Initiatives that support value creation

Environment

ISEKI Group promotes environmentally-friendly design in the entire product development process with the aim of
reducing the environmental burden in each of the stages of development, manufacture, use by customers, anddisposal, and strives to offer environmentally-friendly products.

Preservation of biodiversity

ISEKI Group’s business activities as well as agriculture, which uses agriculture equipment and services, exist thanks tobenefits of ecosystem services.

Eco-product certification system[ISEKI Group’s Biodiversity Guidelines]
performance through notablefunctions● Environmental burden reduction ofSuper-eco product10% or more in usage

Super-ecoproductXX environmental burden reduced by YY%(compared to ZZZ’s conventional model)

Product that has
cleared in-housestandard

Eco-productEco-product certification trend
In addition to products featuring functions that contribute to energy andlaborsavings at customers, the certification of products installed withengines conforming to the strengthened emission regulations in Japanand abroad has been increasing each passing year. The number of suchproducts accounted for 36.6% of domestic sales in FY2019.

Number of certified eco-products and ratio
Number of certifications (equipment type)
Ratio of eco-products (Net sales in Japan)

28.7%

12.7%

1720162921

2017

1. ISEKI Group will strive to preserve biodiversity by considering the impact on biodiversity at all stages of its businessactivities, and by reducing the harmful load discharged into the environment from all offices.
2. ISEKI Group will strive to preserve biodiversity by offering biodiversity-friendly agricultural machinery and facilities thatare safe and easy-to-use, and by supporting sustainable agriculture and initiatives aimed at preserving rivers and othernatural resources.
3. ISEKI Group will strive to develop and popularize technologies that will contribute to preservation of biodiversity bypromoting technological development that learns from nature’s blessings and traditions.
4. ISEKI Group will strive to share the awareness regarding biodiversity by establishing communication with various
involved people including stakeholders and local communities and collaborate with them so as to make the initiatives forpreserving biodiversity more effective.
5. ISEKI Group will strive to improve awareness regarding nurturing of biodiversity preservation by the society as a wholeby implementing environmental education of its employees.

ISEKI Group’s environmental and corporate risks
35

ISEKI Group has been working on reducing risks and developing equipment by grasping the impact of its business activities on biodiversity.
Examples of risk reduction and equipment development

6
2015

Specific initiatives

36.6%

32.6%

20.1%

2018

2019

● Environmentally-friendly design● New technologies and services

Eco-products
Variable fertilizing ricetransplanter, etc.

Plant growth diagnosis device
Plant factory● Biodiversity preservation● Conservation of rural villages

Examples of certified products
Operesta NP80D, variable fertilizing rice transplanters with soil sensor and straight-travel assisting function Energy saving, laborsaving Resource saving
The rice transplanter, certified as a super-eco product, is a variable fertilizing rice transplanterthat enables laborsaving and lower cost by reducing plant lodging and the amount of fertilizer
through its optimal application.
It is also installed with the automated straight-travel assisting function that allows anyone
to carry out easy and straight-line planting, which reduces fatigue of the operator and makes
the operation more efficient. It eliminates the necessity of adjusting the amount of water inpaddy even if the level of water is high and the marking is not visible, contributing to watersaving and maintaining water quality.

Large grass collector front mower SF5 series Energy saving, resource saving

Value creation of ISEKI Group● Realized outstanding environmental

Example of environmental label

Fundamental concept
ISEKI Group acknowledges the fact that it benefits from the blessings of nature (ecosystem services) that biodiversity produces,and therefore it has positioned preservation of biodiversity as a priority task of its environmental management. In cooperation
with local communities and various stakeholders, the ISEKI Group will contribute to the realization of a sustainable society thatcoexists with nature by promoting business activities and offering products and services that are biodiversity-friendly as well as
preservation of biodiversity and continued use of the blessings from biodiversity.

Initiatives that support value creation

Eco-product certification system is anin-house system that certifies products withhigh environmental conformance that meet
ISEKI-original evaluation criteria. Certified
products are granted environmental labels,
which are conveyed to customers throughproduct catalogs and user manuals in aneasily noticeable format. Further, theenvironmental label conforms to Type II
stipulated under ISO14021 (self-declared
type that does not need third-party
certification).

ISEKI Group

Initiatives for environmentally-friendly design

Local river preservation activities

and mountain forests

Support for regeneration ofabandoned paddy fields

Corporate
activities
Design development
Procurement
Production
Distribution
Sales

Products andservices
Usage and disposalof products
Pesticides,
chemical fertilizers

INPUT

Major risks to local
environment and biodiversity

Allocation ofresources● Destruction,● Raw materials● Energy● Water resources● Land usage

OUTPUT
Environmentalburden● CO2● Exhaust● Drainage● Wastefragmentation or
elimination of plant andanimal habitat due toexcessive consumptionof resources, illegal
logging, etc.
● Deterioration ofecosystem services
beyond repair of theeco-system● Deterioration or
extinction of plant andanimal habitat due toglobal warming or
atmosphere, water, andland pollution

Major risks tocorporate activities● Increased costs, decreasein productivity or operationstoppage due to shortageof raw materials or energy● Changes or reduction tocrop producing area due toclimate change or waterand soil pollution● Stoppage of operations ordamage to agriculture due
to direct impact ofdisasters caused byabnormal weather● Environmental
performance regulations
on products, etc.

Financial data

Environment

Reduction in environmentally hazardous substances

49

Company information

SF5 series, a front mower installed with Stage V compliant engine that meets the strict
emission regulation of Europe and with improved operational efficiency (5% increase in speed
compared to existing models) as well as reduced time for moving when not cutting grass, hasbeen certified as an eco-product.
The mower, having high horsepower and aimed at the professional landscaping market inEurope where environmental awareness is high, is installed with a clean engine equipped withdiesel particulate filter (DPF), a post-emission processing device, and diesel oxidation catalyst(DOC), which ensures reduced NOx and other emissions compared to conventional models.
The model, in addition to an eco-mode switch for low noise operation in urban areas, hasa high-low toggle switch for blower speed setting, and enables low-noise operationaccording to the surrounding environment.

ISEKI Report 202050