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CSRダイジェスト 2013

DIGEST

Komatsu Ltd.
CSR Department
2-3-6, Akasaka, Minato-ku, Tokyo
107-8414, Japan
http://www.komatsu.com/CompanyInfo/csr/

TEL: +81-3-5561-2799
FAX: +81-3-3505-9662

HECR130930

Printed in Japan

2013

Contents
Message from Top Management………………………………………………………………………… 02

Our Approach to CSR
CSR Theme Formulation Process………………………………………………………………………… 03
Organization Related to CSR……………………………………………………………………………… 04

Message from Top Management

Committed to Work for Society through Core
Businesses

Incorporating CSR Into Management…………………………………………………………………… 04
CSR Themes and Initiatives……………………………………………………………………………… 05
Komatsu and Global Principles…………………………………………………………………………… 06
External Commendations and Evaluations……………………………………………………………… 08
CSR Themes ❶CSR Themes ❷Enhancing Quality of Life ─ Providing Products Required by Society ─Working for Society through Core Businesses………………………………………………………… 09

equipment to obtain commodities, and forest machines needed to produce lumber and pulp, we are helping

Improving Productivity, Safety and Efficiency through the Use of ICT………………………………… 10

people improve their lives around the world. In the course of our business operation, we foster the growth ofRelationship with the Environment………………………………………………………………………… 11

local people with maintenance skills for our machines, thereby contributing to the vitalization of local human

Komatsu Earth Environment Charter…………………………………………………………………… 12

resources and communities. Therefore, I believe our business on a global scale itself represents CSR efforts.

Power-Saving Activities…………………………………………………………………………………… 13

Under the growth strategies based on innovation in the new mid-range management plan, we are going toEnhanced Safety…………………………………………………………………………………………… 14

facilitate the development and market introduction of products which feature leading-edge ICT advantages,

Developing People

such as Machine Control/Guidance construction equipment designed to streamline and eventually automate
construction jobsites, Autonomous Haulage System which contributes to improved safety and yields, andCommunity Based Human Resource Development…………………………………………………… 15

fleet control systems for forest machines. Through these efforts, we are determined to change our customers’

The Right Working Conditions for Everyone…………………………………………………………… 17

jobsites together with them and create new values through innovation. I feel this is also our big responsibility.

KOMATSU Way and Human Resource Development…………………………………………………… 18
CSR Themes ❸By providing our products and service, for example, construction equipment to develop cities, mining

Growing with Society
Reconstructing Earthquake-hit Areas…………………………………………………………………… 19
Dialogue with Our Stakeholders………………………………………………………………………… 21

When engaging in these businesses, we must make the utmost emphasis on safety as a manufacturer. Safety
is a CSR by itself, and is also our commitment to ourselves, families and all colleagues around us. Furthermore,
compliance is our commitment to local communities, and quality is our commitment to customers. Without
these three commitments, I believe no company can exist. I would like to manage Komatsu for sustainablegrowth, as we make progress in business while fulfilling these responsibilities.

Initiative for CSR Procurement…………………………………………………………………………… 22
Frameworks for Promoting Compliance………………………………………………………………… 23
Risk Management………………………………………………………………………………………… 24
Corporate Governance…………………………………………………………………………………… 25
Project for Creating Safe Villages………………………………………………………………………… 27
Major CSR Activities to Date……………………………………………………………………………… 28
Corporate Information……………………………………………………………………………………… 29

Tetsuji Ohashi
President and CEO

Editorial Policy
・The “CSR Digest 2013” is an abridged report of our initiatives relating to three CSR themes, and is basedon the “Komatsu Report 2013”.
・In each theme, we presented the main initiatives or a representative activity.
・“Komatsu Report” and this “CSR Digest” can be viewed in PDF format on our website. Our website also
provides: (1)general information, such as policies and general rules, (2)information on ongoing activities
and initiatives, and (3)a comprehensive disclosure of details and related information.
(Komatsu CSR on Web http://www.komatsu.com/CompanyInfo/csr)

We support the
Global Compact Initiative.

・This report principally covers data for the period from April 2012 to the end of March 2013, with some
information from after April 2013.
・Subsequent Reporting Schedule : Expected July 2014

01 CSR Digest 2013

CSR Digest 201302

0ur Approach to CSR

We have structured our organization to ensure that CSR is integral to
how we conduct our daily business throughout our entire operations.
Our CSR organization reports to the president and CEO of Komatsu. In

addition, our CSR Department, with the support of the CSR Committeethat includes senior leaders from across the company, plans andguides our day-to-day CSR activities.

Organization

Committee

Our Approach to CSR

Organization Related to CSR

Area of CSR Oversight

Executive Ofﬁcer Supervising CSR

CSR Theme Formulation Process

CSR Steering Committee

Overall CSR
Social Contribution

Environmental Affairs Dept.

Earth Environment Committee

Environment

Compliance Dept.

Compliance Committee

Compliance

KOMATSU Way Global InstituteKomatsu Way Committee

Developing Human Resources

Risk Management Committee

Risk Management

President
and CEOInternal Audit Dept.
General Affairs Dept.

Internal Auditing
Information Security Committee

Selecting CSR Priorities ・・・・・・・・・・・・・・・・・■ Our CSR Priorities
Environment

Products that enhance safety

Environmentally-friendly products

Responsible marketing andcustomer care

Environmental efficiency (facilities,
such as plants, and job sites)

Employees

Remanufacturing

Human resource development

Human Rights

Safety and healthRespecting human rights

Respecting employees

Equal employment

Ethics and Governance

Local Community

Cooperation with stakeholders

Development of local communities

Corporate governance and complianceDisaster relief

Compliance with social norms ofbusiness partners

Improving local residents' quality oflife

Komatsu's CSR Themes and Key Business
Activities ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・
After discussions internally and with BSR regarding CSR priorities,
we defined three CSR themes that could be shared on a global level.
Based on the current Mid-Range Management Plan, key CSR activities
relating to the CSR themes were also identified.

03 CSR Digest 2013

1. Enhancing Quality of Life ─ Providing products required by society ─

Export Control Dept.

Export Control Committee

Export Control

Corporate Communications Dept.

Information Disclosure Committee

Information Disclosure
Personnel System

Human Resources Dept.

Personnel Committee

Quality Assurance DivisionCorporate-level Product Safety Committee

Product Safety

Safety & Health Admin Dept.

Group Health and Safety Committee

Health and Safety――――――――――――――――――――――――――――――● Providing products and services that contribute to infrastructuredevelopment and improve quality of life
● Improving productivity, safety, and efficiency and enhancing
energy conservation through the use of Information andCommunication Technology (ICT)● Improving environmental efficiency at operation sites and facilities,
such as plants● Reducing our impact on the environment throughout the productlife cycle● Enhancing safety for society, customers, employees, andbusiness partners

Incorporating CSR Into Management
Through dialogue with stakeholders both inside and outside thecompany, we will focus on our CSR themes and further develop these

2. Developing People――――――――――――――――――――――――――――――● Contributing to human resource development in local
communities● Enhancing our employees and suppliers through The KOMATSU
Way● Enhancing our employees and distributors through "Brand
Management"

Management
PolicyBusiness
DomainEnhancing the trust
placed in us
by society→ Further growthManagement
Strategy

3. Growing with Society――――――――――――――――――――――――――――――● Engaging in dialogue with our stakeholders● Providing social contributions through the use of our coretechnologies and resources (e.g., disaster relief or activities toremove anti-personnel land mines)● Contributing to local communities where we do business● Strengthening our corporate governance and compliance● Promoting compliance with environmental, labor, and social
norms within our group and among business partners

Procurement

Procurement Div.

The KOMATSU Way

Corporate
Citizenshipthemes and key activities. In this way we hope to enhance the trust
placed in us by society as we pursue sustainable growth.

Committed to “Quality and Reliability,” Komatsu strives to maximize its corporate value
by providing products that customers are happy to own.
“Corporate value is the sum of trust given to us by all our stakeholders”
By focusing on construction and mining equipment, and industrial machinery, we will
work for sustainable growth that minimizesnegative environmental and social impacts.
Mid-range management plan “Together We Innovate GEMBA Worldwide”(1) Growth strategies based on innovation(2) Growth strategies of existing businesses(3) Structural reforms designed to reinforce the business foundation

Growing with Society

Products, Services, and Customers■ Our CSR Themes and Key Business Activities

Information Security
Compliance with Laws

Developing People

In FY 2010, Komatsu formulated CSR themes with the help of BSR(Business for Social Responsibility), a US-based NPO.
The first step of the process was to select key CSR priorities thatwould allow us to contribute through our core business. CSR issues
relevant to Komatsu's business were selected from a large numberof social issues focusing on those that are important to both to ourbusiness and to our stakeholders.

Legal Dept.

Enhancing Quality of LifeCSR Committee

CSR Dept.

Implementation ofmanagement policy→ Contributing
to society

Values, basic attitudes and patterns of behavior to be passed on to future generations.

1. To further cultivate the forward-looking corporate climate and the corporate cultureof continuously taking on challenges, we will thoroughly ensure group-wide practiceof five Gen principles,i.e., Gemba (workspace), Genbutsu (actual things), Genjitsu (reality),
Genten (the origin) and Kenzaika (making evident).
2. To anchor The KOMATSU Way, we will strengthen our Gemba capability throughKaizen activities in our routine work.
3. We will focus our efforts on brand management activities designed for us tothoroughly understand customers’ Gemba and become indispensable for customers.
(Supporting customers to achieve their ideal conditions)

Is management inline with societal
demands?
→ Always monitor

Code of Worldwide Business Conduct● Rules that Komatsu and its management and employees must abide by as a memberof the business society● Statement to society as a “responsible corporate citizen”< Policies, Standards, Principles >● 5 Principles of Compliance● Earth Environmental Charter● Declaration of Biodiversity● Global Policy of Human Resources● Occupational Safety and Health Policies ● Standards for Product Safety● Principles Governing Quality Assurance ● Basic Principles for Social Contributions● Regional Policies, Standards by Countries, etc
Komatsu’s CSR Themes
1. Enhancing Quality of Life - Providing products required by society 2. Developing People
3. Growing with Society

Demands of Society< Global Principles >● The UN Global Compact●

ISO26000

●

GRI

●

Keidanren Charter of Corporate Behavior

CSR Digest 201304

0ur Approach to CSR

Komatsu's CSR Themes, Key Activities andExamples of Concrete Initiatives

Comparative Tables with Global Principles

Examples of Komatsu's CSR themes and key activities and concrete
examples of initiatives are summarized below.

Activities, policies, etc. not included in the table below are introduced on
the Komatsu CSR website.

• Providing products and services that contribute to
infrastructure development and improve quality of life
• Improving productivity, safety, and efficiency andenhancing energy conservation through the use of ICT• Improving environmental efficiency at operation sites
and plants

2. Developing People• Contributing to human resource development in local
communities• Enhancing our employees and suppliers through The
KOMATSU Way• Enhancing our employees and distributors through"Brand Management"■ Developing human resources related to acquiring skills for servicing■ The KOMATSU Way and human resource development■ Brand Management initiatives

3. Growing with Society• Engaging in dialogues with our stakeholders• Providing social contributions through the use of ourcore technologies and resources• Contributing to local communities where we do business• Strengthening corporate governance and compliance• Promoting compliance with environmental, labor, andsocial norms within our group and among business
partners

05 CSR Digest 2013

Recognizing our responsibility as a company with business envolving■ Human Rights
The United Nations Global Compact
The Ten Principles
Principle
One

Businesses should support and respect theprotection of internationally proclaimed humanrights; andPrinciple
Twomake sure they are not complicit in humanrights abuses.

■ Labour
The United Nations Global Compact
The Ten Principles
Principle
Three

Businesses should uphold the freedom of
association and the effective recognition of theright to collective bargaining;

Principle
Fourthe elimination of all forms of forced andcompulsory labour;

Principle
Fivethe effective abolition of child labour; andPrinciple
Sixeliminate discrimination in respect of employment
and occupation.

construction equipment

・Developing human resources in Africa, China and Myanmar■ Cultivating the Next Generation
・Social Contribution Efforts in Germany, Japan and Sweden■ Communicating with stakeholders
・Dialogue with stakeholders
・Communicating with sharehoders, local society and employees.
・Communicating with business partners in the supply chain■ Disaster relief reconstruction after the Tohoku earthquake and tsunami■ Project for Creating Safe Villages■ Global social contribution programs tailored to the needs of each region
・Cultivating the Next Generation in Germany, Japan and Sweden
・Supporting the Flower Association of Japan and Promoting Sports■ Ensuring compliance by top management and all employees
・Corporate Governance・Promoting Compliance■ Initiatives that address CSR Procurement
・Establishing CSR procurement guidelines and bringing awareness to business partners
・Pursuing environmental initiatives jointly with business partners

The UN Global Compact is a voluntary code of conduct in the four areasof human rights, labor, environment, and anti-corruption promoted by
the United Nations for adoption by companies.

■ Environment
The United Nations Global Compact
The Ten Principles
Principle
Seven

Business should support a precautionary
approach to environmental challenges;

Principle
Eightundertake initiatives to promote greater
environmental responsibility; andPrinciple
Nine

encourage the development and diffusion ofenvironmentally friendly technologies.

Komatsu's Internal Guidelines■ Global Policy on Human Resources Management(Komatsu's Worldwide Code of Business Conduct 5(A))
・Respect each employee's fundamental human rights
・Achieve a balance between work and personal life
■ What we would like to ask our business partners in the supply chain(Komatsu Group CSR Procurement Guidelines (5))
・Respect human rights

Komatsu's Internal Guidelines■ Global Global Policy on Human Resources Management(Komatsu's Worldwide Code of Business Conduct 5(A))
・Conversations or discussions with employees or their representatives
・Shall not tolerate child labor or forced labor
・Promote equal opportunities for employment and eliminate discrimination/harassmentin the workplace■ Occupational Safety and Health Policies(Komatsu's Worldwide Code of Business Conduct 5(B))
・Realize a safe and comfortable work emvironment■ What we would like to ask our business partners in the supply chain(Komatsu Group CSR Procurement Guidelines (5))
・Never get involved in any child or forced labor
・Create a work environment where there is no discrimination or harassment
・Build up an occupational safety and health operational structure
・Establish a fair and just personnel system

Growing with Society• Enhancing safety for customers, society, employees,
and business partners

business units
・Energy saving project (Realizing lower energy requirements, revamping production
and alternative energy sources)
・Expanding Komatsu's energy-saving activities to suppliers・'Zero emissions' activities
・Saving water resources■ Taking measures to maintain biodiversity at business units and facilities■ Reducing CO² emissions in logistics
・Improving load efficiency and utilizing nearby ports for transport■ Promoting the "Reman" business・ Remanufacturing used components such as engines, and placing them back on
the market■ Raising the recyclability of construction equipment
・ Adopted chlorine-free hydraulic hoses (Established recycle route for disposing
hydraulic hoses)
・Achieved 99% reduction with Tier4 compliant vehicles■ Increasing the safety of products, services, and workplace
・Enhancing Quality and Reliability
・Holding training sessions for customers
・Pursuing initiatives that deal with occupational health and safety at the workplace

Relationship of Komatsu's CSR activities with
the Principles of the Global Compact ・・・・・・・

Developing People• Reducing environmental impact throughout the
product life cycle■ Construction Equipment of the next-generation utilizing ICT■ Biodiesel Fuel (BDF) Project■ Introducing environmentally-friendly products and services to the market
・Line up of Tier4 machinery・New hydraulic drive forklift 'FH Series'
・Developing the latest engine technology
・Fiber laser cutting machine and miniature servo press■ Reducing the CO ² emissions and effective utilization of resources inaround the world, Komatsu is a signatory to the
UN Global Compact.
We and our business partners will act throughour supply chain in consideration of this voluntarycode of conduct.
Each principle of GC is cross-referenced to
Komatsu's internal guidelines as following table.

Enhancing Quality of LifeCSR Themes and Key Business Activities
Examples of Concrete Initiatives
1. Enhancing Quality of Life -Providing products required by society-We believe that a corporation must continuously check whether its
business activities are aligned with the demands of society.
We bolster our CSR review cycle by adhering to regional, national,
and international guidelines and principles, such as those provided
by the UN Global Compact and the International Organization forStandardization (ISO).

Our Approach to CSR

0ur Approach to CSR

Komatsu's Internal Guidelines■Management Principles(Komatsu's Worldwide Code of Business Conduct 1)
・Provide products, services and systems that are environment-friendly, safe and innovative■Environment Protection(Komatsu's Worldwide Code of Business Conduct 6)■ Komatsu Earth Environmental Charter
・Climate Change
・Establishment of a Sound Material-Cycle Society
・Conservation of Air, Water and Other Environments as well as Management of Chemical Substances
・Biodiversity
・Framework of Global, Group-wide Environmental Management System
・Environmental Education and Communication■ Declaration of Biodiversity by Komatsu■ What we would like to ask our business partners in the supply chain(Komatsu Group CSR Procurement Guidelines (4))
・Reduce environmental impact, manage chemical substances and build up
environmental management systems

CSR Digest 201306

0ur Approach to CSR■ Anti-Corruption
The United Nations Global Compact
The Ten Principles■ Fair Operating Practices

Principle
Ten

Businesses should work against corruption in allits forms, including extortion and bribery.

Komatsu's Internal Guidelines

Relationship of Komatsu's CSR Priorities
with ISO26000 ・・・・・・・・・・・・・・・・・・・・・・・・・・
Komatsu undertook a materiality assessment with the support ofBusiness for Social Responsibility (BSR), a nonprofit organization.

・Cooperation with stakeholders
・Corporate Governance・Compliance・Compliance with social norms including business partners

Organizational Governance■ Human Rights

ISO26000
IssuesISO26000
Issues

1. Employment and employment relationships
2. Conditions of work and social protection
3. Social dialogue
4. Health and safety at work
5. Human development and training in the workplace■ The Environment

1. Fair marketing, factual and unbiased information and fair contractual practices
2. Protecting consumers' health and safety
3. Sustainable consumption
4. Consumer service, support, and complaint and dispute resolution
5. Consumer data protection and privacy
6. Access to essential services
7. Education and awareness■ Community Involvement and Development
ISO26000
Issues
1. Community involvement
2. Education and culture
3. Employment creation and skills development
4. Technology development and access
5. Wealth and income creation
6. Health
7. Social investment

Komatsu's CSR Priorities

・Products that enhance safety
・Responsible marketing and customer care・Environmental-friendly products・Remanufacturing

Komatsu's CSR Priorities

・Development of local communities
・Disaster relief
・Improving local residents' quality of life
・Human resources development

Komatsu's CSR Priorities

・Respecting human rights
・Compliance with social norms including business partners
・Development of local communities
・Disaster relief
・Improving local residents' quality of life

Recent External Commendations and
Evaluations ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・■ Recent External Commendations and Evaluations on Komatsu's
Environmental Conservation and Social Activities
2013

Komatsu's CSR Priorities
・Equal employment
・Safety and health・Human resource development
・Comliance with spcoal norms including business partners

ISO26000
IssuesKomatsu's CSR Priorities

1. Prevention of pollution
2. Sustainable resource use
3. Climate change mitigation and adaptation
4. Protection of the environment, biodiversity and restoration of natural habitats

・Environmental-friendly products
・Environmental efficiency (facilities, such as plants, and operation sites)
・Remanufacturing

07 CSR Digest 2013

ISO26000
Issues2012

January• Komatsu is ranked 19th among 438 companies in the 16th

Corporate Environmental Management Ranking by Nikkei Inc.
• Komatsu is ranked 21st among 1,116 companies in theMarch
CSR Corporate Ranking by Toyo Keizai Inc.
• Komatsu is ranked 5th among 616 companies in the Corporate
Integrity and Transparency Assessment by Integrex Inc.
• Komatsu is ranked 38th among 449 companies in the 15th
January
Corporate Environmental Management Ranking by Nikkei Inc.
• Komatsu's "CSR & Environmental Report 2011"
receives the award of excellence at the 15th Green
March
Reporting Awards, organized by the Green Reporting
Forum and Toyo Keizai Inc.
• Komatsu is ranked 19th among 1,117 companies in the
CSR Corporate Ranking by Toyo Keizai Inc.
• Komatsu is ranked 4th among 611 companies in the Corporate
Integrity and Transparency Assessment by Integrex Inc.
• Komatsu Asia & Pacific Pte Ltd. (KAP) is the Merit
Winner of the Singapore Environment Achievement
AugustAward (Manufacturing)• Komatsu is recognized by the Tokyo Stock Exchange
September as a Company Appropriately
Responding to "ESG" issues"• Komatsu is ranked 3rd among 1,020 companies according
Decemberto the "NICES" company-rating system by Nikkei Inc.

Commendations from Socially Responsible
Investing (SRI) Assessment Bodies(Globally) ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・
Selected for inclusion in the Dow
Jones Sustainability Indices(DJSI), SRI share price indexes
developed by S&P Dow Jones
Indices (U.S.) and Robeco SAM(Switzerland)

Growing with Society

1. Due diligence
2. Human rights risk situations
3. Avoidance of complicity
4. Resolving grievances
5. Discrimination and vulnerable groups
6. Civil and political rights
7. Economic, social and cultural rights
8. Fundamental principles and rights at work

■ Labour Practices

Komatsu's CSR Priorities■ Consumer Issues

・Corporate governance・Compliance
・Comliance with spcoal norms including business partners

Developing People■ Organizational Governance
ISO26000
Issues

We identified a set of CSR issues and prioritize these CSR issues
by their relevance to our business and their importance to ourstakeholders.
Komatsu's CSR priorities are cross-referenced to ISO26000 core
subjects/issues as following table.

1. Anti-corruption
2. Responsible political involvement
3. Fair competition
4. Promoting social responsibility in the value chain
5. Respect for property rights

Komatsu's CSR Priorities

Enhancing Quality of Life

■ Free and Fair Trade(Komatsu's Worldwide Code of Business Conduct 4)・Fair Competition
・Refrain from following the custom when there is conflict・Appropriate Sociality
・Fair and proper relationship with governmental agencies■ What we would like to ask our business partners in the supply chain(Komatsu Group CSR Procurement Guidelines (6))
・Engage in free and fair competition and business transactions
・Never accept inappropriate cash, gifts or other favors

ISO26000
IssuesOur Approach to CSR

0ur Approach to CSR

Selected for inclusion in thelisting of SRI issues developed by
Morningstar (Japan)
Rate d as "Pr ime" among 35
machinery companies in 2012s o c i a l re s p o n s i b i l i t y r ati n g s
by Oekom, a Germany-based
independent CSR assessment
company.

We support THE GLOBAL COMPACTCSR Digest 201308

CSR Themes ❶Enhancing Quality of Life

Enhancing Quality of Life ―Providing products required by society―

Key Activities

Improving Productivity, Safety and Efficiency
through the Use of ICT―Providing products required by society―・Providing products and services that contribute to infrastructuredevelopment and improve quality of life
・Improving productivity, safety, and efficiency and enhancing energy
conservation through the use of information and communication
technology (ICT)・Improving environmental efficiency at operation sites and plants
・Reducing environmental impact throughout the product life cycle
・Enhancing safety among society, customers, employees, andbusiness partners

The world's first Machine Control dozer withfully automatic blade control ・・・・・・・・・・・・・・

Komatsu‚ s Initiatives
・Provide high-quality construction
equipment
・Provide equipment maintenancewith out interrupting machine
operation
・Provide eco-friendly equipment
Provide optimum service
・Provide highly functional
through a remote vehicle
management
construction solutionsa
system (KOMTRAX)

Civil Engineering and Construction

Hybrid excavator that have
25% higher efficiency thanconventional vehicles➡

Solutions to Societal lssues

Automation of equipmentusing high perfoemance GPS⬇

Reduction of Construction Time

Mines
➡

Komatsu focuses on “Environment, Safety and ICT” when providing
those products and services above, striving to become a necessarypresence for our customers by fulfilling their needs. We are committed
to our mission of helping people around the world to enhance their
quality of life. Initiatives that reflect this mission are given below, as
examples of how we are meeting the needs of our civil engineering andconstruction customers.

Calculation of coordinatesfrom design drawing

3D construction data

Calculation of thecoordinates fromdraeingCalculation of thecoordinates fromdraeing

3D設計データ
3D desigin data

Worker transfers
drawing infomation
to stakes

Superior Quality in Completing
Construction

Decreasing CO2 emissions by
Improving Fuel Efficiency

Komatu’s ICT -Intensive Prosess

2D Drowing infomation

SafetyContribuuting to Local Community(Developing Safe and Heaithy Urban Environments)⬇

Helping to Enhance Quality of Lives of People Around the World

Surveying
Worker Products
positional information.

Control construction equipment
based on 3D positional informationof the blade

Surveyig

Staking
Worker operates construction
equipment by following
the stakes.
Staking

Construction
Woker suveys thelandscape shaped byconstruction equipment.

Repeated work

Business Development Focusing on“Environment, Safety and ICT”・・・・・・・・・・・

09 CSR Digest 2013

Conbentional Construction

Rough dosing

Minimunlrepetitionof work* GNSS: Global Navigation Satellite System is a general term for navigation systems,
which are developed by different countries, e.g., GPS by the United States and
GLONASS by Russian Republic.

Hydraulic Drive Forklift-Environmental-Friendly and Easy to Operate ・・・
The new forklift models FH40-1, FH45-1, and FH50-1 announced in July2012 are more environmental-friendly and easy to operate. Komatsu
has received 200 orders for these models as of March 2013. The
electronically controlled Hydro-Static Transmission (HST, hydraulics
powered transmission) technology, developed by Komatsu achieves
unprecedented fuel efficiency by reducing fuel consumption by up to
30% compared to our previous models. The new forklift models areequipped for the first time with KOMTRAX, a remote equipment andfleet monitoring system, to support our customers fleet management
operations. Trial units are currently being tested abroad in the UnitedStates, CIS, and Indonesia, with great feedback on their low fuelconsumption.

Growing with Society

Process of Komatsu,s ICT-Intensive Construction➡
ForestryThanks to the revolutionary, ongoing advancement of ICT and
GNSS technology, our industrial pace-setting dozer also enables ourcustomers to manage their jobsite conditions, such as work progress,
as it is equipped with the survey function for earthmoving work. As ourcustomers and we share our respective areas of expertise to "visualize"
their jobsite operations based on data transmitted from our Machine
Control construction equipment, we believe that in the near future wewill be able to innovate and realize ideal jobsite operations, which feature
unprecedented safety, productivity and efficiency.

ICT-intensive Bulldozer D61PXi-23

Developing People

Komatsu products, such as construction equipment and mining
equipment, help build nations and develop comfortable living
environments around the world. Construction equipment helps
implement the infrastructure for people’s livelihoods, through thebuilding of roads and commercial facilities, and the construction ofharbors and embankments.
Komatsu products are also prominent in forestry, helping to produce
pulp and lumber, and in mines that produce resources, such as metal
ore and coal.

■ Enhancing Quality of Life through Civil Engineering andConstruction Business

The built-in 3D automatic blade control of the dozer receives real-time
information of the blade position from the GNSS* and controls the blade
according to 3D CAD construction data with the coordinates computedfrom design drawings. Therefore, the operator just needs to move thedozer toward the work target displayed on the monitor panel. The restof his/her work is done by the dozer itself, automatically and seamlessly,
from rough dozing to finish grading, as if it were operated by a veteranoperator.

Enhancing Quality of LifeIn April 2013, we unveiled the world’s first Machine Control dozer
with fully automatic blade control, D61PXi-23, at the Bauma 2013
International Trade Fair in Germany.

Working for Society through Core Businesses
Contributing to Infrastructure Development
and Improving Quality of Life ・・・・・・・・・・・・

Our Approach to CSR

CSR Themes ❶In February 2013, Komatsu was awarded the Japan Machinery
Federation Chairman Award given in recognition for the development orapplication of industrial machinery with significant energy conservation
effects.

Finish qrading

Dozing according to the stakes

SurveyingUse information conserning
the remaining tracks of the blade

Komatsu provides products and services that are needed by ourcustomers and by society. The theme “Enhancing Quality of Life,” whileat the same time taking the environment and safety into account.

Finish qrading according torepeatel surueys

Management of quality
and ﬁnished shope

Management of quality
and ﬁnished shape

Management of quality
and ﬁnished shapeAs-built dataAs-built data
Refereuce a test aesult

Hydraulic Drive Forklift FH50-1

CSR Digest 201310

CSR Themes ❶Enhancing Quality of Life ―Providing products required by society―

Enhancing Quality of Life ―Providing products required by society―Pursuing Environmental Management,

Komatsu s Relationship with the Environment

Our Approach to CSR

CSR Themes ❶Pursuing Environmental Management

Komatsu Earth Environment Charter

Komatsu promotes environmentally-friendly activities throughout the entire Group to realize its vision of "What
Komatsu Can Do and What It Must Do" for the environment and sustainable development.

In recognition of the fact that our business activities affect theenvironment on a regional and global level, we, at Komatsu, haveplaced the focus on the following four key areas:

In line with the Komatsu Earth Environment Charter revised in 2010, theKomatsu Group embarks on global initiatives across business areas
guided by the fundamental principles of1) Climate Change
2) Establishment of a Sound Material-Cycle Society3) Conservation of Air, Water and Other Natural Resources as well as
Management of Chemical Substances
4) Biodiversity(1) Contributions to Realization of Sustainable Society,(2) Simultaneous Realization of Environmental and Economic
Performance, and(3) Observance of Corporate Social Responsibility.

●●

Sales and After-sales Services●

Provision of environmentally-friendly products and services
Creation and operation of a transaction network for usedcomponents (parts), information on “Reman” sales, etc.

Activities based on health and safety
and environmental guidelines
Sales andafter-sales
service agents

Komatsu
employees

CO2 reductions
in logistics
Improvement oftransport efficiency
Improvement ofpacking material

Reduction of environmental
impacts during the productusage stage

Provision of solutions forcustomers’ environmental
activities● Promotion of fuel-efficient
operation● Product support throughuse of ICT●

Sales, Rentals, andAfter-sales Services

Products

Products

Development●

Environment & Economy

Reuse of products●

LCA design
Local
Medium-term targets for community
development ofenvironmental technology

Komatsu
employees●

Reuse Reuse of parts
Reuse

Customers

ReduceBusiness
associates

Procurement ofMaterials●●

Green procurement

Mitigation of climate change(energy conservation)

Effective utilization of resources(zero emissions)
Environmental risk management● Elimination of the use ofhazardous chemical substances● Termination of use of organic
chlorinated cleaning solvents● Correspondence to biodiversity
●

●

CO2

Use
Remanufacturing of usedcomponents (parts) (“Reman” business)
Recovery
Recycling of materials(outsourcing)

Used vehicles

RecycleKomatsu
employees

Disassembly

CSR Digest 2013

ParticulatematterManufacturing

Proper disposal of waste(outsourcing)

11

NOX

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 andlocal environmental concerns. Each company of the Group also strives
to fulfill its corporate social responsibility by actively participating in local
environmental conservation programs and thereby promoting closeknit communication with local communities, while striving to become acompany trusted by all Komatsu stakeholders.

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 thefollowing 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

2. Framework of Global, Group-wide Environmental
Management System
The Komatsu Head Office, as well as the manufacturing facilities andmain companies of the Komatsu Group, already with ISO certifications,will work to maintain and improve their environmental management
system, while other manufacturing facilities and suppliers will also workto establish their environmental management systems and reduce theirenvironmental impact.
The Komatsu Environmental Committee develops environmental
action plans and common guidelines for the Komatsu Group. Based onthese Group-wide plans and guidelines, each division or company sets
up its own mid- to long-term targets, develops and implements specificaction plans, reviews them regularly and works to continuously improvethem.

Growing with Society●●●

Sales andafter-sales service
agents

Logistics●

Use

Communications
satellite

2. Simultaneous Realization of Environmental and Economic
Performance
We are committed to improving both environmental performance andeconomic efficiency, as a group of companies working toward superior
manufacturing for customer satisfaction. To this end, we constantly takeup the challenge of advancing technologies to develop creative productsthat improve both environmental performance throughout the product's
life cycle and the product's economic performance at the same time.

Developing People

Relationship of the Komatsu Group's Business Activities with the Environment ・・・・・・・・・・

1. Contributions to Realization of Sustainable Society
Mankind must not only promote the further growth of a rich andcomfortable society but also pass down this indispensable environmentof our planet earth to future generations in a sound and healthy
condition.
We, at the Komatsu Group, define environmental conservation efforts
as one of the highest priority management tasks, and endeavor tocontribute to the sustainable growth of society by integrating advanced
technologies into environmental conservation efforts in all our businessactivities. This is represented by our hybrid construction equipment
which features a substantial reduction of CO 2 emissions while inoperation and by our superior manufacturing.

natural resources, such as materials and water, promote their re-use or
recycle them as much as possible, and expand Zero Emissions fromour manufacturing activities around the world. At the same time weensure the thorough management of waste materials in all our businessdomains, including our suppliers and distributors. We also continuously
work to increase the recyclabillity 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 ourestablished standards concerning the conservation of water quality,
prevention of air pollution, noise and vibrations.
As much as possible, we also ensure the thorough management ofchemical substances for use in our business activities, while continuously
reducing the use of potentially harmful chemical substances or replacing
them with alternative substances for discontinuation of their use.
4) Biodiversity
We recognize biodiversity as one of the important issues concerning theearth 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 effective actions.

Enhancing Quality of Life

Corporate Principles ・・・・・・・・・・・・・・・・・・・・・・・

3. Environmental Education and Communication
We believe that it is important to enhance the environmental awarenessof 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, suchas major affiliated companies and suppliers, and strive to disclosesuch 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.

CSR Digest 201312

CSR Themes ❶Enhancing Quality of Life ―Providing products required by society―

Enhancing Quality of Life ―Providing products required by society―

Mitigating Climate Change

Enhanced Safety

Halving Electricity Usage Project(3) Using alternative energy
Komatsu has installed solar panels on the rooftop of buildings to
generate solar power.
We are also working on finding ways of taking advantage of renewableenergy, such as using the stabilized temperature of groundwater to help
with air conditioning.

Enhanced Safety at Customer Sites ・・・・・・・・・
ICT, environment, and safety are very important considerations in
Komatsu's product development. In addition to supplying products thatprovide superior safety performance, we also strive to prevent accidents
and failures. We do this by making recommendations and holding
lectures together with our distributors to ensure that the machinery at
customer worksites is operated safely.
Content of Safety Workshops (based on case studies of construction
equipment sales in Japan)（Frequency Rate）

7.0

Approach to Power-Saving ・・・・・・・・・・・・・・・・

5.0

The fundamental methods for power reduction that we will use are:(1) Control use of electricity to eliminate waste by realizing lower energy
requirements, (2) Revamping production and (3) Use alternative energy
sources

All indsutries (Japan)
Construction and mining equipment
manufacturing industry (Japan)
Komatsumanufacturing facilities(Global)Komatsu Group (Glpbal)

We construct a system that will automatically tracks power consumption
by domestic Komatsu plants, and send this information to the head
office, to be made available for company-wide viewing.
In addition we are working on making it possible to visualize in evenmore detail the power usage of each Komatsu building and facility.
Visualizing where power usage occurs will enable us to discover where
power is being wasted, which facilities have poor energy efficiency, andthe correlation between power usage and production activity. This will
help us move ahead with our power-saving activities more effectively.
In addition, we are promoting our activities to visitors and conducting
awareness campaigns to general staff through digital signage in places
like the office lobby.

（％）
100

100
10
Realizing
↓
Lower
30
10
energy Revamping
requirements production Alternative
energysources

80
60
40
20
0

13

CSR Digest 2013

2010

50

2015（FY）

Awazu Development Center

New energy-saving buildings
While implementing power usage reduction activities company-wide, we
found that if we incorporate energy-saving technology in structures being
rebuilt, it would be possible to reduce power consumption by about 50%
in places such as office buildings and assembly plants, where the primary
power consumption is due to lighting and air conditioning. Because over
60% of Komatsu production buildings were built over 40 years ago, there
have been cases where the narrow spacing between posts inhibits theconstruction of efficient production systems.
Therefore, we have decided to move forward with the integrated
renewal of production buildings.
In addition to utilizing the latest energy-saving technologies, weare aiming for significant improvement in production efficiency byincorporating production reform (streamlining) and reducing power
consumption by decreasing overall square footage of buildings.
Starting with construction on the Awazu Plant in 2013, we are
expecting to invest 30-40 billion yen by 2020.
Basic Ideas(1) Use the latest energy-saving technology to achieve 50% reductionin power usage(2) Increase efficiency by production reform, and reduce size offacilities by 30%(3) Construct new buildings that use natural energy (sunlight,
groundwater, etc.) more effectively

5.46

4.0

6.20

3.0
2.0

1.75

1.0

1.54

3.06
1.62

3.30
3.10
1.61

●
●
●

1.63
1.62
1.60

●

1.59

1.34
1.28
0.86

●

0

0.74

2008

2009

1.00

2010

1.27

2011

●

2012

（FY）

1. The data for work hours at Komatsu Manufacturig Facilities production plants are based on data from 22
domestic and main overseas companies.
2. The scope of KOMATSU Group includes KOMATSU production plants, Japan domestic dealers, of which for2010 includes only construction machinery, then extended to include forklifts in 2011.

Under the Slogan "Full Participation," 1,200
Employees Strive for Zero Accidents
Yuichi Matsumoto
General Manager, Safety & Environment,Administration
Department,Komatsu Forklift Japan Ltd.

Komatsu Forklift Japan was established in October 2009 through themerger of nine Group forklift sales companies in Japan that had previously
operated independently. At first, the new company experienced some tension
over differing approaches and business cultures related to safety. These
differences were ultimately overcome, and a company-wide system wasestablished by 2012 to manage occupational safety and health under thefollowing principles.
[1] We will make safety our top priority.
[2] We will deliver safety and security to continuously earn customer trust andloyalty.
[3] We will fully comply with our rules.
(pertaining to required safety equipment and protective gear and fulladherence to operational standards)

Initiatives for Business Partners
Please refer to "Together with Business Partners."

Initiatives to Ensure the Health and Safety of
Employees ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・
Our company issues our president's message on occupational healthand safety, and in April 2011, "Occupational Safety and Health Policies"
were newly incorporated in Komatsu's Worldwide Code of BusinessConduct. These policies will be promoted through joint activities by thecompany and its employees.
>> http://www.komatsu.com/CompanyInfo/profile/conduct/#c05
The Group will foster occupational safety, mainly through small "zeroaccidents" activities held on a full participation basis. While continuing
to upgrade safety-related education and training, the Group aims to
support safety activities at Group companies around the globe. We
will continue to strengthen our Group-wide health and safety system
and also implement mental and physical healthcare management topromote employee health.
>> http://www.komatsu.com/CompanyInfo/csr/2013/1-1.html

A convention is held nine times around the country so that all employees
can hear about policies governing occupational safety and health activities
from the president, reports on contingency planning case studies andlectures on safety and health. The objective of this convention is to raise
employee awareness about occupational safety and health.
2. Sharing of "Hiyari-Hatto" (close call) incidents, training to anticipate
potential dangers and simulations of dangerous situations
Morning safety assemblies and safety training sessions are conducted ateach site under the supervision of regional safety promotion officers. The
participants share local examples of "Hiyari-Hatto" incidents, are trained
to anticipate potential dangers, and take part in simulations of dangerous
situations aimed at preventing accidents.
3. Safety patrols to ensure thorough site improvements
The president periodically visits sites across the nation in an ongoing effort
to improve safety and ensure that safety procedures and the 5Ss* arebeing implemented at company sites as well as during forklift maintenanceat customer sites.

Growing with Society(1) Reducing waste by realizing lower energy requirements

6.20

6.0

・Know-how in safety management and risk aversion
・Safety measures based on past experience
・Safe operation of different types of construction equipment.

Developing People

Komatsu has continuously pursued both productivity improvements andenergy-saving activities.
After experiencing electric power shortages in the service areas ofTokyo Electric Power Co., Inc. and Tohoku Electric Power Co., Inc.
several months after the Great East Japan Earthquake in 2011, it was
anticipated that electric power shortages would occur in 2012 or later.
By detailed analysis of the use situation of electric power, it has
discerned that it is possible to reduce 50% or more of electric power
finally.
Our new goal is to cut summertime peak electric power needs by
50% compared to consumption levels in the summer of 2010. We plan
to limit consumption to reduce the environmental impact.

(2) Production Reform
About 60% of Komatsu production plants' power consumption byprocessing parts.
Komatsu has several manufacturing processes including machineprocessing and welding. In each area we are working to reduce powerusage by improving equipment, as well as by increasing efficiency in the
manufacturing process.

Enhancing Quality of Life

Power-Saving Activities ・・・・・・・・・・・・・・・・・・・

Safety is one of the most important issues at Komatsu as we expand our business. In addition to enhancing
the safety of our products and services, we also emphasize safety at customer sites and the workplaces of ouremployees and business partners.

Our Approach to CSR

CSR Themes ❶As a result of these activities, we were able to reduce the number of accidents
in FY2012 by 35% from the previous year.

Within this framework, we engage in the following activities under the slogan"full participation."

We intend to draw the full participation of all employees so that efforts arecontinuously made every day to deliver safety and security and thereby
continue earning the trust and loyalty of our customers.

1. Occupational safety and health conventions where all employees
participate*Seiri (sorting), seiton (setting in order), seiso (systematic cleaning), seiketsu(standardizing) and shitsuke (sustaining)

CSR Digest 201314

CSR Themes ❷Developing People
Key Activities
・Contributing to human resource development in local communities
・Enhancing our employees and suppliers through The KOMATSU Way
・Enhancing our employees and distributors through brand management

Pursuing Community Based Human Resource
Development around the World

Support Center in Tanzania for developing distributor service personnel

Human Resource Development to
Meet Regional Needs ・・・・・・・・・・・・・・・・・・・
Komatsu develops human resources in a way that best meets the
specific needs of each region. In Africa, for example, where moremechanics are required due to rising demand for our products, wecultivate work-ready personnel by collaborating with sales and service
distributors and by sharing our training expertise. In China, Komatsu
offers a specialized course at a university in Shandong Province totrain newly recruited service personnel in an effort to more quickly
turn out a greater number of mechanics. And in Myanmar, we are
addressing the need for teachers who can train mechanics bycollaborating with a local university and setting up a course to prepare15

CSR Digest 2013

A robot competition during a scienceclass, where children can enjoy learning
how thermoelectric devices work

Exploring nature in the park's satoyama zone

■ Number of Visitors (Cumulative Total)■Number of Volunteers (Cumulative Total)(thousand people)

120
100
80

Komatsu Training Center in Nairobi
set up at a distributor's office

Training course in Myanmar

Cultivating the Next Generation
at KOHAG Germany ・・・・・・・・・・・・・・・・・・・・・
Komatsu Hanomag GmbH (KOHAG) signed an agreement with four
local elementary schools to promote technical education starting in
December 2011. The agreement reflects national- and provinciallevel initiatives to avoid a skills shortage in technological expertise andbetter equipping the next generation. KOHAG provided five toolkits
developed by a German NGO free of charge to each school. KOHAG
employees have been mentoring teachers on how students can use
the toolkits in the classroom and provide follow-up assistance.
The toolkits, which contain tools such as screwdrivers, parts such as
bolts and electrical circuits, construction materials such as boards andwheels, and an instruction manual, enable students to learn the basics
of construction, automotive engineering and electricity. After the class,children are invited to the KOHAG factory to see for themselves theprinciples they have learned by observing actual machines.

KOHAG employee providing advice
to elementary school teachers

Children visiting KOHAG after class(people)

6,000
5,000

107
63.5

60

3,000

40

2,000

20

1,000

0

FY2011

5,673

4,000

UP to FY2012

0

1,961

All equipment was replaced on the manufacturing line, now closely associatedwith Komatsu know-how.
FY2011UP to FY2012

A Technical Training Program of
the Highest Standards in Europe
Support from Komatsu is contributing
to enhanced competitiveness and thesustainable development of UmeåMr. Mikael Öhlundd

City Chief Executive, City of UmeåUmeå is northern Sweden's largest city and among the country's
hottest spots for growth. It is also the European Capital of Culture 2014.
One of the greatest challenges facing Umeå is long-term accessto technical and industrial competence. Consequently, Komatsu's
donation to the Dragoon School Technology Centre is extremely
important for future industrial development in the region.
We are convinced that the donation will give Umeå one of thebest technical training programs in Sweden. We have alreadynoticed that the Technology Centre's courses are attracting
more young people. This will strengthen the competitiveness ofindustrial companies. By enabling Umeå to reinforce its position
as a leading industrial region, Komatsu's donation also contributes
to Umeå's continued growth.
As regards courses tailored to industry, the Dragoon School

Technology Centre is now an arena of the highest European level.
Komatsu's donation has played a pivotal role here. The investment
greatly contributes to making Umeå an attractive industrial cityin which the Technology Centre plays an important role in driving
Umeå's development.
We have been overwhelmed by Komatsu's obligingness andthe close collaboration that has emerged. For many years, themunicipality of Umeå has worked ambitiously toward long-termsustainable development. In Komatsu we have found a partner withwhom we can work hand in hand to achieve our ambitions. We
feel this is an excellent example of how communities and trade andindustry can build the future together. With mutual respect for eachother's roles, we want to build further on these success factors.
In the ways outlined above, the municipality of Umeå and our
region are becoming ever more attractive for study and work. At
the same time, with training courses that respond directly to thechallenges of working life, we can supply companies with the skills
they need. All this contributes to creating the conditions for Umeåto continue as a force for growth in northern Sweden. A shining
and concrete example of this is that, to everyone's delight, several
Dragoon School students, on passing their exams, have now been
employed by Komatsu Forest.

CSR Digest 2013

Growing with Society"Developing People" is one of Komatsu's core CSR themes.
Our initiatives in this area focus on supporting human resource
development in the locations around the world where we do business.
Wherever our operations take us, mechanics are required to service
and maintain construction equipment in good operating condition. As
the company that sells this equipment, we believe we are responsible
for cultivating the human resources needed to service it. Under thisprinciple, we have opened training centers around the world to develop
servicepersons and at the same time provide opportunities for thesetrainees to acquire the skills they need to qualify as mechanics.

teachers to provide specialized training for construction equipment.
In addition to these efforts, Komatsu contributes to society
through the use of our core technologies and resources by pursuing
initiatives for empowering the younger generation which will shoulder
the future of manufacturing.

Developing People

Training Service Personnel in Regions
where We are Established asa Responsible Manufacturer ・・・・・・・・・・・・・

Sweden's Komatsu Forest AB has extended a donation to theTechnical College at the local Dragoon School to benefit the Cityof Umeå and neighboring regions. Facilities and equipment were
replaced in one of the school's areas, which was named the Komatsu
Technical Center in September 2012. The center has a manufacturing
line equipped with the most advanced industrial robots as well as a
welding workshop for training and an information processing center.
A course has been added to the school curriculum to teach the
KOMATSU Way of manufacturing and a scholarship was establishedso that outstanding students could come to Japan and experience
manufacturing at Komatsu. The donation has helped to create ahighly advanced educational environment with technologies similar to
those used by leading corporations.
As the Komatsu Technical Center generates human resources
capable of forming the backbone of manufacturing and attracts
young, competent people, Umeå is expected to thrive as a major
center for manufacturing education.

Enhancing Quality of Life

The "Komatsu Green Park" was opened in 2011 in Komatsu City,
Ishikawa Prefecture - the birthplace of Komatsu - to provide an
educational environment for future generations and particularly
local elementary school children. The park contributes to the sounddevelopment of the children through nature hikes in its satoyamazone and science classes. The program is unique in that it is primarily
staffed by retired Komatsu employees through an incorporated NPO,
with four divisions that plan and conduct the nature hikes, scienceclasses and cleanup activities and support local events. A total of 283
former employees have registered with the NPO, and the park hasreceived over 100,000 visitors.

Social Contribution Efforts in Umeå, Sweden
Our Approach to CSR

Retired Employees Engage in Activities
at Komatsu's Birthplace ・・・・・・・・・・・・・・・・・

16

CSR Themes ❷Developing People

Developing People

Creating the Right Working Conditions
for Everyone

The KOMATSU Way and Human Resource Development

Global Personnel Policy ・・・・・・・・・・・・・・・・・

Enhancing Work-Life Balance ・・・・・・・・・・・・

Revision of the KOMATSU Way ・・・・・・・・・・

Personnel systems reflect the history and culture of each particular region.
It is therefore important to recognize and understand those differences.
Based on the basic policy outlined below, the members of theKomatsu Group are creating a personnel system tailored to theneeds and reflecting the circumstances of each particular region.

Reducing the Total Number of Working Hours
Reducing the total number of working hours is a key factor inachieving a healthy work-life balance for employees.
In Japan, for example, Komatsu has worked in coordination withlabor unions on this issue to formulate numerical targets, which
are now set at 2,100 or fewer working hours per year and at least
16 days of paid leave taken per year. Efforts are continuing toachieve efficient working conditions through measures such as theformulation of an activity schedule for each workplace.

We distributed the second edition of the KOMATSU Way in
November 2011 and held briefings for managers at our plants andsubsidiaries in Japan to explain the revised content.

(1) We shall respect each employee’s fundamental human rights, inherent
personality, individuality, and legally protected privacy.
(2) We shall treat and appraise each individual employee in a fair and impartial
manner. We shall not discriminate against any employee on the basis ofnationality, race, religion, age, gender, physical or mental disability or otherlegally protected attributed that are irrelevant to his or her performance.
We shall vigorously endeavor to promote equal oppor tunities for
employment and eliminate harassment in the workplace.
(3) We shall endeavor to provide employees with workplaces where they canseek a good balance between their private and professional lives, while
effectively accomplishing their respective tasks with satisfaction and pride.
(4) We shall endeavor to design and administer the system of human resource
management in a manner that is most reasonable and persuasive to theemployees. We shall make such systems open and clearly explain them tothe employees to the maximum extent practicable.

Our overseas subsidiaries have been translating the second editionof the KOMATSU Way into the languages of their locations, and thetranslations for major subsidiaries were completed before March 2013.

Human Resource Development andTraining Structure・・・・・・・・・・・・・・・・・・・・・・・

Thai and Chinese versions of The KOMATSU Way; more language versions will
be made available.

Briefing at Bangkok Komatsu

Basic Programs

Programs for Each Functional and Divisional Units(7) Komatsu Group companies shall endeavor to offer to their respective
employees those terms and conditions for employment that are sufficiently
competitive in their respective regions.

Program/MeasureChildcare Childcare leave programsupportNursing leave

5 days for nursing care of one child up to the third grade of elementary school, and 10 days for the second child onward

Family-care leave program

A maximum of 3 years available to employees taking care of family members

Part-time work

Shortening of working hours by a maximum of 3 hours per day

Care leave

5 days per year for attending to one family member in need of nursing care, and 10 days for the second family member onward

Flexible leave
Volunteer incentive
program17

CSR Digest 2013

Accumulation of a maximum of 40 days of unused annual leave
An employee can add 5 new days of accumulated leave, not to exceed 10 days per year
Can be used as sick leave, to take care of sick preschool children, or for care of family members
Provided to encourage employees to take 5 consecutive days of leave for the mental and physical rejuvenation
Employees receive an additional 5 days of annual leave and a travel voucher upon completion of their 15th, 25th and35th year of continued service>

Professionals from Individual Functions

Specialists

TechniciansCommon Programs

New Executive Officers(Send to Outside Programs)

Business
LeadersGM

Executive Personnel (Business Leaders)

Top Management Forum (TMF)
Superior Master Mechanic

Global Management Seminar (GMS)
Business Leader
Development A

K-Way Leadership Development Program(KLDP)

KOMATSU Way Middle Management Training ADVANCED (New Managers’ Training)
Managers

Chief Master Mechanic

MiddleManagement
Assistant Managers

Overseas Education
Master Mechanic

KOMATSU Way Middle Management Training(New Managers’ Training)

Business Leader
Development B

Cross-industry seminars

New Assistant Managers’ Training

Global Technical Institute(GTI)
Technical Institute

Young executive
education

Functional Basis / Division Basis Training
3rd Year Training

Long-term paid leave of up to 2 years, or short-term paid leave of 12 days per year
New employees

The Komatsu Education System

Product Support
College
New Hires’ Training

Philippines
Human Resource
Development Center

Meister
education

Technology
Olympics

Foremen Training

Other
Accumulated
annual leave
leave
programs

Executive Officers

Manufacturing
Engineers

Global Programs for Overseas Employees

Senior Foremen Training

Allowance toward the cost of childcare for infants up to age 2 before entering nursery school (10,000 yen/month)<

Selective Programs

Mid-career
employee education
Komatsu
Technical InstituteCommon Training Programs (The KOMATSU Way / ICT / Compliance / Environment, etc.)CaresupportAllowance toward the cost ofusing childcare services

Programs for Selected Employees
Role ImageTQM Trainings / QC TournamentPart-time work

Description
Available for a maximum of three years from the birth of the child to the time the child enters nursery school. Also available fora maximum of three years for children up to the third year of elementary school in cases where a spouse is transferred, etc.
5 days during pregnancy (for women)
5 days when an employee’s wife delivers (for men)
5 days for infant care (for both men and women)
Shortening of working hours by a maximum of 3 hours per day to allow for care of children up to the third grade ofelementary school

Language Skill Support Program

Pregnancy, maternity
and childcare leave

KOMATSU Way briefing at the Ibaraki Plant

Komatsu strives for sustainable growth of both the company andemployees through human resource development. Our policy isthat "each employee should set high goals and be self-reliant andself-motivated in acquiring knowledge and skills" and that "thecompany should support employee career development through theimplementation of necessary education for both the company andemployees in a focused manner."
While fulfilling the education of professionals in a variety of fields,
the company also supports the acquisition of knowledge and skills
at every level at the company. Regular explanatory sessions anddiscussions are convened at Group companies to disseminate the
KOMATSU Way and incorporate it into human resource development
around the world at each level of the company hierarchy, as well as
to allow this knowledge to be handed down to younger generations.

(6) We shall not tolerate child labor or forced labor.

■ Main Programs and Measures Designed to Enhance Work-Life Balance

Key themes of the Management Section (Summary)・Top management shall act with awareness of CSR, always have familiarity
with the workplace, and formulate management policy based on analysis ofdata from the workplace.
・Make sure to hold board meetings regularly. Thoroughly discuss theagenda items through these steps: Reporting / Discussions / Resolutions.
・Top management should explain, in their own words, the current conditions andfuture direction of the company to all the stakeholders including employees.

Growing with Society(5) Komatsu Group companies shall comply with all applicable laws andregulations governing employee rights in the jurisdictions in which they
operate, and faithfully accommodate, wherever applicable, conversations
or discussions with employees or their representatives.

In 1991, an employee volunteer incentive program was established,providing for a maximum of two years of paid leave and a maximumof 12 days per year of special leave. Furthermore, as of 2012, thecompany has awarded the President’s Volunteer Award to 39 e
mployees who dedicated themselves to o utstanding long-term
service to society. As for support for reconstruction in the areas
devastated by the recent Great East Japan Earthquake, the company
cooperated with the labor unions to pay a transportation allowanceto employees traveling to the disaster-stricken region as volunteers.

The KOMATSU Way, Second Edition
Ⅰ. Introduction / What is the KOMATSU Way?
Ⅱ. Top Management
Ⅲ. "Monozukuri" for all employees
Ⅳ. Brand Management

Developing People

The development of global human resources is an ongoing theme for the Komatsu Group. In addition
to disseminating education in the KOMATSU Way so that it can be shared by employees worldwide, thecompany has set up a system geared toward training professionals in various fields.

Enhancing Quality of Life

Employees of the Komatsu Group companies are an indispensable asset for the Group, which seeks tofoster a safe and comfortable working environment, while maximizing opportunities for employees.

Our Approach to CSR

CSR Themes ❷CSR Digest 201318

CSR Themes ❸Growing with Society
Key Activities
・Engaging in dialogues with our stakeholders
・Providing social contributions through the use of our coretechnologies and resources (e.g., disaster relief or activities toremove antipersonnel land mines)・Contributing to our local communities where we do business・Strengthening our corporate governance and compliance
・Promoting compliance with environmental, labor, and social norms
within our group and among business partners

Serving the Changing Needs of Disaster
Areas, Step by Step ・・・・・・・・・・・・・・・・・・・・・

First Stage

Second Stage

Third Stage

Direct support for victimsof the earthquake
and tsunami

Recovery of
local communities

Support and cooperation
for full-scalereconstruction

Immediately after the earthquake, the most urgent challenges wereto remove the scattered debris and restore damaged roads. To aid inthese efforts, Komatsu gathered 264 pieces of construction equipmentfrom around the country and loaned them free of charge. In addition,
671 employees from the sales and support divisions helped operate
the equipment at 55 sites in the disaster-stricken prefectures of Iwate,
Miyagi and Fukushima.

■ Second Stage

Forklift donated to support the recovery of the fisheries industry

Recovery of local communities

As finding a "space to pursue everyday life" became a top priority forresidents of the disaster-stricken areas, Komatsu began contributing
to local recovery efforts by providing temporary container houses andprefabricated housing free of charge. Local communities are using
these facilities as schools, kindergartens, post offices and clinics.

Komatsu Safety Training Center, Miyagi Center, in Natori City, Miyagi Prefecture

Return of the Amphibious Bulldozer
Leading the recovery and reconstruction ofdamaged fishing ports, bays and rivers

Mr. Masaki Umakakeba,
Hydraulic excavator in operation in
Onagawa, Miyagi Prefecture, where
removal of debris was a pressing needTemporary post office provided by
Komatsu in Rikuzentakata City, Iwate
Prefecture

Today: Supporting Full-Scale
Reconstruction ・・・・・・・・・・・・・・・・・・・・・・・・・

The Tohoku Operation Department served as a base for evaluating local needs andproviding quick support.

19

CSR Digest 2013

Looking ahead, we will continue to support full-scale reconstruction
efforts by leveraging the Komatsu Group's management assets.

We are now in the third stage of assisting in the full-scalereconstruction. Komatsu donated forklifts to the NPO "Signal of
Hope" to support the recovery of local industry. About 60 forklifts are
now in service at damaged fisheries facilities. We also established

Civil Engineering Technology Dept.,
Aoki Asunaro Construction Co., Ltd.

I was speechless as the current of the Natori River reversed andswallowed nearby houses. The tsunami was of unprecedented size! At
a little after 3 p.m. on March 11, 2011, a stunning scene was unfolding
before me on a monitor in the lobby of New Chitose Airport. Although
two years have passed since that day, the coastal areas of Sanriku,
Miyagi and Fukushima seem far from recovery.

Amphibious bulldozer in operation in the Natori River in Miyagi Prefecture

Growing with Society

In the immediate aftermath of the earthquake, we set up our Tohoku
Operation Department in Sendai City, Miyagi Prefecture. This led to acooperative effort with governments in the affected areas to identify
the needs and support reconstruction, primarily by meeting requests
for rent-free construction equipment and temporary housing. Currently,
support and cooperation for full-scale reconstruction are essential, andwe continue to provide practical, step-by-step support as the situation
requires.

■ First Stage Direct support for earthquake
and tsunami victims

Construction equipment on ships cannot be used at manyreconstruction sites, such as shallow areas of rivers, debris-clutteredriverbanks and small fishing ports. In order to reach these sites, we
refurbished our amphibious bulldozer for the first time in 20 years.
The bulldozer was developed in 1971 as an alternative to mounting
construction equipment on boats for work in shallow waters at themouths of rivers or in bay areas, but its production has since been
discontinued. We selected and upgraded one of five amphibious
bulldozers still in service and then dispatched it for use in a recovery
effort on a bridge that had been damaged by the earthquake. This
radio-controlled bulldozer can be used not only on land but also as
deep as seven meters underwater, and is currently being operated atreconstruction sites that are difficult for ships to reach.

Developing People

Komatsu has continued to offer support through its core business that
directly serves the changing needs of areas affected by the Great East
Japan Earthquake.

Providing Direct Support and thenFacilitating the Recovery
of Local Communities ・・・・・・・・・・・・・・・・・・・

Komatsu is supporting reconstruction efforts by harnessing ouradvanced technology, which we have developed as a manufacturerof construction machinery. Komatsu sent radio-controlled equipment
to remove rubble and debris at the Fukushima Daiichi Nuclear Power
Station. Regarding the removal of radioactive materials, there arestrong expectations for computer-aided bulldozers that utilize ICT toautomatically excavate surface soil to a fixed, preset depth.

Enhancing Quality of Life

Continuing the Reconstruction of Areas Strickenby the Great East Japan Earthquake

Providing aid to students who will play important roles in manufacturing
is another endeavor we are currently involved with. As part of thisinitiative, we provide "Komatsu Scholarships" through the Instituteof National Colleges of Technology, Japan to students of national
technical colleges in the Tohoku and Northern Kanto regions, whichwere stricken by the disaster. In addition, we established the "Rio TintoKomatsu Scholarship" in collaboration with the mineral resource mining
company Rio Tinto and a Komatsu customer, and provided them tostudents at National University Corporation Tohoku University.

Harnessing Our Advanced Technology as
a Manufacturer
to Support Reconstruction ・・・・・・・・・・・・・・

Our Approach to CSR

the Komatsu Safety Training Center, Miyagi Center and cover half ofthe tuition to train much needed construction equipment operators
and assist disaster victims' in finding employment. More than 4,700
students have already participated in the training, many of whom are
now demonstrating their skills at recovery and reconstruction sites.

been involved in construction work for breeding zones, fishing ports,
bay areas and riverbanks on the northern coast of Iwate Prefecture,
which was devastated by the tsunami. The five amphibious bulldozers
still in service, however, were worn out from long use and required one
repair after another. Two years ago, the people at Komatsu stood up
for earthquake reconstruction and completed a major refurbishment of
the bulldozer. Komatsu factory staff who worked on the repairs wereamazed at the sophisticated technology used in 1971.
We are still receiving requests to dispatch equipment to construction
sites for recovery and reconstruction and for use in shallow waters andthe sea. With help from my good partners at Komatsu, I hope to passalong the amphibious bulldozer and its outstanding performance to thenext generation.

Since the first amphibious bulldozer was developed in 1971, I have

CSR Digest 201320

CSR Themes ❸Growing with Society

Growing with Society

Dialogue with Our Stakeholders

Together with Business Partners– Initiative for CSR Procurement –Business partners that supply materials, parts and components are important in helping tosustain Komatsu's manufacturing activities. Komatsu encourages its partners to abide bysocial norms while working toward CSR procurement.

Global Dialogue with Our Stakeholders ・・・

Establishment and Dissemination of the
CSR Procurement Guidelines ・・・・・・・・・・・・

In February 2012, we invited stakeholders from international non-profit
organizations as well as local governments and universities in Japanto a dialogue at our Osaka Plant. Under the theme of "Envisioning the
manufacturing base of the 21st century," participants discussed issues

activities throughout the supply chain.

Komatsu has consistently worked with its business partners on
environmental and workplace safety-related activities. Following therelease of the ISO26000 international guidelines on corporate social
responsibility in November 2010, we established our CSR Procurement
Guidelines in August 2011 to explain the priority CSR issues we would
like our business partners to address.

The Komatsu Midori-kai group is an association of 164 major business
partners in Japan that supply roughly 75% of the products Komatsu
purchases within Japan. Top management at these companies
regularly gather for meetings, including general conferences,roundtable discussions for managers and informal New Year'sbusiness functions. On each occasion, we emphasize the importance

Stakeholder dialogue at the Osaka Plant

guests on developing skilled human resources through efforts such asoffering specialized courses, providing student internship procedures
and sharing laboratory resources.

While partnering with major universities in Japan, Komatsu also
promotes industry-academia collaborations in China with Shandong
University and Tongji University through joint research, internships
and other projects. In April 2012, we invited Tongji University faculty
members involved in research, career guidance and student
internships to Komatsu (Changzhou) Construction Machinery Corp.
and the KC Techno Center in Changzhou. We provided an overview ofour construction equipment and held a dialogue between Komatsu and

In November 2012 and March 2013, meetings were held to present
the joint research results of Komatsu's partner universities and thecompany. The researchers shared technical reports and engaged in a
discussion that included student participation.
The proposals and opinions solicited through these discussions areboth helpful and unique, and we will make efforts to see them reflectedin our business and operations.

21 CSR Digest 2013

Presentation of joint research results from Tongji University and Komatsu

Midori-kai groups have also been organized outside Japan by our
major business partners in North America, Europe and China. Thereare currently 37 member companies in North America, 51 in Europe
and 62 in China. Overseas group members participate as observers in
the general conference held by the Midori-kai group in Japan, and an
exchange between members from different regions is already taking
place. We expect overseas members to draw upon the actions of theJapanese Midori-kai group to develop their own CSR activities thatreflect the characteristics of each region.

Initiative on Conflict Minerals■ Background on Regulations against Conflict Minerals
The term "conflict minerals" is used in reference to four minerals - tin,tungsten, tantalum and gold (abbreviated as "3TG"). Section 1502 of
the Dodd-Frank Wall Street Reform and Consumer Protection Act
enacted in July 2010 mandates that companies listed on U.S. stock
exchanges report to the Securities and Exchange Commission
when conflict minerals from the Democratic Republic of Congo (DRC)or its neighboring countries are necessary for the functionality or
production of a product. The act is directed at cutting off sources offunding for military groups in the DRC, which has been ravaged bydomestic conflict since 1996.
■ Komatsu's Policy on Conflict Minerals
Komatsu has adopted a policy of not using conflict minerals
produced by the DRC or its neighbors (Angola, Central African
Republic, Republic of the Congo, Rwanda, Southern Sudan,
Tanzania, Uganda and Zambia) modeled after the U.S. Wall Street
Reform and Consumer Protection Act and from our corporate social
responsibility perspective.
During the regular meetings we hold with our suppliers at each
Komatsu plant in Japan, we explain this policy as well as Komatsu's
response to the conflict minerals issue and related requests to ourTour of the KC Techno Center

Overseas Activities ・・・・・・・・・・・・・・・・・・・・・

Growing with Society

Exchange between Industr y-Academia
Collaboration Partners ・・・・・・・・・・・・・・・・・・

In addition, we have begun publishing CSR Communication, a periodic
journal that introduces specific examples of CSR case studies tomember companies of the Komatsu Midori-kai group and otherdomestic business partners. Since May 2011, CSR Communication
has been posted twice a month on our website for business partners
in an effort to consistently promote CSR.

Developing People

These guidelines are intended to deepen the awareness of ourbusiness partners about corporate social responsibility so that we
can mobilize the entire supply chain to accelerate the pace of CSR
activities.

of CSR under our CSR guidelines to build greater awareness of CSR
management.

Enhancing Quality of LifeIn addition to maintaining a dialogue with all of our stakeholders, including employees, business
partners, investors, shareholders and local communities, we also invite stakeholders fromoutside the company to voice their opinions on Komatsu's management and business.

such as "What does society expect from the Osaka Plant, which wecall the 'mother plant' of Komatsu's global production?" and "Howcan we continue to contribute to society over the long term?" Valuable
insights we gained from stakeholder opinions included the importanceof maintaining transparent communication and conducting CSR

Our Approach to CSR

CSR Themes ❸Member companies attended a meeting with other construction equipment
companies in June 2013 in Detroit, U.S.A. and delivered a presentation on conflictminerals

suppliers. With the cooperation of suppliers, we are now conducting
a country-of-origin survey to determine the location of origin of theconflict minerals we use.
Republic of the Sudan
Republic of South Sudan

Looking ahead, we will conduct a moredetailed survey that includes refineries
in its scope and continue taking steps
to prevent the use of conflict minerals
from the DRC and its neighbors andthereby restrict funding for militarygroups.

Central African Republic
Republic of Uganda
Republic of the Congo
Republic of Rwanda
Republic of Burundi
Democratic Republic of the Congo
Republic of Angola
Republic of Zambia
Republic of Tanzania

C o u n t r i e s A s s o c i a te d w i t h
Conflict Minerals

CSR Digest 201322

CSR Themes ❸Growing with Society

Growing with Society

Frameworks for Promoting Compliance

Risk Management
While Komatsu continues to make efforts to improve corporate value, it recognizes issues
related to compliance, in particular the environment, product quality, accidents and information
security, as risk factors for sustainable growth and is therefore implementing the following countermeasures.

Following the principle that compliance is a top priority, Komatsu will ensure that it fully
understands and complies with business rules while also reinforcing its compliance system.

To ensure that the entire Komatsu Group fully understands the rules ofthe business community, Komatsu has appointed an executive officer
in charge of compliance and established the Compliance Department
to handle this area exclusively. The Compliance Committee, chairedby the President and CEO, reviews the Group’s action policies andimportant issues while regularly reporting on the status of compliancerelated activities to the Board of Directors.

Komatsu considers CSR as a key responsibility, and Komatsu'sWorldwide Code of Business Conduct clearly conveys our policyof giving full weight to CSR. The pillar of Komatsu's CSR activities
is based on constant repetition of the following process, outlined in
the Code of Worldwide Business Conduct: (1) Establish the Code ofBusiness Conduct, (2) Implement the Code of Business Conduct, (3)Determine the Code's current status and (4) Address inadequacies.

Process for Compliance Activities(1) Establish the Code of Business Conduct
Formulate Komatsu's Worldwide Code of Business Conduct
as a foundation for compliance activities and revise thiscode (currently in its 8th edition) as required to reflect socialchange.
(2) Implement the Code of Business Conduct
Implement the Code of Conduct through education that
corresponds to employee rank and the types of operationsin w h ic h th ey a re invo l ve d, a nd by c o m m u n i c atin g
information in accordance with Komatsu's Worldwide Codeof Business Conduct.
(3) Determine the Code's current status
Determine the level at which Komatsu's Worldwide Code of

23 CSR Digest 2013

・・・・・・・・・・

For continual awareness of compliance among employees, the Groupis working to raise their knowledge of best business practices by
displaying in every Komatsu Group business unit posters that list "TheFive Principles of Compliance," a condensed version of the code ofbasic conduct related to compliance. Beyond this, we strive to provide
effective awareness-raising through the use of e-Learning and welldeveloped, compliance-related education and training that correspondto employee rank and the types of operations in which they are
involved. Moreover, the Group not only conducts financial audits, but
we also undertake compliance risk auditing of our business units andGroup companies to monitor compliance in important areas such as
safety and environmental practices, which enables us to detect risks
early and make improvements.

Internal Reporting System ・・・・・・・・・・・・・・
Komatsu has set up consultation offices both internally at KomatsuGroup companies and externally at law firms, collectively known as
the Employee Business Rule Consultation Offices, in order to respondto consultations with or reporting from Group company employees
pertaining to best business practices or questionable actions.
We promote active consultation and reporting by clearly stating in
Komatsu's Worldwide Code of Business Conduct and Group company
workplace rules that employees who use the system for appropriate
reporting will not be treated unfairly in any way as a result of that action.

State of Compliance in FY2012

・・・・・・・・・・

The Komatsu Group experienced no substantial compliance-related
infractions or incidents in FY2012.

securing communications.

■ Komatsu has established Risk Management Rules to correctly

recognize and manage risks, for which the company has appointed
personnel in charge of individual risks, further promoting the buildup of a solid foundation for risk management.

■ Komatsu has established a Risk Management Committee to devise

risk management policies of the Komatsu Group, evaluate risk
measures in place, and take control of risks when they surface.
The Risk Management Committee regularly reports its reviews andactivities to the Board of Directors.

■ Komatsu will establish an emergency headquarters when serious

risks surface and work to minimize damage(s) and implement
appropriate measures.

Drill for a first stage response by the interim emergency headquarters at the
Head Office

Implementing a Business Continuity Plan ・・・
Komatsu has formulated a business continuity plan (BCP) to carry out
major operations without suspension, or restore them after a shortsuspension, should a disaster or accident occur.
At the Head Office, we conduct regular drills to ensure that employees
are capable of taking appropriate action in the event of a real
emergency, assuming the occurrence of an earthquake striking
beneath the greater Tokyo metropolitan area, a disaster considered tobe highly probable.
All our plants have been enhancing the seismic strength of theirbuildings and facilities while developing measures against torrential
rainfall in accordance with the plans each plant has formulated.
Moreover, in the event of an outbreak and subsequent epidemic ofa new strain of influenza, a specialized committee will be set up to
implement appropriate measures. We also strive to deepen employees'
understanding by providing an action manual on how to prevent andrespond to an outbreak, and related education.

Promoting Risk Management throughout
the Group ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・
To reinforce the risk management structure across the Group,
Komatsu is working to enhance the level of management at eachGroup company by establishing reporting lines and manuals related
to risk and through explanatory meetings and study sessions on risk
management and BCPs.
We are also strengthening our Group-wide system for communications
in times of emergency by introducing tools such as an emergency
contact and employee safety confirmation system and a wide range

Rescue drill with the Tochigi Prefectural Aviation Firefighting Team at the Oyama
Plant using a disaster prevention helicopter

Growing with Society

The company has formulated Komatsu's Code of Worldwide BusinessConduct (established in 1998 and revised seven times to date) as acompilation of best business practices to be observed by officers andemployees of Komatsu Group companies both in and outside Japan.
The code addresses topics such as free and fair business practices,
appropriate relationships between the company and employees,
endeavors for the global environment, the handling of information andthe establishment of an internal control structure. The text of the code
has been released to the public in its entirety.

Toward Thorough Compliance

two-way radio and by conducting regular drills on using the system andDeveloping People

Komatsu's Code of Worldwide BusinessConduct ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・

Business Conduct is being applied by having all business
units regularly report on their use of the code and by
conducting audits and enhancing the Internal Reporting
System.
(4) Address inadequacies
Any issues identified during the above activities will be
addressed in accordance with Komatsu's Worldwide Codeof Business Conduct and preventive measures will be
implemented.

Basic Principles and System for Risk
Management ・・・・・・・・・・・・・・・・・・・・・・・・・・・

Enhancing Quality of Life

Strengthening Compliance ・・・・・・・・・・・・・・

Our Approach to CSR

CSR Themes ❸Consolidating Information Security ・・・・・・
With the Information Security Committee at its core, Komatsu isdeveloping a structure for information security for the entire Group andimplementing various control measures. As part of this, we distributean Information Security Guidebook to all employees in order to raise
their awareness of thorough compliance with the rules.
Additional measures have included the establishment of a protective
framework for our system to prevent information from being falsified,destroyed, leaked or lost due to negligence orunauthorized access from outside the company.
Moreover, we undertake information security audits
to confirm that measures are being effectively
implemented, and to discover defects and makethe required improvements.
Infomation
Security Guidebook
CSR Digest 201324

CSR Themes ❸Board of Directors
Komatsu Ltd. holds Board of Directors’ meetings periodically at least
once every month. The Board of Directors deliberates and makes

Corporate Governanceresolutions on important matters, determines management policies
of Komatsu, and rigorously controls and supervises the execution ofduties by all members of the executive management team including
Representative Directors. Of the 10 Directors on the Board, three are
Outside Directors to ensure transparent and objective management.

■ Outside Directors (As of June19,2013)

Basic Stance・・・・・・・・・・・・・・・・・・・・・・・・・・

Reasons for Selection

Kensuke Hotta

Chairman and Representative Directorof Greenhill & Co. Japan Ltd.
Chairman and Representative Directorof Hotta Partners Inc.

Having served as Representative Director of The Sumitomo Bank, Ltd. (name at the time)and having experience as Representative Director of Morgan Stanley Japan Securities
Co., Ltd. (name at the time), Mr. Kensuke Hotta has been active internationally in thefinancial field and has considerable insight and rich experience in the business world.
Using this insight and experience, his proposals concerning the overall management of
the Company are expected to contribute to sustaining and improving transparency andsoundness of management and enhancing corporate governance. Therefore, we haveelected him as an Outside Director.

Professor Emeritus at Tokyo Universityof Science

Having served as President of the Japanese Society for Quality Control, Dr. Noriaki Kano
has been active internationally as a specialist of quality control and has considerable
insight and rich experience. Using this insight and experience, his proposals concerning
the overall management of the Company are expected to pursue higher “Quality andReliability,” the fundamentals of the Company’s management, and enhance corporate
value. Therefore, we have elected him as an Outside Director.

Corporate Advisor of Asahi Group
Holdings, Ltd.

Having served as Representative Director of Asahi Breweries, Ltd. (name at the time),
Mr. Kouichi Ikeda has considerable insight and rich experience in the business world.
Using this insight and experience, his proposals concerning the overall management of
the Company are expected to contribute to sustaining and improving transparency andsoundness of management and enhancing corporate governance. Therefore, we haveelected him as an Outside Director.

investors.

Noriaki Kano

Establishment and Improvement ofCorporate Governance ・・・・・・・・・・・・・・・・・
In 1999 Komatsu Ltd. introduced the Executive Officer System andhas 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 the Board of
Directors to a small number of members and appoint Outside Directors

and Outside Audit & Supervisory Board Members. To improve theeffectiveness of discussions at meetings of the Board of Directors,
we have worked to reform their operational aspect, primarily byputting in place a system to ensure thorough discussions of importantmanagement matters and prompt decision making. We have alsoestablished the International Advisory Board (IAB) as a means to
supplement executive functions.

Audit & Supervisory Board
The Audit & Supervisory Board determines such matters as audit
policies and the division of duties among Audit & Supervisory
Board Members. Each Audit & Super visor y Board Member
attends meetings of the Board of Directors and other important
meetings, and audits the execution of duties by Directors.
Meetings of the Audit & Supervisory Board are in principle held
periodically at least once every month, and the Board performs■ Corporate Governance of Komatsu

General Meeting of Shareholders

Audit

Audit & Supervisory
Board
Standing 2/Outside 3

Elect/Discharge

Audit reports
Board of Directors

Office ofCorporate,
Auditors Staff

Standing 7/Outside 3

Recommend
Compensation
Advisory Committee

Collaboration
Internal
Audit Dept.

Internal audit
ReportElect/Discharge/Supervise

Internal
audit

Accounting Auditors(Audit corporation)

ReportAffiliated companies
Komatsu Ltd. sends Outside
Directors and Audit &Supervisory Board Members

Compliance Committee, etc.
Advise/Suggest

Executive Functions(35 Executive Officers
incl. 6 concurrent Directors)

International AdvisoryBoard

25 CSR Digest 2013

Name

Title

MakotoOkitsuAdvisor of Teijin Limited

Hiroyuki
KamanoPartner (Attorney at law) of Kamano
Sogo Law Offices

Kunihiro
MatsuoAttorney at law

Reasons for Selection
Having served as Representative Director of Teijin Limited and Nabtesco Corporation,
Mr. Makoto Okitsu has considerable insight and profound experience in the businessworld. Using this experience, we expect him to execute his duties as Outside Audit &Supervisory Board Member from the standpoint of a specialist. Therefore, we haveelected him as Outside Audit & Supervisory Board Member.
Having served as an international attorney at law, Mr. Hiroyuki Kamano has richexperience in the field of international legal affairs. Using this experience, we expect him
to execute his duties as Outside Audit & Supervisory Board Member from the standpointof a specialist. Therefore, we have elected him as Outside Audit & Supervisory Board
Member.
Having served as Prosecutor-General of the Supreme Public Prosecutors Office, Mr.
Kunihiro Matsuo has rich experience in the legal profession. Using this experience,
we expect him to execute his duties as Outside Audit & Supervisory Board Member
from the standpoint of a specialist. Therefore, we have elected him as Outside Audit &Supervisory Board Member.

Collaboration

Recommend
Audit reports■ Outside Audit & Supervisory Board Members (As of June 19, 2013)

Compliance ・・・・・・・・・・・・・・・・・・・・・・・・・・・・

Agree with the selection/Decide the discharge or the rejection of reappointment/Confirm suitability or independency of the Accounting Auditors

Note:Figures in the diagram are as of June 19, 2013

appropriate audits by such means as hearing repor ts frommembers of the executive management team on their executionof duties. The Company has also established the Of fice ofCorporate Auditors’ Staf f to assist the Audit & Super visor y
Board Members in their duties. At least half of the five Audit &Supervisory Board Members are Outside Audit & Supervisory
Board Members.

We have established the Compliance Committee as the groupto oversee compliance, and it regularly reports its reviews andactivities to the Board of Directors. We shall also establish asystem to ensure Directors and employees thorough complianceto business rules as well as laws and regulations through avariety of measures, including the provision of Komatsu Code

Growing with Society

Elect/Discharge

Elect/Discharge

Kouichi Ikeda

Developing People

Title

Enhancing Quality of LifeWe, at Komatsu Ltd., believe our corporate value is the total sumof trust given to us by society and all stakeholders. To become acompany which enjoys more trust from shareholders and all otherstakeholders, we are working to strengthen corporate governance,

improve management efficiency, advocate corporate ethics and ensure
sound management on a group-wide basis. To further improve thetransparency of management for our shareholders and investors, we
disclose information in a fair and timely manner and actively engage ininvestor relations’ activities by holding meetings with shareholders andName

Our Approach to CSR

Organizational Profile ・・・・・・・・・・・・・・・・・・・

Growing with Societyof Worldwide Business Conduct, appointment of the Executive
O f f icer in charge of compliance, and establishment of theCompliance Depar tment. Through all of these, we work tosuper vise, educate and train Directors, Audit & Super visor y
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
and business rules will not be penalized.

CSR Digest 201326

CSR Themes ❸Environmental and Social Activities to Date・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・

Growing with Society■ Overview of Komatsu's Environmental and Social Activities to Date

Project for Creating Safe Villages– Turning a Field of Mines into a Place to Live.
We Help People Sustain Themsellves and Thrive. –Using its expertise in construction equipment technology, Komatsu is supporting demining work in areas
plagued by anti-personnel landmines. Komatsu also participates in community development projects torevitalize affected areas.

Restoring Safety to the Land andSupporting the Construction of Basic
Infrastructure toward Self-Reliance andDevelopment of Communities ・・・・・・・・・・・・
Since 2008, Komatsu has been working jointly with the Japan Mine
Action Service (JMAS), an incorporated non-profit organization (NPO),on a community-development project to demine and rebuild areas
affected by anti-personnel landmines in Cambodia and Angola.

through our expertise and Monozukuri (manufacturing) knowledge as aconstruction equipment manufacturer.
After demining, we begin development of the safe land for agricultural
use utilizing our construction equipment. We also implement
community rejuvenation and reconstruction projects that include
digging detention basins, building elementary schools, and repairingand building roads and bridges to support the construction of basic
infrastructure so that communities will be able to sustain themselves
and thrive.

1962

Began continuous support for the Flower Association of Japan
since its founding

Agreement concluded with Japanese NPO Japan Mine Action
Service (JMAS)

Earth Environment Committee established

The Komatsu Group in Japan acquire ISO14001 integrated
certification

1991
Company name changed in Japanese public relations
to"Komatsu," with new corporate brand logotype
1992

2008
Development of PC200-8 hybrid hydraulic excavator announced

Komatsu Earth Environment Charter and Environmental Action
Plan formulated

Signed the United Nations Global Compact

First Environmental Report publishedStarted Angola local reconstruction project with JMAS

1994
Board of Corporate Auditors established
2009
1995

Komatsu establishes the International Advisory Board (IAB).

1997

Oyama Plant becomes first in Japanese construction
equipment industry to acquire ISO14001 certification
Ethics Committee established (Renamed as Compliance
Committee later)

Komatsu provides demining and construction machinery, developed

PBZ and PAS series of press brakes acquire MF eco machine*certification
Basic agreement reached between Komatsu, Adaro and UT on
the biodiesel project in Indonesia*The MF Eco machine Certification System is an eco-label
established by the Japan Forming Machinery Association.
New mediumand long-term targets are set to reduce CO²
emissions from manufacturing facilities

2010
Komatsu Earth Environment Charter is revised

1998
First edition of Komatsu's Code of Worldwide Business Conduct
published

Vehicle equipped with a new type of engine that meets Tier4
emission standards for Japan, the U.S.A. and Europe isintroduced in the North American Market

Executive Officer system established; Board of Directors
reorganized (Outside directors system introduced).
1999

Komatsu's "Declaration of Biodiversity" is establishedCompensation Council established
Komatsu establishes "the Komatsu Scholarship" to the students
who have suffered financially from the Great East Japan
Earthquake and tsunami.

First Global Environmental Affairs Meeting convened
2000
Komatsu demining machine for removal of anti-personnel mines

Environmental Report again published; published annually
thereafter

Komatsu construction equipment for building infrastructure

Project for Creating Safe Villages in
Cambodia ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・

Project for Rebuilding Communities inAngola, Africa ・・・・・・・・・・・・・・・・・・・・・・・・・・

Over the past five years, we have completed demining efforts andrejuvenated areas spanning five villages. We have also removed
landmines from an area of approximately 450 ha, repaired and built
roads stretching 20 kilometers, dug around 40 detention basins,
created settlements for 500 families and constructed four elementary
schools. As a result, minefields have been resuscitated into farmland
and distribution routes have been established, enabling many villagers
to sell their agricultural products and become self-sustaining, thereby

Since FY2009 we have also been participating with JMAS in ademining and community rebuilding project in Angola, West Africa.
We have demined approximately 100 ha and offered support to the
local people, including cleanup activities and efforts to improve theirperception of agriculture. Plans are currently underway to move thestate capital to the mine-cleared part of Mabubas.

raising their living standards.

Local reconstruction project in Cambodia is completed with JMAS2011
CSR themes are defined.

2001

Compliance Department established2002

All seven Komatsu Group manufacturing facilities in Japanacquire ISO14001 certification

2003

Environmental Affairs Department established

Eighth edition of Komatsu's Worldwide Code of BusinessConduct published

2004

Corporate Social Responsibility Department established

Held the opening ceremony of the pilot plant for the Biodiesel
Fuel Project to be implemented by Komatsu, Adaro, and UT

2005

First European Health, Safety, and Environment Meeting convened
All Komatsu Group manufacturing facilities in Japan attain "zeroemissions"2006"Komatsu Green Park" opens in Komatsu City, the company's
birthplace

Komatsu's "CSR Procurement Guideline" is establishedEstablished the "Komatsu Kids Oyama" nursery center in the
Oyama Plant
2012
The number of visitors to "Komatsu-no-Mori" exceeds hundred
thousand.

The KOMATSU Way explicitly defined and promotion activities
launched
Cornfields spread out across the safe
land and the Komatsu School

27 CSR Digest 2013Children at a settlement

Removing landmines in Angola

Plan for constructing a water
purification plant as part of the effort tomove the state capital

2007

Seventh edition of Komatsu's Code of Worldwide BusinessConduct published2013

Hybrid AC Servo press [H1F Series] acquired MF eco machine
certification

CSR Digest 201328

Corporate Infomation■ Corporate profile
Company Name

Komatsu Ltd.

Head Office

2-3-6, Akasaka, Minato-ku, Tokyo 107-8414, Japan

EstablishedMay 13, 1921

Representative

President and Chief Executive Officer Tetsuji Ohashi

Common Stock

Consolidated 67,870 million yen
Non-Consolidated 70,120 million yen

Net Sales

Main Lines of Business

Number of Group Companies￥1,884.9 billion(Consolidated for fiscal year ended March 31, 2013)

Development, manufacture and sale of construction equipment, utility equipment(small construction equipment), forestry equipment, industrial machinery, etc.

147 (Komatsu Ltd. and affiliated companies)■ Number of employees by region■ Number of employees
Consolidated
Non-consolidated

Japan

19,172The Americas

11,358Europe and CIS

3,518

China

4,717

Asia (ex.Japan and China)
and Oceania

6,609

Middle East and Africa

1,356

46,730 (Komatsu Ltd. and affiliated companies)
9,921■ Changes and breakdown of sales

Sales by region (Construction and mining equipment, vehicles to outside customers)

Net Sales（Billions of yen）

1,843.1

1,981.7

Africa 98

1,884.9

Middle East 29.6
Oceania 193
Asia 218
China 119.9

FY201029 CSR Digest 2013

FY2011FY2012

CIS 89.4（Billions of yen）

6%
2% 17%
12%
17%

13%
7%
5% 15%

Japan 292.7

North America 276.4

6%

Latin America 259.2

Europe 100.3