Environmental Report
Version: 2011

Iseki aims to“live peacefully with a stable natural environment”

I N D E X
Message from our president . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2Outline of our business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3

Major products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4Environmental management
Eco vision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5Outline of management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6Mid-term and long-term environmental targets . . . . . . . . . . . . . . 7
and results of the FY2010

Second mid-term and long-term environmental targets . . . . . . .

8Environmental accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9Environmental performance
Eco factory

Business activities and environmental stresses . . . . . . . . . . . . . 10
<Eco balance / ECO-efficiency>

Environmental risk management . . . . . . . . . . . . . . . . . . . . . . . . 11
<Examples of air pollution prevention and control>

Promotion of energy saving . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
<Preventing global warming / Reducing total material input>

Promotion of energy saving . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
<Preserving water resources / Optimal control and reduction of use of chemical substances>

Reduction of industrial wastes <3R of production processes.> . . . . . .15
Eco products

Approach to preserve biodiversity . . . . . . . . . . . . . . . . . . . . . . . 16
Approach to design for environment . . . . . . . . . . . . . . . . . . . . . 17
Support to promote environment-friendly agriculture . . . . . . . . . 20
Green purchase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Collaborative creation together with stakeholders
Education and training for environment / Qualified persons . . . 23
Environmental communication . . . . . . . . . . . . . . . . . . . . . . . . . . 24

The coverage of this report

Term covered: Term covered: 2010 Fiscal Year
(From April, 2010 to March, 2011)
Activities covered: Domestic activities
Organization: Iseki & Co., Ltd., affiliates,
domestic covered distributors
and sales subsidiaries
Guideline used: Environmental Report Guideline(2007 edition) as reference
and GRI Guideline

Picture taken at Kumakogen-cho, Kamiukena-gun, Ehime Prefecture

Environmental data
Iseki-Matsuyama MFG. Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . 27
. . . . . . . . . . . . . . . . . . . . . . . . . . 28
Iseki-Kumamoto MFG. Co., Ltd.
Iseki-Niigata MFG. Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Iseki-Houei MFG. Co., Ltd.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Message

Aiming to bring about a prosperous community,
constantly growing in affluence
While global warming and the depletion of energy resources have become critical global
environment issues, the Great East Japan Earthquake which occurred on March 11, 2011highlighted the importance of stable securement of clean risk-free energy, as well as thefinite nature of such energy. Japan has already implemented an approach to drasticallyreduce greenhouse gas by proposing a plan called “Challenge 25”, investing toenvironmental preservation activities and living a Low-Carbon lifestyle (an ecologicallifestyle). Taking the Great Earthquake as a lesson, means for achieving the goal arereconsidered. It is necessary to reduce greenhouse gas in every field and responsibilities
should be imposed on every entity to improve his/her motivation and play active roles tocreate a Low-Carbon society.
Since its foundation over 86 years ago, Iseki has made exertions to improve theproductivity through the promotion of agricultural streamlining and by reducing fatigue
farming work through providing agricultural machines. An effective use of bio-mass for
agriculture in which Iseki Group’s business is based allows for not only great contributions
with respect to the prevention of global warming by controlling the emission of greenhousegas and the formation of a recycle-oriented society by utilizing resources which had beennormally disposed of as wastes, but also for regional revitalization and an increase in job
opportunities. Iseki believes that we can serve society by tangibly improving food self
sufficiency rates through the utilization of sparse planting technology that we have beendeveloping through improvements in agriculture and agricultural machinery, provide
insight regarding the expansion of consumption such as the local consumption of local
products, and by providing information regarding dietary education and the future of ourfood strategy.
Iseki Group recognizes that it is our social responsibility to contribute to society which isin the stage to be recycle-oriented. We therefore position these as important managementtasks among others. Our environment preservation activities were started primarily at our
manufacturing factories and they have now spread widely throughout the entire scope of ourbusiness, from headquarters to sales subsidiaries, through the implementation of theEnvironmental Management System (EMS). From initial product development,
manufacturing, product logistics and all the way to after-sales
activities all business activities at Iseki Group are based on atangible target and the management system so as to be anenvironment-conscious company. Iseki continues our efforts tobe of assistance in establishing a “prosperous community,
constantly growing in affluence.”
We are pleased to have an opportunity to publish this 2010
report of our approach and actions to preserve the global
environment. Iseki Group carries out now and in future years,
our social responsibilities to even greater improve theenvironmental quality through the group-wide environmental
management activities. We would like to ask for your further
support, assistance, and cooperation to make our activities
successful.
President

Seiichiro Gamo

Outline of our business<Company profile>
Company name

ISEKI & CO., LTD

Headquarter

700 Umaki-cho, Matsuyama-shi, Ehime prefecture
Phone: +81-89-979-6111
Fax: +81-89-978-6440

Main office

5-3-14, Nishi-Nippori, Arakawa-ku, Tokyo
Phone: +81-3-5604-7602
Fax: +81-3-5604-7701

Foundation

August, 1926

CapitalJPY 23,344,000,000 (as of March 31, 2011)

Employees

Consolidated: 6,404 (as of March 31, 2011)
Our main business activities are manufacturing and sales of following products:

Business activities

Cultivating machiney ......... Tractors, Cultivators, High-clearance multipurpose vehicles, Lawnmowers
Planting machinery ............ Rice transplanters, Vegetable transplanters
Harvesting machinery ........ Combine harvesters, Binders, Harvesters, Vegetable harvesters
Processing machinery ....... Rice hullers, Dryers, Rice milling, Rice graders,
Vegetable processing machinery
Others ................................ Farming implements, Spare parts, Agricultural facilities< Achievement trends (consolidated)>

Net sales<Sales composition by product category as of March, 2011 at the end of fiscal year>
Others 0%(billions of yen)

Ordinary income(billions of yen)

Other
agriculturalbusinesses
23%

Cultivating
and mowing
machinery
27%

Planting
machinery
10%

March
2007

March
2008

March
2009

March
2010

Serviceparts andfarming
implements
22%

March
2011

<Financial statements>(As of March 31, 2011)

Summary of consolidated balance sheet
Account
Cash and deposits
Notes and accounts
receivable-trade
Inventories
OthersTotal Current Assets
Property,plant and equipment
Intangible assets
Total Investments
and other assets
Total Noncurrent Assets
Total Assets

Amount (in mil. JPY)

Account
Notes and accounts payable-trade
Short-term loans payable
Long-term loans payable
OthersHarvesting andprocessing
machinery18%(From April 1, 2010 to March 31, 2011)

Consolidated statement of income
Amount (in mil. JPY)

Total Current Liabilities
Capital stock
Capital surplus
Retained earnings
Treasury stock
Valuation difference on available-for-sale securities
Revaluation reserve for land
Foreign currency translation adjustment
Minority interests
Total Net Assets
Total Liabilities and Net Assets
Note: The amount shown is the number after rounding the fractional part.

Account

Amount (in mil. JPY)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Non-operating expenses
Ordinary income
Extraordinary gains
Extraordinary losses
Income before income taxes
Income taxes
Minority interests in income (loss)
Net income
Note: The amount shown is the number after rounding the fractional part.

Major products
Tractors

Rice transplanters

Combine harvesters

Machines for exports

Line-up of other productsElectric mini tiller

Inside ridge processor

Onion transplanter

Binder

Dryer

Rice huller

Weighing and separating machine

Coin-operated rice milling machine

Hydroponics facility

Eco vision
Environmental management

Iseki Group has determined the direction which can be the base of our “Eco vision:
Green Cycle”, and the words, “Environmental concept”, “Basic environmental policy”,
and “Environmental conduct guidelines”, best explain our principles.

*1[Green Circle]

3A is: The management on the Axis of Agriculture and Agricultural machine (3A)
“Business Management with Agriculture and Agricultural Machinery as its key”

nature3A(*1)

society

corporate

Iseki Group has walked together with Agriculture since its establishment. Based on ourmanagerial creed, “Management on the Axis (3A) of Agriculture and Agricultural machines”,
we promote environmental preservation activities with harmony between nature and society.
[ Environmental concept ]“Agriculture and Agricultural machines” are the axes ofour management and we contribute to the formation of acontinuously growing society through activities forharmonizing nature, society, and business entities.
[ Basic environmental policy ]1. Maintain environmental management system and its
functional applications
2. Reducing elements of our business activities andproducts which may be causing stress on theenvironment
3. Compliance with environmental laws, regulations,and standards
4. Environmental education and information disclosure[ Environmental conduct guidelines ]1. Development activities considering environment
Recycling and reduction of noise, vibration, fuel consumption,
emission gas, and environmental stress substances
2. Environment-friendly manufacturing activities
Prevention of (air, water, noise, and vibration) pollution, energysaving, resource-saving, and purchasing green
3. Office activities considering environment
Energy-saving and resource-saving
4. Distribution and logistics considering environment
Improvement of transportation system (promotion of modal shift),energy-saving and disposition of industrial wastes (promotion ofzero emission)
5. Development of biodiversity
Promotion of tree-planting activities of Iseki Group
6. Environmental education and information disclosure
Environmental education to be offered to employees, participation insocial activities and information disclosureOutline of management
Environmental management

We deploy our approaches to develop the recycling-oriented and Low-Carbon society
and biodiversity within all of our group companies.

<Promotional scheme><Environmental planning group meeting>

Entire companies within Iseki Group promote the developmentof recycling-oriented and Low-Carbon society and biodiversity
by using the environment management system as a tool,
through involvement with R & D dept., Production dept.,
Logistics dept., and sales subsidiaries.

The Environment Planning Group Meeting plots out tangible
plans to be deployed in each district, provides strategies andadvice to the Environment Committee, assists each district todeploy environmental targets and action plans, and manages
the progress of such plans. At the same time, the Environmental
Management Office and the Product Assessment Committee,
which supports the designing of environment-friendly products,
are established to assist activities to be efficient andsuccessful.

<Environment committee><Environment management system employed in each district>

The Environment Committee, whose members include thepresident as chairman and all directors, deliberates anddetermines Iseki group’s basic policies regarding theenvironment, as well as the accommodation of managementtargets, action plans, and corrective actions for criticalenvironmental issues submitted by the Environment PlanningGroup Meeting.

An Executive Officer responsible for the environmental
management activities and the Environmental Manager are
assigned to Tokyo, Matsuyama (Tobe), Matsuyama (Wake),
Kumamoto, Niigata and sales subsidiaries in each district.
These executive officers shall be responsible for thedetermination of policies, deployment of action plans,establishment and operation of an environment management
system in each district.

[ Environmental Management Organization ]CEO

Environmental Committee

Environment Management OfficeEnvironmental Planning Group Meeting

Product Assessment Committee

Tokyo district

Matsuyama (Tobe) district

Matsuyama (Wake) district

Kumamoto district

Niigata district

CEO ofeach company

Director assigned
to General Affairs

Environment
Manager

Environment
Manager

Chief Operation
OfficerDevelopment &Production
Division

CEO ofIseki-Matsuyama
MFG. Co., Ltd.

CEO ofIseki-Kumamoto
MFG. Co., Ltd.

CEO ofIseki-Niigata
MFG. Co., Ltd.

CEO of Iseki-Houei
MFG. Co., Ltd.

Environment
Manager

Environment
Manager

Environmental
Management
Committee

Environmental
Management
Committee

Sales Subsidiaries

Environment
Manager

Environment
PromotionCouncilEnvironment
PromotionCouncilEnvironmental
Management
Committee

Environment
Manager
Environmental
Management
Committee

Mid-term and long-term environmental targets and results of the FY2010
Environmental management

Iseki group has defined and worked on the mid-term and long-term environmental targets
to be achieved by 2010.
FY2010 was the final year of the term. Hereby, we report on the results of our major activities in FY2009.
Item

Mid-term and long-term environment targets

Evaluation

Accomplishments in FY2010

Eco Factory

Prevention of
global warming

Reduced the volume ofenergy-generated CO2 emission for
the total production volume by 15%
comparing to the volume in FY1997

The total volume of CO2 emission was reduced by 15% of the reference year. However,the volume of CO2 for the total production volume was reduced by 3% of the reference
year, falling short of the goal. We are continuously taking actions to reduce CO2.

Reduction ofwater used

Reduced the volume of water used
for the total production volume by
30% or more compared to thevolume in FY1997

The volume of water used for the total production volume was reduced by 30% of thereference year. As a result of renovation of the water supply piping,conducted as mid-term plan, a steep reduction was achieved.

Reduction ofwastesReduced the final volume of wastes
for the total production volume by
70% or more compared to thevolume in FY1997

The final volume of wastes for the total production volume was reduced by 80% of
the reference year as a result of improvement of reuse and recycling rate ofcast metal wastes, as well as segregation of wastes.

Chemical
substance
control

Reduced the volume of controlled
substances for the total production
volume by 20% or more comparedto the use in FY2001

The emission of controlled chemical substances for the total production volume was 12%
lower than the reference year. We will continuously strive to reduce such chemical
substances by further pursuing factors which contribute to reduction including low-VOC
paint and solvents.

Relevant
pages

VOC:Volatile Organic Compounds (causative substance of photochemical smog and allergy)
Item

Eco Products
Item

Reinforcement of Environment
Management Basis
Item

Mid-term and long-term environment targets

Accomplishments in FY2010

Approach tobiodiversity

Promotion and expansion of
reduction of environmental stresses
at every stage of business activities

Iseki Group promotes business activities and provides products and services
in consideration of biodiversity to contribute to realizing a sustainable society
co-existing with nature.
We provide agricultural machines and facilities with decreased environmental stresses
as well as agricultural machines which reduce the use of “fertilizer” and“agricultural chemicals” having harmful effects on animals and plants.
Concerning development and manufacturing of diesel engines,
our products continuously complied with the emission control of Japan andother countries in the world.

Support ofnature-friendly
agriculture

Trend for safe, tasty and healthy
food and approach to energy andresource saving by compact products

To realize biodiversity, we develop products which contribute to reduction ofenvironmental stresses. We will continuously develop environment-friendly products
and promote environment preservation activities, fully considering the safety
and reassurance of food.

Promotion ofpurchasing
green

Promoted purchasing green
through good relationships
with business partners

The overall rate of purchasing green including office supplies in the entire company was 93%.
The rate of the purchasing green for production parts and materials was 70％. Iseki will
request and assist our business partners in developing the environmental management system
for increasing the purchasing green rate. As in last year, Iseki obtained a green electricity
certificate of solar energy of Sunshine Project promoted by Matsuyama city, which is now
used for the power in the “local production for local consumption activities” corner.

Mid-term and long-term environment targets

Accomplishments in FY2010

Environmental
management
systemISO14001 certificate updating /EA21 certificate updating at
each manufacturing factory

The headquarter offices and manufacturing factories promote the activities which utilize
ISO14001 in most efficient ways.
In order to promote the approaches that will realize a recycling-oriented and low carbon
emission society, Iseki Group, including sales subsidiaries, implemented regular audits
according to the annual plan. Our distributers promoted environment preservation
activities by targeting the entire organization and all the employees,
which is a major point of the “Eco Action 21 Guideline” 2009 edition and afterward.

Entrenching ofenvironmental
accounting

Introduction of environmental
accounting and up-grading

We have introduced and deployed an environmental accounting system as an index of
our environment preservation activities. We will continue to check if the environmental
preservation effects are comparable for the investment in order to grasp the investment
effect, prevent the global warming and promote environmental preservation activities
which contribute to biodiversity.

Environmentalrisk
management

Strictly obey laws and regulations /Predict potential risks andstrengthen the management
system in order to prevent theactualization of such risks strictly

Iseki cleared all self-directed control standards which are more stringent than the criteriaof legal measurement requirements on top of the legal compliance rules. From now, we
will take actions for environment preservation by management of various environmental
data according to the provisions of Amended Energy-saving Law and Law Concerning
the Promotion of Measures to Cope with Global Warming which specify the changes
from plant basis to company basis, as well as strengthening of the management structure.
Ise Taking the Great East Japan Earthquake as a lesson, Iseki implemented emergency
training on a regular basis at each factory to be able to respond to emergency cases.

Mid-term and long-term environment targets

Collaborative Creation

Environmental
education

Environmental
communication

Accomplishments in FY2010

Raising employees’
environmental consciousness /offering training to improvethe environment preservation
techniques

We strived to improve the capability of internal auditors through training by external
educational institutes while promoting environmental education to employee, being
coupled with various education systems.
We recommended employees to have the official qualifications needed to deal withenvironmental laws and regulations including Amended Waste Disposal Act.
We trained and assigned new internal environment auditors in order to maintain theenvironmental management system properly.

Promotion of volunteer activities /enhancement of collaboration
with community

Our 4 local factories and offices strived to further increase the awareness about local
production for local consumption activities by displaying messages, etc.
At each factories, Iseki had accepted and arranged the factory tours for elementary
school students and general public in order to communicate about the importance ofagriculture and agricultural machinery.
Our sales subsidiaries promoted and participated in events to let many people know
about agriculture and agricultural machines.
Evaluation criteria: Achieved

Evaluation

Relevantpages

Evaluation

Relevantpages

Evaluation

Relevantpages: Nearly achieved: Not achieved

Second mid-term and long-term environmental targets
Environmental management
After the first plan (from 1997 to 2010), Iseki Group continues with the second mid-term and long-term plan(from 2011 to 2015) to reduce environmental stresses which includes the following targets.
1. Second mid-term and long-term targets for environmental preservation
Classification

Item to be
implemented

Realization of a low-carbon
emission society

CO2 emission rate(t/hundred million yen)
Reduction of CO2
Total CO2
emissions (t)Reduction of CO2
in distribution

Formation of a recycling-oriented society

Reduction ofwastesCO2 emission rate(t/ton-km)

Restraint of toxic
chemical substances
Restraint of
manufacturing resource

Reduction of
total material
input

FY2012FY2013

FY2014FY2015

Average result from
FY2008 to FY2010(compared to FY1997)
Average result from
FY2008 to FY2010(compared to FY1997)
Average result from
FY2008 to FY2010(compared to FY2006)

Average result from
FY2008 to FY2010(compared to FY1997)

Average result from
Rate of usage
FY2008 to FY2010
of water(t/hundred million yen) (compared to FY1997)
Total usageof water (t)Reduction ofsubstance subject
to PRTR Law

Mid-term and long-term targets
FY2011

Rate of final volume Average result from
FY2008 to FY2010
of wastes(t/hundred million yen) (compared to FY1997)
Final volume
of wastes (t)Water resourcesavingReference year

Control index

Usage rate(t/hundred million yen)

Total usage (t)Input rate(t/hundred million yen)

Average result from
FY2008 to FY2010(compared to FY1997)
Average result from
FY2008 to FY2010(compared to FY2001)
Average result from
FY2008 to FY2010(ompared to FY2001)
Average result from
FY2008 to FY2010(compared to FY2005)
Average result from
FY2008 to FY2010

Total input (t)(compared to FY2005)

2. Mid-term and long-term targets of business activities
Classification
Environmental
management
Product development
and service

Item to be implemented

Mid-term and long-term targets(1) Quality improvement of environmental
management system

To define targets of environmental approaches and enhance internal audits and external reviews
to improve the quality of the environmental management system.

(2) Implementation of environmental
education

To recognize the importance of environmental education activities to improve environmental
preservation activities.

(3) Environmental communication andcontribution to society

To communicate with local residents through volunteer activities and natural environment improvement
activities like tree planting, aiming to become a company which can contribute to the society.

(1) Development of products
in consideration of biodiversity

To develop products in consideration of biodiversity and realization of a recycling-oriented society
and protect agriculture and natural environment in Japan.

(2) Development of products to reduce
environmental stresses

To improve the durability, fuel and working efficiencies in the use of products.

(3) Prohibition, reduction and restraint of use of
toxic substances included in procured parts

To improve and expand the supply chain and strongly promote prohibition,
reduction and restraint of use of toxic substances included in procured parts.

(4) Establishment and expansion of productassessments and execution of LCA evaluation

To establish and expand product assessments and execution of LCA evaluation, enhance and improve
earth-conscious and environmentally-responsible design from manufacturing to recycling and disposal.

(5) Provision of information contributing toenvironmentalpreservation

To provide environmental information on safety, recycling and disposal on product manuals.

Environmental accounting
Environmental management
Iseki Group employed the environmental accounting system from2004 and deals with the use of aggregated costs used for theenvironment preservation activities for our management decisions
relevant to environment preservation, as well as for a guideline ofvaluation of business through information disclosures to the public.
The implementation of environmental accounting started in FY2004.

The amount invested for environment preservation costs (pollution
prevention, environment preservation, and resource recycling costs) in2010 was 292,500,000 JPY. The total amount of expenses was
544,000,000 JPY that we made through some investments into diesel
engine emission gas and maintenance and improvement of theenvironmental management system.
Economic effects resulted from the environment preservation measures

Environment preservation cost
Category

Amount ofinvestment(in mil. JPY)

Major programs(1) Cost spent in the business area
Breakdown

Pollution prevention cost

Sewage treatment(1)

Reduction of volume of various resources to be consumed(2)

Reduction of environmental stress substances(3)

Reduction of energy consumption
Total

Environment preservation cost Inverter installation

Resource recycling cost

The economic effect resulting from the environment
preservation measures, such as recycling of wastes,
streamlining of painting methods, use of energy-saving
machines, use of processing machines equipped withinverters and appropriate control and operation ofboilers, was 61,000,000 JPY. The physical effect was
the reduction of CO2 emission by 3,487 tons, reductionof water consumption by 34,561 tons, and recycling ofwastes by 4,015 tons.

Waste treatment(2) Cost required at previous and later stages Green purchasing
Maintenance of environment
management system(3) Control activity cost(4) Research and development cost Corresponding to emission gas regulation(5) Community activity cost

Amount (in mil. JPY)

Details of effectExpenses(in mil. JPY)

Cleaning activity in the district(6) Environment recovery cost
Total
Scope of aggregation : (Iseki-Matsuyama, Iseki-Kumamoto, Iseki-Niigata, and Iseki-Houei MFG.
Co., Ltd. and tobe office)
Period of data : April, 2010 to March, 2011

Environmental risk management
Environmental management[ Actions to comply with Antipollution Laws ]<Establishment of self-directed standards and management in the company>
4 local factories of Iseki Group set up and applied more stringent self-directed control standards than those described in the environment-related
laws and regulations. As shown in the table below, we have cleared all the self-directed control standards in FY2010, making progress toward
reduction of environmental pollution.
Measured item

Water
quality

Air

Units

Volume of suspended substances (SS)mg/L

Volume of biochemical oxygen demand (BOD)

Iseki-Matsuyama & Iseki-Houei MFG. Co., Ltd.

Iseki-Kumamoto MFG. Co., Ltd.

Regulatory Self-directed
control
standards standards

Regulatory Self-directed
control
standards standards

Resultin 2010

Resultin 2010Less than 1(Note 2)ppm

Less than 1Less than 0.5

Particulate

g/m3N

Less than 0.01

Less than 0.01

ppm

Particulate (electric casting melt furnace)g/m3N

Resultin 2010(Note 1)n-hexane (Mineral oil)
Nitrogen oxide (NOx)Iseki-Niigata MFG. Co., Ltd.
Regulatory Self-directed
control
standards standards

Not detected-: shows standard N/A or not applicable machines(Note 1)(Note 2): With the expanded sewerage works implemented by Matsuyama city in FY2008 and afterward, the regulated value of water discharge to the synthetic effluent treatment
outfall has been raised from 160mg/L to 600mg/L, however, the self-directed control standard of Iseki-Matsuyama MFG. Co., Ltd. and Iseki-Houei MFG. Co., Ltd is 80mg/L ,because industrial effluent is mixed. The measured values are as shown above.

<Frequency of environment data measurement>
Machine, equipment, and place
Industrial effluent
Casting melt furnace
Boiler
Lot boarder line

Measured item

Measuring frequency

Iseki-Matsuyama & Iseki-Houei MFG. Co., Ltd. Iseki-Kumamoto MFG. Co., Ltd.

Iseki-Niigata MFG. Co., Ltd.

Once a year

Once a year

Twice a year--

Twice a year

Twice a year

Once a year

Noise

Twice a year

Once a year

Once a year

Vibration

Twice a year--

Water quality
Air-: shows standard N/A or not applicable machines

Once a monthEco factory

Business activities and environmental stresses
Environmental performance[ Eco balance ]Iseki Group uses materials such as fuel, electricity, water and other raw materials in the process of production, and discharges chemical
substances and industrial wastes subject to laws related to carbon dioxide (CO2) and PRTR law.
We always check the volume of materials used for production (INPUT) and discharged volume of chemical substances and industrial wastes(OUTPUT) as an index in reducing discharge of such chemical substances and industrial wastes for realizing business activities with lessenvironmental stresses. The following shows figures of undertakings for 2010.

Energy660,000GJ
Electricity 52.5milliion kWh
Kerosene
880kL
Heavy oil
880kL
Butane gas
507,000m3
City gas
157,000m3
Gasoline
70kL
Light oil
25kL

Business activities
Development- Promotion of environment-conscious
designing
Procurement- Green purchasing

Water

Production

355,000m
Tap water
81,000m3
Under ground water 274,000m3
3- Promotion of energy saving- Promotion of effective
utilization of resources- Reduction of final
volume of wastes- Reduction of toxic
chemical substances- Reduction of water used volume

Chemical substances
Subject to PRTR law

149t

Major products:

Tractors, Cultivators,
Combine harvesters, Rice transplanters,
Engines, Dryers, Rice hullers,
Vegetable harvesting machines, etc.

Total substances
Main raw materials 57,600t

Products distribution to distributors
Transported volume 29.8million ton-km
Discharge volume of CO2 4,180t

Atmosphere
Discharge volume of CO2 29,300t
Discharge volume of soot and dust 885kg
Discharge volume of Nox 1,450kL
Discharge volume of Sox 2,520kL

Discharge water
Discharge volume 119,000m3
BOD
379kg

Chemical substances
Substances subject to PRTR
138t
law Discharge/Transfer volume

Industrial wastes
Industrial wastes Total volume 9,390t
Recycled volume8,060tReduction volume553t
Final volume
774t

To be used by customers[ ECO-efficiency ]It is important to improve eco-efficiency to realize a sustainable society. Eco-efficiency is presented as a value calculated by subtracting
environmental stresses from the value of a product or service. On the other hand, we defined “eco-efficiency = production volume ÷environmental stresses” and evaluated eco-efficiency with the eco-efficiency index and environmental stress integrated index. This means
eco-efficiency increases as the production volume increases or environmental stresses decrease.
In FY2009 and 2010, the production volume of four factories has significantly decreased compared to the reference year FY2005. We havebeen continuously taking actions to reduce environmental stresses and achieved improved eco-efficiency of 107 and environmental stressintegrated index of 80 in FY2010 compared to the index of 100 in the reference year FY2005.

[ Eco-efficiency index: the higher the more efficient ]Our eco-efficiency is presented as a value calculated bysubtracting the environmental stress integrated index of ourfour factories from the production volume of the four
factories. The environmental stresses have three items
integrated; volume of CO2 emissions, volumes of non-methane
VOC emissions and displacement and volume of landfilledwastes.

[ Environmental stress integrated index:
the lower the index is, the smaller environmental stresses are ]Based on the Panel Method of Professor Nagata at Waseda
University, we adopted the average value of the integration
coeffici en ts fo r Ja pa n pr esent ed by LCA exper t s,environmental experts and enterprise experts for integrationof environmental stresses, with the value of CO2 defined as 1.

Item

2005
2010
Integration
coefficient Actual value (t) Integrated value Actual value (t) Integrated value

Volume ofCO2 emissions(Index)Eco-efficiency index
Environmental stress integrated index

Volume of non-methane
VOC emissions and displacement
Volume oflandfilled wastes
Total of environmental
stress integrated values
Eco-efficiency
Environmental stress integrated
index (2005 as reference year）
Eco-efficiency index(2005 as reference year)
Environmental stress integration and eco-efficiency(FY)
Trend of eco-efficient index and environmental stress integrated index(100 in FY2005)

Eco factory

Environmental risk management[ Examples of air pollution prevention and control ]Environmental performance[Control to inhibit the emission of GHG (Global Greenhouse Gas)]< Approach to reduction of CO emissions by detoxifying discarded paint >2

Iseki-Matsuyama MFG. Co., Ltd. applies coating to prevent rust and beautify products. Paint which did not adhere to parts in the paintspraying process is washed away with water and collected so as not to be discharged to the air. The collected mixture is then separated into
water and paint with chemicals and the paint is disposed by landfillng as industrial wastes. By adopting a bio booth system*1 in thisimprovement activity, the volume of the discarded paint was reduced. This led to a reduction in number of times of maintenance of the paintspraying area (coating booth). As a result of improvement, the volume of CO2 emissions was reduced by 11,075kg-CO2 with the reductionof the discarded paint of 5,700kg in a year. Maintenance time was reduced by 240 hours. In the future, we will deploy the bio booth system
in other coating facilities as well to aim at zero emission, where the final disposal volume of industrial wastes is 1% or less of total emission.
To summarize the contents of improvement, air is sent to the coating booth tank by blower and made frothy by diffuser to be spread since
oxygen is required for activities of microorganisms.
*1 Bio booth system: Treatment to reduce the volume of paint which did not adhere to parts (discarded paint) by microorganisms.

Supply air by blower
Frothy air
BlowerMake air frothy bydiffuser

Coating booth tankDiffuser< Approach to reduction of fuel use by introduction of electric forklifts>
As an effort to reduce environmental stresses, Iseki-Kumamoto MFG. Co., Ltd. replaced engine-type forklifts to convey parts with electric
forklifts to reduce fuel use, which resulted in reduction of the volume of CO2 emissions and fuel cost.

[Reduction effect in FY2010]• Reduction of fuel use:
Approximately 6.2KL/year• Reduction of CO2 volume:
Approximately 15t-CO2/year• Reduction of fuel cost:
Approximately 750,000 yen/yearEco factory

Environmental risk management[ Examples of air pollution prevention and control ]Environmental performance[Control to inhibit the emission of GHG (Global Greenhouse Gas)]< Approach to reduction of electrical usage by replacing the lights of office with LED >In Iseki-Niigata MFG. Co., Ltd., the volume of CO2 emissions can be reduced byapproximately 55% and the duration of lights can be extended by 4 times or more
under the condition that the lights are lit 10 hours a day by replacing the 40W
straight tube fluorescent lamps of the first floor of the office with LED fluorescentlamps. It was necessary to replace the lights with 102 LED fluorescent lamps andimplement construction work to replace the stabilizers with converters. In the future,
we will promote replacement in places other than the first floor of the office inconsideration of cost-effectiveness.

• Reduction of electrical usage : 6,854kWh/year• Reduction of electricity charges: 103,000 yen/year• Reduction of CO2 volume : 3,215kg-CO2/year

First floor of office

4 advantages of LED lights
Long life

Energy saving

Mercury free

UV free

The designed lifetime of LED is
40,000 hours. The service life is
10 years or more even if the lightis used 10 hours or more a day.

The bulb and downlight types are approximately
80% more energy-saving than incandescentlamps, the fluorescent lamp type approximately
50% more than fluorescent and the storehouselamps, floodlight and street light types
approximately 70% more than mercury lamps.

Unlike fluorescent and mercury
lamps, LED lights do not use
mercury at all, reducing environmental stresses.
The material is polycarbonate
and splinterless.

LED lights hardly emit theinsect-attracting wavelength of
350 to 370mm.

< Approach to reduction of electrical usage by replacing downlights in welfare building with LED lights >With production stoppage of halogen bulb downlights used for lights of the canteen
of welfare facility and shortage of halogen bulbs to be used, Tobe Office replaced
the lights with LED to reduce electrical usage and volume of CO2 emissions. In the
future, we will promote introduction of LED lights to the design management building
where the lights are lit for a long time.

• Reduction of electrical usage : 8,430kWh/year• Reduction of electricity charges: 85,000yen/year• Reduction of CO2 volume : 3,180kg-CO2/year(estimation by 4h/day × operating days of year）

Ceiling of welfare facility

Full view of welfare facility

Downlight type

Eco factory

Promotion of energy saving[ Preventing global warming ]Environmental performance[Reduction of energy use in the factories]
4 factories of Iseki Group have been striving to
reduce consumption of energy such as
electricity and fuel required for production
activities in 4 factories, by realizing the efficient
operation of all machines and facilities, and by
replacing existing machines and equipmentwith energy-saving type ones.
In FY2010, the total volume of CO2 emissions
due to energy usage was reduced by 15%
compared to the reference year FY1997 andthe volume of CO2 for the total production
volume was reduced by 3%, falling short of the
mid-term targets. The reason for this was
because the production output in FY2010 was
greatly reduced than the reference year 1997.
We will continuously strive to reduce thevolume of CO2 emissions.

Volume of CO2 emissions resulted by using energy at 4 factories
Total volume (t-CO2)
Per production volume(t-CO2 / 100million yen)
Volume of CO2 emissions resulted by using energy

Volume of CO2 emissions resulted byusing energy (in per production volume)

Houei
Niigata
Kumamoto
Matsuyama[Reduction of energy use in product distribution]
We grasp the environmental stresses in
distribution of Iseki products and parts andtake actions to reduce them. In FY2006, we
became a specified shipper because theCO 2 emissions slightly exceeded 30 million
ton-km. After that, the emissions have beenvarying under 30 million ton-km.
In FY2007 and afterward, we have promoted
modal shift and contributed to reduction of
the total volume of CO2 emissions.

Volume of CO2 emissions in product distribution
10,000ton-km
Total volume (t-CO2)
Rate (t-CO2/10,000ton-km)
Modal shift rateNote) Modal shift rate = (railway ton-km + sea freight ton-km) ÷ total ton-km

Eco factory

Promotion of energy saving[ Reducing total material input ]Environmental performance[Reduction of total volume of materials used for production]
4 factories of Iseki Group use the aggregatedamount of total materials such as raw materials,
production supporting materials, purchasing
parts, etc. as an index to reduce the total
volume of materials used to promote energy
saving activities. The total volume of materials
used for production in FY2010 was reduced by
20% from FY2005 and the volume of materials
used for production for the total production
volume was reduced by 7%. We will continuously
strive to reduce the total volume of materials
used for production.

Materials used volume
Total volume (ton)Per production volume(ton / 100million yen)
Total volume of materials used for production

Total volume of materials used for production(in per production volume)

Houei
Niigata
Kumamoto
Matsuyama

Eco factory

Promotion of energy saving[ Preserving water resources ]Environmental performance[Reduction of volume of water used]
Volume of water used

According to the installation of the water
circulation facility and implementation ofcountermeasures for water leakage, 4 factories
of Iseki Group strived to reduce the volume ofwater used. Because of the effect of mid-term
investment for facilities, the total volume ofwater used in FY2010 was reduced by 39% andvolume of water used per production volume
was reduced by 30% compared to the reference
year 1997, achieving the mid-term targets.
Water shortage is becoming more serious issue
than food shortage or exhaustion of fossil fuelswith the population growth expected in the
future. We will continuously strive to reducewater usage.

Total volume (Unit: 10,000ton)
Per production volume (ton/100 million yen）
Volume of water used

Volume of water used(in per production volume)

Houei
Niigata
Kumamoto
Matsuyama

Eco factory

Promotion of energy saving[ Optimal control and reduction of use of chemical substances ]Environmental performance[Optimal control of chemical substances]
Volume of use of substances controlled by PRTR law

Four factories of Iseki Group strived to reduce
chemical substances subjected to PRTR law
by replacing paint with one which contains lesstoxic chemical substances stipulated andintroducing regeneration facilities of paintthinner. The total volume of use in FY2010 was
reduced by 6% and the used volume per
production volume was reduced by 12%compared to the reference year 2001, fallingshort of the mid-term targets. We willcontinuously strive to perform appropriate
control and management of such chemical
substance and reduce the volume of use andof VOC (Volatile Organic Compounds).

Total volume (ton)Per production volume (ton/100 million yen）
Volume of chemical substances use

Houei
Niigata
Kumamoto
Matsuyama[ Volume of use of substances controlled by PRTR law ](unit : ton)

2001

Matsuyama Kumamoto Niigata

XyleneTolueneEthyl benzene
Water-soluble zinc compound
Dichloromethane
1, 3, 5-Trimethylbenzen
Total

Volume of water used(in per production volume)

2009
Houei

Total Matsuyama Kumamoto Niigata

2010
Houei

Total Matsuyama Kumamoto Niigata

Houei

Total

Eco factory

Reduction of industrial wastes[ 3R of production processes ]Environmental performance[Reduction of wastes]
To build a recycling-oriented society, four factories of Iseki Group have been
contributing to an effective usage of their wastes by promoting restriction ofwastes, reuse and recycling.
The total volume of wastes in FY2010 was reduced by 21% compared to thereference year 1997 and by 10% per production volume compared to thereference year 1997. The final volume of wastes disposed such as bylandfilling was reduced by 82% and by 80% per production volume comparedto the reference year, achieving the mid-term targets.

Total volume of wastes

Recycling volume
Reduction volume
Volume of final
wastesVolume of wastes

Volume of final wastes (in per production volume)

Total volume of wastes （t）
Per production volume (t/100 million yen)
Volume of final wastes （t）
Per production volume (t/100 million yen)
Reduction volume(t)Recycled volume of wastes(t)Rate of final wastes (%)
Rate of recycling (%)

Waste disposal flow
The waste disposal flow in FY2010 is as shown below. The rate of final wastes was 8.2% and the rate of recycled volume was
86% which were greatly improved from the reference year 1997. The major factors are thorough segregation of wastes, newselection of waste disposal service for recycling and improvement that made much of the molding sand to be recycled as abase course material.
In accordance with the operations of the four factories, we will continue to promote restraint, recycling and thoroughsegregation of wastes to reduce the volume of final wastes and promote recycling, aiming at zero emission.

Waste disposal flow: FY2010(Unit: ton)

Direct recycling volume

Recycling volume
Recycling volume after treatment
Residual volume of treatment

Total of waste emissions

Volume of intermediate treatment

Volume of final wastes after treatment
Reduction volume

Direct volume of final wastes

Volume of final wastes

Note1) The reduction volume, the recycling volume after treatment and the volume of final wastes after treatment associated with
the intermediate treatment are the results of investigation to the subcontractor of waste disposal.
Note2) Rate of the volume of final wastes ＝volume of final wastes (D+H) ÷ total of waste emissions (A)Note3) Rate of the recycling volume ＝recycling volume (B+G) ÷ total of waste emissions (A)Eco products

Approach to preserve biodiversity
Environmental performance[Biodiversity guideline of Iseki Group]<Basic concept of the approach>Iseki Group is aware that we receive the benefits of blessings of nature (an ecosystem service) created by biodiversity.
Regarding the approach to preserve biodiversity as an important challenge in environmental management, we
promote business activities and provide products and services in consideration of biodiversity with those involved suchas local communities so that we can continuously preserve and take advantage of biodiversity and contribute torealizing a sustainable society co-existing with nature.

Concrete approaches
1．We will preserve biodiversity by considering impacts on nature at every stage of business activities and reducing
harmful stresses emitted from all the factories and offices to the environment.
2．We will preserve biodiversity by providing safe and easy-to-use agricultural machines and facilities in considerationof preservation of biodiversity and supporting sustainable agriculture in Japan and conservation of the naturalenvironment such as farmland and rivers.
3．We will promote technological development learning from natural providence and traditions, and develop andspread technologies which contribute to preserve biodiversity.
4．To make the approach to preservation of biodiversity more effective, we will promote communication with those
involved, such as stake holders and local communities, so that we can share the awareness of biodiversity andcooperate with each other.
5．We will provide education of natural environment to employees and raise awareness of society-wide preservationof biodiversity.

< Approach to reduction of fertilizer usage >We provide easy-to-use, high-performance and energy-saving agricultural machines and facilities which contribute to
reducing environmental stresses as well as agricultural machines which reduce and properly control the usage of“fertilizer” which is harmful to living organisms.

Eco-Unemaze-kun“Eco-Unemaze-kun” cuts the management costs by reducing theusage of “fertilizer”. We added an “entire mulching type” to the
traditional “3-ridge type”, “2-ridge type” and “flat-and-high-ridge type”
which have been developed with National Agriculture and Food
Research Organization (abbreviated as NARO) and sold on themarket.

Environmental preservation by reduction of the usage of “fertilizer”

Traditionally, “fertilizer” was applied to the entire field before
cultivation and ridge making and seedling transplanting followed
after that. The problems were that the growth of roots of crop plants
was limited in scope and fertilizer in ditches and all layers of ridges
remained unused and flowed out with discharged water, resulting inenvironmental pollution.
The entire mulching type of “Eco-Unemaze-kun” eliminates thiswaste. By applying necessary amount of fertilizer to necessary
locations, it can reduce fertilizer approximately by 30% compared to
all layer application.

Eco-Unemaze-kun
Partialapplication

Stir fertilizer
Apply to necessary parts

Improvement of efficiency of work

Fertilizer application, simultaneous ridge making, mulching andcovering with soil are done in one process, which reduces working
processes and improve efficiency. It also leads to reduction of fuelconsumption of the machine.

All layer
application

Apply fertilizer all overApplication method of fertilizer

Eco products

Approach to design for environment
Environmental performance< Approach of small TQ tractor >Reduction of vibration and noise
The basic structure of the floor of our conventional small tractors was rigid type and only the part on which feet were put was
mounted with simple rubber.
With our new TQ tractors, the right and left floor frames were combined together, rubber mount was employed on the whole floor
and the 2-cylinder engine was changed to a 3-cylinder engine. Thus, the vibration of floor was greatly reduced to approximately
40% of the conventional models.
By changing the 2-cylinder engine to a 3-cylinder engine to increase engine displacement, securing the necessary horsepower at
the same time, we decreased the rated speed of engine and reduced the noise around the ears of driver by 3% compared to theconventional models.

Floor frame

TQ15

Floor structure

Reduction of number of parts
This time, we newly adopted the “super full turn “ mechanism for the TQ tractors. This is a mechanism in which the front
wheels rotate approximately two times faster than usual, enabling turn in a small radius.
As introducing “super full turn”, we reviewed the structure adopted for our high-end model and changed it to “switchingof motors embedded in front axle＋wet type clutch”.
With the review of the structure, we reduced the number of parts associated with our high-end model and the cost,
making possible to implement the “super full turn” mechanism to these small tractors as well.

Improvement of operability and visibility
The main shift lever of the conventional models was situated on the fader
beside the seat and had a direct shift structure. The operability andvisibility were not good.
Our new TQ tractors have a main direct shift lever situated beside thehandle which can be seen during cultivation work. Compared to the
traditional model, it is easier to operate and operability and visibility
improved significantly.
These are human and eco-friendly tractors which are safe and easy to use
not only for the users of the conventional tractor but also for new farmers,
elderly and female users, making them feel less tired even after a longtime of work.

Main shift lever of a TQ tractor

Eco products

Approach to design for environment
Environmental performance< Approach of 4-row type HFC combine harvester >Improvement of threshing ability and operating efficiency
The new model combine harvester HFC433 has the following three newmechanisms to improve threshing ability.
(1) Twin flapper : A mechanism to control the direction and volume of
the air of fanning mill selection according to the processed volume.
(2) Sieve scraper : A mechanism to clean dust off the surface of sieve
by mobile cleaning device.
(3) Stuck paddy collection room : The threshing cylinder is extended
backward. A mechanism to collect stuck paddy at the rear of the joint
which leads to the dust exhaust cylinder.
With the above mechanisms, operation efficiency was doubled
compared to the basic model HV220 and improved by 16% compared tothe conventional 4-row combine harvester HFG433.

new mechanisms contributing to threshing ability(1) Twin flapper(2) Sieve scraper(3) Stuck paddy collection room
Collect in stuck paddy collection room

Sieve scraper

Operation at low speed, turning, moving backward
Drive motor

Operation at high speed

Operation efficiency

Operation efficiency [= Number of reaped rows (row) x operation speed (m/s)]

Operation efficiency

Reduction of weight

High efficiency

Improvement of threshingability with new mechanisms

Reduction of weight

The weight of the machine was reduced by 27% (550kg) compared tothe conventional model HFG433.
To improve the operation environment, we adopted a portal structure
for reaping section which has a reaping visor adjustable to 3 stages;
visor folded, visor opened and upper cover opened. This blocks ricehulls and dirt which fly and come when rice straws are pulled up andprevent dust from flying to improve the environment of operators.
Presented in index with the value of HFG433 as 100.

Eco products

Approach to design for environment
Environmental performance< Approach of rice transplanting vehicle >Electronically-controlled DFI engine mounted
We installed an electronically-controlled DFI engine to rice transplanting vehicle PZ63 and 73 (model HG).
The number of rotations of engine is strictly controlled by the electronically-controlled engine. The range of lever operation
read by HST lever sensor is calculated by engine ECU (computer) and the number of rotations of engine is controlled in each
output mode.

What is DFI (Digital fuel injection)?
This means to apply pressure to gasoline by pump to
inject it by nozzle (injector), while a carburetor makes
air-fuel mixture of gasoline and air in traditional principleof vaporizer. This method is widely applied to utility
vehicles because of improved output and torque as wellas improved fuel efficiency. Since amount of fuel supply
is adjustable electrically, it is always possible to obtain
the optimal combustion state.
FD501D-DFI Engine displacement : 437cc Maximum output : 19PS
Fuel supply : injection method

Operation mode
Characteristics of number of rotations of engine
Number of rotations of engine

We adopted a method in which output characteristics of 3
modes (green mode, standard mode, high output mode)can be selected according to operation conditions.
By selecting a mode according to the operation
conditions, it is possible to carry out energy-saving andenvironment-friendly operation with high fuel efficiency.
By selecting the green mode (fuel-efficient mode), fuelconsumption in light load operation can be reduced byapproximately 15%.

High output modeStandard mode
Green mode
Neutral First Second Third Fourth

Fifth

Sixth Seventh Eighth 8MAX

HST lever<Green mode>

A mode recommended when high efficiency and high load are notrequired. Even with traditional HST operation, the number ofrotations is kept low, allowing energy-saving operation in restraintof wasteful fuel consumption.

<Standard mode>

A mode optimal for general operation. As with the conventionalmodel, the vehicle speed accelerates as you turn down the HSTlever and the number of rotations of engine increases
proportionally.

<High output mode>

A mode optimal for high load operation. The number of rotations ofengine is increased from relatively low speed, allowing themachine to forcefully start and run even in agricultural fields withhigh running stress such as wet paddy.

Switch of 3 engine modes

Eco products

Support to promote environment-friendly agriculture
Environmental performance< Approach of compact type coin-operated rice milling machines >The number of general consumers who are attached to safety and taste of food and health is increasing. We have developed
compact type coin-operated rice milling machines (CPM3 series) which can be installed from suburbs to cities where many
general consumers live.

Approach to reduction of space
The installation space is 1/5 of that of theconventional house-typed coin-operated rice
milling machines (6㎡→1.35㎡), which allows
rice to be milled in a space as large as a vending
machine.
The results of evaluation with lifecycle
assessment (LCA) (compared to our standard)
showed that lifetime CO 2 emissions werereduced by 15% compared to the conventional
house-type machines.

Compact type
1.35㎡

Conventional
machine
6㎡

Parking space fortwo cars
25㎡

Approach to reduction ofenvironmental stresses
We reduced the noise during rice milling to 70dB
so that the machines can be also installedindoors. For the light of the sign, we adopted an
LED light to reduce the power consumption by
51% compared to the conventional fluorescentlamp. We also added a no-wash rice function to
the rice milling mode so that the volume of waterused to rinse rice can be reduced.

Compact type coin-operated
rice milling machine< Approach to reduction of usage of lead-containing paint >At present, use of toxic metals is regulated by environment-related regulations such as Soil Pollution Control Act and Waste Disposal
and Public Cleansing Law which promote prohibition and reduction of their use. Since some of the agricultural machines manufactured
by Iseki also use lead-containing paint, we are striving to use lead-free paint.
We started to take approaches in 2009 and reduced the use of lead by 75% at the end of FY2010 compared to FY2009 by changing
the color to that of lead-free paint at the time of model change of products. (The usage rate of lead-containing paint at the end of March,2011 is 2% of all paint.)

Major
reduction(1) The red color of OEM tractors for overseas was changed to the same type of color of lead-free paint (applied to all the modelsof MF brand tractors).
(2) Orange tractors were discontinued because of integration of OEM brands for overseas (AGCO brand tractors werediscontinued).
(3) The color was changed to that of lead-free paint at the time of model change of products (for new model tractor TQ series).

Usage rate of lead-containing paint withindex of Sept.2009 defined as 100

(1)

(2)
(3)

Sept.2009

TQ tractor remodeled with lead-free paint (neo blue)

Mar. 2010

Sept. 2010

Mar. 2011

Eco products

Support to promote environment-friendly agriculture
Environmental performance< Approach to collection of CFC of farm stockers >In the operation of “recycling system for discarded products” implemented and promoted by sales subsidiaries of Iseki Group
from FY2007, we added CFC used for farm stockers (refrigerators for agricultural products) to the subjects of collection fromFebruary, 2011.
Thus, on behalf of customers who have a farm stocker to be renewed 20 years after the release, it is now possible to entrust
recycle services to collect and dispose CFC at the time of disposal of products at a flat rate nationwide. By taking approaches tocollection of CFC, not only the manufacturer but also customers, sales subsidiaries and recycle services will carry out their duty
and take part in environment maintenance activities.

Flow of process manifest

Management of collection of
CFC in writing
In 2007, “Amended CFC Recovery and
Destruction Law” came into effect which
stipulated us to issue documents (processcontrol sheets) when we request collection
and disposal of Class-1 Specified Equipment
such as air conditioning and refrigerationequipment for business use.
CFC is proved to be duly processed frompickup to final disposal with documents
issued and referred to by each of thecustomer, the sales subsidiary and thecollection trader.

Customer(who discards the product)

Sales subsidiary(agent for delivery)

Collection traderof CFC

Fill in sheet A

Fill in sheet C

Fill in sheet E

Sheet A
stored for 3 years

Sheet C
stored for 3 years

Fill insheet F

Sheet E (copy)
stored for 3 years

Sheet E (original)
stored for 3 years

Sheet F
stored for 3 years

Send a copy

Farm stocker< Approach to improvement of efficiency of vegetable transplanter >In the vegetable farming market where safety/reassurance of food and local production for local consumption are attracting
attention, we developed semiautomatic vegetable transplanter PVH1 which supports low-cost agriculture by saving energy tomeet requests for “increased efficiency” and “ease of use”.

Realization of higher efficiency
By changing the seedling feeding section from the intermittent
rotation type to continuous rotation type, the planting ability wasincreased by 20 to 30%(*1) compared to the conventionalmodels.
(*1) PVH1-60JGX: Increased by 20% compared to PVH1-60J
PVH1-90JLLGX : Increased by 20% compared to PVH1-90JL
PVH1-70LGX : Increased by 30% compared to PVH1-80

Semiautomatic vegetable transplanter
PVH1-60JGX
PVH1-90JLLGXReduction of operation noise
By changing the seedling feeding section from the intermittent
rotation type to continuous rotation type, the operation noise of
the seedling feeding table and opening and closing noise of thehopper were reduced. The vibration of the machine was also
reduced, allowing more comfortable operation.
Semiautomatic vegetable transplanter
PVH1-70LGX

Eco products

Green purchase
Environmental performance< Green purchase of office suppliers >We have established the green standards for paperand 14 other categories of commercializedcommodities such as office suppliers and electricand electronic devices. In order to follow thesestandards, Iseki promoted the purchase of productswith environmental labels such as eco marks and
GPN standard products on a priority basis. The total
amount of green purchase of entire Iseki Group was
93% of the total purchase in FY2010.

Entire image of green purchasing

Parts, materials,
Customers and suppliers
and machinery with fewer
which are proactive
environmental stresses
for environmental
promotion

Non-green purchase
7%

Green
purchasing

Development ofenvironmentconscious
products

Ratio of green purchase
RecyclingGreenpurchase
93%

User

Environment-friendly
designing LCA

Reduction ofenvironmental stresses(Modal shift)

Environmental processes
Reduction ofenvironmental stresses

Manufacturing andshipping of environmentconscious products< Level of environmental awareness of our suppliers and vendors >Ratio of green purchasing

The Green Purchase ratios of our suppliers and vendors based on theenvironmental management system (EMS), evaluated and acknowledged
by ISO14001, Eco Action 21 (EA-21), others (KES, Eco Stage etc.) andgreen purchase standard of ISEKI & CO., LTD., were 58% of the total
number of vendors and suppliers and the amount of purchase from these
suppliers and vendors was 70% of our total purchase. Iseki will strive toencourage such suppliers and vendors to implement the EMS in the futureso as to improve the supply chain by increasing the ratio of our Green
Purchasing.

< Purchase of green electricity certificate >The number ofcompanies basis

Amount ofbusiness basis

Green electricity certificate…Electrical power generated from sunlight has an environmental value because it does not emit CO2 whengenerated, which is environment-friendly. This certificate allows this environmental value to be traded.
By purchasing a green electricity certificate in addition to ordinary electricity, Iseki is regarded as a user ofelectricity generated from natural energy.

Green electricity certificate

Electricity
itself

Green electricity certificate

Environmental
value

Ordinary electricity
purchased

Mascot of “Matsuyama Sunshine Project”

Outline of this business…

In this model business, the green electricity certificate is issued by Matsuyama city.
They sell the environmental value of solar power given from the public facility etc. (forcaptive use) to companies in the form of the certificate. Matsuyama city uses theearnings to employ solar systems for further expanding the business.

Eco-friendly business deployment is required in the future
We’d like to use
environment-friendly
green electricity forbusiness…
But it is difficult withproblems of the installation
place of solar power
generation device and funds…

Regarded aselectricity
generated fromnatural energy

Do we have anymeans to use“environmentfriendly electricity”
easily…

You can use this green
electricity certificate
according to the place,
period and volume.

So it is possible to getgreen electricity as much as
we need when necessary!

Education and training for environment / Qualified persons
Collaborative creation together with our stakeholders< Approach to systematic environmental education and training >The principle to develop the recycle-oriented society and realize theLow- Carbon emission society is to promote the reduction ofenvironmental stresses and thus it is necessary for each employee
to enhance their own consciousness and competency of theenvironment.
For this, taking the Great East Japan Earthquake as a lesson, Iseki
Group aims to improve environmental consciousness by providing
all employees with the education and training called environmental
program in three major steps according to the level of environmental
stresses: subjective training for every employee, training for special
jobs and education for employees who engage with jobs which
require certain official qualification.

to environment-related laws and legal qualification< Strict complianceand promotion of licenses related to environment >As we acknowledge that conformance to environment-related laws
and legislation is the basis of environmental preservation activities,
we therefore encourage all of our employees to observe safety andhygiene rules strictly.
At the same time, we offer our employees the opportunities toparticipate in seminars held by external institutes for managers incharge of pollution supervisor, chief electrical engineer, and boiler
engineers to have the official qualifications needed for thepromotion of developing recycling-oriented society. The number of
employees qualified for official environmental qualification as of theend of March, 2011 is shown in the following table.

Air
Pollution supervisor

Training forspecialist labors

Number of employees

Name of qualification

Consciousness education:
All employees

Water quality
Noise
Vibration

Energy control engineer
Energy controller
Chief electrical engineer
Boiler engineer
High pressure gas production safety supervisor

Officiallyqualified persons

Industrial waste treatment facility engineer
Specific chemical substances chief operator
Hazardous material handler
The number of officially qualified persons for environment

System for education and training for environment / Qualified persons< Environmental education >< Training for internal environment auditors >Iseki Group promotes the environmental preservation not only intheir workshops but also in their home and community such asenergy saving in their home and eco-driving.
In addition to education about prevention of global warming, we
disseminate the contents of the target adopted in the 10th
Conference of the Parties to the Convention on Biological Diversity(COP10) last year in daily operations and raise the awareness of theenvironment through the environmental training of new employees
and issuance of Iseki Group newsletters.

Iseki promotes appropriate improvements and continuous activities
through the environmental education based on the environmental
management system and yearly regular audits by external
certification institutes, as well as internal system application audits.
Iseki Group trains internal auditors in a planned and regular way toenhance internal environment audit. We have been offering our
employees in-house education and unified and systematic training
and education by third-party institutions as we think it is important to
up-grade the skills and capabilities of our employee in order to spiral
up in PDCA of the environmental management system.

< Environmental training >It is required to complete training and educations to a certain level
for any employees assigned to particular jobs such as casting, heat
treatment and painting before performing actual jobs. This training
and education is offered on a regular basis in accordance withvarious standards describing the impacts of such particular jobs tothe environment, daily management procedures, and emergency
procedures with due considerations of respective regulatorychanges.
Lecture for environment

Environmental communication
Collaborative creation together with our stakeholders

To exercise our responsibility as a company having a very close contact with the community, Iseki supports various
activities in each community. Contribution to the development of community is a priority mission of Iseki group.
Iseki is promoting the “FOOD ACTION NIPPON” project and the activities for the improvement of theself-sufficiency ratio through local production for local consumption activities in each region of Iseki Group
companies.

< Acceptance of plant tour >As a part of communication with people from outside, Iseki-Matsuyama MFG Co., Ltd., at the location of birthplace of Iseki, and other Iseki’s
manufacturing factories, including Iseki-Kumamoto, Iseki-Niigata and Iseki-Houei, accept elementary school students, local residents, andpeople from other countries for plant tours.

< Product exhibition corner >In the Exhibition Pavilion in Matsuyama, the base of advertisement and public relations of Iseki Group, there are exhibitions including major
products like tractors, the “SANAE-chan Farm” for home gardening, “FOOD ACTION NIPPON” and local production for local consumption
corners.

Website of Iseki http://www.iseki.co.jp< Execution of “clean activity” >As part of “Contribution to society and community”, which Iseki Group presents as our environmental policies for each district, our employees
participate in cleaning activities in their district.

Iseki-Matsuyama MFG. Co., Ltd.

Iseki-Houei MFG. Co., Ltd.

Iseki-Kumamoto MFG. Co., Ltd.

Iseki-Niigata MFG. Co., Ltd.

Tobe OfficeEnvironmental communication
Collaborative creation together with our stakeholders
As a company engaged in agriculture, ISEKI & CO., LTD. participated in “Farmers & Kids Festa” which was held as a bridge
between agriculture and children to let them, bearers of the future, experience agriculture and foods. The total number ofvisitors reached as much as 58,000 in two days and many of them visited Iseki booth as well. The annual “SANAE Nationwide
Children’s Picture Contest” marked its 15th anniversary in 2010 and the awarding ceremony was held in the event.

Farmers & Kids Festa 2010
< For children in the future >Outline●Date●Place●Organizer:November 20 (Sat.) to 21 (Sun), 2010
:Hibiya Park
:Executive Committee for the 1st Foodand Agriculture Festa●Co-organizers:Japan Agricultural Corporations Association
Japan Professional Agriculture Total Support Organization
Japan Brand Agricultural Corporation

Awarding ceremony of SANAE Picture Contest

Events in the Iseki booth●Home gardening with ERENA●Riding a combine harvester●Taking a commemorative photo with a tractor●Demonstration of rice milling machine●Awarding ceremony of SANAE Picture Contest etc.
Taking a commemorative photo with award winners

Operating ERENA

Taking a commemorative photo in front of a tractor

Riding on a combine harvester

Besides the above events, the exhibition corners of tractors, combine harvesters and rice transplanters and the demonstration ride
corner of a large-sized tractor attracted a lot of children. We believe they remained with them as a wonderful memory which “leads
to the future”. We also believe we could play a part in “a bridge between children and agriculture” which was the purpose of thisevent. In addition, we could let general public other than farmers know about “ISEKI & CO., LTD.” in the wake of this event.

Environmental communication
Collaborative creation together with our stakeholders< Tree-planting ceremony for ”town development with forests” >We enjoy many essential benefits of forests in the world which cover 1/3 of the land of the earth. They absorb CO2 in the air, supply oxygen, control
soil erosion, contribute to preventing floods and cultivate water-bearing layers and serve as places of biodiversity. At present, 12 companies in
Ehime Prefecture including ISEKI & CO., LTD. join in with “town development with forests” promoted by Iyo Bank and each company implements
tree-planting. On November 13 (Sat.) 2010, approximately 240 people (including both children and adults) participated in tree-planting in the areaof Iseki-Matsuyama MFG. Co., Ltd. They planted 24 kinds of trees such as Quercus myrsinifolia , Quercus glauca and Castanopsis sieboldii, 1,000
in total, in Miyawaki method*1 under the instruction of Professor Ninomiya of Faculty of Agriculture, Ehime University.
Miyawaki method*A 1tree-planting
method which Akira Miyawaki, a professor emeritus at Yokohama National University, presides over. The basic idea is to plant “a real tree”

which is suitable to the land. He insists that because the conventional individual measures against generation source to prevent global warming have arisen
from a negative mindset and are not enough, it is necessary to take a future-oriented positive measure, that is, to plant trees. Until now, he has instructedtree-planting in “Miyawaki method” in more than 1,600 places both in Japan and abroad, wearing a straw hat and boots.

Members who participated in tree-planting at Iseki-Matsuyama MFG. Co., Ltd.

< Highest of environmental rating of Development Bank of Japan (DBJ) 5 times in a row >In March, 2011, ISEKI & CO., LTD. earned the highest rating (environmental consciousness notably progressive) of “DBJ Environmental
Rating” of Development Bank of Japan (hereafter called “DBJ”) 5 times in a row.
“DBJ Environmental Rating” evaluates index of sustainable management of companies by a screening system developed by DBJ. It is thefirst loan menu in the world which offers advantageous interest rate according to the point. Evaluation and rating are made based on not only
information such as environmental reports but also on the results of questions to which companies reply by themselves. The questions
include approximately 120 items concerning the general management, business activities, performance of companies and vary according tocategories of business. More than 10 sheets for different categories are prepared. ISEKI & CO., LTD. is evaluated with a sheet for“Manufacturer (material, manufacturing and assembly)”.
In screening, marks are awarded out of 250 based on replies from companies. Major companies can fulfill the loan condition and obtain ”DBJ
Environmental Rating” if they have gained 100 or more. Companies which scored 140 to 159 are ranked as B and companies which scored
160 or more are ranked as A (notably progressive), to which advantageous interest rates are offered respectively.

RatingEnvironmental
screening

Company

Approximately
120 items,
out of 250

A
B

and mediumInterest rate
Major company Small
sized company
Special interest
160 or more
rate II

140 to 159

Special interest
rate I
Generalinterest rate

C

100 to 139

80 to 139

D
(Engagement)

80 to 99

50 to 79

Generalinterest rate

Without rating

Less than 80

Less than 50

Not passe

Certificate

Iseki-Matsuyama MFG. Co., Ltd.
Environmental data

< Company profile >Address
Number of
employees
Area< Environmental data >Volume of CO2 emissions resulted
by using fossil fuelVolume of CO2 emissions resulted by using
fossil fuel (in per production volume)

Wastes and recycling

700 Umaki-cho, Matsuyama-shi, Ehime prefecture
630 (As of March 31, 2011)
151,000m2

Major products Tractors, Medium and Small combine harvesters, Dryers, Engines<

Basic principles on environment

Recycling volume>

The Seto Inland Sea, a beautiful landscape which is incomparable
in the world. Sea dotted with green islands under a blue clear sky.
Iseki-Matsuyama MFG. Co., Ltd. determines action guidelines andpromotes any business activities which harmonize with theenvironment for preserving this blessed natural environment.

< Action policy >Reduction volume
Final volume ofwastesFinal disposal rate
Rate of recycling

Volume of water use

Volume of water use(in per production volume)

Volume of chemical substances use

Volume of chemical substances use(in per production volume)(Unit : 1,000ton)

1. Continuous improvement

Continuously improve the environmental management system andenvironmental performance by observing the environmental
management system based on ISO14001.

2. Observation of laws and regulations concerning environment

Observe environment-related legislation, local government regulations,and agreements concluded by the company.

3. Mitigation of negative impacts on environment and prevention ofcontamination

1) Minimize volume of CO2 generated as a result of production andelectric energy use2) Segregate wastes for collection and recycling3) Control chemical substance optimally
4) Product design to consider the environment
These purposes and targets shall be set up within a technically andeconomically possible range, reviewed on a regular basis in order todeploy them into business activities, and aim to improve the company
profit on top of the reduction of environmental stresses and theprevention of pollution.

4. Contribution to community

1) Save water and use water efficiently as a corporate citizen in order tocontribute to the severe water issues that our community has.
2) Proactive participation in the environmental preservation activities ofcommunity.

5. Familiarization of information to all employees

Familiarize all the information of environmental policy to all employees
in the company and deal with the environment issues together througha publicity using company news and environmental education.

6. Disclosure of environmental policies

Disclose the environmental policies upon request of outsiders.

1, 3, 5- Trimethylbenzene
Dichloromethane
Water-soluble zinc compound
Ethyl benzene
TolueneXyleneIseki-Kumamoto MFG. Co., Ltd.
Environmental data

< Company profile >Address
Number of
employees< Environmental data >Volume of CO2 emissions resulted
by using fossil fuel1400 Yasunaga, Mashiki-cho, Kamimashiki-gun, Kumamoto prefecture

Volume of CO2 emissions resulted by using
fossil fuel (in per production volume)

Wastes and recycling

297 (As of March 31, 2011)

Area

217,000m2
combine harvesters, Multi-crop combine harvesters,
Major products Large
Carrot harvesters<

Basic principles on environment

Recycling volume>

Reduction volume
Final volume ofwastesFinal disposal rate

Iseki-Kumamoto MFG. Co., Ltd. calls the importance of environment
into account through a supply of agricultural machines; therefore,
we strive to preserve these wonderful environmental resources,
such as nature, a rural paradise, and water, in Kumamoto.

Rate of recycling

Volume of water use

Volume of water use(in per production volume)

Volume of chemical substances use

Volume of chemical substances use(in per production volume)(Unit : 1,000ton)< Action policy >1. Continuous improvement

Continuously improve the environmental management system andenvironmental performance by observing the environmental management
system based on ISO14001.

2. Observation of laws and regulations concerning environment

Observe environment-related legislation, local government regulations,and agreements concluded by the company.

3. Mitigation of negative impacts on environment and prevention ofcontamination
1) Promote energy-saving and resource-saving
2) Promote reduction of industrial wastes
3) Accelerate recycling approach
Set up targets to the extent technically and economically possible tocarry out. Execute and review the targets on a regular basis so as tomitigate negative impacts and prevent contamination.

4. Contribution to community

Open company welfare facilities up to public and contribute to theenvironmental preservation through cleanup activities.

5. Familiarization of information to all employees

Familiarize all the information of environmental policy to all employees
and constituent members in the company and deal with the environment
issues together through a publicity using company news andenvironmental education.

6. Disclosure of environmental policies

Disclose the environmental policies upon request of outsiders.

1, 3, 5- Trimethylbenzene
Dichloromethane
Water-soluble zinc compound
Ethyl benzene
TolueneXyleneIseki-Niigata MFG. Co., Ltd.
Environmental data

< Company profile >Address
Number of
employees
Area< Environmental data >Volume of CO2 emissions resulted
by using fossil fuel3-12-23 Nishiohsaki, Sanjo-shi, Niigata prefecture

Volume of CO2 emissions resulted by using
fossil fuel (in per production volume)

Wastes and recycling

274 (As of March 31, 2011)
29,000m2

Major products Rice transplanters, Rice hullers, Vegetable transplanters, Binders<

Basic principles on environment

Recycling volume>

Clear water from Igarashi river, a feeder stream of great Shinano
river, natural environment surrounded by mountains of Echigo, andthe Echigo Plain known as an area which boasts of abundant riceproduction. Iseki promotes this business in harmony with the naturalenvironment through a supply of agricultural machines to preserve
this blessed environment.

Reduction volume
Final volume ofwastesFinal disposal rate
Rate of recycling

Volume of water use

Volume of water use(in per production volume)

Volume of chemical substances use

Volume of chemical substances use(in per production volume)(Unit : 1,000ton)< Action policy >1. Continuous improvement

Continuously improve the environmental management system andenvironmental performance by observing the environmental management
system based on ISO14001.

2. Continuous improvement and prevention of contamination

Set up the environmental target and practice to achieve the target while
reviewing the target on a regular basis in order to improve theenvironmental performance continuously.
1) Improve energy use2) Improve use of natural resources
3) Reduce waste and recycle4) Control chemical substances properly

3. Familiarization of information to all employees and contribution tocommunity

Distribute publicity to every employee through corporate environmental
activities and education, as well as having close communication withpeople in the community, in order to promote environment preservation
activities.
We will disclose our environmental policies to the public upon request
so that the people in the community will know our policies.

1, 3, 5- Trimethylbenzene
Dichloromethane
Water-soluble zinc compound
Ethyl benzene
TolueneXyleneIseki-Houei MFG. Co., Ltd.
Environmental data

< Company profile >< Environmental data >Volume of CO2 emissions resulted
by using fossil fuelAddress
Number of
employees
Area

Volume of CO2 emissions resulted by using
fossil fuel (in per production volume)878-1 Umaki-cho, Matsuyama-shi, Ehime prefecture
277 (As of March 31, 2011)

Wastes and recycling

8,959m2

Major products Cultivators, Tillers, Walk behind mower, System rice cooker< Basic principles on environment >Recycling volume

The community adjacent to the Seto Inland Sea National Park.
Iseki-Housei MFG. Co., Ltd. promotes the preservation of thisblessed community and the creation of a people-friendly working
environment for our employees.

< Action policy >1. Continuous improvement

Continuously improve the environmental management system andenvironmental performance by observing the environmental
management system based on ISO14001.

2. Observation of laws and regulations concerning environment

Observe environment-related legislation, local government regulations,and agreements concluded by the company.

3. Mitigation of negative impacts on environment and prevention ofcontamination
1) Reduce volume of electric energy use
2) Reduce volume of water use
3) Segregate wastes for collection and recycle

4. Contribution to community

1) Save water and use water efficiently as a corporate citizen in order tocontribute to the severe water issues that our community has.
2) Participate in the environmental preservation activities in our community
proactively

5. Familiarization of information to all employees

Familiarize all the information of environmental policy to all employees
and constituent members in the company and deal with theenvironment issues together through a publicity using company newsand environmental education.

Reduction volume
Final volume ofwastesFinal disposal rate
Rate of recycling(Unit : 1,000ton)

Volume of water use

Volume of water use(in per production volume)Achieving Harmony between Human Beings and the EarthContact about this report
Environmental Control Department, ISEKI & CO., LTD.
791-2193 1 Yakura, Tobe-cho, Iyo-gun, Ehime prefecture
Phone: +81-89-957-3311 Fax: +81-89-957-7959
E-mail: kankyo@iseki.co.jp
Issued in Aug., 2011

Let’s keep up with Green Purchasing.

This report is printed using a new technology,
soybean oil ink which contains limited volumeof VOC (Volatile Organic Compound).