FY2012 CSR Website CSR > Site Reports > Worksites > Mizushima Plant

The eastern Seto Inland Sea, where the Mizushima Industrial Complex is located, isa body of water known for the beauty of its many small islands, namely the Shiwaku
and Kasaoka islands, and the Kojima Peninsula, particularly at sunset. The stunningnighttime view of the Mizushima Industrial Complex from Mount Washu is also asource of local pride. The industrialization of this area of Japan officially started in1943, when sediment from dredging the Takahashi River to reinforce its banks anddredging local ports to allow large ships to enter was used to reclaim the land.

Aerial view of the Mizushima Plant

The Mizushima Plant, situated in a corner of the Mizushima Industrial Complex, started operating in July 1969.
The plant covers an area 900 meters long east-to-west and 300 meters wide north-to-south. As the largest
diversified user of C5 fractions* in the world, we produce a variety of materials necessary for socioeconomicactivities. Employees here are committed to operating a safe and stable plant in accordance with our motto,“Goanzenni”
Efforts to keep employees healthy and strong have continued unabated since we appeared on a TV program in
September 2010 as a “plant whose workers have muscular legs.” Our employees are given physical fitness tests on
a periodic basis and provided professional guidance when they fail to meet standard scores.
To earn the trust of our local community, we keep a careful watch on our environmental management performanceby performing plant health check-ups, which include inspections of air and water quality, noise, and odor. We also
host annual summer festivals, plant tours, and health walks to facilitate communication with local stakeholders.
Our mission is to be an environmentally friendly plant that is appreciated by the local community and meets thediverse needs of its customers by producing high-quality products in a safe and reliable manner.
* C5 fractions
Hydrocarbon molecules containing five carbon atoms. They are the byproduct of thermal cracking, or breaking down, of naphtha, and also include ingredients for raw materials ofsynthetic rubber and resin.

We at the Mizushima Plant are working to achieve innovation in production and, to that end, practicing “ABC,” which
stands for atarimae, bakashoujiki, and chanto, or in English: to earnestly and properly perform all of the routine butnecessary tasks. We believe that only by taking great care to follow operational rules and procedures in addition toobey laws and regulations can be upholding safety as our highest priority and continuously produce products withconsistent quality. Our actions are based on the recognition that instilling this ABC culture in our workforce tocontinuously deliver high-quality products is what society expects from the Mizushima Plant.

-1-FY2012 CSR Website CSR > Site Reports > Worksites > Mizushima Plant

1. Reducing toxic chemical emissions
Our plant has been butadiene-emission-free since fiscal 2002, when we adopted a closed recovery and processing
system. By measuring and reducing our VOC*1 emissions through PRTR*2 activities, we will continue to help
conserve the environment.
*1.Pollutant Release and Transfer Register
A database of hazardous chemical substances released into the environment and transferred off -site in waste. It provides the public with important information such as where andhow much pollutants are being released and transferred.
*2.Volatile Organic Compounds
Organic compounds that change easily to a gas phase and enter the air.

Substances subject to PRTR law

2. Reducing industrial waste
In fiscal 2011, we set a target of 5 tons or less for waste sent to the landfill and tried to reduce glassware waste
generated in our assay operations. Through testing we figured out how to recycle more glass by melting it, andsucceeded in reducing landfill waste to 3.7 tons.
We set 5 tons or less as our target for landfill waste in fiscal 2012, and hope to achieve further reductions in thisarea.

-2-FY2012 CSR Website CSR > Site Reports > Worksites > Mizushima Plant

Amount of Waste to Landfill

3. Reducing air and water pollution
We monitor emissions of hazardous substances to air and water on a daily basis
and through regular third-party assessments. Wastewater from the Mizushima Plant
flows into the Seto Inland Sea, a semi-closed body of water. Complying withenvironmental standards is the bare minimum we can do to show consideration tothe many people whose lives and livelihoods are dependent on the Inland Sea, andwe will continue to take due care to protect the environment.
Waste water treatment facility

CO2 emissions-3-FY2012 CSR Website CSR > Site Reports > Worksites > Mizushima Plant

SOx and NOx emissions

Total effluent waste water discharge, COD emissions, total nitrogen discharge and total phosphorus discharge

4. Saving resources and energy
In response to the deteriorating power situation in fiscal 2011, we switched to energy-efficient LED lighting in ouroffices. We took other actions that yielded immediate benefits, such as using light-blocking films and paints to curb
indoor temperatures and turning off lights during the day. We will continue efforts like these to conserve energy.

-4-FY2012 CSR Website CSR > Site Reports > Worksites > Mizushima Plant

Total amount of energy and Unit energy consumption index

5. Environmental Data
Mizushima Plant
Toxic substances
Substances
subject to PRTR
law

Industrial waste

Atmosphericemissions

FY2007

FY2008FY2009FY2010FY2011150,281

133,483

139,340

144,820

136,385

0.0

0.0

0.0

0.0

0.0

317,673285,584

293,497405,671442,900

1.0

1.0

1.0

4.4

4.4

58,98335,48845,09360,04560,400

6,750

4,849

5,006

5,374

5,935

19

19

6.6

6.8

3.7

CO2 emissions (tons)

351,881

315,893219,343

217,000

259,630

SOx emissions (tons)

1.5

1.9

4.3

4.6

3.8

70

63

75

77

80

---

2,378

2,481

2,550

2,200

2,150

2,382

2,640

13

11

11

13

15

0.7

0.5

0.4

0.6

0.6

21

15

12

17

16

123,793

110,690

77,93077,85291,500

79%

84%

51%

44%

54%

668,413563,495648,665

760,900

731,500

Butadiene consumption (tons)
Butadiene emissions (tons)
Consumption (tons)
Amount emitted (tons)
Amount generated (before volume reduction)(tons)
Amount generated (after volume reduction)(tons)
Amount sent to landfill (tons)

NOx emissions (tons)
Water resources (Industrial water +Ground water +3Waterworks) consumption (1,000 m )Total effluent waste water discharge
3(1,000 m )COD emissions (tons)
Waste water
Total phosphorus discharge (tons)
Total nitrogen discharge (tons)
EnergyTotal consumption (crude oil equivalent, kL)
Unit consumption index (1990 = 100)

Production of PDR equivalent (tons)-5-FY2012 CSR Website CSR > Site Reports > Worksites > Mizushima Plant

In line with ZEON’s Mid-Term Management Plan, SZ-20, including the Enterprise Blueprint for 2020: “ZEON creates
the future today through the power of chemistry,” the Mizushima Plant aims to realize global production technologies
that, through appropriate management of what we call the 4Ms—Material, Machine, Method, and Man—enableanyone anywhere in the world to produce great products with consistent quality. We hope to realize the Enterprise
Blueprint by using our quality management systems to improve the technologies we develop.

VOICEIn Preparation for 2020

In fiscal 2011, the Mizushima Plant launched an initiative to raise yield rates*1 to100%. First, in an effort to stabilize product quality, we created CAPD action sheets(CAPD is our version of the PDCA cycle that starts with Checking to see thatexisting systems have no problems or inadequacies, and then taking Action) tomanage quality through control charts and visually organize day-to-day actions overthe long term. As a result, the percentage of processes with a low capability
index*2 declined, resulting in more consistent quality. However, our work has only

Toru Nishijima, Corporate Officer andMizushima Plant Managerbegun, as we have yet to achieve 100% yield rates. By synthesizing practicalmanufacturing know-how with theoretical knowledge acquired through research, completing the control plan westarted in fiscal 2011 will be a major challenge.
Another task we need to accomplish by fiscal 2020 is standardizing technologies so that overseas plants canmanufacture products with the same level of quality. This is our responsibility as a mother plant*3, something wehope to achieve through collaboration between our plant and engineering staff.
*1.Yield rate
The percentage of products rolling off the production line that pass quality inspections. A 100% yield rate means that no defective products were produced.
*2.Process capability index
An indicator that quantitatively assesses the ability of a given process to meet certain quality standards.
*3.Mother plant
A plant that applies new technologies developed in Japan before they are adopted at overseas subsidiary plants.

1. Engaging the Local Community
Our combined plant tour and health walk event has been held every year since 2006
and is now an annual fall event. We welcomed some 200 people, many local
residents, to last year’s event in November 2011. After taking the plant tour,
participants trekked the “Kaze no Michi” road from the Kojima Culture Center toShimotsui, enjoying the brisk late-autumn weather along the way. We plan tocontinue this event in coming years since it is the perfect way to interact with local
residents and show them what we do at the Mizushima Plant.

Getting ready for the walk2. Comprehensive emergency drill
The Mizushima Plant conducts comprehensive emergency drills every September inconjunction with Disaster Prevention Day. Local fire departments and theMizushima Industrial Complex’s joint disaster prevention team join our in-house firefighting team in training, with each team perfecting their own response skills.

An emergency response drill-6-FY2012 CSR Website CSR > Site Reports > Worksites > Mizushima Plant

3. Local volunteering
In an effort to support and cheer up local residents, the Mizushima Plant held its first
volunteer neighborhood cleanup on April 27, 2006. We counted our 22nd cleanup in
2011. Our original intention will continue to inspire us as we hold this activity infuture years.

Plant volunteers picking up litter-7-