Management ofEnvironmental andSocial Initiatives

Contents

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleESG Databook 2020

Data

SocialContribution
Activities

Index

This publication is the compiled PDF version of Komatsu's webpage"ESG Databook", as of July 18, 2020

■ Management of Environmental and Social Initiatives■ Data003

Materiality (Formulating CSR Themes)

175

Major Environmental Achievements in the previous year009

System for promoting environmental and social(CSR) activities

180

Environmental Education

Our concept of environmental activities andpromotion system

183

Environmental Accounting

188

Site Data

195

Scope of Environmental Data/Calculation Standards

199

Amount of  CO2 Emissions by 2 Scope3

200

Independent Practitioner's Assurance

202

Other CSR Data

010
012

Setting Midand Long-Term Targets and Progress015

Organizational Chart of the Environmental
Management Structure016

Acquiring ISO14001

017

Dialogue with Our Stakeholders019

Major Achievements

024

Comparison with Global Principles

026

External Evaluations

031

Green Bond

■ Social Contribution Activities■ Theme 1 : Enhancing Quality of Life
035

Improving Product Safety and Solutions

037

Quality and Reliability - Responsible Commitment
to Customers -044

Relationship between Business Activities andthe Environment

046

Climate Change056

Our Challenge to establish Recycling-based Society

Personnel Policy and Performance Appraisal System

069

Diversity Initiatives

075

Enhancing Work-Life Balance080

Employee Training Structure082

Enhancing the KOMATSU Way

085

Strengthening Our "Gemba" Capability

088

Brand Management Initiatives

Corporate Governance096

Corporate Governance Indicators

101

Compliance105

Human Rights Policy

107

Business and Human Rights

108

Risk Management112

Occupational Safety and Health122

Outline of Procurement Policy and Supply Chain129

CSR Procurement Guidelines

136

Support for Member Companies of the Komatsu
Midori-kai (Management and Society)145

Our Suppot for Midori-kai member companies（Environment）

152

Safety and environmental initiatives at sales andservice companies

154

Environmental Risk Management

165

Biodiversity

170

Communication with Stakeholders

206

Komatsu's Initiatives for the Social Issues

208

Developing People Needed by the Community

209

Collaboration with Cummins Inc.

211

Disaster Relief

213

Clearing Anti-Personnel Landmines and Community
Development Support

217

History of Demining Activities (International Treaties,
Japanese government and Komatsu)

219

Promoting Sports—The Komatsu Women's Judo Club223

GRI STANDARDS INDEX

237

SASB Content Index

E d i to ri a l P o l i c y
These reports principally cover data for the period
from April 2019 to the end of March 2020, withsome non-periodic information on continuing
efforts.
About the report which doesn't cover all ourdomestic and overseas consolidated Group companies, we stated the scope of report in eachpage.
The date of the previous report is July 2019. We
publish these reports every July, and the next issue
will be published in July 2021.
Please use this form to send us any questions
regarding our reports.
The reports contain Standard Disclosures from the
GRI Sustainability Reporting Standards. You can see
a list of the Standard Disclosures and their locationin our report here.
Komatsu has received an independent practitioner's
assurance on important quantitative data inenvironmental reporting, which can be viewed here.

■ Theme 3 : Growing with Society
093

Accomplishments and Approaches for Social
Contribution Activities■ Index■ Theme 2 : Developing People
063

204

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ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Management of Environmental and Social Initiatives

003

Materiality (Formulating CSR Themes)009

System for promoting environmental and social (CSR) activities

010

Our concept of environmental activities and promotion system

012

Setting Midand Long-Term Targets and Progress015

Organizational Chart of the Environmental Management Structure016

Acquiring ISO14001

017

Dialogue with Our Stakeholders019

Major Achievements

024

Comparison with Global Principles

026

External Evaluations

031

Green Bond2

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Materiality (Formulating CSR Themes)

マテリアリティ（重点活動分野の策定）
Materiality(Formulating
CSR Themes)
Komatsu formulated its CSR themes in 2010, placing CSR activities as the ones to respond to social needs through core business, upon
コマツは2010年に、CSR活動を「本業を通じて社会の要請に応えていく」と位置づけたうえで、社会とコマツ双方に
muchdiscussion on de ning initiatives that would both be of value to society and to Komatsu.
とって価値ある活動が何か議論を重ね、「CSR重点分野」として策定しました。
Also,in
the Mid-Term Management Plan announced in April 2019, we touch upon the growth strategy in our core business in relation
2019年4月公表のF期経営計画においても、本業における成長戦略と「CSR重点分野」を結び付けて議論し、「本業with
our CSR themes, and are striving for sustainable growth through a positive cycle of improving earnings and solving ESG issues.
Inを通じた収益向上とESGの課題解決の好循環」による持続的成長を目指しています。
addition, even in social contribution activities that do not aim at direct pro tability, we strive to contribute to society in a way that
また直接的な収益性を目的としない社会貢献活動においても、CSR重点分野に沿った活動を通じ、本業の強みを活か
draws
on the strengths of our core business through initiatives aligned with our CSR themes.

した社会還元に取り組んでいます。

Komatsu's procedure to identify CSR material issues
CSR重点分野策定のステップ
In 2010, with the support of Business for Social Responsibility (BSR), a nonpro t organi2ation, Komatsu undertook a materiality

assessment to accomplish the following objectives:
CSR重点分野を整理する過程において、第三者としてNPO法人である米国BSR（Businessfor Socil Responsiiliy）からの支援 をうけなが
1.ら、以下のステップを踏みました。
Identify a set of CSR issues and prioriti2e these issues by their relevance to our business and importance to our stakeholders
2.1. Dene a set of global CSR themes and activities
コマツが本業を通じて貢献できるCSR優先課題を選定
2.Fromグローバルに共有できるコマツのCSR重点分野・重点活動を策定
an extensive list of CSR issues, we selected those relevant to Komatsu as a construction/mining and industrial equipment
manufacturer.
We then evaluated CSR issues based on their importance to our business. To understand the relevance of CSR issues to
まは、数多い社会的課題のなかから建設・鉱山・産業メーカーとしてコマツに関連あるものを抽出し、次にそれぞれの社会的課題に
ourbusiness,
weinterviewed senior executives across our company, including the heads of regions outside Japan. These interviews
ついて「コマツの事業にとって重要であるか」について評価しました。事業への重要度を理解するたに、社内役員や海外現地法人の経営
helpedus
inunderstanding
the degree to which
CSR issues impact our business priorities and operations. We then evaluated CSR
トップへのインタビューも実施しています。
さらに、それぞれの社会的課題が「コマツが大切にするステークホルダーにとって重要である
issues
based
on
their
importancetoourstakeholders.
To understand the relevance of CSR issues to our stakeholders, we reviewed
か」についての評価を行いました。
ステークホルダーへの重要度を評価するに当たっては、政府・政策担当者や業界専門家、メ2ィア、顧external
reports, viewpoints, and public statements published by governments and policy makers, issue experts and advocates, media,
客（建設・鉱山関連）、サプライヤーなどによる発言や発行物などを参考にしました。また、ステークホルダーの視点を反映するたにsuppliers,
and customers. We also took into consideration the BSR's view of stakeholder importance.
BSR社の助言も取り入れています。

Evaluating
CSR issues
社会的課題の評価
We
evaluated CSR issues based on the degree of importance to our business shown on the hori2ontal axis, and the degree of
コマツの事業にとっての重要性を横軸に、ステークホルダーにとっての重要性を縦軸に、社会的課題の評価結果を整理しました。
importance to our stakeholders shown on the vertical axis.

The CSR issues of more importance to both businesses and stakeholders are placed in the top right quadrant. We narrowed our focus to
右上に配置された社会的課題は、コマツの事業とステークホルダーの双方にとって重要な社会的課題（=CSR優先課題）と位置づけられ、そsixteenmaterial issues across six categories. By focusing on these material issues that have the most impact on our business andのFからコマツのCSR優先課題として次の16項目を選定しました。これらの優先課題に注力することにより、本業を通じた最も有効な社会
stakeholders, we believe that we are in a strong position to leverage our core strengths as an equipment manufacturer, and create
的活動を遂行できるものと考えます。
lasting social impact going forward.

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ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Materiality (Formulating CSR Themes)

Komatsu's CSR Priorities
Products, Services, and ustomers

Products that enhance safety
Responsible marketing and customer support

Environment

Environmentally-friendly products
Environmental e ciency (facilities, such as plants, and job sites)
Remanufacturing

Employees

Human resource development
Safety and healthRespecting employees

Human ights

Respecting human rights
Equal employment

Ethics and overnance

Cooperation with stakeholders
Corporate governance and compliance
Collaboration with business partners to comply with social regulation

Local ommunity

Development of local communities
Disaster relief
Improving local residents' quality of life

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ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Materiality (Formulating CSR Themes)

Formulating CSR Themes and Key Business Activities
We identied three CSR Themes via a two-pronged approach, basing them on our material issues and through internal/external
dialogues within the company and with BSR.

Komatsu's CSR Themes
Enhancing uality of ife-Providing products required by societyDeveloping People
Growing with Society
In order to achieve our goals for each of the three areas, we have determined priority activities that align with the mid-term
management plan as “activities through our core businesses”. In addition to its main business, Komatsu believes it is the
responsibility of a business to engage in “social contribution activities” in the local community where business is conducted.
Komatsu is engaging in the following social contributory activities that make the most of the know-how developed in our main
business.
CSR Themes

Key usiness Activities
Activities through the core businessSocial Contribution Activities

Enhancing Quality ofLife-Providing products
required by society -• Provide products, service and solutions
contributing tosustainable development of infrastructure,
natural resources andcircular environmental protection(remanufacturing and forestry).
• Improve productivity, eciency, safety andenvironmental impact(lower CO2 emissions and higher ratio ofrenewable energy use)through innovations, such as automation in theentire value chain.
• Make commitment to DANTOTSU Value which
will reali0e better
Earth and future by means of technology andreliability (creation andmaximi0ation of customer value).

Promoting environmental eciency & safety
through initiatives not directly related to thebusiness
Providing products, services, know-how
required by society for free of charge

Developing People• Develop a diverse workforce with a high level ofproductivity and technical skills.
• Strengthen and develop diverse and globalscope talent
to help achieve sustainable workplaces.
• Develop talent with cross-value chain
capabilities

Support the development of people in local
communities
Development of next generation

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ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Materiality (Formulating CSR Themes)

CSR Themes

Growing with Society

Key usiness Activities
Activities through the core businessSocial Contribution Activities• Oer resolutions for social issues throughcollaboration
with stakeholders.
• Act as a responsible corporate citi1en ensuringcorporate
governance, compliance, and human rights.

Disaster Relief
Social Contribution utili1ing core strength andknow-how

Komatsu's CSR and SDGs (Sustainable Development Goals)
In light of the emphasis on corporate eorts towards ESG (Environmental, Social, Governance), Komatsu announced the Mid-range
Management Plan in April 2016 which stated that Komatsu places emphasis on ESG. In incorporating ESG into the Mid-range
Management Plan, we re-examine the relationship between Komatsu's business and CSR initiatives, reveal the direction we are
currently taking, and how Komatsu's CSR activities link to the SDGs (Sustainable Development Goals) adopted by the United Nations as
a common goal aimed at by the international community.
SDGs (Sustainable Development Goals)
The SDGs, ocially known as the 2030 Agenda for Sustainable Development is a set of 17 goals with 169 targets covering abroad range of sustainable development issues, which was adopted at the United Nations General Assembly in September,
2015.

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ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Materiality (Formulating CSR Themes)

SDG Goals and Selection Process
Based on the discussions, we did a thorough analysis to compare the 17 SDG goals and their accompanying 169 SDG targets with our
CSR activities and themes. We evaluated 1) whether there is a relation, and 2) the depth of the relation.
[Table 1: Komatsu's CSR priority areas / Priority activities and SDG goals]

For example, one of our CSR activities is providing products and services that contribute to infrastructure development and improve
the quality of life. For each SDG goal and target, we compared our activity: For example, for SDG Goal #1, we compared as follows;<Example 1> SDG Goal #1 (No poverty)
SDG Target 1.1 (By 2030, eradicate extreme poverty for all people everywhere, currently measured as people living on less than $1.25
a day)In this instance, we did not see a direct relation.
SDG Target 1.2 (By 2030, reduce at least by half the proportion of men, women and children of all ages living in poverty in all its
dimensions according to national de nitions)
In this instance, we did not see a direct relation.
SDG Target 1.5 (By 2030, build the resilience of the poor and those in vulnerable situations and reduce their exposure andvulnerability to climate-related extreme events and other economic, social and environmental shocks and disasters), we believe
there is an indirect relation, and thus colored the cell light blue to indicate the connection. (Refer to ① in the Table 1)
In the same manner, we compared as follows;<Example 2> SDG Goal #9 (Industry Innovation and Infrastructure)
SDG Target 9.1 (develop quality, reliable, sustainable and resilient infrastructure, including regional and trans- border infrastructure
to support economic development and human well-being).
We colored the cell rich blue because there is a strong relation with our key theme. (Refer to ② in the Table 1)
The same process was followed for all SDG targets and all of Komatsu's CSR activities. On Table 1, the number in the cell represents the
SDG target(s) where there is a relation, and the color (dark/medium/light) indicates the depth of the relation (direct or indirect).
According to the team's analysis, ve SDG goals have a strong relationship with Komatsu's three CSR Themes. By focusing on these ve
SDG goals, Komatsu contribute to all the SDG goals comprehensively since it is proved that each SDG goal is mutually intertwined.

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ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Materiality (Formulating CSR Themes)

The ve SDG goals are#8
Decent work and economic growth#9
Innovation and Infrastructure#13
Climate action#17
Partnerships for the goals#11
Sustainable Cities andCommunities

Table 2 explains how Komatsu's business and CSR activities contribute to the ve SDG goals and targets that have the strongest ties to
Komatsu's business.
[Table 2: Co-relation between SDG Goals and Komatsu Business/CSR]

Our next steps are to engage with additional internal and external stakeholders, share this information and follow the Plan-Do-CheckAct method to validate the analysis and establish an action plan.
Following this analysis, we are now reviewing what additional opportunities exist for Komatsu to make an increased contribution to theachievement of the SDGs, focusing on SDGs 8, 9, 11, 13, and 17. We will prioriti.e opportunities that contribute to the SDGs by creating
value for stakeholders and shareholders, and will communicate progress in future Komatsu reports.

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ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

System for promoting environmental and social (CSR) activities

System for promoting environmental andsocial (CSR) activities
Our system to promote CSR

The CSR Department is an organi+ation under the direct control of the President and has established the CSR Committee chaired by the
President, and has the opportunity for top management to regularly discuss the direction of CSR strategy. In addition, the CSR Steering
Committee, which consists mainly of related ocers, conducts discussions on the policy of individual activities, and in particular, is
responsible for governance functions in conducting social contribution activities.
Our CSR activities are integrated to our daily business activities, and we engage in them through dedicated divisions and committeesorgani+ed in all our Group companies. With respect to our major overseas subsidiaries, we communicate with sta responsible for CSR
activities on a daily basis and share information in an eort to bolster our organi+ation and promote CSR activities worldwide.

Reinforcement of Our CSR Systems
Evaluation Tools for CSR Activities

We evaluate new initiatives to determine whether they are benecial to both our business and our stakeholders. Of particularimportance are social contribution activities (donations), which we have monitored diligently with regards to their eectiveness as CSR
activities since FY2013. This is carried out using a donation check sheet that we created to assess quantitative eects via two
perspectives (our business and our stakeholders), which is then evaluated by our CSR Steering Committee upon completion.

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ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

System for promoting environmental and social (CSR) activities / Our concept of environmental activities and promotion system

Global Information Sharing
Prior to FY 2015, information on CSR activities implemented in overseas subsidiaries were obtained through questionnaires that werecollected periodically. We have since updated this system in order to increase its reach and eectiveness; the information is now
updated daily on a bulletin board so that it can be disseminated on a global scale through the intranet.
In addition, overseas subsidiaries set up places for exchange of opinions through individual visits, e-mail, telephone, etc., for about 30
persons in charge who are responsible for the CSR activities of each company to share current status globally. In the future, bycollecting various opinions from various areas of the world, we will create a system to comprehensively understand and share what isrequired on the front lines of the business sites.

Our concept of environmental activities andpromotion system

Komatsu Earth Environment Charter and Environmental
Policy of plants in Japan
Komatsu Earth Environment Charter (June 2010 revision)
Corporate Principles

1. Contributions to Realization of Sustainable Society

Mankind must not only promote the further growth of a rich and comfortable society but also pass down this indispensable
environment of our planet earth to future generations in a sound and healthy condition.
We, at the Komatsu Group, dene environmental conservation eorts as one of the highest priority management tasks, and endeavor
to contribute to the sustainable growth of society by integrating advanced technologies into environmental conservation eorts in all
our business activities. This is represented by our hybrid construction equipment which features a substantial reduction of CO2
emissions while in operation and by our superior manufacturing.

2. Simultaneous Realization of Environmental and Economic Performance

We are committed to improving both environmental performance and economic eciency, as a group of companies working toward
superior manufacturing for customer satisfaction. To this end, we constantly take up the challenge of advancing technologies todevelop creative products that improve both environmental performance throughout the product's life cycle and the product's
economic performance at the same time.

3. Observance of Corporate Social Responsibility

Each company of the Komatsu Group promotes environmental conservation by not only complying with the applicable laws andregulations of the concerned host community, region and country but also by establishing its voluntary standards which consider
global and local environmental concerns. Each company of the Group also strives to fulll its corporate social responsibility by actively
participating in local environmental conservation programs and thereby promoting close-knit communication with local communities,
while striving to become a company trusted by all Komatsu stakeholders.

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Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our concept of environmental activities and promotion system

Guidelines for Corporate Activity
1. Basic Stances on Earth Environmental Problems

We, at the Komatsu Group, work for sustainable society and earth environment through our global business operations by addressing
the following four environmental problems with the stances discussed below.

1)Climate Change

We will reduce the use of energy and emissions of greenhouse gas in all phases of our business activities ranging from research anddevelopment, procurement, production and logistics to sales and service as well as in the total life cycle of our products and services.

2)Establishment of a Sound Material-Cycle Society

Through our business processes, we work to minimize the use of natural resources, such as materials and water, promote their re-use
or recycle them as much as possible, and expand Zero Emissions from our manufacturing activities around the world. At the same time
we ensure the thorough management of waste materials in all our business domains, including our suppliers and distributors.
We also continuously work to increase the recyclability rate of products at the time of disposal.

3)Conservation of Air, Water and Other Environments as well as Management of Chemical Substances

We comply with not only local laws and regulations but also with our established standards concerning the conservation of water
quality, prevention of air pollution, noise and vibrations.
As much as possible, we also ensure the thorough management of chemical substances for use in our business activities, while
continuously reducing the use of potentially harmful chemical substances or replacing them with alternative substances fordiscontinuation of their use.

4)Biodiversity

We recognize biodiversity as one of the important issues concerning the earth environment, evaluate, understand and analyze impact
on it in all our business domains, and work on our tasks according to the criteria of the highest impact and/or the most eective
actions.

2. Framework of Global, Group-wide Environmental Management System

The Komatsu Head Oce, as well as the manufacturing facilities and main companies of the Komatsu Group, already with ISO
certications, will work to maintain and improve their environmental management system, while other manufacturing facilities andsuppliers will also work to establish their environmental management systems and reduce their environmental impact.
The Komatsu Environmental Committee develops environmental action plans and common guidelines for the Komatsu Group. Basedon these Group-wide plans and guidelines, each division or company sets up its own mid- to long-term targets, develops andimplements specic action plans, reviews them regularly and works to continuously improve them.

3. Environmental Education and Communication

We believe that it is important to enhance the environmental awareness of each and every employee and thereby actively promote
environmental awareness and education programs for all employees.
We will gather environment-related information concerning not only our manufacturing facilities but also other related entities, such as
major aliated companies and suppliers, and strive to disclose such information, thereby facilitating proactive communication with all
our stakeholders, such as customers, employees, local communities and suppliers and further expanding the content of environmental
communication.

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ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our concept of environmental activities and promotion system / Setting Midand Long-Term Targets and Progress

Environmental Policy of plants in Japan
Awazu Plant（44KB）

Kanazawa Plant（134KB）

Osaka Plant（71KB）

Oyama Plant（113KB）

Ibaraki Plant（13KB）

Koriyama Plant（91KB）

Himi Plant（194KB）

Hiratsuka district（40KB）

Environmental Policy Test Engineering Center（59KB）

To view PDF les you will need to download and install
Adobe Acrobat Reader

Setting Mid- and Long-Term Targets and Progress
Komatsu has been moving forward under the new mid-term management plan from 2019. We set new ESG targets and expressed ourcommitment to sustainable growth through a positive cycle of pro t improvement through growth strategies and initiatives for ESG
issues.
Our targets from scal 2019 are to reduce CO2 emissions from products and production by 50% by 2030. In addition, as a new indicator,
we decided to aim for a ratio of 50% of renewable energy power (RE ratio) by 2030.
The new mid-term 2030 targets, including other indicators, are as follows:

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ESG Databook 2020

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Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Setting Midand Long-Term Targets and Progress

Mid- and Long-term targets
Area

Application

Products

Construction
Equipment
MiningEquipment
Forestmachines

Production

ObjectBase Year

2030 argets

FY2019
Achievements
and rogress

CO2

Fuel
Consumption
Reduction

2010

50％
reduction

14%
reduction

CO2

Improvement
rate of basic
unit

2010

50%
reduction

31.5%
reduction

Electricity

Ratio ofrenewableenergy in
totalelectricity
usage

-

50%

10.7%

Water

Improvement
rate of basic
unit

2010

60%
reduction

49.4%
reduction

Waste

Improvement
rate of basic
unit

2010

40%
reduction

12.7%
reduction

Japan

CO2

Improvement
rate of basic
unit

2006

39%
reduction

24.8%
reduction

Overseas

CO2

Improvement
rate of basic
unit

2011

22%
reduction

0.6% increase-

CDP
A List（Climate,
Water)DJSI World

CDP
Climate：A
Water：ADJSI World:
Selected

Domestic
andoverseas
production
bases

Logistics

External
evaluation

Index

-

-

External
evaluation

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Setting Midand Long-Term Targets and Progress

SBT (Science-Based Targets) Approved
Komatsu's CO2reduction objectives have been certied by SBT as of April 11, 2017.
SBT (Science-Based Targets) is an initiative that involves “setting goals that arecompatible with science.”
The COP21 (Paris Agreement) marked the introduction of a new set of CO2reduction
objectives that were submitted by various countries. However, even with thesummation of target values, it was found that it would be impossible for theincrease of average global temperatures in 2100 to be stay within 2℃ (as compared
to temperatures before the Industrial Revolution).
Therefore, after a detailed examination by the businesses of the world, reduction
objectives have been reassessed and SBTi (SBT initiative: CDP, Global Compact,
WRI, WWF) is supporting and approving SBTs to reach the goal of an increase of lessthan 2℃.
Komatsu 's SBT meets the requisites of the temperature increase of less than 2℃
scenario.
Komatsu 's SBT are as follows
1. SCOPE1+2: Base unit -49% (Target Year 2030; Base Year 2010)
2. SCOPE3: Total -46% (Target Year 2030; Base Year 2012)* Note: While Komatsu's 2015 medium and long-term objectives (2020 and 2030 respectively) dier from SBTi in terms of a few requisite
conditions (such as using the same base year for assessing both domestic and overseas operations) and target values, the targeted rates of
reduction are comparatively equal.

Organizational Chart of the Environmental Management
Structure

14

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Organizational Chart of the Environmental Management Structure

15

ESG Databook 2020

Management ofEnvironmental andSocial Initiatives

Contents

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Acquiring ISO14001

Acquiring ISO14001
Komatsu has implemented a Group-wide initiative to acquire ISO14001 certi cation, aninternational standard for environmental management systems. The objective is toenhance management quality by strengthening systematic steps towards environmental
conservation.

ISO14001:2015
Domestic Integrated Certi cation《Komatsu ISO Certi cation Status》 *Except KMC
From
1997

Production sites in Japan and other countries began to acquirecerti cations individually.

2008

The Komatsu Group in Japan acquires integrated certi cation.

2015

Main production sites* in overseas countries achieve 100% certi cation.

From
2018

Sales and service divisions are added to integrated certi cation in Japan.
2018: Komatsu Customer Support Japan Ltd.
2019: Four bases (Nagoya, Osaka, Hiroshima, Fukuoka) of Komatsu
Industries Corp.

Scope of the Integrated Certi cation in Japan
Scope of the Integrated Certi cation in Japan (182KB)

Global Operations List of certi ed sites
Global Operations List of certi ed sites（108KB）

To view PDF les you will need to download and install
Adobe Acrobat Reader

16

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Dialogue with Our Stakeholders

Dialogue with Our Stakeholders
Creating a Variety of Opportunities for Dialogue

Engaging in dialogues with our stakeholders is essential for determining the relative eectiveness of Komatsu's management andbusiness operations in terms of meeting social needs. Every department that has direct contact with our stakeholders strives to create
an environment of transparency and integrity by detailing our company’s current situation, receiving feedback, and engaging ineective discussions.
Stakeholders

Customers

Business Partners

Distributors

PurposesExaples of eetings andActivities

Collaborate to reali+e customers'
goals and fulll corporate
responsibility

Brand Management Activities

Collaborate to resolve issues insociety and in the regions where we
operate, and participate in local
activities

Daily

Daily

President explains businessperformances, policies andstrategies

Various meetings with Midori0kai

Conduct safety patrols and provide
opportunities such as for support ofeorts for obtaining certication

3 times a year
As needed

Explanation by the President on
business performance, policies andstrategies
Explanation by the President
business performance, policies andstrategies

Employees

Frequency

Dialogue with the labor union andemployee representatives toimprove the workplaceenvironment

17

Distributor meetings in each region

Annually

Meetings with the President

2 times a year

Sharing Q&A session content with
global employees via the intranet

As needed

Regular Meetings between
Management and Labor Union

As needed

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Dialogue with Our Stakeholders

Stakeholders

PurposesExaples of eetings andActivities
Meetings with residents of the local
community near the plant

As needed

Local Community

Explanation of initiatives related tooperations, the environment andsafetyActivities to resolve local issues
based on employee suggestions

Voluntary activities by employees

Daily

Exchange of ideas and opinions
between representatives such asuniversity professors and our Chief
Technology O cer

Komatsu Science and Technology
Collaboration Council

Biannually

CEO and CFO explanation ofbusiness performance, policies andstrategies

IR Meetings

Japan: Daily
USA and Europe:
Annually

Respond to inquiries and SRI
surveys

SRI Surveys

Daily

CEO and CFO explanation ofbusiness performance, policies andstrategies

Shareholders Meetings

2 times a year, held inJapanPlant tours and explanation ofoperations

Plant tours for shareholders

About twice a year inJapan

Industry-Academia
Collaboration Partners

Investors

Individual
Shareholders

18

Frequency

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Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Major Achievements

Major Achievements
ESG Solutions through Three Pillars of Growth Strategies
Komatsu seeks to help resolve ESG issues by promoting the three pillars of growth strategies de ned in the new mid-term management
plan. We strive to realize a positive cycle of sustainable growth through improvements of earnings and resolutions to ESG issues. Our
initiatives include reducing environmental impacts to combat climate change and supplying high-quality, high-performance products,
services, and solutions ensuring safety. KPIs have been set to guide these initiatives solving ESG issues through our core business.
CSR Themes

ESG Solutions through Three Pillars of Growth Strategies

Enhancing Quality of Life
—Providing Products
Required by Society—

Provide products, service and solutions contributing to sustainable
development of infrastructure, natural resources and circularenvironmental protection (remanufacturing and forestry).
Improve productivity, e ciency, safety and environmental impact (lower
CO2 emissions and higher ratio of renewable energy use) throughinnovations, such as automation in the entire value chain.
Make commitment to DANTOTSU Value which will realize better Earth andfuture by means of technology and reliability (creation and maximizationof customer value).

CSR Themes

Relevant SDGs

FY2021 KPIs

FY2019Performance

Reduction of CO2 emissions from product use (fuele ciency equipment, hybrid hydraulic excavator, rateof SMARTCONSTRUCTION use, enhancement of ICTintensive construction, mine automation, andunderground mining equipment)

16% reduction (incomparison to FY2010)

14% reduction

Reduction of CO2 emissions from production (plants
with zero impact on environment and workers)

40% reduction (incomparison to FY2010)31.5% reduction●

Rate of renewable energy use (including purchase ofrenewable energy)

15％

10.7%

Work environment burden coe cient (particle
matter density)

30% reduction (incomparison to FY2018)

10.7% reduction

Water consumption

55% reduction (incomparison to FY2010)49.4% reduction

Key Initiatives under New Mid-Term Management Plan
Reduction of CO2 emissions (in comparison to FY2010)●

Enhancing
Quality of Life
—Providing
Products
Required bySociety—●

Plants with zero impact on environment and workers

●

●

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Major Achievements

CSR Themes

Key Initiatives under New Mid-Term Management Plan

FY2021 KPIs

FY2019Performance

Value chain reforms and rede nition of the aftermarket business
Spare parts sales

11% increase

3% increase

Reman component lifespan (compared to newcomponents)

20,000 workhours (100% of
new components)

26,866
workhours(134% of newcomponents)

380 units (aggregate)

221 units●●

Assurance of mine operation safety and productivity
AHS units’ population (promotion of mining platformbusiness)●

DANTOTSU Product, DANTOTSU Service, and DANTOTSU Solution
ICT-intensive equipment introduced(United States,
Europe, and Australia)

1,590 units (per year)

1,361 units

Sites adopting SMARTCONSTRUCTION

4,850 (per year)

2,440

Test introduction of
hydraulic excavators forautomated loading

Veri cation tests
conducted onuser sites

Entry into mining bulldozer
market (level 4 automation)

Preparations
advanced tolaunch mining
bulldozer withlevel 2
automation

3. Automation of utility equipment

Development of technology
for automated forklifts

Development of
peripheral
safetytechnologies forsupporting
automation

4. Enhancement of mining equipment and hard rockmining businesses

Expansion of product series

Under
development

Japan: Expand lineup of
agricultural loaders
Indonesia: Increase numberof users of agricultural
techniques employing
agricultural bulldozers

Japan:
Commencementof veri cation
tests at ve
agriculturebusiness
operators
Indonesia:
Started mass
production andsales of D31PLL
agricultural
bulldozer●●● Automation, autonomous operation, electri cation,and remote-controlling of equipment

Enhancing
Quality of Life
—Providing
Products
Required bySociety—

1. Automation of construction equipment
2. Automation, autonomous operation, and remote
operation of mining equipment

Agricultural solutions and smart forestry

Creation of construction equipment demand in
agricultural eld●

20

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Major Achievements

CSR Themes

Key Initiatives under New Mid-Term Management Plan

Enhancing
Quality of Life
—Providing
Products
Required bySociety—●

FY2019Performance50

101,900 units (including forinternal use)

865 units

IoT and ICT work reforms
Sales in KOM-MICS platform business (visualizationof production equipment operation)●

CSR Themes

ESG Solutions through Three Pillars of Growth Strategies

Relevant SDGs

Develop a diverse workforce with a high level of productivity and technicalskills.
Strengthen and develop diverse and global-scope talent to help achievesustainable workplaces.
Develop talent with cross-value chain capabilities.

Developing People

CSR Themes

Smart forestry projects

FY2021 KPIs

Key Initiatives under New Mid-Term Management Plan

FY2021 KPIs

FY2019Performance

Development of a diverse workforce with a high level of productivity and technical skills●

Enhancing employee engagement

Work process reforms through expansion of diverse
and exible workstyles●

Developing
PeoplePromotion of KOMATSU Way (global dissemination of
KOMATSU Way)●

Improvement of global
surveys and indexes

Scheduled for
FY2020Total workhours of less than
2,100; introduction of
telework system (Japan)(1) 1,950
workhours perperson/year(2)
Commencementof trial in August
2019

Training hours and numberof participants• Training hours:
31,625 hours(aggregate
hours for allparticipants)• Number ofparticipants:
1,461 in Japan,
307 overseas

Strengthening and development of diverse and global-scope talent to help achieve sustainable workplaces
Revision of role of Japan in global management

Shifting of human resources
to projects andimprovement activities;
globalization oforganizations on by-functionbasis

Human resource
system revisions
started in JapanFoundations for global measures (systems,
frameworks)

Introduction

Preparations
advanced for
introduction

●

●

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Major Achievements

CSR Themes

Key Initiatives under New Mid-Term Management Plan

FY2021 KPIs

FY2019Performance●

Empowerment of female employees ((1) nonconsolidated ratio of female employees, (2) nonconsolidated ratio of female managers, (3) consolidated
ratio of female managers (Japan))(1) 12.5%, (2) 10.0%, and (3)5.0%(1) 12.3%, (2)7.2%, and (3)4.5%Rate of employment of people with disabilities(comply with requirements in Japan)

Above 2.3% (legally
mandated rate)

2.58% (nonconsolidated)

Chile, Australia, South Africa,
others• Humanresource
development
programlaunched inChile• Ongoingsupportprovided in
Peru, South
Africa, andAustralia• Participants’success innding
employment
tracked430 (aggregate)

396●

Developing
PeopleSupport for regional human resource development
for job creation (regional human resource developmentwith Cummins Inc.)●

Development of talent with cross-value chain capabilities
Cultivation of SMARTCONSTRUCTION consultants(capable of proposing solutions using ICT to improve
productivity and safety throughout construction
workplaces)●

CSR Themes
Growing with Society

CSR Themes

ESG Solutions through Three Pillars of Growth Strategies

Relevant SDGs

O er resolutions for social issues through collaboration with stakeholders.
Act as a responsible corporate citizen ensuring corporate governance,compliance, and human rights.

FY2021 KPIs

FY2019Performance

Promotion of Brand
Management and activities
creating value for customers

Examination of
cutting-edge
tools throughactivities
with domestic
customers andregional
dissemination

Key Initiatives under New Mid-Term Management Plan
Resolutions to social issues through collaboration with stakeholders

Growing withSociety

Promotion of industry-government-academia
collaboration as well as of collaboration with customers●

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Major Achievements

CSR Themes

FY2021 KPIs

FY2019Performance

Shareholders and individual investors (shareholder
meetings, shareholder factory tours, individual investor
meetings)

Number of meetings held

• Shareholder
meetings: 2
times• Shareholder
factory tours:
10 times• Individual
investor
meetings: 7
times• Certain
factory tours
and meetings
canceled due
to impacts ofglobal COVID19 pandemic

Institutional investors (ESG meetings)

Number of meetings held

11 (ESG-related
meetings)

Key Initiatives under New Mid-Term Management Plan

●

●

●

Communities (business site fairs)

One fair held at each of ninefactories per year

Business fairs
at ninefactories(Awazu, Osaka,
Ibaraki,Kanazawa,
Tochigi,
Oyama,
Koriyama,
Shonan, andHimi); canceled
only at Shonan
Plant due toimpacts of
TyphoonHagibis●Employees (meetings)

Number of meetings held

34 (30 in Japan,
4 overseas)

Growing withSociety

Action as a responsible corporate citizen addressing corporate governance, compliance, and human rights
Occupational health and safety, support forestablishing environmental and safety systems at
suppliers, response to Japan’s Corporate Governance
Code (corporate governance reports), evaluations ofectiveness of Board of Directors, internal control, andinternal audits●

23

Ongoing improvements
made in re ection of
relevant laws andregulations and social
expectations

Establishmentof HumanRights Policy,
disclosure in
integrated
reportESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Comparison with Global Principles

Comparison with Global Principles
What Komatsu considers to be material issues are listed in our CSR Priorities, each of which are in line with international standards suchas the ISO26000 and the United Nations Global Compact.
Details on these standards can be found in “Komatsu's Worldwide Code of Business Conduct” and the “CSR Procurement Guidelines,”.

ISO26000 core
subjects/issues

UNGC 0
Principles

Komatsu's CSR Priorities

Organizational
GovernanceCorporate GovernanceCompliance
Collaboration with business
partners to comply with social
regulations

Human Rights

Human Rights
Principle 1
Principle 2

Respecting human rights
Collaboration with business
partners to comply with social
regulations
Development of local
communities
Disaster relief
Improving local residents' qualityof life

LabourPrinciple 3
Principle 4
Principle 5
Principle 6

Providing safe products,
services and solutions
Equal employment
Safety and health
Human resource development
Collaboration with business
partners to comply with social
regulations

LabourPractices24

Incorporation into Komatsu's Internal
Guidelines■: Items of Komatsu's orldwide Code ofBusiness Conduct●: Items of Komatsu Group CSR Procurement
Guidelines“uality and Reliability” of organizational
structure, business operations, employees andmanagement■Emphasis on corporate governance■●Compliance with the Rules■

Respect for human rights
Due consideration to work-life balance■●■

Conversations or discussions with employeesor their representatives■●Zero tolerance for child labor and forced
labor■●Promotion of equal opportunities for
employment, with zero tolerance fordiscrimination and any kind of harassment■●Ensuring a safe and comfortable work
environment■●Human resources management in fair andimpartial manner■

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Comparison with Global Principles

ISO26000 core
subjects/issuesThe
Environment

Fair Operating
Practices

UNGC 10
Principles

Komatsu's CSR Priorities

Environment
Principle 7
Principle Principle Providing environment-friendly
products, services and solutions
Environmental eciency(facilities, such as plants andoperation sites)
Remanufacturing

AntiCorruption
Principle 

Corporate governanceCompliance
Collaboration with business
partners to comply with social
regulations

ConsumerIssuesProviding safe products,
services and solutions
Responsible mar!eting andcustomer care
Providing environment-friendly
products, services and solutions
Remanufacturing

Community
Involvement
andDevelopment

Development of local
communities
Disaster relief
Improving local residents0 'ualityof lifeHuman resources development

25

Incorporation into Komatsu's Internal
Guidelines■: Items of Komatsu's Worldwide Code ofBusiness Conduct●: Items of Komatsu Group CSR Procurement
Guidelines
Providing products, services and systems thatare environmentally-conscious■Environmental protection■Komatsu Earth Environmental Charter■Declaration of Conservation of Biodiversity●Reducing environmental impact,
managing chemical substances and building
up environmental management systems■

Fair and appropriate business operations
Fair and proper relationship with governmental
bodies and agencies■●Never providing, oering or
promising inappropriate money, goods orfavors■●●Providing customers with suitable solutions
and striving to deliver products, services andsystems that are safe, environmentallyconscious and innovative■Environmental protection■●Reducing environmental impact,
managing chemical substances and building
up environmental management systems■

To fully understand its social responsibilities asa corporate citi/en■Groupwide social contribution (5 Basic
Principles for ocial Contribution)■●Good harmony with local communities■

ESG Databook 2020

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Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

External Evaluations

External Evaluations(As of December, 2019)(1) External evaluations for CSR activities (Evaluation for SRI)
[Global][CDP]An NPO that was established in the United Kingdom in 2000 and engages in the surveying
and global disclosure of corporate initiatives with respect to carbon dioxide emissions
and climate change, while simultaneously analyzing and evaluating the surveyed details.
In 2016, it started to run a system aimed at selecting A-list companies, or companies
recognized by the organization as global leaders in terms of the implementation of action
on climate change.
One of the ESG management goals set by Komatsu in “DANTOTSU Value - FORWARD
Together for Sustainable Growth,” the new Mid-Term Management Plan that has been
carried out since scal 2019, is to be selected as an A-list company in reference to CDP’s
areas of focus:climate change and water.
[Trends in the selection of the Company over the last three years]
2017

201

2019

CDP Climate Change

A

A

A

CDP ate

A

A-

A-

[D    D]The sustainability indices were developed by U.S.-based S7P Dow Jones and Swiss-based
RobecoSAM. They analyze and evaluate corporate sustainability from the threeperspectives of the economy, the environment and society to select high-ranking
companies in each industrial sector.
One of the ESG management goals set by Komatsu in “DANTOTSU Value - FORWARD
Together for Sustainable Growth,” the new Mid-Term Management Plan that has been
carried out since scal 2019, is to be included in DJSI World.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected as a component of the “World Index” for consecutive years
since 2006.
DJSI

2017

201

2019

DJSI WorldDJSI WorldDJSI World

26

ESG Databook 2020

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

External Evaluations[MSCI Global Sustainability Indexes*]
The Socially Responsible Investment indexes were developed by U.S.-based MSCI
(Morgan Stanley Capital International), Inc.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected for consecutive years.
[ISS, eo ]The corporate sustainability rating indexes were developed by German-based ISS-ekom.
[Trends in the selection of the Company over the last three years]
Komatsu has been consecutively awarded rime status in the machinery sector.
[  ieoIIS]The ESG rating index was jointly developed by EUR ET, a European stock exchange,
and Vigeo Eiris, a major U.K. and French ESG survey company.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected for consecutive years.

[Japan][S losso a#an Index]
The index, which was established by U.K.-based FTSE Russell, selects Japanesecompanies that implement excellent programs to facilitate ESG.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected for consecutive years.
*FTSE Russell con rms that Komatsu has been independently assessed according to the index criteria, and has satis ed there(uirements to become a constituent of the FTSE Blossom Japan Index. Created by the global index and data provider FTSE Russell,
the FTSE Blossom Japan Index is designed to measure the performance of companies demonstrating strong Environmental, Social andGovernance (ESG) practices. The FTSE Blossom Japan Index is used by a wide variety of market participants to create and assess
responsible investment funds and other products.
[MSCI a#an SG Selet eade$s Index*]
The index is part of those established by U.S.-based MSCI Inc., aimed at selecting listed
Japanese companies with high ESG ratings.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected for consecutive years.
[MSCI a#an  #o(e$in o en Index*]
The index is part of those established by U.S.-based MSCI Inc., aimed at selecting listed
27

ESG Databook 2020

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

External Evaluations

Japanese companies that promote a high level of gender diversity.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected for consecutive years.
*THE INCLUSION OF KOMATSU LTD IN ANY MSCI INDEX, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMESHERIN, DO NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT OR PROMOTION OF KOMATSU LTD BY MSCI OR ANY OF ITS AFFILIATES.
THE MSCI INDEXES ARE THE EXCLUSIVE PROPERTY OF MSCI. MSCI AND THE MSCI INDEX NAMES AND LOGOS ARE TRADEMARKS ORSERVICE MARKS OF MSCI OR ITS AFFILIATES.
[S&P/JPX Carbon E cient Index]
The index is oered by S&P Dow Jones Indices and the Tokyo Stock Exchange formember companies in the Tokyo Stock Price Index (TOPIX). It decides on the investment
weights to be applied to such member companies with a focus on the disclosure ofenvironmental information and level of carbon eciency (carbon emissions per sales).
[Trends in the selection of the company over the last three years]
Komatsu has been selected as index component for consecutive years.

[Certi cations][Copetitive IT Strategy Copany Stock Selection]
This program has been conducted by the Ministry of Economy, Trade and Industry (METI)
and the Tokyo Stock Exchange. It selects outstanding companies among those listed on
the Tokyo Stock Exchange proactively utili9ing and applying IT for management
innovation and the improvement of protability and productivity levels from theperspective of improving corporate value on a medium- to long-term basis andstrengthening competitiveness in each industrial category. Komatsu has been selected fortwo consecutive years since 2019 and for the third time overall.
[SBT]
SBT (Science based targets, namely, science-based emission reduction targets) is an
initiative advocated by the CDP, the United Nations Global Compact, the World Wildlife
Fund and the World Resources Institute. It certies companies that have establishedreduction targets compatible with scientic knowledge aiming to achieve the target
established under the Paris Agreement of keeping the average rise in global temperature
due to climate change below two degrees from the pre-Industrial Revolution levels in theworst-case scenario.
Komatsu’s CO2 reduction targets were certied as SBT in April 2017.
Please click here for further details about Komatsu's CO2 reduction and SBT.

28

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

External Evaluations(2) Evaluations of IR activities[Award for Excellence in Corporate Disclosure from the Securities Analysts
Association of Japan]
Securities analysts developed objective evaluation criteria to decide on the ranking ofcompanies in terms of its quality, quantity, timing and other factors of corporate
disclosures, and based on which established the Award for Excellence in Corporate
Disclosure from the Securities Analysts program. The program has been implemented
since 1955.
Komatsu received the 2018 Award for Excellence in Corporate Disclosure ( rst place in themachinery section). This is awarded every two years and Komatsu has received it eight
consecutive times912 times in total.
[  rand rix Award]
The Japan Investor Relations Association selects member companies that haveconducted excellent IR activities and provides them with the Best IR Awards. In addition,
it gives the IR Grand Prix Award to companies that have received the Best IR Award for thethird time.
In 2017, Komatsu received the IR Grand Prix Award for the second time since 2010.
Including the Best IR Award, this is the sixth time it has received the award, in addition to2007, 2008, 2010, 2013 and 2016. We are the rst rm to have received the Grand Prix
twice.

[oyo Stoc Exchane +SE, -the Corporate alue mpro'ement Award. rand rix]
TSE created the Award program in FY2012, designed to annually award the companies
which have achieved high corporate value by practicing management of improving
corporate value through initiatives that consider capital cost and other investor concerns.
Komatsu was selected for the Grand Prix award of the 8th Corporate alue Improvement
Award (FY2019) from all listed companies (about 3,650).

29

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

External Evaluations(3) Endorsement of initiatives[UN Global Compact]
The Global Compact, which is an initiative advocated at the World Economic Forum in
1999, requests that companies comply with and practice 10 principles with respect tohuman rights, labor, the environment and anti-corruption. Komatsu expressed its support
for the United Nations Global Compact in November 2008.

[ C ]The World Business Council for Sustainable Development 3WBCSD4, whose members
include more than 200 companies worldwide, is an organization that creates surveys andproposals on the economy, the environment and society with a focus on sustainable
development. In addition, it works actively to implement SDGs.
Komatsu decided to support WBCSD in 2010 and has been cooperating in its activities.
[ C]The Task Force on Climate-elated Financial Disclosures 3TCFD4, which is an initiative
established by the Financial Stability Board in June 2017, requests that companies
disclose climate-related information that may aect nancial matters from the four
perspectives of governance, strategy, risk management and metricstargets.
Komatsu expressed its support for TCFD in pril 2019 and has been preparing information
disclosures in compliance with the request.

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Green Bond

Green Bond
Komatsu issued a “green bond”, an unsecured straight bond, through a public oering on the Japanese market. Green bonds aredesigned to raise funds for exclusive use in business which works to help solve environmental problems.
Under the three-year mid-term management plan, “DANTOTSU Value - FORWARD Together for Sustainable Growth” to be completed inthe scal year ending March 31, 2022, Komatsu is making eorts for sustainable growth through a positive cycle of improving earnings
and solving ESG issues. In this management plan, Komatsu upholds ESG management targets of reducing CO2 emissions to 50% andincreasing the ratio of using renewable energy to 50% of total energy use, both by 2030 from 2010. To this end, Komatsu supplies highquality, high-performance products, services, and solutions, that are designed to reduce environmental impacts, particularly in relation
to climate change, and enhance safety. With the proceeds from the green bond, Komatsu is going to further accelerate its eorts to help
reali4e a decarboni4ed society.
【Reference】Press Release(released on July 10th)(Komatsu website)

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Green Bond

Outline of the Green Bond
IssuerKomatsu Ltd.

Pricing dateJuly 10, 2020

Issue dateJuly 16, 2020

Maturity

5 years

Issue amount

JPY10.0 billion

Interest rate

0.130%
Applicable to the following projects:

Use of proceeds

Project A: Responses to environmental problems resulting from the use of productsEorts designed to help reduce CO2 emissions from products in use to 50% by 2030 from 2010(Specically, R&D, the provision and wide use of products, services and solutions).
1) Products: hybrid hydraulic excavators, (applicable for low carbon-type construction
equipment certication by Japan's Ministry of Land, Infrastructure, Transport and Tourism) andelectric construction equipment.
2) Service: Support for fuel-economy machine operation by using IoT.
3) Solutions: Reduction of CO2 emissions by promoting wide use of ICT-intensive construction
equipment and providing applications which support optimi7ation of construction as a whole.
Project B: Responses to environmental problems resulting from manufacturing.
Eorts designed to help reduce CO2 emissions in manufacturing to 50% and increase the ratio ofusing renewal energy to 50% of total energy use, both by 2030 from 2010 (capital investment infacilities and equipment, etc.).
(1) Energy-savings of factories and equipment in plants.
(2) Power generation by using solar panels and biomass as well as purchase of renewableenergies.

Lead manager

Nomura Securities Co.,Ltd.

Green bond structuring
agent*

Nomura Securities Co.,Ltd.

Rating"AA-" from Rating and Investment Information, Inc.

*This organi7ation supports the issuance of green bonds by giving advice regarding the formulation of green bond frameworks and on
obtaining second-party opinions.
Komatsu's green bond frameworks（216KB）

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Green Bond

Second-party Opinion of Green Bond Eligibility
With respect to eligibility against the 2018 Green Bond Principles and the Green Bond Guidelines, 2020, Komatsu has obtained asecond-party opinion from DNV GL BUSINESS ASSURANCE JAPAN K.K. (hereafter “DNV GL”), an internationally recogni;ed third-party
organi;ation with expertise in this eld.
Second-party opinion（956KB）
The cost of obtaining an independent assessment related to the green bond is subsidi;ed by Japan’s Ministry of the Environment in its
2020 assistance project to promote the issuance of green bonds.

List of Investors Who Expressed Their Intention to Invest
Asset Management One Co., Ltd.
OMUTA YANAGAWA SHINKIN BANKThe Kita Osaka Shinkin Bank
The 77 Bank, Ltd.
THE JUROKU BANK,LTD
SUMITOMO LIFE INSURANCE COMPANY
Zentouei Shinyokumiai
Daitokyo Shinkumi Credit Cooperative
NAGANO SHINKIN BANKThe Bank of Nagoya, Ltd.
Nippon Life Insurance Company
THE HIGASHI-NIPPON BANK,LIMITED
Hiratsuka SHINKIN BANK
Fukushima Shinkin Bank
Sumitomo Mitsui Trust Asset Management Co., Ltd.

Reporting
The allocation status of the procurement funds for FY2020 and impact reporting are planned to be released in 2021.

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Theme 1 : Enhancing Quality of Life

035

Improving Product Safety and Solutions

037

Quality and Reliability - Responsible Commitment to Customers -044

Relationship between Business Activities and the Environment

046

Climate Change056

Our Challenge to establish Recycling-based Society

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Improving Product Safety and Solutions

Improving Product Safety and Solutions
Our innovative processes aord us the ability to consistently conceive valuable ideas in multiple elds, such as environmental designand economic eciency. Out of these areas, the one which we consider to be of the most importance is that of “Safety”.
From providing safe products to the overall safety of our automatic operational systems, we persistently utilize the full scope of ourinnovation capabilities to nd ways in which safety is used to maximize the value of our products to our customers.

On-site Operational Safety
The provision of profoundly safe products is the most important
responsibility of any manufacturer. With that in mind, we strive to
exceed what is expected of us by going above and beyond the callof duty. On top of meeting all international standards andregulations, we supplement our products with additional safety
features that remain unsurpassed by our competitors.
This commitment, compounded with our innovative drive forsafety improvement, also allows our customers to achieve theconsummate climate of safety within their operations.

In 2013 and 2014, Komatsu introduced the ICT Bulldozer and ICT Hydraulic Excavator respectively, an innovation that made possible
the automatic control of blades and buckets. These systems by-pass the need for manual experience, allowing even fresh or lessexperienced workers to perfectly reproduce the same high-level precision construction work of a skilled worker. This has eliminated thepast need for ancillary workers and guiding processes, thus enabling our customers to make huge savings on labor costs and improving
general safety.
The pinnacle of our safety innovations has birthed a fully automated operational system, known as the Autonomous Haulage System(AHS). This ingenious system has been fully-established in certain major mines in Australia and Chile, which involves the unmanned
operation of giant dump trucks that carry over 300 tons of soil and minerals. The mine is an often harsh environment which requires
constant vigilance and safety protocols, having multiple construction machines and vehicles that operate around the clock on a 24 hourbasis. The AHS system utilizes cutting-edge technologies like satellite communication and various radars and sensors to create a usefulsystem that meets this need in its entirety, responding to the diverse nature of our customer's safety requirements.
Despite these signicant achievements, we are fully aware that there is always room for amelioration. We will continue to innovate andimprove, furthering the evolution of such safety systems in order to realize the optimal safety environment that our customers requirein their respective sites of operation.

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Improving Product Safety and Solutions

Example of Safety Activities

Innovation in Recycling-Oriented Forestry- Contributing to the improvement of safety and productivity in forestry Komatsu regards forestry as an important indurstry that contributes towards the achievement of the SDGs. In forestry, it is important
to contribute to realizing woodland management cycle of planting, cultivating and felling forests, and it is required to operate in a waythat places due consideration on forest environments. Also, forestry poses challenges in terms of ensuring worker safety whileheightening eciency, given the industry’s high rate of occupational accidents. Komatsu is promoting the visualization of the supply
chain through the use of IoT and the provision of products in order to contribute to innovation in cyclical forestry.
In the realm of aorestation, we developed the automated tree planter, which is based on our D61 bulldozer, and rolled it out in theBrazilian market in December 2019. Capable of planting 900 trees per hour, the automated tree planter cuts labor hours byapproximately 70% and makes it possible to mechanize the task of planting trees, otherwise done manually often in hot weather. The
automated tree planter will also most likely contribute to sustainable development of Brazilian forestry, particularly given that it will
streamline future plans for timber felling by making it possible to keep a record of where trees have been planted.
Moreover, in the area of timber felling and transport operations where most forestry-related occupational accidents tend to occur, we
are making progress in developing and selling forestry equipment that enables harvesters to fell and transport timber located on
hillsides without people having to descend to the forest oor. When it comes to equipment for felling and transporting timberwithin woodlands, we have developed an eight-wheel harvester which exerts lower ground pressure, thereby averting the possibility
damaging tree roots.
We have furthermore been working on a smart-forestry concept that makes it possible to visually monitor forestry supply chains. In
Japan, we have been using drones to conduct tree planting and growth management surveys including forestry resource quantity
estimates. This has enabled us to reduce the labor hours needed for surveys for felling from around ve people per hectare per day to
one person per hectare per day. Moreover, by using ICT-equipped harvesters for processing and sorting logs, we have been able toreduce the labor hours needed from about 13 people per hectare per day to about 0.5 people per hectare per day. We are also focusing
our eorts on developing applications that are capable of drawing on accumulated log processing and timber transport data of the
LANDLOG open platform. We will furthermore contribute to streamlining operations in the future by sharing information with
forestry business operators on lumber markets as well as lumber consumers.
Going forward, we hope to help promote cyclical forestry around the world by facilitating further safety and productivity improvements
in forestry.

D61EM-23M0 automated tree planter

901XC eight-wheel ICT-equipped harvester

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Quality and Reliability - Responsible Commitment to Customers -Quality and Reliability - Responsible Commitment toCustomers Komatsu's commitment to quality and reliability is encapsulated within the fundamental principle of “Monozukuri) (manufacturing
competitiveness). With this in mind, we are dedicated to maintaining a portfolio of rst-class products-both hardware andsoftware−that builds on customer satisfaction. Our basic managerial policies have a strong focus on customer-centricity, creating a
manufacturing ecosystem that places customer satisfaction at the forefront of its priorities. We maintain the standards of quality thathave become an integral part of our organizational culture through a continuous process of assessment and re nement that takes
place across all areas of our production process.
Our quality management systems touch on a number of speci c elds, such as the global environment, quality assurance, and theeducation and training of our personnel. We also evaluate our performance in these areas using a number of key performanceindicators.

Our Principles (Komatsu's Principles that govern Quality Assurance)
Komatsu has established the following principles on quality in its products and services, which all subsidiaries and employees are
responsible for putting into practice.

General Approach to Quality and Reliability
We provide customers with products, services, and systems that are considered to be environment friendly, safe, and innovative.

De nition of Quality Assurance
The company has a responsibility to take actions that will ensure it is able to provide products and services that the customer canpurchase and use with a sense of assurance and satisfaction and use for many years to come.

Principles Governing Quality Assurance
1. Putting customers rst, being receptive to the views of the customer, and responding appropriately to the customer, thereby
earning the customer's satisfaction, are fundamental to the job of every employee and constitute the responsibility of every
employee.
2. Complying with international standards and the legal requirements particular to individual countries as a matter of course, andproviding products and services that, from the perspective of the customer, have incorporated proper regard for safety and a senseof assurance and that do not easily malfunction, are fundamental to the job of every employee and constitute the responsibility of
every employee.
3. Providing products and services that incorporate proper regard for global environmental conservation is fundamental to the job of
every employee and constitute the responsibility of every employee.

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Quality and Reliability - Responsible Commitment to Customers -4. Providing products and services that are creative and provide benets to the customer is fundamental to the job of every employee
and constitute the responsibility of every employee.
5. Giving the customer a sense of safety, assurance, satisfaction, and the ability to use the product for many years to come is a sourceof happiness for every employee.

Mechanisms for Quality Assurance
Komatsu employees across all areas of our operations, from product planning to development, manufacturing, sales, and after-sales
service, work together as a single cohesive unit to ensure that the products we develop are safe, innovative, and of high quality. Our
unique “monozukuri- system enables the creation and subsequent introduction of highly competitive DANTOTSU products into themarket, whilst maintaining our signicant competitive advantage through goods and services with a wide array of substantial features.
Keeping in line with our commitment to product quality and innovation, a variety of meetings are held at each stage of thedevelopment and manufacturing process in order to ensure that our oerings are of the highest possible quality. Through thismeticulous step-by-step process, the product's features are enhanced and rened until it meets the high standards that we adhere to.
Through such approaches, the company is able to strengthen safety assurance and satisfaction for customers while simultaneously
providing products and services that take the global environment into account and comply with both international specications andthe regulatory requirements of individual countries.

Structure for Quality Assurance
The majority of Komatsu's product portfolio is made up of manufacturing equipment (construction and mining equipment, presses,
and forklifts) that lend value to customer enterprises through enhanced rates of operation and productivity. In order to ensure optimaluser experience, Komatsu sales agents engage with customers on both a pre-sale and post-sale basis to provide advice, conduct
maintenance, and collect feedback. This collated information is then related back to the relevant Komatsu divisions for evaluation and,
if it should be needed, subsequent follow-ups or remedial actions.
Komatsu also maintains comprehensive databases on market information regarding product quality. Company sales sta are able toutilize this wealth of information to ensure the rapid resolution of quality-related issues, should they be raised.

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Quality and Reliability - Responsible Commitment to Customers -Increasing the Degree of Customer Satisfaction
In accordance with our Principles that Governing Quality Assurance, Komatsu has introduced a range of initiatives that deal explicitlywith increasing customer satisfaction.
We take customer response seriously, and have implemented rigorous feedback mechanisms in order to give due consideration to theviews of our consumers. Utili(ing regular customer satisfaction and post-launch eld surveys, we acquire and collate copious amountsof data. The results from these assessments are used by our analysts to improve upon not only our product quality, but our quality
assurance frameworks as well. The surveys help furnish new value to customers as the company develops DANTOTSU products that
anticipate customer needs in advance and delivers services with distinct features.
Komatsu is able to raise the level of customer satisfaction through the following approaches.

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Quality and Reliability - Responsible Commitment to Customers -Post-launch Field Surveys and Feedback of Results
Komatsu's post-launch eld surveys are a core component of our customer satisfaction assurance framework, conducted by our
employees who visit purchasers of our newly developed products in order to acquire important data regarding product evaluation.
These personnel listen to customer feedback, taking input on all aspects of the product in order to report back to the relevant Komatsu
divisions. After careful assessment of operational feedback and customer requests pertaining to service and replacement parts, we
process the data into quantied objectives for improvement. The data is also disseminated to all levels of the company in order toensure an eective understanding of customer needs and potential areas for advancement. With these systems in place, we are able toconsistently deliver products and services that generate optimal levels of customer satisfaction.

Tracking Vehicles with Extended Hours of Operation*
Keeping in accordance with our commitment for pursuing product durability and reliability, we track our product vehicles that haveseen lengthy periods of operational service. By storing this information, Komatsu is able to predict potential issues with productusability and respond promptly to requests for servicing and other maintenance concerns. In addition to this, we utilize a remotemanagement system named “KOMTRAX PLUS” to monitor equipment operating conditions, allowing us to ensure continued productstability in terms of durability, eciency, and functionality. Through these assessment systems, we are able to analyze customer
expectations and satisfaction in relation to our product quality objectives. Should there be a failure to meet these objectives, Komatsu
designs carefully evaluated proposals to rectify problematic areas, later integrating any eective measures into product revisions ordevelopment. This process increases product durability and reliability and thus extends product lifecycles, leading to greater customer
satisfaction and an overall decrease in resource consumption and waste production.
* Dened as vehicles with an operating history of 5,000 hours or more

Using ICT to Support Customers throughout the Product Life Cycle
Komatsu uses ICT-based remote vehicle management systems in order to track the current status of a vehicle's “health”, its operating
status, and other relevant information metrics. The Komatsu Tracking System (KOMTRAX) is used for conventional construction
equipment, while the Komatsu Tracking System Plus (KOMTRAX Plus) is used in relation with larger mining equipment.

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Quality and Reliability - Responsible Commitment to Customers -Quality Assurance Activities at the Global Level
By fully implementing our quality assurance systems on a global level, Komatsu is able to ensure that its products meet a standardi)ed
level of high quality across all countries of operation. Regardless of geographical location, our products are subject to strict, uniform
standards in relation to technical drawings, manufacturing systems, inspection methods, information collection, and quality
management.
Komatsu has a number of manufacturing facilities that it refers to as “mother plants”. These plants have product development
capabilities and serve as the central hub for global product development initiatives using cutting-edge technologies and techniques.
Any form of progress or advancement that is conceived at a “mother plant” is immediately disseminated to other Komatsu
manufacturing locations around the world, creating a uniform ecosystem that promotes technological development and enhances
product quality.

Standards for Product Safety
Safety and customer trust are at the forefront of all our quality assurance activities. In line with this dedication, Komatsu has
formulated a number of Product Safety Standards and associated principles that all employees are expected to comply with in theexecution of their duties. This enables us to live up to our established reputation by delivering products that exceed customer
expectations in terms of safety, quality, and longevity.

Information System for Product Safety and Services
While we have utmost con dence in the safety of our products, Komatsu is nonetheless aware of the fact that potential issues could
arise in the course of their usage. In order to facilitate a rapid response to any problems that occur, we have established an information
system that deals exclusively with product safety concerns.
The system executes a consistent process of education and re nement, making constant improvements and allowing employees at alllevels to respond quickly to problems without delay. Using the system, personnel are able to (1) assess the cause of the accident andsubsequent procedures to be taken, (2) contact the relevant governing authorities, and (3) decide the best course of action in terms ofremedial measures, such as product recalls.

Standards for Product Safety
1. Compliance
The provision of products and services that comply with international standards and the legal requirements particular to individual
countries is fundamental to the job of every employee and constitutes the responsibility of every employee.
2. Safety via prevention
The provision of products and services that are safe and provide a sense of assurance, and do no harm to the customer isfundamental to the job of every employee and constitutes the responsibility of every employee.
3. Security regarding accidents
The provision of products and services that minimi)e any injury that might occur to a customer who has an accident isfundamental to the job of every employee and constitutes the responsibility of every employee.
4. Transparency
The ongoing provision of advance safety warnings after receiving information from the customer and, in the case of a defect arisingin a product or service, prompt response measures and the provision of information, are fundamental to the job of every employee
and constitute the responsibility of every employee.
5. Improvement of organizational culture
In order to create a corporate culture in which product safety is emphasi)ed, the standardi)ation of the safety management system
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Quality and Reliability - Responsible Commitment to Customers -and safety techniques as well as ongoing eorts to improve them are at all times fundamental to the job of every employee andconstitute the responsibility of every employee.

Providing Product Safety Information to Customers
Komatsu meets legal requirements for the provision of safety information through (1) direct indication of information on products or inuser manuals, (2) direct explanations by pre-sale and post-sale service personnel, and (3) telephone consultations with pre-sale andpost-sale service divisions. In addition to this, we provide further engagement on a case-by-case basis, with engineers or uppermanagement visiting customers when necessary.

System for Dealing with Recalls
We have noticed a paradigm shift in customer concerns in recent years, with a greater focus on product safety and recalls. To meetthese new expectations and ensure product safety in our markets, Komatsu is reinforcing its recall-related organi&ational strength,comprehensive response capabilities, procedures for prompt corrective measures, and proactive information disclosure whilst
conducting increasingly rigorous monitoring activities.

Procedure regarding recalls

1. Proposal for rectication of the situation based on information regarding the defect; decision regarding what measures thecompany will take toward the market
2. File a notice with relevant authorities as provided under the law
3. Inform customers through appropriate channels
4. Take appropriate corrective measures including, for example, repairs, replacements, or refunds
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Quality and Reliability - Responsible Commitment to Customers -System to deal with recalls appropriately

1. Strengthening of information collecting systems on product quality in the market
2. Promotion of technical veri cation of the problem involved in the recall and timely decision making
3. Regular auditing of recall-related operations
Komatsu strictly oversees compliance with legal requirements. Should a defect be found in its products or services, the company
initiates prompt correction measures and moves forward with proactive information disclosure. The graph below indicates the numberof incidents in which recall notices were led. The company will continue to pursue safety to the greatest extent possible in the years to
come.

Number of Incidents with Recall Notices Filed (including utility equipment products sold inJapan)

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Relationship between Business Activities and the Environment

Relationship between Business Activities and theEnvironment
Inputs and outputs in te product life cycle
The Komatsu Group procures various parts and materials and, through the manufacturing process, utili.es the earth's resources,
including raw materials, water, energy, and chemical substances, among others, to provide products to customers. Such businessactivities have the potential to impact the environment at each stage in the process.
The Komatsu Group will continue to provide high value-added products and services while assessing the environmental impacts
resulting from its business activities, formulating medium- and long-term objectives, and introducing measures to reduce suchimpacts.

Environmental Impact Resulting from Business Activities of KomatsuGroup Companies, including Facilities outside Japan (FY2019)
Independent Practitioner's Assurance

Environmental Impact Resulting from Business Activities of Komatsu Group
Companies, including Facilities outside Japan (FY2019)(764KB)

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Relationship between Business Activities and the Environment

Environmental Impact Indicators by Region
Independent Practitioner's Assurance
Scope1 : CO2 emitted directly by manufacturing facilities

Scope2: CO2 emitted indirectly by manufacturing facilities(by using generators, boilers, etc.)(by purchasing electricity, steam and hot water)

EnergyWater Resources

CO2 （Scope1 and Scope2)

Waste

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Climate Change

Climate Change
Mitigating Climate Change through Products and Service
Reducing CO2 Emissions from Construction Equipment

The main bulk of CO2 emissions produced throughout the lifecycle of our construction equipment is centered on product operation,
during which approximately 90% of emissions are produced. We have acknowledged this fact, and are working to reduce these
operational emissions through three dierent initiatives: “Dantotsu Products”, “Dantotsu Service”, and “Dantotsu Solutions”.

Step1: Reduction of CO2 Emissions through Dantotsu Products
We provide products which have been designed to operate withgreat fuel eciency while reducing gross CO2 emissions. Komatsu
pioneered the creation and introduction of the hybrid hydraulicexcavator, marked as the rst of its kind to be introduced into themarket.
These hybrid construction machines have been certied by the
Ministry of Land, Infrastructure, Transport and Tourism of Japanas a “Low Carbon Type Construction Equipment.”
As of April 2020, a total of 16 of our hybrid models have received
such certication, such as the HB215-3, HB205-3, HB335-3, and
HB365-3.
In addition to this, another 19 of our product models (including
the bulldozer D155AX-8, the hydraulic excavator PC300-11, thewheel loader WA470-8) have been certied to meet the Ministry ofLand, Infrastructure, Transport and Tourism's “Construction
Machines Fullling Fuel Economy Standards” signifying these
HB335-3
products as construction equipment with great fuel eciency.

Step2: Reduction of CO2 Emission by Products through Dantotsu Service (KOMTRAX)The Komatsu Tracking System “KOMTRAX” is a system developed by Komatsu that automatically gathers the operational
information/health information of our construction vehicles that operate all over the world, making it possible to thenmonitor/manage/analyze the vehicles remotely. Information with regards to operation times, fuel consumption, and other such
relevant data is communicated to our customers via the internet, which is then analyzed to create opportunities for improvement. Thisenhanced operational eciency helps to reduce fuel consumption, which results in a reduction in overall CO2 emissions.

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Climate Change

Step3: Reduction of CO2 Emissions for Overall Construction Work through Dantotsu Solutions(SMART CONSTRUCTION using ICT Construction Equipment)
In 2013, Komatsu introduced the world’s rst automatic blade control ICT bulldozer, D61PXi-23, to the North American, European, andJapanese markets. Following this, in 2014, Komatsu developed and released a hydraulic excavator with semiautomatic control
functions (PC210LCi-10 for North America and Europe, and PC200i-10 for Japan). Preliminary calculations based on in-house testing
were promising, with construction data for ICT hydraulic excavators showing that fore-slope shaping work using the PC200i-10 resulted
in an approximate reduction of 30% in fuel consumption. In addition, the same testing showed that ICT bulldozers (like the D61DXi-23)
used in land preparation work resulted in an approximate reduction of 25% in fuel consumption. Our testing with hydraulic excavators
also showcased a signicant decrease in CO2 emissions.
To consolidate our eorts in this sector, Komatsu is implementing “SMART Construction”, a system that uses ICT-type construction
machines alongside drones and 3D scanners to take real-time topography measurements. This initiative helps showcase the eciencyof our machines by recording progress in construction sites and other relevant performance indicators.

Reducing CO2 Emissions from Product Operation
Komatsu has set the target of reducing the CO2 emissions from the operation of products (construction, mine, and forestry equipment)by 50% by FY2030 (compared to FY2010).
To evaluate progress toward this goal, we compared the performance of the current year’s products to the products of the reference
year (FY2010) and estimated CO2 reductions through the improvement of fuel consumption and work eciency. The products of FY2019
achieved a CO2 reduction of 14%, compared to the reference year.
Independent Practitioner's Assurance
CO2 emission index for product operations

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Climate Change

Hybrid LHD*1 with reduced CO2 emission by 30% or more
The Joy 18HD and 22HD LHD’s utili8e our energy e cient SR*2electric drive train technology coupled with our innovative KESS
(kinetic energy storage system) energy storage solution to achieve
best in class production, lower fuel consumption, and reduced
emissions. The SR electric drive e ciently provides power to thewheel motors to propel the machine. During braking, the braking
energy, which would otherwise be wasted as heat, is captured andstored in the KESS unit as the system electrically brakes themachine. The braking energy stored in the KESS can now be
directed back into the traction system as needed which directly
removes a portion of the load from the engine, resulting in 30% ormore reduction in fuel consumption and CO2 emissions.
Hybrid LHD*1:LHD；Load Haul Dump
*2:SR ; Switched Reluctance

WA470-10 Wheel Loader with Drastically Improved Fuel E ciency
In February 2020, Komatsu released the WA470-10 wheel loader,which employs the latest technologies throughout and also
drastically improves fuel e ciency. It is equipped with the
Komatsu hydraulic mechanical transmission (KHMT), which
combines a hydro-static transmission (HST) capable of stepless
shift transmission with a high-e ciency mechanical transmission,and uses the newly developed KHMT control system. It
comprehensively evaluates loads on the machine andautomatically controls engine power and the distribution of
power to the running system and machine operating system, etc.
to more appropriately control acceleration, traction, and working WA470-10
force, etc. These controls keep the engine in a low-speed/highe ciency state, resulting in improved fuel consumption.
Furthermore, the workload has also been improved by the newly
reshaped bucket. As a result, fuel consumption (ton/L) has
improved by approx. 30% compared to the conventional machine(WA470-8), as it exhibits superior environmental and economic
performance.
Rated engine output (net)216ｋW

Operating mass

24,830kg

Bucket capacity

3.6-5.2m

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Climate Change

Development of Hydraulic Systems and Devices for Mining Shovel PC3400-11M0-- Drastically Improved Environmental Performance by Redesigning the Hydraulic System -Komatsu has put PC3400-11M0, its new 300 t-class mining hydraulic shovel with an 18 m3 bucket capacity, onto the market. This model
is equipped with our newly developed ultra-large control valve, and controls the hydraulic system electronically. The ultra-large control
valve has a unique internal structure that drastically reduces pressure loss under high ow conditions. In addition, the electronicallycontrolled hydraulic system enables optimal control of the hydraulic devices according to the operating status of the machine, reali5ing
good operability and drastically reduced hydraulic pressure loss. As a result, the machine’s fuel consumption has improved 22%compared to the current machine (PC3000-6), including the 4.7% improvement in fuel consumption from the hydraulic system. In
addition to the new control valve, other main devices including the main pump, swing motor, running motor, and hydraulic cylinder are
all developed and produced by Komatsu. Through Komatsu's traditions of high quality and reliability, we have successfully reduced
machine downtime, leading to improved productivity on mining sites.

PC3400-11M0

Newly developed ultra-large control valve

Release of the Thermoelectric EH Vibration Sensor Device
KELK Ltd. has released a thermoelectric EH vibration sensor
device, including the FFT (fast Fourier transform) analysis
function, a global rst. It is powered by thermoelectric energy
harvesting (thermoelectric EH), which harvests minute thermalenergy from the surrounding environment. The thermoelectric
EH vibration sensor device operates using power it generates
using KELGEN, a high-performance thermoelectric power
generation module, and does not use batteries or an external
power supply. This eliminates the waste of disposed batteries andthe need for external electric power. Wiring work is also
unnecessary. Therefore, it is an energy-saving product that
reduces initial and running costs.
Approximately 50% of equipment failures are caused by rotarydevices. Vibration errors are observed at the initial stages of thedeterioration of rotary devices. Preventive maintenance is made Thermoelectric EH Vibration Sensor Device
possible by detecting errors at an early stage through thecontinuous monitoring of the equipment status to ensure
maintenance is performed at the right time, before a failure
occurs. This is expected to reduce opportunity loss due toequipment failure, repair costs, and the inventory of parts formaintenance.

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Climate Change

Reducing CO2 Emissions in Manufacturing Operations
As a part of our eorts to mitigate climate change, Komatsu aims to proactively reduce the amount of CO2 emissions per unit, using CO2
emissions per unit of manufacturing value as our main indicator for the amount of electricity, gas, oil and other types of energy used inresearch/development at our oces and in manufacturing operations.
In FY2019, we set new mid- and long-term objectives globally and have been promoting improvement activities.
Because of the decrease in production due to decreasing demand for construction/mine machinery, CO2 emissions decreased in both
Japan and overseas in FY2019. The unit per internal manufacturing value also declined drastically from the previous year.
Thanks to energy-saving activities in casting and forging processes, which emit a lot of CO2, new solar power plants, and green
electricity purchases, the CO2 emission intensity per internal manufacturing value was reduced 31.5%, compared to FY2010, which
achieved the FY2019 objective of a 24% reduction.
In addition, the usage rate of renewable energy increased to 10.7%, achieving the FY2019 objective (10% or higher) due to purchases ofgreen electricity mainly in Europe and the U.S.
We aim to reduce CO2 emission intensity in FY2020 and later, focusing on the CO2 emission reduction project for casting and forging
processes.
Item

FY2018FY2019Target of FY2030

CO2 Emissions Basic Unit (compared FY2010)

79.5

68.5

50

The rate of renewable energy use

5.3％

10.7％

50％

Major Achivements in the previous scal year
Japan
Saving energy by renovating component plants
Building additional solar power plants
Overseas
Increased purchasing of green electricity
Saving energy by optimi3ing melting furnace operations

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Climate Change

CO2 emissions, energy indicators in production activities
Independent Practitioner's Assurance
CO2 Emissions

The rate of renewable energy use

CO2 Reduction Activities in Hammering Process (KUI)
PT. Komatsu Undercarriage Indonesia (KUI) produces parts for theunderbodies of construction machinery. They have improved
productivity, utility equipment e ciency, and implemented
various other energy-saving activities. In FY2019, they reduced CO2
emissions per unit of manufacturing by 52%, compared to FY2010.
KUI has also been working as one team to further TPM activities
since FY2013 which has also led to CO2 reductions. For example,
for one compressor that supplies power to seven forging air
hammers, which use the most energy in the plant, KUI began withbasic activities such as eliminating air leaks, followed by a reviewof the air piping system and the introduction of an inverter toenable the air to follow pressure changes since FY2018, achieving Air compressor
a CO2 reduction of approx. 500 tons. In addition, they have also
performed other activities, such as switching the heat source forhammering thermal processing from light oil to city gas, which ismore environmentally friendly. KUI has been conducting CO2
reduction project activities with plants in Japan and China since
FY2019 and has been promoting activities for further reductions,mainly in the hammering process.

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Climate Change

Reduction CO2 Emissions in Logistics

CO2 Emissions Reduction Conditions in Global Transport(Basic Unit of CO2 Emissions per Cargo Weight: kg-CO2/ton)
In 2011, Komatsu began improving our data collection regarding CO2 emissions from logistics operations in our 10 major international
business locations. Including the improvements that were implemented in domestic locations from 2006, we have now implemented
improvements in logistics operations on a globally consolidated basis at all 25 business locations.
Domestically, we have continued to focus on reducing transportation distance by increasing the utilization rate of Kanazawa and
Hitachi Naka Ports (which are located adjacent to manufacturing plants), as well as improving long distance and overlandtransportation through the use of coastal vessels and railways (modal shift).

Global Shipment CO2 Emissions Volume and Basic Unit
In FY2019, we continued to implement the priority items above. However, due to a signi cant reduction in the number of vehicles
exported, the basic unit index (CO2 emissions per cargo weight) worsened, +10% compared to FY2018. The index at overseas bases
improved, +1.1% compared to FY2018. Estimates are included in the India plant data for February and March 2020.
Independent Practitioner's Assurance* A basic unit index is an index relative to the CO2 emissions per cargo weight in a reference year (2006 for Japan, 2011
for Overseas) as 100.

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Climate Change

Improvement of CO2 Emissions from Domestic Transportation
Decrease of trailer transportation distance using new domestic vessels
Komatsu strongly promotes a modal shift. Because the new Tsuruga-Hakata route for RORO vessels was established in April 2019, we
reviewed the transportation route of the products manufactured at Awazu Plant for the northwest Kyushu area and enabled asubstantial driver load reduction and CO2 emissions improvement. Therefore, we switched the routes in western Fukuoka, Saga,
Nagasaki, and northern Kumamoto to the routes via Tsuruga Port (Eastern Fukuoka prefecture and Yamaguchi prefecture will use theroute from Osaka Nanko Port to Shinmoji Port).
Improvement of CO2 emissions: 72.4 t/year (0.35% of CO2 emissions from domestic transportation)

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Climate Change

Amount of CO2 Emissions by Scope 3
Independent Practitioner's Assurance
In addition to CO2 emissions from production / sales / service etc., Komatsu aims to collate data regarding CO2 emissions from ourentire supply chain, and reduce CO2 emissions. For that purpose, Scope 3 CO2 emissions are calculated each year.
Scope1:CO2 directly discharged from Komatsu (e.g. CO2 emissions during fuel combustion)
Scope2:Indirect emissions of CO2 due to energy use in Komatsu (e.g. CO2 emissions produced at power generation
due to use of purchased electricity)

Scope3:Other indirect CO2 emissions(Example) Upstream: CO2 etc. generated during manufacturing of purchased items
Komatsu: Transportation ・CO2 emissions occurring during commuting, business trips etc.
Downstream: CO2 emissions produced when using products, such as construction
machinery
From live data gathered by KOMTRAX, Komatsu has gained perspective on the amount of CO2 emissions (Scope 3 Category 11)
produced by our products manufactured in reported scal year in operation world-wide.
The calculation was performed as follows.

Calculation of Emissions from Customer Use(1) Calculate the following by each model
CO2 emissions over the life of each model= (Production Volume for reported scal year) × (Fuel Consumption; L/kWh) × (Engine Output; kW)× (Engine Life; as product life; h) × (CO2 Conversion Factor)※Data for fuel consumption（L/KWh）was collected using KOMTRAX as a representative model.
(2) Total these values, calculated fo each model in (1) above

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
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Index

Climate Change

For others, including the 14 remaining categories, general CO2 emissions was calculated. The result is shown in the pie chart below.

*1 LCA refers to the environmental impact assessment method for individual products at each stage, from manufacture, transportation, sale, use,
disposal, to reuse*2 Scope 1 refers to direct CO2 emissions by operators (ex: fuel consumption)*3 Scope 2 refers to indirect CO2 emissions by operators (ex: power purchase)*4 Scope 3 refers to CO2 emissions by operators from within our supply chain (ex: emissions of product during operation, emissions from suppliers,transportation, business trips and commuting)* Calculating each category, the amount was calculated domestically and overseas. The amount of category (4): "Upstream Transportation disposal" wastotal of domestic and a part of overseas. In category (3): "Fuel Procurement", a part of data in overseas was estimated. The amount of category (13):"Downstream Leased Assets Operation" was included in category (11).

As evident from the results above, emissions during product use make up approximately 90% of total emissions.
From this, we can see that fuel-ecient products have a signicant eect on reducing CO2 emissions.
Komatsu is committed to developing hybrid construction machinery (improving fuel eciency by 25%) and DANTOTSU products (over
10% improvement in fuel eciency). In addition to this, we are accelerating the development and implementation of our ICT-based
SMART CONSTRUCTION business.
In addition, the results of our assessments regarding LCA * 1 (Life Cycle Assessment) can be found in the pie chart below.
«Reference» Pie Chart of Scoe1, 2, 3

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Challenge to establish Recycling-based Society

Our Challenge to establish Recycling-based Society
Development of our “Reman” Remanufacturing BusinessOur “Reman” business involves the remanufacturing of used engines, transmissions, and other key components of construction andmining equipment into “Remanned” components. After con rming that these remanufactured parts are possessed of the same quality
as newly manufactured components, we inject them back into the market. We currently promote the “Reman business at 11 “Reman”
Centers worldwide.
We have established the Reman-Net, which connects Reman centers with one another, and K-WINS, which shares Reman technologicalinformation, and are actively using them for the global expansion of Reman operations and reuse/recycling. In addition, by using IC
tags and two-dimensional codes, we manage the recycling history of remanned components to control quality and obtain durability
data, and then provide feedback that is important for Komatsu to develop components with optimal lifespans.
Quality and performance that matches new components
Lower cost for "remanned" components
Reduced idle time for construction equipment because of adequate inventory of "remanned" components
Resource conservation and waste reduction through reuse and recycling of components

Changes in Reman Sales (base FY2004 = 100)56

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Challenge to establish Recycling-based Society

Reman Factories and Centers map

Reman Process

E ective Use of Critical Materials in Products
Komatsu is working on the conservation and e ective use of limited resources by reusing critical materials used in products, etc.
An increasing number of diesel engines, which are used in construction machines, are now equipped with exhaust gas processing
devices to reduce the density of NOx (nitrogen oxide) and PM (particulate matter) in exhaust gases. The exhaust gas processing devices
use noble metals as a catalyst to reduce the density of NOx and PM. To e ectively use these resources, Oyama Plant in Japan, forexample, collects the exhaust gas processing devices of construction machines that have been replaced and recycles the noble metals
in them. They are also recycling other critical materials to make them reusable, ensuring their e ective use and aiming to reduce theconsumption of new critical materials.

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Challenge to establish Recycling-based Society

Activities to Eectively Utilize Resources in Production (1. Waste)
Komatsu promotes activities to reduce waste discharged from its production activities while also implementing "zero emission"
activities to recycle and e ectively use the generated waste.
We set a new medium-term global goal in FY2019 and began waste reduction activities mainly at bases with metal-casting processes,
which generate approximately 70% of the entire waste volume. By turning waste into a valuable commodity and improving themethods for management of metal-casting waste sand, the waste generated per unit of production recorded a 12.7% reduction from
FY2010 levels. After 2020, we will promote reduction activities primarily at foundries in Japan and overseas to meet new medium-termtargets.
Item

FY2018Index of waste generated per unit
(Reference year: 2010)

FY201998.3

87.3

Target of FY2030
60

Major achievements in the previous scal year
《Japan》
Reduction of wood chips through packing mode improvements for items procured overseas
Expansion of activities to turn waste plastics, oils, etc. into valuable commodities
Expansion and promotion of waste sorting through the establishment of a recycling center《verseas》
Improvement to the management methods of metal-casting waste sand

Waste indicators in production activities
Independent Practitioner's Assurance
Amount of Generated Waste (Scope of data: Komatsu Ltd. and
the Komatsu Group manufacturing facilities)

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Challenge to establish Recycling-based Society

Achieving 100% recycled waste
The Komatsu America Corporation's (KAC) plant in Peoria, IL, USA manufactures mining equipment and warehouses related service
parts. The team purchases components from suppliers and performs value-added manufacturing, before shipping these equipment orparts to customers all over the world.
During the manufacturing processes, waste is generated and historically it was either sent out for recycling or sent for disposal in alandll. Over the past 10 years, the plant has successfully improved the ratio of recycling from 58.8% in 2010 to 100% in 2019.
Some of the initiatives that helped achieve the goal include:・Raising employee awareness and knowledge about recycling, as
well as training employees to segregate waste streams
・Fostering better inventory management and usage habits toeliminate unnecessary waste generation
・Sending the remaining waste to a waste-to-energy facility

The nal 6%：

Between 2010 and 2016, the Peoria plant was able to achieve 94% recycling of all waste streams. The remaining 6% was still being sent
to a landll.
Beginning in January 2016, the team found a solution for the remaining 6% by sending it to a waste-to-energy processing facility. Now
the nal 6% of Peoria’s waste is used in a fuel blend to create steam, which is converted into electricity and transmitted to the local
electric power grid.
It was a full team eort and took time. The entire Peoria team is very proud of nding ways to reduce our environmental footprint andcontribute to society’s sustainable future in even more ways.

Activities to E ectively Utilize Resources in Production (2. Water
Resources)
In FY2019, we set new global mid-term targets for water usage in our domestic and overseas manufacturing facilities and launchedinitiatives to reduce water consumption.
We have managed to reduce water use per unit of internal manufacturing by 49.4% compared to FY2010 by reducing waste through there-use of water within processes and daily management with a focus on sites in the Hokuriku area that use a lot of groundwater.
We will promote further water usage reduction activities domestically and overseas to meet a new medium-term target after 2020.
Item

FY2018Index of water input volume per unit
(Reference year: 2010)

51.6

59

FY201950.6

Target of FY2030
40

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Challenge to establish Recycling-based Society

Major achievements in the previous scal year
《Japan》
Reduction of water leakage by renovating aged aboveground and underground water piping
Reali ation of cooling water circulation in a small-si ed test bench《Overseas》
Use of recycled water for sand processing and cooling towers
Over ow control of underground tanks

Water Use Indicators in Production Activities
Independent Practitioner's Assurance
Water Input Volume (Data coverage: Komatsu Ltd. and the Komatsu Group manufacturing facilities)

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Challenge to establish Recycling-based Society

Reduction of Test-Bench Water Consumption and Environmental Burdens From Engine
Cooling Water Circulation
After the assembly of an engine, we perform an operational test on the test bench to
check its performance. In the test, we add a rust-proong oil to the engine cooling water.
When the testing of one device was complete, the cooling water was discharged from thedevice and processed with chemicals and microorganisms at a nal purication
treatment facility, and then discharged out of the plant.
Now, to reduce water consumption and the volume of discharged water to be processed,
we worked on cooling water circulation in the engine test bench and achieved asignicant reduction of water consumption. We have installed a diaphragm-type pumpcollection device that does not aect the performance of the parts in the engine and altering device to enable the reuse of water. As a result, we achieved the reuse of 75% of
the cooling water, resulting in a signicant reduction of water consumption and thevolume of processed, discharged water. In addition, this also eliminated reprocessing at
the nal purication treatment facility, which has also reduced electric power andchemical consumption drastically.
Filtering device for cooling water

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Theme 2 : Developing People

063

Personnel Policy and Performance Appraisal System

069

Diversity Initiatives

075

Enhancing Work-Life Balance080

Employee Training Structure082

Enhancing the KOMATSU Way

085

Strengthening Our "Gemba" Capability

088

Brand Management Initiatives

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Personnel Policy and Performance Appraisal System

Personnel Policy and Performance Appraisal System
Here at Komatsu, we consider many aspects of our business to be valuable assets. Goods, money, information, and time are all
irreplaceable facets of our day-to-day operations. However, the one resource that stands above all others in terms of value would be
our employees. We are proud to maintain a culture that places our people at the forefront of our priorities, recogni(ing the importanceof their roles in maintaining the quality of our products and the reputation of our company. Komatsu is thus dedicated to thedevelopment of our workforce, striving to foster an engaging work environment that provides opportunities for creativity andchallenges to stimulate growth, all the while building on a relationship of mutual trust with our employees.

Global Personnel Policy
Komatsu is acutely aware of the dierences pertaining to history and culture for each of the regions within which it operates. We arethus engaged in the creation of a personnel management system that tailors to the unique needs and circumstances of each region,whilst maintaining compliance with a set of basic policies as outlined below:
a. We shall respect each employee's human rights, personality, individuality and legally-protected privacy;b. We shall respect diversity and treat and appraise each and every employee in a fair and impartial manner. We shall notdiscriminate against any employee on the basis of race, ethnicity, color, sex, sexual orientation, gender identity, age,religion, national ancestry, disability, marital status or other legally protected status. We shall vigorously promote equal
opportunities for employment;c. We shall give due consideration to work-life balance and physical/mental health, and endeavor to provide the employeeswith workplaces where they can eectively accomplish their tasks with satisfaction and pride. We will not tolerate any
kind of harassment, including sexual harassment, violence or other abusive conduct, in or outside the workplace;d. In designing and implementing Komatsu policies on employment conditions (such as wages, fringe benets, performanceappraisal, promotions), we shall assure that such policies are, and are understood to be, fairly and clearly implemented.
Such policies shall be accurately communicated to employees and, to the extent practicable, made open and accessible;
e. We shall comply with all applicable laws and regulations governing employees' rights and faithfully accommodate,whenever applicable, conversations or discussions with employees or their representatives;f. We shall not tolerate child labor or forced labor; andg. We shall oer terms and conditions of employment that are suciently competitive in their respective regions.
"Any action violating human rights (power harassment, sexual harassment or other harassment related to pregnancy, childbirth,parenting or nursing care)" is specied as grounds for disciplinary action.

Personnel System that Accurately Recognizes Employee Abilities andAchievements
Komatsu recogni(es the importance of providing an engaging workplace environment that recogni(es and accurately rewards theachievements of its employees. This allows our people to take pride in the work that they do, motivating them to strive for greater
heights within and without the workplace. To that end, we have incorporated an advanced system of evaluation that disregards age,gender, or nationality while assessing individual performance and abilities in order to provide a framework for fair recompense.
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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Personnel Policy and Performance Appraisal System

Fair and Appropriate Evaluation
The most important aspect in the creation of a workplace that promotes wellbeing and eective working is the fair treatment of
employees. As mentioned above, Komatsu's personnel management system accurately evaluates our employees, granting recompense
based solely on merit. This system of assessment is enforced through multiple channels, such as evaluation training for bothmanagement and lower-level employees. An evaluation committee has also been established that works closely with labor unions inorder to conrm that evaluations are fair and appropriately conducted. Finally, Komatsu provides individual feedback on evaluations toemployees at both management and non-management positions, and has set up a consultation oce through which employees can
express complaints and concerns.

Condition of Labor Unions
Having signed the United Nations Global Compact, Komatsu recognizes that freedom of association and the right to collective
bargaining are intrinsic human rights that must be respected. Our engagements with labor unions thus reect this commitment,
showcasing our dedication to ensuring the best for our people. We have a labor contract with the Komatsu Labor Union, which isorganized by approximately 10,900 of our employees across 8 of our Japanese branches. The Union employs a union-shop system, andthe percentage of employees who are union members (number of unionized employees / total number of employees including
management and other non-unionized employees) is 79.9%.
The Komatsu Labor Union is a member of its superior body, the All Komatsu Workers Union and a superior industry labor union, theJapanese Association of Metal, Machinery, and Manufacturing Workers. 13 of our consolidated subsidiaries and aliates in Japan havelabor contracts with a labor union that has joined the "All Komatsu Workers Union", making up a total of approximately 6,600
employees.
In addition to this, Komatsu continues to comply with legislation related to labor rights, while responding in an honest and transparent
manner to all dialogues and discussions with individual employees and their representatives.

Creating a vibrant workplace with rewarding jobs
The Komatsu Group regularly conducts an employee awareness survey, seeking to understand how its employees feel about and what
they expect for their jobs, workplaces and company management in order to create vitalized workplaces. The Group aims to oer
workplaces that enable its employees to work more actively by identifying advantages and challenges surrounding Komatsu, which will
be considered when implementing human resource initiatives and employee training programs.

Overview of employee awareness survey in FY2019
Number of
respondents

Employees of Komatsu and its Group companies in Japan, 97.1% responded

Objectives

To understand how the Komatsu Group employees feel about their jobs, workplaces, and supervisors;
analyzing current issues in order to consider measures to implement in the future

Survey overview

94 questions on items including the degree of employee satisfaction with job, oce environment andpersonnel management system, along with employee awareness of the KOMATSU Way

Methodology

As a general rule, anonymous web survey used (paper-based survey for eld workers)

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Contents

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Personnel Policy and Performance Appraisal System

DATA* Above data are on the non-consolidated basis except item (2).
Numbers of employees for item (11) are as of April 1 and all other numbers shown are as of the end of the year, except as otherwise noted.

（1）Number of employees (Non-consolidated basis)
FY2017FY2018FY2019

Total

10,465

11,537

11,692

Male

9,264

10,175

10,305

Female

1,201

1,362

1,387

（2）Number of employees (Consolidated basis)
FY2017FY2018FY2019Consolidated

59,632

61,90862,823

Non-Japanese(consolidated)

40,39742,34942,948（3）Average age
FY2017FY2018FY2019

Total

39.3

39.6

39.5

Male

39.3

39.7

39.6

Female

38.9

39.3

39.3

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PeopleTheme 1 :Enhancing
Quality of Life

Data

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Index

Personnel Policy and Performance Appraisal System（4）Years of continuous employment
FY2017FY2018FY2019

Total

14.1

14.3

15.1

Male

14.4

14.7

15.4

Female

11.8

11.9

12.8

（5）Annual total remuneration (average)
FY2017Total

FY2018
7,387,475

FY20197,608,424

7,467,775*Minimum wages set by age（6）Number of employees by age
Total

Male

FemaleUnder 30

2,319

1,929

390

30-39

3,750

3,482

268

40-49

3,113

2,724

389

50-59

2,510

2,170

340

Total

11,692

10,305

1,387

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PeopleTheme 1 :Enhancing
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Data

Index

Personnel Policy and Performance Appraisal System（7）New graduates employment
College graduate
Year(April)Junior college graduate

Total

Male

Female

Total

Male

2018

187

163

24

26

17

2019

195

169

26

25

2020

226

199

27

27

High-school graduate

Female

Total

Male

Female

9

96

68

28

22

3

132

99

33

18

9

114

86

28

（8）Mid-career employment
College
male

Total

Collegefemale

Other
male

Other
femaleApril 2017March 2018

44

25

12

4

3

April 2018March 2019

140

55

15

59

11

April 2019March 2020

200

74

16

97

13

（9）Employee turnover (April 2019-March 2020)
Total
Number of employee
turnoverMale
129

Female104

67

25

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Personnel Policy and Performance Appraisal System（10）Retention of new employees
MaleFemaleNew employees (April 2017)

194

62

Enrollment (April 2020)

184

58

Turnover rate: 5.5%; 10 males, 4 females（11）Diversity of management
Male

FemaleFemale arcentage

Foreign employees

Management position

1,600

135

7.8%

14

General managers

366

10

2.7%

0

Directors and o cers

47

3

6.0%

6

Executive o cers

43

2

4.4%

6

Managers, directors
and o cers

1,647

138

7.7%

20

68

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Diversity Initiatives

Diversity Initiatives
Komatsu recognizes diversity as a signicant corporate asset, and respects the basic human rights of every employee while striving tooer career development opportunities that enable each individual to fully demonstrate their abilities with a sense of fulllment and
pride. We also make eorts to incorporate the integration of both individuality and diversity into the sustainable growth of the entire
company.
Komatsu's Approach to Diversity* Respect for personality diversity
We shall respect diversity and treat and appraise each and every employee in a fair and impartial manner. We shall not discriminate against any
employee on the basis of nationality, race, ethnicity, color, sex, sexual orientation, gender identity, age, religion, national ancestry, disability, marital
status or other legally protected statuses. We shall vigorously promote equal opportunities for employment; (From "KOMATSU'S WORLDWIDE CODE OF
BUSINESS CONDUCT")

Strengthening the Development of Global Talent
Approach and Goals

Behind the advancement of its global management, Komatsu set strengthening the development of global talent as a key initiative in
the Mid-Term Management Plan. Aiming to realize an environment where diverse talents can work as one team to contribute to growthof our business globally, we are proactively promoting the localization of management, the establishment of a foundation for global
human resource management, and exchange with global talent and also working to employ experts in growing elds.
Along with the globalization of business expansion, approximately 70% of our employees are of nationalities other than Japanese. We
are currently working on the localization of management, and the top management of major local companies are already local
employees. In the future, aiming to foster cultivation of the next-generation of top management who will be responsible for global
management, we will strengthen the systems and measures necessary for the establishment of global career paths.

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Diversity Initiatives

Systems and Status in FY2019
Human Resource Development

Komatsu is currently providing the following two types of training, aiming to nurture both local employees in executive positions at ouroverseas subsidiaries and those in Japan to become candidates for top management.
1. Global Management Seminar Komatsu has started providing Global Management Seminars mainly consisting of lectures anddiscussions on Komatsu’s management policy, the KOMATSU Way, and business strategies to local employees in
executive positions at our overseas subsidiaries since 2006. In 2019, the Global Management Seminar was held in December, with a
total of 14 local employees in executive positions from our overseas subsidiaries in 9 countries (the U.S., Chile, Germany, Sweden,
Russia, China, Indonesia, Australia and South Africa). Through this training, the participants deepen their understanding of the
KOMATSU Way and global management strategies, and they are expected to become top management who implement
operations rooted in the KOMATSU Way.
2. Global Management Training
Komatsu provides Global Management Training with the objectives of nurturing candidates for senior management positions whoplay an active role globally. This training is not only for Japanese top managers, but also for those in our overseas subsidiaries, andwe send them to business schools overseas for short-term training. In 2019, a total of 10 individuals received training in businessschools in the U.S., France and Switzerland.

Management System

In order to eectively promote global management, Komatsu runs various global meetings, including the Komatsu Global Executive
Meeting convened for the top management of all Komatsu Group companies in Japan and overseas, management committees for eachregion and business area, and other global meetings for specic purposes, such as the Quality Meeting, Occupational Safety Meeting,
Health Meeting, Legal Meeting and Human Resources Meeting.
Since the senior management of our main overseas subsidiaries were assigned to the Global Ocer System established in 2016, theyplay a signicant role not only as the senior management in each region, but also as executive ocers in the Komatsu Group throughinvolvement in these important meetings.

DATA
FY2018
Number of xecutive
O cersNumber of lobal
O cers

FY2019FY2020

Total

50

50

49

National top
managers out of total
executive ocers

5

5

6

Total

29

26

29

National top
managers out of total
executive ocers

18

18

19

70

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Diversity Initiatives

Promoting Women's Careers
Approach and Goals

Komatsu is promoting various measures including stimulating employment and developing the capabilities of female employees, andthe development of favorable environments for continuous career development after maternity leave. Speaking only of Komatsu on
the non-consolidated basis, a female executive ocer was assigned for the rst time in April 2011 and a female director was appointed
for the rst time in June 2018. However, we are aware that the relatively small number of female managers, compared with malemanagers, is an issue that we particularly need to improve and we should actively promote female employees to more responsible
positions of higher authority, including promotion to managers, and not just supporting work-life balancing events such as giving birth,childcare and nursing care with work. Komatsu has established the target of raising the rate of female managers to 10％ by April 2021
on the non-consolidated basis, and each of the group companies in Japan and overseas set its own target on the rate of female
employees and managers, taking a variety of measures to achieving this target.

System and Status in FY2019
We have held a Diversity & Inclusion Development Seminar for female mangers ofKomatsu and its overseas subsidiaries since FY2018. In this seminar, those thatparticipated deepened their understanding of the history of Komatsu, the KOMATSU Way
and management strategies, and we supported their eorts to be leaders promoting
diversity initiatives in their companies.
Also in Japan, as a measure to nurture female employees, we have held a career plan
training in which participants think about their future and their work styles. The CDP(Career Development Program6, in which female employees formulate their mid to longterm career plans discussing with their supervisors has also been implemented since2015. Starting from 2016 onward, networking/training workshops for female employees
have been held jointly with other companies in the same manufacturing industry.
Furthermore, we have provided female managers with external training regularly since
FY2015 for the cultivation of senior management.
We believe that measures to promote the active participation of female employees willlead to the development of a system and the creation of an environment in which every
employee can work comfortably and reali3e their full potential, so we continue promoting
these measures across the Komatsu Group.
Scene of DIDS training

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Diversity Initiatives

DATA
FY2018FY2019FY2020

Number (ratio) of women
employed

1,321 (12.2%)

1,463 (12.3%)

1,482 (12.3%)

Number (ratio) of women
junior managers

169 (11.7％)

172 (11.4％)

178 (11.4％)

Number (ratio) of women in
management positions

109 (6.2％)

129 (7.0%)

138 (7.7%)

Number (ratio) of women in
executive positions

2 (4.3％)2 (4.2%)2 (4.4%)

Number (ratio) of women
hired

24 (12.8％)

26 (13.3%)

27 (11.9%)* Data for Komatsu Ltd. (non-consolidated). The numbers and rates are for newly hired university graduates. Data as of April 1.

Support for balancing childcare, nursing care and medical treatment
with work
Flexible work styles are spreading, where employees who are involved in childcare or
nursing care can telecommute or take advantage of a short-time work system. As part ofits eorts to support the balancing of childcare and work, the KOMATSU Way Global
Institute, in-house training center in Komatsu, Ishikawa Prefecture, provides a day-care
center service and since 2016, we have been hosting a networking event on the 19th every
month cooperating with labor unions as a place for communication among employees
who are involved in childcare. In addition, at the headquarters, we invited employees’
Nursing care seminarchildren for a Work Site Tour which provided work-experience opportunities.
With respect to nursing care, we hold seminars conducted by experts, providing
opportunities for employees to develop their mental attitudes toward nursing care andthink about balancing it with work. Since 2018, we have held monthly consultations foreach employee with an expert from outside the company, providing support in line withthe situation of each employee.
Moreover, from the standpoint of health and safety, a consultation service has been
established at each oce so employees can seek advice on the balancing of medical
treatment and work. In 2019, a fertility treatment leave system was introduced, which has
increased options for employees nding a balance between social life and fertility
treatment, and developing a work environment where employees who require medicalcare can work with safety and security.

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Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Diversity Initiatives

Employing Persons with Disabilities
Approach and Goals

Komatsu actively seeks to employ persons with disabilities across the Group. Our goal is to achieve the employment ratio of 2.5% on aconsolidated basis by 2021 for the Group in Japan (the current statutory employment ratio is 2.2%).
In March 2008, Komatsu established the Business Creation Center (BCC) within the Human Resources Department in Japan as a
dedicated organi7ational entity for promoting the hiring of persons with disabilities. Persons with mental or developmental disabilities
are employed by the BCC in eleven business units in Japan. Advisors are assigned to each business unit to provide training and advice
on daily tasks. Each BCC sta member meets with an advisor every six months to discuss goals, instead of simply handling a delimited
set of tasks. Linking salary to individual performance assessments, we encourage employees with disabilities to work on their goals
toward achieving independence and self-reliance. Through these eorts Komatsu is not merely focused on achieving a targeted
employment ratio. Rather, it is seeking to create a workplace that provides a sense of fulllment for all individuals, where employeeswith disabilities work alongside other sta members.

Status in FY2020
As of April 2020, the employment ratio of persons with disabilities is 2.79% (non-consolidated basis). With regards to BCC, there are
144 people working at 11 business units. With the expansion of its organi7ation, BCC has taken on matters that had previously been
outsourced, as well as tasks that had been taking up time and eort internally, thereby contributing to eciency and cost cutting forthe company as a whole.

DATA
FY2018FY2019FY2020

Employment ratio of persons
with disabilities

2.50％

2.55％

2.79%

Number of BCC locations

10

11

11

Number of BCC stamembers

101

125

144

* Data for Komatsu Ltd. (non-consolidated). As of April 1st.

Promoting Hiring of Retired Employees
Approach and Goals

As the aging of Japanese society accelerates, Komatsu is committed to maintaining its eorts to hire more elderly workers.
Komatsu(non-consolidated) introduced a re-employment program in 2006 and revised this system from April 2013 so that as a generalrule all those who desire to do so can work until the age of 65. We also established a Second Career Support Program for employees
who desire to play an active part outside the group, and provide training opportunities, paid leave and monetary aid.

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Diversity Initiatives

DATA
FY2017FY2018FY2019Number of retired employees

184

185

206

Number of retired employees who were rehiredby Group companies

146

155

167

LGBT Compatibility
Concept and system

In "KOMATSU'S WORLDWIDE CODE OF BUSINESS CONDUCT" October 2017 revision, we stipulated the prohibition of unfair
discrimination against sexual minorities (not only nationality, race, religion, age, sex, presence or absence of disability, but also sexual
orientation and gender identity) as sexual harassment including discriminatory remarks subject to disciplinary action. In addition to
implementing a number of initiatives, such as setting up an in-house counseling desk for LGBT individuals, the certi cation of same-sex
partnership and expansion of scope of welfare bene ts, we also worked to promote understanding of LGBT to all employees through anumber of approaches like e-learning.

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Enhancing Work-Life Balance

Enhancing Work-Life Balance
Past Endeavors and Status in FY2019
The maintenance of a healthy work-life balance is an integral component in bringing the best out of our employees. Studies haveshown that individuals who are able to nurture a fullling personal life alongside their work commitments are both more motivatedand driven, while being able to draw out the full potential of their abilities. With this understanding in mind, Komatsu is working to
reduce the total number of required working hours for our personnel by setting up a number of work-life balance systems to improve
workplace sustainability.
We are currently engaged in co-operative undertakings with labor unions in order to formulate specic quantiable targets to reduce
the total number of working hours for our employees. We establish commendable goals of less than 2,100 working hours per year,
along with the provision of an average of at least 18 days of paid leave per year for each employee. In addition, based on compliancewith the Article 36 Agreement or agreement on overtime, we are working to reali7e an ecient way of working. In FY2018, we began aninterval system that enforces a minimum of 10 hours of rest following long periods of work in order to promote safe and healthy
workstyles.
In addition, we consider the arrangement of systems for child-care leave and short working hours to be a requisite in creating asustainable work environment. Our eorts to promote work-life balance in the workplace have not gone unnoticed, and in 2007, wewere certied by the Japan Ministry of Health, Labour, and Welfare with the "Kurumin" symbol. This prestigious accolade marks us as acompany that supports the development of the next generation, and has encouraged us to bolster our already signicantcommitments.
In addition to child-care leave and the reduction of working hours, we launched the "anel on Fostering Future Generations", as well as
the "esearch Group on Solutions against Low Birthrate and Longevity". We have also continued to work on improving the reach andextent of our child-care support systems by extending periods of child-care leave (to a maximum of three years) in 2011. In 2018, we
further expanded the system by establishing a leave system that caters to spousal relocation.
Our personnel evaluation systems continue to be improved upon, and we now oer options such as temporary part-time work for
employees raising children and personal goal-setting in accordance to employee working conditions. In doing so, we provide realistic
motivation for employees, ensuring the continuance of their careers alongside the raising of their children.
Komatsu is also committed to providing aid to employees who are providing nursing care for their family members. In 2013, we
introduced an allowance for employees on family-care leave as a means of nancial support, and in 2014, we rolled out a hometeleworking option for employees who are required to stay home in order to take care of children/other family members. With thesesystems and initiatives, we will further enforce our initiatives to balance work with home life of each employee.

DATA* Information on this page is non-consolidated with the exception of certain programs, which encompass not only Komatsu Ltd. but also our subsidiaries
in Japan.

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Enhancing Work-Life Balance

Main Programs and Measures Designed to Enhance Work-Life Balance
Programs and easures

Child-care support

Content

Child-care leave
programAvailable for a maximum of three years from the birth of the child to the time
the child enters nursery school. Also available for a maximum of three years
for children up to the third grade of elementary school in cases where a
spouse is transferred, etc.

Part-time work

Shortening of working hours by a maximum of three hours per day to allow
for care of children up to the third grade of elementary school

Telework program

Option to work at home in order to care for children up to the third grade ofelementary school

Allowance toward thecost of using childcare services

Allowance toward the cost of childcare for infants up to age two before
entering nursery school (10,000 yen/month)Child-care leave

Five days for nursing care of one child up to the third grade of elementary
school, and ten days for the second child onward (paid leave)
Allowance granted to cover the cost of using child-care services

Family-care leave
program

A maximum of three years available for employees taking care of family
members (possible to take in installments)

Part-time work

Shortening of working hours by a maximum of three hours per day (possible
to take in installments)

Telework program

Option to work at home for a maximum of three years in order to provide
care for family members

Family-care leave

Five days per year for attending to one family member in need of nursing
care, and ten days for the second family member onward (paid leave)

Life support leave

Can be used as sick leave, pregnancy leave, child-care leave or for care offamily members. An employee may add ve new days of accumulated leave
per year. A maximum of 40 days of unused annual leave may be
accumulated. Child-care leave may be used for school events for children
aged up to third grade in junior high school

Flexible leave forrefreshment

Provided to encourage employees to take ve consecutive days of leave formental and physical refreshment
Employees receive an additional ve days of annual leave and a travel
voucher upon completion of their 15th, 25th and 35th year of continued
serviceVolunteer incentive
programLong-term paid leave of up to two years, or short-term paid leave of 12 days
per year

Family-care support

Other types of leae76

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Enhancing Work-Life Balance

Programs and easures
Spousal transfer
occupational leavesystemContent
Acquisition for up to three years per spousal transfer (Acquisition up to one
per employee)

Flexible Working Style
Flexible working hours (core time; 11:00 am-2:45 pm)
Part-time work (child and other family-care)Half-day paid leave
Maximum of ve consecutive days of paid leave for refreshment
System and facility for supporting child-care (nursery payment and use of in-house nursery)
Discretionary work system (employees in development, design and R&D section)
Telework program

Various Incentive Programs
Subsidi.ing the expense of taking a certication course
Job posting system
Studying in domestic college or study abroad program
Employee awards program for distinguished achievement
In-house language school and subsidi.ing the expense
Stock option (directors, ocers and some executives)

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Enhancing Work-Life Balance

Work-Life Balance Data
Parental leave

FY2017FY2018FY2019Pregnancy leaves

59

63

59

Child-care leaves (total)

120

137

161

Child-care leaves(paternal leave)

15

23

43

Child-care leaves(within one week leave)

0

1

3

97.5％

98.6％

99.4%

Return and retention rates

Family-care leave
FY2017
Family-care leaves

FY20184FY20197

5

Paid vacation
FY2017FY2018FY2019Days granted

20.0

20.0

20.0

Days taken

19.4

19.5

19.9

Ratio

96.8%

97.5%

99.3％

Volunteer Time O (VTO)FY2017Numer of VTO users

FY201871

FY201992

78

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Enhancing Work-Life Balance

FY2017
VTO in long-term

FY20180

FY2019079

0

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Employee Training Structure

Employee Training Structure
Approach and Goals
Komatsu strives for the sustainable growth of both the company and employees through human resource development. We believethat each employee is responsible for the setting of high individual goals, and the subsequent ful llment of these goals. Each employee
should thus be self-reliant and highly motivated in seeking the knowledge and skills necessary for the ful llment of personal
objectives, while relying on company support through our educational programs. Komatsu supports the career development of each
employee focusing on the education required to company management and employees.
While we promote the education of professionals in a wide variety of pro ciencies, Komatsu is aware of the importance for the
dissemination of knowledge and skills at every level within the company. Regular explanatory sessions and discussions are convened
at Group companies to propagate the KOMATSU way, ensuring that it is incorporated as an integral component of our human resource
development on a group-wide scale.

System and Status in FY2019

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Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Employee Training Structure

A Case of Employee Training: Manager Refreshment Training
Since 2017, Komatsu has been conducting a specic training program for manager-level personnel, activating a 360 degree
feedback system which requires evaluations from each participant's supervisors, colleagues and other team members. Through thesystem, we aim to promote improvement of communication at the workplace, encouraging all the participants in the training torecogni9e the gaps in perceptions with others.
All manager-level personnel in Japan are eligible to attend the program. A total of 2,825 managers attended the training program so far
with an attendance rate of over 80%.
The program contributes to preventing abuse of authority and sexual harassment at work from happening by having senior employees
reali9e that they are apt to have an inter-generational perception gap with employees, especially the younger generations. Managers
who attended the program commented like, “It was a good chance for me to reali9e how I am perceived by others,” “The program
helped me to understand the gap in generational thinking,” and “The program provided a heads-up, and it helped us to address theissues that we face in the oce.” We aim to achieve a 100% attendance rate for the program as soon as possible.
FY2017FY20181,185

FY2019
656

Total
2,825
(Attendance rate:86%)

985

Please refer to the following websites for the contents of programs that were held in 2019
Educational training pertaining to
the KOMATSU Way

Technical Capability of the
manufacturing workplace

Service Personnel HR
development

DATA

Employee Training
FY2017FY2018FY2019Average hours per FTE

58

58

53

Average spent per FTE

JPY255,000

JPY245,000

JPY244,000* Non-consolidated data for Komatsu Ltd.

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Enhancing the KOMATSU Way

Enhancing the KOMATSU Way
Approach of The KOMATSU Way
The KOMATSU Way is a statement of values and standards that all workers at every level of the Komatsu Group are expected to meetand uphold. The KOMATSU Way is a written statement of our corporate strengths, beliefs that support those strengths, the basic
attitude of mind and perspective, and a manner of action (style), which our predecessors created based on the founder’s spirit,
throughout the history of our growth and development. We aim to spread this knowledge to all employees and maintain it into the
future.

System and Status in FY2019
The KOMATSU Way nds its roots in the corporate strengths that Komatsu has cultivated over time, culminating in a system of integrity
and strength that is disseminated to group companies on a global scale. This propagation is achieved through the KOMATSU Way
Global Institute, which conducts various publication and human resource development activities.
Employee understanding of the KOMATSU Way is deepened via training sessions and the creation of opportunities for exposition andgroup debates. We foster interpersonal communication between employees at such sessions to minimize generational gaps, allowing
for a more eective "trickle-down" spread of this knowledge. We have also considered the intrinsic dierences of foreign cultures, andhave worked to craft the KOMATSU Way in a manner that is both easy to understand and relevant for the international community atlarge. This allows us to promote the KOMATSU Way in domestic and foreign settings, allowing for uniformity across the group.
In FY2019, we released the third English and Chinese versions of the KOMATSU Way. The translation of the KOMATSU way has been doneby each overseas subsidiary to ensure that they are able to understand it in their native language. Translation into other languages isplanned to be completed by the end of FY2020.
In FY2019, we also held TQM (Total Quality Management) training for the rst time for Komatsu Mining Corp. (KMC), which joined theKomatsu group in FY2017. Training in the KOMATSU Way is positioned as an opportunity for the cultural fusion of Komatsu, which has along history, and the former Joy Global Inc., through the deepening of the understanding of the history of Komatsu and the KOMATSU
Way. Training was held at three bases in North America. It was also held in China (Beijing and Changzhou), Europe (U.K. and Italy), andAustralia. We will continue human resource development activities for ever-increasing overseas employees and the global penetrationof the KOMATSU Way and TQM in a planned way.
We believe that through these activities, we will be able to foster employees who practice the KOMATSU Way and pass it on to the next
generation, leading to the sustainable growth of the entire Komatsu Group.

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Enhancing the KOMATSU Way

DATA

Educational Training that pertains to KOMATSU WayName of Training
CourseCourse participants

Targets

Training ates

Education for top
management
personnel ofoverseas subsidiaries(Global Management
Seminar)Overseas subsidiaries'
management level
personnel orcandidates

To train managers at
our overseas
subsidiaries who
have comprehensive
understanding of the
KOMATSU Way

December 2019 (Japan)

14 people

To train up local
leaders who
understand andpractice the
KOMATSU Way

June 2019 (North
America)
August2019 (Changzhou,
China)
September 2019
(Bei*ing, China)
October 2019 (UK)
October 2019 (Italy)
November 2019
(Australia)

88 people (North
America)
16 people (Changzhou,
China)
29 people (Bei*ing,
China)
18 people (UK)26 people (Italy)
36 people (Australia)

Mid-level managers ofoverseas subsidiaries
with aptitude

To train up'evangelists'
responsible for
spreading the
KOMATSU Way in ouroverseas subsidiaries

June 2019 (North
America)
August2019 (Changzhou,
China)
September 2019
(Bei*ing, China)
November 2019
(Australia)

20 people (North
America)
16 people (Changzhou,
China)
16 people (Bei*ing,
China)
18 people (Australia)

TQM instructor
training

Mid-level managers ofoverseas subsidiaries
with aptitude

To promote
understanding of QC
at overseas
subsidiaries

June 2019 (North
America)
October 2019 (UK)
October 2019 (Italy)
November 2019
(Australia)

54 people (North
America)
23 people (UK)23 people (Italy)
16 people (Australia)

Training by Job Level

New employees,
assistant managers,
newly appointed
managers, etc.

To promote theunderstanding andpractice of the
KOMATSU Way

Year round

1,511 people

Education for midlevel managers ofoverseas subsidiaries(KOMATSU Way
Leadership
Development
Program)

KOMATSU Way Expert
Development
ProgramMid-level managers ofoverseas subsidiaries
expected to be
responsible for thecore
business/functions

83

Number ofparticipants/cases

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Enhancing the KOMATSU WayName of Training
CourseAll Komatsu QC
Convention

Course participants

Targets

Training ates

Number ofparticipants/cases

Selected from theKomatsu Group in
Japan and overseas

To present
improvement
activities as OJT andstrengthenawareness of the
KOMATSU Way
practices

November2019 (Osaka Plant)

About 950 people

The KOMATSU Way-History of Dissemination Activities

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Strengthening Our "Gemba" Capability

Strengthening Our "Gemba" Capability
Komatsu employees are our most valuable assets because they support sustainable corporate growth.
Developing every employees all over the world through a variety of our human resource development programs enhances Gemba
capability (employee-driven continuous improvement capability).

Enhancing the Technical Capabilities of Our Manufacturing Operations
Systems and Status in FY2019

With major advancements in technologies and globali2ation within our production operations, the need for a high level of technicalcapability has become all the more relevant. As such, we have designated the third Saturday of every October as "Technical Day",
holding technical competitions for employees from all areas of Komatsu. These include personnel from overseas subsidiaries andbusiness associates, who come together to maintain and improve the overall technical capabilities of the Komatsu Group throughmutual dedication to studying.
In FY2006, Komatsu established the Meister system that focuses on the passing down of technical know-how from production sites.
Techniques and skills that we have judged to be worth passing on are divided into 9 elds that each comprise of 15 speci ccompetencies, with a "First Meister" certi ed for each competency. Under Komatsu's Mother Plant System, production plants withproduct development capabilities are speci ed as "Mother Plants". These plants are responsible for the purveyance of product safety,
quality, cost, and delivery of their "Child Plants" (plants that produce the same product). Meisters who have been certi ed inaccordance to their high pro ciency in speci c technical areas are tasked with guiding and nurturing engineers at both domestic plants
and overseas "Child Plants".
Komatsu also conducts vigorous improvement activities by holding all-Komatsu quality control competitions on the third Saturday of
every November. Much like our technical competitions, employees from our overseas subsidiaries and business partners across ourvalue chain are welcome to participate.

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Strengthening Our "Gemba" Capability

DATA
Status of Human Resource Development at the Manufacturing Gemba
FY2017
All-Komatsu Technology Olympics

All-Komatsu QC Competition

FY2018FY2019Number ofparticipants

181

198

200

From overseas

39(11 countries)

39(11 countries)

38(10 countries)

Number ofparticipants

94

93

96

From overseas

33(14 countries)

36(14 countries)

36(14 countries)

Countries of Dispatch in FY2019 to All-Komatsu Technology Olympics and All-Komatsu QC Competition
All-Komatsu Technology Olympics

United States, United Kingdom, Germany, Italy, Sweden, Russia, China, India, Indonesia, Thailand(10 countries)

All-Komatsu QC Competition

United States, Brazil, Chile, United Kingdom, Germany, Italy, South Africa, Sweden, Australia, Thailand, Indonesia,
India, China, Russia(14 countries)

Service Personnel Human Resource Development

Framework Promoted by Department for Promotion of Distributor HR Development
Our service personnel, who support the operation of our products delivered to customers, take essential responsibility for the Komatsu
values of “Quality and Reliability.” Komatsu thus has been focusing on the human resource development of employees in the company
and of our distributor service personnel.
As means for internal training and human resource development, we established the “Techno Service School” for training our Japanesesta, and the “ the Komatsu Philippines” for training our Filipino sta, to conduct planned training by applying a job rotation system
within the company including our overseas oces.
As for the human resource development of distributors' service personnel around the world, Komatsu plans and supports
each program depending on the content. Komatsu provides curricula and training materials for basic training courses on products andservices, and the local companies (Komatsu subsidiaries or distributors) conduct actual training. We also provide advanced training
courses by inviting managers and senior service personnel to Japan, as well as special technical training courses provided by thetraining centers (mother training centers) which have specialized skills.
Having set up these training environments and assessing the quality of our distributors through small exams sometimes, we have been
providing practical training opportunities that bring synergy to sales promotion activities.

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Strengthening Our "Gemba" Capability

TOPICS
Training activities at the Dubai Training & Demonstration Center in Dubai, UAE

Aiming at enhancing training functions for distributors in the Middle East and Africa regions, we established “Dubai Training &Demonstration Center” in Dubai, UAE, and started training activities in April 2019.
The Dubai Training & Demonstration Center provides the training necessary for construction equipment distributors, including
training in sales promotion, parts, services, and machine operations. At the training center, Komatsu certi ed instructors work,and conduct (1) practical training to develop understanding by seeing and experiencing real machines and equipment, and (2)systematic training globally equivalent in quality. The center not only provides product and technical training for distributors,
but also accommodates a wide range of services such as product demonstrations and test operations for customers as sales
promotion activities, as well as training for operators.
In April 2019, soon after it was established, we provided new product introduction education for our new PC210 and PC500
hydraulic shovels for the sales and service personnel of local companies and distributors. We explained the design concepts
and features of those models and provided education leveraging the advantages of the newly established training center,
which resulted in high marks from the trainees.

The Dubai Training & Demonstration Center

Viewing stand for workshops and demonstrations

Participants inspecting new products

New product demonstration

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Brand Management Initiatives

Brand Management Initiatives
What are Brand Management Initiatives?

Becoming Invaluable to Our Customers, who Both Create and Assess Our Corporate Value
Komatsu embodies this concept in our statement "our corporate value is the total sum of trust given to us by society and all
stakeholders." With this in mind, Komatsu's basic management policy is focused on increasing our corporate value through customer
engagement initiatives. Having grouped our various stakeholders into two distinct categories, while the former is responsible for
employees, aliate companies, sales / service shops, etc., the latter includes society, shareholders, investors, media, etc. We havecome to the conclusion that it is only our customers who take on both of these roles. Customers create corporate value by purchasing
our products, and assess our corporate value through the use and evaluation of our products (which returns to us via feedback). We
have thus redened the meaning of "heightening the trust placed in us from our customers", into a commitment to "increase the trust
placed in us to a degree at which our company is indispensable to our customers, in order to guarantee complete customer loyalty andretention". As of FY2007, we have begun initiatives designed to mold our brand into one that conceptuali(es this vision.

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Brand Management Initiatives

Realizing Our Customers' Vision and Mission "from the Customer's Perspective"
Our brand management (BM) activities are built on the fundamental principle of "from the customer's perspective". One of the mostcommon misconceptions regarding marketing activities is that such initiatives involve nding means to dierentiate a product from thecompetition, or about nding a unique position within the market. Komatsu believes, however, that the crux of marketing involves
working from the customer's perspective, discovering what customers want and responding specically to those needs.
To reali*e this grand vision, we are engaged in activities designed to create sustained development and renement in our management
resources and capabilities. In the past, these initiatives tended to rely on experience and intuition, but in the context of Komatsu's BM
activities, we have replaced them with a variety of tools and methods designed to develop case studies and accumulate validated
experience that can be disseminated to a new generation of employees.
Through discussions over time with our clients, we clarify their Vision (the ultimate future ideal state),Mission(Requirements that mustbe achieved in reali*ing the Vision), and Goals(specic items that need to be accomplished). Once we have a good grasp of what ourcustomers are looking for, Komatsu implements a plan that utili*es our management resources and abilities eciently to achieve said
goals. Ultimately, we believe that strong determination is the key aspect in governing the implementation and subsequent success of
our BM initiatives.
This chart serves as a summary for the ow of processes involved

Figure 1: Customer relationship chart

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Brand Management Initiatives

In addition, as a way to conrm the results of our activities, we have developed an evaluation tool (Figure 2) that evaluates therelationship between customers and Komatsu, separating them into seven dierent categories. These seven categories range from "nouse for us (Level 1)" to "Komatsu is indispensable for us (Level 7)". As a company, we strive to create good relationships with ourcustomers and are thus using this tool to provide a clear indicator of what we must do to climb towards a higher level of satisfaction.
With that said, we are aware that the levels on this chart make use of self-evaluations based on the subject matter provided by local
agents, and thus take that fact into consideration when evaluating the rise and fall of relationship levels with individual customers. We
continue to improve on our customer relationships while carrying our daily BM activities, so that Komatsu will become an
indispensable partner of customers' continuous choice.

Figure 2: Relationship level model90

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Brand Management Initiatives

Recent Activities and Future Plans
When we began in FY2007, the scope of our activities was limited to Japan, North America, Chile, South Africa and Australia. By FY2013,
we had expanded these activities to include China, Southeast Asia, Europe, Brazil, Oman, the Commonwealth of Independent States,
and the forestry business. In FY2011, we ocially declared our approach as the KOMATSU Way of relating to customers, compiling the"KOMATSU Way of Brand Management."
In FY2017 (more than 10 years since the start of our initiatives), we developed a customer needs stratication sheet to further deepen
our insight into "customer perspectives". Through this useful tool, we have become able to review customer needs in a clear,hierarchical format, enabling us to perceive what customers wish to achieve. We also hold workshops on a global scale, focusing on thetheme of customer needs.
Brand management activities that began with a focus on stakeholders by our marketing department have expanded into companywide activities that involve our production and development divisions. Owing to the positive strengthening eects it has on our various
departments and human resource development circles, Komatsu will continue to promote brand management activities for theforeseeable future.

Europe BM Workshop (Brussels, June 2019)

Global BM Workshop (Komatsu in Japan, October 2019)91

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Quality of Life

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Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Theme 3 : Growing with Society

093

Corporate Governance096

Corporate Governance Indicators

101

Compliance105

Human Rights Policy

107

Business and Human Rights

108

Risk Management112

Occupational Safety and Health122

Outline of Procurement Policy and Supply Chain129

CSR Procurement Guidelines

136

Support for Member Companies of the Komatsu Midori-kai (Management and Society)145

Our Suppot for Midori-kai member companies （Environment）

152

Safety and environmental initiatives at sales and service companies

154

Environmental Risk Management

165

Biodiversity

170

Communication with Stakeholders
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Theme 2 :Developing
PeopleData

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Activities

Index

Corporate GovernanceTOP > Investor Relations > Corporate Prole > Corporate GovernanceCorporate Governance
Basic StanceEstablishment and Improvement of Corporate GovernanceComplianceCorporate Governance Report

Organi.ational ProleBasic StanceWe, at Komatsu Ltd., believe our corporate value is the total sum of trust given to us by society and all stakeholders. To become acompany which enjoys more trust from shareholders and all other stakeholders, we are working to strengthen corporate governance,
improve management eciency, advocate corporate ethics and ensure sound management on a group-wide basis. To further improve
the transparency of management for our shareholders and investors, we disclose information in a fair and timely manner and actively
engage in investor relations’ activities by holding meetings with shareholders and investors.

Establishment and Improvement of Corporate GovernanceIn 1999 Komatsu Ltd. introduced the Executive Ocer System and has been working to separate management decision making andsupervisory functions from executive functions to the extent permitted by laws and regulations. At the same time, we also limit theBoard of Directors to a small number of members and appoint Outside Directors and Outside Audit & Supervisory Board Members. To
improve the eectiveness of discussions at meetings of the Board of Directors, we have worked to reform their operational aspect,primarily by putting in place a system to ensure thorough discussions of important management matters and prompt decision making.
We have also established the International Advisory Board (IAB) as a means to supplement executive functions.

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Theme 3 :Growingwith Society

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Index

Corporate GovernanceCorporate Governance of Komatsu

Organizational Pro le
Board of Directors

Komatsu Ltd. holds Board of Directors’ meetings periodically at least once every month. The Board of Directors deliberates and makes
resolutions on important matters, determines management policies of Komatsu, and rigorously controls and supervises the executionof duties by all members of the executive management team including Representative Directors. Of the 8 Directors on the Board, three
are Outside Directors to ensure transparent and objective management.
Directors, Auditors and Ocers

Audit & Supervisory Board
The Audit & Supervisory Board consists of ve (5) Audit & Supervisory Board Members, including three (3) or more Outside Audit&Supervisory Board Members. The Board meets periodically at least once every month in principle and determines audit policies andthe division of duties among Audit & Supervisory Board Members. Based on audit policies, each Audit & Supervisory Board Member
audits the execution of duties by Directors and hears reports from members of the executive management team on their execution of94

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Corporate Governanceduties, thereby performing appropriate audits. To assist the Audit & Supervisory Board Members in their duties, the Company has
established the Oce of Corporate Auditors’ Sta, allocates necessary sta, and budgets expenses, which are regarded as necessary to
perform their duties based on audit plans, thereby performing appropriate management and execution.
Directors, Auditors and Ocers
Independence Standards or utside irectors and utside uditors
The Board of Directors of Komatsu Ltd. has determined the independence standards for Outside Directors and Outside Auditors.
Independence Standards for Outside Directors and Outside Auditors

Compliance
We have established the Compliance Committee as the group to oversee compliance, and it regularly reports its reviews and activities
to the Board of Directors. We shall also establish a system to ensure Directors and employees thorough compliance to business rules aswell as laws and regulations through a variety of measures, including the provision of Komatsu Code of Worldwide Business Conduct,
appointment of the Executive Ocer in charge of compliance, and establishment of the Compliance Department. Through all of these,
we work to supervise, educate and train Directors, Audit & Supervisory Board Members and employees. In addition, we shall establish
the internal reporting system where those who are discretely reporting questionable actions in light of laws and regulations andbusiness rules will not be penali4ed.

Corporate Governance Report
Corporate Governance Report (Last Update: Jun, 29, 2020) (636KB)

To view PDF les you will need to download and install Adobe Acrobat Reader

Copyright © 2020 Komatsu Ltd. All rights reserved.

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Corporate Governance Indicators

Corporate Governance Indicators
Corporate GovernanceFisca
2015

Fisca
2016

Fisca
2017

Fisca
2018

Fisca
2019

Women

0

0

0

1

1

Men

7

7

5

4

4

Total

7

7

5

5

5

0

0

0

0

0

Men

3

3

3

3

3

Total

3

3

3

3

3

10

10

8

8

8

6

6

4

4

4

60

60

50

50

50

30

30

38

38

38

0

0

0

13

13

0

0

0

0

0

Men

2

2

2

2

2

Total

2

2

2

2

2

Women

1

1

1

1

1

Men

2

2

2

2

2

Total

3

3

3

3

3

Unit
Number of Internal
Directors
Number of Directors*Entering the number ofpeople after the ordinary
general meeting ofshareholders

Number of
Independent
Directors

Women

Members

Total
Number of Corporate Executive O cers on the Board

Members% of Corporate Executive O cers on the Board% of Independent Directors on the Board％% of Women on the Board
Number of Audit &Supervisory Board
Members

Women
Number of Internal
Members

Number of
Independent Members

96

Members

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Quality of Life

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Theme 2 :Developing
PeopleSocialContribution
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Data

Index

Corporate Governance Indicators

Corporate Governance
Unit
Total
% of Independent Audit & Supervisory Board Members％% of Female Audit & Supervisory Board Members

Fisca
2015

Fisca
2016

Fisca
2017

Fisca
2018

Fisca
2019

5

5

5

5

5

60

60

60

60

60

20

20

20

20

20

Average Age of Board Members

Age

60.8

61.8

63.2

63.2

60.6

Term Limits for Board Members

Years

1

1

1

1

1

Number of Board Meetings

Times

15

17

15

15

15

Board Meeting Attendance

％

100

99

100

100

99

Attendance of Independent Directors at Board Meetings

％

100

98

100

100

100

Number of Directors Attending Less Than 75% of Board Meetings

Members

0

0

0

0

0

Number of Audit Committee Meetings

Times

15

15

15

15

15

Audit Committee Meeting Attendance

％

99

97

100

99

100

Attendance of Independent Auditors at Board Meetings

％

98

96

100

98

100

Members

0

0

0

0

０

1

2

2

1

2

32

32

30

29

31

33

34

32

30

33

3

6

6

3

6

-

0

0

0

0

-

26

27

29

26

-

26

27

29

26

0

0

0

0

0

Number of Auditors Attending Less Than 75% of Board Meetings
Number of Executive
O cers*Excl. Board Members

Women
Men

Members

Total

Ratio of Female Executive O cers

％

Women

Number of Executive
O cers(Global O cers)

Men

Human
Resource Advisory
Committee Meｍbers

Number ofInternal Members

Members

Total
Women

97

Members

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Corporate Governance Indicators

Corporate GovernanceFisca
2015

Fisca
2016

Fisca
2017

Fisca
2018

Fisca
2019

Men

2

2

2

2

2

Total

2

2

2

2

2

Women

0

0

0

0

0

Men

3

3

3

3

3

Total

3

3

3

3

3

5

5

5

5

5

Unit

Number of
Independent
Members
Total

Number of Human Resource Advisory Committee Meetings

Times

1

1

1

2

3

Human Resource Advisory Committee Meeting Attendance

％

100

100

100

100

100

Women

0

0

0

0

0

Men

1

1

1

1

1

Total

1

1

1

1

1

1

1

1

1

1

Men

3

3

3

3

3

Total

4

4

4

4

4

5

5

5

5

5

Number of Internal
Members
Number of Compensation
Advisory Committee Meｍ
bers

Number of
Independent
Members

Women

Members

Total
Number of Compensation Advisory Committee Meetings

Times

1

2

2

1

1

Compensation Advisory Committee Meeting Attendance

％

100

100

100

100

100

98

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Quality of Life

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Theme 2 :Developing
PeopleSocialContribution
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Data

Index

Corporate Governance Indicators

Compensation
Unit

Fisca
2015

Fisca
2016

Fisca
2017

Fisca
2018

Fisca
2019

Millions
of
Yen

100

100

100

102

103

46

36

73

93

41

PerformanceBased Remuneration (StockBased)

23

19

19

99

46

Total

169

155

192

294

190

Basic Remunerations

397

427

357

357

345

Stock Options

0

0

0

0

0

Performance-Based Bonuses in
Cash

183

154

246

310

130

Performance-BasedRemunerations (Stock-Based)

95

83

68

300

147

Total

675

664

671

967

622

Basic Remunerations

84

86

86

87

87

Stock Options

0

0

0

0

0

Performance-Based Bonuses in
Cash

0

0

0

0

0

Performance-BasedRemunerations (Stock-Based)

０

0

0

0

0

Total

84

86

86

87

87

Basic Remunerations

85

85

85

103

108

Stock Options

0

0

0

0

0

Performance-Based Bonuses in
Cash

9

9

9

0

0

Basic Remuneration
Compensation of Chief
Executive O cer

Compensation of Directors*Excluding External
Directors*Including those who retired
during the term

Compensation of Audit &Supervisory Board
Memers*Excluding External Audit &Supervisory Board Memers*Including those who retired
during the term

Compensation of External
Directors and External Audit&
Supervisory Board Memers

Performance-Based Bonus in
Cash

99

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Corporate Governance Indicators

Compensation
Fiscal2015

Fiscal2016

Fiscal2017

Fiscal2018

Fiscal2019

Performance-BasedRemunerations (Stock-Based)

4

4

5

0

0

Total

98

98

99

103

108

Unit

Shareholder ights
Anti-Takeover Measures

None

Compliance
Clawback
provision

Yes

The individual agreement for allocation of the stock-based compensation (shares with restriction on transfer)
stipulates that if the board of directors decides that it is appropriate to return the stock, it shall be returned.
Unit

Political Contributions

Fiscal 2015

Fiscal 2016

Millions of Yen

Fiscal 2017

Fiscal 2018

Fiscal 2019
8100

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Compliance

Compliance
Promoting ComplianceKomatsu considers the maximi3ation of corporate value with the pursuit of Quality and Reliability as a core component of ourmanagement principles. The Company believes its corporate value is the total sum of trust given to the Company by society and all our
stakeholders.
In order to raise the total sum of reliability, it is necessary not only to improve business performance and to enhance the soundness andtransparency of management, but to also become a company that has acquired societal trust. Thus, it is increasingly important for any
company to comply with the rules of business society.

Frameworks for Promoting ComplianceTo make certain that the entire Komatsu Group complies with the rules of the business community, Komatsu has appointed an
executive ocer at the head oce in charge of compliance, and established the Compliance Department to handle this issue
exclusively. The Compliance Committee, chaired by the president and CEO, deliberates the Group's action policies and important
issues while regularly reporting the state of compliance-related activities to the board of directors.

Komatsu's Worldwide Code of Business Conduct
The company has formulated Komatsu's Worldwide Code of Business Conduct (established in 1998 and revised nine times to date) as acompilation of best business practices to be observed by ocers and employees of Komatsu Group companies around the globe. Rulesof business society include not only laws in a narrow sense, but also outlines rules that are generally respected in society. Also, today,
as the importance of roles to be played by company in society is increasing, it is important for each and every employee to be fully
aware of "corporate social responsibility" and to act in a manner that gains society's trust. Komatsu's Code of Conduct, which shows
the basic principles, policies and philosophies that should be observed anywhere in the world, is an excellent guide to living inaccordance with the rules of these broad business societies.
“Komatsu’s Worldwide Code of Business Conduct” consists of two major parts. The rst part claries the Komatsu Group's compliancepolicy and declares that executives and managers of each Komatsu Group company comply with it. The second part specicallydescribes what all Komatsu employees worldwide should and should not do in order to comply with the rules of the business industry
as individuals. We explain easy-to-understand examples of basic ethics in business operations, antitrust laws and anti-corruption.
Komatsu considers CSR as a key responsibility, which is shown by Komatsu's Worldwide Code of Business Conduct clearly focusing on
the importance of CSR. The pillar of Komatsu's compliance activities is based on constant repetition of the following process, outlinedin the Code : (1) Formulate the Code, (2) Implement the Code, (3) Determine the Code's current status, and (4) Address inadequacies.
Komatsu's Worldwide Code of Business Conduct is available at:
Komatsu's Worldwide Code of Business Conduct

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Theme 2 :Developing
PeopleData

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Index

Compliance

Process for Compliance Activities
1. Formulate the Code:
Formulate the Code and the Five Principles of Compliance as a foundation for compliance activities and revise the Code (currently
in its tenth edition) as required to reect social change.
2. Implement the Code:
Implement the Code through education that corresponds to employee rank and their respective duties, and by communicating
information in accordance with the Code.
3. Determine the current status:
Determine whether we comply with rules of business society by having all business units regularly report on their use of the Code,
implementing compliance and risk audits, conducting "visualization survey" of potential risks and enhancing Komatsu's internalreporting system.
4. Address inadequacies:
Any issues identied during the above activities or otherwise will be addressed in accordance with the Code and be rectied
through implemented preventive measures.

Upholding Thorough Compliance
So that employees remain acutely aware of compliance all the time, the Group is working to cultivate their consciousness of best
business practices by displaying business unit posters in every Komatsu Group listing The Five Principles of Compliance (a condensed
version of Komatsu's Code of Worldwide Business Conduct). As for employee education, we have been expanding global e-learningsince the 10th edition of Komatsu's Code of Worldwide Business Conduct to help employees across all operations understand the Code.
Also, compliance training in the form of group education is being conducted according to the levels of managers and generalemployees. In addition, we are expanding business-specic compliance training, and individual training in response to requests fromdepartments. Furthermore, as training for risks for overseas operations, education on anti-corruption, antitrust laws, export control
and more is provided to prospective employees to be based abroad.
We have established a "Compliance Portal" on our intranet to ensure wide-spread awareness. The monthly magazine " verybody’sCompliance" provides explanations of important laws, lessons learned from other companies, and articles on human rights,
harassment prevention and trac rules for general business-related practices. Articles on anti-corruption, antitrust laws, and export
control have been repeatedly published as particularly important elds.
The Group strives to detect risks early and implement reforms at Komatsu business units and Group companies through monitoring
during nancial audits and compliance and risk audits. The monitoring covers compliance in highly important areas such as safety andenvironmental practices.

Internal Reporting System
Komatsu has established the "Compliance Hotline" consultation oce both internally and externally at the Komatsu Group companies
to respond to consultations or reporting from Group company employees that pertain to rules of business society aiming for prompt
detection and correction of those problems. The Group actively encourages consultations and reporting through Komatsu's Worldwide
Code of Business Conduct, the Five Principles of Compliance, and Group companies' workplace rules, making it clear that employees
who use the system for appropriate reporting will not be treated unfairly in any way as a result of their action.

Status in FY2019
No incidents of note occurred during 2019.

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DATA

1. Number of Internal Reports
FY2017
Number of Internal Reports(number of serious cases)

FY2018105 (0)FY2019134 (0)141 (0)2. About Komatsu's Worldwide Code of Business Conduct
Established

January 1, 1998

Last revised

October 1, 2017 (10th edition)

Languages

20 languages
Japanese, English, Chinese, Spanish, Portuguese, German, Dutch, Italian, Polish, French,
Swedish, Finnish, Indonesian, Thai, Russian, Turkish, Persian, Tamil, Taiwanese, Korean

3. Compliance Education in FY2019
Global training on the code of
conduct (e-learning and grouptraining)

Approx. 51,000 people<Group training (mainly apan)>・Level-based training
・Individual training by
request(domestic o ces andrelated companies)
・Individual training by
request(dispatching instructors tooverseas subsidiaries)

Approx. 1,600 people
Approx. 900 people
Approx. 200 people

4. Compliance violation in FY2019
No compliance violation had a signi cant impact on the management of the company.

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5. With regards to anti-corruption
Number of employees who weredismissed because of con ict with
Komatsu's anti-corruption policy(global)Fiscal Year 2019: ZeroFines imposed on omatsu related
to corruption  mount of penalties(global)Fiscal Year 2019: ZeroFiscal year 2019: 13 times
Target audience: Approximately 100 (planned to be transferred overseas)

Number of employee training
sessions on anti-corruption
prevention (in apan)

Establishment of internal reporting
system related to corruption(global)Prevention of corruption is specied in "Komatsu's Worldwide Code of Business Conduct"as a key priority issue. If there is any suspicion or concern involving corruption or theviolation of business society rules, concerned parties are invited to use the Compliance
Hotlines established at the Komatsu Head Oce or within each region to report the
problem.

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Human Rights Policy

Human Rights Policy
Komatsu established its Human Rights Policy in September 2019, thereby declaring its commitment to promoting respect for humanrights in line with internationally accepted standards. Through human rights due diligence based on the United Nations Guiding
Principles on Business and Human Rights, we will implement measures for preventing or mitigating negative impacts on human rights.
In addition, frameworks will be put in place to allow for corrective measures to be instituted should it be found that the Company was
directly or indirectly involved in activities that had a negative impact on human rights.

Human Rights Policy
1. Respect for Human Rights
The KOMATSU Way describes the values that all ocers and employees in the Komatsu Group, including those at top
management level, should inherit in a lasting way. To implement the KOMATSU Way, it is necessary that we act responsiblyin accordance with the expectations of society. Komatsu believes that it is essential to ensure that respect for humanrights is rmly embedded within our company and therefore applies the human rights policy to Komatsu’s worldwide
operations to conduct its business. This policy is formulated based on international human rights principles encompassedby the Universal Declaration of Human Rights. In addition to promoting business activities in line with this philosophy,
Komatsu promotes activities that respect human rights such as the prevention of child labor and forced labor and theelimination of excessive working hours, the prevention of discrimination and harassment, the right to freedom of
association, the right to collective bargaining, minimum wage, health & safety, etc., in accordance with the “United
Nations (UN) Guiding Principles on Business and Human Rights” and the “ILO Core Labour Standards”. Komatsu Group willcomply with the laws and regulations of all countries where it conducts its business activities. Where establishedinternational human rights norm exists as well as national laws, we will follow the higher standard; where they are inconict and will seek ways to respect internationally recogni5ed human rights to the greatest extent possible.
2. Stakeholder Engagement
When we talk about “stakeholders”, we refer collectively to all parties that are aected by our business activities.
Stakeholders include customers, shareholders, investors, distributors, suppliers, local communities and employees. We
will consult with independent external knowledge on human rights issues and respect dialogue and discussions withinternal and external stakeholders to understand human rights related issues. We will regularly and publicly communicate
our activities on human rights based on this policy through our reports and/or Group website.
3. Local Communities
Companies cannot continue to exist without maintaining good harmony with the local community. Komatsu wishes to be
the most transparent company which actively seeks harmonious balance of interests with the local communities throughclose communication and contributes to the local communities as a valued corporate citi5en.
4. Human Rights Issues (Assessment and Due Diligence)
In our eort to apply the major principles for protecting human rights, we conduct human rights risk assessments for our
existing and new construction/mining equipment and forestry machinery businesses worldwide with the help of external
experts. In addition to risk assessments, we will conduct CSR procurement assessments for suppliers and promote CSR
procurement through improvement activities based on the results of the assessments.
5. Guidance for employees, distributors and suppliers
In order to ensure the eectiveness of this policy, we will conduct appropriate training and activities to raise awareness in
employees throughout the Group. We will also expect and encourage our distributors and suppliers to comply with thispolicy in their own operations.

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6. Remedy
We have established and maintained a Global Compliance Hotline at its headquarters to take reports relating to noncompliance, including regarding human rights issues and make this Hotline number known to all Komatsu Group
Members. Any employee who believes a conict arises between this policy and the laws, customs or practices of the place
where he or she works, or who has questions about this policy or would like to condentially report a potential violation ofthis policy, should raise those questions and concerns with the Hotline anonymously. In addition to the Hotline for
Komatsu Group Members, anyone other than Komatsu Group Members who become aware of any circumstance or actionthat violates or appears to violate this policy or applicable law with respect to human rights, can le a reportanonymously. They can contact us at https://home.komatsu/en/inquiry/ or call at +81-3-5561-4711.

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Business and Human Rights

Business and Human Rights
Human Right Management Issues
Komatsu signed the United Nations Global Compact in 2008. In an eort to apply its major principles for protecting human rights,
Komatsu utili;ed the help of external experts (BSR, or Business for Social Responsibility) to conduct a human rights risk assessment for
all of its construction/mining equipment and forestry machinery businesses worldwide in 2014 and once again in 2017, taking guidancefrom the Universal Declaration of Human Rights and the U.N. Guiding Principles on Business and Human Rights.
The human rights risk might not be removed depending on the business, area and contractors, so we will respond exibly as needed.
In September 2019, we established the Human Rights Policy, declaring that we would respect human rights based on international
norms. Based on this policy, we implemented due diligence utili;ing external experts regarding Myanmar, which is considered to havepotential risks, to understand the problems there. We are providing education to our employees, distributors, and suppliers in the
country to ensure they are compliant with the Komatsu Worldwide Code of Business Conduct and Human Rights Policy.

Human Rights Training and Awareness-raising
Recogni;ing it is important for all employees to correctly understand and adhere to the Human Rights Policy, Komatsu will conductongoing activities to raise awareness along with human rights training such as human rights e-learning program.
In addition, we publish the monthly Compliance Newsletter to further contribute to awareness-raising in employees. This
newsletter contains articles explaining important legal regulations, highlighting the lessons to be learned from episodes at othercompanies, and describing comprehensive principles in business today with regards to human rights, prevention of harassment, tracrules, etc.

Future Human Rights Initiatives
Komatsu has established the CSR Committee on Human Rights, which comprises the President and CEO as well as the heads of relevant
divisions and departments (Construction Equipment Marketing Division, Mining Business Division, Production Division, Procurement
Division, Human Resources Department, and legal aairs, risk management, compliance and CSR promotion divisions).
This committee will serve as a forum for in-depth understanding of human rights issues.
Going forward, the CSR Committee on Human Rights will endeavor to identify priority issues and lay out clear policies foraddressing individual issues. In addition, concrete implementation plans will be established for implementing to these issues in actual
business practices.

Corresponding to the Modern Slavery Act (UK)In response to the "Modern Slavery Act 2015" (a law preventing the system of slavery in the current era) being enacted by the UK in
October 2015, Komatsu UK Ltd. revised its “Slavery and Human Tracking Statement for the Financial Year 2015.” disclosed on the website.Recogni;ing the possibility of the risk of human rights violation occurring in Komatsu's business operations and its supply chains,
this statement reports how such an issue will be properly managed.
Komatsu UK Ltd. website

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Risk Management

Risk Management
The Komatsu Group recognizes all uncertainties that could threaten the Group's sustainable growth to be major risks, particularlycompliance issues, environmental issues, product quality concerns, hazardous accidents, information security problems and anti&social forces. The company has adopted the following measures to counter these risks.

Basic Principles and Structure for Risk Management
In addition to the basic policy for risk management to ensure business continuity and stable development, Komatsu has established
Risk Management Rules to correctly recognize and manage risks.
Komatsu has established a Risk Management Committee to devise relevant policies for the entire Group, review the risk management
system, and evaluate and improve upon response measures in place for each risk, as well as to take control of risks when they arise.
The committee regularly reports on its deliberations and activities to the board of directors.
Komatsu will establish an emergency headquarters when serious risks occur and implement appropriate measures to minimize
damage.
We are developing risk reporting lines, preparing related manuals and making other eorts to further improve the risk management
system of the entire Group, including overseas subsidiaries.
We have reected climate change risks in this system for management.

Risk Management Structure108

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Speci c initiatives

Establishing a business continuity plan (BCP) and providing training
Komatsu has established a BCP to continue or quickly restore important operations. We implemented initial response training at eachbase in Japan to improve their risk management level and their ability to respond to disasters. We have introduced the safety checksystem to promptly check the safety of employees and their families when a disaster or accident occurs as well as wide-area wirelessdevices and other tools at each base of the group. Through regular safety reporting and communication training, we are enhancing the
emergency communication capabilities of the entire group. Each base in Japan also conducts regular training to ensure thatappropriate actions are taken during a disaster by role-playing the occurrence of a large earthquake.
Furthermore, considering the recent frequent occurrence of large natural disasters, each of our bases is seismically reinforcing
buildings and facilities and enhancing countermeasures against concentrated heavy rains based on their own plans. We are focused on
not only strengthening the BCP of each base of the Komatsu Group but also strengthening the supply chain system through our
support of our business partners as they establish and improve their BCPs. Komatsu will continue to promote and enhance our Groupwide BCP initiatives.

BCP training

BCP training at Osaka Plant

BCP training at GIGAPHOTON

Response to the COVID-19 coronavirus

With the safety and health of our customers, partner companies, people in local communities, and our employees and their families set
as our priority, the Komatsu Group is striving to prevent the spread of the COVID-19 coronavirus based on the government policies ineach country.
To ful ll our responsibilities to customers involved in businesses that support social infrastructure (essential businesses), we havecontinued to supply products, parts, and services to our customers while thoroughly taking measures to prevent infection.
In the middle ofd March, we determined that we had entered the Infection and Pandemic phase, a management item in the Basic
Manual for Risk Management, and set up an Emergency Task Force with our president as its Chairperson. Since the state of emergency
was declared in Japan in April, we have carried out remote meetings almost every day including the president, internal directors, andthe heads of functions to share the latest information about the situation at the global level and determine the correct actions to take.
In addition, the president also regularly reported this information and these actions to the board of directors.
We have posted news releases on our website to keep all stakeholders updated on the status of our global production activities, etc. as
needed, striving to ensure that information is delivered promptly to all stakeholders.

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Conducting Compliance and Risk Audits
As a part of its risk management activities, Komatsu has been conducting compliance and risk audits (CR audits) since FY2008. These
covered areas are not included in J-SOX audits, which are conducted in accordance with the Financial Instruments and Exchange Act ofJapan to evaluate the internal controls related to nancial reporting, and identify potential compliance risks within the company, witha particular focus on conrming and evaluating the status of legal compliance. Our internal specialist team conducts the internal audits
at Komatsu and its Japanese/overseas aliates, as well as at independently owned distributors and business partners. Through theseaudits, we strive to raise control and compliance awareness levels at each company and in every department. We are improving our
audit method according to changes in the business environment and raising the operational level of CR audits as a part of our risk
management functions.
The audited items are:
1. Safety, 2. Environment, 3. Labor, 4. Finance and Treasury, 5. Quality Assurance and Recall, 6. Vehicle Inspections and Specic
Voluntary Inspections (inspections required by law), 7.Export Control, 8. Information Security, 9. the Anti-monopoly Act, 10. theSubcontract Act
In addition, as CR audits that cover areas across the above items, we implement eld instructor audits (Safety, Environment) and auditsof sales oce bases (Finance and Treasury, Labor, Information Security), which are implemented at each distributor base, as well as
audits of overseas representative oces (Finance and Treasury, Labor, Information Security), which are implemented for overseasoces.

Strengthening Information Security
Komatsu is developing an information security structure for the entire Group, placing theInformation Security Committee at its center. As part of this structure, we distribute an Information
Security Guidebook to all employees, based on which we provide education and awareness-raising
activities, with the belief that raising the awareness of individual employees is essential for
information security. We provide employees of the Group companies who use PCs with basic
education on information security through e-learning and training for responding to targeted attack
e-mails that uses fraudulent messages. Additionally, we provide our executives with e-learning toraise Group companies’ awareness of security measures.
Moreover, we develop a system defense structure to protect information from being falsied,
destroyed, leaked, lost, etc. due to negligence or outside intrusion. We also conduct information
security audits to ensure that these measures are working eectively and to detect and address any
problems.

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DATA
Record of BCP Training
Content of Training

Business ite

Earthquake initial response training
BCP training
Communication training with Broad-area
Wireless Devices

Major business sites in Japan

Safety Reporting

All Group companies in Japan

Implementation of Compliance and Risk Audits

Employee Education (Information Security)
Na e of Course

TargetNew Employee Training

New employees (both new graduates andexperienced hires)e-learning Information Security (Basic Course)

All employees who use PCs at worke-learning Information Security (Management Course)

All managers (line managers such as GMs andsection mangers)

Training for responding to targeted attack e-mails

All employees who use PCs to perform duties

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Occupational Safety and HealthOccupational Safety and HealthOccupational Safety and Health is a core component in Komatsu's business operations. In line with this commitment, Komatsu thus
enhances safety at the workplace for our employees and business partners.

Our Approach to Safety and Health at the Workplace
Komatsu communicates the message of “Safety First” to the Komatsu Group and addresses occupational safety and works on mental
and physical health care to create a safe and comfortable work environment.

Message from the President Concerning Occupational Safety and Health
1. The Komatsu Group shall, rst of all, strive to ensure a safe and comfortable work environment, and maintain andpromote employee health.
2. The Komatsu Group shall promote proactive occupational safety and health activities in order for all employees to achieve
the above conditions by working together as one team.
3. The Komatsu Group shall proactively engage in these safety and health activities for not only our group companies but
also our partners (such as customers, distributors and business partners).
4. Each and every person in a senior management position of the Komatsu Group shall acknowledge the above two mattersas top priority tasks and shall take the initiative in demonstrating the execution of daily duties accordingly.
Considering our obligation to occupational Safety and Health, we have implemented the following guideline: All the Komatsu Group
companies, including all top managers and employees, shall promote occupational Safety and Health activities so that everyone canwork in a safe and comfortable work environment in accordance with the policies described below.

Occupational Safety and Health Policies(Released as a part of the Komatsu's Worldwide Code of Business Conduct on April 1, 2011)
1. Observe the laws and regulations concerning occupational safety and health as well as internal rules, key items common
to the Komatsu Group about occupational safety and health, and particularly items agreed as a result of labormanagement consultations in each workplace.
2. Set up targets for activities based on occupational safety and health policies, review their progress, and endeavor tocontinuously improve and enhance occupational safety and health activities.
3. Carry out occupational safety and health activities in management-and-labor partnership on a full participation basis andkeep good communication with stakeholders with regard to occupational safety and health.
4. Identify and evaluate the risk for occupational safety and health of a workplace and take appropriate actions accordingly.
5. Actively promote employees' healthcare management and support the maintenance and promotion of employees' health.

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6. Actively promote education, training and qualication acquisition necessary for employees' occupational safety andhealth activities, and endeavor to develop human resources for safely carrying out their responsibilities in the workplace.
7. Subject to appropriate protection of personal information, publicly oer the knowledge and information aboutoccupational safety and health activities obtained through the business activities in order to secure safety and health insociety.
In addition to our existing health management programs, the Komatsu Group strives to create a corporate Health Culture and has beenpromoting its Five-Year Health Development Plan, a medium-term health development plan that was established in FY2014 and theSecond Health Development Plan which was established in FY2019. The goal of the Health Culture is: to look after one's own healthand the health of one's colleagues, and to consider and take action on what is necessary for leading a better life. The president
announced the “Komatsu Health Declaration” in June 2014 to eectively promote this goal.

Overview of Safety and Health System
The Komatsu Group enforces strict compliance with Safety and Health management through the following system structure.

Organization

Meeting Committee StructureGroup Safety and Health Conference (Safety conferences at Group companies, presentations by small
groups which implement “zero accidents” activities, etc.)

This conference convenes with the aim to increase awareness regarding Safety and Health for employees of the Komatsu Group andpartner companies while raising the level of Safety and Health activities. The conference engages in activities that help all the113

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Occupational Safety and Healthparticipants to share the policy, priorities and best practices of Safety and Health activities, and incorporate these practices into thedaily operations at other divisions. This is also the administration of presidential awards related to Safety and Health.

Group Safety and Health Committee (Safety and Health Committees at Group companies, Plants andOperation Sites)

This committee was formed to enhance cooperation between labor and management to examine, discuss and make decisions on
measures aimed at eliminating risks in workplaces and preventing health risks. This committee formulates regulations concerning
Safety and Health, examines, debates and decides on related policies for the scal year. This is also the occasion to manage theprogress of these activities.
Global Occupational Safety, Health & Environmental A airs Meeting
Participants in this meeting discuss and share information on activities to be implemented globally, and nd things in common withactivities of various overseas subsidiaries to spread them out globally.

Conference for Safety, Health, and Environment in the Community

We shall share and discuss information on safety, health, and the environment in each region globally, leading it to the safe and healthy
activities of each overseas subsidiary. In FY2019, we held the conferences in North America, South America, Europe and China.

Group Health Representatives Meeting

Formulates and makes proposals for all company policies related with safety and health practices.
Promotes and implements practices based on company policies in locations of each business operation.

Meeting Regarding the Mid-Term Health Development Plan

Formulates company-wide Safety and Health management policies and handles the overall supervision of health management
activities throughout various business locations.

Health Promotion Committee

This committee consists of business owners and employees (organi.ed by Komatsu Union) as well as the Health Insurance Society. Thisoccasion arms a common recognition of "Health", and formulates measures and policies aimed to enhance the health carefor employees and their families.

Safety and Health Key Initiatives of Komatsu Group in FY2019[Safety and Health Management]
1. Activities to maintain and raise the management system for labor safety and health
2. Promoting risk management activities
3. Promoting work environment improvements
4. Promoting daily activities with the participation of all employees
5. Enriching safety education
6. Promoting Global and Group-wide safety activities
7. Enhancing compliance risk management
8. Enhancing safety activities at sales bases
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9. Preventing tra c accidents[Health Management]
We are promoting health management activities for the following in accordance with the Second Heath Development Plan:
1. Cancer and lifestyle diseases
2. Tobacco-related diseases
3. Mental health
4. Occupational diseases
5. First aid and infectious diseases
6. Diversity tasks
7. Lifestyle improvement

Establishment of the Second Health Development Plan
In April 2019, we established the Second Heath Development Plan (from April 2019 to March 2022) as a medium-term plan regarding
health development. The Second Heath Development Plan, while continuing the activities of the previous medium-term plan, isintended to promote the creation of a life-long culture of health by establishing a system that helps the employees voluntarily practice"healthy actions" through the enhancement of support structures for the balance of work and health, primary preventative actions(lifestyle improvement), and the introduction of ICT tools, etc. The main initiatives are listed below:
Item

Initiative

FY2019 result

Cancer andlifestylediseases

Increase the percentage of employees using the various health checkup
consultations for the early detection and treatment of cancer andlifestyle diseases and the prevention of severe diseases

・Milestone checkup consultation
percentage: 93.9%
・Female cancer checkup
consultation percentage: 55.4%

Tobaccorelateddiseases

Reduce secondary exposure to cigarette smoke and smoking percentage

・Percent of the Komatsu Group in
Japan that smokes: 31.9％

Lifestyle
improvement

Establish a system or environment that leads to the improvement ofmotivation to improve or promote the healthy lifestyles of employees(e.g. diet and exercise)・Percent of employees with
Healthy Action Competency* :45.7%

Mental health

Reduce the number of individuals with mental disorders, provide earlycare, appropriately support their return to workplaces, and create ahappy and vigorous workplace

・Percentage responding to ourrecommendation to interview
employees under high stress: 100%・Percentage responding to highstress workplaces: 100%

(Scope of FY2019 results aggregation: All employees of the Komatsu Group in Japan)* Capability of voluntarily practicing healthy actions (lifestyle improvement/maintaining an appropriate exercise regimen and diet, etc.)

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Health Seminars for Women
To better inform women about the changes in hormone balance as they age and its impact on health and body condition, etc., we held
health seminars for our female employees at the Shonan Plant, the Manda area, and Ibaraki Plant in FY2019. (The instructors were ourinternal industrial health sta.)
The Diversity Task Team, which was established in the Second Health Development Plan, will continue its activities by setting the goalof holding health seminars for women at all Komatsu bases by the end of FY2021.

Photo of the seminar

Awareness Raising on HIV/AIDS Issues at Komatsu South Africa (Pty) Ltd.
At Komatsu South Africa, we provided an opportunity for our employees to learn about HIV/AIDS as part of the Wellness Day events. The
objective of this initiative is to increase general awareness of health, not only by learning basic knowledge on HIV/AIDS, but also byreceiving medical check-ups and obtaining knowledge on healthy life styles.

On-site Survey of Malaria in Senegal and Cote d'Ivoire
To prevent Komatsu resident ocers and local employees from succumbing to malaria and to improve our response to infection, we
inspected living and work environments in the community and visited medical agencies, etc. in August 2019, accompanied by Komatsu
industrial doctors. Malaria is normal in these countries, and it is dicult to stop it completely. However, to minimi,e the risk of infection
as much as possible, we have dened preventive measures and our responses to inection more clearly.

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Dakar o ce in Senegal

Cote d'Ivoire medical agency

Supporting Supplier's Safety Activities
For details on the safety activities for the member companies of Midori-kai, an organi6ation made up of our business partners(suppliers), please click "Support for Member Companies of the Komatsu Midori-kai" .

Status in FY2019

Educational Training for Labor Safety and Health (in Japan)
Education regarding Mental HealthContents

FY2019 PracticeBased on the rules of the Industrial Safety and Health Act,
educational training for mental health is conducted. Stressassessments were started in FY2006, and stress awarenesstraining were started in FY2007 and is being held for theemployees of all Group companies in Japan.

Stress assessment/awareness training implemented in
14 companies, with approximately 23,105 employees“Support Letter for the Heart”, which is motivational material
for management personnel, is distributed every other month(even months) to management personnel within the Group.

Education based on Job Levels
Contents

FY2019 Practice

Safety and Health education and mental health education isprovided to each level of Komatsu Group companies in Japan
including new employees.

New Employees (1 time, 390 people)
3rd year of employment with the company (10 times,
298 people)
7th year of employment with the company (2 times, 59 people)
Mid-career recruitment (3 times, 68 people)
New Assistant Managers (9 times, 254 people)
Foremen/Senior Foremen (6 times, 168 people)
New Managers (6 times, 201 people)

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Occupational Safety and Health

Education based on Function
Contents

FY2019 Practice

Safety and health education is provided according to function
to the production managers, Production Engineering Division,
and workplace safety and health promotors of Komatsu groupcompanies in Japan.

Safety and health practical training for production managers(once, 18 trainees)
Education for production engineers (twice, 52 trainees)
ISO 45001 standards understanding training (24 times, 487
trainees)
ISO 45001 internal auditor development training (16 times, 341
trainees)

Number of major work-related accidents (fatal)
FY2019: 1 incident （Overseas)

In June 2019, at Komatsu do Brasil Ltda., we had an occupational accident in which one local employee died after being pinched by avehicle that was being assembled.
The Komatsu Group has thoroughly analyzed the causes of these accidents and horizontally disseminated preventive measures.
We take these accidents very seriously, and will continue to actively engage in appropriate safety and health activities to ensure thatsuch accidents will not occur again.

DATA

Incidence Rate of Occupational Accidents (Frequency Rate of Lost Worktime)

1. The data for all industries (Japan) and construction and mining equipment manufacturing industry (Japan) are provided by the
Ministry of Health, Labour and Welfare.
2. The scope of the Komatsu Group (Japan) includes Komatsu Ltd. and group companies in Japan.
3. The scope of the Komatsu Group (global) includes "Komatsu Group (Japan)" and overseas production plants.

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Quality of Life

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Theme 2 :Developing
PeopleData

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Index

Occupational Safety and HealthFrequency of occupational accidents (occupational illness frequency rate)

1. Occupational illness frequency rate (OIFR): Number of occupational illness absences (times) / Total of working hours (hours) x
1,000,0000
2. Occupational illness: Back problems, heat illnesses, chemical poisonings, etc. speci ed by the Ministry of Health, Labour andWelfare3. Komatsu Group (Japan): Komatsu alone + group companies in JapanThe Komatsu Group in Japan has been promoting JISHA OSHMS certi cation and certi cation renewal at each base since FY2007. Since
FY2018, we have fostered activities for obtaining the ISO 45001 integrated international standards certi cation. The Osaka Plant
acquired ISO 45001 integrated international standards certi cation for the rst time in April 2019, and other divisions and Group
companies are expected to undergo certi cation audits between January 27 and February 21, 2020 and then acquire the integrated
certi cation.
In addition, overseas companies have also been promoting activities toward OHSAS 18001 certi cation and the renewal of it. They havebeen working to acquire ISO 45001 certi cation since FY2019.

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Occupational Safety and Health

OSHMS (Occupational Safety and Health Management System) Certi cation and Renewal of Certi cation in Japan(The legends: ◇JISHA OSHMS ●ISO 45001 OSHMS Certication and Renewal)

FYOsaka Plant

~2018

2019

◇

●

Head Oce

Komatsu

Awazu Plant◇

Kanazawa Plant◇

Ibaraki Plant◇

Oyama Plant◇

Tochigi Plant○

Koriyama Plant◇

Shonan Plant◇

Himi Plant◇

Preparation for acquiring ISO 45001 Certication and inspection
received.

Technology Innovation
CenterField Testing Department

Group
Company

Komatsu Cabtec◇

GIGAPHOTON

◇

KELK

◇

Komatsu NTC◇

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Quality of Life

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Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Occupational Safety and Health

Overseas OSHMS (Occupational Safety and Health Management System) Certi cation and Renewal of Certi cation8.2（The legends □：OHSAS18001 ●：ISO45001）
FY

~2018

2019

Komatsu America Chattanooga Manufacturing Operation□●

Komatsu America Peoria Manufacturing Operation□

Komatsu America Newberry Manufacturing Operation●

Komatsu Mining Wadeville●

Komatsu UK●

Komatsu Germany (Construction Division)□

Komatsu Germany (Mining Division)□

Komatsu Italia Manufacturing●

Bangkok Komatsu□

PT Komatsu Indonesia□

PT Komatsu Undercarriage Indonesia□●* OHSMS: Occupational health and safety management systems* OHSAS 18001: Occupational health and safety assessment series

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Quality of Life

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Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Outline of Procurement Policy and Supply Chain

Outline of Procurement Policy and Supply Chain
Our business partners are important members of our value chain, who supply the materials, parts and components necessary for thecontinued operation of our manufacturing enterprise. At Komatsu, we aim to build a Win-Win relationship with our business partners
by making interactive e orts under a relationship of mutual trust. Along with the expansion of our global operation, our supply chain
has also been expanding all over the world. Taking seriously the recent gain of momentum for the spread of CSR in the overall supply
chain, we are working to reali#e CSR procurement globally by being proactive in providing intense support for the CSR initiatives of ourbusiness partners.

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Outline of Procurement Policy and Supply Chain

1. Basic Policy for Procurement
Komatsu's procurement policy is based on the philosophy of aiming to build a Win-Win relationship with our business partners, who
are on an equal footing with us, and encouraging each other. The policy aims to evaluate and select suppliers in a fair and equitablemanner from a SLQDC (Safety, compliance with the Law, Quality, Delivery and Cost) perspective.
In addition, to promote CSR activities in the supply chain, we established and released the CSR Procurement Guidelines in 2011. In
accordance with international guidelines such as ISO 26000 and the 10 principles of the United Nations Global Compact, the guidelines
specify the items we would like our business partners to address, while re ecting the concepts of our code of conduct and the
KOMATSU Way. We have released the guidelines on our website so that they are known and we also work to ensure the guidelines
penetrate into our daily procurement operations.
In order to decide whether or not to begin transactions with a new business partner, we use a check sheet to evaluate the company not
only in terms of basic SLQDC items but also from the viewpoints of environmental protection, employee training and others. In thebasic transaction agreement that we conclude before beginning transactions, we include articles on compliance, environmental
protection activities, elimination of anti-social forces and other elements, thereby encouraging the business partner to promote CSR
activities. In addition, in the annual evaluation of Midori-kai member companies to be described later, we evaluate them in terms of thebusiness attitudes of their top management and their systems for promoting activities in areas such as safety and health,environmental protection and human resource development, in addition to their full-year QDC performance. We provide feedback on
the results of the evaluation to business partners to help them make improvements.
Komatsu Group CSR Procurement Guidelines - Requests for Business Partners

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
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Data

Index

Outline of Procurement Policy and Supply Chain

2. Component Category and Procurement Policy
Komatsu's general production policy is to manufacture products directly within the area of demand. We have 71 of our 85 plants related
to construction or mining equipment overseas.
Concerning components, parts, materials and other items, we are promoting local procurement proactively based on production andprocurement policies that we set in accordance with the characteristics of each. Above all, for Components B and C listed below, we are
expanding cross sourcing between regions to respond exibly to changes in the international trade environment such as exchange rate
uctuations, FTA and EPA, aiming for globally optimal procurement.
Policy on Production and Procurement of Components and Parts for Construction and Mining Machinery
Category

De nition

Components
A

Key components for dierentiation that
determine product quality and functions

Components
B

Components that we need to purchaseintensively from certied suppliers from theviewpoints of functions, quality, andinvestment

Components
C

Parts with relatively low levels of technologicaldiculty, which should desirably be produced
or procured close to the assembly plant

Production andprocurement policy

Examples of parts

Permanent development
and production in Japan(supply from Japan to theworld)Engines, transmissions,axles, hydraulic equipment,
and electronic equipment

Optimal procurement from2 or 3 regions in the world

Floor parts of cabin, coolingparts, undercarriage parts,cylinders, high-pressure
hoses, tires, rims, andoperator's seats

Local procurement

Thick/ thin sheet-metalparts, machined parts, andcast and wrought products
as materials

The breakdown of procurement in monetary terms in the construction and mining equipment business of the Komatsu Group in
FY2019 is shown below.
Components Types by Percentage of Procurement inMonetary Terms

Origin of components by Percentage of Procurement inMonetary Terms

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Theme 2 :Developing
PeopleData

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Index

Outline of Procurement Policy and Supply Chain

3. The Komatsu Midori-kai Supply Chain
In the construction and mining equipment business, Komatsu has
agreements with approx. 2,700 business partners (primary
suppliers) all over the world. From amongest them, we haveestablished the Komatsu Midori-kai which consists ofparticular business partners who are deemed especially
important or critical for the Komatsu Group. The members are
selected through evaluation from the viewpoint of management
culture including the management philosophy of top
management, SLQDC* performance including development andproposal capabilities in business transactions with Komatsu, thelevel of importance of the supplied items in light of our
procurement strategies and technologies, the track record and thesi1e of business transactions with Komatsu, and otherelements. At present, the Komatsu Midori-kai operates in four
regions -- Japan, China, North America and Europe (there are also General meeting of Midori-kai (Japan)
plans to establish it in Thailand in FY2020). Procurement frommembers of the Komatsu Midori-kai account for approx. 76% of
total procurement in monetary terms. The Komatsu Midori-kai ineach region collaborates with Komatsu's manufacturing plants inpromoting activities that take advantage of characteristics of theregion. It also holds regular meetings to promote understandingof Komatsu's businesses and activate communication between
Komatsu's executives and top management of member
companies. Many overseas member companies, as well as thosein Japan, participate in the general meeting, which is held in
November every year. At this meeting, executives of Komatsu givebusiness brie ngs, and explain our global procurement policy andpriority activities. In Japan and China, as a measure to support the
improvement of member companies' competitiveness, theKomatsu Midori-kai divides its members into some groups(subcommittees) based on the items they supply, and promotes
improvement activities in cooperation with Komatsu by selecting
common themes such as safety, the environment and cuttingedge production technology. Information about actual
improvements that have been made is shared by companies in thesame group to promote the hori1ontal spread of information.
* SLQDC: abbreviation for Safety, compliance with the Law, Quality, Delivery and Cost

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Quality of Life

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Theme 2 :Developing
PeopleData

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Activities

Index

Outline of Procurement Policy and Supply Chain

General assembly of Midori-kai in North America

Lecture by President of Procurement Division of Midori-kai in North
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Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Outline of Procurement Policy and Supply Chain

Detail of Critical Suppliers
Number of companies
RegionMidori-kai
membercompanies

Nonmembers ofMidori-kai

Total

Proprietary parts*2

Sub-contracted*1
Total

InvestedbyKomatsuHighlydepend on
business #/t
Komatsu

InvestedbyKomatsuHighlydepend on
business #/t
Komatsu

Big
enterprise

Tradingrm,
Material

Japan

156

7

86

2

7

43

11

China

59

2

33

1

4

14

5

USA

44

1

15

1

19

8

EU

39

30

3

Japan

1

USA

2

Thailand31

Indonesia

4

India

6
1

2
18

10

2

1

2

12

11

1

Vietnam3

2

Philippines

1
352

1

1

1
1

12

172

4

13

117

33

*1 Business partners who manufacture goods based on drawings and/or speci cations from Komatsu (mostly medium and small enterprises)*2 Business partners who manufacture goods based on their own drawings and/or speci cations (mostly major companies)

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PeopleData

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Index

Outline of Procurement Policy and Supply ChainClassi cation of Critical Suppliers
Percentage ofprocurement in monetary
terms

Number and Percentage of Total The numbers of higher-levelcompanies are included in those of lower-level ones.)

Categories
1

All Tier 1 suppliers

2,666

100%

100%

2

Level
3

318

13%

77%

Level
2

201

8%

67%

Level
1

16

1%

8%

3
4

Critical
suppliers

The level of critical suppliers is determined by the degree of Komatsu's involvement in each.
Level 1: Companies in which Komatsu or the Komatsu Group companies have invested
Level 2: Companies in which Komatsu or the Komatsu Group companies have not invested but which are highly dependent on business
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CSR Procurement Guidelines

CSR Procurement Guidelines
Komatsu Group CSR Procurement Guidelines : What we would like to ask
our business partners in the supply chain(Established on August 30, 2011; Revised on April 1, 2019)

1. Operations for Sound Management
1. Build a system or operational structure designed to meet various risks.
2. Establish legal and transparent decision-making processes concerning management.
3. Conduct appropriate accounting procedures, tax ling and settlement of accounts.
4. Place importance on communication with stakeholders (customers, shareholders, business partners, employees, etc.).
5. Ensure that top management will be notied promptly when any abnormal condition develops and that your company will be able
to promptly and accurately respond to the situation(s).
6. Fulll accountability to society through active disclosure of corporate information.

2. Thorough Enforcement of Compliance
1. Engage in business operations while complying with the laws and regulations, as well as the rules of the business community in the
countries and regions where we conduct business operations. In addition, make eorts to respect internationally accepted
standards.
2. Dene a code of conduct, comprising company rules, under the leadership of senior management, and develop a corporate climatethat places top priority on compliance.
3. Establish a compliance regime, in accordance with the scale and characteristics of the company, that prevents the company,
executives, and employees from engaging in illegal conduct, and promptly addresses situations where issues have occurred (e.g. awhistle-blowing system).

3. Product Safety, QCD and Technology Innovation
1. Comply with the laws and regulations concerning product safety and deliver products and services which will oer safety andpeace of mind to customers.
2. In addition to maintaining the quality and cost competitiveness of products and services which your company delivers tocustomers, stand by the agreed upon date of delivery and supply your products in a stable manner.
3. Establish a quality management system and make eorts to maintain and improve it.
4. Constantly engage in technology development and provide innovative, safe and environmental-friendly products and services.

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CSR Procurement Guidelines

4. Considerations for the Environment
1. Continue e orts to reduce environmental impact resulting from business operations.
2. Appropriately manage chemical substances contained in products.
3. Build up environmental management systems such as the ISO14000 series and "Eco Stage."

5. Measures to Respect Human Rights, Appropriate Labor Conditions and Occupational
Safety and Health
1. Respect human rights including the rights to freedom of association and collective bargaining.
2. Never get involved, directly or indirectly, in any child or forced labor.
3. Create a work environment where there is no discrimination or harassment in any aspect of employment.
4. Respect the rights of workers, through payment of fair wages and proper working hours management.
5. Establish a system for occupational labor health and safety, under the leadership of top management, and create a working
environment where all employees can work safely and healthily.
6. Establish fair and equitable human resource system, and pay attention to human resource development and employee education
as well.
7. Give consideration to improving communication between top management and employees.

6. Fair Business Practices
1. Comply with all related laws and regulations and engage in free and fair competition and business transactions.
2. Respect intellectual properties of other parties and work to prevent infringement thereof. Appropriately handle information(including personal information) of your company and other companies.
3. Never accept inappropriate cash, gifts or other favors.
4. Carry out proper foreign trade transactions (goods and technologies) while complying with the related laws and regulations.
5. Never have any relationship with antisocial forces or groups.

7. Social Contributions and Co-existence with the Local Community
1. Engage in social contribution activities based on your company's management principle(s) and support employees' volunteer
activities.
2. Place importance on co-existence with local communities which is the foundation of your business, and proactively support thegrowth of local communities.

8. Spread of the guidelines throughout the Entire Supply Chain
1. Encourage business partners of the company to observe the items stipulated in the guidelines. Make e orts to encourage thespread of these guidelines into the entire supply chain.
* These guidelines will be revised as needed.

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Index

CSR Procurement Guidelines

Komatsu Group's Supply Chain Management and Promotion of CSR
Procurement

1. Promotion System and Human Resource Development in Procurement Departments
Komatsu employs a centralized procurement system where the Procurement Division deals with almost all the components andmaterials used in multiple plants in Japan. For overseas production, A- and B-category components as specied in the component
categories described above are dealt with by the Procurement Division, and the C components are dealt with by the procurement
departments of overseas subsidiaries. In addition, we have established an overseas procurement center within each site in the U.S.,
Europe, China, and Asia to ensure the penetration of the policies of the Procurement Division and ensure the consistency of the
procurement activities of each overseas subsidiary. We are also using this system for global supply chain management and thepromotion of CSR procurement. Furthermore, we hold meetings to exchange information with the procurement departments ofproduction-related group companies on a regular basis to respond to common issues on a group-wide basis.

Categories for the division of roles for procurement departments

Meetings for the exchange of information with group companies

The development of the procurement sta who will be
responsible for CSR procurement is also an important issue. We
have compiled basic matters that purchasing departments must
not forget in promoting global procurement - in particular, thebasic philosophy and code of conduct that should be kept in mind
when working with business partners -- in the KOMATSU Way(Procurement). In addition, we have been facing signicantchanges in laws and regulations of Japan and other countries on
business transactions, employment and labor, environmental
protection, export control and other matters. Responsible persons
from the procurement department are required to understandthese trends and reect them appropriately in their daily
procurement activities. At Komatsu, we strive to inform all
employees of the trends by providing group training and eKOMATSU Way procurement
learning designed for each one of the job classes, from new
employees to managers.

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Quality of Life

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CSR Procurement Guidelines

2. Risk Assessment in the Supply Chain
Procurement from business partners accounts for a substantial percentage of our production costs. It reaches nearly 90% in middlesized hydraulic shovels, a typical piece of construction machinery. Therefore, for the stable continuation of our business activities, it isessential to identify and respond to risks in our supply chain at an early stage. There are a wide range of risks in the supply chain,including the management of business partners, their SLQDC status, natural disasters, international trade conicts, and import/export
regulations. Komatsu visualizes risks through regular risk assessments that we conduct, particularly for critical suppliers, and we arecarrying out activities to reduce those risks.
・List of risk assessments conducted regarding suppliers
Methods of supply chain risk assessment 〇: Subject of the assessment)
GeneralManagement

CSR

Scope

Periodic
Two-wayon
Communication monitoring
Management
through Midori- Financial status&
kai activities (*1)

Frequency

As needed

Method・Lecture &Q&A・Discussion
・Groupactivity

Tier 1
1 Totalsuppliers

-

〇

-

-

Level 〇
3Level
3 Criticalsuppliers 2 〇Level 〇
4
1〇-

〇Quarterly〇Monthly2

Evaluation Monitoringonlevel onSLQDC(*2) ofSafety
Performance activities& Capability

CSR SAQ
Audit onsurvey,Environmental
includingManagement,
monitoring of includingorganization acquisition andforrenewal of EMS
compliance certication

Annually/
Once every
Quarterly/Monthly Annually six months Annually
・Monthly & ・Written
Annualsurvey・Written
performing ・Management survey
・Written survey data・interview ・On-site
Management ・On-site audit
interview audit

BCP
Assessinghow muchisCompliance damage
causedby
Risk (CR) disaster, etc.a
Audit(*3) and whether
supply canbe continued

Annually

2-year cycle As needed・Written survey
・On-site audit

・Written telephone/esurvey
check・On-site mailthrough
audit
supply chain
・Checkdocumented management
evidence system

〇

-

-

〇(*5)

-

〇

〇(a)

-

〇(*5)

〇(*4)

〇

〇

〇(a,b)

-

〇(*5)

〇

〇

〇

〇(a,b)〇〇(*5)*1: In the case of a listed company, nancial reports are reviewed alternatively.
*2: Safety, compliance with the Law, Quality, Delivery and Cost
*3: Finance and accounting, labor management, procurement (the Subcontract Act) and information security*4: Custom goods suppliers only
*5: Plants located in Japan only132

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CSR Procurement Guidelines

To respond to natural disasters which recently have occurred
frequently and become diversied, we have begun to operate a
supply chain management system in Japan linked to disaster
information from the Japan Meteorological Agency. This is aimed
at quickly inspecting damage to our business partners andassessing the impact on our supply chain after a natural disaster,such as an earthquake, tsunami, or typhoon. We have built a
database of locations and production items with over 20,000 sites
managed by 7,662 business partners, including secondary andsubsequent suppliers, thereby visualizing the risks of interruption
in product supply that can be expected to be caused by a disaster.
This enables us to take focused countermeasures promptly. In theevent of a disaster, we rst check the damage to our suppliers at
high risk which have been assessed through the system. Where
Epicenter of the Northern Osaka Earthquake in June 2018 and thenecessary, we dispatch security maintenance personnel to thecompanies to support their activities for the prompt recovery of Cooperative Company Distribution Map
production.
In 2019, our supply chain was greatly impacted by the ooding ofrivers caused by Typhoon Hagibis (No. 19), which damaged
multiple business partners. In light of this, we will link the
Komatsu supply chain management system with the hazard maps
released by the Ministry of Land, Infrastructure, Transport andTourism to understand potential risks in advance.

Disaster recovery support (lending electric generators)

Disaster recovery support(assisting the centering of working machines)

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CSR Procurement Guidelines

River ooding caused by Typhoon Hagibis No. 19

Hazard map and disaster-stricken business partner (in the Chikuma Riverbasin)

3. Awareness Building A tivities to Ensure the Penetration of CSR into the Supply Chain
To raise our business partners' awareness of Komatsu's CSR procurement guidelines, we are carrying out awareness building activities
around Compliance and BCP at the Komatsu Midori-kai meetings and monthly business meeting held in each oce. In addition, the
CSR Report issued for Midori-kai member companies shares CSR-related "Everybody's Compliance" articles which are published for
Komatsu employees, and information regarding the revision of related laws and regulations in Japan and other countries. Starting fromFY2020, to ensure the further penetration of CSR into the supply chain, we began an SAQ survey about CSR activities for our primary
suppliers in Japan and other countries. Based on the standard survey tool released by the Global Compact Network Japan (GCNJ), in
which Komatsu also participates, this survey complements the items Komatsu considers to be important. Initially, the survey will target
156 Midori-kai member companies and then its scope will expand in sequence while following up with our business partners who wewish would raise their awareness of CSR issues.
In line with our corporate social responsibilities, Komatsu does not condone the use of conict materials produced by the Democratic
Republic of Congo (DRC), or its neighbors (Angola, Republic of Burundi, Central African Republic, Republic of the Congo, Rwanda, South
Sudan, Tanzania, Uganda and Zambia). We have informed our business partners of this policy through the Komatsu Green Procurement
Guidelines. Working hand-in-hand with suppliers, we conducted a country-of-origin survey to determine the location of origin of ourmaterials and to ensure that none of them are sourced from areas of conict. Moving forward, we will continue to take steps to enforce
strict adherence to this policy, which will serve to restrict funding for military groups situated in such areas. Any conict materials
discovered to be within our supply chain will be immediately discontinued from use.

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Index

CSR Procurement Guidelines

4. Komatsu's Whistleblowing System for Suppliers
At Komatsu, we launched a whistleblowing system for suppliers in March 2017 to accept whistleblowing reports from suppliers on acts
in procurement activities of the Komatsu Group which are violating or alleged to be violating laws and regulations. Matters reported via
dedicated contacts, which we set up inside and outside the company, are handled by a department in a neutral position. This
department investigates and veri es facts to take corrective measures promptly. We have vowed to ensure that business partners who
have reported will not receive any disadvantageous treatment.
Komatsu's Whistleblowing System for Suppliers(121KB)
Changes in reported cases

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Support for Member Companies of the Komatsu Midori-kai (Management and Society)Support for Member Companies of the Komatsu Midori-kai(Management and Society)
Komatsu supports Midori-Kai member companies in a variety of ways. Main support activities that we have carried out are described
below.

1. Safety
Komatsu provides support for the establishment of systems for safety activities and improvement of the activity level to 99 companies,
the majority of which are custom goods suppliers out of the Midori-kai in Japan. The support includes continuous safety patrols by
specialists from Komatsu, sharing information and hori3ontal application of occupational safety measures conducted by othercompanies, the introduction of management system, and so on. These activities are also carried out at the Midori-kai in China.

(1) Komatsu experts conducting safety patrols
Using check sheets and on-site patrols we conduct surveys to ensure compliance, particularly with laws (e.g. reports and inspections),
unsafe locations on site, and the existence of unsafe actions. If anything problematic is found, we request the submission of acountermeasure report, which describes the measures to prevent recurrence, as a follow-up. In FY2017, we reviewed the check sheetsand evaluation criteria so that we would be able to use the same standards to evaluate the activities of Midori-kai members companywide and follow-up with them to improve the level of each company every year.

(2) Encouraging business partners to implement mutual safety patrols
One of the Midori-kai committee activities is the implementation of mutual safety patrols by business partners with similar businessstandpoints. We also put a lot of weight on inspecting from perspectives speci c to each business category (e.g. the handling of heavy
goods or the risks of touching hot surfaces).

(3) Connecting and information sharing through safety activities in Komatsu
Executives from the Midori-kai member companies in Japan participate in the Komatsu Group Safety and Health Conference, which isheld in June every year. Excellent Zero Accident circles provide presentations about their activities. In addition, we open the Safety
Dojo (Safety Training Hall), a facility included in each Komatsu plant, to our business partners, aiming to improve the safety awarenessof the employees of each company through danger simulation experiences and danger prediction training.

(4) Focused guidance for companies with repeated accidents
We select companies that have had repeated accidents as target companies for Special Safety Activities and provide special support
and guidance according to the unique situation of each company.

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Support for Member Companies of the Komatsu Midori-kai (Management and Society)(5) Introducing labor safety and health management systems
To increase the level of the activities at each company, we support them in their establishment of their own occupational safety andhealth management systems, including OSHMS certi cation. In 2015, we supported 97 companies that implemented Japan Industrial
Safety and Health Association (JISHA)'s Workplace Safety Health Impact Project for small and medium-si-ed businesses, and they areusing the project to objectively evaluate their own activities.

Risk assessment training

Group performing a mutual safety patrol

Presentation by Sekigahara factory
at a Komatsu safety meeting

Changes in the results of safety activity evaluations in 2018 and 2019 (99 Midori-kai member companies, 116 o ces)

Changes in the number of accidents at Midori-kai member companies in Japan and China Table 1

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Support for Member Companies of the Komatsu Midori-kai (Management and Society)2. Compliance
We conduct compliance and risk audits (CR audits) internally. In 2016, we began to conduct the CR audits even for 16 business partners
in which we have made minority investments. The audit is conducted in four elds -- accounting, labor management, procurement (theSubcontract Act) and information security. It is aimed at identifying potential risks and taking corrective measures at an early stage. The
risks are identi ed mainly by checking the status of compliance with relevant laws and regulations, con rming business rules,
segregation of business and decision-making authorities, inspecting relevant business documents and conducting on-siteexaminations.
Voluntary establishment of compliance systems by business partners is essential for promoting CSR procurement. We believe that sucha system should desirably be established by 1) formulating rules (establishing codes of conduct of each company), 2) building a
structure for promoting CSR procurement (including the appointment of a person in charge and promoters), 3) introducing awhistleblowing system, and then 4) providing employees with awareness training. Under this policy, we provided support to 99
companies, mainly custom goods suppliers belonging to the Midori-kai, for their establishment of compliance systems by providing
practical examples at Komatsu and employee training materials, etc. We have completed support activities for 37 companies as of
FY2019, and plan to complete them at all of the companies by the end of FY2021. While taking the laws, regulations and practices ofeach region into consideration, we will expand these activities to the other countries around the world.

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Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Support for Member Companies of the Komatsu Midori-kai (Management and Society)

Main Findings through CR Audits (2016 to 2019):
Field

Findings

Countermeasures-Business ow, operating procedures and decision-making
authorities have yet to be set/ are insucient.
-Physical inventory check is not conducted/ not regularly conducted.
Accounting-Rules on sale and disposal of stagnant assets and loss on forced
write-down of such assets are not clear.

Formulation/ review of business ow/
operating procedure, provision of
instructions on physical inventory
check, and others-Management of corporate seals and password updates for theaccounting system are not done thoroughly.
Labormanagement

Error in the service contracts for individual forepersons

Switching to direct employment,
review of timecard operations, etc.

Handling of the fraction (less than 30 min.) at working hour
management-Insucient details provided on the order form (document set forthin Article 3)-There is a risk of delay in payment (within 60 days after receipt).

Procurement(theSubcontract
Act)

Review of order form and supporting
documentation, review of businessow, and others

There is a risk of early deduction of the price of raw materials
purchased by a subcontractor from the subcontract proceeds to be
paid.
-Violation of the provisions prohibiting reduction of subcontract
proceeds (Reducing the amount of subcontract proceeds by theamount equivalent to that of discount commission where thepayment is made in cash)

Support Activities for the Establishment of a Compliance System The number in () indicates the cumulative number of companies.
Achivement

FY

Number of companies wesupportPlan

Target

2018

2019

2020

2021

Japan

5

32
(37)

31
(68)

31 (99)Overseas－－－

Reviewing policies and implementation
methods

99

The CSR SAQ survey is conducted for major manufacturers to understand the status of their operations

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Support for Member Companies of the Komatsu Midori-kai (Management and Society)

Changes in Evaluation Level in CR Audits (from 2016 to 2019):

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Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Support for Member Companies of the Komatsu Midori-kai (Management and Society)3. Personnel Development
We believe that the greatest support that we can provide to the Midori-kai is human resource development. Based on this belief, we
provide various job-level training programs as listed below. In recent years, we are particularly committed to Management Salons andskills transfer activities. Management Salons are aimed at developing young individuals in management positions, who have recently
taken on new business responsibilities. Through these events, Komatsu executives analyze the current strengths and weaknesses ofeach company and exchange views on the medium-term management visions of the companies with their counterparts to align andshare management policies and ideas. The skills transfer activities are aimed at facilitating the improvement and succession of the onsite skills of each company. In these activities, we help each company build systems for promoting skills transfer and skills evaluationand develop instructors in core skill elds by disseminating our own knowledge and skills.
Training Programs for Midori-kai Member Companies
Target job level

Management

Employees inmanagerial
positions

ProgramOutlineMajora hievements

Commissioned
training

Komatsu accepts sons and daughters of corporate managers ofmember companies and provides them with on-the-job training
for up to ve years.

49 trainees
have been
acceptedsince 1972.

Middlemanagement
training

Komatsu's training program for its executive candidates is open to
candidates for member company successor. Duration of the
training is seven months.

25 people
have
participatedsince 2005.

Management
SalonsYoung corporate managers of member companies makepresentations on medium-term management visions of theirrespective companies, which are discussed and shared with
Komatsu.

Provided to a
total of 22
companies
since 2014

Managerial training

For newly appointed managers and on-site job leaders (e.g.
general managers of centers and team leaders)Around 40
peopleparticipate
every year.

Leader training (foreld managers)

Exclusive training programs for the Midori-kai. The training isprovided two times a year.

Around 60
peopleparticipate
every year.

Komatsu TechnicalInstitute

Intended for leader candidates related to production engineeringand manufacturing who are aged 30 or younger. It is a boarding
school which provides a two-year program.

25 people
have enteredsince 2008.

Productionengineer training

It is an exclusive training program for the Midori-kai on sheet metal
processing and mechanical engineering. Five-day training isprovided once a year.

Around 40
peopleparticipate
every year.

Representatives

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Theme 2 :Developing
PeopleData

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Activities

Index

Support for Member Companies of the Komatsu Midori-kai (Management and Society)Target job level

ProgramOutlineMajora hievements

Instructor training

A 30-day program for candidates for skilled instructors of eachcompany

84 people
have
participatedsince 2015.

Inspection training
schoolInspection skills training and classroom lectures

All Komatsu QC
competition

Participants are selected from among the Midori-kai members.

All Komatsu skills
competition(Advanced
Techni#ue Contest)

Participants are selected from among the Midori-kai members.

Skilled workers

OthersAround 20
companies
participate
every year.

Instructor training

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Support for Member Companies of the Komatsu Midori-kai (Management and Society)

4. Supporting Productivity Improvement Activities by Using ICT
Addressing the issue of the labor shortage, which has been growing more seriously in recent years, is an urgent task for Komatsu andmembers of the Midori-kai as well. We promote the networking of production sites and facilities by making e ective use of ICT (KOMMICS) and using the network to improve productivity and save human resources. As a countermeasure against the labor shortage, weare expanding these activities to members of the Midori-kai proactively. Tools such as ones for monitoring operating rates that wedeveloped on our own (K-MICS PAD) automatically collect data, including operational status and operating conditions, from thecontrollers of machine tools and welding robots of each company. These data are accumulated on the network, and processed andedited on a PC with application prepared for each purpose. We thus visuali%e the issues that need to be overcome to improve theoperating rate, leading to collaborative analysis and implementation of measures.
Outline of KOM-MICS

Changes in the number of K-MICS PAD units installed143

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Support for Member Companies of the Komatsu Midori-kai (Management and Society)5. BCP to Prepare for Natural Disasters
With so many natural disasters, such as earthquakes, heavy rains, and typhoons, in 2018 and 2019, the importance of establishing a
BCP system for the supply chain has been rediscovered. Starting after the Great East Japan Earthquake in 2011, Komatsu has
implemented measures to withstand earthquakes and water damage, etc. at the buildings and facilities of 104 companies, mainly
custom goods suppliers belonging to the Midori/kai. In addition to these tangible measures, it is also necessary to strengthen
intangible measures, including the establishment of an initial response system by creating a BCP manual, etc., ensuring its workability
through education and simulation exercises, and preventive measures for business restoration in the future. Since FY2019, we haveheld BCP workshops for 104 Midori/kai member companies, mainly focusing on support for the establishment of their own initial
response systems.

BCP workshops

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Suppot for Midori-kai member companies (Environment)

Our Suppot for Midori-kai member companies（Environment）
1. Green Procurement Guidelines
Komatsu established the Komatsu Earth Environment Charter in 1992 and declared that they would engage in environmentallyconscious business activities to reali+e a sustainable society. However, social demand for the reduction of environmental burdens andresponses to climate change is increasing. Considering this background, Komatsu has established and released the Green Procurement
Guidelines, which supplement the environment-related issues described in the CSR Procurement Guidelines. By using these guidelines,
we preferentially promote green procurement, which is conscious about the environment, and of the raw materials and procured
components/parts, which are important elements in our production. It also prompts business partners to develop their own
environmental management activities.
Komatsu Green Procurement Guidelines(396KB)

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Our Suppot for Midori-kai member companies (Environment)

2. Support for Those Obtaining Environmental Management
Certi cations
We have requested all member companies of the Midori-kai in Japan and China to obtain certications for environmental management systems(EMS), such as ISO14001 and Eco-Stage, and provided them with instructions and support for obtaining the certications. In Japan, all 156
member companies have obtained the certications, and we began to check the renewal status of the certications in 2018. In China, 57 out of
the 59 applicable companies have already obtained the certications, and we expect that all the companies will obtain them by the end of
FY2020. We are promoting the suppliers in U.S., Europe, and Asia that are among our 352 level-3 critical suppliers to obtain similar certications,aiming to reach an 86% certication rate by the end of FY2022 (all the companies that perform manufacturing, excluding trade companies, aretargeted).
Over ten years have already passed since the Midori-kai members in Japan obtained the certications. Like in the case of the safety and healthactivities, it is important to follow-up the status of the certications in each company's business activities. To realize this, we will startenvironmental audits, which we have conducted internally, mainly for the outsourcing companies of the Midori-kai from 2020. Through written
surveys on compliance with environment-related laws and regulations, etc. and on-site inspections at each company's oces, we will inspect
how EMS has taken root on site and link the results to our support for their improvement in the future.

Environmental audits

Number of Midori-kai Member Companies with EMS Certi cations (as of the end of April 2020）
RegionNumber of member
companies

Number of companies !hich ha e obtained
certi cation

Percentage of companies !ithcerti cation

FY2017FY2018FY2019Progress

Japan

156

156

156

156

100%

China

59

53

55

57

97%

North
America

44

19

19

19

43%

Europe

39

29

29

32

82%

146

Target100%

86%

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Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Suppot for Midori-kai member companies (Environment)

3. Responding to Climate Change: Greenhouse Gas Reduction in the
Supply Chain
In 2012, we began activities to reduce the power consumption of 96 Midori-kai members in Japan by setting a target reduction inelectricity consumption of at least 15% compared to 2010. This target was achieved in FY2016, with an average reduction of 20%. As aresult of the expansion of these activities thoroughly across all our suppliers, some suppliers have won the ECCJ Energy Conservation
Grand Pri1e Award. Since 2017, we have worked to maintain the reduction level through independent improvements at each company.
In the second half of FY2019, we set a target of reducing greenhouse gas emissions from all kinds of energy, including heavy oil, gas andelectric power, by 15% (by the end of FY2024, compared to 2010). As a rst step, we conducted a fact- nding survey of ten casting andforging companies and heat treatment companies, which emit large amounts of greenhouse gases, and began to provide them withinformation about the improvements that we had actually made. While providing concrete support to help these 10 companies toimprove, we will also request that the 201 suppliers that fall under our Critical Suppliers-Level 2 set self-reduction targets in sequenceand take tangible measures to reach those goals.
Independent Practitioner's Assurance
Changes in electric power consumption(Midori-kai 93
companies)

Corrected index of manufacturing index is not covered by independentpractitioner's assurance.

Change in CO2 emissions(Midori-kai 93 companies)

Corrected index of manufacturing index is not covered by independentpractitioner's assurance.

Results of activities in Japan for reducing power consumption
from 2012 to 2016 (reduction of electric power consumption
rate calculated against the 2010 base unit)

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Suppot for Midori-kai member companies (Environment)

4. Addressing Water Risks
We are inspecting 135 oces of 96 Midori-kai members in Japan to understand their general water risks, including the abovementioned heavy rain and tsunami risks, locations, potential and actual water intake/discharge capacities, water quality, and how they
address these issues. We also use Aqueduct in these analyses.
In response to these investigations, we have been conducting activities to reduce water consumption since FY2017. Establishing thecompanies that are the top ten users of large amounts of clean water as model companies, we are performing these activities byintroducing Komatsu improvement examples and the providing guidance on improvement through on-site visits while setting a water
reduction target of 15% by FY2021.
Changes in clean water usage by the top 10 Midori-kai
copanies

On-site investigation of water risks

5. Responding to Environmental Regulations in China
The basic goal of the environmental regulations in China is the elimination of three
things: exhaust gases, discharged water, and solid waste. However, when operating underthose regulations, the regulations and standards set forth by each local government havepriority. Regarding discharged water from plants, to address the aggravated waterpollution in rivers and lakes, the standards for BOD/COD (Biochemical Oxygen
Demand/Chemical Oxygen Demand), which are indexes of amounts of organic substancesin discharged water, are especially strict when compared to the country-wide standards inJapan, and there is an increasing number of cases where centrali:ed water treatment
systems for discharged water, etc. need to be installed.
Komatsu checks the regulatory compliance status of the Midori-kai members in China ona regular basis.

An example of measures to meet regulations in
China (Daikyo Machinery Shandong Co., Ltd.:Installation of a welding fume dust collector andexhaust air ducts)

In addition, in China, extremely tough environmental regulations were imposed in 2015,
mainly in the coastal areas, aiming to improve air pollution issues (PM2.5) drastically. As aresult, companies engaging in businesses such as painting, welding, casting and plating
are required to take thorough measures to reduce exhaust air, smoke and soot (including
VOCs). Working together with member companies of the Midori-kai in China, we provide
support for complying with the regulations, including the installation of facilities. As aresult of measures taken by the companies, 14 companies had been certied as exempt
from the regulations (as green companies) as of March 31, 2019. We will continue to workwith each company to reduce risks to our business continuity.

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Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Suppot for Midori-kai member companies (Environment)

6. Dealing with Biodiversity
In 2011, Komatsu established “the Declaration of Biodiversity by Komatsu”, a declarationthat we will work for the reduction of environmental impact through our businessactivities and for the conservation of biodiversity through our social contribution
activities. Receiving support for our policies from Midori+kai members in Japan and othercountries, we are conducting community contribution activities in cooperation withthem, such as environmental conservation.
Cherry tree planting activity in China (Jining,
Shandong Province)

Support for construction and environmental conservation of the Yusen-ji copper mine in Komatsu,
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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Our Suppot for Midori-kai member companies (Environment)

The following explains our major support activities for the Midori-kai member companies in FY2019.
Field
Content
Result in 019

SafetyEnvironment

Education

Productivity
improvement
BCP

Safety patrols

101 companies in Japan and 35
companies in China

Subcommittee members’ mutual safety patrols

60 companies in Japan and 35
companies in China

Risk assessment training

Total of 15 times for 12 companies

Participation in Komatsu safety and health meetings

101 companies

Reporting of safety activities at Komatsu safety and healthmeetings

5 companies in Japan and 1
company in China

Environmental surveys (status of compliance with laws andregulations, and on-site checks)

4 companies

CO2 reduction workshops

10 companies

Activities for reducing water consumption

10 companies

Participation in middle management training

2 participants from 2 companies

Participation in Midori-kai managerial training

31 participants from 19 companies

Participation in Midori-kai leader training

68 participants from 34 companies

Participation in Midori-kai production engineer training

29 participants from 25 companies

People enrolled in the Komatsu Technical Institute3 people from 3 companies

Participation in instructor training

15 participants from 10 companies

Participation in all Komatsu QC competition

7 companies

Participation in all Komatsu skills competition (Advanced
Techni0ue Contest)

28 participants from 18 companies

Number of K-MICS PAD units mounted on the machine tools ofMidori-kai member companies

Total: 945 units

Number of welding robots at Midori-kai member companies
that are connected to KOM-MICS

Total: 178 units in Japan and 98
units overseas

BCP workshops (3 venues)

143 participants from 98
companies

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Our Suppot for Midori-kai member companies (Environment)

ComplianceInternal AwarenessRaising Initiatives

OthersCompliance and risk audits

8 companies

Support for the establishment of compliance systems

32 companies

Check of the residency statuses of foreign workers

1,782 people at 97 companies

Training for updating knowledge about the Subcontract Act(e-learning)

Participation in Midori-kai general meetings withmanagement151

100 participants from theProcurement Division
618 participants from related
divisions and companies
351 participants from 155
companies in Japan
74 participants from 39 companies
overseas

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Theme 2 :Developing
PeopleData

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Safety and environmental initiatives at sales and service companies

Safety and environmental initiatives at sales and service
companies
Support for Sales and Service Divisions in Developing Environmental
Management Systems
Komatsu also continues to be committed to safety and the environment in the sales activities of Komatsu Group construction
machinery and forklift distributors and rental companies. To raise awareness about environmental management, in FY2019 wedeveloped environment management systems and supported improvements mainly at our site workplaces.
Item

FY2018CO2（kt-CO2）

FY2019
8.05

Year-on-year
7.45

7.5％ reduction

Acquisition of ISO14001 Certi cation
Komatsu Customer Support Co., Ltd. (“KCSJ”), was established in April 2018 to carry out activities to acquire ISO 14001 certication, aninternational standard, as part of their eorts to establish an integrated environmental management system. With the construction
machinery, rental, and lift divisions of seven companies being consolidated, all companies, including the Head Oce, engaged in astandardi5ed eort for environmental improvement and successively acquired certication as planned.

Activities Based on the Environmental Guidelines
We distribute our "Environmental Guidelines" to all of our sales sites, and follow theguidelines in pushing forward with our environmental activities. The guidelines
summari5e the rules and standards that should be observed at the workplaces of oursales and rental companies in compliance with the law and also to avoid negatively
impacting neighbors in terms of waste disposal, wastewater treatment, control of noiseand vibration and other problems deeply related to the environment. Representatives ofKomatsu and a relevant company jointly visit our sites, provide guidance to on-site
workers and develop proposals for improvement so that the environmental guidelines
can be consistently complied with.

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Water Quality Testing in Oily Water Separation
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Theme 2 :Developing
PeopleData

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Activities

Index

Safety and environmental initiatives at sales and service companies

Proper Discharge of Waste
The waste management system (which centrali+es the management of electronic manifests, consignment contracts, permits andothers) that had already been introduced in our construction machinery sales division has also been introduced in the rental and lift
divisions of all KCSJ companies, which has enabled all the divisions to centrally manage waste.

Reduction of Environmental Impact in Our Regular Operations- Supporting the sale of environmentally friendly products -Along with the expansion of the lineups of eco-friendly machines developed by Komatsu,
such as machines equipped with Tier 4 Final which satises emission regulations, ICT
construction machines, and battery forklifts, we proactively focused on the promotion ofsales and aim to reduce environmental impact through our operations (sales and service).
In addition, the Komatsu Group distributors also focus on SMART CONSTRUCTION using
ICT construction machines and aim to reduce environmental impact through the
improvement of the eciency of on-site work, etc. Especially, KCSJ locates IOT centersaround the country for many users to visit and experience smart construction methods
with the use of ICT construction equipment. In this way, we endeavor to enhance
A demonstration held at an IOT center
understanding about construction methods that minimi+e environmental impact andspread these methods.

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Theme 2 :Developing
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Index

Environmental Risk Management

Environmental Risk Management
Promoting Legal Compliance, and Pollution Mitigation and Prevention
Komatsu complies with national and local laws and regulations and ensures that it periodically reports and maintains measurement
results.
In FY2019, there were two violations and one violation of environmental regulations in Japan and other countries, respectively, each ofthem minor. No nes are imposed and they have all been resolved.
There were no major environmental accidents which might pollute the environment on the boundary of our site during this period.

Addressing Soil and Groundwater Contamination
Komatsu has established guidelines for testing soil and groundwater, inspects any business unit that is scheduled to be sold, closed, or
removed pursuant to laws and regulations, and takes purication measures upon conrmation by local authorities if contamination is
discovered.
We voluntarily investigate business units in operation in order to test for contamination stemming from VOCs in cleaning solvents, etc.
used in the past.
We have been surveying soil and groundwater for VOC contamination at domestic business units since 2005, and have implemented
countermeasures at any sites that have been found to be contaminated. We use methods that facilitate the cleaning process in the
shortest period of time possible.
Our clean-up of the Oyama Plant was completed in FY2009. We are continuing clean-up operations at other sites while checking theeect of our cleaning measures.
We will continue to thoroughly clean-up and regularly monitor groundwater at site boundaries to ensure that there is no outow ofgroundwater that has exceeded the standard outside the premises.

Status of Soil and Groundwater Cleanup in Japan
Business unit

Cleanup ethod

Cleanup status

Awazu Plant

Excavation and removal, soil vapor extraction,
groundwater withdrawal and aeration,bioremediation

In process

Komatsu Plant(former site)

Excavation and removal, groundwater
withdrawal and aeration, bioremediation

In process

Osaka Plant

Soil vapor extraction, air sparging, groundwater
withdrawal and aeration, bioremediation

In process

Shonan Plant

Excavation and removal, groundwater
withdrawal and aeration

In process

Tochigi Plant

Excavation and removal, bioremediation

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Environmental Risk Management*1 Bio-remediation is a purication process whereby hazardous materials are puried using micro- organisms. This return the soil to a non-hazardous
state.
* Investigative surveys revealed zero contamination in the Koriyama Plant, Technology Innovation Center in Hiratsuka, Techno Center in Izu and Field
Testing Department in Oita.

Managing PCB (Polychlorinated Biphenyl) Waste
Komatsu stores and disposes of PCB-containing waste (such as transformers and uorescent stabilizers) in accordance with the "Act on
Special Measures concerning Promotion of Proper Treatment of PCB Wastes" and the "Waste Management and Public Cleansing Law".
We intend to continue our appropriate treatment of PCB waste, including low-concentration PCB waste, according to our plan.

Management of Chemical Substances and Pollution Prevention
Reducing the amount of PRTR-related substances

In FY2019, the number of PRTR* substances with a handling volume of 1 ton or more (0.5 tons or more for Class I Designated Chemical
Substances) was 26, a reduction by one, compared to the previous year.
The PRTR substances xylene, ethyl benzene and toluene account for approximately 91% of the emissions from Komatsu and KomatsuGroup production sites. Most of these emissions are released into the atmosphere.
In FY2019, the volume of xylene, ethyl benzene and toluene fell from FY2018 levels despite increased production volume due to theongoing switch to paints and thinners that contains less PRTR Class 1 substances at each site.
We will continue to make eorts to switch to paints that contains less PRTR Class 1 substances, introduce high solids thinners andpaints, improve coating eciency, reduce coating lm thickness, and recycle paint thinner. Emissions in FY2019 were reduced by about
12% from the previous year.
* PRTR: Law designed to mandate the disclosure of the amount of specic chemical substances released into the environment to promote themanagement of such substances (The notication system based on the PRTR Law)

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Breakdown of the Amount of PRTR-related Substances Released and Transferred from
Komatsu Group Manufacturing Facilities in Japan
Independent Practitioner's Assurance

Komatsu Group Manufacturing Facilities in Japan* Totals may not match exactly due to rounded decimals in individual categories.

Amount of PRTR-related Substances Released into the atmosphere
Independent Practitioner's Assurance

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Reducing VOC Emissions
The majority of VOC emissions are from VOCs contained in paint such as xylene and ethyl benzene.
Emissions in FY2019 were reduced by 6.5% compared to the previous year, and we have managed to maintain a 50% reduction(compared to FY2005) in the amount of VOC emissions per unit of manufacturing value.

Amount of VOC Released
Independent Practitioner's Assurance

Komatsu Group Manufacturing Facilities in Japan

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Reducing the amount of coating used by automating coating lines for large parts
At the Awazu Plant, large frames were coated by hand in the past. They have started coating them on an automated coating line, which
has reduced coating material consumption drastically.
Automation had been dicult because dierent large parts are attached for each customer, requiring the coating to be appropriate foreach shape, and also because seasonal changes in temperature made it dicult to adjust the coating conditions. To introduce the new
equipment, we performed several improvements. First, we installed a booth to pre-heat parts to adjust to the temperature changes. We
also started controlling the temperature of the coating materials. Second, we placed the robot so it would be able to always coat fromthe same direction by rotating the part being coated, etc. Those improvements enabled us to introduce the automated coating line.
In the past, humans would accidentally recoat areas, which makes the coating lm thicker. The introduced robot can consistently spray
the same amount of coating, which has realized a constant coating thickness, preventing the waste of the sprayed coatings.
Consumption of coating was reduced 47% after the introduction of the robot. Moreover, the automated line also reduced the amount of
coating adhering to the walls of the coating booth, improving cleaning and maintenance as well.

Frame coating with the coating robot

Reducing the Use of Substances of Environmental Concern andComplying with the EU REACH Regulation
Komatsu is aware of the harmful environmental impacts that certain materials possess, and has made continuous eorts from an earlystage to reduce the use of a number of such substances. These included asbestos, lead, and other such items. In FY1999, we created ourown list of banned and limited-use substances (Refer to “Substances of Environmental Concern Banned or to Be Reduced for Use in
Products”), which was based in part on Japanese legislation (Japanese Law Concerning the Examination and Regulation of
Manufacture of Chemical Substances Control) that banned a number of chemical materials as well as regulatory measures in othercountries.
We have also implemented more stringent measures in the control of substances that raise environmental concerns. In compliancewith REACH*1, we began revisions of our FY1999 listing of banned and limited-use substances. We have also collaborated with suppliers
to create a regulatory system that strengthens control of potentially harmful materials being used for production. We have rolled thissystem out in Japan and Europe, with plans to continue implementation in other areas of operation.
Through the use of this system, we identify SVHC (substances of very high concern) in not only vehicles for export to the EU or produced
at local EU companies, but also in vehicles currently in production and in newly developed vehicles. Furthermore, we also regularly
check for new SVHCs to be added to the list.
There are currently 205 SVHCs registered, with the list being revised every six months. We expect this number to increase to about 1,500
in the future. We have also devised a workow to monitor control of these substances.

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Environmental Risk Management

Control System for Substances of Environmental Concern

Substances of Environmental Concern that are Banned, or are to see Reduced Use in
Production
Rank

NumberChemica Substance
Hexavalent Chromium
PBB/PBDE/HBCDD *3

BannedTo be reduced(Subject tolimited use)

17

15

PCB

Cadmium
Tri-substituted
Organostannic
Compounds
Asbestos

Mercury
Sulfur Hexauoride *3
Specied
CFCs/Alternative CFCs
(HCFC)
Hexachlorobenzene

Trichloroethylene
PFOS (Peruorooctane
sulfonate)

Triethanolamine
RCF (Fire-ResistantCeramic Fibers) (Alumina
and Scilica Types) *3

Lead
Alternative CFCs (HFC)

Arsenic
Specied phthalate ester(DEHP/DBP/BBP/DIBP) *2
MethanolSelenium
Specied Chlorinated
Flame Retardents (TCEP)
DZ

DOTE

UV327

Polycyclic Aromatic
Hydrocarbons (PAH)
BNST

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Rank
Substances ofVery High
Concern(SVHC) under
EU REACH
Regulations
*1
*2
*3
*4

Number(205)*4

Chemica Substance
Komatsu controls the use of the following substances, which might be used in Komatsu
products.
DEHP/DBP/BBP/DIBP etc HBCDD/DBDE/
RCF(5 substances)
Trisphosphates(2-Chloroethyl)Specied Lead
DOTE
UV327
Compounds(4 substances)

REACH: EU regulations for the Registration, Evaluation, Authorization and Restriction of Chemicals
Diethylhexyl phthalate, dibutyl phthalate, benzyl butyl phthalate, diisobutyl phthalate
Review for stricter limits due to regulatory trends.
The number of substances registered up until May, 2020 (progressively updated). Includes materials that are not contained in Komatsu construction
equipment.

NOx and PM Emitted from Products
To reduce the NOx (nitrogen oxide) and PM (particulate matter) contained in the exhaust gases of diesel engines, which are used inconstruction equipment and other machinery, new emission control regulations have been established, and we have been developing
products that emit cleaner exhaust gasses. As a result, the average NOx and PM emitted by the construction equipment products
produced by Komatsu are decreasing as shown below:
Independent Practitioner's Assurance

Komatsu's E orts Regarding Water
Due to climate change caused by global warming and other factors such as population growth, water-related risks such as ooding,droughts, and water shortages have surfaced and are becoming more serious every year.
The Komatsu Group respects the right to water and sanitation as important human rights. We also fully understands that we depend onthat water and our business operations are inuenced by and exert inuence on the quantity and quality of that water. Therefore,
through environmentally considered production activities, the provision of superior products and services, and appropriate actions to
mitigate water-related risks, we conserve water resources and preserve the safety of water in the regions we operate within. It is ourgoal to promote these activities at All Komatsu and lead to the conservation of the global environment.

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Basic Initiatives
1. In our production activities, to reduce water consumption in cleaning and other processes, we set objectives and are continually
carrying out water reduction activities. In addition, we promote the introduction of water circulation systems that collect usedwater for recycling at selected bases to increase the eciency of water use. When returning the water discharged from production
and sales bases to nature, we dispose of it in compliance with national and regional laws and regulations and also the
management standards we have established.
2. Using construction machines equipped with ICT and other advanced technologies, we contribute to measures mitigating waterrelated risks such as safe and ecient shore protection work and disaster-relief work.
3. We regularly carry out water-related risk surveys at our production bases, sales bases, and suppliers and take appropriate
measures to mitigate risk.
4. We provide quality drinking water and sanitary services to those involved in our business, including the local community.
5. We learn about water together with stakeholders to raise our awareness of water and our responsibilities and aim to reali1e bettera society of coexistence and cooperation.
6. We carry out water-related initiatives and proactively disclose achievements.
Through these initiatives, we contribute to the SDGs, a set of common goals for the world.

Actions A ainst Water-related Risks- Based on the Komatsu Earth Environment Charter, the Komatsu Group has promoted the reduction of water usage and recycling andhas carried out activities, mainly for the protection of water quality. In FY2015, we conducted a Water-related Risk Survey at the mainoces in Japan and other countries for the rst time. In this survey, we assessed the risk occurrence percentage, the diculty of
responses, and the magnitude of the impact of seven water-related risk items, including heavy rains, ooding, and pollution fromdrainage, and identied water risks specic to each site.
In addition, using WRI Aqueduct to complement the survey results, we implemented more accurate water-related risk assessment.
As a result of the water-related risk survey, we specied that the Komatsu Group was vulnerable to the following water risks as a whole:
1. The eect of heavy rains on operations and businesses
2. The risk of pollution from drainage
3. The eect of river ooding on the supply chain
To minimi1e the impact of these water-related issues on the businesses of the group, we are promoting water-related risk reduction
activities. In the future, we will implement the water-related risk survey on a regular basis to update the water-related issues of theKomatsu Group.

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Water stress risk survey by area (FY2019)
Using WRI Aqueduct, we surveyed 34 main production bases of the Komatsu Group about water stress risks in the water resource usage
required for their production activities, such as clean water (tap water/city water), industrial water (clean water for industrial use), andwell water. Water usage in areas that were assessed to have extremely high water stress accounts for 10% of overall usage. In addition,
we found that approximately 70% of water used by Komatsu was well water while 75% of water used in high-risk areas was clean waterand recogni0ed that water usage reduction and water recycling were important to secure water resources in each area.

We will eectively use these survey results for activities we have conventionally engaged in, such as the promotion of water usage(input volume) reduction and recycling, aiming to reduce the water-related risks the Komatsu Group is exposed to. In addition, whenplanning the construction of a new business base or the transfer of a base, we will survey water stress in that area to identify the risk
level.

Domestic Case Studies (Oyama and Tochigi Plants)
We have initiated the construction of multiple safety measures against the risks imposed by heavy rain. These include the building of
three reservoirs (capable of holding up to an hour's worth of 100mm/h rainfall), installation of heavy rainfall water pipes, theconstruction of underground reservoirs, and the widening of rainwater drainage ways. In addition to this, we have installed water block
walls and stop bars to prevent water from owing outside of the premises.
* Our reservoirs also serve to alleviate the surrounding district's lack of drainage capacity.
Current Status of Reservoirs:
1. Oyama Plant 20,000 ton 10,000 ton and 4,000 ton reservoirs (completed)
2. Tochigi Plant 12,000 ton reservoir (under construction)

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International Case Studies (KI: Komatsu Indonesia)
The following measures have been implemented to prevent the entry of river ood water into KI premises.
1. Installation of concrete wall
2. Installation of emergency door for employees
3. Installation of oodgate
4. Installation of new drainage system
5. Installation of drainage gate
6. Installation of pump for oods
We have engaged elements of our supply chain to collaborate with our water-related risk initiatives. Our “Water-Related Risk Survey”
was conducted at the operations of one of our main supply chain companies (Midori-kai). Komatsu is proud to report that as of FY2017,
Midori-kai has begun collaborative eorts in our “Water-Related Risk Reduction Activities”.

Compliance and Risk Audit at overseas group companies
Komatsu has been conducting planned compliance and risk audits (CR audits) since scal 2007 for risk prevention at overseas groupcompanies.

Environmental Audits at Overseas Subsidiaries in China and the United States

Audit at Hensley

Meeting at KMC

In FY2019, we conducted environmental CR audits in China (KCCM) and the United States (KMC, Hensley).
Our comprehensive auditing procedure begins with the assessment of a check sheet that our group companies. We then begin an audit
of environmental activities and compliance to legislative regulations, supported by the chief of environmental matters of our main
domestic plant. There were no major problems that would lead to environmental risks in both China and the United States, and bothwere actively working on reducing environmental impact.
We continue to carry out follow-ups checks at areas where audits have already been completed, and plan to conduct further
environmental audits of our group companies in other regions.

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Environmental Risk Management

Past Environment Audits
Year

Area

Year

Area

2007

China

2014

United States and Brazil

2008

—

2015

Thailand2009

Thailand and Indonesia

2016

India and Indonesia

2010

India

2017

Russia and China

2011

Brazil2018

Indonesia and Brazil

2012

Russia and Czech Republic

2019

China and the United States

2013

United State

Holding Regional Environment Meetings
At overseas business units, employees in charge of the environment and safety in each region gathered to hold meetings. By
exchanging information of and discussing common issues in the region, they aim to improve compliance and the level of theenvironmental impact reduction activities at each business unit. In FY2019, 30 or more business units participated in the meetings fromthe following ve regions: Russia, Middle and South America, Europe, China, and North America. Through activities li&e this, we would
li&e to further revitalize the environmental activities of the Komatsu Group.

North American Regional Meeting

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Biodiversity

Biodiversity
Recognizing the potential impact of our business activities on our ecosystem, we have taken steps tomaintaining our commitment to protect biodiversity in our areas of operation.

Initiatives that Deal with Biodiversity
With the establishment of Komatsu's "Declaration of Biodiversity" and "Biodiversity Guideline" in January 2011, Komatsu business
units worldwide began activities designed to preserve biodiversity.
Komatsu promotes initiatives to preserve biodiversity on two levels.
First, the Company continues to promote ongoing eorts to reduce the environmental impact of Komatsu's business activities.
Komatsu also considers biodiversity when deciding how land is to be used, such as when building factories.
Second, Komatsu is becoming directly involved in the preservation of biodiversity, and at the same time expanding our "one-site, onetheme activities" to raise employee's awareness of the need to preserve local ecosystems.

Declaration of Biodiversity by Komatsu
Komatsu recognizes that its business activities are dependent on and inuence benets from the ecosystem through its
biodiversity.
Based on this understanding, Komatsu strives to take actions in accordance with the policies described below, as it shares asense of responsibility regarding the biodiversity crisis, and strives to conserve diverse resources.
(Recognition by Management)
Komatsu recognizes that conservation and promulgation of biodiversity are important management tasks.
Ⅰ(Initiatives)
Komatsu shall promote biodiversity through the following two perspectives.
1. Komatsu shall reduce its environmental impact, which is aecting biodiversity, through its business activities.
Ⅱ(1) Reduction of environmental impact of products(2) Reduction of direct environmental impact from products throughout lifecycle.
(3) Consideration of biodiversity when using land.

2. Komatsu shall work for conservation and promulgation of biodiversity through its social contribution activities.
(Operation)
Komatsu shall promote activities by means of a step-by-step approach.
Ⅲ(Cooperation with the community)
In order to protect the biodiversity rooted in regions, Komatsu will undertake activities in coalition with administrative agency,
local citizens, NGOs and other entities; by doing so we aim become a corporation communities can be proud of.
Ⅳ

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Biodiversity(Full participation activities)
Komatsu will promulgate the importance of biodiversity to all employees and undertake activities with their full participation.
We will involve corporations related to the lifecycle of Komatsu products and representative agencies as well as customers inthese activities and promote our initiatives on a global group-wide scale.

Ⅴ(Communication)
Communication: Komatsu will strive to educate and disclose related information to employees. In addition, Komatsu will
actively disclose information on activities being undertaken and work to contribute in heightening the level of societal
awareness on the importance of biodiversity.
Ⅵ

Guidelines for Biodiversity (114KB)

10th anniversary of biodiversity
Komatsu established its Declaration of Biodiversity and Biodiversity Guideline in January 2011. For the nine years since then, we havecontinued to perform One-site, one-theme activities at each base (plant and o ce) globally.
2020 is a landmark year as 10 years have passed since the Conference of the Parties (COP10) was held and the Aichi targets wereselected. Coinciding with this, we distributed a questionnaire to the Komatsu Group and surveyed their biodiversity conservation
activities to identify future subjects and policies to implement in the future.
The results of the survey, showing the status of each base, are below.
The management of each base recogni/es and understands the biodiversity conservation activities to be an important managementtask, and all employees participate in the activities.
Because the activities also serve as environmental education for the next generation (e.g. the children of the employees and thecommunity) and are promoted in cooperation with the government and local communities, the activities have gained theunderstanding of the community and are also a source of pride for the community.
Recogni/ing that biodiversity conservation activities are closely associated with the establishment of a society in harmony withnature, they have set not only goals for the biodiversity conservation activities in a restricted sense but also improvement goals forCO2 and water consumption and waste reduction in our operations (throughout the life cycle) and are implementing activities toachieve them.
In the future, to expand biodiversity conservation activities to the entire life cycle, we will explain these activities to the supply chain
and motivate them to proactively participate in activities.

[Examples in Japan and other countries]＊Excluding the cases introduced in environmental reports in the past.

1．Land use consideration

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Koriyama Plant: Biotope on the premises

Hensley's Dallas facility：Bioswale

2．Community contribution

Oyama site: Tide prevention forest restoration volunteer project in Iwaki

3．Ecosystem conservation

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Biodiversity

Oyama Plant: Around the Manabi-no Mori

Biodiversity Survey at te Field Testing Department Test Engineering
Center, Development Division
The Oita Test Center, where the quality of construction equipment is checked, is located in a rich natural area. To maintain thisenvironment, the test center is engaged in environment conservation activities daily. To assess how our business activities impact thesurrounding environment in our environment conversation activities, we investigated the ecological system in FY2011 and found that a
lot of local and rare species were living and growing in the area, and it was established that a good natural environment was being
maintained. Eight years later, to check for any changes after the investigation, we performed the assessment again, looking into thecurrent situation of our biodiversity and ecosystem services in FY2019.
This investigation is mainly based on the area analysis performed through on-site investigations and the production of a biodiversity
map (vegetation map). We inspected the inhabitation of the area and growth of the animals and plants through the year, collecting
basic information through drone photography, vegetation and timber surveys (tree height and diameter measurements) at 18 pointsof 10 m x 10 m locations which were used in the previous investigation, together with research companies and our employees.
As a result, rare species populations increased over the levels of the previous investigation, and 10 new rare species were identied. In
addition, we conrmed that the locations where non-native plants grew preferentially decreased and that the area where indigenous
plants grew increased.
One activity typical of the eorts that brought about these good results is the creation and maintenance of habitats in 20 locations on
the premises that consider the securing of wetlands where rare amphibians and aquatic plants can live and grow, the continuity
between water areas and woodlands, and an open environment where bird species can move about actively.
In addition, the continued eorts of our employees to eliminate non-native plants led to an increase of indigenous plants. It wasevaluated as an activity leading to healthy vegetation.
We will continue these activities to maintain and further improve the good, natural environment and work to ensure that theseconcepts and activities penetrate into the community by introducing them during plant visits, etc.

Fauna and Flora habitat survey

Activity to remove invasive plants

An investigative agency’s evaluation of our biodiversity conservation activities
As a result of the survey in FY2019, we conrmed diverse
Fauna and Flora inhabiting the area, including 10 newly
discovered rare species. It was a result of initiatives that

The benets harvested from a biodiversity-based
ecosystem (for example, food supply and waterpurication) are called ecosystem services. We
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have been continually implemented, the creation of aeld of silver grass, a domestic species, after theremoval of invasive plants, the regeneration of a shining
village forest, and the creation of a new habitat thataims for the creation of an ecological network. In
particular, as an advanced example of what is possible inthe construction, mining and utility equipment eld,that these initiatives were carried out and the results
were reaped within an experimental laboratory whose
land was planned to be altered is highly commendable.
Greenfront Research Lab.

evaluated ecosystem services at Komatsu's Test Centerfor the rst time in 2011. At that time, it was quite anadvanced initiative. It is wonderful that, since then,these biodiversity conservation activities havecontinued for nearly 10 years, and have been steadily
producing results. At the Test center, ecosystemconservation activities that suit the local community,
such as the removal of invasive species and theestablishment of a village forest, are being
implemented.
Mitsubishi UFJ Research and Consulting Co., Ltd.

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Communication with Stakeholders

Communication with Stakeholders
Communication with Shareholders
Operating within our commitment to high managerial transparency, Komatsu discloses information in a proper and timely manner
through interactive dialogue and constructive approaches to investor relations on a global scale.

1. Activities for Corporate Investors and Securities Analysts
On the same day that quarterly business results are announced, the company holds explanatory sessions for corporate investors andsecurities analysts (we also release this information on our website). Corporate representatives visit institutional investors outside
Japan (primarily in the U.S. and Europe) to explain recent business performance statistics and other critical information.

2. Informational Meeting for Individual Shareholders
To create the opportunity to communicate with individual shareholders, Komatsu convenes shareholders' meetings in major cities inJapan twice a year, with top management explaining the company's performance statistics and management strategies. In 2019, we
held meetings in Komatsu City and Nagano City in December, during which the president and CEO provided insight into the businessenvironment and corporate performance data. Many questions were raised during the Q&A session, which covered a wide range of
topics such as mining, machinery business, environmental response, and corporate governance.
Since launching in 1997, our shareholder meetings have been convened 49 times, with about 16,400 shareholders participating in
attendance to date.

Shareholders' meeting held in Komatsu City

Shareholders' meeting held in Nagano City170

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3. Plant Tours for Individual Shareholders
Komatsu holds plant tours for individual shareholders to further deepen their understanding of the company. Tours were held at theTechno Center (Shizuoka) in August 2019, then, at Osaka Plant (Osaka), Ibaraki Plant (Ibaraki), Awazu plant (Ishikawa) in September- October, and Osaka plant (Osaka) in February 2020 for ten days in total.

Plant tour for shareholders at Osaka Plant

Plant tour for shareholders at Ibaraki Plant

4. Tour of the Techno Center for Individual Shareholders
In August 2019, Komatsu held a tour of the Techno Center (Izu city, Shizuoka prefecture) for our shareholders and their families.

Tour for shareholders at Techno Center

5．Meetings for Individual Investors
Komatsu holds meetings for individual investors to explain our business andmanagement strategies as well as to cultivate a deeper understanding of our company. In
FY2019, these meetings were held in 7 cities in Japan.

Meetings for individual investors

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DATA

Events for Shareholders in FY2019 (in Japan)
Location

Approximate umber of articipants

Shareholders' Meeting

Komatsu, Nagano

759

Plant Tours for Shareholders

Awazu Plant, Ibaraki Plant, Osaka Plant,
Techno Center, etc.

485

Meetings for Individual Investors

7 cities in Japan

420

Communication with Employees
Within Komatsu, the president convenes a “Meeting with the President” periodically at each business site in Japan. At these meetings,
the president directly explains the business environment and related issues, and also takes part in a Q&A session held for employees
and upper management. The content of these meetings, held at the head oce in Tokyo, is simultaneously transmitted by TV broadcast
to other business units in Japan and later published on the company intranet in English to share the information with Group employees
around the world.
We are currently proactively engaged in holding employee meetings at our overseas subsidiaries in order to provide a place forcommunication to take place with local Group employees.
In addition to these measures, we launched an intranet bulletin board, entitled “Virtual Oce of President,” in January 2014 to sharethe questions and answers exchanged during the meeting with the president with employees around the world. The site is updated
each week with new questions, and as of March 31, 2020, a cumulative total of 283 questions on specic topics, along with thepresident's answers, explanations and messages to employees, have been published in Japanese and English.

Employee meeting held at the head oce

“Virtual Oce of President” on the intranet

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Communicating with the Local Community (E orts in Japan)
We regularly open our plants to the public and hold various events during “Plant Fairs” to cultivate an understanding of our businessamong local residents. The events were held at six plants in FY2019 and were attended by about 61,000 people.
In the Koriyama area, we held a variety of events in cooperation with our group companies and welfare organizations located in
Koriyama city. An ICT construction equipment test-ride event and a construction equipment exhibition were held. The children were
especially excited about the test-ride on construction equipment that they are not usually familiar with. The Komatsu Women's JudoClub also participated in this activity and coached Judo classes for children, which was very exciting.
Date

Plat

Number of isitors approx.)

May 18

Oyama and Tochigi Plant

11,000

May 19Awazu Plant

14,000June 2

Ibaraki Plant

11,500July 13

Kanazawa Plant

10,000

September 21

Koriyama Plant

４,500

November 10

Osaka Plant

10,000Ibaraki Plant

Kanazawa Plant

Koriyama Plant

Osaka Plant

173

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Management ofEnvironmental andSocial Initiatives

Contents

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Data

175

Major Environmental Achievements in the previous year

180

Environmental Education

183

Environmental Accounting

188

Site Data

195

Scope of Environmental Data/Calculation Standards

199

Amount of CO2 Emissions by 2 Scope3

200

Independent Practitioner's Assurance

202

Other CSR Data174

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Major Environmental Achievements in the previous year

Major Environmental Achievements in the previous year.
Environmental Management
Theme

Index

Referenceyear

FY2019Goa

FY 2019
Achivement

Public rerations ofenvironmental activities

CDP evaluation-

Climate : A
Water ：A

Climate : A
Water : A-

Public rerations ofenvironmental activities

Public environmental reporting-

Publishing

Published(July）

Remarks

Research & Development
Theme

Index

Referenceyear

FY2019 GoaFY2019 Achievement

Development of lowemission construction
machinery and industrial
vehicles(Compliance with emission
control regulations)- Developmentof Tier 4
regulationcompliant
vehicles- Developmentof Stage V
regulationcompliant
vehicles- Continued development- Continued development

Reduction of CO2
emissions from products(Promotion of fuele ciency improvement
during product operation)- Reduction of
CO2 emissions
from use of
products(construction
machinery,miningmachines)
Goal: 13%
reduction- Continued development
Achievement: 14% reduction

CO2
emissions
reduction(unit: %)

2010

175

Remarks

Goal for2030:
50%
reduction

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Major Environmental Achievements in the previous year

Theme

Index

Referenceyear

FY2019 GoaFY2019 chievement

Reduction of CO2
emissions fromconstruction machineryand industrial vehicles(changing to BDF biofuel)- Use of B7 to
B30-compliant
mixed light oil- B30-compliant oil employed inIndonesia- B20-compliant oil employed in
Minnesota in Summer

Improvement of recycling
percentage of construction
machinery and industrial
vehicles- Achieve 99%
or more in thenext developed
vehicle- 99% achieved in developed
vehicles (Tier 4 Final regulationscompliant vehicle and ICT
construction machinery)

Thorough management
and reduction of materials
with environmental
burdens in construction
machinery and industrial
vehicles・Reduction of
the volume ofhazardous
substances in
the next vehicle
to bedeveloped(Maintaining a
90% reduction
compared to1998)- Operating asystem thatmanageshazardous
substances per
part(REACH
Compliant)- Maintained 90% reduction of lead
usage compared to 1998
・Added 8 new SVHC, which are
speci ed in REACH and managed
use statuses of SVHC. Used thesystem to record data of themodels for the EU and the models
mass-produced or developed in
the EU(Investigated substances
contained in each part)

176

Remarks

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Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Major Environmental Achievements in the previous year

Production
Index

Referenceyear

FY2019 GoaFY2019 chievement

Remarks

CO2 emissions

Improvement ofbasic unit

2010

24％ or more
reduction

31.5％ reduction

Goal for 2030:
50% reduction

Recyclable energy usage

Percentage ofelectricity
consumed

10％ or more

10.7％

Goal for 2030:
50%

Water input volume

Improvement ofbasic unit

2010

49％ or more
reduction

49.4％ reduction

Goal for 2030:
60% reduction

Discharged waste volume

Improvement ofbasic unit

2010

12％ or more
reduction

12.7％ reduction

Goal for 2030:
40% reduction

50% reduction

60.8％ reduction(improved 0.1 point
over the previous
year）

20％ or more

20.1％

Theme

Chemical release volume(VOC emissions volume)

Improvement ofbasic unit

Reforestation

Reforestation rate

2005

177

Only facilities
in Japan

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Major Environmental Achievements in the previous year

Logistics
Referenceyear

FY2019Goa

FY2019
Achievement

Remarks

52%

Use of JR for component
transportation reduced due to adecrease in production volume fromJanuary 2020.

Theme

Index

Shift to transportationmeans with a low
environmental burden
Increase use of domestic
vessels and JR

Modal shift
rate per
500km

Decrease oftransportation distance
Promoting use of nearby
ports for exported
vehiclesIncrease use ofKanazawa Port

Kanazawa
Port use
percentage
for exported
vehicles

ー

50%

48%

Decrease oftransportation distance
Export vehicles using
nearby ports
Increase in use of
Hitachinaka Port

Hitachinaka
Port use
percentage
for exported
vehicles

ー

99%

99%

Improvement of CO2
emissions per cargoweight (basic unit) fromtransportation of
products and parts
Domestic transportation

Improvement
per basic unit

Improvement of CO2
emissions per cargoweight (basic unit)
from transportation of
products and parts
Overseas transportation

Improvement
per basic unit

ー

2006

2011

55%

67.4%

92.0%

178

Due to a decrease in exported vehicles
for North America, which were
supposed to ship from Kanazawa
Port.

75.2%

A transportation weight-based index
is used as a basic unit, which greatly
depends on an increase/decrease ofexported vehicles. Because thenumber of exported vehicles in thisterm decreased, compared to theprevious year, we failed to achieve theplan.

100.6%The basic unit improved by 0.8%,
compared to the previous year, which
includes an increase of 3.3% due toaddition of KIPL (India).

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Major Environmental Achievements in the previous year

Procurement
Theme

Index

Referenceyear

Horizontal expansion of Komatsu's
activities to cut electricity consumption
by halfーImplementation of environmental
regulations audit
Activities to reduce water consumption(10 companies)

FY2019 GoaFY2019 AchievementーExpand to 93 Midorikai member
companies

Continued to expand
to all 93 member
companies

ーー

Implementing at fourMidori-kai member
companies

Implemented at 4
member companies

ーー

Reduce clean water
use 15% or more

17% reduction

Remarks

Sales & Services
Theme
Implementation of
measures toprevent oil leakage

Reference
year

Index
ー

FY2019 GoaFY2019
Achievement

Remarks
Installation of sandbags,
drainage route diagrams,
and emergency contact
networksーAll bases

All bases
Implemented
at 4companies

Introduction ofwaste
management
systemsーーAllcompanies(7
companies)

Provision ofenvironmental
education

Number of bases whereon-site instruction
workshops were heldー

40 bases17%
Reduction

Sales expansion ofenvironmental
products

Sales expansion
activities for Tier4
modelsSales expansion
activities for FE

ー

Sales
expansion
based on thesales plan

Achieve thesales plan

Promotion of smart
construction work

Visitors to IoT Centerー

10,0006,927

179

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Environmental Education

Environmental Education
Komatsu is committed to employee education with regards to good environmental practices. Under our basic framework, provision of
education is divided according to two unique categories according to type; Dissemination of common knowledge falls under theoversight of the Head Oce, whereas specic vocational training is managed by respective divisions.
We focused on education for upgrading of environmental internal auditors in FY2019.
We have updated our FY2014 environmental education program for newly appointed managers, which is now conducted through an eLearning platform.
Despite the fact that we already meet the legislatively mandated quota of personnel with environment-related certication, we intend
to implement further training in order to increase this number.

Courses in Environmental Education and Training in Japan (excluding
general environmental courses) *Independent Practitioner's Assurance

Head O ce
No.

Course name

Target1

Newly appointed manager training

2

Participants
FY2016FY2017FY2018FY2019Komatsu Group newly
appointed managers

193

161

171

155

Training new employees

New Employees(Komatsu and aliates)

322

329

369

383

3

Advanced environmental education(held every two years)

Environmental specialists(Komatsu and aliates)

-

-

-

19

4

Overview of the ISO14000 series

Managers(Komatsu, aliates, andbusiness associates)

80

73

36

46

5

ISO14001 Standard Amendment(2015 Revision)

Stakeholders regarding
ISO14001 amandment

79

-

-

-

6

Training of internal auditors /Refresher courses

Environmental auditors(Komatsu, aliates, andbusiness associates)

61

89

336

87

180

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Environmental Education

No.

Course name

Target7

Explanation of environmental laws
and risks

8

Participants
FY2016FY2017FY2018FY2019Managers and employees

-

-

250

-

Development and manufacturing(introductory)

Development andmanufacturing sta(for second-year
employees)

287

249

187

190

9

Environmental training for
manufacturing engineers

Assistant foremen/
foremen/ manufacturing
engineers/ students ofKomatsu Institute ofTechnology

230

226

227

145

10

Lectures on the environment,
experience-oriented education

Komatsu Group employees

1,662

1,796

627

1,267

Divisions overseeing environmental management at plants
Komatsu and Komatsu Group manufacturing facilities in Japan(including Technology Innovation Center, Field Testing Department)No.

Course name

Target1

Education in the basics of auditing

2

Participants
FY2016FY2017FY2018FY2019Managers and employees

120

90

169

196

Overview of the ISO14000 series

Managers and employees

1,093

559

502

565

3

Training of internal auditors

Environmental auditors

13

61

34

26

4

Training new employees

New Employees

1,270

1,866

1,759

1,205

5

Regulatory education and personnel
exchange

Employees (and otherparticipants)

217

835

510

15

Specialist training

Environmental
conservation practitioners(persons involved inregulatory a airs, etc.)

435

328

464

429

6

* In addition to the education and training courses listed above, Komatsu also held courses dealing with environmental issues intended for sales agents.
181

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleSocialContribution
Activities

Data

Index

Environmental Education

Number of Persons Having Environment-related Certi cate
Independent Practitioner's Assurance
Komatsu and Komatsu Group manufacturing facilities in Japan(including Head o ce, Technology Innovation Center, Field Testing Department)

Certi cate name

Number of ersons ith certi cate*
FY2016FY2017FY2018FY2019Pollution control administrators

223（31）220（35）219（35）222（35）

Energy administrators

41（9）

39（9）

41（9）

38（9）

Environmental management systemassociate auditors

2

2

5

4

* Figures in parentheses indicate the number of o cers required.

182

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Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Environmental Accounting

Environmental Accounting
Komatsu fully reports on the content of our environmental accounting systems in order to obtain an
objective and accurate evaluation of our environmental conservation activities.

Environmental Costs (Investments and expenses)
Independent Practitioner's Assurance
Komatsu and Komatsu Group manufacturing facilities in Japan(including Technology Innovation Center, Field Testing Department)

Investment
Category

1. Business area cost

FY2018

Expenses

FY2019Investment*1(millions ofyen)

Investment*1(millions of
yen)

447

1,163

Contents

FY2018FY2019

Expenses*1(millionsof yen)Expenses*1(millionsof yen)

2,246

2,303

Breakdown(1).
Pollution
prevention
cost

192

235

Investment for
installation
andconversion ofpollution
mitigation /prevention
facilities

183

329

370

Contents

Cost ofmaintaining
equipment for
mitigation /prevention of air
and water
pollution and fornoise andvibration
prevention(labor anddepreciation
costs)ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Environmental Accounting

Investment
Category(2).
Globalenvironmental
conservation
cost

(3).
Resource
circulationcost

2. Upstream
downstream cost

3. Administration cost

FY2018

Expenses

FY2019Investment*1(millions of
yen)

139

116

0

0

Investment*1(millions ofyen)Contents

FY2018
Expenses*1(millionsof yen)FY2019
Expenses*1(millionsof yen)Contents

893

Investment for
implementing
energyconservation
measures(installation ofenergy saving
facilities, etc.)

932

1,116

Cost ofmaintaining
energyconservation
facilities, such ascogeneration
systems(labor anddepreciation
costs)

34

Investment for
reducing thevolume ofwastematerials

985

817

Waste material
processing cost0

Additional
investment
needed toprovide ecofriendly
product
services

363

Reduction of theenvironmental
impact of massproduction units

924

Cost ofmaintaining
environmental
management
systems
Cost of creating
green spaces andbeautifying
manufacturing
sites

1

Investment for
beautifying
manufacturing
sites

184

241

775

ESG Databook 2020

Management ofEnvironmental andSocial Initiatives

Contents

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Environmental Accounting

Investment
Category

FY2018

Expenses

FY2019Investment*1(millions ofyen)

Investment*1(millions ofyen)

4. R&D cost

195

534

5. Social activity cost00Contents

Investment inresearch
facilities for
reduction ofenvironmental
impact

FY2018FY2019
Expenses*1(millionsof yen)Contents

16,22417,804

Cost of R&D
activities toreduce theenvironmental
impact ofproducts
Cost of R&D
activities todevelopenvironmentallyfriendly
construction
equipment

39

48

Expenses*1(millionsof yen)6. Environmental
remediation cost

0

0

212

145

Total

643

1,698

19,735

21,587

Cost ofconducting
surveys andremedialcountermeasuresrelated to soil
and groundwatercontamination
PCB disposal
costs

1 ll gures are rounded o to the nearest million yen.

※185

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Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Environmental Accounting

Environmental Eects
Independent Practitioner's Assurance

Environmental impact reduction eects
Komatsu and Komatsu Group manufacturing facilities in Japan

Items of environmental impact

Reduction amount #t/year)

Rate of year-on-year changes #%)CO2 emissions-34,456-16

Water consumption-271,644-9

Waste materials generation-3,343-18

Economic benets
Komatsu and Komatsu Group manufacturing facilities in Japan

Tangible bene ts
Type

Monetaryvalue*1(millions ofyen)Maor activities

Energyconservation

248

Installation of energy-saving
facilities

Resource
conservation

55

Saving heating and coolingcost by biomass utilisation

Wastematerials
reduction

53

Promotion of recycling
through thoroughgoingsortingGain on saleof valuables

246

Sale of scrap, used paper,
waste oil, etc.

Other

5

-

Total

607

Avoidance bene ts ofenvironmental risks*2

Contribution to pro ts*2

* In FY2019, there were no
major accidents or legal
infractions that would
contaminate the environment.
* No litigation costs wererequired in Japan during
FY2019.

Proceeds from mobile
recycling equipment
Proceeds from value
added due to reduced
environmental impact of
products*1 Figures are rounded o to the nearest million yen.

186

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Environmental Accounting*2 Komatsu used statements instead of numeral gures to describe the "Avoidance benets of environmental risks" and the "Contribution to prots". We
will give further consideration to the interpretation and the understanding of eciency.

E ects on Society *1
Environmental impact reduction eects

Tangible benets

Environmental impact reduction resulting from on-site
recycling methods
Environmental impact reduction resulting from productoperation
Waste components reduction resulting from "Reman"business

Reduction of expenses for processing waste materials
Savings in operating and maintenance costs
Reduction of repair costs*1 We are aware of the potential impacts on society that could arise from the use of our products. Qualitative information regarding the most signicanteects are referenced here.

187

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Site Data

Site Data
Total Data
Site Data (by Region)
Independent Practitioner's Assurance

Japan
Item

Environmental impact

Actual value

Total CO2 emissions

186,647 t-CO2

NOx total amount

116,828 Kg

SOx total amount

5,809 Kg

Total emissions of waste

14,804 t

Amount recycled

14,730 t

Recycling rate

99.8 %

BOD emissions

3,866 Kg

COD emissions

7,286 Kg

Wastewater

2,400,107 m3

Output of in-house power generation

27,949 MWh

Energy consumption

Item

Actual consumption

Purchased electricity

317,401 MWh

3,010,229

Heavy oil A

4,717 kℓ183,473

Kerosene

2,296 kℓ

83,788Light oil

3,487 kℓ

131,642

188

Converted to calorie equivalents GJ)

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Site Data

City gas

6,659 km3

274,402

LPG

3,962 t198,358

Gasoline

148 kℓ

4,932

Wood chips

5,839 t71,817

Total

Water consumption

3,959,641

Groundwater

2,382,596 m3

Industrial water

2,994 m3

Supply water

229,634 m3

Total

2,615,224 m3*1）Total emissions of waste are expressed as a composite of the amount recycled (excluding valuables) and the amount disposed.
*2）Recycling rate is calculated by dividing the amount recycled (including valuables) by the amount generated (including valuables).
*3）Output of in-house power generation includes electricity sold.

Independent Practitioner's Assurance

The Americas

Energy consumption

Item

Actua a ue

Purchased electricity

122,615 MWh

Light oil,Gasoline, et al.

603 kℓGas

12,445 km3

LPG

156 t

District heating

-

Steam

-

Total energy consumption

1,698,317 GJ

CO251,950 t-CO2

Private Power generation
Water consumption

58 MWh280,456 t

189

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Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Site Data

Total emissions of aste

47,269 t
Independent Practitioner's Assurance

EuropeEnergy consumption

Item

Actual alue

Purchased electricity

27,951 MWh

Light oil,Gasoline, et al.

173 kℓGas

3,974 km3

LPG

12 t

District heating

8,602 MWh

Steam

-

Total energy consumption

448,226 GJ

CO218,022 t-CO2

Pri+ate Power generation

17 MWhWater consumption

57,411 t

Total emissions of aste

9,145 tIndependent Practitioner's Assurance

Asia
Energy consumption

Item

Actual alue

Purchased electricity

177,398 MWh

Light oil,Gasoline, et al.

993 kℓGas

5,781 km3

LPG

880 t

District heating

-

Steam

8,627 t190

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Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

SocialContribution
Activities

Data

Index

Site Data

Total energy consumption

2,021,593 GJ

CO2146,938 t-CO2

Pri+ate Power generation

2,248 MWh

Water consumption

604,173 t

Tota emissions of aste

23,836 t*1）Total emissions of waste are expressed as a composite of the amount recycled and the amount disposed.
*2）Output of in-house power generation includes electricity sold.

Independent Practitioner's Assurance
Energy consumption (Total of production o ces)
Energy consumption(TJ)

Basic nit ndex

2016

7,239

83.2

2017

8,641

84.3

2018

9,814

84.7

2019

8,128

75.6

Basic Unit Index：Index with base year（2010） 100
Energy consumption per internal manufacturing value
Independent Practitioner's Assurance
Scope-2 CO2 emissions (Total of production sites)
Standard

CO2(kt）
Location-based

348

Market-based

315

191

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Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Site DataJapan
Site Data (Japan) (7.25MB)
Awazu Plant
Osaka Plant
Oyama Plant
Koriyama Plant
Himi Plant
Komatsu NTC Ltd.

Kanazawa Plant
Ibaraki Plant
Tochigi Plant
Shonan Plant
Development Division, Technology Innovation Center
Komatsu Cabtec Co., Ltd.

Overseas
Site Data (Overseas) (345KB)
The Americas
Asia

EuropeSite Data（Sales and After-sales Divisions）
Independent Practitioner's Assurance

FY2019 Komatsu Customer Support Japan Ltd. nvironmental Performance Data
Manufacturing facility

Komatsu ustomer upport apan td.

Location

Shirokane, Minato-ku, Tokyo

Activities

Sale, service and rental of construction equipment and forklift trucks

Number of bases

250

Number of employees

4,705

Data of ISO14001 certi cationacquisition

May 2018

Environmental impact

Item

Actual value

Total CO2 emissions

7,451 ｔ-CO2

Total emissions of
waste

13,057 ｔ

192

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Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

Site Data

Amount recycled

11,045 ｔ

Recycling rate

84.6 %
Actualconsumption

Converted to calorie equivalents(GJ)

Electricity

13,976 MWｈ

132,546

Heavy oil A

36 kℓ

1,381

Kerosene

399 kℓ

14,556

Light oil

116 kℓ

4,405

LPG

30 ｔ

1,517

City gas etc.

-

2,758

Item

Energy consumption

Total

157,163

Site Data（Non-manufacturing Divisions）
Independent Practitioner's Assurance
Site ata of on-manufacturing ivisions
Manufacturing facility
included
Environmental Impact
Energy consumption

Head O ce, Field Testing Department, Techno Center, General Education Center, Shinomiya Building
T, Recreaion Facilities（5 sites）
Item

Actual value

Total CO2 emissions
Item3,473 t-CO2
Actual consumption

Converted to calorie equivalents (GJ)

Purchased electricity

4,712 MWh

44,692

Heavy oil A

84 kl

3,281

Kerosene

0 kl

11

193

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Site Data

Light oil

372 kl14,148City gas

12 km3

485

LPG

96 t

4,830

Gasolie

3 kl

93

Total

67,539194

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Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Scope of Environmental Data/Calculation Standards

Scope of Environmental Data/Calculation Standards
Komatsu Group Manufacturing Facilities in Japan
Komatsu (parent company) manufacturing facilities, with a focus on the following nine plants
Awazu Plant, Kanazawa Plant [including Kanazawa-Daiichi Plant and Kanazawa-Daini Plant], Osaka Plant [including Rokko Plant],
Ibaraki Plant, Oyama Plant [including Komatsu Cummins Engine Co., Ltd., Industrial Power Alliance Ltd. and GIGAPHOTON, Inc.],
Koriyama Plant, Shonan Plant [including KELK Ltd.], Tochigi Plant, and Himi Plant.
Komatsu Group manufacturing facilities in Japan, with a focus on the aforementioned nine plants and the following two business
units
Komatsu Cabtec Co., Ltd., Komatsu NTC Ltd.

Komatsu Group Manufacturing Facilities Outside Japan
Komatsu Group manufacturing facilities outside Japan, specically the 21 business units appearing on the world map below.

Komatsu Group manufacturing facilities, both foreign and domestic: Pertaining to all 32 of the oces mentioned above.

Guidelines“Environmental Report Guidelines 2018” (Ministry of the Environment of Japan)
Basic Guidelines on Accounting for Greenhouse Gas Emissions Throughout the Supply Chain Ver 2.3(Ministry of the Environment and Ministry of the Economy, Trade and Industry of Japan)
Database on Emissions Intensities for Calculating Greenhouse Gas Emissions, etc. through a Supply Chain Ver. 3.0 (Ministry of theEnvironment and Ministry of the Economy, Trade and Industry of Japan)

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Theme 2 :Developing
PeopleData

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Index

Scope of Environmental Data/Calculation Standards

GRI Standards
See the GRI content index
GRI Standards INDEXPeriod Covered
Primarily, this report covers data acquired from April 2019 to the end of March 2020, with a portion of information that involves dataacquired after April 2020.

Calculation base of tpical environmental data
Classi cation

Item

GHG Energy

Calculation Method

EnergyEnergy = (fuel, electric energy, etc.) x energy conversion factor
Fuels (other than biomass), conversion coe cient of electric power: standard
heating value of the Agency for Natural Resources and Energy (2013 value)
Biomass fuel: National Woodchips Industry Association (Japan)
Regional heat: site reported value (1.54 GJ / MWh)
Steam: Site report value (2.571 GJ / t)

GHG

Energy originated CO2 = (fuel quantity, electricity quantity) x CO2 emission factor
Non-energy originated GHG = Gas emissions x Global warming potential (GWP)
CO2emission factor
Electricity: 2010 value of IEA CO2 EMISSIONS FROM FUEL COMBUSTION 2012
Fuel: Japan,Overseas;Ministry of the Environment, Ministry of Economy, Tradeand Industry, Greenhouse gas emissions calculation and report manual
GWP: Value of greenhouse gas emissions calculation, reporting and publication
systemEnergy, CO2 emission
in basic unit

Basic unit for each plant = (energy, CO2) / (Internal manufacturing value), index is avalue with base year 100.
Base year: 2010

Location-based Scope2

CO2 emission = purchased electricity quantity x CO2 emission factor
CO2 emission factor:
Japan; Ministry of the Environment, Ministry of Economy, Trade and Industry
Emission Factor by Electric Utility Substitution Value
Overseas; 2010 value of IEA CO2 EMISSIONS FROM FUEL COMBUSTION 2012

Market-based Scope 2CO2 emission = purchased electricity quantity x CO2 emission factor
CO2 emission factor:
Japan;Emission Factor by Electric Power Company
Overseas; 2010 value of IEA CO2 EMISSIONS FROM FUEL COMBUSTION 2012
However, the electricity generated from renewable energy source has zero
emission factors

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Scope of Environmental Data/Calculation Standards

Classi cation

Item

Scope3Calculation Method

C1

Purchased product service: Product weight x emission factor + cooperatingcompany CO2 emission amounts + Purchased packaging material weight x
emission factor

C2

Capital goods: capital investment amount x emission factor

C3

Fuels and energy related activities not included in Scope 1 and 2: fuel quantity
purchased x emission factor on the upstream side + purchased electric energy
amount x upstream side emission factor

C4Transportation, Delivery (upstream): Fuel consumption (amount) x Emission factor(coe cient according to Komatsu actual result survey)

C5

Waste from project: Waste volume x Emission factor (coe cient according to
Komatsu performance survey)

C6

Business trip: travel expenses x emission factor

C7

Employer commuting: commuting expenses x emission factor

C9

Downstream transport: transport volume x emission factor

C11

Use of products sold: Σ (Production volume per product model x Fuel consumption
x Product life)

C12

Disposal of products sold: Product weight x Emission factor
Emission factor
Power of C1/C2/C3, C6/C7/C12: Emission basic unit database (Ver 3.0) for
calculating greenhouse gas emissions of organi:ations through the supply chain of
the Ministry of the Environment
C3 Fuel: Carbon Footprint Communication Program Basic Database (Ver 1.01)
C9: Ministry of Economy, Trade and Industry ・ Ministry of Land, Infrastructure,
Transport and Tourism Guidelines for Estimating CO2 Emissions in the Logistics
Field

Sox Emissions

Total for heavy oil, kerosene, light oil and coke:Calculated from fuel quantity x sulfur content in fuelNOx Emissions

Total for heavy oil, kerosene, light oil, city gas, and LPG:
Calculated from Exhaust gas quantity x NOx concentration

BOD Emissions

Calculated from Wastewater x BOD Average Concentration Measurement Value

COD Emissions

Calculated from Wastewater x COD average concentration measured value

ExhaustDrainage197

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Scope of Environmental Data/Calculation Standards

Main data, ISO 14001 certi cation acquisition coverage
The coverage rate of main data and ISO 14001 was calculated using the number of people as an index.

1. Main data coverage

Data coverage rate at production sites: 96%

2. ISO 14001 certi cation acquisition coverage

ISO 14001 certi cation acquisition coverage rate at production sites: 95% (If KMC is not included : 100%)

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Amount of CO2 Emissions by 2 Scope3

Amount of CO2 Emissions by Scope3
Independent Practitioner's Assurance
Category

Rate (%)

Summary ata t-CO2

Scope3 (11)Customer Use

86.9

19,236

Scope3 (1)Manufacturing of Purchasable Goods
Scope3 (2)Capital Goods Construction and others
Scope3 (3)Fuel Procurement
Scope3 (4)Upstream Transportation disposal
Scope3 (5)Waste Transportation
Scope3 (6)Business Trips
Scope3 (7)Commuting
Scope3 (8)Upstream Leased Assets Operation
Scope3 (9)Downstream Transportation
Scope3 (10)Processing Sold Products
Scope3 (12)Product disposal
Scope3 (13)Downstream Leased Assets Operation
Scope3 (14)Franchise Member Companies
Scope3 (15)Investment Management

10.2
0.9
0.5
0.1
0.0
0.7
0.2
0.0
0.2
0.0
0.1
0.0
0.0

2,267
191
120
31
11
153
55
0
48
0
13
0
0

Total CO2Emission Amount (kt-CO2/year)

100.0

22,125

Note: When the gures in each category are rounded or truncated .
The amount may not coincide with the aggregate of the relevant gures.
Category 8 is included in Scope1,2, when it's evaluated.
Category 13 is included in Category 11, when it's evaluated.
Categories 14 and 15 have no activities subject to evaluation.

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Index

Independent Practitioner's Assurance

Independent Practitioner's Assurance
Regarding the Issuance of ESG Databook
Komatsu views an independent practitioner's assurance process as crucial for ensuring the integrity and objectivity of its ESG
Databook. For this reason, Komatsu has received an independent practitioner's assurance from Deloitte Tohmatsu Sustainability Co.,
Ltd., an a liate of the Deloitte Touche Tohmatsu LLC.
Deloitte Tohmatsu Sustainability Co., Ltd.

Independent Assurance Report (PDF：100KB）

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Independent Practitioner's Assurance

Supplementary Explanation regarding te Conducting of Independent
Practitioner's Assurance
Supplementary explanation regarding independent practitioner's assurance procedures

1. Buisiness units conrmed in this review(1) Komatsu Ltd. Head Oce(2) Komatsu Ltd. Osaka Plant

2. Comrmation buisiness units take place in a planned rotation. Records for buisiness units not visited during this review werereviewed at the Komatsu Ltd. Head Oce.

Points of an Independent Practitioner's Assurance
Komatsu has received an independent practitioner's assurance from Deloitte Tohmatsu Sustainability Co., Ltd. for this Web data, which
is marked by the independent practitioner's assurance logo where appropriate.

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Other CSR Data

Other CSR Data
Political Contributions
Our political contributions in FY2019 totalled 8 million yen.** Described in the Income and Expenditure Reports on Political Funds released on November 29, 2019 (on the website of the Ministry ofInternal A airs and Communications)202

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Social Contribution Activities

204

Accomplishments and Approaches for Social Contribution Activities

206

Komatsu's Initiatives for the Social Issues

208

Developing People Needed by the Community

209

Collaboration with Cummins Inc.

211

Disaster Relief

213

Clearing Anti-Personnel Landmines and Community Development Support

217

History of Demining Activities (International Treaties, Japanese government and Komatsu)

219

Promoting Sports̶The Komatsu Women's Judo Club203

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Accomplishments and Approaches for Social Contribution Activities

Accomplishments and Approaches for Social Contribution
Activities
While much of a business's responsibilities lie within the corporate sphere, it is nonetheless equally as important that a business takeresponsibility for local engagement within the social sphere. Komatsu is thus acutely aware of the importance for "Social Contribution
Activities" that help nurture and develop the local communities in our areas of operation. We emphasi(e themes in our social
contributions which utili(e the business acumen and know-how that we have cultivated in our business operations. This in turn allows
us to make use of our existing expertise to greatly increase the benecial impact and reach of our contributory activities.

Basic Approaches to Social Contribution (from “Komatsu’s Worldwide
Code of Business Conduct%)
CSR (Corporate Social Responsibility) is a multi-faceted topic, of which specic elements pertaining to the dierent aspects of its
implementation are subject to change according to country, region, or business practices. However, regardless of these variations, theunderlying axioms that drive these initiatives remain the same: companies must co-exist in harmony with society, responding to
expectations and building a relationship of mutual trust. As mentioned in other sections of this report, one of the principles that guides
the Komatsu Group on a global scale is the understanding that Komatsu should fulll its corporate social responsibilities throughintegration of CSR into our business operations. We further build on that belief by dening clear requirements for good corporate
citi(enship: a company should live up to societal expectations by promoting harmony and making real contributions for the benet of
the community in which it operates. Komatsu is proud to report that we live up to these high standards, and are proactively engaged insocial contributory activities across multiple regions.

5 Basic Principles for Social Contribution (from "Komatsu's Worldwide
Code of Business Conduct")Aims:

To clarify the responsibilities of Komatsu Group and its employees as members of the local community and guide their activities forsocial contribution accordingly.

Principles: Activities for social contribution should:
have continuity;
be reasonable to employees; andcontribute to the advancement ofpublic welfare;not be designed to advertise our
products or services.

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Accomplishments and Approaches for Social Contribution Activities

Social Contribution Expenditures of te Komatsu GroupWe have divided and summari&ed the results of our social contributions into 6 general categories. These can be found in the infographic
below:

Type of Social Contribution Expenditure(Millions of yen)

Cash contributions

707

Time contributions

316

In-kind giving

314Management overheads

797

Total

2,136

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Komatsu's Initiatives for the Social Issues

Komatsu9s Initiatives for the Social Issues
There are various social issues in the world in each region.
As the Komatsu Group develops its business globally, we listen to the voices of people living in the various local communities in ourareas of operation, and actively carry out support activities to improve the living standards. We consider conducting such social
contribution activities as a responsibility of doing business around the world.

Social Support Activities in Response to the COVID-19 Pandemic
Business partners - They are invaluable to Komatsu

For manufacturers, business partners (the suppliers of materials, parts, and components) are important partners that support productquality and reliability. Komatsu especially places great value on relationships with business partners and has grown together with themthroughout our long history. We have been thinking together with them and supporting each other, not only in terms of the
procurement of goods but also from the perspective of management and human resource development.
The Komatsu Midori-kai is comprised of 156 member companies that are the main suppliers in Japan. They supply approximately 80%of the items we procure in Japan. Representatives of Midori-kai member companies and top Komatsu management participate ingeneral conferences and roundable discussions for managers, etc. to share policies and issues with each other. We also establishedregional Midori-kai for China and for US and Europe. When the member companies of the Joint Associations of Business Partners inAsia are added, the total number of overseas member companies has exceeded 140.
Human resource development is the most important issue for Komatsu Group and our business partners. We provide them witheducation on quality control and production technologies, and the number of Midori-kai member companies participating in our QC
Convention, Technology Olympics, and other events is increasing steadily. In addition, they have been proactively participating in the
two-year internal school, the Komatsu Technical Institute, which fosters mid-career leader candidates related to productionengineering and manufacturing who will work globally, as well as next-generation leader development programs. Going forward, we
will continue to increase the opportunities to learn together with the employees of our group companies.

Activities in Response to the COVID-19 Pandemic
The COVID-19 pandemic has directly damaged our lives and health, but has also signi cantly impacted the economy, nance, medical
infrastructure, and other aspects of society.
Under the philosophy of supporting the areas that Komatsu excels in, we have provided construction equipment and temporary
housing to disaster areas for free through non-pro t social contribution activities. As countermeasures to address the pandemic, which
can be called a disaster, we are also contributing to society, utili7ing our strengths.

Producing and Donating Medical Supplies in Collaboration with Business Partners
In Japan, as the number of people infected by COVID-19 increases, the shortages of medical devices became the critical issue. Though
we do not have the equipment or skills to produce medical devices, Komatsu has some assets, like long-time collaborative
relationships with our business partners and our production and sales networks. By utili7ing these assets, we have procured and206

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Komatsu's Initiatives for the Social Issues

donated isolation gowns and face shields, which are personal protective equipment (PPE) for medical workers for which there isparticularly urgent need.
To procure them, we asked a Midori-kai member company to begin PPE production. At Komatsu, the sta of our production technology
also participated in the activity to improve the strength of the parts, productivity, and the comfort of the PPE during the prototyping
phase of the face shield.
After medical experts inspected the protective ability and comfort of the prototypes, 10,100 gowns and 8,000 face shields were
produced. We distributed them to medical institutions around the nation for free through the NPO, Peace Winds Japan, and thegovernment, utili7ing donations from our employees.

Teachers and students of Toyono-gakuen (Nagano) who madeisolation gowns

Through the personals networks of our supplier, we also received support from a garment making vocational school in Nagano
Prefecture. The teachers and students made 100 pieces of PPE from materials donated by a lter maker, one of Midori-kai member
companies and donated them to the medical institutions in the region.
In addition to the isolation gowns and face shields, Komatsu and our employees are carrying out the following support activities:
Country/Region

Activities

The Americas-Donations equivalent to 350,000 dollars in total<Breakdown>- A 250,000-dollar joint donation with our employees to the food support organi7ation, Feeding
America- 100,000 dollars donated to local communities

ChilieSupport for road disinfecting work using sprinkler vehicles (private-public cooperation)

India

Donations equivalent to 10 million rupees (national or state welfare funds and skill education support
for construction equipment operators)

EuropeDonations equivalent to 100,000 euros from our group companies in Europe (for medical and foodrelated purposes, depending on local needs, and support for multiple organi7ations)Japan

Donation of 100,000 N95 medical masks from our stock to the Red Cross, the government, autonomous
bodies, medical institutions, etc.

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Developing People Needed by the Community

Developing People Needed by the Community
When we asked ourselves:"What sort of social contribution activities would meet the needs of regional communities and make the bestuse of Komatsu's strengths?" We arrived at the answer: "developing people." We are working in cooperation with several entities suchas national and local governments as well as schools, to carry out human resource development programs that are tailored to eachregion's needs and enable participants to acquire skills that will open up various employment opportunities.

Various Areas and Forms of Support

Developing Human Resources Tailored to Regional Needs Worldwide
Using the skills and know-how cultivated through our core business, Komatsu supports the development of human resources that areneeded not only within our company, but also in local communities.
Expectations for human resource development can vary greatly from community to community. At Komatsu, as we do business on a
global scale, we make eorts to understand what each community needs and work on providing that support accordingly in various
areas and in dierent forms.
The pyramid graph below shows the areas in which Komatsu is supporting human resource development. It also shows that the closer
you get to the top of the pyramid, the more closely linked the program is with Komatsu businesses. The base of the pyramid shows ouractive support of activities such as science classes in elementary schools, mainly in dierent parts of Japan, USA and Europe. The nextlevel up is to provide basic education, which consists of our support towards people who cannot or were not able to receive the level of
education necessary to nd employment, due to circumstances specic to their country or region. We currently run such programs inChile and South Africa. At the next level, we support universities and vocational training schools in many regions by providing
Komatsu's curriculum and equipment, as well as instructors. At the top of the pyramid, we are working with national and local
governments and with our customers to develop human resources, particularly in regions where human resource development is asocial challenge.
The actual content of the support includes dispatching instructors and trainers; providing educational materials, equipment andfacilities; accepting apprentices; and various other means utili,ing the full potential of our know-how.

Support for Developing Human Resources

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Developing People Needed by the Community / Collaboration with Cummins Inc.

Dispatching instructors

Providing educational
materials and equipment

Providing facilities andsupporting operations

Accepting apprentices

Collaboration with Cummins Inc.
We believe that collaborative CSR activities deliver more eective outcomes than those conducted alone, by sharing the people, knowhow, and other resources of each company. In promoting social contribution activities in the past, Komatsu has collaborated withentities such as non-prot organi0ations that have their own uni'ue know-how. In 2016, we agreed with our business partner, Cummins
Inc. in the U.S., to collaborate in the eld of local human resource development.

Komatsu and Cummins' Common Objective
Komatsu and Cummins Inc., a major engine manufacturer in the U.S., have built a strong relationship of trust over the years as partners
in the engine business. Both companies have already expended much energy into supporting human resource development in local
communities as part of social contribution activities, and have already collaborated in several areas. One of the main programs is
Technical Education for Communities (TEC). Both companies have partnered through contract to utili0e their pool of resources and bestpractices, to expand the support of human resource development globally.
Cummins Pro leCorporate name

Cummins Inc.

Esta lished

1919

Headquarters

Columbus, Indiana, U.S.

Business segments

Engine, Power systems, Components, Distribution

URL

http://www.cummins.com/

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Collaboration with Cummins Inc.

Collaborative Development of the TEC Program - South Africa Case Study
TEC is a program of activities to provide students who major in mechanical and/or electrical engineering with a curriculum of technicaland practical vocational training that takes advantage of the knowledge of both Komatsu and Cummins.
We started a three-year curriculum at Sedibeng TVET College in Johannesburg, South Africa, accepting 31 students in May, 2018. In thiscurriculum, students learn how to maintain engines and operate construction/mining equipment through lectures and internships.
Through the TEC program, students acquire knowledge useful for practical operations, which increases job opportunities withfavorable conditions and improves the sense of personal ful llment. Also, in the long term, the increase in the number ofskilled engineers will play an active part in local companies, including Komatsu Group companies. In turn, contribution to the entire
local economy is expected.
The companies that have been playing a major role in promoting TEC in South Africa are Cummins Africa and Komatsu Africa Holdings(Pty) Ltd., a Komatsu Group company. In providing this curriculum, the company worked to dispatch dedicated instructors, provide
educational materials such as cutaway models, and support the creation of the training curriculum. After the launch of the curriculum,
the companies have been supporting the entire program continuously. Moving forward, Komatsu will deepen the collaboration with
Cummins and promote the operation of TEC programs globally.

TEC entrance ceremony in South Africa

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Disaster Relief

Disaster Relief
Many of Komatsu's products (especially construction equipment) are vital for recovery and reconstruction in the wake of a natural
disaster.
In the event of an emergency, we promptly grasp the local situation and support disaster recovery in a substantial way, such asproviding equipment needed by the disaster area. As part of these eorts, we have initiated support activities using drones as well as
construction machines. The latest activities are as follows:

Forest Fire Relief in Australia
In Australia, large-scale forest res occurred successively from September 2019 toFebruary 2020. Before heavy rains caused the res to subside in February, more than
100,000 km2, nearly one third of the land area of Japan, caught re. Approximately 6,000
buildings were aected, and many people were injured or killed. Air pollution caused bysmoke and ecosystem destruction were also signicant. Statistics indicate that more than
one billion animals may have been killed.
To address the continually spreading re, employees of Komatsu Australia took volunteer
leave to participate in volunteer re extinguishing groups or support their local
community. They drove tanker trucks and delivered relief aid, taking several days to reachField turned red by rethe aected areas, built berms to prevent res from spreading, and participated incontrolled burns of elds, also to prevent the spread of the res. They worked actively
together with the local population.

Establishing an Emergency Support System in the Areas A ected by
Natural Disasters in Chile
Northern Chile, the home to many world-class mines, is frequently aected by natural
disasters. During the 10 years from 2010 to 2019, it incurred serious damage from threeearthquakes, two large res, and two oods.
Komatsu Cummins Chile Ltda. (KCC), a Komatsu group company, has concluded adisaster control agreement with multiple freight companies and construction equipment
operator stang companies so that they can not only donate money to aected areas
and dispatch employees as volunteers, but also provide support instantaneously through Transporting vehicles to the site instantaneously
their main business line in the event of disaster. If a disaster occurs, KCC will pay the rental and maintenance costs for construction
equipment used in the recovery and reconstruction. The freight companies that have entered into agreements with them will transport
vehicles to the aected areas, and the operator stang companies will conduct on-site work.
When a heavy rain disaster occurred in northern Chile in January 2020, they lent 320 wheel loaders to the aected area in two days for
emergency relief.

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Disaster Relief

Support for Reconstruction in Areas A ected by Natural Disasters in
Japan
In Japan, Komatsu has mainly assisted in areas aected byearthquakes. For wind and ood damage, which have increased inrecent years, the damage is concentrated in limited areas orvillages in many cases, and thus, we could not provide assistancein a more detailed manner in some cases. During Typhoon Hagibisthat crossed Japan in October of 2019, many rivers ooded andthere were successive mudslides in several places in Japan. Morethan 90 thousand houses were aected around the nation.
Komatsu provided 10 million yen in support, including supplying
equipment and materials.
Donating a used PC30MR to OPENJAPANWashed-out rivers were surveyed with drones for free in cooperation with local governments
By request from the local government, we used drones to survey the washed-out areas of the Iruma River in Saitama prefecture for free.
Drone surveys enable the survey to approach dangerous aected sites to understand their situation quickly, which also leads to prompt
restoration work.

Support for OPENJAPAN, a Construction Skill NPO Providing Grassroots Support in A ected
Areas
OPENJAPAN (head oce: Miyagi prefecture) is a group of volunteers who have expertise in construction and civil engineering. They
quickly rush to aected areas around Japan to clean up aected houses as well as conduct recovery and reconstruction work. Thoughmany of the volunteers possess a great deal of skill to operate construction vehicles, recovery from disasters also requires the relevant
expertise. Through daily training, they aim to carry out safe and eective recovery and reconstruction operations.
This time, by request from the Marumori-machi government in Miyagi prefecture, which was signicantly aected by Typhoon Hagibis,
and after hearing from the people on-site about their needs, Komatsu donated a used PC30MR mini shovel, as well as money for therental of heavy equipment, fuel, and materials (e.g. blue tarps and crane tools) that were necessary for the OPENJAPAN activities inMarumori-machi so that they can be used for not only the reconstruction support activities in Marumori-machi, but also future training.

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Clearing Anti-Personnel Landmines and Community Development Support

Clearing Anti-Personnel Landmines and Community
Development Support

Since 2008, Komatsu has been engaging in collaborative e orts with the Japan Mine Action Service (JMAS) to support the demining ofanti-personnel landmines. In addition to removing mines, we also provide reconstruction work as part of a community development
project. Through the technical expertise and manufacturing knowledge we have gained through our business operations, ourmachine that excel in demining and reconstruction work have been playing important roles.
Our target is to transform landmine infested lands to safe lands, and further on to lands with value by constructing roads and facilities.
Going forward, we will continue to promote activities that contribute to the recovery of the entire regions utili+ing our construction
machinery, which is Komatsu's main business.

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Clearing Anti-Personnel Landmines and Community Development Support

DATA

Results of Demining and Reconstruction Support Activities in Cambodia (Cumulative)
Item

Result (Cumulative otal y Y2019)

Demined area

2,317haTotal removal count

2,225landmines

Road construction / maintenance76.2kmSchools constructed

9 (which holds about 700 school children)

Ponds constructed

47

Mine eld in Cambodia

Landmine blast procedure

Community development through road building

Elementary school built on a demined site214

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Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Clearing Anti-Personnel Landmines and Community Development Support

We started support of unexploded bomb disposal activities in 2016 in Laos.
In Laos, more than 30% of the land is riddled with unexploded bombs, many of which are cluster sub-munitions.
This is a problem on a massive scale, with children and farmers suering bomb-related injuries on a yearly basis.
Komatsu plays its part by oering the necessary machine to UXO-LAO (a Lao unexploded bomb disposal squad) and the Japan Mine
Action Service (JMAS) free of charge, alongside engineering support for the machines it provides.
Following the success of the demining machine for anti-personnel landmines we have used Komatsu's past experiences and techniques
to develop removal machines for processing unexploded ordnance based on hydraulic excavator PC130-8, and continue the disposal
activities.

DATA

Results of unexploded ordnance removal in Laos (cumulative total)
Item

Result (Cumulative otal y Y2019)

Demined area

369ha

Total removal count3,849 bombs

Schools constructed

1 (which holds about 70 school children)

Komatsu's Demining Machine

Opening of the rst school

As part of the "Visiting Lecture" initiative, Komatsu employees visit schools in Japan and introduce these activities to a wide range ofstudents from elementary to university levels. As of today, we have carried out lectures for about 6,700 students over a total of
75 times.
We had the pleasure of providing a “Visiting Lecture" to students in their nal year at a junior high school. One of the students had thisto say: "I felt it was great that you improved conventional equipment and are using it to help countries that have landmine problems.
Building schools for elementary students in that area also helps the country. I would like to be a person who can think of ideas like thisin the future. I want to learn about what is happing in the world to become a person like that." Through this initiatives, Komatsu
continues to nurture children, giving them opportunities to consider their future and ways of living.

215

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Clearing Anti-Personnel Landmines and Community Development Support

Letter from a student in their nal year at a junior high school after a visiting lecture

Scene of a visiting lecture at a junior high school 1

Scene of a visiting lecture at a junior high school 2

TOPICS

Commencing the Cambodian Agriculture CSR Project
In a new initiative that began in 2019, we have started the trial use of construction machine for agricultural purposes on sites after
landmines have been removed, aiming to reconstruct agricultural land and provide a boost to the industry. Agriculture is one of themain industries in Cambodia, accounting for approx. 25% of GDP, and rice is actively cultivated all over the country. With help from the
JMAS, Komatsu is conducting activities to improve work eciency and yields in cooperation with the provincial government. We arevalidating the viability of operations using bulldozers, wheel loaders, and hydraulic shovels.

216

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Management ofEnvironmental andSocial Initiatives

Contents

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

History of Demining Activities (International Treaties, Japanese government and Komatsu)

Reconstructing agricultural lands after demining

History of Demining Activities (International Treaties,
Japanese government and Komatsu)
Year

Activity (international treaties and activities of the aanese overnment are nderlined)

1998

Komatsu develops old timber removal machine for demining in Cambodia

1999

The Ottawa Treaty is enacted (the Mine Ban Convention)

2002

The Japanese government states it would exclude antipersonnel demining machine from the Three Principles on Arms
Exports

2003

A subsidi5ed project by the Ministry of Economy, Trade and Industry and NEDO(*) develops demining machine (Figure (1)below)

2004

With support from the Ministry of Foreign Aairs of Japan, Komatsu conducts on-site testing in Afghanistan

2006

With support from the Ministry of Foreign Aairs of Japan, Komatsu conducts on-site testing in Cambodia

2007

The rst machine is introduced in Afghanistan (Japanese government ODA)

2008

Komatsu begins the Cambodia reconstruction project jointly with the JMAS, an incorporated NPO

2009

Komatsu begins the Angola reconstruction project jointly with the JMAS, an incorporated NPO

2010

The Oslo Treaty is enacted (the treaty banning Cluster Munitions)217

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Management ofEnvironmental andSocial Initiatives

Contents

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

History of Demining Activities (International Treaties, Japanese government and Komatsu)

Year

Activity (international treaties and activities of the aanese overnment are nderlined)

2015

Komatsu develops demining machine (Figure (2) below)

2016

Komatsu begins the Laos reconstruction project jointly with the JMAS, an incorporated NPO

2017

Komatsu completes the Angola reconstruction project

2019

Komatsu constructs its 9th elementary school in Cambodia, and 1st in Laos.

2020

Komatsu begins the agriculture CSR project in Cambodia
The Cambodia and Laos reconstruction projects are continuing（＊NEDO：New Energy and Industrial Technology Development Organization）(1) Demining Machine(2) Demining Machine for processing unexploded ordnance218

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Promoting Sports̶The Komatsu Women's Judo Club

Promoting Sports—The Komatsu Women's Judo ClubFounded in 1991 as part of social contribution activities during the 70th anniversary of the company founding, the Komatsu Women's
Judo Club is celebrating its 29th year. Since its establishment, a total of 89 athletes have participated in competitions worldwide. The
club has actively engaged in teaching judo at home and abroad, and in welcoming foreign judo competitors, with the goal to develop
and populari0e this sport.

Results of Club Activities in FY2019
The 2019 World Judo Championships in Tokyo was held at the Nippon Budokan. Four athletes from the Komatsu Women's Judo Club
participated in this preliminary event for the Tokyo 2020 Olympic Games. Tsukasa Yoshida (57 kg weight class), who won gold at the2018 World Judo Championships in Baku, looked to win the championship for the second consecutive year. However, she was narrowly
defeated by Christa Deguchi of Canada, in the nal round, nishing with silver.

Tsukasa Yoshida (57 kg weight class) won silver

Yoshida boldly attacking her opponent

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Promoting Sports̶The Komatsu Women's Judo Club

Miku Tashiro (63 kg weight class) again competed against her rival Clarisse Agbegnenou of France. The two had previously battled in thenal round of last year's World Judo Championships. Neither athletes oence or defense ceded an inch as they struggled for the longcherished gold medal. Sadly, Tashiro lost the over 11-minute-long death match, taking home the silver medal. However, the match wasa big step forward for her, as she sets her eyes on Olympic gold.

Both athletes celebrating each other after the match

Miku Tashiro (63 kg weight class) won the silver medal

On the last day of the world championships, Yoko Ono (70 kg weight class) and Tsukasa Yoshida (57 kg weight class), as they did lastyear, participated in the mixed team event, which will be a new Olympic event, and won the gold medal, leading the Japanese team totheir third consecutive victory.

Nippon Budokan lled with excitement by the great eorts of the Japanese
athletes

A third consecutive victory achieved in the mixed team event, a new
Olympic event.

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Promoting Sports̶The Komatsu Women's Judo Club

Prime Minister Shinzo Abe praises the winning Japanese team. Yoko Ono(70 kg weight class) holding the trophy

Komatsu cheering group at the Nippon Budokan

In addition, Komatsu employees rushed to cheer on our representatives from countries around the world, such as France, Germany,
Russia and China. In Tokyo, Fukuoka, Hyogo and Chiba, employees and their families from neighboring factories and sales oces
within the area joined the cheering. Our support, which is worldwide, is helping not only to promote judo but also to strengthen a senseof corporate unity (global teamwork).
You can see details of the tournament records, player pro les, and more.
Komatsu Women’s Judo Club

Social Contribution Activities through JudoThe Komatsu Women’s Judo Club has continued to coach the Komatsu Kids Judo Club in Tokyo, while also directing and coaching judoclasses around the world, including Japan, aiming to popularize this sport and train the next generation of judoka. In FY2019, judoclasses continued to be held mainly in areas where Komatsu production sites are located. In Japan, judo class was held at Komatsu
NTC Ltd.'s Plant Fair for the rst time in the Hokuriku region, enabling both children with judo experience and children who werebeginners to participate. One class in Yaroslavl, Russia, was held for the ninth consecutive year, with about 150 participants, mainly
children aged from 6 to 15 years old.
Number ofParticipants

Month

Place

July

Chicago (United States)

150

SeptemberYaroslavl (Russia)

150

September

Koriyama (Fukushima)

40

September

Komatsu NTC (Toyama)

30

Judo class in Yaroslavl

221

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Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

Index

223

GRI STANDARDS INDEX

237

SASB Content Index

222

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Management ofEnvironmental andSocial Initiatives

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Index

GRI STANDARDS INDEXThe ESG Databook 2019 references "GRI Sustainability Reporting Standards".

100 series (Universal)
Aspects

Indicators

Description

Reference

Organi7ational
Pro le102-1

Name of theorgani7ation

Company Info: Corporate Pro le102-2

Activities, brands,
products, andservices

Company Info: Corporate Pro leCompany Info, Products and Applications
Company Info, Technology and Innovation

102-3

Location of
headquarters

Company Info: Corporate Pro le102-4

Location ofoperations

Company Info, Global Operations

102-5

Ownership and legal
form

Company Info: Corporate Pro le102-6Markets served

Company Info, Global Operations

102-7

Scale of theorgani7ation

Company Info: Corporate Pro le102-8

Information on
employees and otherworkers

ESG Databook: Personnel Policy and Performance Appraisal
System102-9

Supply chain

ESG Databook: Outline of Procurement Policy and Supply Chain

102-10Signi cant changes tothe organi7ation andits supply chain(None for FY2019)223

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Management ofEnvironmental andSocial Initiatives

Aspects

Theme 1 :Enhancing
Quality of Life

Indicators

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Description

Reference

102-11

Precautionary
Principle or approach

Investor Relations: Corporate Governance
ESG Databook: Risk Management
ESG Databook: Compliance
ESG Databook: Promoting Legal Compliance, and Pollution
Mitigation and Prevention
ESG Databook: Management of Chemical Substances and Pollution
Prevention

102-12External initiatives

ESG Databook: External Evaluations(3) Endorsement of initiatives

102-13

Membership ofassociations-

102-14

Statement fromsenior decision-maker

KOMATSU REPORT: Message from the PresidentPDF
Investor Relations: President interview

102-15Key impacts, risks,and opportunities

ESG Databook: Risk Management102-16

Values, principles,standards, and normsof behavior

Company Info, Komatsu's Worldwide Code of Business Conduct
ESG Databook: Compliance
ESG Databook: The KOMATSU Way

102-17

Mechanisms foradvice and concerns
about ethics

ESG Databook: Compliance

Governance structure

Investor Relations: Corporate Governance
KOMATSU REPORT: Corporate GovernancePDF
ESG Databook: Organi8ation to Promote CSR
ESG Databook: Organi8ational Chart of the Environmental
Management Structure102-19Delegating authority

ESG Databook: Organi8ation to Promote CSR
ESG Databook: Organi8ational Chart of the Environmental
Management Structure102-20Executive-level
responsibility foreconomic,
environmental, andsocial topics

ESG Databook: Organi8ation to Promote CSR
ESG Databook: Organi8ational Chart of the Environmental
Management Structure

Strategy

Ethics andIntegrity

Governance102-18224

Index

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Aspects

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Indicators

Description

102-21

Consulting
stakeholders on
economic,
environmental, andsocial topics

ESG Databook: Organi8ation to Promote CSR
ESG Databook: Dialogue with Our Stakeholders

102-22Composition of thehighest governancebody and its
committees

Company Info: Directors, Auditors and Ocers
KOMATSU REPORT: Corporate GovernancePDF
Investor Relations: Corporate Governance102-23Chair of the highest
governance body

Company Info: Directors, Auditors and Ocers
Investor Relations: Corporate Governance102-24

Nominating andselecting the highest
governance body

Corporate Governance ReportPDF
Results of the Exercise of Voting Rights(Extraordinary Report)PDF

102-25Conicts of interest

Company Info, Komatsu's Worldwide Code of Business Conduct
KOMATSU REPORT: Corporate GovernancePDF

102-26

Role of highest
governance body insetting purpose,values, and strategy

ESG Databook: Organi8ation to Promote CSR

102-27

Collective knowledgeof highest governancebody

ESG Databook: Organi8ation to Promote CSR

102-28

Evaluating the highest
governance body's
performance

Corporate Governance ReportPDF

102-29Identifying andmanaging economic,
environmental, andsocial impacts

ESG Databook: Formulating CSR Themes (Materiality)

102-30Eectiveness of risk
management
processes

ESG Databook: Risk Management102-31

Review of economic,
environmental, andsocial topics

ESG Databook: Risk Management

Index

Reference225

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Aspects

Stakeholder
Engagement

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

SocialContribution
Activities

Indicators

Description

102-32Highest governancebody’s role insustainability
reporting

ESG Databook: Organi4ation to Promote CSR

102-33

Communicating
critical concerns

ESG Databook: Risk Management102-34Nature and total
number of criticalconcerns-102-35

Remuneration
policies

Annual Securities Report : CompensationPDF

102-36

Process fordetermining
remuneration

Annual Securities Report : CompensationPDF

102-37

Stakeholders’involvement inremuneration-

102-38Annual totalcompensation ratio-

102-39Percentage increasein annual totalcompensation ratio-

102-40

List of stakeholder
groupsESG Databook: Dialogue with Our Stakeholders

102-41

Collective bargaining
agreements

ESG Databook: Personnel Policy and Performance Appraisal
System102-42

Identifying andselecting stakeholders

102-43

Approach to
stakeholder
engagement102-44

Key topics andconcerns raised

Index

Reference

ESG Databook: Dialogue with Our Stakeholders

226

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Contents

Management ofEnvironmental andSocial Initiatives

Aspects

Reporting
Practice

Report ProleManagement
Approach

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Indicators

Description

102-45

Entities included in
the consolidated
nancial statements

Annual Securities Report: Overview of Subsidiaries andAliatesPDF
Company Info, Subsidiaries and Aliates

102-46Dening reportcontent and topic
Boundaries

ESG Databook: Formulating CSR Themes (Materiality)

102-47

List of material topics

102-48

Restatements of
information-

102-49Changes in reporting-

102-50

Reporting period

102-51

Date of most recent
report102-52

Reporting cycle

102-53

Contact point forquestions regarding
the report102-54Claims of reporting inaccordance with the
GRI Standards

102-55

GRI content index

GRI STANDARDS INDEX

102-56External assurance

ESG Databook: Independent Practitioner's Assurance

103-1

Explanation of thematerial topic and its
Boundary

ESG Databook: Formulating CSR Themes (Materiality)

103-2

The management
approach and its
components

ESG Databook: Formulating CSR Themes (Materiality)

103-3

Evaluation of the
management
approach

ESG Databook: Formulating CSR Themes (Materiality)

Index

Reference

ESG Databook: Editorial Policy

ESG Databook: Editorial Policy
Contact for Other Inquiries-

227

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

200 series (Economic topics)
Aspects

Economic
Performance

Indicators

Description

Reference

201-1

Direct economic value
generated anddistributed

ESG Databook: Personnel Policy and Performance Appraisal
System (remuneration data)
ESG Databook: Enhancing Work-Life Balance (Work-Life Balance
Data)
Annual Securities Report: Income TaxesPDF
ESG Databook: Developing People Needed by the Community
ESG Databook: Initiatives for Social Issues
ESG Databook: Disaster Relief

201-2

Financial implications
and other risks andopportunities due toclimate change

ESG Databook: Mitigating Climate Change through Products andServices
ESG Databook: Initiatives to Mitigate Climate Change in Business
Operations

201-3

De ned bene t plan
obligations and otherretirement plans

Annual Securities Report: Pension and Retirement Bene tsPDF

201-4

Financial assistancereceived fromgovernment

-

202-1

Ratios of standard
entry level wage by
gender compared to
local minimum wage

-

202-2

Proportion of senior
management hiredfrom the local
community

ESG Databook: Diversity Initiatives

203-1

Infrastructure
investments andservices supported

ESG Databook: Initiatives for Social Issues
ESG Databook: Disaster Relief

Signi cant indirect
economic impacts

SMARTCONSTRUCTION
Investor Relations: President interview
ESG Databook: Developing People Needed by the Community
ESG Databook: Initiatives for Social Issues
ESG Databook: Disaster Relief

MarketPresence

Indirect
Economic
Impacts

203-2

228

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Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Aspects

Indicators

Description

Reference

Procurement
Practices

204-1

Proportion of
spending on local
suppliers

ESG Databook: Outline of Procurement Policy and Supply Chain

205-1

Operations assessed
for risks related tocorruption

-

205-2

Communication andtraining about anticorruption policies
and procedures

ESG Databook: Compliance

205-3

Conrmed incidentsof corruption andactions taken

ESG Databook: Compliance

206-1

Legal actions for anticompetitive behavior,anti-trust, andmonopoly practices

Anticorruption

Anticompetitive
Behavior

Index-

300 series (Environmental topics)
Aspects

Materials

EnergyIndicators

Description

Reference

301-1

Materials used byweight or volume

ESG Databook: Relationship between Business Activities and theEnvironment (Input and Output)

301-2

Recycled input
materials used

ESG Databook: Activities to Eectively Utili/e Resources in
Production

301-3

Reclaimed products
and their packaging
materials

ESG Databook: Activities to Eectively Utili/e Resources in
Production

302-1

Energy consumption
within theorgani/ation

ESG Databook: Relationship between Business Activities and theEnvironment (Input and Output)
Scope of Environmental Data, etc

302-2

Energy consumption
outside of theorgani/ation-

229

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Management ofEnvironmental andSocial Initiatives

Aspects

Water andEuents

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Indicators

Description

302-3

Energy intensity

ESG Databook, Site Data
ESG Databook, Input/Output

302-4

Reduction of energy
consumption

ESG Databook, Site Data
ESG Databook, Input/Output

302-5

Reductions in energy
requirements ofproducts and services

ESG Databook: Reduction in CO2 Emissions of Construction
Equipment

303-1

Interactions withwater as a sharedresource

ESG Databook, Eorts regarding water

303-2

Management of water
discharge-related
impacts

ESG Databook, Eorts regarding water

303-3

Water withdrawal

303-4

Water discharge

ESG Databook, Eorts regarding water

303-5

Water consumption

ESG Databook, Input/Output

304-1

Operational sites
owned, leased,managed in, or
adjacent to, protectedareas and areas ofhigh biodiversity
value outside
protected areas

-

304-2

Signicant impacts ofactivities, products,
and services on
biodiversity

-

304-3

Habitats protected or
restored-

BIODIVERSITY

Index

Reference

ESG Databook, Environmental Impact
ESG Databook, Eorts regarding water230

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Aspects

EMISSIONSEFFLUENTS AND
WASTE

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Indicators

Description

Reference

304-4

IUCN Red List species
and national
conservation list
species with habitats
in areas aected byoperations

-

305-1

Direct (Scope 1) GHG
emissionsESG Databook, Environmental Impact
ESG Databook, Calculation base305-2

Energy indirect(Scope 2) GHG
emissionsESG Databook, Environmental Impact
ESG Databook, Calculation base305-3

Other indirect (Scope
3) GHG emissions

Amount of CO2 Emissions by Scope 3
Amount of CO2 Emissions by Scope3
Scope of Environmental Data, etc

305-4

GHG emissions
intensity

ESG Databook: Initiatives to Mitigate Climate Change in Business
Operations

305-5

Reduction of GHG
emissions

-

305-6

Emissions of ozonedepleting substances
(ODS)

-

305-7

Nitrogen oxides(NOX), sulfur oxides(SOX), and othersignicant air
emissionsESG Databook: Relationship between Business Activities and theEnvironment (Input and Output)
Scope of Environmental Data, etc

306-1

Water discharge by
quality anddestination

ESG Databook: Site Data

306-2

Waste by type anddisposal method

-

306-3

Signicant spills

-

306-4

Transport ofhazardous waste

-

231

Index

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Aspects

ENVIRONMENTALCOMPLIANCE

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleTheme 1 :Enhancing
Quality of Life

Data

Indicators

Description

Reference

306-5

Water bodies aectedby water discharges
and/or runo

-

307-1

Non-compliance withenvironmental laws
and regulations

308-1

New suppliers thatwere screened using
environmental
criteria-

308-2

Negativeenvironmental
impacts in the supply
chain and actions
taken

-

SUPPLIER
ENVIRONMENTAL

SocialContribution
Activities

Index

ESG Databook: Environmental Risk Management

400 series (Social topics)
Aspects

Employment

Labor/
Management
RelationsIndicators

Description

Reference

401-1

New employee hires
and employee
turnoverESG Databook: Personnel Policy and Performance Appraisal
System (Data on employment and turnover)

401-2

Benets provided tofull-time employeesthat are not provided
to temporary or parttime employees

-

401-3

Parental leave

402-1

Minimum notice
periods regarding
operational changes

ESG Databook: Enhancing Work-Life Balance (Data on pregnancy
and childcare leaves)-232

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Management ofEnvironmental andSocial Initiatives

Aspects

Occupational
Health and
SafetyTraining and
Education

Diversity and
Equal
Opportunity

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Indicators

Description

403-1

Workers
representation informal joint
management-worker
health and safetycommittees

403-2

Types of injury andrates of injury,
occupational
diseases, lost days,
and absenteeism, andnumber of workrelated fatalities

403-3

Workers with highincidence or high riskof diseases related totheir occupation

403-4

Health and safety
topics covered informal agreementswith trade unions

ESG Databook: Occupational Safety and Health404-1

Average hours of
training per year per
employee

ESG Databook: Employee Training Structure (Data on employee
training)

404-2

Programs for
upgrading employee
skills and transition
assistance programs

ESG Databook: Employee Training Structure
ESG Databook: Strengthening Our Gemba Capability
ESG Databook: Diversity Initiatives (Rehiring of Retired Employees)

404-3

Percentage of
employees receiving
regular performanceand careerdevelopment reviews

ESG Databook: Personnel Policy and Performance Appraisal
System405-1

Diversity of
governance bodies
and employees

ESG Databook: Diversity Initiatives

405-2

Ratio of basic salaryand remuneration of
women to men

-

Index

Reference

ESG Databook: Occupational Safety and Health-233

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Contents

Management ofEnvironmental andSocial Initiatives

Aspects

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Indicators

Description

Reference

406-1

Incidents of
discrimination andcorrective actions
taken

-

407-1

Operations andsuppliers in which theright to freedom of
association andcollective bargaining
may be at risk

ESG Databook: Personnel Policy and Performance Appraisal
System (Data on employment and turnover)

408-1

Operations andsuppliers at
signi cant risk forincidents of childlaborCompany Info, Komatsu's Worldwide Code of Business Conduct
ESG Databook: CSR Procurement Guidelines

409-1

Operations andsuppliers at
signi cant risk forincidents of forced orcompulsory labor

Company Info, Komatsu's Worldwide Code of Business Conduct
ESG Databook: CSR Procurement Guidelines

Security
Practices

410-1

Security personnel
trained in humanrights policies orprocedures-

Rights ofIndigenous
Peoples411-1

Incidents of violations
involving rights ofindigenous peoples

-

412-1

Operations that havebeen subject tohuman rights reviews
or impactassessments

ESG Databook: Risk Management
ESG Databook: CSR Procurement Guidelines

412-2

Employee training on
human rights policies
or procedures

ESG Databook: ComplianceNondiscrimination
Freedom of
Association
and Collective
Bargaining

Child Labor

Forced orCompulsory
Labor

Human Rights
Assessment

234

Index

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Aspects

Data

SocialContribution
Activities

Description

412-3

Signi cant investment
agreements andcontracts that include
human rights clausesor that underwent
human rights
screening

ESG Databook: CSR Procurement Guidelines

413-1

Operations with local
community
engagement, impact
assessments, anddevelopment
programs

ESG Databook: Developing People Needed by the Community
ESG Databook: Initiatives for Social Issues
ESG Databook: Disaster Relief

413-2

Operations withsigni cant actual andpotential negative
impacts on local
communities

ESG Databook: Developing People Needed by the Community

414-1

New suppliers thatwere screened usingsocial criteria

ESG Databook: Komatsu Group's Supply Chain Management andPromotion of CSR Procurement

414-2

Negative social
impacts in the supply
chain and actions
taken

-

415-1

Political contributions

Political Contributions

416-1

Assessment of thehealth and safety
impacts of productand service categories

ESG Databook: Improving Product Safety and Solutions

416-2

Incidents of noncomplianceconcerning the healthand safety impacts ofproducts and services

-

417-1

Requirements for
product and service
information andlabeling-

Supplier Social
Assessment

Customer
Health and
SafetyMarketing andLabeling

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleIndicators

Local
Communities

Public Policy

Theme 1 :Enhancing
Quality of Life

Index

Reference

235

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Aspects

CustomerPrivacy

Socioeconomic
Compliance

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

Indicators

Description

Reference

417-2

Incidents of noncomplianceconcerning productand service
information andlabeling-

417-3

Incidents of noncomplianceconcerning marketing
communications

-

418-1

Substantiatedcomplaints
concerning breachesof customer privacy
and losses ofcustomer data

-

419-1

Non-compliance withlaws and regulationsin the social andeconomic area-

236

SocialContribution
Activities

Index

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Index

SASB Content Index
Topic

EnergyManagement

Employee Health& Safety

Accounting Metric

Reference(1) Total energy consumed

Environmental Impact Resulting from
Business Activities(2) Percentage gridelectricity

Environmental Impact Resulting from
Business Activities(3) Percentage renewable

Reducing CO2 Emissions in Manufacturing
Operations(1) Total recordable incident rate (TRIR)

Occupational Safety and Health(2) Employee fatality rate

Occupational Safety and Health(3) Near miss frequency rate (NMFR)

Code

RT-IG-130a.1

RT-IG-320a.1-(1) Sales-weighted eet fuel eciency formedium- and heavy-duty vehicles

Out of scope

RT-IG-410a.1(2) Sales-weighted fuel eciency for nonroad equipment

Reducing CO2 Emissions from ProductOperation

RT-IG-410a.2(3) Sales-weighted fuel eciency forstationary generators

Out of scope

RT-IG-410a.3

NOx、PM Sales-weighted emissions of: (1)nitrogen oxides (NOx) and (2) particulatematter (PM) for: (a) marine diesel engines,(b) locomotive diesel engines, (c) on-road
medium- and heavy-duty engines, and (d)other non-road diesel engines

NOx and PM Emitted from Products

RT-IG-410a.4

Materials
Sourcing

Description of the management of risks
associated with the use of criticalmaterials

Eective Use of Critical Materials in
Products

RT-IG-440a.1

Remanufacturing
Design &Services

Revenue from remanufactured products
and remanufacturing services

Development of our “Reman”
Remanufacturing Business

RT-IG-440b.1

Fuel Economy &Emissions in Usephase

237

ESG Databook 2020

Contents

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 3 :Growingwith Society

Theme 2 :Developing
PeopleData

SocialContribution
Activities

Topic

Accounting Metric

Reference

Code

Activity Metric

Number of units produced by productcategory

Environmental Impact Resulting from
Business Activities

RT-IG-000.A

Number of employees

Corporate Pro le

RT-IG-000.B

238

Index

ESG Databook 2020

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