Plastic Plant
Unitika Central Research Laboratories
Unitika Fibers Ltd., Uji Plant
Unitika Glass Fiber Co., Ltd., Kyoto Plant
Unitika Environmental Technical Center Co., Ltd.,
Kinki Office
Unitika Okazaki Plant
Unitika Fibers Ltd., Okazaki Plant
Unitika Plant Engineering Co., Ltd., Chubu Office,2nd Business Division
Nippon Ester Co., Ltd., Okazaki Plant
Unitika Environmental Technical Center Co., Ltd.,
Chubu Office
Unitika Tarui Mill
Unitika Textiles Ltd., Tarui Mill
Unitika Plant Engineering Co., Ltd., Tarui Group
Unitika Environmental Business Division
Unitika Textiles Ltd., Miyagawa Mill
Unitika Glass Fiber Co., Ltd., Tarui Mill
Diabond Chemical Co., Ltd.
Terabo Co., Ltd.
Union Co., Ltd.

Environmental Report

Overview of Environmental Impact
Environmental Impact From Business Activities (FY 2007 Figures)
The Unitika Group is aware of the various types of environmental impact caused by our business activities, and we areworking to obtain accurate data on its severity and on reducing it. The diagram below shows the Unitika Group's inputs andoutputs for FY 2007. The transfer and emission quantities of each chemical regulated by the PRTR (Pollutant Release andTransfer Register) Law are shown below.

INPUT

OUTPUT

Atmospheric emissions
SOx: 163 tons
CO2: 470,000 tons (t-CO2)
NOx: 598 tons Dust: 27 tons

Water
58.18 million m3

Waste water
Waste water quantity: 56.55 million m3
COD emission quantity: 272 tons

Energy242,000 KL(crude oil equivalent)

UnitikaGroup'sbusiness
activities

Waste products
Final external disposal quantity: 7,931 tons

Chemicals*
Raw materials

Inter

nal recycling

Emission quantity: 129 tons
Transfer quantity: 36 tons

386,000 tons

15,591 tons

All products
Production quantity: 359,000 tons

External recycling
9,614 tons

*Chemicals requiring registration under PRTR Law

21

Environmental Report
Work on Reducing Environmental Impact
Unitika is minimizing its air and water pollution, and helping curtail global warming. Today's
manufacturing industry is being called on to preserve the global environment, and we are
actively working on environmental measures.

Air Pollution
Since our 2007 Environmental Report, the Unitika Group has added
nine companies, and consequently our certain score in terms of
atmospheric emissions has worsened. That said, it is also true thatmeasures like switching to a natural gas-based cogeneration
system at our Okazaki plant (operational since April 2006) has
resulted in a positive annual environmental influence, and theabolition of diesel power generation at our Tarui plant has helped us
to minimize atmospheric emissions there.
Soot and particulate matter emissions for 2007 were about 10 tons
for Unitika internal group companies, a year-on-year reduction of
31%, although for the Group as a whole emissions of theseamounted to 27 tons.

Dust emissions

Emissions of nitrogen oxides (NOx) and sulphur oxides (SOx) for
the Group overall were 598 tons and 163 tons, down 22% and 5%,
respectively, compared to the previous year.
To continue to step up measures to prevent air pollution, we areworking on meeting our emissions reduction targets. For example,
we are switching from fuel oil to LNG (liquefied natural gas),increasing the use of low-sulfur fuels, increasing boiler combustion
efficiency and improving operation management efficiency toeliminate waste.

SOx emissions

NOx emissions

t

t

t

70

1,400

700

60

1,200

600

50

1,000

500

40

800

400

30

600

300

20

400

200

10

200

100

0

'00

'01

'02

'03

'04

Fiscal year

'05

'06

'07

0

'00

'01

'02

'03

'04

'05

'06

'07

0

'00

Fiscal year

Unitika Domestic Plants & Internal Group Companies

22

'01

'02

'03

'04

Fiscal year

External Group Companies

'05

'06

'07

Environmental Report

Water Pollution
Chemical oxygen demand (COD) emission of 272 tons in fiscal
2007 represented a 16% year-on-year increase that resulted fromthe addition of nine companies to the Unitika Group. Similarly, total
wastewater emissions also increased by 7% to a total of 56.55
million tons. Water input for 2007 was 58.18 million tons, but the
majority of this was from river and groundwater supplies. Water

resources used were then treated and monitored for quality before
being released back into rivers or the ocean.
In order to reduce COD emission independently from production
volumes, we will work on developing new technologies, improving
management of emissions sources, and recycling and reusing
cooling water.

COD emissions

Total waste water quantityt500

Millions of tons

7,000
6,000

400

5,000
300

4,000

200

3,000
2,000

100
0

1,000
'00

'01

'02

'03

'04

'05

'06

0

'07

'00

'01

'02

'03

'04

'05

'06

'07

Fiscal year

Fiscal year

External Group Companies

Unitika Domestic Plants & Internal Group Companies

Waste Products
Unitika's Fourth Midterm Environmental Plan calls for a 16%
reduction in waste generation between fiscal 2004 and 2008. Whilewaste generation for fiscal 2007 was up 17% year-on-year, to 79.31
million tons, this increase can be attributed to our addition of 9companies to the Unitaka Group. An evaluation using the same
standards as the previous year in fact shows a 17.7% reduction
compared to 2004, a success achieved by each plant site making
steady efforts on a daily basis to reduce waste generation. Our next
midterm environmental plan will continue to build on these efforts,
setting similarly high goals for waste reduction.

portion of plants making efforts to improve manufacturing
processes to boost materials recovery and reuse rates. Comparing
recycle rates using the previous standards, we in fact see an overall
7% improvement compared to 2004, which succeeds in meeting
the goals of the Fourth Midterm Environmental Plan. From now on
Unitika will work to improve recycling rates for the Group overall,including our eight external companies.
Regarding our handling of used fluorescent tubes, the presence of
mercury and other substances in these fixtures has always
presented difficult challenges for recycling and disposal. Startingfrom October 2007, however, a portion of Unitika plants have been
taking advantage of Matsushita Electric Company's "Akari Anshin
Service," through which Matsushita leases its fluorescent tubes andthen collects the used tubes for recycling.

Recycling rates showed a worsening trend compared to the 2001
base year, but by 2004 these rates had begun to turn around, andthis year improved slightly year-on-year to 93% including Unitika'seight external group companies. This was the result of a certain
Quantity of processed industrial waste products

Rate of recycling%t
10,000

100

8,000

80

6,000

60

4,000

40

2,000

20

0

'00

'01

'02

'03

'04

'05

'06

0

'07

Fiscal year

'01

'02

'03

'04

'05

Fiscal year

Unitika Domestic Plants & Internal Group Companies
External Group Companies'00

Average Including External Group Companies

23

'06

'07

Environmental Report

Handling of Chemical Substances
The Unitika Group maintains a policy of quantitatively managing
chemicals and substances thought to be hazardous to humanhealth, as set forth in regulations like the Occupational Health and
Safety Law and the Basic Environment Law, and at each of ourplants these substances are strictly controlled.
The PRTR (Pollutant Release and Transfer Register) Law is asystem for understanding and reporting on the amounts ofemissions and wastes emitted by or transported out of factories. In
fiscal 2007, the Unitika Group reported on its emissions and transfer
of 23 substances. Chemical substances requiring notification andthe amounts Unitika reported for the main items among these areshown below.

Number of chemicals requiring registration under PRTR Law: 23
Acetaldehyde

Toluene-caprolactam

Antimony and its compounds

XyleneHexamethylene diamine

Asbestos

Cobalt and cobalt compounds

1,2,4-benzenetricarboxylic acid 1,2-anhydride

Bisphenol A

1,4-dioxane

Boron and its compounds

Bisphenol A epoxy resin

Dichloropentafluoropropane

Poly(oxyethylene) = alkyl ethyl

Ethylene oxide

Dichloromethane(Methylene chloride)

Poly(oxyethylene) = nonylphenol ethyl

Ethylbenzene

N, N-dimethylformamide

Methyl methacrylate

Ethylene glycol

Terephthalic acid

Release and Transfer Amounts for PRTR Law-Regulated Substances in Fiscal 2007
Substance(annual tons)

Atmosphere

Water

Total Amount of Emission

Transfer AmountAcetaldehyde

6

2

8

-

Asbestos

-

-

-

2

-

-

-

2

-caprolactam

14

-

14

-

Dichloropentafluoropropane

2

-

2

-

Dichloromethane(Methylene chloride)

71

-

71

12

Bisphenol A

-

-

-

1

21

-

21

17

Boron and its compounds

-

8

8

-

Poly(oxyethylene) = alkyl ethyl

-

3

3

1

Other

-

2

2

1

Unitika Domestic Plants &Internal Group Companies Total

92

11

103

20

22

4

26

16

Terephthalic acidTolueneUnitika External Group Companies Total

Due to the addition of nine group companies, in 2007 chemical
substance emission amounts for the Unitika Group as a wholeincreased by 31 tons over the previous year. However, our full
implementation of a system for collecting and reusing organic
solvent has resulted in a dramatic reduction in transfer amounts.
We are committed to setting voluntary limits reductions in pollutant
release and transfer, including investing in environmental protection
facilities and improving processes to optimize our operations whileat least maintaining or even reducing our environmental impact.

PRTR Law Amounts Handled & Emission/Transfer Amounts
230

300

220

250

210

200

200

150

190

100

180

50

170

0

160

'01

'02

'03

'04

'05

'06

'07

Amounts Handled (1000s of Tons/Year)

Release/Transfer Amounts (Tons/Year)350

HandledTransfered
EmittedFiscal Year

24

Environmental Report

Energy Saving & Global Warming
The Kyoto Protocol was adopted at COP3 (3rd Conference of theParties) to achieve the goals of the United Nations Framework
Convention on Climate Change (UNFCCC) and first year of the first2008 to 2012 cycle of this Protocol is about to begin. Further, at theLake Toya Summit held in July 2008 for establishing the post-Kyoto
framework, the attending parties agreed to aim to reducegreenhouse gases by half their current levels by 2050. With suchagreements gaining a foothold, manufacturers in particular must
continuously strive to reduce their emissions of CO2, one of themost important greenhouse gases, as well as energy saving.
With these waves of change spreading across the world, Unitika,
too, is committed to taking accurate accounting of its own energy
consumption and endeavoring to save energy and reduce CO2
emissions.
Our Medium-Term Environmental Plan targets an energy
consumption reduction of 10% by 2010 (compared to the FY 1990
level).
For 2007 our energy use was increased by 19% year-on-year due
to the addition of nine new group companies to the Unitika Group,
however this still represents an 11% reduction compared to 1990.

Energy consumption quantity(crude oil equivalent)This success is mainly the result of steady energy-saving activities
such as reducing Groupwide production volumes, process
improvements, heat recovery and water reuse. And, our energy unit
requirements did not changed significantly in 2007 compared to theprevious year. Since some products do not lend themselves tobeing measured by weight against energy units, the energy unit
differs from the amount of energy used and statistically the items
are the same as the previous year.
Our CO2 emissions were increased by 20% year-on-year due to theaddition of nine new group companies. However this still represents
39% reduction compared to 1990. In addition to dropping ourenergy consumption, this decrease was also contributed
significantly to the installation of gas cogeneration systems in our
Uji and Okazaki plants, as well as a switch from oil to natural gas at
our Sakoshi plant.
We will continue to work on preventing global warming from an
all-encompassing perspective, examining various indicesthroughout the manufacturing process.

Changes in CO2 emissions from energy generation(based on CO2)

Thousands of k
300

Thousands of tons

250

600

200
150
500

100
50
0

'00 '01 '02 '03 '04 '05 '06 '07
Fiscal year

400

Energy unit requirement(indexed to FY 1990 level=100)

300

120

200

100
80
60

100

40
20
0

0

'00

'00 '01 '02 '03 '04 '05 '06 '07
Fiscal year

Unitika Domestic Plants & Internal Group Companies

25

'01

'02

'03
'04
Fiscal year'05

External Group Companies

'06

'07

Environmental Report

Reducing Greenhouse Gases by Changing Energy Fuel Sources
In addition to reducing our overall energy consumption, as theUnitika Group we have also dramatically reduced our CO2 output
through a two step of change in energy fuel sources, first from coal
to heavy oil, then from heavy oil to natural gas.
In 1990, the year now used as the standard year for greenhousegas reduction, nearly 30% of greenhouse gas emissions have been
generated by use of coal as a energy source. In 1995, however, wechanged the energy source by our Uji plant's in-house power
generation facility from coal to heavy oil.
Then, between 2004 and 2006, we installed natural gas

cogeneration systems at both our Uji and Okazaki plants andchanged the energy source for these from oil to the much lessenvironmentally burdensome natural gas. As a result, on a CO2
generation basis, our reliance on natural gas as an energy source
went from 2% in 2003 to 55% by fiscal 2007. Through this two-stepchangeover in energy fuel sources, assuming 1990 levels as
representing 100%, by 2007 we had radically reduced ourgreenhouse gas generation to 61%. These efforts had the additional
benefits of reducing other environmental pollutants including oxides
of sulphur (SOx) and ash and other particulates.

Purchased electricity
Natural gas
Coal
Unitika Group's CO2 emissions generated by energy sources
CO2 emissions (in 1000s of tons)

Oil
Energy usage

Energy usage (in 1000s of KL)

900

300

Including 9 additional
Group companies

800

270

700

240

600

210

500

180

400

150

300

120

200

90

100

60

0

'90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07
Fiscal year2630Environmental Report

Logistics
To reduce the environmental impact of transportation needed for inputs of raw materials and outputs of products and waste products, Unitika
implements the four logistic guidelines shown below. These guidelines have helped us make across-the-board improvements in transportation
efficiency, and in reducing energy consumption and emissions gases.

We will shorten transport distances by lending, borrowing or swapping general-use products or materials of equal quality with other companies.
Within Japan, we will use container transport by sea or rail whenever possible, since these methods enable mass transport and are energy-efficient.
Forklifts used for work inside sites will be changed from engine-driven models to environmentally-friendly battery-driven models with zero emissions
gases and low noise.
We will reduce transportation energy consumption by using flexible containers that can wrap larger numbers of products instead of paper bag
wrapping materials, and by shaping containers for more efficient truck loading.

In line with an April 2006 revision to Japan's laws pertaining to rationalized energy consumption, we have started energy-saving initiatives forlogistic.
In FY 2006, Unitika and Unitika Group companies were registered as the designated shippers for a total freight transport volume of 107,654
thousand ton-km, resulting in a CO2 emissions volume of 36 thousand tons (t-CO2).

Environmental Complaints
Based on Unitika's corporate vision of "being a company that
contributes to people's lives and the environment, and that has apositive presence within society," we make utmost efforts to pursue
our business and activities in ways that are considerate of thepeople living around us. Despite these efforts, in fiscal 2007 we still
received a number of complaints regarding noise, industrial odors,
and other incidences of environmental disturbance.
In each case, we looked to find both causes and solutions andcommunicated these to those in the surrounding communities while

taking steps to ensure their non-recurrence. In all such situations
we will do our utmost to improve so that we may contribute
positively to the living environments of the people living around us.
Further, in fiscal 2007, for Unitika and the Unitika Group, there were
no incidences of accident or pollution that might have led toenvironmental problems, nor were there any violations ofenvironmental laws and regulations.

Complaints from Surrounding Neighborhoods
Offensive Odor
No. of Incidences
7

Noise
Water Quality

6

Air Quality

5
4
3
2
1
0

'00

'01

'02

'03

'04

Fiscal year

27

'05

'06

'07

Environmental Report

Environmental Accounting
Method of Tallying Environmental
Accounting Data

The Unitika Group implements environmental accounting
as part of our environment-conscious business activities.
In conducting our environmental accounting, we follow the2005 edition of the environmental accounting guidelines
published by the Japanese Ministry of the Environment in
May 2005.Unitika will continue to release clear andaccurate environmental accounting data.

Data provided by : Unitika Domestic production sites & InternalGroup Companies and Union Co., Ltd.
Applicable period : April 1, 2007 to March 31, 2008
Co

Purpose of Environmental Accounting
Environmental accounting is carried out during environmental
preservation work. It is designed to make environmental
preservation more efficient by quantitatively identifying andmeasuring the amounts of investments and expenses forenvironmental preservation, and to make decision-making
processes in a more reasonable way.
Disclosing environmental accounting information to the publicfulfills our responsibility to keep stakeholders informed, andprovides us with the feedback needed to step up our work on
environmental preservation.

s

t

s

: Investment amounts include theenvironmental investment on items forwhich the environment is not the main
objective. Expense amounts include
labor costs, general expenses anddepreciation.

Unitika's fiscal 2007 environmental investment was 358 million yen.
Most of these funds were used on items related to lightening theenvironmental burden and recycling chemical substances.
Environmental expenses were 2.593 billion yen, mainly for waste
processing (including recycling expenses), maintenance andmanagement of equipment to prevent pollution, and product R&D
for environmental preservation.

Environmental Preservation Costs
Category(Millions of yen)

Capital investment

Cost

272

762

Pollution (water, air and noise pollution) prevention measures

74

Energy saving, global warming prevention

86

1,096

Waste disposal, recycling

Upstream/downstream costs

146

Packaging material recycling

Management activity costs

91

Environmental management system maintenanceenvironmental education, impact monitoring

Pollution prevention costs
Businessarea costs

Environmental preservation costs
Resource recycling costs

Remarks

R&D costs

359

Developing environmentally-friendly products

CSR costs

38

Forestation improvements, beautification campaigns

Environmental damage costs

27

Quantity-based tax on environmental impact of SOx emissions

Total

358

2,593

Economic Effects(Millions of yen)

The table illustrates economic effects by listing items with a clear
basis for calculation, that have high substantive benefits forenvironmental preservation. The expenses saved from Unitika's FY
2007 energy-saving and waste reduction activities, and the amountof sales generated from recycling resources have been calculated.
Note that inferred benefits have not been calculated, such as
savings to the public from environmental preservation efforts.

Item

28

AmountReduction in energy expenses

24

Reduction of costs associated with energy-efficient powersources and industrial waste reduction

3

Income from sale of recycled resources

243

Environmental Report

Unitika's Environmental Efforts

from the Unitika Okazaki Plant
Shioli Kutsuna, Unitika's charming "mascotgirl," isreally interested in Unitika's environmental efforts,and here she gives us her first report on what she's found.
Some of these issues are complex, but she's done some legwork for us andtalked to some people in the company who can tell us
what it's all about in layman's terms. Let's see what she-and they-have to say!
also shape them with different cross-sections, forexample triangles, tubes, or whatever shape is needed.

Shioli's First Interview Report--------------------

Hi, I'm Shioli Kutsuna, and I'm here at Unitika's Okazaki
Plant to find out what's going on with environmental
efforts here. I don't really know what to ask yet, but I
think it will go well....

Unitika: Next let's go to where we bundle these filaments
together and draw them into long, and strong filament
yarns.

Unitika: Don't worry, Shioli, I'm sure you'll do great! Let's get
started!
--------------------

Okay then! So, first of all, this plant seems very large.
How big is it, actually?

----------

Wow, that's pretty big. You'd better start showing mearound now, or we'll never finish by the end of my visit
today.

Fibers Made from Recycled PET Bottles
Unitika: Here we make fibers with these facilities called
UniEcolo, using empty PET bottles.

----------Ah, I see how you've collected all the empty plastic
bottles and are shredding them into flakes, right?

Unitika: Exactly. Then we melt the flakes and spin the molten
plastic into filaments by forcing it through special tiny
nozzles. Watch....
----------

But why would you go to
the trouble of making
them so nice and long,
but then cut them into
little pieces?

Unitika: This kind of reclaimed
staple fiber can beused much like cotton,or spun into textiles
to make uniforms
and things like that.

Unitika: You're right, so start here, in the part of the plant where
we make fibers from recycled materials.

----------

I see, you spin the fibers to make thicker filaments
strong enough to use in clothing fabric, yes?

Unitika: Not only for clothing, though; we also cut them to makestaple fiber, which is used to make composite fabrics.

Unitika: It's big alright. It's about 30,000 square meters, orroughly the same area as six Nagoya Dome's.
----------

Different shapes? I never knew you could do that!

I see. So, exactly
how many PET bottles
do you turn into thiskind of recycled
polyestel fiber here?

Unitika: Every day we recycle the equivalent of about 600,000
500-ml bottles. That's about 220 million a year.

Oh yeah, I see them! Hey,
that's cool!

----------

Incredible!

Unitika: Yes, and these PET bottles can be used not only forrecycled polyestel fiber, but also for spunbond.

Unitika: These filaments
are extremely fine,
about 1/100th thewidth of a humanhair. And eventhough they'reso thin, we can----------

Spunbond.... What's that?

Unitika: Well, let me show you. Let's go to the spunbond sectionof the factory.

29

Environmental Reportfrom the Unitika Okazaki Plant----------

This is how they make "spunbond" non-woven fabric! Check it out!
----------

So, apparently this is where they make spunbond. But
what is it?

More people should use Terramac!

Unitika: Spunbond is our technical term for a non-woven fabric.
----------

Unitika: Here we have the manufacture of one of Unitika's mostrepresentative "eco" products, "Terramac."

How do you make a fabric without weaving?

Unitika: Good question. You see, making fabric by processing
the weaving yarns takes quite a long time and effort.
The spunbond process simply passes melted resin
through tiny holes, forcing it into filaments, which thenstick together and can be fashioned into a sheet. It's avery fast and cost effective way to make fabrics thatcan be used for many different purposes.
------------------------------

Like what?

--------------------

From raw garbage?! Now THAT would be true
recycling!

Unitika: Terramac itself is actually a very good example ofrecycling, because eventually it decomposes into waterand carbon dioxide, and the latter can become part ofthe life cycle of corn, which can then be made into more
Terramac, and so on.

And all that can come from recycled PET bottles?

----------The photosynthesis cycle. I remember learning aboutthat in science class.

Unitika: Yes, the fact that the carbon dioxide generated will bebreathed in by new plants means that Terramac itself isconsidered "carbon neutral," meaning that it does notcontribute any extra CO 2 to the atmosphere.

I had no idea PET bottles could be used in so manyways.

----------

So you even recycle scraps from the recycledmaterials!

Unitika: Yes. And let me tell you about another thing-a lot ofthese PET bottles are actually gathered from Unitika
employees, who are involved in our program to collectthem here at the Okazaki plant.
----------

These come from corn?

Unitika: Not only corn, but other starchy plants like potatoes andsweet potatoes. We've also started researching how wemight extract polylactide from other materials like raw
garbage, waste wood pulp, and sludge.

Unitika: At the spunbond factory headquarters, all the scraps
and cuttings that are not used to make products arerecycled once again, about 20 tons a month.
----------

I did a calendar shoot once where I wore a garment
made of Terramac. That's how I found out about it andwhat a wonderfully environmentally excellent material it
is. And this is where you make it!

Unitika: Yes, and here we see the raw material, chips of a
substance called "polylactide."

Unitika: Yes, our spunbond material is called "Ecomix" and ismade with at least 51% recycled PET bottles,
sometimes more. One of Ecomix's main uses is tostabilize foundations and help solidify the earth inengineering and land reclamation projects.
----------As I understand it, Terramac is made from corn, andalso happens to be biodegradable.

Unitika: You are well informed!

Unitika: Such fabrics are usedin all sorts ofways, often in
the backgroundof our daily lives,
for example indisposable
diapers, hand
towels,agricultural
sheeting, civil engineering projects, and as industrial
materials for various applications.
----------

Ah, very clever. So even that can be considered an "eco"approach to things, not spending extra energy totransport recyclables!

So everyone in the Unitika Group is actually doing alittle something for recycling and the environment. But
hold on, doesn't it cost a lot of money to transport all
those plastic bottles?

Unitika: Actually we don't have any extra trucks assigned tohaul them. We use trucks that would already be
traveling anyway between the various Unitika facilities,
and simply load the bottles on whenever there's a little
extra space.

30

I see. So that means the replacing of crude oil-based
plastics and films with Terramac would help reduce theamount of CO 2 released into the earth's atmosphere!

Environmental Reportfrom the Unitika Okazaki Plant

Unitika: That's right, polylactide-based plastics help us
remarkably reduce CO 2 emissions compared toconventional petroleum-based plastics.
----------(Shioli, in the control room, moves to touch a switch....)

So that must help reduce global warming. So, how is
Terramac used?

Unitika: Hey, hey, no touching! Just looking, okay?

Unitika: Oh, in lots of things-garbage bags of various kinds,
heat-resistant food containers, tea bags, towels,clothing, cell phones, office equipment, and manyothers.
--------------------

Unitika: Indeed, this is theheart of thesystem righthere.

So might be using Terramac myself, without evenknowing it! It seems like a really diverse material, thisTerramac, and I hope it starts getting wider use inJapan, no, around the world!

----------

I see, and I
bet it's a big
job keeping it
in good orderand running
properly everyday.

----------

Well, thank you for showing me around today. It was thefirst time for me to visit a factory like this, and half thetime it was so exciting that I felt like I was in a scenefrom Charlie and the Chocolate Factory. Just one
manufacturing process after another, I could hardly tellwhere I was.

Getting energy from natural gas and steam
Unitika: Let's finish by introducing our natural gas-powered
cogeneration system.
----------(Looking up) This would be that? It's so big....

Unitika: In 2006, here at the Okazaki plant, we worked with Toho
Gas Co. to install this cogeneration system.
----------How does it work?

Unitika: We used to make electricity by burning oil as a fuel, butwith cogeneration we use a combination of the city gas
and the steam we generate at the factory to cover a lotof the electrical needs we have.
----------

Unitika: And I trust you got to know a little more about what we
do at Unitika for the environment?

Steam into energy. That sounds environmentally friendly.

Unitika: Yes, it eliminates the sulphur oxide emissions typical ofburning fossil fuels, and by using fuel more efficiently
we get about 18% better energy savings, not to mention
a 26% reduction in CO 2 .
----------

Sorry. I was just so amazed that such a big machine
could be controlled by this one little computer!

----------

That's awesome! You've really come up with someclever ways to save energy here at the Okazaki plant!

Yes, and it puts it all into perspective seeing the raw
materials and all the things made from them, even the
manufacturing processes themselves and how energy isused. All together I think it does a little to help theenvironment. Very impressive!

Unitika: We do what we can, every day of the year, little bylittle....

Unitika: Let me show you the cogeneration system control room,too.

----------

As you might know, I grew up in Australia, whereenvironmental preservation is really ingrained in people
in general. My mother is very active in such things, too.
I've always known about separating the rubbish into
recycling and non-recycling and that sort of thing, butfrom now on I'm sure I'll be a lot more active in finding
ways to be more environmentally friendly-just like
Unitika!

The End31

Environmental Report
Technology and Products for Environmental Safety
Unitika offers various products and technologies using a basic approach that aims to create
sustainability through resource recycling.

Water Treatment Facilities
Water supply facilities
Advanced water supply treatment facilities
Advanced sewage treatment facilities
Agricultural community waste water treatment facilities
Seepage water treatment facilities in final disposal sites

Industrial waste water treatment equipment
Sludge reduction equipment
Water supply membrane filtration equipment
Sewerage facilities
Granular desphosphorizing equipment

Improved Combined Sewerage
Treatment System

Fishery community waste water treatment facilities
Waste water treatment facilities in garbage incineraters
Sewage treatment equipment
Sludge composting equipment

MarimoHigh-Speed Filtration System

Since large volumes of combined sewage flows into sewage
treatment sites in a short time when it rains, the sites can't treat it
fast enough, and untreated sewage is released into rivers or otherwaterways. To solve this problem, Unitika has developed an
improved combined sewerage treatment system driven by ourMarimo high-speed filtration system, enabling rapid and stable
treatment over short amounts of time. It
efficiently performs variable high-speed
filtration on top/bottom counter-currents,
providing high treatment capacity in rainor shine. It removes pollutants at a
filtration rate of up to 2,000 m/day inrain, and at a standard rate of 1,000
m/day in clear weather. It is ahigh-performance system offering stable
treatment capacity at a low cost.

Marimo is a high-speed filtration system developed by Unitika
that offers high performance and uses a special fiber as thefiltration material. Marimo's high-speed function provides afiltration rate five times faster than conventional sand filtration
systems. Offering a significantly higher level of treatment
efficiency, it enables easy cleaning and draws on Unitika's
many years of expertise as a fiber manufacturer. Marimo isused in a wide range of applications intertiary waste water treatment, waste
water reuse, industrial water
filtration, andmanufactured water
pretreatment.

Sludge Reduction Equipment
To enable the type of sustainable industrial processes that will
ensure the future of mankind and our planet, Unitika hasdeveloped equipment to reduce the volume of sludge
generated when treating biological materials. The equipment
continuously mills the excess sludge
generated in biological material
treatment tanks using fine ceramicbeads. When the milling
has solubilized thesludge, it is fed backinto the biologicalmaterial treatment tankto biodegrade.

Marimo filtration material

Biological Contact Filtration Facility
A clean water facility that uses spherical carriers of polyester
fiber as the filtration material. Biological membranes form on
the surface of the filtration material, and microbes such as
nitrifying bacteria and iron oxidizing bacteria propagate within
the filter layer. The biological purifying properties of thesemicrobes efficiently
remove ammoniacal
nitrogen, iron andmanganese. The facility
can fit within a small
footprint and has a highpure water treatment
capacity.

Fine ceramic beads

Phosnix Granular Desphosphorizing System
A system that recovers phosphorus
in waste water as granules ofmagnesium ammonium
phosphate (MAP), a
substance that can beeffectively used as afertilizer.

Kita Koriyama water purification facility

MAP

32

Environmental Report

Garbage Processing Facilities
Stoker incinerators
Gasifying-melting furnaces
Garbage crushing and sorting facilities
Exhaust gas treatment equipment

Exhaust gas treatment equipment
Regenerative-heat deodorizing equipment
Fluid-bed incinerators

Incineration residue melting furnaces
RDF (refuse-derived fuel) facilities
Fly ash treatment equipment

Next-Generation Stoker Incinerator:
Uniburn System 21

Advanced-Function Incineration Residue
Melting System: Unimelt System 21

Unitika started constructing city garbage incineration facilities
in 1971, and has now built 90 facilities. Uniburn System 21 is anext-generation city garbage incineration system that draws
on these many years of experience, developed with the aid ofGerman technology for stoker incinerators with boilers. Its low
air ratio and high combustion temperature improve the heatrecovery rate and enable significantly cleaner exhaust gas.
These features reduce environmental impact and lower total
garbage processing cost.

Developed as the result of our research on reducing and cleaning
incineration residue, the Unimelt System can melt incinerator ash,
fly ash, incombustible residue left after processing bulk garbage,or incombustible residue mixed in with combustible residue. Waste
plastic that previously couldn't be reused can be melted together
with other garbage, making the system effective for plastic thermalenergy applications. Unimelt is a revolutionary system that enables
residue to be cooled into slag after melting, for effective use as aconstruction material. Unimelt can also melt items processed atlandfill disposal sites, enabling recycling at those sites.

Eco Slag Center at Tottori Prefecture's Greater Western Area
Administrative Management Union

Yachimata City Clean Center

Air Pollution
Deodorizing equipment
Soil surveys/analysis
Pollution cleanup measures

Dust collection equipment
Soil pollution cleanup measures
Pharmaceutical products, resins, filtration materials

Environmental Surveys, Measurement
and Analysis:Unitika Environmental
Technical Center Co., Ltd.
Unitika Environmental Technical Center (UETC) uses the latest equipment
and technology to carry out environmental surveys, measurement andanalysis, along with various investigations needed by several industries.
UETC is certified by Japan's Ministry of the Environment as a qualified
contractor for dioxin analysis, and has gained a reputation for solid
reliability. To enable more accurate analysis, UETC can analyze trace
amounts of dioxins. It is highly experienced in soil surveys (a recent area ofconcern in Japan), and has measures to combat soil and groundwaterpollution permanently. UETC also helps protect living environments throughactivities such as sick building surveys; air quality, weather, noise andvibration measurements; technical support for water treatment; exhaust gas,odor and work environment measurements; and analysis of river water,
waste water, drinking water, asbestos, and insulation oil trace PCBs.

33

Environmental
hormone analysis

xtracting a sample witha simple boring machineEnvironmental Report

Recycled Polyester Fiber
Uniecolo
PET bottle recycling process

Demand for PET bottles has been growing year by year, and thecost of fossil fuel-based plastics is rising sharply. For that reason,
used bottles have become an important resource themselves. As
part of our efforts to preserve the environment, Unitika has been
active in PET bottle recycling. Uniecolo was developed through ouroutstanding spinning technology. Offering soft hand-feeling andgood bulkiness, it is an environmentally-aware fiber with the samefeatures as conventional polyester, and designed to enable reuse oflimited resources.

PET bottle recovery.

Removal of impurities such as caps and labels.
Cut into small flakes.

Heated into chips.

Drawn out to filament yarn.
Made into staple fiber.

Made into yarn by spinning.

Made into fabric by knitting or weaving.
Cut and sewn into product.

New Natural Fibers
Sylph
Good clothing materials need to be gentle, comfortable andversatile, while enabling attractive tailoring. Materials must meet allthese requirements to make novel and comfortable clothing, andUnitika's groundbreaking new material Sylph generates just suchnew possibilities. More than ten years after the development oflyocell fiber (the raw stock fiber), Sylph was created by using amore evolved form of the raw stock fiber and the latest advanced

Fiber category

fabrication technology. Sylph offers a larger variety of highadded-value materials, and raises the standard of quality for lyocell
products. And since it is also extremely environmentally friendly,
Sylph is setting the new standard for materials meeting 21st-century
needs.

Cotton, hemp, others

Recycling/manufacturing process not generating harmful substances
Natural fibers

Viscose,othersRecycled
cellulose
fibers

Pulp
Plant fibers

Mix

Dissolving

Solvent
fiber spinningcellulose
fibersRestoredSylph
Semi-synthetic
cellulose
fibersAmine oxide
distillation

Acetate, triacetate, others

34

Spinning

Cleaning, bleaching,dryingRecovery

Dilute amine oxide
recovery

Lyocellraw stockEnvironmental Report

Recycled Polyester Nonwoven Sheeting
EcomixRecycling scraps of PET bottles and nonwoven fabric products

Since recycling is an important part of our environmental
preservation efforts, Unitika has developed, by its outstanding
spunbond technology, a polyester filament nonwoven fabric called
Ecomix, made from scraps of PET bottles or nonwoven fabricproducts. Ecomix has already obtained the Japan Environment
Association's Eco Mark certification (No. 00105029). With
outstanding water permeability and endurance, Ecomix has been
approved for a wide range of public works applications, including
protective mats for water barrier sheets in waste disposal sites,
sheets for erosion and torrent control in banking reinforcement
construction and harbors, suction-preventing sheets for riverbank
protection, and plastic board drains. With its cost-effective wide
sheets and highly elastic structure, Ecomix can easily handle
warping and projections, and is gaining popularity as sheeting fortoday's needs.

Nonwoven fabricproduct scrap recovery.

PET bottle recovery.

Removal of impurities
such as caps and labels.
Cut into fine fragments.

Cut into small flakes.

Heated into chips.

Activated charcoal is mixed into chips,
which are spin-drawn to yarn.
Made into sheet, hot-rolled to melt.

Finished nonwoven fabric sheet.

Anticorrosive Sheeting
Segurova
Japan's River Law was partially revised in June 1997, and in linewith the new law, Unitika Fibers developed Segurova, ananticorrosive sheeting material designed with the concern to naturalenvironments and landscapes. Manufactured using a 3-D weaving
technology to ensure that gaps and thicknesses are kept constant,Segurova resists water currents, and provides high corrosion
resistance. Designed for weather resistance and endurance, it ismainly comprised of black clope-dyed polyester monofilament. To
give some components partial dimensional stability, they use binder
fibers with a core and pod structure. The sheet top and bottom
layers have a honeycomb structure for easy filling with earth or
sand. Segurova can be used in embankment protection works toreinforce the corrosion resistance of herbaceous plants such as
lawns or seedlings. It stops corrosion by water currents atembankment surfaces and river banks, realizing a new
anticorrosion sheeting-based construction method. Segurova has

already become the first product in the industry to be awarded the
Public Works Research Center's Anticorrosion Sheet Performance
Evaluation Certification (certification No. 0001).

35

Environmental Report

Plant-Derived Biomass Material
Terramac
Terramac is a biomass material made from a polymer derived fromplants such as corn. Biomass materials are organic resources derived
from sustainable biological sources except for fossil resources.
Terramac ultimately degrades into carbon dioxide and water, which areabsorbed into plants such as corn for their growth. Then, the corn canbe turned Terramac again. So Terramac is part of the world's natural'recycling system'. Conventional plastic products are made from oil, alimited and non-renewable raw material that will run out in the
not-so-distant future if we continue using it. Terramac is now an
extremely promising alternative. It has a wide range of applications inclothing, plateware, cups, wrapping films, cosmetic bottles, teabags,
planters, trash bags and all areas of consumer demand.
Unitika has developed heat-resistant foam containers and foodcontainers made of Terramac, which base ingredient is polylactic acid.
These containers are the world's first polylactic acid products that canhold hot water inside and are microwave-safe. One of Terramac's
applications is for use in mobile phone casings, which require
demanding durability and heat resistance specifications. Recently, we
have developed new heat-resistant polylactic acid resins for injection
molding. These resins can be molded at lower molding die temperaturein less molding time compared to our previous heat-resistant grade
Terramac. We have succeeded in greatly reducing environmental
impact during molding of polylactic acid by developing this newheat-resistant grade polylactic acid. Combining the natural advantagesof plant material with human technology, Terramac is an attempts to be
the ideal material supported by both the Earth and human beings.

Unitika's proprietary technologymPolylactic Refor ing
acid

tio

n

Terramac
Pr

Po
ly

me
r

iza

e
oc

ng
ssi

Lacticacid

Fermentation

TERRAMAC'smaterial circulation system

Co
mb
ustio
B io
n
deg
radi
ng

Products

Starch

Se

pa

ra
tio
n
Biomass resources(such as corn)

Photosesis
ynth

Carbondioxide
Water

cess

g pro

yclin

c
To re

Temperature
HumiditypH

Light
Minerals
Human activities, chemical reactions
Reactions caused by activities of organisms

Terramac is extremely safe for human health and the environment.
Biodegradability:

Can be used for these applications.

JIS K6953 (ISO 14855) Passes the test of beneficial and extreme biodegradability
and destructibility under controlled compost conditions.

Labeling,
Conforms to GreenPlaÆ Identification and Labeling System/certification standard set by Japan Bio
certification standard: Plastics Association (JBPA). (Has been placed on Positive List, and been certified with the GreenPlaÆ Mark.)
Food sanitation:

Conforms to standards and criteria set forth in Ministry of Health, Labour and Welfare Notice No. 370(Food Sanitation Law). Certified under US FDA/FCN (Food Contact Notification) No. 178.

Bacterial resistance:

Polylactic acid is reported to have antibacterial properties.
(Bokin bobai, Vol. 29, No. 3, pp. 153 to 159, 2001)

Low combustion heat:

Low combustion heat of approximately 19 kJ/g is one-half to one-third the value of oil-based plastic, so can't
harm incinerators. Does not generate toxic gases (dioxins, hydrogen chloride, NOx or SOx) when incinerated.

Digital equipment parts(Fuji Xerox Co., Ltd.)
Ramen noodle containers(Acecook Co., Ltd.)

Expanded method resin foams(Sekisui Plastics Co., Ltd.)Terramac products with the IngeoTM are in compliance with the NatureWorks Brand Policy, and uses NatureWorks® biopolymers.
NatureWorks, Ingeo, and the Ingeo logo are registered trademarks of NatureWorks LLC in the United States andother countries.
www.natureworksllc.com

36Environmental Report
Production Site Information

Uji Plant
Location: 5 Uji-Tonouchi, Uji-shi,
Kyoto, Japan 611-0021
Site area: 311,781 m2
ISO 14001:
Certification No. JCQA-E-0058
Certification No. JCQA-E-0249
Main products: Nylon resin, nylon fiber,
engineering plastics, nylon/polyester film

Air

Water

Site manager:

Substance

Unit

Regulation
value

Measuredvalue

SOx total

Nm3/hour

29.1

NOx

ppm

199

32

Dust

g/Nm3

0.025

< 0.001425

4.0

COD load

kg/day1,131.4

Suspended matter

mg/l

30

5

Oil

mg/l

16

< 0.5

Nitrogenkg/day721

230

Phosphorus

kg/day97

6

Substance

Unit

Regulationvalue

SOx total

Nm3/hour

34.89

0

NOx

ppm

100

78

Taro Tokuzawa

Okazaki Plant
Location: 4-1 Hinokita-machi,
Okazaki-shi, Aichi, Japan 444-8511
Site area: 313,865 m2
ISO 14001:
Certification No. JCQA-E-0292
Main products: Polyester resin, polyester
fiber, spunbond (filament nonwoven fabric),
medical equipment, environmental business

Air

Water

Site manager:

Measured
value

Dust

g/Nm3

0.05

< 0.001

COD load

kg/day

718.7

79.3

Suspended matter

mg/l

20

7

Oil

mg/l

10

<1

Nitrogenkg/day385

44

Phosphorus

kg/day51

11

Substance

Unit

Regulationvalue

SOx total

Nm3/hour

0.49

NOx

ppm

180

83

Dust

g/Nm3

0.3

0.003
2.9

Kenichi Shimomori

Toyohashi OfficeSite manager:

Hitoshi Onozuka

Location: 101 Matsunami, Akebono-cho,
Toyohashi-shi, Aichi, Japan 441-8527
Site area: 270,804 m2
ISO 14001:
Certification No. UJL A16735
Volume: I (U-AI Electronics Corp.)
Main products: Nonwoven fabrics(sheeting for civil works and roofing
applications), biobusiness (cauliflower
mushroom: Sparassis crispa),
Printed circuit boards

Air

Water

Measured
value

0.028

COD

mg/l

11.9

Suspended matter

mg/l

20

6

Oil

mg/l

5

<1

Nitrogen

mg/l

120

11

Phosphorus

mg/l

15

1.2

Substance

Unit

Regulationvalue

SOx total

K value

11.5

NOx

ppm

180

85

Dust

g/Nm3

0.3

0.004

Tarui Mill
Location: 2210 Tarui-cho, Fuwa-gun,
Gifu, Japan 503-2121
Site area: 156,224 m2
ISO 14001:
Certification No. JCQA-E-0323
Main products: Cotton nonwoven fabrics,
glass cloth
Site manager:

Keisuke Obata

37

Air

Water

Measured
value

1.1

COD load

kg/day

108.4

82.1

Suspended matter

mg/l

50

8

Oil

mg/l

5

1

Nitrogen

mg/l

120

2.1

Phosphorus

mg/l

16

0.08

Environmental Report

Miyagawa Mill
Location: 341 Honmachi, Obata-cho,Ise-shi, Mie, Japan 519-0593
Site area: 103,404 m2
ISO 14001:
Certification No. JCQA-E-0476
Main products: Yarn and woven fabricmade from wool and wool blended
materials

Air

Water

Site manager:

Substance

Unit

Regulation
value

Measuredvalue

SOx total

K value

17.5

NOx

ppm

180

65

Dust

g/Nm3

0.3

0.002
16.7

2.0

COD load

kg/day91.2

Suspended matter

mg/l

30

2

Oil

mg/l

20

2.9

Nitrogen

mg/l

10

4.4

Phosphorus

mg/l

1.5

0.04

Substance

Unit

SOx total

Nm3/hour

9.1

3.9

NOx

ppm

170

133
0.047

Hitoshi Yamaguchi

Sakoshi Plant

Site manager:

Location: 846 Takano, Ako-shi,
Hyogo, Japan 678-0171
Site area: 191,236 m2
ISO 14001:
Certification No. JCQA-E-0093
Main products: Vinylon fiber(for industrial materials such as cement,
rubber reinforcements, tatami thread
and papermaking binders)

Air

Water

Regulation
value

Measured
value

Dust

g/Nm3

0.12

COD load

kg/day348

52

Suspended matter

mg/l

3.9

2.49

Oil

mg/l

10

1.53

Nitrogen

mg/l

15

0.76

Phosphorus

mg/l

2

0.04

Substance

Unit

Regulationvalue

SOx total

K value

17.5

NOx

ppm

130

67

Dust

g/Nm3

0.3

0.002
2

Mitsuhiro Umino

Tokiwa Mill

Site manager:

Location: 88 Nakahara, Souja-shi,
Okayama, Japan 719-1195
Site area: 137,551 m2
ISO 14001:
Certification No. JCQA-E-0221
Main products: Cotton 100% yarn,
Blended yarn with synthetic & cotton,
Synthetic woven fabrics blended
with cotton

Air

Water

Measured
value

0.6

BOD

mg/l

80

Suspended matter

mg/l

100

1

Oil

mg/l

2.5

<1

Nitrogen

mg/l

-

-

Phosphorus

mg/l

-

-

Substance

Unit

SOx total

Nm3/hour

-

-

NOx

ppm

180

15.6

Taizou Ishida

Union Co., Ltd.
Location: 10-1 Ohmine-Minami,
Hirakata-shi, Osaka, Japan 573-0145
Site area: 6,886 m2
ISO 14001:
Certification No. JCQA-E-0835
Main products: Glass beads

Air

Water
President:

Yoshiki Shimizu

Regulation
value

Measured
value

Dust

g/Nm3

0.15

0.0275

COD

mg/l

300

29

Suspended matter

mg/l

300

5

Oil

mg/l

2

< 0.5

Nitrogen

mg/l

150

1.8

Phosphorus

mg/l

20

0.09

Water quality refers to values for outgoing wastewater.

Note 1: The displayed regulation values are the most rigorous values mandated by law (Air Pollution Control Law or Water Pollution Control Law),
regulations, prefectural guidance or conventions.
Note 2: Includes environmental impact from affiliates within site.
Note 3: SOx = sulfur oxides, NOx = nitrogen oxides, COD = chemical oxygen demand, BOD = biological oxygen demand
Note 4: The displayed air pollution values are the measured values for the major facilities at each site (totals are values for entire site).
Note 5: The displayed water pollution values are the highest values measured at the drain outlets at each site (load amounts are values for entire site).

38

Inquiries
4-1-3 Kyutaro-cho, Chuo-ku, Osaka, Japan 541-8566
Management Planning Department
IR and PR Group: (Tel.) +81-6-6281-5695
Web site: www.unitika.co.jp